0001530979-24-000028 | 10-K | XBRL Viewer

Leases (Tables)

12 Months Ended

Dec. 31, 2023

The components of lease expense were as follows (in thousands):


	For the year ended December 31,
	2023		2022
Finance lease expense:
Amortization	$	50	$	263
Interest on lease liabilities	—		7
Operating lease expense:

Operating lease expense(1)	7,168		7,153
Sublease income	(2,006)		(2,006)
Total lease expense, net	$	5,212	$	5,417

______________________

(1) Represents the straight-line lease expense of operating leases, inclusive of amortization of ROU assets and the interest component of operating lease liabilities.

Assets and Liabilities, Lessee

The following tables set forth the amount of lease assets and lease liabilities included in the Company’s consolidated balance sheets (in thousands):


		As of December 31,
Assets	Financial Statement Line Item	2023		2022
Finance lease assets	Property and equipment, net	$	17	$	70
Operating lease assets	Operating lease right-of-use asset	23,683		29,947
Total lease assets		$	23,700	$	30,017
Liabilities
Current
Finance lease liabilities	Accrued expenses	23		52
Operating lease liabilities	Accrued expenses	8,105		7,688
Non-current
Finance lease liabilities	Other long-term liabilities	—		22
Operating lease liabilities	Operating lease liabilities, net of current portion	21,738		29,842
Total lease liabilities		$	29,866	$	37,604

Supplemental information related to the Company’s leases for the year ended December 31, 2023 was as follows:


	For the year ended December 31,
	2023	2022
Weighted-average remaining lease term (in years)
Finance leases	0.6	1.4
Operating leases	4.1	4.5
Weighted-average discount rate
Finance leases	2.77%	3.00%
Operating leases	2.29%	2.29%
Cash paid for amounts included in the measurement of lease liabilities (in thousands)
Operating cash flows used in finance leases	$1	$8
Operating cash flows used in operating leases	$7,688	$7,007
Finance cash flows used in finance leases	$58	$303

Lessee, Operating Lease, Liability, Maturity

Future minimum lease payments required under operating and finance leases as of December 31, 2023, were as follows (in thousands):


	Operating Leases		Finance Leases
2024	$	8,704	22
2025	8,950		1
2026	9,201		—
2027	4,246		—
2028	—		—
Thereafter	—		—
Future minimum lease payments	$	31,101	$	23
Less: Amount representing interest	(1,258)		—
Present value of future lease payments	$	29,843	$	23

Finance Lease, Liability, Fiscal Year Maturity

Future minimum lease payments required under operating and finance leases as of December 31, 2023, were as follows (in thousands):


	Operating Leases		Finance Leases
2024	$	8,704	22
2025	8,950		1
2026	9,201		—
2027	4,246		—
2028	—		—
Thereafter	—		—
Future minimum lease payments	$	31,101	$	23
Less: Amount representing interest	(1,258)		—
Present value of future lease payments	$	29,843	$	23

Restructuring - Schedule of Costs Associated with the Transformation Initiative (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Restructuring Cost and Reserve [Line Items]
Restructuring	$ 2,205	$ 0	$ 0
Transformation Initiative \| Restructuring Costs
Restructuring Cost and Reserve [Line Items]
Restructuring	2,205
Transformation Initiative \| Employee-Related Costs \| Restructuring Costs
Restructuring Cost and Reserve [Line Items]
Restructuring	1,142
Transformation Initiative \| Asset-Related Costs \| Restructuring Costs
Restructuring Cost and Reserve [Line Items]
Restructuring	193
Transformation Initiative \| Contract Terminations \| Restructuring Costs
Restructuring Cost and Reserve [Line Items]
Restructuring	$ 870

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References + Details

Stock-Based Compensation - 2023 Inducement Plan (Details) - shares	Nov. 01, 2023	May 18, 2023	Mar. 21, 2023	Mar. 31, 2023	Dec. 31, 2020
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of common stock authorized to be issued (in shares)					6,176,766
2023 Inducement Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of common stock authorized to be issued (in shares)				4,000,000
2023 Inducement Plan \| Unvested restricted stock units \| Chief Executive Officer
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock units granted (in shares)			1,845,238
2023 Inducement Plan \| Unvested restricted stock units \| Chief Growth Officer
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock units granted (in shares)		843,565
2023 Inducement Plan \| Unvested restricted stock units \| Chief Financial Officer
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock units granted (in shares)	827,357

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Income Statement [Abstract]
Revenue	$ 344,365	$ 313,651	$ 318,639
Cost of revenue	243,833	221,336	209,467
Gross profit	100,532	92,315	109,172
Operating expenses
Selling, general and administrative	94,582	87,317	84,059
Marketing	36,440	47,782	54,260
Restructuring	2,205	0	0
Research and development	6,214	6,996	7,679
Total operating expenses	139,441	142,095	145,998
Operating loss	(38,909)	(49,780)	(36,826)
Interest and other income (expense), net	(254)	871	(1,776)
Loss before provision for income taxes	(39,163)	(48,909)	(38,602)
Income tax provision	75	110	77
Net loss	$ (39,238)	$ (49,019)	$ (38,679)
Net loss per share attributable to common stockholders:
Basic (in USD per share)	$ (0.42)	$ (0.53)	$ (0.43)
Diluted (in USD per share)	$ (0.42)	$ (0.53)	$ (0.43)
Weighted-average shares used in computing net loss per share attributable to common stockholders:
Basic (in shares)	94,516,690	92,201,806	71,126,218
Diluted (in shares)	94,516,690	92,201,806	71,126,218
Other comprehensive loss
Unrealized gain (loss) on short-term investments, net of taxes	$ 32	$ 9	$ (135)
Comprehensive loss	$ (39,206)	$ (49,010)	$ (38,814)

Investments

12 Months Ended

Dec. 31, 2023

Investments, Debt and Equity Securities [Abstract]

Investments

All investments in debt securities, if any, are classified as available-for-sale investments. All investments are reported within current assets because the securities represent investments of cash available for current operations. As of December 31, 2023, the Company did not hold any investments in debt securities. As of December 31, 2022, the Company held $5.7 million of investments with contractual maturities of less than one year. As of December 31, 2022, the Company did not have any investments with contractual maturities between one and two years. Available-for-sale investments are recorded at fair value, and unrealized holding gains and losses are recorded as a component of other comprehensive income (loss).

The following table summarizes the Company’s available-for-sale investments:


	As of December 31, 2022
	Cost or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Total Estimated Fair Value
(In thousands)
Corporate bonds	$	3,216	$	—	$	(24)	$	3,193
Commercial paper	582		—		—		582
Certificates of deposit	1,884		—		(9)		1,875

Total investments	$	5,682	$	—	$	(33)	$	5,650

Realized gains and losses on investments in debt securities for the years ended December 31, 2023, 2022 and 2021 were immaterial. Unrealized losses on investments for the year ended December 31, 2023 was immaterial.

Leases - Summary of Future Minimum Lease Payments for Operating and Finance Leases (Details) $ in Thousands	Dec. 31, 2023 USD ($)
Operating Leases
2024	$ 8,704
2025	8,950
2026	9,201
2027	4,246
2028	0
Thereafter	0
Future minimum lease payments	31,101
Less: Amount representing interest	(1,258)
Present value of future lease payments	29,843
Finance Leases
2024	22
2025	1
2026	0
2027	0
2028	0
Thereafter	0
Future minimum lease payments	23
Less: Amount representing interest	0
Present value of future lease payments	$ 23

Leases - Summary of Lease Cost (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Leases [Abstract]
Amortization	$ 50	$ 263
Interest on lease liabilities	0	7
Operating lease expense	7,168	7,153
Sublease income	(2,006)	(2,006)
Total lease expense, net	$ 5,212	$ 5,417

Fair Value Measurements (Tables)

12 Months Ended

Dec. 31, 2023

Fair Value Disclosures [Abstract]

Fair Value, Assets Measured on Recurring Basis

Financial assets measured and recorded at fair value on a recurring basis consist of the following as of:


	December 31, 2023
	Level 1		Level 2		Level 3		Total
(In thousands)
Cash equivalents
Money market funds	$	5,589	$	—	$	—	$	5,589


Total cash equivalents	5,589		—		—		5,589


	December 31, 2022
	Level 1		Level 2		Level 3		Total
(In thousands)
Cash equivalents
Money market funds	$	9,595	$	—	$	—	$	9,595
Total cash equivalents	9,595		—		—		9,595
Short-term investments
Corporate bonds	—		3,193		—		3,193
Commercial paper	—		582		—		582
Certificates of deposit	—		1,875		—		1,875

Total short-term investments	—		5,650		—		5,650
Total	$	9,595	$	5,650	$	—	$	15,245

Redeemable Convertible Preferred Stock and Stockholders’ Deficit - Additional Information (Details) - USD ($) $ in Thousands			12 Months Ended
	May 07, 2021	May 06, 2021	Dec. 31, 2021	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2020
Temporary Equity [Line Items]
Common stock authorized (in shares)		1,000,000,000		1,000,000,000	1,000,000,000
Preferred stock authorized (in shares)		20,000,000		20,000,000	20,000,000
Outstanding shares of redeemable convertible preferred stock (in shares)		49,100,928	0			49,100,928
Carrying Value		$ 376,400	$ 0			$ 376,404
Number of common stock issued from conversion (in shares)		49,649,023
Conversion of redeemable convertible preferred stock to common stock upon initial public offering	$ 29,000		$ 376,405
Series A Redeemable Convertible Preferred Stock
Temporary Equity [Line Items]
Outstanding shares of redeemable convertible preferred stock (in shares)						11,347,518
Carrying Value						$ 6,000
Shares available for issuance (in shares)			0
Series A-1 Redeemable Convertible Preferred Stock
Temporary Equity [Line Items]
Outstanding shares of redeemable convertible preferred stock (in shares)						11,554,016
Carrying Value						$ 20,796
Shares available for issuance (in shares)			0
Series B Redeemable Convertible Preferred Stock
Temporary Equity [Line Items]
Outstanding shares of redeemable convertible preferred stock (in shares)						4,551,572
Carrying Value						$ 42,106
Shares available for issuance (in shares)			0
Series C Redeemable Convertible Preferred Stock
Temporary Equity [Line Items]
Outstanding shares of redeemable convertible preferred stock (in shares)						5,174,204
Carrying Value						$ 90,586
Shares available for issuance (in shares)			0
Series D Redeemable Convertible Preferred Stock
Temporary Equity [Line Items]
Outstanding shares of redeemable convertible preferred stock (in shares)						4,454,624
Carrying Value						$ 101,239
Shares available for issuance (in shares)			0
Series E Redeemable Convertible Preferred Stock
Temporary Equity [Line Items]
Outstanding shares of redeemable convertible preferred stock (in shares)						6,918,204
Carrying Value						$ 67,685
Shares available for issuance (in shares)			0
Series F Redeemable Convertible Preferred Stock
Temporary Equity [Line Items]
Outstanding shares of redeemable convertible preferred stock (in shares)						5,100,790
Carrying Value						$ 47,992
Shares available for issuance (in shares)			0

Summary of Significant Accounting Policies - Summary of Sales Incentive Program Activity (Details) - Sales Incentive Program - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Revenue from Contract with Customer, Allowance for Sales Incentive Program [Roll Forward]
Beginning balance	$ 6,396	$ 6,494	$ 8,207
Charged to revenue	49,724	48,962	47,290
Utilization of accrual for trade promotions	(64,522)	(61,954)	(65,153)
Reclassification to prepaid expenses and other current assets/accrued expenses	(933)	(197)	0
Ending balance	8,380	6,396	6,494
Charged to selling, general and administrative expense
Revenue from Contract with Customer, Allowance for Sales Incentive Program [Roll Forward]
Charged to marketing expense	659	550	0
Charged to marketing expense
Revenue from Contract with Customer, Allowance for Sales Incentive Program [Roll Forward]
Charged to marketing expense	$ 17,056	$ 12,541	$ 16,150

Property and Equipment, Net - Components (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Property, Plant and Equipment [Line Items]
Subtotal	$ 40,808	$ 40,154
Accumulated depreciation and amortization	(27,322)	(25,827)
Property and equipment, net	13,486	14,327
Machinery and equipment
Property, Plant and Equipment [Line Items]
Property and equipment, gross	13,850	12,198
Computer and office equipment
Property, Plant and Equipment [Line Items]
Property and equipment, gross	1,700	1,794
Capitalized software
Property, Plant and Equipment [Line Items]
Property and equipment, gross	5,094	5,989
Furniture and fixtures
Property, Plant and Equipment [Line Items]
Property and equipment, gross	4,335	4,334
Leasehold improvements
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 15,829	$ 15,839

Fair Value Measurements (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments	$ 0	$ 5,650
Corporate bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments		3,193
Commercial paper
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments		582
Certificates of deposit
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments		1,875
Fair Value, Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	5,589	9,595
Short-term investments		5,650
Total		15,245
Fair Value, Recurring \| Corporate bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments		3,193
Fair Value, Recurring \| Commercial paper
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments		582
Fair Value, Recurring \| Certificates of deposit
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments		1,875
Fair Value, Recurring \| Money market funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	5,589	9,595
Fair Value, Recurring \| Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	5,589	9,595
Short-term investments		0
Total		9,595
Fair Value, Recurring \| Level 1 \| Corporate bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments		0
Fair Value, Recurring \| Level 1 \| Commercial paper
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments		0
Fair Value, Recurring \| Level 1 \| Certificates of deposit
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments		0
Fair Value, Recurring \| Level 1 \| Money market funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	5,589	9,595
Fair Value, Recurring \| Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	0	0
Short-term investments		5,650
Total		5,650
Fair Value, Recurring \| Level 2 \| Corporate bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments		3,193
Fair Value, Recurring \| Level 2 \| Commercial paper
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments		582
Fair Value, Recurring \| Level 2 \| Certificates of deposit
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments		1,875
Fair Value, Recurring \| Level 2 \| Money market funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	0	0
Fair Value, Recurring \| Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	0	0
Short-term investments		0
Total		0
Fair Value, Recurring \| Level 3 \| Corporate bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments		0
Fair Value, Recurring \| Level 3 \| Commercial paper
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments		0
Fair Value, Recurring \| Level 3 \| Certificates of deposit
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments		0
Fair Value, Recurring \| Level 3 \| Money market funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	$ 0	$ 0

Stock-Based Compensation - Stock-based Compensation Expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total stock-based compensation expense	$ 15,804	$ 15,078	$ 16,847
Certain Former Executives \| Unvested restricted stock units
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Share-based payment arrangement, accelerated cost	3,100
Certain Former Executives \| Share-Based Payment Arrangement, Option
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Fair value of awards on day of modification	500
Selling, general and administrative
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total stock-based compensation expense	15,465	14,593	15,820
Research and development
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total stock-based compensation expense	$ 339	$ 485	$ 1,027

Net Income (Loss) per Share Attributable to Common Stockholders (Tables)

12 Months Ended

Dec. 31, 2023

Earnings Per Share [Abstract]

Schedule of Earnings Per Share, Basic and Diluted

The following table sets forth the computation of the Company’s basic and diluted net loss per share attributable to common stockholders:


	For the year ended December 31,
(In thousands, except for share and per share values)	2023		2022		2021
Numerator:
Net loss	$	(39,238)	$	(49,019)	$	(38,679)
Add: gain on conversion of preferred stock(1)	—		—		28,994
Less: dividends paid to preferred stockholders(2)	—		—		(20,637)
Net loss attributable to common stockholders - basic and diluted	$	(39,238)	$	(49,019)	$	(30,322)



Denominator:
Weighted average shares of common stock outstanding - basic	94,516,690		92,201,806		71,126,218




Weighted average shares of common stock outstanding - diluted	94,516,690		92,201,806		71,126,218

Net loss per share, attributable to common shareholders:
Basic and diluted	$	(0.42)	$	(0.53)	$	(0.43)

_____________

(1) The conversion price of the Company’s Series C and Series D redeemable convertible preferred stock was adjusted as the offering price in the initial public offering was below a certain threshold resulting in the preferred stockholders receiving a fixed dollar amount on conversion settled into a variable number of shares, or a stock-settled redemption feature. Upon the settlement of this redemption feature, the Company recorded a gain on extinguishment of the redeemable convertible preferred stock of $29.0 million as an adjustment to net loss to arrive at net loss attributable to common stockholders to calculate earnings per share. The extinguishment gain was measured as the difference between the carrying amount of the redeemable convertible preferred stock and the fair value of common stock upon the IPO date that the preferred stock converted into.

(2) In April 2021, the Company's board of directors declared a cash dividend of $35.0 million to the holders of record of our common stock as of May 3, 2021, that was contingent upon the closing of the Company's IPO. On June 29, 2021, the Company paid the dividend, of which $20.6 million was paid to the holders of the Company's redeemable convertible preferred stock.

Schedule of Potentially Dilutive Shares

The following potentially dilutive shares were excluded from the computation of diluted net income (loss) per share because including them would have been antidilutive:


	For the year ended December 31,
		2023	2022	2021
Stock options to purchase common stock		13,315,796	14,888,007	16,440,539
Unvested restricted stock units		8,256,453	4,618,354	2,970,867
Employee stock purchase plan		71,142	62,438	39,157
Total		21,643,391	19,568,799	19,450,563

Redeemable Convertible Preferred Stock and Stockholders’ Deficit - Schedule of Stock Available for Future Issuance (Details)	Dec. 31, 2020 shares
Class of Stock [Line Items]
Available for issuance (in shares)	6,176,766
Authorized number of common shares
Class of Stock [Line Items]
Available for issuance (in shares)	110,000,000
Common shares outstanding
Class of Stock [Line Items]
Available for issuance (in shares)	34,089,186
Stock awards outstanding under the 2011 Plan
Class of Stock [Line Items]
Available for issuance (in shares)	18,038,042
Stock awards available for grant under the 2011 Plan
Class of Stock [Line Items]
Available for issuance (in shares)	2,595,078
Reserve for the conversion of preferred stock
Class of Stock [Line Items]
Available for issuance (in shares)	49,100,928

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References

Reference 1: http://www.xbrl.org/2003/role/exampleRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 2: http://www.xbrl.org/2003/role/recommendedDisclosureRef
-Topic 272
-SubTopic 10
-Name Accounting Standards Codification
-Section 45
-Paragraph 3
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483014/272-10-45-3

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 272
-SubTopic 10
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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482987/272-10-50-1

Reference 4: http://www.xbrl.org/2009/role/commonPracticeRef
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-Paragraph 1
-Subparagraph (SX 210.4-08(d))
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-URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
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-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (e)
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-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (h)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 14
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-14

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 18
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-18

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
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-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02(27)(b))
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Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 210
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02(28))
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-URI https://asc.fasb.org//1943274/2147480566/210-10-S99-1

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-2

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Topic 210
-SubTopic 10
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-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02(29))
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Reference 15: http://www.xbrl.org/2003/role/disclosureRef
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Reference 17: http://www.xbrl.org/2003/role/disclosureRef
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Reference 18: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

Accrued Expenses (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Schedule of Payables and Accruals [Line Items]
Payroll and payroll related expenses	$ 8,007	$ 6,790
Accrued inventory purchases	9,368	17,050
Accrued returns	269	318
Operating lease liabilities	8,105	7,688
Accrued restructuring	356	0
Other accrued expenses	6,104	6,164
Total accrued expenses	32,209	38,010
Chief Executive Officer
Schedule of Payables and Accruals [Line Items]
Payroll and payroll related expenses	$ 1,200
Chief Financial Officer
Schedule of Payables and Accruals [Line Items]
Payroll and payroll related expenses		$ 4,300

Investments - Additional Information (Details) - USD ($)	Dec. 31, 2023	Dec. 31, 2022
Investments, Debt and Equity Securities [Abstract]
Investments with contractual maturities of less than one year	$ 0	$ 5,700,000
Investments with contractual maturities between one and two years		$ 0

Fair Value Measurements

12 Months Ended

Dec. 31, 2023

Fair Value Disclosures [Abstract]

Fair Value Measurements

Financial assets measured and recorded at fair value on a recurring basis consist of the following as of:


	December 31, 2023
	Level 1		Level 2		Level 3		Total
(In thousands)
Cash equivalents
Money market funds	$	5,589	$	—	$	—	$	5,589


