Organization and Summary of Significant Accounting Policies (Policies)
|9 Months Ended
Sep. 30, 2022
|Organization, Consolidation and Presentation of Financial Statements [Abstract]
|Basis of Presentation
|Basis of Presentation and Principles of ConsolidationThe accompanying unaudited condensed consolidated financial statements (“condensed consolidated financial statements”) include the accounts of the Company and its wholly owned subsidiaries and have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the accounting disclosure rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. The condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K/A for the year ended December 31, 2021 (the "2021 Form 10-K/A").
|Principles of Consolidation
|All intercompany balances and transactions are eliminated upon consolidation.
|Use of Estimates
|Use of EstimatesThe preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the condensed consolidated financial statements, the reported amounts of revenues and expenses during the reporting period, and the disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements. On an ongoing basis, management evaluates estimates, which are subject to significant judgment, including, but not limited to, those related to useful lives associated with vehicles, valuation of goodwill, Product Sales inventory and inventory deposits, and other long-lived assets, assumptions utilized in the valuation of derivative liabilities and certain equity awards, loss contingencies, valuation allowance for deferred income taxes, and the collectability of accounts receivable. Actual results could differ from those estimates.
|Inventory, netInventory consists of vehicles and spare parts available for sale, valued at the lower of cost based on an average cost method or net realizable value (“lower of cost or net realizable value”). This valuation requires the Company to make judgments, based on currently available information. The average cost of inventory consists of the price paid for the aforementioned vehicles and spare parts plus freight from manufacturers and any customs or duties incurred.
Our capital expenditure cycle often requires us to pay deposits to secure orders for the Product Sales business. The Company records deposits based on the amount of cash paid to secure future production, and evaluates the assets for impairment, as needed.
|Evaluation of Long-Lived Assets for Impairment
Evaluation of Long-Lived Assets for Impairment
The Company evaluates its held-and-used long-lived assets for indicators of possible impairment when events or changes in circumstances indicate the carrying amount of an asset or asset group (collectively, the “asset group”) may not be recoverable. The Company measures the recoverability of the asset group by comparing the carrying amount of such asset group to the future undiscounted cash flows it expects the asset group to generate. If the Company considers the assetgroup to be impaired, the impairment to be recognized equals the amount by which the carrying value of the asset group exceeds its fair value.
|Recently Issued Accounting Standards Not Yet Adopted
Recently Issued Accounting Standards Not Yet Adopted
In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2016-02—Leases (Topic 842), which introduces a lessee model that brings most leases on the balance sheet and aligns many of the underlying principles of the new lessor model with those in the new revenue recognition standard. The FASB also subsequently issued guidance amending and clarifying various aspects of the new leases guidance. The new leasing standard represents a wholesale change to lease accounting for lessees and requires additional disclosures regarding leasing arrangements. This update is effective for annual periods beginning January 1, 2022, and interim periods beginning January 1, 2023, with early adoption permitted.
The Company plans to adopt ASU 2016-02 for the annual period beginning January 1, 2022, using a prospective adoption method in accordance with ASU 2018-11—Leases (Topic 842): Targeted Improvements, which eliminated the requirement to present prior year comparative lease disclosures upon adoption of ASU 2016-02. The Company is continuing to assess the potential impacts of ASU 2016-02 on its consolidated financial statements and related disclosures. While the Company anticipates the guidance will result in an increase in its assets and liabilities as certain operating lease commitments will be subject to the new standard and recognized as right-of-use assets and lease liabilities, the Company does not anticipate any material changes to its revenue recognition policy.
The Company does not believe there are any other recently issued and effective or not yet effective standards or pronouncements that would have or are expected to have any significant effect on the Company’s financial position, cash flows or results of operations.
|Restatement of Condensed Consolidated Financial Statements
Restatement of Condensed Consolidated Financial Statements
In connection with the preparation of this Quarterly Report, the Company identified an error related to its business system configuration that impacted the recognition of revenue on certain trips completed by customers of its Sharing business ("Rides") for which collectability was not probable. Specifically, for customers with insufficient preloaded "wallet" balances, following the completion of Rides our business systems recorded revenue for uncollectible balances. The error resulted in an overstatement of Sharing revenue in the condensed consolidated statements of operations for the nine months ended September 30, 2022 and the three and nine months ended September 30, 2021, and an understatement of deferred revenue in the condensed consolidated balance sheet as of December 31, 2021. We also corrected certain other previously identified immaterial errors included in the financial statements as of and for the three and nine months ended September 30, 2021 and 2020, and as of and for the year ended December 31, 2020, as disclosed in the 2021 Form 10-K/A.
Impact of RestatementThe correction of this misstatement resulted in a decrease in Sharing revenue of $12.5 million for the nine months ended September 30, 2022 and $4.3 million and $10.1 million for the three and nine months ended September 30, 2021, respectively, in the condensed consolidated statements of operations, and an increase in deferred revenue of $19.1 million as of December 31, 2021 in the condensed consolidated balance sheets.
|Fair Value Measurements
|Fair Value Measurements
Recurring Fair Value Measurements
GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants in the principal market or, if none exists, the most advantageous market, for the specific asset or liability at the measurement date (referred to as the “exit price”). Fair value is a market-based measurement that is determined based upon assumptions that market participants would use in pricing an asset or liability, including consideration of nonperformance risk.
The Company discloses and recognizes the fair value of its assets and liabilities using a hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. This hierarchy indicates the extent to which inputs used in measuring fair value are observable in the market.
•Level 1: Inputs that reflect quoted prices for identical assets or liabilities in active markets that are observable.
•Level 2: Inputs other than quoted prices included in Level 1 that are observable, either directly or indirectly, including quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.
•Level 3: Inputs that are unobservable to the extent that observable inputs are not available for the asset or liability at the measurement date and include management’s judgment about assumptions market participants would use in pricing the asset or liability.