MemGPT/example-sec-filings · Datasets at Hugging Face

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including inflation, slower growth or recession, higher interest rates,
high unemployment, and currency fluctuations can adversely affect
consumer confidence in spending and materially adversely affect the
demand for travel or similar experiences. Additionally, consumer
confidence and spending can be materially adversely affected in response
to financial market volatility, negative financial news, conditions in
the real estate and mortgage markets, declines in income or asset
values, energy shortages or cost increases, labor and healthcare costs,
and other economic factors. These factors may affect demand for our
offerings, and uncertainty about global or regional economic conditions
can also have a negative adverse impact on the number of Hosts and
guests who use our platform. Consumer preferences tend to shift to
lower-cost alternatives during recessionary periods and other periods in
which disposable income is adversely affected, which could lead to a
decline in the bookings and prices for stays and experiences on our
platform and an increase in cancellations, and thus result in lower
revenue. Leisure travel in particular, which accounts for a substantial
majority of our current business, is dependent on discretionary consumer
spending levels. Downturns in worldwide or regional economic conditions
have led to a general decrease in leisure travel and travel spending in
the past, and similar downturns in the future may materially adversely
impact demand for our platform and services. Such a shift in consumer
behavior would materially adversely affect our business, results of
operations, and financial condition.

*The COVID-19 pandemic has materially adversely impacted, and may
continue to adversely impact, our business, results of operations, and
financial condition.*

Since early 2020, the world has been and continues to be impacted by
COVID-19 and its variants. Government regulations in response to the
pandemic and changes in social behaviors have closed or limited certain
government functions, businesses, or have otherwise limited social or
public gatherings. Such mitigation measures that have impacted our
business include travel restrictions or quarantine and shelter-in-place
orders. These responses, which continue to shift as variants or
outbreaks of COVID-19 continue to develop, have had and may continue to
have a material adverse impact on our business and operations and on
travel behavior and demand.

Global economic conditions and consumer trends have shifted since early
2020 in response to the COVID-19 pandemic, and continue to persist and
may have a long-lasting adverse impact on us and the travel industry
independently of the progress of the pandemic.

The extent of the continued impact of the COVID-19 pandemic or any
future pandemic or epidemic on our business and financial results will
depend largely on future developments globally and within the United
States, the prevalence of local, national, and international travel
restrictions (including new or reinstated restrictions as a result of
COVID-19 variants or other highly infectious diseases), vaccination
requirements in connection with travel, and impacts and fluctuations in
demand for travel, including air travel or gas prices. To the extent the
COVID-19 pandemic continues to impact our business, results of
operations, and financial condition, it may also have the effect of
heightening many of the other risks described in these "isk Factors"or
elsewhere in this Annual Report on Form 10-K. Any of the foregoing
factors, or other cascading effects of the COVID-19 pandemic or any
future pandemic or epidemic and changes in macroeconomic conditions that
are not currently foreseeable, may materially adversely impact our
business, results of operations, and financial condition.

*We have previously incurred net losses and our Adjusted EBITDA and Free
Cash Flow have declined in prior periods. We may once again incur net
losses and see a decline in Adjusted EBITDA and Free Cash Flow and we
may not be able to sustain profitability.*

Although we had net income of \$1.9 billion for the year ended December
31, 2022, we incurred net losses of \$4.6 billion and \$352.0 million
for the years ended December 1, 2020 and 2021, respectively. As of
December 1, 2022, we had an accumulated deficit of \$6.0 billion. Any
failure to increase our revenue or any failure to manage an increase in
our operating expenses could prevent us from sustaining profitability as
measured by net income, operating income, or Adjusted EBITDA.

Additionally, stock-based compensation expense related to restricted
stock units ("SUs" and other equity awards will continue to be a
significant expense in future periods. In addition, in the first quarter
of 2022, we began using corporate cash to make required tax payments
associated with the vesting of employee RSUs and withhold a
corresponding number of shares from employees. We anticipate that we
will spend substantial funds to satisfy tax withholding and remittance
obligations when we settle employee RSUs.

Although we had positive Adjusted EBITDA of \$1.6 billion and \$2.9
billion for the years ended December 31, 2021 and 2022, respectively, we
had negative Adjusted EBITDA of \$(251.0) million for the year ended
December 31, 2020. Our Free Cash Flow was \$(777.9) million, \$2.3
billion, and \$3.4 billion for the years ended December 31, 2020, 2021
and 2022, respectively. While our Adjusted EBITDA and Free Cash Flow
increased in 2021 and 2022, we may experience declines in Adjusted
EBITDA and Free Cash Flow in the future. Adverse developments in our