Total cash equivalents	5,589		—		—		5,589


	December 31, 2022
	Level 1		Level 2		Level 3		Total
(In thousands)
Cash equivalents
Money market funds	$	9,595	$	—	$	—	$	9,595
Total cash equivalents	9,595		—		—		9,595
Short-term investments
Corporate bonds	—		3,193		—		3,193
Commercial paper	—		582		—		582
Certificates of deposit	—		1,875		—		1,875

Total short-term investments	—		5,650		—		5,650
Total	$	9,595	$	5,650	$	—	$	15,245

The carrying amounts for the Company’s cash equivalents, accounts receivable, accounts payable, and accrued expenses approximate fair value due to their short maturities.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Summary of Significant Accounting Policies - Useful Life of Assets (Details)	Dec. 31, 2023
Machinery and equipment \| Minimum
Property, Plant and Equipment [Line Items]
Useful life	3 years
Machinery and equipment \| Maximum
Property, Plant and Equipment [Line Items]
Useful life	20 years
Computer and office equipment \| Minimum
Property, Plant and Equipment [Line Items]
Useful life	3 years
Computer and office equipment \| Maximum
Property, Plant and Equipment [Line Items]
Useful life	5 years
Capitalized software \| Minimum
Property, Plant and Equipment [Line Items]
Useful life	1 year
Capitalized software \| Maximum
Property, Plant and Equipment [Line Items]
Useful life	5 years
Furniture and fixtures \| Minimum
Property, Plant and Equipment [Line Items]
Useful life	3 years
Furniture and fixtures \| Maximum
Property, Plant and Equipment [Line Items]
Useful life	5 years
Building
Property, Plant and Equipment [Line Items]
Useful life	40 years

Income Taxes

12 Months Ended

Dec. 31, 2023

Income Tax Disclosure [Abstract]

Income Taxes

The components of income tax provision consisted of the following:


	For the year ended December 31,
		2023		2022		2021
(In thousands)
Current
Federal		$	—	$	—	$	—
State		75		110		77
Foreign		—		—		—
		75		110		77
Deferred
Federal		—		—		—
State		—		—		—
Foreign		—		—		—
		—		—		—
Income tax provision		$	75	$	110	$	77

The reconciliation of the income tax benefit computed at the U.S. federal statutory rate of 21% to the Company’s income tax provision is as follows:


	For the year ended December 31,
	2023		2022		2021
(In thousands)
Income tax benefit at the federal statutory rate	$	(8,203)	$	(10,271)	$	(8,106)
State income taxes, net of federal benefit	(90)		(625)		(143)
Permanent differences for equity compensation	2,587		2,604		5,156
Nondeductible items	142		53		84
Nondeductible compensation	1,218		302		1,349
Change in valuation allowance	4,654		8,047		1,737
Other adjustments	(233)		—		—
Income tax provision	$	75	$	110	$	77

The tax effects of temporary differences that gave rise to significant portions of deferred tax assets and liabilities were as follows:


	As of December 31,
(In thousands)	2023		2022
Deferred tax assets
Intangible assets	$	75	$	95
Property and equipment	867		815
Accrued expenses	1,488		653
Deferred revenue	113		51
Allowances, reserves and other	2,013		2,796
Stock-based compensation	7,728		8,335
Section 174 capitalized expenses	4,346		1,456
Net operating loss and other carryforwards	87,327		85,176
Total deferred tax assets	103,957		99,377
Valuation allowance	(98,771)		(94,103)
Net deferred tax assets	5,186		5,274
Deferred tax liabilities


Prepaid expenses	(376)		(364)
State taxes	(4,810)		(4,910)
Total deferred tax liabilities	(5,186)		(5,274)
Net deferred taxes	$	—	$	—

Effective January 1, 2022, the Tax Cuts and Jobs Act ("TCJA") of 2017 eliminated the option to deduct research and development expenses in the current year and now requires taxpayers to capitalize and amortize research and development expenses to Internal Revenue Code of 1986, as amended, (“IRC”) Section 174. Although Congress is considering legislation that would reinstate and extend Section 174 expensing for certain research and development expenses, the possibility that this will happen is uncertain. The capitalized expenses are amortized over a 5-year period for domestic expenses and a 15-year period for foreign expenses. As of December 31, 2023 and 2022, the Company's deferred tax assets related to capitalized research and development expenses were $4.3 million and $1.5 million, respectively.

As of December 31, 2023, the Company had federal and state net operating loss carryforwards tax effect of $311.0 million and $274.0 million, respectively. As of December 31, 2022, The Company had federal and state net operating loss carryforwards tax effect of $301.0 million and $272.0 million, respectively. Federal and state net operating loss carryforwards begin to expire in 2032. As of December 31, 2023 and 2022, the Company did not have any state tax credits. Federal net operating losses generated after January 1, 2018 would not expire, but would only be available to offset up to 80% of the Company’s future taxable income.

The IRC imposes substantial restrictions on the utilization of net operating losses and other tax attributes in the event of an “ownership change” of a corporation. Accordingly, a company’s ability to use pre-change net operating loss and research tax credits may be limited as prescribed under IRC Sections 382 and 383. Events which may cause limitation in the amount of the net operating losses and credits that the Company utilizes in any one year include, but are not limited to, a cumulative ownership change of more than 50% over a three-year period. The Company performed a study to determine whether net operating losses and credit carryover limitations exist under Section 382 as of December 31, 2020, and determined that a portion of the net operating losses that were generated during 2013 and prior are subject to Section 382 annual limitations. As of December 31, 2023 and 2022, these limitations did not cause any of the limited net operating losses to be permanently lost.

In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which temporary differences become deductible or includable in taxable income. Management assesses the available positive and negative evidence to estimate if sufficient future taxable income will be generated to use the existing deferred tax assets.

A significant piece of objective negative evidence evaluated was the cumulative loss incurred over the three-year period ended December 31, 2023. Such objective evidence limits the ability to consider other subjective evidence such as its projections for future growth. On the basis of this evaluation, at December 31, 2023, a full valuation allowance has been recorded since it is more likely than not that the deferred tax assets will not be realized.

The following table summarizes the changes in the valuation allowance:


	For the year ended December 31,
	2023		2022		2021
(In thousands)
Beginning balance	$	94,103	$	86,659	$	84,934
Increase to valuation allowance	4,654		8,047		1,737
Decrease due to adoption of ASC 842	—		(613)		—
Other increases (decreases)	14		10		(12)
Ending balance	$	98,771	$	94,103	$	86,659

The Company is subject to taxation in the U.S. federal and various state jurisdictions. During the years ended December 31, 2023 and 2022, the Company has not recorded any uncertain tax positions and has not recognized interest or penalties in the consolidated statements of comprehensive loss. The Company is subject to examination from federal tax authorities for years 2020, 2021 and 2022. To the extent allowed by law, the federal and state tax authorities may have the right to examine prior periods where net operating losses or tax credits were generated and carried forward and make adjustments up to the amount of the net operating loss or credit carryforward.

On August 16, 2022, President Biden signed into law the Inflation Reduction Act of 2022 (the “Act”), which contains provisions that became effective on January 1, 2023, including a 15% corporate minimum tax and a 1% excise tax on stock buybacks. The Company does not currently expect any material changes on its consolidated financial position, results of operations and cash flows.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480990/946-20-50-13

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
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Reference 5: http://www.xbrl.org/2003/role/disclosureRef
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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Reference 10: http://www.xbrl.org/2003/role/disclosureRef
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-Section 50
-Paragraph 2
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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482603/740-30-50-2

+ Details

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Cash flows from operating activities
Net loss	$ (39,238)	$ (49,019)	$ (38,679)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization	2,740	2,753	4,146
Stock-based compensation	15,804	15,078	16,847
Other	6,257	6,345	311
Changes in assets and liabilities:
Accounts receivable, net	(750)	(10,550)	(8,989)
Inventories	42,174	(39,996)	1,001
Prepaid expenses and other assets	8,005	(4,358)	(6,114)
Accounts payable, accrued expenses and other long-term liabilities	(9,347)	10,396	(6,691)
Deferred revenue	1,396	83	14
Operating lease liabilities	(7,688)	(7,007)
Net cash provided by (used in) operating activities	19,353	(76,275)	(38,154)
Cash flows from investing activities
Purchases of short-term investments	0	(12,782)	(65,267)
Proceeds from sales of short-term investments	0	0	27,394
Proceeds from maturities of short-term investments	5,683	49,362	29,470
Purchases of property and equipment	(1,838)	(1,617)	(220)
Purchases of intangible assets	(10)	0	0
Net cash provided by (used in) investing activities	3,835	34,963	(8,623)
Cash flows from financing activities
Proceeds from initial public offering, net of underwriting commissions and discounts	0	0	96,517
Dividends paid	0	0	(35,000)
Proceeds from exercise of stock options	4	122	5,730
Payment of initial public offering costs	0	0	(5,477)
Taxes paid related to net share settlement of equity awards	0	(37)	(567)
Proceeds from ESPP	176	256	291
Payments on finance lease liabilities	(58)	(303)
Payments on finance lease liabilities			(1,126)
Net cash provided by financing activities	122	38	60,368
Net increase (decrease) in cash, cash equivalents and restricted cash	23,310	(41,274)	13,591
Cash, cash equivalents and restricted cash
Beginning of the period	9,517	50,791	37,200
End of the period	32,827	9,517	50,791
Reconciliation of cash, cash equivalents and restricted cash to the consolidated balance sheets
Cash and cash equivalents	32,827	9,517	50,791
Restricted cash, current	0	0	0
Restricted cash, non-current	0	0	0
Total cash, cash equivalents and restricted cash	32,827	9,517	50,791
Supplemental disclosures of cash flow information
Cash paid during the period for interest	1	8	1,797
Cash paid during the period for income taxes	116	101	76
Supplemental disclosures of noncash activities
Equipment acquired under capital lease obligations			123
Capital expenditures included in accounts payable and accrued expenses	$ 25	$ 54	$ 33

Property and Equipment, Net - Additional Information (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Property, Plant and Equipment [Abstract]
Amortization	$ 50	$ 263
Capital lease depreciation expense			$ 400

Redeemable Convertible Preferred Stock and Stockholders’ Deficit (Tables)

12 Months Ended

Dec. 31, 2023

Temporary Equity and Stockholder's Equity Disclosure [Abstract]

Summary of Redeemable Convertible Preferred Stock

The following table summarizes the Company's redeemable convertible preferred stock information as of December 31, 2020:


	Authorized Shares	Issued and Outstanding Shares	Carrying Value		Liquidation Preference
Series A Redeemable Convertible Preferred Stock	11,347,518	11,347,518	$	6,000	$	6,000
Series A-1 Redeemable Convertible Preferred Stock	11,554,016	11,554,016	20,796		21,000
Series B Redeemable Convertible Preferred Stock	4,551,572	4,551,572	42,106		50,000
Series C Redeemable Convertible Preferred Stock	5,174,204	5,174,204	90,586		100,000
Series D Redeemable Convertible Preferred Stock	4,545,944	4,454,624	101,239		101,911
Series E Redeemable Convertible Preferred Stock	6,918,204	6,918,204	67,685		67,815
Series F Redeemable Convertible Preferred Stock	5,100,790	5,100,790	47,992		50,000
Total	49,192,248	49,100,928	$	376,404	$	396,726

Schedule of Common Shares Available for Issuance

As of December 31, 2020, the number of common shares available for issuance under the Company’s amended certificate of incorporation were as follows:


Authorized number of common shares			110,000,000
Common shares outstanding			(34,089,186)
Stock awards outstanding under the 2011 Plan			(18,038,042)
Stock awards available for grant under the 2011 Plan			(2,595,078)
Reserve for the conversion of preferred stock			(49,100,928)
Available for issuance			6,176,766

- Definition

Tabular disclosure of an entity's stock, including par or stated value per share, number and dollar amount of share subscriptions, shares authorized, shares issued, shares outstanding, number and dollar amount of shares held in an employee trust, dividend per share, total dividends, share conversion features, par value plus additional paid in capital, the value of treasury stock and other information necessary to a fair presentation, and EPS information. Stock by class includes common, convertible, and preferred stocks which are not redeemable or redeemable solely at the option of the issuer. Includes preferred stock with redemption features that are solely within the control of the issuer and mandatorily redeemable stock if redemption is required to occur only upon liquidation or termination of the reporting entity. If more than one issue is outstanding, state the title of each issue and the corresponding dollar amount; dollar amount of any shares subscribed but unissued and the deduction of subscriptions receivable there from; number of shares authorized, issued, and outstanding.

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+ Details

Net Income (Loss) per Share Attributable to Common Stockholders - Computation of Basic and Diluted Net Income (Loss) Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands		1 Months Ended	12 Months Ended
	Jun. 29, 2021	Apr. 30, 2021	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Numerator:
Net loss			$ (39,238)	$ (49,019)	$ (38,679)
Add: gain on conversion of preferred stock			0	0	28,994
Less: dividends paid to preferred stockholders			0	0	(20,637)
Net loss attributable to common stockholders - basic			(39,238)	(49,019)	(30,322)
Net loss attributable to common stockholders - diluted			$ (39,238)	$ (49,019)	$ (30,322)
Denominator:
Weighted average shares of common stock outstanding - basic (in shares)			94,516,690	92,201,806	71,126,218
Weighted average shares of common stock outstanding - diluted (in shares)			94,516,690	92,201,806	71,126,218
Net loss per share, attributable to common shareholders:
Basic (in USD per share)			$ (0.42)	$ (0.53)	$ (0.43)
Diluted (in USD per share)			$ (0.42)	$ (0.53)	$ (0.43)
Gain on extinguishment of redeemable convertible preferred stock			$ 0	$ 0	$ 28,994
Cash dividend declared		$ 35,000
Dividends paid to holders of company's redeemable convertible preferred stock	$ 20,600

Nature of Business	12 Months Ended
Nature of Business	Dec. 31, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Nature of Business	Nature of Business The Honest Company, Inc. (the “Company”) was incorporated in the State of California on July 19, 2011 and on May 23, 2012 was re-incorporated in the State of Delaware under the same name. The Company is a personal care company dedicated to creating clean- and sustainably-designed products. The Company sells its products through digital and retail sales channels in the following product categories: Diapers and Wipes, Skin and Personal Care, and Household and Wellness. Initial Public Offering The Company’s registration statement on Form S-1 (“IPO Registration Statement”) related to its initial public offering (“IPO”) was declared effective on May 4, 2021, and the Company’s common stock began trading on the Nasdaq Global Select Market on May 5, 2021. On May 7, 2021, the Company completed its IPO of 25,807,000 shares of the Company's common stock, $0.0001 par value per share at an offering price of $16.00 per share. The Company sold 6,451,613 shares and certain existing stockholders sold an aggregate of 19,355,387 shares. The Company received aggregate net proceeds of approximately $91.0 million after deducting underwriting discounts and commissions of $6.7 million and other offering expenses of $5.5 million. The Company granted the underwriters an option for a period of 30 days to purchase up to an additional 3,871,050 shares of common stock from the selling stockholders at $16.00 per share less the underwriting discounts and commissions. In May 2021, the underwriters fully exercised the option to purchase these additional shares from the selling stockholders. The Company did not receive any proceeds from the sale of shares of its common stock by the selling stockholders. Upon completion of the IPO, the Company paid $9.5 million in cash bonuses to certain employees including members of management, as well as $0.2 million in related payroll taxes and expenses. Cash bonuses of $9.1 million were recorded in sales, general and administrative expenses and $0.4 million were recorded in research and development expenses in the accompanying consolidated statements of comprehensive loss upon completion of the IPO. In April 2021, the Company's board of directors declared a cash dividend of $35.0 million to the holders of record of its common stock and its redeemable convertible preferred stock as of May 3, 2021, which the Company paid on June 29, 2021. Immediately prior to the completion of the IPO, the Company filed an Amended and Restated Certificate of Incorporation, which authorized a total of 1,000,000,000 shares of common stock and 20,000,000 shares of preferred stock. Upon the filing of the Amended and Restated Certificate of Incorporation, 49,100,928 shares of the Company’s redeemable convertible preferred stock then outstanding with a carrying value of $376.4 million were automatically converted into 49,649,023 shares of the Company’s common stock. Upon completion of the IPO, the Company recognized a gain on extinguishment of the redeemable convertible preferred stock for earnings per share purposes of $29.0 million from the conversion of redeemable convertible preferred stock to common stock. Following the completion of the IPO, the Company has one class of authorized and outstanding common stock. See Note 10 "Redeemable Convertible Preferred Stock and Stockholders’ Deficit" for more information on the Company’s redeemable convertible preferred stock as of December 31, 2020.

Revenue

12 Months Ended

Dec. 31, 2023

Revenue from Contract with Customer [Abstract]

Revenue

Disaggregation of Revenue


Revenue by sales channel:	For the year ended December 31,
		2023		2022		2021
(In thousands)
Digital		$	169,015	$	141,403	$	157,546
Retail		175,350		172,248		161,093
Total revenue		$	344,365	$	313,651	$	318,639


Revenue by product category:	For the year ended December 31,
		2023		2022		2021
(In thousands)
Diapers and Wipes		$	218,263	$	200,429	$	200,923
Skin and Personal Care		88,104		89,316		101,697
Household and Wellness		37,998		23,906		16,019
Total revenue		$	344,365	$	313,651	$	318,639

Non-Monetary Transactions

The Company has in the past and may in the future enter into trade agreements with a vendor to exchange excess inventory for future marketing and transportation credits. The Company recognizes revenue reflecting the fair value of the marketing and transportation credits upon delivery of goods, with the corresponding short and long-term asset included in prepaid expenses and other current assets and other assets in the accompanying consolidated balance sheets. The Company may use the marketing and transportation credits over four years from the date of the respective agreement, with an option to extend for another two years if agreed upon by both parties. For the year ended December 31, 2023, the Company did not enter into any new trade agreements.

For the years ended December 31, 2023, 2022 and 2021, the Company recognized $0.0 million, $3.2 million and $4.2 million, respectively, of revenue and $0.0 million, $1.7 million and $2.2 million, respectively, of associated cost of revenue based on the timing of delivery of goods, related to these marketing and transportation credits. The Company assesses the recoverability of the marketing and transportation credits periodically. Factors considered in evaluating the recoverability include management’s history of credit usage and future plans with respect to advertising, freight and other services for which these credits can be used. Any impairment losses are charged to operations as they become determinable. For the years ended December 31, 2023, 2022 and 2021, the Company recorded no impairment losses related to these credits and used an aggregate of $0.3 million, $1.4 million and $0.4 million, respectively, of credits.

- Definition

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

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+ Details

Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2023

Accounting Policies [Abstract]

Basis of Presentation

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). The consolidated financial statements include the accounts of the Company, and its wholly owned subsidiaries after elimination of intercompany transactions and balances.

Restructuring

The Company incurs restructuring costs in connection with the exiting of certain products and geographical locations, workforce reductions, and other actions. Such costs include employee termination benefits (one-time arrangements), termination of contractual obligations, non-cash asset charges, including asset impairments, and other direct incremental costs. The Company records employee termination liabilities once they are both probable and estimable for severance provided under the Company’s existing severance policy. Other costs associated with a restructuring initiative, such as consulting and professional fees, product or geographical exit costs, accelerated amortization associated with a restructuring initiative, are recognized in the period in which the liability is incurred. Accrued restructuring costs are recorded within Accrued Expenses in the consolidated balance sheets.

Stock Split

In April 2021, the Company effected a 1-for-2 forward stock split of its common and redeemable convertible preferred stock. In connection with the forward stock split, each issued and outstanding share of common stock, automatically and without action on the part of the holders, became two shares of common stock and each issued and outstanding share of redeemable convertible preferred stock, automatically and without action on the part of the holders, became two shares of redeemable convertible preferred stock. The par value per share of common and redeemable convertible preferred stock was not adjusted. All share, per share and related information presented in the consolidated financial statements and accompanying notes have been retroactively adjusted, where applicable, to reflect the impact of the stock split.

Segment Reporting and Geographic Information

The Company’s Chief Executive Officer, as the chief operating decision maker, organizes the Company, manages resource allocations, and measures performance on the basis of one operating segment. All of the Company’s long-lived assets are located in the United States and substantially all of the Company’s revenue is from customers located in the United States.

Use of Estimates

The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and contingent liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The Company’s estimates, which are subject to varying degrees of judgment, include the valuation of inventories, sales returns and allowances, allowances for doubtful accounts, valuation of short-term investments, capitalized software, useful lives associated with long-lived assets, incremental borrowing rates associated with leases, valuation allowances with respect to deferred tax assets, accruals and contingencies, recoverability of non-cash marketing credits, recoverability of goodwill and long-lived assets, and the valuation and assumptions underlying stock-based compensation. On an ongoing basis, the Company evaluates its estimates compared to historical experience and trends, which form the basis for making judgments about the carrying value of assets and liabilities.

