Investor Presentation
Non-GAAP reconciliation: H1 '19 location gross profit (loss) from membership and
service revenue and Location contribution margin for buildings at various enterprise
membership percentages
($ in millions)
Location gross profit (loss) from membership and service revenue calculated in accordance with
GAAP:
Membership and service revenue
Cost of membership and service revenue:
≥50% Enterprise mature
≥50% SMB mature locations Non-Mature & Other (2)
locations
Total Consolidated - All
locations
$47
$438
$864
$1,349
Location operating expenses (exclusive of depreciation and amortization shown separately
below)
(32)
(355)
($846)
(1,233)
Depreciation and amortization - relating to location operating expenses
(5)
(69)
(156)
(230)
Total cost of membership and service revenue
($37)
($424)
($1,002)
($1,463)
Location gross profit (loss) from membership and service revenue
$9
$14
($138)
($114)
Location gross profit (loss) margin percentage
20%
3%
(16%)
(8%)
Reconciliation of GAAP location gross profit (loss) from membership and service revenue to
non-GAAP location contribution margin:
Location gross profit (loss) from membership and service revenue
$9
414
$14
($138)
($114)
Add:
Depreciation and amortization - relating to location operating expenses
5
69
62
Stock-based compensation expense (as included in location operating expenses) (1)
26
1566
156
230
26
26
Location contribution margin
$15
$83
$18
$142
Impact of non-cash GAAP straight-line lease cost (as included in location operating expenses)
on location contribution margin
(0)
(18)
216
198
Location contribution margin percentage
32%
19%
10%
Non-cash GAAP straight-line lease cost as a % of membership and service revenue
1%
4%
15%
Benefit of non-cash amortization of lease incentives as a % of membership and service revenue
(5%)
(5%)
(5%)
(1)
(2)
Represents the non-cash expense of our equity compensation arrangements for employees whose payroll is included in location operating expense. Stock-based compensation expense is not allocated at the location level.
The "Other" cohort relates to membership and service revenue related to management fees earned for providing services to unconsolidated locations in India and revenue, location operating expenses, and depreciation relating
to locations that also serve as headquarters locations that are not included in the Company's cohort analysis, as performance of these locations is not representative of our open locations
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