10

business, including lower than anticipated revenue, higher than
anticipated operating expenses, impacts of the ongoing COVID-19 pandemic
and net unfavorable changes in working capital, could result in a
negative trend in our Adjusted EBITDA and Free Cash Flow. If our future
Adjusted EBITDA or Free Cash Flow fail to meet investor or analyst

including inflation, slower growth or recession, higher interest rates,

high unemployment, and currency fluctuations can adversely affect

consumer confidence in spending and materially adversely affect the

demand for travel or similar experiences. Additionally, consumer

confidence and spending can be materially adversely affected in response

to financial market volatility, negative financial news, conditions in

the real estate and mortgage markets, declines in income or asset

values, energy shortages or cost increases, labor and healthcare costs,

and other economic factors. These factors may affect demand for our

offerings, and uncertainty about global or regional economic conditions

can also have a negative adverse impact on the number of Hosts and

guests who use our platform. Consumer preferences tend to shift to

lower-cost alternatives during recessionary periods and other periods in

which disposable income is adversely affected, which could lead to a

decline in the bookings and prices for stays and experiences on our

platform and an increase in cancellations, and thus result in lower

revenue. Leisure travel in particular, which accounts for a substantial

majority of our current business, is dependent on discretionary consumer

spending levels. Downturns in worldwide or regional economic conditions

have led to a general decrease in leisure travel and travel spending in

the past, and similar downturns in the future may materially adversely

impact demand for our platform and services. Such a shift in consumer

behavior would materially adversely affect our business, results of

operations, and financial condition.

*The COVID-19 pandemic has materially adversely impacted, and may

continue to adversely impact, our business, results of operations, and

financial condition.*

Since early 2020, the world has been and continues to be impacted by

COVID-19 and its variants. Government regulations in response to the

pandemic and changes in social behaviors have closed or limited certain

government functions, businesses, or have otherwise limited social or

public gatherings. Such mitigation measures that have impacted our

business include travel restrictions or quarantine and shelter-in-place

orders. These responses, which continue to shift as variants or

outbreaks of COVID-19 continue to develop, have had and may continue to

have a material adverse impact on our business and operations and on

travel behavior and demand.

Global economic conditions and consumer trends have shifted since early

2020 in response to the COVID-19 pandemic, and continue to persist and

may have a long-lasting adverse impact on us and the travel industry

independently of the progress of the pandemic.

The extent of the continued impact of the COVID-19 pandemic or any

future pandemic or epidemic on our business and financial results will

depend largely on future developments globally and within the United

States, the prevalence of local, national, and international travel

restrictions (including new or reinstated restrictions as a result of

COVID-19 variants or other highly infectious diseases), vaccination

requirements in connection with travel, and impacts and fluctuations in

demand for travel, including air travel or gas prices. To the extent the

COVID-19 pandemic continues to impact our business, results of

operations, and financial condition, it may also have the effect of

heightening many of the other risks described in these "isk Factors"or

elsewhere in this Annual Report on Form 10-K. Any of the foregoing

factors, or other cascading effects of the COVID-19 pandemic or any

future pandemic or epidemic and changes in macroeconomic conditions that

are not currently foreseeable, may materially adversely impact our

business, results of operations, and financial condition.

*We have previously incurred net losses and our Adjusted EBITDA and Free

Cash Flow have declined in prior periods. We may once again incur net

losses and see a decline in Adjusted EBITDA and Free Cash Flow and we

may not be able to sustain profitability.*

Although we had net income of \$1.9 billion for the year ended December

31, 2022, we incurred net losses of \$4.6 billion and \$352.0 million

for the years ended December 1, 2020 and 2021, respectively. As of

December 1, 2022, we had an accumulated deficit of \$6.0 billion. Any

failure to increase our revenue or any failure to manage an increase in

our operating expenses could prevent us from sustaining profitability as

measured by net income, operating income, or Adjusted EBITDA.

Additionally, stock-based compensation expense related to restricted

stock units ("SUs" and other equity awards will continue to be a

significant expense in future periods. In addition, in the first quarter

of 2022, we began using corporate cash to make required tax payments

associated with the vesting of employee RSUs and withhold a

corresponding number of shares from employees. We anticipate that we

will spend substantial funds to satisfy tax withholding and remittance

obligations when we settle employee RSUs.

Although we had positive Adjusted EBITDA of \$1.6 billion and \$2.9

billion for the years ended December 31, 2021 and 2022, respectively, we

had negative Adjusted EBITDA of \$(251.0) million for the year ended

December 31, 2020. Our Free Cash Flow was \$(777.9) million, \$2.3

billion, and \$3.4 billion for the years ended December 31, 2020, 2021

and 2022, respectively. While our Adjusted EBITDA and Free Cash Flow

increased in 2021 and 2022, we may experience declines in Adjusted

EBITDA and Free Cash Flow in the future. Adverse developments in our

10

business, including lower than anticipated revenue, higher than

anticipated operating expenses, impacts of the ongoing COVID-19 pandemic

and net unfavorable changes in working capital, could result in a

negative trend in our Adjusted EBITDA and Free Cash Flow. If our future

Adjusted EBITDA or Free Cash Flow fail to meet investor or analyst