The Company assessed certain accounting matters and estimates that generally require consideration of forecasted information in context with the information reasonably available to the Company as of December 31, 2023 and through the date these consolidated financial statements were issued. Management is not aware of any specific event or circumstance that would require an update to estimates or judgments or a revision to the carrying value of assets or liabilities. However, these estimates and judgments may change as new events occur and additional information is obtained, which may result in changes being recognized in the Company’s consolidated financial statements in future periods. For example, based on macro trends within our Household and Wellness product category, consumer demand for sanitizing and disinfecting products decreased over the past few years. As a result, the Company made a decision to exit certain elements of these products during the quarter ended March 31, 2023.

Cash and Cash Equivalents

Cash equivalents consist of short-term, highly liquid investments with stated maturities of three months or less from the date of purchase. Cash equivalents comprise amounts invested in money market funds.

Investments

Investments consist of highly liquid investments in debt securities. Investments comprises commercial paper, certificates of deposit, corporate bonds and U.S. government and agency securities, which are classified as available-for-sale investments. The Company includes its available-for-sale investments in current assets because the securities represent investments of cash available for current operations. Available-for-sale investments are recorded at fair value, which is based on quoted market prices for such securities, if available, or is estimated on the basis of quoted market prices of financial instruments with similar characteristics. Unrealized holding gains and losses are excluded from earnings and are reported as a component of comprehensive loss. Realized gains or losses are recorded in interest and other income (expense), net. As of December 31, 2023, the Company did not hold any investments.

The Company evaluates the potential impairment through review of unrealized losses associated with its investments to determine if the impairment is “temporary” or “other-than-temporary.” A “temporary” unrealized loss is recorded in the accumulated other comprehensive loss component of stockholders’ deficit. Such an unrealized loss does not reduce net income for the applicable accounting period because the loss is not viewed as “other-than-temporary”. If the impairment is determined to be “other-than-temporary” the loss is recorded as an impairment charge in the period any such determination is made. The factors evaluated to differentiate between “temporary” and “other-than-temporary” include the projected future cash flows, credit rating actions, and assessment of the credit quality of the underlying collateral, as well as other factors.

Concentrations

Financial instruments that potentially subject the Company to credit risk consist principally of cash, cash equivalents, short-term investments and accounts receivable. The Company places its cash with high credit quality financial institutions, which typically exceed federally insured limits. The Company invests its excess cash primarily in highly rated money market funds and short-term debt instruments, diversifies its investments and, by policy, invests only in highly rated securities to minimize credit risk.

Accounts Receivable

Sales made to consumers through the Company’s Honest.com website are conducted with credit cards, and the Company records its credit card sales in transit as accounts receivable at selling price less applicable deductions. The Company also extends credit in the normal course of business to its third-party ecommerce customers and retailers and performs credit evaluations on a case-by-case basis. The Company does not obtain collateral or other security related to its accounts receivable.

Inventories

Inventories consist of finished goods and are stated at the lower of cost or estimated net realizable value. Cost is computed based on weighted average historical costs. The Company allocates certain overhead costs to the carrying value of its finished goods. The carrying value of inventories is reduced for any excess and obsolete inventory. Excess and obsolete inventory reductions are determined based on assumptions about future demand and sales prices, estimates of the impact of competition, and the age of inventory. If actual conditions are less favorable than those previously estimated by management, additional inventory write-downs could be required.

Property and Equipment, Net

Property and equipment are stated at cost, net of accumulated depreciation and amortization. Repairs and maintenance costs are expensed as incurred. When assets are retired or otherwise disposed of, the cost and the related accumulated depreciation are removed from the respective accounts and any resulting gain or loss is reflected in the consolidated statements of comprehensive loss. Depreciation and amortization are recorded using the straight-line method over the estimated useful lives of the assets as follows:


Machinery and equipment						3-20 years
Computer and office equipment						3-5 years
Capitalized software and website development costs						1-5 years
Furniture and fixtures						3-5 years
Building						40 years
Leasehold improvements						Lesser of the estimated useful life or the remaining lease term

Deferred IPO Costs

Deferred offering costs consisted of costs incurred in connection with the sale of the Company’s common stock in its IPO, including certain legal, accounting, and other IPO-related expenses.

Leases

Effective January 1, 2022, the Company accounts for leases in accordance with Accounting Standards Codification No. 842, Leases (“ASC 842”). The Company’s lease portfolio includes both real estate and non-real estate type leases which are accounted for as either finance or operating leases. Real estate leases generally include office and warehouse facilities and non-real estate leases generally include office equipment and machinery. The Company determines if a contract is or contains a lease at inception. The Company’s leases have remaining lease terms of less than one to six years. Renewal options that are deemed reasonably certain are included as part of the lease term for purposes of calculating the right-of-use ("ROU") assets and lease liability. The Company elected the practical expedient to not separate lease and non-lease components, as such non-lease components are included in the calculation of the ROU asset and lease liability and included in the lease expense over the term of the lease. As most of the Company's leases do not contain an implicit interest rate, the Company uses judgement to determine an incremental borrowing rate to use at lease commencement. Operating lease ROU assets and lease liabilities are recorded on the date the Company takes possession of the leased assets with expense recognized on a straight-line basis over the lease term. Leases with an estimated total term of 12 months or less are not recorded on the balance sheet and the lease expense is recognized on a straight-line basis over the lease term. Generally, the Company’s lease agreements do not contain material residual value guarantees or material restrictive covenants.

Capitalized Software and Website Development Costs

The Company accounts for its internal-use software costs and website development costs in accordance with ASC No. 350-40, Internal-Use Software, and ASC No. 350-50, Website Development Costs, respectively. The Company capitalizes costs to purchase and develop its websites and internal-use software and amortizes such costs on a straight-line basis over the estimated useful life of the software once it is available for its intended use. Capitalization of internal-use costs begins when the preliminary project stage is completed, management with the relevant authority authorizes and commits to the funding of the project, and it is probable that the project will be completed and will be used to perform the function intended. Capitalization of these costs ceases once the project is substantially complete and the software is ready for its intended purpose. Capitalized internal-use software and website development costs, including purchased software, is recorded in property and equipment, net in the consolidated balance sheets.

Goodwill

Goodwill represents the excess of purchase price over the fair value of net assets acquired in a business combination. Goodwill is not amortized but evaluated for impairment at least annually at the reporting unit level or whenever events or changes in circumstances indicate that the value may not be recoverable. Events or changes in circumstances which could trigger an impairment review include significant adverse changes in legal factors or in the business climate, an adverse action or assessment by a regulator, unanticipated competition, a loss of key personnel, significant changes in the manner in which the Company uses the acquired assets or the strategy for the Company’s overall business, significant industry or economic trends, or significant underperformance relevant to expected historical or projected future results of operations.

Goodwill is assessed for possible impairment by performing a qualitative analysis to determine if it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If factors indicate that the fair value of the asset is less

than its carrying amount, the Company will perform a quantitative test by determining the fair value of the reporting unit. The estimated fair value of the reporting unit is based on a projected discounted cash flow model that includes significant assumptions and estimates, including discount rate, growth rate, and future financial performance. Valuations of similar public companies may also be evaluated when assessing the fair value of the reporting unit. If the carrying value of the reporting unit exceeds the fair value, then an impairment loss is recognized for the difference. The Company tests goodwill for impairment annually at October 31.

Intangible Assets, Net

Intangible assets are stated at cost, net of accumulated amortization. Intangible assets consist of tradenames and domain names. Tradenames and domain names are amortized on a straight-line basis, which approximates the pattern in which the economic benefits are consumed, over the estimated useful lives of the assets of 15 years.

Impairment of Long-Lived Assets

The Company assesses the carrying value of its long-lived assets, consisting primarily of property and equipment and intangible assets, when there is evidence that events or changes in circumstances indicate that the carrying value of an asset or group of assets may not be recoverable. Such events or changes in circumstances may include a significant decrease in the market price of a long-lived asset, a significant change in the extent or manner in which an asset is used, a significant change in legal factors or in the business climate, a significant deterioration in the amount of revenue or cash flows expected to be generated from a group of assets, a current expectation that, more likely than not a long-lived asset will be sold or otherwise disposed of significantly before the end of its previously estimated useful life, or any other significant adverse change that would indicate that the carrying value of an asset or group of assets may not be recoverable. The Company performs impairment testing at the asset group level that represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. If events or changes in circumstances indicate that the carrying amount of an asset group may not be recoverable and the expected undiscounted future cash flows attributable to the asset group are less than the carrying amount of the asset group, an impairment loss equal to the excess of the asset’s carrying value over its fair value is recorded.

Income Taxes

Income taxes are accounted for using an asset and liability approach that requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the consolidated financial statements. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial statement and tax basis of assets and liabilities and are measured using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates or tax law on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date.

A valuation allowance is recorded on deferred tax assets when it is determined that it is more likely than not that some portion or all of the net deferred tax assets will not be realized.

The Company recognizes the tax benefit from uncertain tax positions only if it is more likely than not that the tax positions will be sustained on examination by the tax authorities, based on the technical merits of the position. The tax benefit is measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. The Company recognizes interest and penalties related to income tax matters in income tax expense.

Foreign Currency Transactions

Contingent Liabilities

If a potential loss contingency is considered probable, and the amount can be reasonably estimated, the Company accrues a liability for an estimated loss. If the reasonable estimate of the loss is a range and no amount within the range is a better estimate, the minimum amount of the range is recorded as a liability. The Company does not accrue for contingent losses that, in its judgment, are considered to be reasonably possible. However, if the Company determines that a contingent loss is reasonably possible and the loss or range of loss can be estimated, the Company discloses the possible loss in the consolidated financial statements. Legal costs are expensed as incurred.

Stock-Based Compensation

The Company recognizes stock-based compensation expense for employees and non-employees based on the grant-date fair value of stock award over the applicable service period. For awards that vest based on continued service, stock-based

compensation cost is recognized on a straight-line basis over the requisite service period, which is generally the vesting period of the awards. For awards with performance vesting conditions, stock-based compensation cost is recognized on a graded vesting basis over the requisite service period when it is probable the performance condition will be achieved. The grant date fair value of restricted stock awards that contain service vesting conditions is estimated based on the fair value of the underlying shares on the grant date, with a cumulative adjustment for the portion of the service period that occurred for the period prior to the performance condition becoming probable of being achieved.

For awards that contain service, performance or a combination of both vesting conditions, the grant date fair value of restricted stock award is estimated based on the fair value of the underlying shares on grant date while the Black-Scholes option-pricing model is used to estimate the grant date fair value of stock option awards.

For stock option awards that contain service, performance and market vesting conditions, where the performance condition is an initial public offering or a change in control event, performance condition is not probable of being achieved for accounting purposes until the event occurs. Thereafter, stock-based compensation expense is recognized when the event occurs even if the market condition was not or is not achieved, provided the employee continues to satisfy the service condition.

The Monte Carlo simulation model is used to estimate the fair value of stock options that have market vesting conditions. Determining the fair value of stock option awards requires judgment and the assumptions used in the option-pricing models require the input of subjective assumptions which are as follows:

• Fair value - Prior to the Company's IPO, the fair value of the common stock underlying the Company’s stock-based awards was determined by the Company’s Board of Directors (the “Board”). The Company’s Board determined the common stock fair value at the stock option grant date by considering several objective and subjective factors, including the price paid for its common and preferred stock, actual and forecasted operating and financial performance, market conditions and performance of comparable publicly traded companies, developments and milestones within the Company, the rights, preferences, and privileges of its common and preferred stock, and the likelihood of achieving a liquidity event. Subsequent to the Company's IPO, the fair value of the Company's common stock is determined based on the closing stock price on the date of grant.

• Expected volatility - Expected volatility is based on historical volatilities of a publicly traded peer group based on weekly price observations over a period equivalent to the expected term of the stock option grants.

• Expected term - For stock options with only service vesting conditions the expected term is determined using the simplified method, which estimates the expected term using the contractual life of the option and the vesting period. For stock options with performance or market conditions, the term is estimated in consideration of the time period expected to achieve the performance or market condition, the contractual term of the award, and estimates of future exercise behavior.

• Risk-free interest rate - The risk-free interest rate is based on the U.S. Treasury yield of treasury bonds with a maturity that approximates the expected term of the options.

• Expected dividend yield - The dividend yield is based on the Company’s current expectations of dividend payouts. The Company has never declared or paid any cash dividends on its common stock, and the Company does not anticipate paying any cash dividends in the foreseeable future.

The determination of stock-based compensation cost is inherently uncertain and subjective and involves the application of valuation models and assumptions requiring the use of judgment. If the Company had made different assumptions, its stock-based compensation expense and its net loss could have been significantly different.

New shares are issued from authorized shares of common stock upon the exercise of stock options.

Fair Value Measurements

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company uses the following hierarchy in measuring the fair value of the Company’s assets and liabilities, focusing on the most observable inputs when available:

Level 1 - Quoted prices in active markets for identical assets or liabilities.

Level 2 - Observable inputs other than Level 1 quoted prices, such as quoted prices for similar assets and liabilities in active markets, quoted prices in markets that are not active for identical or similar assets and liabilities, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3 - Valuations are based on inputs that are unobservable and significant to the overall fair value measurement of the assets or liabilities. Inputs reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model.

Fair value is based on quoted market prices, if available. If listed prices or quotes are not available, fair value is based on internally developed models that primarily use market-based or independently sourced market parameters as inputs. Cash equivalents, consisting primarily of money market funds, represent highly liquid investments with maturities of three months or less at purchase. Market prices, which are Level 1 in the fair value hierarchy, are used to determine the fair value of the money market funds. Investments in debt securities are measured using broker provided indicative prices developed using observable market data, which are considered Level 2 in the fair value hierarchy. Certain assets, including long-lived assets, goodwill and intangible assets are also subject to measurement at fair value on a non-recurring basis if they are deemed to be impaired as a result of an impairment review. The fair value is measured using Level 3 inputs in the fair value hierarchy.

Revenue Recognition and Cost of Revenue

Revenue Recognition

The Company sells its products through digital and retail sales channels in the following product categories: Diapers and Wipes, Skin and Personal Care, and Household and Wellness. The digital sales channel includes direct-to-consumer sales through the Company’s website and sales to third-party ecommerce customers, who resell the Company’s products through their own online platforms. The retail sales channel includes sales to traditional brick and mortar retailers, who may also resell the Company’s products through their own online platforms.

The Company accounts for revenue contracts with customers by applying the following steps in accordance with ASC No. 606, Revenue from Contracts with Customers:

• Identification of the contract, or contracts, with a customer

• Identification of the performance obligations in the contract

• Determination of the transaction price

• Allocation of the transaction price to the performance obligations in the contract

• Recognition of revenue when, or as, the Company satisfies a performance obligation

The Company elected as an accounting policy to record all shipping and handling costs as fulfillment costs. The Company accrues the cost of shipping and handling and recognizes revenue and costs at the point in time that control of the goods transfers to the customer.

Direct-to-Consumer

For direct sales to the consumer through the Company’s website, the Company’s performance obligation consists of the sale of finished goods to the consumer. Consumers may purchase products at any time or enter into subscription arrangements. Consumers place orders online in accordance with the Company’s standard terms and conditions and authorize payment when the order is placed. Credit cards are charged at the time of shipment. For subscription arrangements, consumers sign up to receive products on a periodic basis. Subscriptions are cancellable at any time without penalty, and no amounts are collected from the consumer until products are shipped. Revenue is recognized when transfer of control to the consumer takes place which is when the product is delivered to the carrier. Sales taxes collected from consumers are accounted for on a net basis and are excluded from revenue.

Consumers may purchase gift cards, which are recorded as deferred revenue at the time of purchase. The Company recognizes revenue when these gift cards are redeemed for products and the revenue recognition criteria as described above have been met. For the years ended December 31, 2023, 2022 and 2021, revenue recognized from the use of gift cards was $0.6 million, $0.8 million and $0.9 million, respectively. As of December 31, 2023 and 2022, deferred revenue related to gift card purchases was $1.0 million and $0.8 million, respectively.

Retail and Third-Party Ecommerce

For retail and third-party ecommerce sales, the Company’s performance obligation consists of the sale of finished goods to retailers and third-party ecommerce customers. Revenue is recognized when control of the promised goods is transferred to those customers at time of shipment or delivery, depending on the contract terms. After the completion of the performance obligation, the Company has the right to consideration as outlined in the contract. Payment terms vary among the retail and third-party ecommerce customers although terms generally include a requirement of payment within 30 to 45 days of product shipment.

Sales Returns and Allowances

For direct-to-consumer, retail, and third-party ecommerce sales, the Company records estimated sales returns in the same period that the related revenue is recorded. The Company uses the expected value method to estimate returns, taking into consideration assumptions of demand based on historical data and historical returns rates. When estimating returns, the Company also considers future business initiatives and relevant anticipated future events. Estimated sales returns and ultimate losses may

vary from actual results, which could be material to the consolidated financial statements. The estimated sales returns allowance is recorded as a reduction of revenue.

For direct-to-consumer, retail and third-party ecommerce sales, the Company offers credits in the form of discounts, which are recorded as reductions in revenue and are allocated to products on a relative basis based on their respective standalone selling price.

For retail and third-party ecommerce sales, the Company routinely commits to one-time or ongoing sales incentive programs with its customers that may require the Company to estimate and accrue the expected costs of such programs, including trade promotion activities and contractual allowances. The Company records these programs as a reduction to revenue unless it receives a distinct benefit in exchange for credits claimed by the customer and can reasonably estimate the fair value of the benefit received, in which case the Company records it as a marketing expense. The Company recognizes a liability or a reduction to accounts receivable, and reduces revenue based on the estimated amount of credits that will be claimed by customers. An allowance is recorded as a reduction to accounts receivable if the customer can deduct the program amount from outstanding invoices.

Estimates for these sales incentive programs are developed using the most likely amount and are included in the transaction price to the extent that a significant reversal of revenue would not result once the uncertainty is resolved. In developing its estimate, the Company uses historical analysis and contractual rates in determining the accruals for these activities. The Company also considers the susceptibility of the incentive to outside influences, the length of time until the uncertainty is resolved and the Company’s experience with similar contracts. Judgment is required to determine the timing and amount of recognition of sales incentive program accruals which the Company estimates based on past practice with similar arrangements.

Cost of Revenue

Cost of revenue includes the purchase price of merchandise sold to customers, inbound and outbound shipping and handling costs, freight and duties, shipping and packaging supplies, credit card processing fees and warehouse fulfillment costs incurred in operating and staffing warehouses, including rent. Cost of revenue also includes depreciation and amortization, allocated overhead and direct and indirect labor for warehouse personnel.

Selling, General and Administrative

Selling, general and administrative expenses consist primarily of personnel costs, principally for our selling and administrative functions. These include personnel-related expenses, including salaries, bonuses, benefits and stock-based compensation expense. Selling, general and administrative expenses also include technology expenses, professional fees, facility costs, including insurance, utilities and rent relating to our headquarters, depreciation and amortization, and overhead costs.

Marketing

Marketing expenses includes costs related to the Company’s branding initiatives, retail customer marketing activities, point of purchase displays, targeted online advertising through sponsored search, display advertising, email marketing campaigns, market research, content production and other public relations and promotional initiatives.

Research and Development

Research and development expenses relate to costs incurred for the development of new products, improvement in the quality of existing products and the development and implementation of new technologies to enhance the quality and value of products. Research and development expenses consist primarily of personnel-related expenses, including salaries, bonuses, benefits and stock-based compensation expense. Research and development expenses also include allocated depreciation and amortization and overhead costs. The Company expenses research and development costs in the period they are incurred.

Recent Accounting Pronouncements

As an “emerging growth company,” the Jumpstart Our Business Startups Act, allows the Company to delay adoption of new or revised accounting pronouncements applicable to public companies until such pronouncements are made applicable to private companies. The Company has elected to use the adoption dates applicable to private companies. As a result, the Company’s financial statements may not be comparable to the financial statements of issuers who are required to comply with the effective date for new or revised accounting standards that are applicable to public companies.

Recently Adopted Accounting Pronouncements

In June 2016, the Financial Accounting Standard Board ("FASB") issued Accounting Standard Update ("ASU") No. 2016-13, Financial Instruments Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, to amend the accounting for credit losses for certain financial instruments. This guidance replaces the incurred loss impairment methodology with a methodology that reflects expected credit losses. In November 2019, FASB issued ASU No. 2019-10 which delayed the effective dates of the guidance. This guidance is effective for public business entities that meet the definition of an SEC filer, excluding entities eligible to be smaller reporting companies (“SRC”) for fiscal years beginning after December 15, 2019 and all other entities for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Early adoption is permitted for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Effective January 1, 2023, the Company adopted this standard, which did not have a material impact on the Company’s consolidated financial statements.

Recently Issued Accounting Pronouncements – Not Yet Adopted

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which expands reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. The amendments in the ASU require that a public entity discloses, on an annual and interim basis, significant segment expenses that are regularly provided to an entity's chief operating decision maker ("CODM"), a description of other segment items by reportable segment, and any additional measures of a segment's profit or loss used by the CODM when deciding how to allocate resources. The amendments in this ASU are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Retrospective application is required for all prior periods presented, and early adoption is permitted. The Company does not expect the adoption of ASU No. 2023-07 to have a material impact on the Company’s consolidated financial statements or disclosures.

In December 2023, the FASB issued ASU No. 2023-09, Income Taxes: Improvements to Income Tax Disclosures. This guidance requires consistent categories and greater disaggregation of information in the rate reconciliation and disclosures of income taxes paid by jurisdiction. For public business entities, the amendments in this update are effective for annual periods beginning after December 15, 2024. The Company does not expect the adoption of ASU No. 2023-09 to have a material impact on the Company’s consolidated financial statements or disclosures.

Accrued Expenses (Tables)

12 Months Ended

Dec. 31, 2023

Payables and Accruals [Abstract]

Schedule of Accrued Expenses

Accrued expenses consisted of the following:


	As of December 31,
	2023		2022
(In thousands)
Payroll and payroll related expenses(1)	$	8,007	$	6,790
Accrued inventory purchases	9,368		17,050
Accrued returns	269		318
Accrued rent(2)	8,105		7,688
Accrued restructuring(3)	356		—
Other accrued expenses	6,104		6,164
Total accrued expenses	$	32,209	$	38,010

_______________

(1) Includes $1.2 million and $4.3 million of Chief Executive Officer and Chief Financial Officer executive transition related expense as of December 31, 2023 and 2022, respectively.

(2) Represents short-term operating lease liabilities. Refer to Note 16, "Leases" included in these consolidated financial statements for more information on leases.

(3) Refer to Note 17, "Restructuring" included in these consolidated financial statements for more information on the Company's restructuring initiative.

Income Taxes - Schedule of Deferred Tax (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Deferred tax assets
Intangible assets	$ 75	$ 95
Property and equipment	867	815
Accrued expenses	1,488	653
Deferred revenue	113	51
Allowances, reserves and other	2,013	2,796
Stock-based compensation	7,728	8,335
Section 174 capitalized expenses	4,346	1,456
Net operating loss and other carryforwards	87,327	85,176
Total deferred tax assets	103,957	99,377
Valuation allowance	(98,771)	(94,103)	$ (86,659)	$ (84,934)
Net deferred tax assets	5,186	5,274
Deferred tax liabilities
Prepaid expenses	(376)	(364)
State taxes	(4,810)	(4,910)
Total deferred tax liabilities	(5,186)	(5,274)
Net deferred taxes	$ 0	$ 0

Summary of Significant Accounting Policies - Schedule of Concentration Risk (Details) - Customer Concentration Risk	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Accounts Receivable \| Customer A
Concentration Risk [Line Items]
Concentration risk, percentage	49.00%	44.00%
Accounts Receivable \| Customer B
Concentration Risk [Line Items]
Concentration risk, percentage	25.00%	15.00%
Revenue from Contract with Customer Benchmark \| Customer A
Concentration Risk [Line Items]
Concentration risk, percentage	31.00%	31.00%	28.00%
Revenue from Contract with Customer Benchmark \| Customer B
Concentration Risk [Line Items]
Concentration risk, percentage	30.00%	19.00%	22.00%

Accrued Expenses

12 Months Ended

Dec. 31, 2023

Payables and Accruals [Abstract]

Accrued Expenses

Accrued expenses consisted of the following:


	As of December 31,
	2023		2022
(In thousands)
Payroll and payroll related expenses(1)	$	8,007	$	6,790
Accrued inventory purchases	9,368		17,050
Accrued returns	269		318
Accrued rent(2)	8,105		7,688
Accrued restructuring(3)	356		—
Other accrued expenses	6,104		6,164
Total accrued expenses	$	32,209	$	38,010

_______________

(1) Includes $1.2 million and $4.3 million of Chief Executive Officer and Chief Financial Officer executive transition related expense as of December 31, 2023 and 2022, respectively.

(2) Represents short-term operating lease liabilities. Refer to Note 16, "Leases" included in these consolidated financial statements for more information on leases.

(3) Refer to Note 17, "Restructuring" included in these consolidated financial statements for more information on the Company's restructuring initiative.

Restructuring - Please update to "Schedule of Changes in Accrued Expenses Relating to Transformation Initiative (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2023 USD ($)
Transformation Initiative
Restructuring Reserve [Roll Forward]
Balance at December 31, 2022	$ 0
Charges (adjustments)	6,787
Cash payments	(1,765)
Non-cash asset write-offs	(2,085)
Balance at December 31, 2023	2,937
Employee-Related Costs
Restructuring Reserve [Roll Forward]
Balance at December 31, 2023	400
Employee-Related Costs \| Transformation Initiative
Restructuring Reserve [Roll Forward]
Balance at December 31, 2022	0
Charges (adjustments)	1,142
Cash payments	(786)
Non-cash asset write-offs	0
Balance at December 31, 2023	356
Contract Terminations \| Transformation Initiative
Restructuring Reserve [Roll Forward]
Balance at December 31, 2022	0
Charges (adjustments)	479
Cash payments	(479)
Non-cash asset write-offs	0
Balance at December 31, 2023	0
Inventory Reserves \| Transformation Initiative
Restructuring Reserve [Roll Forward]
Balance at December 31, 2022	0
Charges (adjustments)	5,166
Cash payments	(500)
Non-cash asset write-offs	(2,085)
Balance at December 31, 2023	$ 2,581

Summary of Significant Accounting Policies - Additional Information (Details)		1 Months Ended	12 Months Ended
	Oct. 31, 2023 USD ($)	Apr. 30, 2021	Dec. 31, 2023 USD ($) segment	Dec. 31, 2022 USD ($)	Dec. 31, 2021 USD ($)	May 07, 2021 USD ($)	Dec. 31, 2020 USD ($)
Class of Stock [Line Items]
Number of operating segments \| segment			1
Allowance for credit losses			$ 400,000	$ 500,000
Deferred offering costs						$ 5,500,000
Capitalized implementation costs from cloud computing			1,100,000	1,000,000
Capitalized implementation costs from cloud computing, accumulated amortization			$ 2,400,000	1,800,000
Goodwill impairment	$ 0
Intangible asset, estimated useful life			15 years
Realized and unrealized foreign currency losses			$ 0	200,000	$ 100,000
Deferred revenue			2,212,000	815,000
Deferred advertising, current			400,000	1,600,000
Advertising expense			33,800,000	44,800,000	49,200,000
Sales Incentive Program
Class of Stock [Line Items]
Allowance for sales incentive program			8,380,000	6,396,000	6,494,000		$ 8,207,000
Accounts Receivable \| Sales Incentive Program
Class of Stock [Line Items]
Allowance for sales incentive program			$ 6,800,000	5,800,000
Minimum
Class of Stock [Line Items]
Lessee, finance lease, remaining lease term			1 year
Lessee, operating lease, remaining lease term			1 year
Deferred advertising, amortization period			1 year
Maximum
Class of Stock [Line Items]
Lessee, finance lease, remaining lease term			6 years
Lessee, operating lease, remaining lease term			6 years
Deferred advertising, amortization period			3 years
Sales Channel, Directly to Consumer
Class of Stock [Line Items]
Deferred revenue			$ 1,000,000	800,000
Gift Card \| Sales Channel, Directly to Consumer
Class of Stock [Line Items]
Revenue recognized			$ 600,000	$ 800,000	$ 900,000
Retail \| Minimum
Class of Stock [Line Items]
Revenue recognition, payment term			30 days
Retail \| Maximum
Class of Stock [Line Items]
Revenue recognition, payment term			45 days
Common Stock
Class of Stock [Line Items]
Stock split ratio		0.5
Redeemable Convertible Preferred Stock
Class of Stock [Line Items]
Stock split ratio		0.5

Redeemable Convertible Preferred Stock and Stockholders’ Deficit - Summary of Redeemable Convertible Preferred Stock Information (Details) - USD ($) $ in Thousands	Dec. 31, 2021	May 06, 2021	Dec. 31, 2020
Temporary Equity [Line Items]
Authorized Shares (in shares)			49,192,248
Issued (in shares)			49,100,928
Outstanding (in shares)	0	49,100,928	49,100,928
Carrying Value	$ 0	$ 376,400	$ 376,404
Liquidation Preference			$ 396,726
Series A Redeemable Convertible Preferred Stock
Temporary Equity [Line Items]
Authorized Shares (in shares)			11,347,518
Issued (in shares)			11,347,518
Outstanding (in shares)			11,347,518
Carrying Value			$ 6,000
Liquidation Preference			$ 6,000
Series A-1 Redeemable Convertible Preferred Stock
Temporary Equity [Line Items]
Authorized Shares (in shares)			11,554,016
Issued (in shares)			11,554,016
Outstanding (in shares)			11,554,016
Carrying Value			$ 20,796
Liquidation Preference			$ 21,000
Series B Redeemable Convertible Preferred Stock
Temporary Equity [Line Items]
Authorized Shares (in shares)			4,551,572
Issued (in shares)			4,551,572
Outstanding (in shares)			4,551,572
Carrying Value			$ 42,106
Liquidation Preference			$ 50,000
Series C Redeemable Convertible Preferred Stock
Temporary Equity [Line Items]
Authorized Shares (in shares)			5,174,204
Issued (in shares)			5,174,204
Outstanding (in shares)			5,174,204
Carrying Value			$ 90,586
Liquidation Preference			$ 100,000
Series D Redeemable Convertible Preferred Stock
Temporary Equity [Line Items]
Authorized Shares (in shares)			4,545,944
Issued (in shares)			4,454,624
Outstanding (in shares)			4,454,624
Carrying Value			$ 101,239
Liquidation Preference			$ 101,911
Series E Redeemable Convertible Preferred Stock
Temporary Equity [Line Items]
Authorized Shares (in shares)			6,918,204
Issued (in shares)			6,918,204
Outstanding (in shares)			6,918,204
Carrying Value			$ 67,685
Liquidation Preference			$ 67,815
Series F Redeemable Convertible Preferred Stock
Temporary Equity [Line Items]
Authorized Shares (in shares)			5,100,790
Issued (in shares)			5,100,790
Outstanding (in shares)			5,100,790
Carrying Value			$ 47,992
Liquidation Preference			$ 50,000

Net Income (Loss) per Share Attributable to Common Stockholders - Potentially Dilutive Shares Excluded From Computation of Diluted Net Income (Loss) Per Share (Details) - shares	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	21,643,391	19,568,799	19,450,563
Stock options to purchase common stock
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	13,315,796	14,888,007	16,440,539
Unvested restricted stock units
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	8,256,453	4,618,354	2,970,867
Employee stock purchase plan
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	71,142	62,438	39,157

Audit Information	12 Months Ended
Audit Information	Dec. 31, 2023
Audit Information [Abstract]
Auditor Firm ID	238
Auditor Name	PricewaterhouseCoopers
Auditor Location	Los Angeles, California

Redeemable Convertible Preferred Stock and Stockholders’ Deficit

12 Months Ended

Dec. 31, 2023

Temporary Equity and Stockholder's Equity Disclosure [Abstract]

Redeemable Convertible Preferred Stock and Stockholders’ Deficit

Immediately prior to the completion of the IPO, the Company filed an Amended and Restated Certificate of Incorporation, which authorized a total of 1,000,000,000 shares of common stock and 20,000,000 shares of preferred stock. Upon the filing of the Amended and Restated Certificate of Incorporation, 49,100,928 shares of the Company’s redeemable convertible preferred stock then outstanding with a carrying value of $376.4 million were automatically converted into 49,649,023 shares of the Company’s common stock. Upon completion of the IPO, the Company recognized a gain on extinguishment of the redeemable convertible preferred stock for earnings per share purposes of $29.0 million from the conversion of redeemable convertible preferred stock to common stock. Following the completion of the IPO, the Company has one class of authorized and outstanding common stock.

The following table summarizes the Company's redeemable convertible preferred stock information as of December 31, 2020:


	Authorized Shares	Issued and Outstanding Shares	Carrying Value		Liquidation Preference
Series A Redeemable Convertible Preferred Stock	11,347,518	11,347,518	$	6,000	$	6,000
Series A-1 Redeemable Convertible Preferred Stock	11,554,016	11,554,016	20,796		21,000
Series B Redeemable Convertible Preferred Stock	4,551,572	4,551,572	42,106		50,000
Series C Redeemable Convertible Preferred Stock	5,174,204	5,174,204	90,586		100,000
Series D Redeemable Convertible Preferred Stock	4,545,944	4,454,624	101,239		101,911
Series E Redeemable Convertible Preferred Stock	6,918,204	6,918,204	67,685		67,815
Series F Redeemable Convertible Preferred Stock	5,100,790	5,100,790	47,992		50,000
Total	49,192,248	49,100,928	$	376,404	$	396,726

Shares Available for Issuance

As of December 31, 2021, there were no shares of Series A, Series A-1, Series B, Series C, Series D, Series E, or Series F redeemable convertible preferred stock available for issuance. As of December 31, 2020, the number of common shares available for issuance under the Company’s amended certificate of incorporation were as follows:


Authorized number of common shares			110,000,000
Common shares outstanding			(34,089,186)
Stock awards outstanding under the 2011 Plan			(18,038,042)
Stock awards available for grant under the 2011 Plan			(2,595,078)
Reserve for the conversion of preferred stock			(49,100,928)
Available for issuance			6,176,766

Income Taxes - Summary of Changes in Valuation Allowance (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Deferred Tax Asset, Valuation Allowance [Roll Forward]
Beginning balance	$ 94,103	$ 86,659	$ 84,934
Increase to valuation allowance	4,654	8,047	1,737
Other increases (decreases)	14	10	(12)
Ending balance	$ 98,771	94,103	86,659
Accounting Standards Update 2016-02
Deferred Tax Asset, Valuation Allowance [Roll Forward]
Beginning balance		$ (613)
Ending balance			$ (613)

Stock-Based Compensation - 2021 Equity Incentive Plan (Details) - shares	1 Months Ended
	Apr. 30, 2021	Jan. 01, 2022	Apr. 01, 2021	Dec. 31, 2020
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of common stock authorized to be issued (in shares)				6,176,766
2021 Equity Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Maximum number of shares that may be issued (in shares)	75,100,000		25,025,580
Period to increase available shares for issuance	10 years
Percentage of total number of shares outstanding	4.00%
Number of common stock authorized to be issued (in shares)		3,713,026

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References

+ Details

Restructuring - Narrative (Details) $ in Millions	Dec. 31, 2023 USD ($)
Employee-Related Costs
Restructuring Cost and Reserve [Line Items]
Restructuring reserve	$ 0.4

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References + Details

Restructuring

12 Months Ended

Dec. 31, 2023

Restructuring and Related Activities [Abstract]

Restructuring

Transformation Initiative

In 2023, the Company executed a broad-based Transformation Initiative designed to build the Honest brand and drive growth in higher-margin areas of the portfolio, strengthen the Company’s cost structure, drive focus on the most productive areas of our business, deliver greater impact from brand-building investments, and improve executional excellence across the enterprise.

Restructuring costs are one of the elements of the Transformation Initiative and are included in restructuring on the consolidated statements of comprehensive loss:

•Employee-Related Costs – Employee-related costs are primarily comprised of severance and other post-employment benefit costs, calculated based on salary levels, prior service and other statutory minimum benefits, if applicable.

•Asset-Related Costs – Asset-related costs consist of accelerated amortization related to visual merchandise in an international retail store taken out of service prior to its existing useful life as a direct result of the restructuring initiatives, as well as asset impairments related to technology taken out of service.

•Contract Terminations – Costs related to contract terminations include continuing payments to a third-party after the Company has ceased benefiting from the rights conveyed in the contract, or a payment made to terminate a contract prior to its expiration.

Other costs associated with the Transformation Initiative are comprised of the following:

•Sales Returns and Cost of Revenue – Product returns, chargebacks and markdowns are recorded as a reduction to revenue and inventory write-offs, write-downs or destruction costs as a direct result of the restructuring initiatives to exit certain products or geographic locations are recorded as a component of cost of revenue on the consolidated statements of comprehensive loss when estimable and reasonably assured.

•Other Costs – The Company incurred other costs related to the restructuring initiatives, which are included in selling, general and administrative expense on the consolidated statements of comprehensive loss and primarily include the following:

▪Donation expenses related to inventory reserves, including tariffs, and

▪Consulting and other professional services.


	Restructuring Costs
	Employee-Related Costs		Asset-Related Costs		Contract Terminations		Total

Charges for the year ended December 31, 2023	$	1,142	$	193	$	870	$	2,205

Changes in accrued expenses as of December 31, 2023 relating to the Transformation Initiative were:


	Restructuring Costs
	Employee-Related Costs(1)		Contract Terminations		Inventory Reserves		Total
Balance at December 31, 2022	$	—	$	—	$	—	$	—
Charges (adjustments)	1,142		479		5,166		6,787
Cash payments	(786)		(479)		(500)		(1,765)
Non-cash asset write-offs	—		—		(2,085)		(2,085)
Balance at December 31, 2023	$	356	$	—	$	2,581	$	2,937

___________

(1) Included in accrued expenses as of December 31, 2023. Refer to Note 9, "Accrued Expenses" included elsewhere in these consolidated financial statements.

The Company records costs associated with the restructuring initiatives once the relevant accounting criteria have been met. Accrued restructuring costs of $0.4 million related to severance costs as of December 31, 2023 are expected to result in cash expenditures funded from cash provided by operations in future periods and is included in accrued expenses on the consolidated balance sheets.

Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders’ Equity (Deficit) - USD ($) $ in Thousands	Total	Cumulative Effect, Period of Adoption, Adjustment	Common Stock	Additional Paid-in Capital	Accumulated Deficit	Accumulated Deficit Cumulative Effect, Period of Adoption, Adjustment	Accumulated Other Comprehensive Income (Loss)
Beginning balance (in shares) at Dec. 31, 2020	49,100,928
Beginning balance at Dec. 31, 2020	$ 376,404
Increase (Decrease) in Temporary Equity [Roll Forward]
Conversion of redeemable convertible preferred stock to common stock upon initial public offering (in shares)	(49,100,928)
Conversion of redeemable convertible preferred stock to common stock upon initial public offering	$ (376,404)
Ending balance (in shares) at Dec. 31, 2021	0
Ending balance at Dec. 31, 2021	$ 0
Beginning balance (in shares) at Dec. 31, 2020			34,089,186
Beginning balance at Dec. 31, 2020	(236,825)		$ 3	$ 116,055	$ (352,977)		$ 94
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(38,679)				(38,679)
Other comprehensive loss	(135)						(135)
Stock options exercised (in shares)			1,170,803
Stock options exercised	5,730			5,730
Stock-based compensation	16,847			16,847
Vested restricted stock units (in shares)			173,835
Dividends paid	(35,000)			(35,000)
Issuance of common stock pursuant to initial public offering, net of underwriting commissions and discounts and offering costs of $12.2 million (in shares)			6,451,613
Issuance of common stock pursuant to initial public offering, net of underwriting commissions and discounts and offering costs of $12.2 million	91,039		$ 1	91,038
Conversion of redeemable convertible preferred stock to common stock upon initial public offering (in shares)			49,649,023
Conversion of redeemable convertible preferred stock to common stock upon initial public offering	376,405		$ 5	376,400
Shares withheld related to net share settlement of equity awards (in shares)			(61,810)
Common stock withheld for tax obligation and net settlement	(567)			(567)
Shares issued under employee stock purchase plan (in shares)			39,490
Shares issued under employee stock purchase plan	291			291
Ending balance (in shares) at Dec. 31, 2021			91,512,140
Ending balance at Dec. 31, 2021	$ 179,106	$ 845	$ 9	570,794	(391,656)	$ 845	(41)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Accounting Standards Update [Extensible Enumeration]	Accounting Standards Update 2016-02
Net loss	$ (49,019)				(49,019)
Other comprehensive loss	$ 9						9
Stock options exercised (in shares)	43,556		43,556
Stock options exercised	$ 122			122
Stock-based compensation	15,078			15,078
Vested restricted stock units (in shares)			1,263,963
Shares withheld related to net share settlement of equity awards (in shares)			(8,050)
Common stock withheld for tax obligation and net settlement	(37)			(37)
Shares issued under employee stock purchase plan (in shares)			95,742
Shares issued under employee stock purchase plan	$ 256			256
Ending balance (in shares) at Dec. 31, 2022	92,907,351		92,907,351
Ending balance at Dec. 31, 2022	$ 146,360		$ 9	586,213	(439,830)		(32)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(39,238)				(39,238)
Other comprehensive loss	$ 32						32
Stock options exercised (in shares)	2,300		2,300
Stock options exercised	$ 4			4
Stock-based compensation	15,804			15,804
Vested restricted stock units (in shares)			2,831,801
Shares issued under employee stock purchase plan (in shares)			126,969
Shares issued under employee stock purchase plan	$ 177			177
Ending balance (in shares) at Dec. 31, 2023	95,868,421		95,868,421
Ending balance at Dec. 31, 2023	$ 123,139		$ 9	$ 602,198	$ (479,068)		$ 0

Stock-Based Compensation - RSU Awards (Details) - Unvested restricted stock units - $ / shares	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Non-Employee Directors
Number of Shares
Unvested RSUs, beginning balance (in shares)	452,951	103,561
Transfer from Employee to Non-Employee Director (in shares)	1,147,566
Granted (in shares)	1,376,563	485,806
Vested (in shares)	(1,382,224)	(131,775)
Forfeited (in shares)	(637,657)	(4,641)
Unvested RSUs, ending balance (in shares)	957,199	452,951
Weighted Average Grant Date Fair Value Per Share
Unvested RSUs, beginning balance (in USD per share)	$ 3.44	$ 16.00
Transfer from Employee to Non-Employee Director (in dollars per share)	9.02
Granted (in USD per share)	2.01	3.51
Vested (in USD per share)	5.84	13.38
Forfeited (in USD per share)	7.07	8.09
Unvested RSUs, ending balance (in USD per share)	$ 2.19	$ 3.44
Directors, Officers and Employees
Number of Shares
Unvested RSUs, beginning balance (in shares)	4,165,403	2,867,306
Transfer from Employee to Non-Employee Director (in shares)	(1,147,566)
Granted (in shares)	7,505,557	3,113,741
Vested (in shares)	(1,449,577)	(1,121,573)
Forfeited (in shares)	(1,774,563)	(694,071)
Unvested RSUs, ending balance (in shares)	7,299,254	4,165,403
Weighted Average Grant Date Fair Value Per Share
Unvested RSUs, beginning balance (in USD per share)	$ 8.09	$ 13.58
Transfer from Employee to Non-Employee Director (in dollars per share)	9.02
Granted (in USD per share)	1.71	5.07
Vested (in USD per share)	6.31	12.20
Forfeited (in USD per share)	5.44	10.54
Unvested RSUs, ending balance (in USD per share)	$ 2.38	$ 8.09

Consolidated Balance Sheets (Parenthetical) - $ / shares	Dec. 31, 2023	Dec. 31, 2022
Stockholders’ equity
Preferred stock, par value (in USD per share)	$ 0.0001	$ 0.0001
Preferred stock authorized (in shares)	20,000,000	20,000,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Common stock, par value (in USD per share)	$ 0.0001	$ 0.0001
Common stock authorized (in shares)	1,000,000,000	1,000,000,000
Common stock issued (in shares)	95,868,421	92,907,351
Common stock outstanding (in shares)	95,868,421	92,907,351

Commitment and Contingencies (Tables)

12 Months Ended

Dec. 31, 2023

Commitments and Contingencies Disclosure [Abstract]

Contractual Obligation, Fiscal Year Maturity

Future minimum payments under these unconditional purchase commitments are as follows:


(In thousands)
Years Ending December 31,
2024	$	3,369
2025	1,145
2026	474
2027	174
2028	—
Thereafter	—
Future minimum payments	$	5,162

Net Income (Loss) per Share Attributable to Common Stockholders

12 Months Ended

Dec. 31, 2023

Earnings Per Share [Abstract]

Net Income (Loss) per Share Attributable to Common Stockholders

The Company computes net income (loss) per share using the two-class method required for participating securities. The two-class method requires net income be allocated between common stock and participating securities based upon their respective rights to receive dividends as if all income for the period had been distributed. In periods where the Company has net losses, losses are not allocated to participating securities as they are not required to fund the losses. The Company considered its redeemable convertible preferred stock to be participating securities as preferred stockholders have rights to participate in dividends with the common stockholders.

Basic net income (loss) attributable to common stockholders per share is calculated by dividing net income (loss) attributable to common stockholders by the weighted-average number of shares of common stock outstanding. The Company computes diluted net income per share under a two-class method where income is reallocated between common stock, potential common stock and participating securities. Diluted net income (loss) per share attributable to common stockholders adjusts the basic net income (loss) per share attributable to common stockholders and the weighted-average number of shares of common stock outstanding for the potentially dilutive impact of stock options using the treasury stock method.

The following table sets forth the computation of the Company’s basic and diluted net loss per share attributable to common stockholders:


	For the year ended December 31,
(In thousands, except for share and per share values)	2023		2022		2021
Numerator:
Net loss	$	(39,238)	$	(49,019)	$	(38,679)
Add: gain on conversion of preferred stock(1)	—		—		28,994
Less: dividends paid to preferred stockholders(2)	—		—		(20,637)
Net loss attributable to common stockholders - basic and diluted	$	(39,238)	$	(49,019)	$	(30,322)



Denominator:
Weighted average shares of common stock outstanding - basic	94,516,690		92,201,806		71,126,218




Weighted average shares of common stock outstanding - diluted	94,516,690		92,201,806		71,126,218

Net loss per share, attributable to common shareholders:
Basic and diluted	$	(0.42)	$	(0.53)	$	(0.43)

_____________

The following potentially dilutive shares were excluded from the computation of diluted net income (loss) per share because including them would have been antidilutive:


	For the year ended December 31,
		2023	2022	2021
Stock options to purchase common stock		13,315,796	14,888,007	16,440,539
Unvested restricted stock units		8,256,453	4,618,354	2,970,867
Employee stock purchase plan		71,142	62,438	39,157
Total		21,643,391	19,568,799	19,450,563

Stock-Based Compensation - RSU Awards Narrative (Details) - Unvested restricted stock units - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized stock-based compensation expense	$ 16.6	$ 31.2
Period for recognition	3 years	2 years 6 months

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References

+ Details

Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2023

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

Basis of Presentation

Restructuring

Stock Split

Segment Reporting and Geographic Information

Use of Estimates

Cash and Cash Equivalents

Investments

Concentrations

The Company’s customers that accounted for 10% or more of total accounts receivable, net, were as follows:


	As of December 31,
	2023		2022
Customer A	49	%	44	%
Customer B	25	%	15	%

The Company’s customers that accounted for 10% or more of total revenue were as follows:


	For the Year Ended December 31,
	2023		2022		2021
Customer A	31	%	31	%	28	%
Customer B	30	%	19	%	22	%

The Company currently buys all of its diapers from one supplier. Additionally, the Company currently buys substantially all of its wipes from one supplier. Management believes that other suppliers could provide similar products on reasonable terms. A change in suppliers, however, could cause a delay in manufacturing and a possible inventory shortage and loss of revenue, which would adversely affect the Company's operations.

Accounts Receivable

Accounts receivable is presented as net of allowance for credit losses. The Company does not accrue interest on its trade receivables. The Company evaluates accounts receivable estimated to be uncollectible by considering the lifetime expected credit losses of our accounts receivable at time of inception, and records an allowance for credit losses, as necessary, with the balance of our accounts receivable presented at the net realizable value. The Company considers factors in its allowance for credit losses such as historical analysis, credit quality of customers, the age of the accounts receivable balances and macroeconomic conditions that may impact on the Company's customers' ability to pay. The allowance for credit losses was $0.4 million and $0.5 million, respectively, as of December 31, 2023 and 2022.

Inventories

Property and Equipment, Net


Machinery and equipment						3-20 years
Computer and office equipment						3-5 years
Capitalized software and website development costs						1-5 years
Furniture and fixtures						3-5 years
Building						40 years
Leasehold improvements						Lesser of the estimated useful life or the remaining lease term

Deferred IPO Costs

Deferred offering costs consisted of costs incurred in connection with the sale of the Company’s common stock in its IPO, including certain legal, accounting, and other IPO-related expenses. Immediately upon the completion of the Company's IPO, deferred offering costs of $5.5 million were reclassified into stockholders’ equity from other assets as a reduction from the proceeds of the offering.

Leases

Capitalized Software and Website Development Costs

For cloud-computing service arrangements, the Company capitalizes implementation costs consistent with internal-use software costs. Such capitalized costs are included within prepaid expenses and other current assets, for the current portion, and other assets, for the noncurrent portion, in the consolidated balance sheets and are expensed on a straight-line basis over the term of the service arrangement as selling, general and administrative expense. Capitalized implementation costs from cloud computing service arrangements were $1.1 million, net of $2.4 million of accumulated amortization as of December 31, 2023 and $1.0 million, net of $1.8 million of accumulated amortization as of December 31, 2022.

Goodwill

Intangible Assets, Net

Impairment of Long-Lived Assets

Income Taxes

A valuation allowance is recorded on deferred tax assets when it is determined that it is more likely than not that some portion or all of the net deferred tax assets will not be realized.

Foreign Currency Transactions

The Company records foreign currency gains or losses in other income, net in the consolidated statements of comprehensive loss, related to transactions denominated in currencies other than the U.S. dollar. During the years ended December 31, 2023, 2022 and 2021, realized and unrealized foreign currency losses, net were immaterial, $0.2 million and $0.1 million, respectively.

Contingent Liabilities

Stock-Based Compensation

• Risk-free interest rate - The risk-free interest rate is based on the U.S. Treasury yield of treasury bonds with a maturity that approximates the expected term of the options.

New shares are issued from authorized shares of common stock upon the exercise of stock options.

Fair Value Measurements

Level 1 - Quoted prices in active markets for identical assets or liabilities.

Revenue Recognition

The Company accounts for revenue contracts with customers by applying the following steps in accordance with ASC No. 606, Revenue from Contracts with Customers:

• Identification of the contract, or contracts, with a customer

• Identification of the performance obligations in the contract

• Determination of the transaction price

• Allocation of the transaction price to the performance obligations in the contract

• Recognition of revenue when, or as, the Company satisfies a performance obligation

Direct-to-Consumer

Retail and Third-Party Ecommerce

Sales Returns and Allowances

vary from actual results, which could be material to the consolidated financial statements. The estimated sales returns allowance is recorded as a reduction of revenue.

The following table summarizes the changes in the allowance for sales incentive programs for retail and third-party ecommerce customers:


	For the year ended December 31,
(In thousands)	2023		2022		2021
Beginning balance	$	6,396	$	6,494	$	8,207
Charged to revenue	49,724		48,962		47,290
Charged to selling, general and administrative expense	659		550		—
Charged to marketing expense	17,056		12,541		16,150
Utilization of accrual for trade promotions	(64,522)		(61,954)		(65,153)
Reclassification to prepaid expenses and other current assets/accrued expenses	(933)		(197)		—
Ending balance	$	8,380	$	6,396	$	6,494

As of December 31, 2023 and 2022, $6.8 million and $5.8 million, respectively, of the ending allowance balances were recorded as a reduction to accounts receivable.

Contract Assets

There are no material assets related to incremental costs to obtain or fulfill customer contracts.

Cost of Revenue

Selling, General and Administrative

Marketing

Advertising costs are expensed as incurred. Media production costs are expensed the first time the advertisement is aired. Deferred advertising costs consist mainly of point of purchase displays that are specifically branded for the Company’s products and provided to retailers in order to facilitate the marketing of the Company’s products within retail stores. The point of purchase display costs are capitalized as deferred advertising costs and charged to marketing expense over the expected period of benefit, which generally ranges from one to three years. As of December 31, 2023 and 2022, the current portion of deferred advertising costs was $0.4 million and $1.6 million, respectively, which is included in prepaid expenses and other current assets. As of December 31, 2023 and 2022, the noncurrent portion of deferred advertising costs was immaterial, respectively, which is included in other assets. Advertising expense was $33.8 million, $44.8 million and $49.2 million for the years ended December 31, 2023, 2022 and 2021, respectively.

Research and Development

Recent Accounting Pronouncements

Recently Adopted Accounting Pronouncements

Recently Issued Accounting Pronouncements – Not Yet Adopted

Related Party Transactions (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Related Party Transaction [Line Items]
Advertising expense	$ 33,800	$ 44,800	$ 49,200
Related Party \| Summit House Studios LLC
Related Party Transaction [Line Items]
Advertising expense	40	200	$ 600
Related Party \| Vault Co.
Related Party Transaction [Line Items]
Advertising expense	$ 30	$ 100

Stock-Based Compensation - Stock Option Activity Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands		12 Months Ended
	May 07, 2021	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted average exercise price (in USD per share)		$ 5.25	$ 5.24	$ 5.26
Total stock-based compensation expense		$ 15,804	$ 15,078	$ 16,847
Intrinsic value of options exercised		0	100	6,000
Fair value of options vested during the period		700	2,000	$ 7,900
Unrecognized stock-based compensation expense		$ 100	$ 1,000
Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Period for recognition		6 months	1 year 3 months 18 days
Options \| 2011 Stock Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of shares vested upon occurrence of event		25.00%
Share-based compensation anniversary period		10 years
Award vesting period		36 months
Stock Options With Liquidity Event Vesting Conditions
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock options vested (in shares)	2,442,918
Weighted average exercise price (in USD per share)	$ 5.54
Total stock-based compensation expense	$ 3,100
Share-Based Payment Arrangement, Option \| Certain Former Executives
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation anniversary period		3 years
Fair value of awards on day of modification		$ 500

Commitments and Contingencies

12 Months Ended

Dec. 31, 2023

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Litigation

From time to time, the Company is subject to various claims and contingencies which are in the scope of ordinary and routine litigation incidental to its business, including those related to regulation, business transactions, employee-related matters and taxes, among others. When the Company becomes aware of a claim or potential claim, the likelihood of any loss or exposure is assessed. If it is probable that a loss will result and the amount or range of the loss can be reasonably estimated, the Company records a liability for the loss and discloses the possible loss in the consolidated financial statements. Legal costs are expensed as incurred.

On September 17, 2019, the Nevada Department of Taxation (the “Department”) issued a Deficiency Notice against the Company to initiate administrative legal proceedings before the Department for the alleged non-compliance with employee retention requirements provided in exchange for tax benefits in establishing the Company’s Las Vegas distribution center in a December 2016 Abatement Agreement the Company had executed with the State of Nevada via its Governor’s Office of Economic Development. The Company has denied the allegations. An administrative hearing was held in the matter on January 15, 2021. On June 9, 2021 the court upheld the Department's Deficiency Notice against the Company in its entirety. The loss resulting from this matter was $0.7 million including penalties and interest, for which the Company has paid $0.6 million as of December 31, 2021. During the year ended December 31, 2021, the Company recorded interest expense of $0.1 million in interest and other expense, net on the consolidated statements of comprehensive loss. The Company filed its Notice of Appeal on July 1, 2021 and its opening brief on January 28, 2022. The Department filed its answering brief on March 4, 2022 and the Company filed its reply brief on March 23, 2022. The Nevada Tax Commission heard the appeal on May 2, 2022. The Nevada Tax Commission upheld the Company's appeal and overturned the Department's Deficiency Notice. The Company submitted a refund request for the taxes and interest paid, following the Department's June 9, 2021 decision, that were subject to abatement under the December 2016 Abatement Agreement. The Company recognized $0.7 million in other income in interest and other expense, net on the consolidated statements of comprehensive loss during the year ended December 31, 2022 related to the refund of taxes and interest paid.

On September 23, 2020, the Center for Advanced Public Awareness (“CAPA”) served a 60-Day Notice of Violation on the Company, alleging that the Company violated California’s Health and Safety Code (“Prop 65”) because of the amount of lead in the Company’s Diaper Rash Cream and seeking statutory penalties and product warnings available under Prop 65. On October 22, 2021, CAPA filed a complaint in California Superior Court in the County of San Francisco ("the Court") for the alleged Prop 65 violations contained in its 60-Day Notice of Violation. The Company filed its answer and notice of related cases against Prestige Consumer Healthcare, Inc., Burt's Bees, Inc., and Hain Celestial Group, Inc. on January 7, 2022 and has stipulated to relate these cases and transfer them to the Court's Complex Division. The Company intends to vigorously defend itself in this matter. The matter’s outcome and materiality are uncertain at this time. Therefore, the Company cannot estimate the probability of loss or make an estimate of the loss or range of loss in this matter.

On September 15, 2021, Cody Dixon filed a putative class action complaint in the U.S. District Court for the Central District of California alleging federal securities law violations by the Company, certain current officers and directors, and certain underwriters in connection with the Company’s IPO. A second putative class action complaint containing similar allegations against the Company and certain current officers and directors was filed by Stephen Gambino on October 8, 2021 in the U.S. District Court for the Central District of California. These related complaints have been transferred to the same court and a Lead Plaintiff has been appointed in the matter, and a putative consolidated class action complaint was filed by the Lead Plaintiff on February 21, 2022, alleging claims and seeking relief under Sections 11 and 15 of the Securities Act of 1933 relating to the Company’s IPO. Defendants’ motion to dismiss the putative consolidated class action complaint was filed on March 14, 2022. On July 18, 2022, the Company's motion to dismiss was granted in part and denied in part. On May 1, 2023, the Lead Plaintiff’s motion for class certification in the consolidated class action was granted in part and denied in part, with the U.S. District Court for the Central District of California limiting the certified class to only those persons and entities that purchased or otherwise acquired the Company’s publicly traded common stock pursuant and traceable to the Company’s IPO offering documents prior to August 19, 2021, as well as all persons and entities that acquired ownership of a trading account, retirement account, or any other similar investment account or portfolio containing the Company’s publicly traded common stock that was purchased or otherwise acquired pursuant and traceable to the IPO offering documents prior to August 19, 2021, and were damaged thereby. On August 14, 2023 the Lead Plaintiff filed an amended consolidated class action complaint naming as additional defendants Catterton Management Company L.L.C., L Catterton VIII, L.P., L. Catterton VIII Offshore, L.P., THC Shared Abacus, LP, Catterton Managing Partner VIII, L.L.C., and C8 Management, L.L.C. On October 16, 2023 those additional defendants filed a motion to

dismiss the Second Amended Complaint with respect to the claims against them. On January 31, 2024, that motion to dismiss was granted by the court to the extent those additional defendants challenged the claims as untimely. The court granted Lead Plaintiff leave to amend within fourteen days of that order. A derivative complaint was filed by Hayato Ono on behalf of the Company on November 29, 2021 in the U.S. District Court for the Central District of California, alleging breach of fiduciary duties, unjust enrichment, waste, gross mismanagement, and federal securities law violations by the Company’s directors and certain officers. On December 17, 2021, a second derivative complaint containing similar allegations against the Company’s directors and certain officers was filed by Mike Wang in the U.S. District Court for the Central District of California. These two federal derivative cases have been transferred to the same judge who is presiding over the securities class action complaints. A third derivative complaint was filed by Leah Bisch and Raluca Corobana in California Superior Court for the County of Los Angeles on January 3, 2022 with similar allegations. A fourth derivative complaint was filed by David Butler in the U.S. District Court for the District of Delaware on October 19, 2022 with similar allegations. Each of these federal and state court derivative cases have been stayed pending the outcome of a motion for summary judgment in the securities class action. These matters are in the preliminary stages of litigation with uncertain outcomes at this time. Therefore, the Company cannot estimate the probability of loss or make an estimate of the loss or range of loss in these matters.

On August 10, 2022, Catrice Sida and Kris Yerby filed a putative class action complaint in the U.S. District Court for the Northern District of California alleging violations of California’s Unfair Competition Law, False Advertising Law, Consumers Legal Remedies Act, breach of warranty, and unjust enrichment related to plant-based claims on certain of the Company’s wipes products and seeking declaratory relief, injunctive relief, monetary damages, punitive damages and statutory penalties, and attorneys’ fees and costs. The Company filed its motion to dismiss on October 17, 2022. On December 6, 2022, the Company's motion to dismiss was denied. The Company’s motion to stay pending the Ninth Circuit Court of Appeals’ review of the Central District of California’s decision in Whiteside v. Kimberly-Clark Corp., No. 5:22-cv-1988 JGB (SPx), 2023 WL 4328175 (C.D. Cal. June 1, 2023) was denied on September 5, 2023. On February 20, 2024, the parties filed a Notice of Settlement to notify the court that the parties have agreed to settle the matter on an individual, non-class basis. The plaintiffs will file a Stipulation of Dismissal upon finalization of the settlement agreement.

As of December 31, 2023 and 2022, the Company was not subject to any other currently pending legal matters or claims that based on its current evaluation are expected to have a material adverse effect on its financial position, results of operations, or cash flows should such matters be resolved unfavorably.

Indemnifications

In the ordinary course of business, the Company may provide indemnifications of varying scope and terms to investors, directors and officers with respect to certain matters, including, but not limited to, losses arising out of the Company’s breach of such agreements, services to be provided by the Company, or from intellectual property infringement claims made by third parties. These indemnifications may survive termination of the underlying agreement and the maximum potential number of future payments the Company could be required to make under these indemnification provisions may not be subject to maximum loss clauses. The maximum potential number of future payments the Company could be required to make under these indemnification provisions is indeterminable. The Company has never been involved in litigation in connection with these indemnification arrangements. As of December 31, 2023 and 2022, the Company has not accrued a liability for these guarantees as the likelihood of incurring a payment obligation, if any, in connection with these guarantees is not probable or reasonably estimable due to the unique facts and circumstances involved.

Purchase Commitments

The Company has unconditional purchase commitments for software service subscriptions, advertising services and certain other services. Future minimum payments under these unconditional purchase commitments are as follows:


(In thousands)
Years Ending December 31,
2024	$	3,369
2025	1,145
2026	474
2027	174
2028	—
Thereafter	—
Future minimum payments	$	5,162

Leases

12 Months Ended

Dec. 31, 2023

Leases [Abstract]

Leases

The Company’s lease portfolio includes both real estate and non-real estate type leases which are accounted for as either finance or operating leases. Real estate leases generally include office and warehouse facilities and non-real estate leases generally include office equipment and machinery. The Company determines if a contract is or contains a lease at inception. The Company’s leases have remaining lease terms of less than one to six years.

In connection with two of the Company’s facilities leases, the Company is required to obtain irrevocable letters of credit in lieu of security deposits. The letters of credit totaled $3.7 million and $4.8 million as of December 31, 2023 and 2022, respectively, and expire within a set number of days after the expirations of the facilities leases. In connection with the Company’s office facility lease, following the fourth year of the lease, the letter of credit balance can be reduced annually by a stated amount in the lease agreement, so long as the Company complies with certain covenants. In connection with the Company’s warehouse lease, the letter of credit balance is reduced annually by a stated amount in the lease agreement, so long as the Company complies with certain covenants.

The components of lease expense were as follows (in thousands):


	For the year ended December 31,
	2023		2022
Finance lease expense:
Amortization	$	50	$	263
Interest on lease liabilities	—		7
Operating lease expense:

Operating lease expense(1)	7,168		7,153
Sublease income	(2,006)		(2,006)
Total lease expense, net	$	5,212	$	5,417

______________________

(1) Represents the straight-line lease expense of operating leases, inclusive of amortization of ROU assets and the interest component of operating lease liabilities.

For the year ended December 31, 2021, rent expense under ASC 840 was $5.0 million. For the year ended December 31, 2021, sublease rent income was $2.5 million.

Based on the nature of the ROU assets, amortization of finance leases and amortization of operating ROU assets, operating lease expense and other lease expense are recorded within either cost of revenue or selling, general and administrative expenses and interest on finance lease liabilities is recorded within interest and other expense, net in the consolidated statements of comprehensive loss.

The following tables set forth the amount of lease assets and lease liabilities included in the Company’s consolidated balance sheets (in thousands):


		As of December 31,
Assets	Financial Statement Line Item	2023		2022
Finance lease assets	Property and equipment, net	$	17	$	70
Operating lease assets	Operating lease right-of-use asset	23,683		29,947
Total lease assets		$	23,700	$	30,017
Liabilities
Current
Finance lease liabilities	Accrued expenses	23		52
Operating lease liabilities	Accrued expenses	8,105		7,688
Non-current
Finance lease liabilities	Other long-term liabilities	—		22
Operating lease liabilities	Operating lease liabilities, net of current portion	21,738		29,842
Total lease liabilities		$	29,866	$	37,604

Supplemental information related to the Company’s leases for the year ended December 31, 2023 was as follows:


	For the year ended December 31,
	2023	2022
Weighted-average remaining lease term (in years)
Finance leases	0.6	1.4
Operating leases	4.1	4.5
Weighted-average discount rate
Finance leases	2.77%	3.00%
Operating leases	2.29%	2.29%
Cash paid for amounts included in the measurement of lease liabilities (in thousands)
Operating cash flows used in finance leases	$1	$8
Operating cash flows used in operating leases	$7,688	$7,007
Finance cash flows used in finance leases	$58	$303

The Company did not have any non-cash ROU assets obtained in exchange for lease liabilities during the year ended December 31, 2023 for either finance or operating leases.

Future minimum lease payments required under operating and finance leases as of December 31, 2023, were as follows (in thousands):


	Operating Leases		Finance Leases
2024	$	8,704	22
2025	8,950		1
2026	9,201		—
2027	4,246		—
2028	—		—
Thereafter	—		—
Future minimum lease payments	$	31,101	$	23
Less: Amount representing interest	(1,258)		—
Present value of future lease payments	$	29,843	$	23

Leases

The components of lease expense were as follows (in thousands):


	For the year ended December 31,
	2023		2022
Finance lease expense:
Amortization	$	50	$	263
Interest on lease liabilities	—		7
Operating lease expense:

Operating lease expense(1)	7,168		7,153
Sublease income	(2,006)		(2,006)
Total lease expense, net	$	5,212	$	5,417

______________________

(1) Represents the straight-line lease expense of operating leases, inclusive of amortization of ROU assets and the interest component of operating lease liabilities.

For the year ended December 31, 2021, rent expense under ASC 840 was $5.0 million. For the year ended December 31, 2021, sublease rent income was $2.5 million.

The following tables set forth the amount of lease assets and lease liabilities included in the Company’s consolidated balance sheets (in thousands):


		As of December 31,
Assets	Financial Statement Line Item	2023		2022
Finance lease assets	Property and equipment, net	$	17	$	70
Operating lease assets	Operating lease right-of-use asset	23,683		29,947
Total lease assets		$	23,700	$	30,017
Liabilities
Current
Finance lease liabilities	Accrued expenses	23		52
Operating lease liabilities	Accrued expenses	8,105		7,688
Non-current
Finance lease liabilities	Other long-term liabilities	—		22
Operating lease liabilities	Operating lease liabilities, net of current portion	21,738		29,842
Total lease liabilities		$	29,866	$	37,604

Supplemental information related to the Company’s leases for the year ended December 31, 2023 was as follows:


	For the year ended December 31,
	2023	2022
Weighted-average remaining lease term (in years)
Finance leases	0.6	1.4
Operating leases	4.1	4.5
Weighted-average discount rate
Finance leases	2.77%	3.00%
Operating leases	2.29%	2.29%
Cash paid for amounts included in the measurement of lease liabilities (in thousands)
Operating cash flows used in finance leases	$1	$8
Operating cash flows used in operating leases	$7,688	$7,007
Finance cash flows used in finance leases	$58	$303

The Company did not have any non-cash ROU assets obtained in exchange for lease liabilities during the year ended December 31, 2023 for either finance or operating leases.

Future minimum lease payments required under operating and finance leases as of December 31, 2023, were as follows (in thousands):


	Operating Leases		Finance Leases
2024	$	8,704	22
2025	8,950		1
2026	9,201		—
2027	4,246		—
2028	—		—
Thereafter	—		—
Future minimum lease payments	$	31,101	$	23
Less: Amount representing interest	(1,258)		—
Present value of future lease payments	$	29,843	$	23

Revenue - Disaggregation of Revenue (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Disaggregation of Revenue [Line Items]
Total revenue	$ 344,365	$ 313,651	$ 318,639
Diapers and Wipes
Disaggregation of Revenue [Line Items]
Total revenue	218,263	200,429	200,923
Skin and Personal Care
Disaggregation of Revenue [Line Items]
Total revenue	88,104	89,316	101,697
Household and Wellness
Disaggregation of Revenue [Line Items]
Total revenue	37,998	23,906	16,019
Digital
Disaggregation of Revenue [Line Items]
Total revenue	169,015	141,403	157,546
Retail
Disaggregation of Revenue [Line Items]
Total revenue	$ 175,350	$ 172,248	$ 161,093

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References + Details

- Definition

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 924
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SAB Topic 11.L)
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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-URI https://asc.fasb.org//1943274/2147479806/606-10-50-5

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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-URI https://asc.fasb.org//1943274/2147482810/280-10-50-30

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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Reference 5: http://www.xbrl.org/2003/role/disclosureRef
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
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Reference 10: http://www.xbrl.org/2003/role/disclosureRef
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-Paragraph 41
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Reference 11: http://www.xbrl.org/2003/role/disclosureRef
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-Section 50
-Paragraph 4
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-4

+ Details

Commitments and Contingencies - Additional Information (Details) - Nevada Department of Taxation vs. Honest Company - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Loss Contingencies [Line Items]
Payments for legal settlements		$ 0.6
Interest expense		0.1
Other income	$ 0.7
Pending Litigation
Loss Contingencies [Line Items]
Potential loss		$ 0.7

Credit Facilities	12 Months Ended
Credit Facilities	Dec. 31, 2023
Debt Disclosure [Abstract]
Credit Facilities	Credit Facilities 2021 Credit Facility In April 2021, the Company entered into a first lien credit agreement (“2021 Credit Facility”), with JPMorgan Chase Bank, N.A., as administrative agent and lender, and the other lenders party thereto, which provided for a $35.0 million revolving credit facility that matures on April 30, 2026. The 2021 Credit Facility included a subfacility that provided for the issuance of letters of credit in an amount of up to $10.0 million at any time outstanding, which reduced the amount available under the 2021 Credit Facility. As of December 31, 2022, there were outstanding standby letters of credit of $4.8 million related to lease obligations with $30.2 million available to be drawn upon. The 2021 Credit Facility was subject to customary fees for loan facilities of this type, including a commitment fee based on the average daily undrawn portion of the revolving credit facility. The Company recognized the commitment fee as incurred in interest and other expense, net in the consolidated statements of comprehensive loss. For the year ended December 31, 2022, the commitment fee incurred was immaterial. As of December 31, 2022, there was no outstanding balance under the 2021 Credit Facility. In January 2023, the 2021 Credit Facility was terminated and replaced in its entirety with the 2023 Credit Facility (defined below). 2023 Credit Facility In January 2023, the Company entered into a first lien credit agreement (the “2023 Credit Facility”), with JPMorgan Chase Bank, N.A., as administrative agent and lender, and the other lenders party thereto, which provides for a $35.0 million revolving credit facility that matures on April 30, 2026. The 2023 Credit Facility includes a sub-facility that provides for the issuance of letters of credit in an amount of up to $15.0 million at any time outstanding. Availability of the 2023 Credit Facility is based upon a borrowing base formula and periodic borrowing base certifications valuing certain of the Company’s accounts receivable and inventory as reduced by an availability block and certain reserves, if any. The 2023 Credit Facility includes an uncommitted accordion feature that allows for increases in the revolving commitment to as much as an additional $35.0 million, for up to $70.0 million in potential revolving commitment. The 2023 Credit Facility is subject to customary fees for loan facilities of this type, including a commitment fee based on the average daily undrawn portion of the 2023 Credit Facility. The Company recognizes the commitment fee as incurred in interest and other income (expense), net in the consolidated statements of comprehensive loss. For the year ended December 31, 2023, the commitment fee incurred was immaterial. As of December 31, 2023, there were $3.7 million outstanding letters of credit and $17.7 million available to be drawn upon. As of December 31, 2023, there was no outstanding balance under the 2023 Credit Facility. The interest rate applicable to the 2023 Credit Facility is, at the Company’s option, either (a) the Adjusted Term SOFR rate (subject to a 0.00% floor), plus a margin ranging from 1.50% to 2.25% or (b) the CB floating rate, (i) plus a margin of 0.25% or (ii) minus a margin ranging from 0.25% to 0.50%. The margin is based upon the Company’s fixed charge coverage ratio. The CB floating rate is the higher of (a) the Wall Street Journal prime rate and (b) 2.50%. The 2023 Credit Facility will terminate and borrowings thereunder, if any, would be due in full on April 30, 2026. Debt under the 2023 Credit Facility is guaranteed by substantially all of the Company’s material domestic subsidiaries and is secured by substantially all of the Company’s and such subsidiaries’ assets. The 2023 Credit Facility contains covenants that restrict, among other things, the Company's ability to sell assets, make investments and acquisitions, grant liens, change the Company’s lines of business, pay dividends and make certain other restricted payments. The Company is subject to certain affirmative and negative covenants including the requirement that it maintains a minimum total fixed charge coverage ratio during the periods set forth in the 2023 Credit Facility. Failure to do so, unless waived by the lenders under the 2023 Credit Facility pursuant to its terms, as amended, would result in an event of default under the 2023 Credit Facility. As of December 31, 2023, the Company is in compliance with all covenants under the 2023 Credit Facility.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1B
-Subparagraph (h)
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
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-Paragraph 1
-Subparagraph (SX 210.4-08(c))
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-URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1

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-URI https://asc.fasb.org//470/tableOfContent

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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Reference 5: http://www.xbrl.org/2003/role/disclosureRef
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-Paragraph 1B
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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Reference 8: http://www.xbrl.org/2003/role/disclosureRef
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
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-Subparagraph (c)
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-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1C

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
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Reference 11: http://www.xbrl.org/2003/role/disclosureRef
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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1I

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
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-Paragraph 1I
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-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1I

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
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-Name Accounting Standards Codification
-Section 50
-Paragraph 1I
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1I

+ Details

Income Taxes - Summary of Reconciliation of Income Tax Benefit (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Income Tax Disclosure [Abstract]
Income tax benefit at the federal statutory rate	$ (8,203)	$ (10,271)	$ (8,106)
State income taxes, net of federal benefit	(90)	(625)	(143)
Permanent differences for equity compensation	2,587	2,604	5,156
Nondeductible items	142	53	84
Nondeductible compensation	1,218	302	1,349
Change in valuation allowance	4,654	8,047	1,737
Other adjustments	(233)	0	0
Income tax provision	$ 75	$ 110	$ 77

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

+ References + Details

Credit Facilities (Details) - USD ($)	1 Months Ended
Credit Facilities (Details) - USD ($)	Jan. 31, 2023	Dec. 31, 2023	Dec. 31, 2022	Apr. 30, 2021
2021 Credit Facility \| Revolving Credit Facility \| JP Morgan Chase Bank
Line of Credit Facility [Line Items]
Maximum issuance of letters of credit				$ 35,000,000
Outstanding borrowings			$ 0
2021 Credit Facility \| Letter of Credit
Line of Credit Facility [Line Items]
Maximum issuance of letters of credit				$ 10,000,000
2021 Credit Facility \| Standby Letters of Credit
Line of Credit Facility [Line Items]
Letters of credit issued		$ 3,700,000	4,800,000
2021 Credit Facility \| Standby Letters of Credit \| JP Morgan Chase Bank
Line of Credit Facility [Line Items]
Borrowing capacity available			$ 30,200,000
2023 Credit Facility \| Revolving Credit Facility \| Line of Credit
Line of Credit Facility [Line Items]
Maximum issuance of letters of credit	$ 35,000,000
Letters of credit issued		3,700,000
Borrowing capacity available		17,700,000
Uncommitted accordion feature	35,000,000
Potential revolving commitment	$ 70,000,000
SOFR floor rate	0.00%
2023 Credit Facility \| Revolving Credit Facility \| Secured Overnight Financing Rate (SOFR) \| Line of Credit \| Minimum
Line of Credit Facility [Line Items]
Debt instrument, basis spread on variable rate (as a percent)	1.50%
2023 Credit Facility \| Revolving Credit Facility \| Secured Overnight Financing Rate (SOFR) \| Line of Credit \| Maximum
Line of Credit Facility [Line Items]
Debt instrument, basis spread on variable rate (as a percent)	2.25%
2023 Credit Facility \| Revolving Credit Facility \| Prime Rate \| Line of Credit
Line of Credit Facility [Line Items]
Debt instrument, basis spread on variable rate (as a percent)	0.25%
2023 Credit Facility \| Revolving Credit Facility \| Prime Rate \| Line of Credit \| Minimum
Line of Credit Facility [Line Items]
Debt instrument, basis spread on variable rate (as a percent)	(0.25%)
2023 Credit Facility \| Revolving Credit Facility \| Prime Rate \| Line of Credit \| Maximum
Line of Credit Facility [Line Items]
Debt instrument, basis spread on variable rate (as a percent)	(0.50%)
2023 Credit Facility \| Revolving Credit Facility \| CB floating rate
Line of Credit Facility [Line Items]
Interest rate base (as a percent)	2.50%
2023 Credit Facility \| Letter of Credit \| Line of Credit
Line of Credit Facility [Line Items]
Maximum issuance of letters of credit	$ 15,000,000	$ 0

Stock-Based Compensation - 2021 Employee Stock Purchase Plan (Details) - USD ($) $ / shares in Units, $ in Millions	1 Months Ended	12 Months Ended
	Apr. 30, 2021	Dec. 31, 2023	Dec. 31, 2022	Jan. 01, 2023	Dec. 31, 2020
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of common stock authorized to be issued (in shares)					6,176,766
Employee stock purchase plan \| 2021 Employee Stock Purchase Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of common stock authorized to be issued (in shares)	1,175,000			928,256
Period to increase available shares for issuance	10 years
Percentage of total number of shares outstanding	1.00%
Additional shares authorized (in shares)	3,525,000
Purchase price of common stock in percent	85.00%
Shares issued through ESPP (in shares)		126,969	95,742
Proceeds from issuance of common stock		$ 0.2	$ 0.3
Share price (in USD per share)		$ 1.39	$ 2.68
Number of shares available for purchase (in shares)		2,756,394	1,955,107

Income Taxes - Additional Information (Details) - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Operating Loss Carryforwards [Line Items]
Deferred tax assets related to capitalized research and development expenses	$ 4,346,000	$ 1,456,000
Uncertain tax positions	0	0
Interest and penalties expense	0	0
Federal
Operating Loss Carryforwards [Line Items]
Net operating loss carryforward	311,000,000	301,000,000
State
Operating Loss Carryforwards [Line Items]
Net operating loss carryforward	274,000,000	272,000,000
Tax credits	$ 0	$ 0

Stock-Based Compensation (Tables)

12 Months Ended

Dec. 31, 2023

Share-Based Payment Arrangement [Abstract]

Schedule of Stock Option Activity

The following table summarizes the stock option activity:


	Number of Options	Weighted Average Exercise Price		Weighted Average Contractual Term (Years)	Intrinsic Value (in thousands)





Outstanding at December 31, 2021	16,440,539	$	5.26	5.4	$	46,589
Granted	—	$	—
Exercised	(43,556)	$	2.81
Forfeited/Cancelled	(1,508,976)	$	5.50
Outstanding at December 31, 2022	14,888,007	$	5.24	4.0	$	3,024
Granted	—	$	—
Exercised	(2,300)	$	1.70
Forfeited/Cancelled	(1,569,911)	$	5.17
Outstanding at December 31, 2023	13,315,796	$	5.25	3.0	$	—

Exercisable at December 31, 2022	14,503,073	$	5.23	3.9	$	3,024
Exercisable at December 31, 2023	13,266,609	$	5.25	3.0	$	—

Schedule of Restricted Stock Unit Activity

The following table summarizes the RSU activity:


	Number of Shares		Weighted Average Grant Date Fair Value Per Share
	Non-Employee Directors	Directors, Officers and Employees	Non-Employee Directors		Directors, Officers and Employees




Unvested RSUs at December 31, 2021	103,561	2,867,306	$	16.00	$	13.58
Granted	485,806	3,113,741	$	3.51	$	5.07
Vested(1)	(131,775)	(1,121,573)	$	13.38	$	12.20
Forfeited	(4,641)	(694,071)	$	8.09	$	10.54
Unvested RSUs at December 31, 2022	452,951	4,165,403	$	3.44	$	8.09
Transfer from Employee to Non-Employee Director(2)	1,147,566	(1,147,566)	$	9.02	$	9.02
Granted	1,376,563	7,505,557	$	2.01	$	1.71
Vested(1)	(1,382,224)	(1,449,577)	$	5.84	$	6.31
Forfeited	(637,657)	(1,774,563)	$	7.07	$	5.44
Unvested RSUs at December 31, 2023	957,199	7,299,254	$	2.19	$	2.38

_______________

(1) The Company extended the post-termination stock option exercise period for certain former executives, resulting in stock-based compensation expense of $0.5 million during the year ended December 31, 2023. Additionally, the Company modified certain former executives' RSUs to accelerate vesting, resulting in stock-based compensation expense of $3.1 million during the year ended December 31, 2023.

(2) Relates to former Chief Executive Officer ("CEO") RSUs that were reclassified to non-employee director shares for disclosure purposes. The former CEO was not re-nominated for election by the Board in connection with the annual stockholder meeting in May 2023.

Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions

The following table summarizes the key input assumptions used in the Black-Scholes option-pricing model to estimate the grant-date fair value of the 2021 ESPP:


	For the Year Ended December 31,
	2023			2022
Expected life of options (in years)	0.50			0.50
Expected stock price volatility	69.20%	—	86.19%	73.27		%	—	79.56		%
Risk free interest rate	5.36%	—	5.43%	1.52		%	—	4.65		%
Expected dividend yield	—%			—%
Weighted average grant-date fair value per share	$0.56	—	$0.67	$	1.09		—	$	1.12

Stock-based Compensation Expense

Stock-based compensation expense related to RSU awards, 2021 ESPP purchases and stock options, as applicable, are as follows:


	For the year ended December 31,
		2023		2022		2021
(In thousands)
Selling, general and administrative(1)		$	15,465	$	14,593	$	15,820
Research and development		339		485		1,027
Total stock-based compensation expense		$	15,804	$	15,078	$	16,847

__________________

Investments - Available-for-Sale Investments (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Debt Securities, Available-for-sale [Line Items]
Cost or Amortized Cost		$ 5,682
Gross Unrealized Gains		0
Gross Unrealized Losses	$ 0	(33)
Total Estimated Fair Value	$ 0	5,650
Corporate bonds
Debt Securities, Available-for-sale [Line Items]
Cost or Amortized Cost		3,216
Gross Unrealized Gains		0
Gross Unrealized Losses		(24)
Total Estimated Fair Value		3,193
Commercial paper
Debt Securities, Available-for-sale [Line Items]
Cost or Amortized Cost		582
Gross Unrealized Gains		0
Gross Unrealized Losses		0
Total Estimated Fair Value		582
Certificates of deposit
Debt Securities, Available-for-sale [Line Items]
Cost or Amortized Cost		1,884
Gross Unrealized Gains		0
Gross Unrealized Losses		(9)
Total Estimated Fair Value		$ 1,875

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 320
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-Name Accounting Standards Codification
-Section 50
-Paragraph 2
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-URI https://asc.fasb.org//1943274/2147481800/320-10-50-2

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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Reference 5: http://www.xbrl.org/2003/role/disclosureRef
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-Paragraph 2
-Subparagraph (b)
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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-URI https://asc.fasb.org//1943274/2147481800/320-10-50-2

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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Reference 8: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
-Section 50
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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-3

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
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-SubTopic 10
-Name Accounting Standards Codification
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Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 320
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-Paragraph 3
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-URI https://asc.fasb.org//1943274/2147481800/320-10-50-3

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
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Reference 12: http://www.xbrl.org/2003/role/disclosureRef
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-Section 50
-Paragraph 3
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-3

+ Details

Related Party Transactions	12 Months Ended
Related Party Transactions	Dec. 31, 2023
Related Party Transactions [Abstract]
Related Party Transactions	Related Party Transactions In April 2020, the Company engaged Summit House Studios LLC, a third-party consultant, to provide digital ad production services. Summit House Studios LLC is owned by a major shareholder of the Company. Based on services provided, the Company incurred $0.04 million, $0.2 million and $0.6 million of advertising costs for this related party during the years ended December 31, 2023, 2022 and 2021, respectively, which is reported as marketing expense in the Company’s consolidated statements of comprehensive loss. In May 2022, the Company engaged, Vault Co., a third-party consultant, to develop and deliver an ongoing brand tracker for the Company. Vault Co. is owned by a major shareholder of the Company. Based on services provided, the Company incurred $0.03 million and $0.1 million, respectively, of advertising costs for this related party during the year ended December 31, 2023 and 2022, which is reported as marketing expense in the Company’s consolidated statements of comprehensive loss.

- Definition

The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480990/946-20-50-2

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
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-Name Accounting Standards Codification
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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480990/946-20-50-5

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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-SubTopic 20
-Name Accounting Standards Codification
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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480990/946-20-50-6

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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-Paragraph 2
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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481062/946-235-50-2

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
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-Publisher FASB
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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-Section 50
-Paragraph 1
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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483326/850-10-50-1

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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-Paragraph 1
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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483575/946-220-S99-1

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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-Paragraph 1
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-URI https://asc.fasb.org//1943274/2147483575/946-220-S99-1

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
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-Name Accounting Standards Codification
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-Paragraph 1
-Subparagraph (SX 210.6-07(2)(e))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483575/946-220-S99-1

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 850
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org//850/tableOfContent

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 850
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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483326/850-10-50-6

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 850
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-Section 50
-Paragraph 1
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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483326/850-10-50-1

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 850
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-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483326/850-10-50-1

+ Details

Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Current assets
Cash and cash equivalents	$ 32,827	$ 9,517
Short-term investments	0	5,650
Accounts receivable, net	43,084	42,334
Inventories	73,490	115,664
Prepaid expenses and other current assets	8,371	15,982
Total current assets	157,772	189,147
Operating lease right-of-use asset	23,683	29,947
Property and equipment, net	13,486	14,327
Goodwill	2,230	2,230
Intangible assets, net	309	370
Other assets	4,141	4,578
Total assets	201,621	240,599
Current liabilities
Accounts payable	22,289	24,755
Accrued expenses	32,209	38,010
Deferred revenue	2,212	815
Total current liabilities	56,710	63,580
Long term liabilities
Operating lease liabilities, net of current portion	21,738	29,842
Other long-term liabilities	34	817
Total liabilities	78,482	94,239
Commitments and contingencies (Note 11)
Stockholders’ equity
Preferred stock, $0.0001 par value, 20,000,000 shares authorized at December 31, 2023 and 2022, none issued or outstanding as of December 31, 2023 and 2022	0	0
Common stock, $0.0001 par value, 1,000,000,000 shares authorized at December 31, 2023 and 2022; 95,868,421 and 92,907,351 shares issued and outstanding as of December 31, 2023 and 2022, respectively	9	9
Additional paid-in capital	602,198	586,213
Accumulated deficit	(479,068)	(439,830)
Accumulated other comprehensive loss	0	(32)
Total stockholders’ equity	123,139	146,360
Total liabilities and stockholders’ equity	$ 201,621	$ 240,599

Cover - USD ($)	12 Months Ended
Cover - USD ($)	Dec. 31, 2023	Mar. 04, 2024	Jun. 30, 2023
Cover [Abstract]
Document Type	10-K
Document Annual Report	true
Document Period End Date	Dec. 31, 2023
Current Fiscal Year End Date	--12-31
Document Transition Report	false
Entity File Number	001-40378
Entity Registrant Name	The Honest Company, Inc.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	90-0750205
Entity Address, Address Line One	12130 Millennium Drive
Entity Address, Address Line Two	#500
Entity Address, City or Town	Los Angeles
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	90094
City Area Code	888
Local Phone Number	862-8818
Title of 12(b) Security	Common Stock, $0.0001 par value per share
Trading Symbol	HNST
Security Exchange Name	NASDAQ
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
ICFR Auditor Attestation Flag	false
Document Financial Statement Error Correction [Flag]	false
Entity Shell Company	false
Entity Public Float			$ 111,687,173
Entity Common Stock, Shares Outstanding		95,892,996
Documents Incorporated by Reference	Portions of the Registrant’s definitive Proxy Statement relating to the 2024 Annual Meeting of Stockholders are incorporated herein by reference in Part III of this Annual Report on Form 10-K to the extent stated herein. Such Proxy Statement will be filed with the Securities and Exchange Commission within 120 days of the Registrant’s fiscal year ended December 31, 2023.
Entity Central Index Key	0001530979
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	FY
Amendment Flag	false

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2023

Income Tax Disclosure [Abstract]

Schedule of Components of Income Tax Provision

The components of income tax provision consisted of the following:


	For the year ended December 31,
		2023		2022		2021
(In thousands)
Current
Federal		$	—	$	—	$	—
State		75		110		77
Foreign		—		—		—
		75		110		77
Deferred
Federal		—		—		—
State		—		—		—
Foreign		—		—		—
		—		—		—
Income tax provision		$	75	$	110	$	77

Schedule of Effective Income Tax Rate Reconciliation

The reconciliation of the income tax benefit computed at the U.S. federal statutory rate of 21% to the Company’s income tax provision is as follows:


	For the year ended December 31,
	2023		2022		2021
(In thousands)
Income tax benefit at the federal statutory rate	$	(8,203)	$	(10,271)	$	(8,106)
State income taxes, net of federal benefit	(90)		(625)		(143)
Permanent differences for equity compensation	2,587		2,604		5,156
Nondeductible items	142		53		84
Nondeductible compensation	1,218		302		1,349
Change in valuation allowance	4,654		8,047		1,737
Other adjustments	(233)		—		—
Income tax provision	$	75	$	110	$	77

Schedule of Deferred Tax Assets and Liabilities

The tax effects of temporary differences that gave rise to significant portions of deferred tax assets and liabilities were as follows:


	As of December 31,
(In thousands)	2023		2022
Deferred tax assets
Intangible assets	$	75	$	95
Property and equipment	867		815
Accrued expenses	1,488		653
Deferred revenue	113		51
Allowances, reserves and other	2,013		2,796
Stock-based compensation	7,728		8,335
Section 174 capitalized expenses	4,346		1,456
Net operating loss and other carryforwards	87,327		85,176
Total deferred tax assets	103,957		99,377
Valuation allowance	(98,771)		(94,103)
Net deferred tax assets	5,186		5,274
Deferred tax liabilities


Prepaid expenses	(376)		(364)
State taxes	(4,810)		(4,910)
Total deferred tax liabilities	(5,186)		(5,274)
Net deferred taxes	$	—	$	—

Schedule of Changes in Valuation Allowance

The following table summarizes the changes in the valuation allowance:


	For the year ended December 31,
	2023		2022		2021
(In thousands)
Beginning balance	$	94,103	$	86,659	$	84,934
Increase to valuation allowance	4,654		8,047		1,737
Decrease due to adoption of ASC 842	—		(613)		—
Other increases (decreases)	14		10		(12)
Ending balance	$	98,771	$	94,103	$	86,659

Leases - Summary of Assets and Liabilities (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Assets
Finance lease, right-of-use asset, statement of financial position	Property and equipment, net	Property and equipment, net
Finance lease assets	$ 17	$ 70
Operating lease right-of-use asset	23,683	29,947
Total lease assets	$ 23,700	$ 30,017
Current
Finance lease, liability, current, statement of financial position	Accrued Liabilities, Current	Accrued Liabilities, Current
Finance lease liabilities	$ 23	$ 52
Operating lease, liability, current, statement of financial position	Accrued Liabilities, Current	Accrued Liabilities, Current
Operating lease liabilities	$ 8,105	$ 7,688
Non-current
Finance lease, liability, noncurrent, statement of financial position	Other long-term liabilities	Other long-term liabilities
Finance lease liabilities	$ 0	$ 22
Operating lease liabilities, net of current portion	21,738	29,842
Total lease liabilities	$ 29,866	$ 37,604
Weighted-average remaining lease term (in years)
Finance leases	7 months 6 days	1 year 4 months 24 days
Operating leases	4 years 1 month 6 days	4 years 6 months
Weighted-average discount rate
Finance leases	2.77%	3.00%
Operating leases	2.29%	2.29%
Cash paid for amounts included in the measurement of lease liabilities (in thousands)
Operating cash flows used in finance leases	$ 1	$ 8
Operating cash flows used in operating leases	7,688	7,007
Finance cash flows used in finance leases	$ 58	$ 303

Property and Equipment, Net

12 Months Ended

Dec. 31, 2023

Property, Plant and Equipment [Abstract]

Property and Equipment, Net

Property and equipment consisted of the following:


	As of December 31,
	2023		2022
(in thousands)
Machinery and equipment	$	13,850	$	12,198
Computer and office equipment	1,700		1,794
Capitalized software	5,094		5,989
Furniture and fixtures	4,335		4,334
Leasehold improvements	15,829		15,839
Subtotal	40,808		40,154
Accumulated depreciation and amortization	(27,322)		(25,827)
Total property and equipment, net	$	13,486	$	14,327

For each of the years ended December 31, 2023, 2022 and 2021, depreciation of equipment under capital lease obligations was $0.0 million, $0.3 million and $0.4 million, respectively.

Total depreciation and amortization expense for property and equipment, inclusive of depreciation expense for equipment under capital lease obligations consisted of the following:


	For the year ended December 31,
	2023		2022		2021
(In thousands)
Cost of revenues	$	931	$	1,013	$	2,198
Research and development	223		195		186
Selling, general and administrative	1,515		1,474		1,697
Total depreciation and amortization expense	$	2,669	$	2,682	$	4,081

Property and Equipment, Net - Schedule of Depreciation Expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Property, Plant and Equipment [Line Items]
Depreciation and amortization	$ 2,740	$ 2,753	$ 4,146
Property, Plant and Equipment
Property, Plant and Equipment [Line Items]
Depreciation and amortization	2,669	2,682	4,081
Cost of revenues \| Property, Plant and Equipment
Property, Plant and Equipment [Line Items]
Depreciation and amortization	931	1,013	2,198
Research and development \| Property, Plant and Equipment
Property, Plant and Equipment [Line Items]
Depreciation and amortization	223	195	186
Selling, general and administrative \| Property, Plant and Equipment
Property, Plant and Equipment [Line Items]
Depreciation and amortization	$ 1,515	$ 1,474	$ 1,697

Revenue (Tables)

12 Months Ended

Dec. 31, 2023

Revenue from Contract with Customer [Abstract]

Disaggregation of Revenue


Revenue by sales channel:	For the year ended December 31,
		2023		2022		2021
(In thousands)
Digital		$	169,015	$	141,403	$	157,546
Retail		175,350		172,248		161,093
Total revenue		$	344,365	$	313,651	$	318,639


Revenue by product category:	For the year ended December 31,
		2023		2022		2021
(In thousands)
Diapers and Wipes		$	218,263	$	200,429	$	200,923
Skin and Personal Care		88,104		89,316		101,697
Household and Wellness		37,998		23,906		16,019
Total revenue		$	344,365	$	313,651	$	318,639

Leases - Additional Information (Details) - USD ($)	12 Months Ended
Leases - Additional Information (Details) - USD ($)	Dec. 31, 2023	Dec. 31, 2021	Dec. 31, 2022
Lessee, Lease, Description [Line Items]
Rent expense		$ 5,000,000
Sublease rent income		$ 2,500,000
Non-cash ROU assets obtained in exchange for finance lease liabilities	$ 0
Non-cash ROU assets obtained in exchange for operating lease liabilities	0
Standby Letters of Credit \| 2021 Credit Facility
Lessee, Lease, Description [Line Items]
Letters of credit issued	$ 3,700,000		$ 4,800,000
Minimum
Lessee, Lease, Description [Line Items]
Lessee, operating lease, remaining lease term	1 year
Lessee, finance lease, remaining lease term	1 year
Maximum
Lessee, Lease, Description [Line Items]
Lessee, operating lease, remaining lease term	6 years
Lessee, finance lease, remaining lease term	6 years

Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders’ Equity (Deficit) (Parenthetical) $ in Millions	12 Months Ended
	Dec. 31, 2021 USD ($) $ / shares
Statement of Stockholders' Equity [Abstract]
Dividends paid (in USD per share) \| $ / shares	$ 0.42
Underwriting commissions, discounts, and offering costs \| $	$ 12.2

Intangible Assets, Net

12 Months Ended

Dec. 31, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible Assets, Net

Intangible assets consisted of the following:


	As of December 31, 2023
	Gross Carrying Amount		Accumulated Amortization		Intangible Assets, Net
(in thousands)
Tradenames	$	780	$	(541)	$	239
Domain names	287		(217)		70
Total intangible assets, net	$	1,067	$	(758)	$	309


	As of December 31, 2022
	Gross Carrying Amount		Accumulated Amortization		Intangible Assets, Net
(in thousands)
Tradenames	$	770	$	(489)	$	281
Domain names	287		(198)		89
Total intangible assets, net	$	1,057	$	(687)	$	370

As of December 31, 2023 and 2022, the weighted average remaining useful lives for tradenames and domain names was 5.7 years and 3.9 years, respectively, and 6.2 years and 4.8 years, respectively.

Amortization expense was $0.1 million for each of the years ended December 31, 2023, 2022 and 2021, respectively. Estimated future amortization expense for each of the following five years ending December 31 and thereafter is as follows:


(in thousands)
2024	$	71
2025	71
2026	71
2027	30
2028	23
Thereafter	43
	$	309

Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2023

Accounting Policies [Abstract]

Schedules of Concentration of Risk, by Risk Factor

The Company’s customers that accounted for 10% or more of total accounts receivable, net, were as follows:


	As of December 31,
	2023		2022
Customer A	49	%	44	%
Customer B	25	%	15	%

The Company’s customers that accounted for 10% or more of total revenue were as follows:


	For the Year Ended December 31,
	2023		2022		2021
Customer A	31	%	31	%	28	%
Customer B	30	%	19	%	22	%

Useful Life of Assets

Depreciation and amortization are recorded using the straight-line method over the estimated useful lives of the assets as follows:


Machinery and equipment						3-20 years
Computer and office equipment						3-5 years
Capitalized software and website development costs						1-5 years
Furniture and fixtures						3-5 years
Building						40 years
Leasehold improvements						Lesser of the estimated useful life or the remaining lease term

Property and equipment consisted of the following:


	As of December 31,
	2023		2022
(in thousands)
Machinery and equipment	$	13,850	$	12,198
Computer and office equipment	1,700		1,794
Capitalized software	5,094		5,989
Furniture and fixtures	4,335		4,334
Leasehold improvements	15,829		15,839
Subtotal	40,808		40,154
Accumulated depreciation and amortization	(27,322)		(25,827)
Total property and equipment, net	$	13,486	$	14,327

Total depreciation and amortization expense for property and equipment, inclusive of depreciation expense for equipment under capital lease obligations consisted of the following:


	For the year ended December 31,
	2023		2022		2021
(In thousands)
Cost of revenues	$	931	$	1,013	$	2,198
Research and development	223		195		186
Selling, general and administrative	1,515		1,474		1,697
Total depreciation and amortization expense	$	2,669	$	2,682	$	4,081

Schedule of Sales Incentive Programs

The following table summarizes the changes in the allowance for sales incentive programs for retail and third-party ecommerce customers:


	For the year ended December 31,
(In thousands)	2023		2022		2021
Beginning balance	$	6,396	$	6,494	$	8,207
Charged to revenue	49,724		48,962		47,290
Charged to selling, general and administrative expense	659		550		—
Charged to marketing expense	17,056		12,541		16,150
Utilization of accrual for trade promotions	(64,522)		(61,954)		(65,153)
Reclassification to prepaid expenses and other current assets/accrued expenses	(933)		(197)		—
Ending balance	$	8,380	$	6,396	$	6,494

Stock-Based Compensation - Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions (Details) - Options - $ / shares	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected life of options (in years)	6 months	6 months
Expected stock price volatility (minimum)	69.20%	73.27%
Expected stock price volatility (maximum)	86.19%	79.56%
Risk free interest rate (minimum)	5.36%	1.52%
Risk free interest rate (maximum)	5.43%	4.65%
Expected dividend yield	0.00%	0.00%
Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted average grant-date fair value per share (in USD per share)	$ 0.56	$ 1.09
Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted average grant-date fair value per share (in USD per share)	$ 0.67	$ 1.12

Commitments and Contingencies - Summary of Purchase Commitments (Details) $ in Thousands	Dec. 31, 2023 USD ($)
Years Ending December 31,
2024	$ 3,369
2025	1,145
2026	474
2027	174
2028	0
Thereafter	0
Future minimum payments	$ 5,162

Revenue - Additional Information (Details) - USD ($)	12 Months Ended
Revenue - Additional Information (Details) - USD ($)	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Disaggregation of Revenue [Line Items]
Revenue	$ 344,365,000	$ 313,651,000	$ 318,639,000
Cost of revenue	$ 243,833,000	221,336,000	209,467,000
Trade Agreements
Disaggregation of Revenue [Line Items]
Marketing credits, usage period	4 years
Marketing credits, option to extend	2 years
Revenue	$ 0	3,200,000	4,200,000
Cost of revenue	0	1,700,000	2,200,000
Impairment	0	0	0
Transportation credits used	$ 300,000	$ 1,400,000	$ 400,000

- Definition

The aggregate cost of goods produced and sold and services rendered during the reporting period.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(g)(1)(ii))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 323
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 3
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481687/323-10-50-3

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 825
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 28
-Subparagraph (f)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482907/825-10-50-28

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(i))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480097/470-10-S99-1A

Reference 5: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(ii))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480097/470-10-S99-1A

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(iii)(A))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480097/470-10-S99-1A

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(iv))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480097/470-10-S99-1A

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(5))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480097/470-10-S99-1A

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(i))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480097/470-10-S99-1B

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(iii)(A))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480097/470-10-S99-1B

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(iii)(B))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480097/470-10-S99-1B

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(iv))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480097/470-10-S99-1B

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(5))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480097/470-10-S99-1B

Reference 14: http://fasb.org/us-gaap/role/ref/legacyRef
-Topic 220
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 2
-Subparagraph (SX 210.5-03.2)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483621/220-10-S99-2

+ Details

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References + Details

- Definition

+ References

+ Details

Intangible Assets, Net (Tables)

12 Months Ended

Dec. 31, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Finite-Lived Intangible Assets

Intangible assets consisted of the following:


	As of December 31, 2023
	Gross Carrying Amount		Accumulated Amortization		Intangible Assets, Net
(in thousands)
Tradenames	$	780	$	(541)	$	239
Domain names	287		(217)		70
Total intangible assets, net	$	1,067	$	(758)	$	309


	As of December 31, 2022
	Gross Carrying Amount		Accumulated Amortization		Intangible Assets, Net
(in thousands)
Tradenames	$	770	$	(489)	$	281
Domain names	287		(198)		89
Total intangible assets, net	$	1,057	$	(687)	$	370

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense

Estimated future amortization expense for each of the following five years ending December 31 and thereafter is as follows:


(in thousands)
2024	$	71
2025	71
2026	71
2027	30
2028	23
Thereafter	43
	$	309

Stock-Based Compensation

12 Months Ended

Dec. 31, 2023

Share-Based Payment Arrangement [Abstract]

Stock-Based Compensation

2011 Stock Incentive Plan

The Company’s 2011 Stock Incentive Plan (the “2011 Plan”), which is stockholder-approved, permits the grant of incentive and non-qualified stock options, stock awards, stock units or stock appreciation rights of common stock. Generally, stock options vest 25% on the first anniversary of the vesting commencement date and then monthly thereafter for 36 months, or pursuant to another vesting schedule as approved by the Board and set forth in the option agreement. Certain options and share awards provide for accelerated vesting upon certain events as described in the terms of the option and award agreements. Stock options have a maximum term of ten years. Prior to the IPO, all of the stock options and restricted stock units the Company granted were made pursuant to the 2011 Plan. Following the IPO, the Company grants equity incentive awards under the terms of the 2021 Plan (defined below).

The following table summarizes the stock option activity:


	Number of Options	Weighted Average Exercise Price		Weighted Average Contractual Term (Years)	Intrinsic Value (in thousands)





Outstanding at December 31, 2021	16,440,539	$	5.26	5.4	$	46,589
Granted	—	$	—
Exercised	(43,556)	$	2.81
Forfeited/Cancelled	(1,508,976)	$	5.50
Outstanding at December 31, 2022	14,888,007	$	5.24	4.0	$	3,024
Granted	—	$	—
Exercised	(2,300)	$	1.70
Forfeited/Cancelled	(1,569,911)	$	5.17
Outstanding at December 31, 2023	13,315,796	$	5.25	3.0	$	—

Exercisable at December 31, 2022	14,503,073	$	5.23	3.9	$	3,024
Exercisable at December 31, 2023	13,266,609	$	5.25	3.0	$	—

From 2018 to 2020, the Company granted stock options that vest based upon achieving a qualifying liquidity event, provided the employee remains employed on the date the vesting condition is satisfied. In conjunction with the IPO, 2,442,918 stock option awards with a weighted average exercise price of $5.54 vested based on the achievement of the IPO qualifying liquidity event, which resulted in the recognition of stock-based compensation expense of $3.1 million upon the effective date of the IPO registration statement.

The intrinsic value of options exercised during the years ended December 31, 2023, 2022 and 2021 were immaterial, $0.1 million and $6.0 million, respectively. This intrinsic value represents the difference between the fair value of the Company’s common stock on the date of exercise and the exercise price of each option. The total fair value of options vested during the years ended December 31, 2023, 2022 and 2021 were $0.7 million, $2.0 million and $7.9 million, respectively.

As of December 31, 2023 and 2022, there was $0.1 million and $1.0 million, respectively, of unrecognized stock-based compensation expense related to unvested stock options, which is expected to be recognized over a weighted-average period of 0.5 years and 1.3 years, respectively.

During the year ended December 31, 2023, the Company extended the post-termination exercise period for each outstanding stock option held by certain former executives such that the post-termination exercise period will end on the earlier of (i) the original expiration date of the stock option, or (ii) the date that is the 3-year anniversary of certain former executives no longer providing services to the Company. There were no changes to the exercise price or other terms of these stock options, and these stock options were already fully vested prior to the modification. As a result of this modification, we recognized incremental stock-based compensation expense of $0.5 million for the year ended December 31, 2023.

2021 Equity Incentive Plan

In April 2021, the Company’s board of directors adopted the Company’s 2021 Equity Incentive Plan (the “2021 Plan”), which became effective in connection with the IPO. All equity-based awards granted on or after the effectiveness of the 2021 Plan are granted under the 2021 Plan. The 2021 Plan provides for grants of incentive stock options (“ISOs”) within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”), to the Company’s employees and its parent and

subsidiary corporations’ employees, and for the grant of nonstatutory stock options (“NSOs”), stock appreciation rights, restricted stock awards, restricted stock units ("RSUs") awards, performance awards and other forms of awards to the Company’s employees, directors and consultants and any of its affiliates’ employees and consultants. Initially, the maximum number of shares of the Company’s common stock that may be issued under its 2021 Plan will not exceed 25,025,580 shares of the Company’s common stock. In addition, the number of shares of the Company’s common stock reserved for issuance under its 2021 Plan will automatically increase on January 1 of each year for a period of ten years, beginning on January 1, 2022 and continuing through January 1, 2031, in an amount equal to (1) 4% of the total number of shares of the Company’s common stock outstanding on December 31 of the immediately preceding year, or (2) a lesser number of shares determined by the Company’s board of directors prior to the date of the increase. On January 1, 2023, 3,713,026 additional shares were reserved for issuance pursuant to this provision. The maximum number of shares of the Company’s common stock that may be issued on the exercise of ISOs under its 2021 Plan is 75,100,000 shares.

The following table summarizes the RSU activity:


	Number of Shares		Weighted Average Grant Date Fair Value Per Share
	Non-Employee Directors	Directors, Officers and Employees	Non-Employee Directors		Directors, Officers and Employees




Unvested RSUs at December 31, 2021	103,561	2,867,306	$	16.00	$	13.58
Granted	485,806	3,113,741	$	3.51	$	5.07
Vested(1)	(131,775)	(1,121,573)	$	13.38	$	12.20
Forfeited	(4,641)	(694,071)	$	8.09	$	10.54
Unvested RSUs at December 31, 2022	452,951	4,165,403	$	3.44	$	8.09
Transfer from Employee to Non-Employee Director(2)	1,147,566	(1,147,566)	$	9.02	$	9.02
Granted	1,376,563	7,505,557	$	2.01	$	1.71
Vested(1)	(1,382,224)	(1,449,577)	$	5.84	$	6.31
Forfeited	(637,657)	(1,774,563)	$	7.07	$	5.44
Unvested RSUs at December 31, 2023	957,199	7,299,254	$	2.19	$	2.38

_______________

As of December 31, 2023 and 2022, there was $16.6 million and $31.2 million, respectively, of unrecognized stock-based compensation expense related to unvested RSUs, which is expected to be recognized over a weighted-average period of 3.0 years and 2.5 years, respectively.

2021 Employee Stock Purchase Plan

In April 2021, the Company’s board of directors adopted the Company’s 2021 Employee Stock Purchase Plan (the “2021 ESPP”). The Company authorized the issuance of 1,175,000 shares of common stock under the 2021 ESPP. In addition, the number of shares available for issuance under the 2021 ESPP will be annually increased on January 1 of each year for a period of ten years, beginning on January 1, 2022 and continuing through January 1, 2031 by the lesser of (i) 1% of the total number of shares of common stock outstanding on December 31 of the immediately preceding year; and (ii) 3,525,000 shares, except before the date of any such increase, the Company’s board of directors may determine that such increase will be less than the amount set forth in clauses (i) and (ii). On January 1, 2023, 928,256 additional shares were reserved for issuance pursuant to this provision. Subject to any limitations contained therein, the 2021 ESPP allows eligible employees to contribute (in the form of payroll deductions or otherwise to the extent permitted by the administrator) an amount established by the administrator from time to time in its discretion to purchase common stock at a discounted price per share.

Under the 2021 ESPP, eligible employees are granted the right to purchase shares of common stock at the lower of 85% of the fair value at the time of grant or 85% of the fair value at the time of exercise. The right to purchase shares of common stock is granted in May and November of each year for an offering period of approximately six months. The first offering period under the 2021 ESPP commenced in May 2021 and the second offering in November 2021. For the year ended December 31, 2023 and 2022, employees who elected to participate in the ESPP purchased 126,969 and 95,742 shares of common stock, respectively, under the 2021 ESPP, resulting in cash proceeds to the Company of $0.2 million and $0.3 million, respectively. The weighted

average price at purchase was $1.39 and $2.68 per share, respectively. As of December 31, 2023 and 2022, the Company had 2,756,394 and 1,955,107, respectively, remaining authorized shares available for purchase.

The following table summarizes the key input assumptions used in the Black-Scholes option-pricing model to estimate the grant-date fair value of the 2021 ESPP:


	For the Year Ended December 31,
	2023			2022
Expected life of options (in years)	0.50			0.50
Expected stock price volatility	69.20%	—	86.19%	73.27		%	—	79.56		%
Risk free interest rate	5.36%	—	5.43%	1.52		%	—	4.65		%
Expected dividend yield	—%			—%
Weighted average grant-date fair value per share	$0.56	—	$0.67	$	1.09		—	$	1.12

2023 Inducement Plan

In March 2023, the Company's Compensation Committee adopted the 2023 Inducement Plan (the “Inducement Plan”). The Inducement Plan reserved 4,000,000 shares of the Company’s common stock for issuance under the Inducement Plan to individuals who satisfy the standards for inducement grants under the relevant Nasdaq Stock Market rules.

On March 21, 2023, the Company granted 1,845,238 RSUs to the Chief Executive Officer under the Inducement Plan. On May 18, 2023, the Company granted 843,565 RSUs to the Chief Growth Officer under the Inducement Plan. On November 1, 2023, the Company granted 827,357 RSUs to the Chief Financial Officer under the Inducement Plan.

Stock-Based Compensation Expense

Stock-based compensation expense related to RSU awards, 2021 ESPP purchases and stock options, as applicable, are as follows:


	For the year ended December 31,
		2023		2022		2021
(In thousands)
Selling, general and administrative(1)		$	15,465	$	14,593	$	15,820
Research and development		339		485		1,027
Total stock-based compensation expense		$	15,804	$	15,078	$	16,847

__________________

Intangible Assets, Net - Schedule of Indefinite Assets, Net (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	$ 1,067	$ 1,057
Accumulated Amortization	(758)	(687)
Intangible Assets, Net	309	370
Tradenames
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	780	770
Accumulated Amortization	(541)	(489)
Intangible Assets, Net	239	281
Domain names
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	287	287
Accumulated Amortization	(217)	(198)
Intangible Assets, Net	$ 70	$ 89

Intangible Assets, Net - Schedule of Expected Remaining Amortization of Intangible Assets (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Goodwill and Intangible Assets Disclosure [Abstract]
2024	$ 71
2025	71
2026	71
2027	30
2028	23
Thereafter	43
Intangible Assets, Net	$ 309	$ 370

Property and Equipment, Net (Tables)

12 Months Ended

Dec. 31, 2023

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment

Depreciation and amortization are recorded using the straight-line method over the estimated useful lives of the assets as follows:


Machinery and equipment						3-20 years
Computer and office equipment						3-5 years
Capitalized software and website development costs						1-5 years
Furniture and fixtures						3-5 years
Building						40 years
Leasehold improvements						Lesser of the estimated useful life or the remaining lease term

Property and equipment consisted of the following:


	As of December 31,
	2023		2022
(in thousands)
Machinery and equipment	$	13,850	$	12,198
Computer and office equipment	1,700		1,794
Capitalized software	5,094		5,989
Furniture and fixtures	4,335		4,334
Leasehold improvements	15,829		15,839
Subtotal	40,808		40,154
Accumulated depreciation and amortization	(27,322)		(25,827)
Total property and equipment, net	$	13,486	$	14,327

Total depreciation and amortization expense for property and equipment, inclusive of depreciation expense for equipment under capital lease obligations consisted of the following:


	For the year ended December 31,
	2023		2022		2021
(In thousands)
Cost of revenues	$	931	$	1,013	$	2,198
Research and development	223		195		186
Selling, general and administrative	1,515		1,474		1,697
Total depreciation and amortization expense	$	2,669	$	2,682	$	4,081

Nature of Business (Details) - USD ($) $ / shares in Units, $ in Thousands			12 Months Ended
	May 07, 2021	May 06, 2021	Dec. 31, 2021	Dec. 31, 2023	Dec. 31, 2022	Apr. 30, 2021	Dec. 31, 2020
Sale of Stock [Line Items]
Common stock, par value (in USD per share)	$ 0.0001			$ 0.0001	$ 0.0001
Price per share (in USD per share)	$ 16.00
Underwriting commissions, discounts, and offering costs			$ 12,200
IPO Bonus	$ 9,500
Payroll taxes and expenses	200
Cash dividend declared						$ 35,000
Common stock authorized (in shares)		1,000,000,000		1,000,000,000	1,000,000,000
Preferred stock authorized (in shares)		20,000,000		20,000,000	20,000,000
Outstanding shares of redeemable convertible preferred stock (in shares)		49,100,928	0				49,100,928
Carrying Value		$ 376,400	$ 0				$ 376,404
Number of common stock issued from conversion (in shares)		49,649,023
Conversion of redeemable convertible preferred stock to common stock upon initial public offering	29,000		$ 376,405
Selling, general and administrative
Sale of Stock [Line Items]
IPO Bonus	9,100
Research and development
Sale of Stock [Line Items]
IPO Bonus	$ 400
IPO
Sale of Stock [Line Items]
Number of common stock issued in transaction (in shares)	25,807,000
Aggregate net proceeds	$ 91,000
Underwriting commissions, discounts, and offering costs	$ 6,700
IPO - Sold by Company
Sale of Stock [Line Items]
Number of common stock issued in transaction (in shares)	6,451,613
IPO - Sold by Existing Shareholders
Sale of Stock [Line Items]
Number of common stock issued in transaction (in shares)	19,355,387
IPO - Other Offering Expense
Sale of Stock [Line Items]
Underwriting commissions, discounts, and offering costs	$ 5,500
Over-Allotment Option
Sale of Stock [Line Items]
Number of common stock issued in transaction (in shares)	3,871,050
Option to purchase additional shares, period	30 days

Investments (Tables)

12 Months Ended

Dec. 31, 2023

Investments, Debt and Equity Securities [Abstract]

Schedule of Available-for-sale Investments

The following table summarizes the Company’s available-for-sale investments:


	As of December 31, 2022
	Cost or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Total Estimated Fair Value
(In thousands)
Corporate bonds	$	3,216	$	—	$	(24)	$	3,193
Commercial paper	582		—		—		582
Certificates of deposit	1,884		—		(9)		1,875

Total investments	$	5,682	$	—	$	(33)	$	5,650

- Definition

Tabular disclosure of investment in debt security measured at fair value with change in fair value recognized in other comprehensive income (available-for-sale).

+ References

Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 9
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-9

Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 3
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-3

Reference 3: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-2

Reference 4: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-2

Reference 5: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-2

Reference 6: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (aa)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-2

Reference 7: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (aaa)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-2

Reference 8: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-2

Reference 9: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 3
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-3

Reference 10: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 3
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-3

Reference 11: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 3
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-3

Reference 12: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 320
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 3
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481800/320-10-50-3

+ Details

Intangible Assets, Net - Additional Information (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Finite-Lived Intangible Assets [Line Items]
Intangible asset amortization expense	$ 0.1	$ 0.1	$ 0.1
Tradenames \| Weighted Average
Finite-Lived Intangible Assets [Line Items]
Intangible asset, estimated useful life	5 years 8 months 12 days	3 years 10 months 24 days
Domain names \| Weighted Average
Finite-Lived Intangible Assets [Line Items]
Intangible asset, estimated useful life	6 years 2 months 12 days	4 years 9 months 18 days

Restructuring (Tables)

12 Months Ended

Dec. 31, 2023

Restructuring and Related Activities [Abstract]

Restructuring and Related Costs


	Restructuring Costs
	Employee-Related Costs		Asset-Related Costs		Contract Terminations		Total

Charges for the year ended December 31, 2023	$	1,142	$	193	$	870	$	2,205

Schedule of Restructuring Reserve by Type of Cost

Changes in accrued expenses as of December 31, 2023 relating to the Transformation Initiative were:


	Restructuring Costs
	Employee-Related Costs(1)		Contract Terminations		Inventory Reserves		Total
Balance at December 31, 2022	$	—	$	—	$	—	$	—
Charges (adjustments)	1,142		479		5,166		6,787
Cash payments	(786)		(479)		(500)		(1,765)
Non-cash asset write-offs	—		—		(2,085)		(2,085)
Balance at December 31, 2023	$	356	$	—	$	2,581	$	2,937

___________

(1) Included in accrued expenses as of December 31, 2023. Refer to Note 9, "Accrued Expenses" included elsewhere in these consolidated financial statements.

Stock-Based Compensation - Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Number of Options
Options outstanding, beginning balance (in shares)	14,888,007	16,440,539
Granted (in shares)	0	0
Exercised (in shares)	(2,300)	(43,556)
Forfeited (in shares)	(1,569,911)	(1,508,976)
Options outstanding, ending balance (in shares)	13,315,796	14,888,007	16,440,539
Options exercisable (in shares)	13,266,609	14,503,073
Weighted Average Exercise Price
Weighted-average exercise price, beginning balance (in USD per share)	$ 5.24	$ 5.26
Weighted-average exercise price, granted (in USD per share)	0	0
Weighted-average exercise price, exercised (in USD per share)	1.70	2.81
Weighted-average exercise price, forfeited (in USD per share)	5.17	5.50
Weighted-average exercise price, ending balance (in USD per share)	5.25	5.24	$ 5.26
Weighted-average exercise price, exercisable (in USD per share)	$ 5.25	$ 5.23
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract]
Weighted Average Contractual Term (Years)	3 years	4 years	5 years 4 months 24 days
Weighted average contractual term, exercisable	3 years	3 years 10 months 24 days
Intrinsic Value (in thousands)	$ 0	$ 3,024	$ 46,589
Intrinsic Value, exercisable	$ 0	$ 3,024

Income Taxes - Components of Income Tax Provision (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Current
Federal	$ 0	$ 0	$ 0
State	75	110	77
Foreign	0	0	0
Current income tax expense total	75	110	77
Deferred
Federal	0	0	0
State	0	0	0
Foreign	0	0	0
Deferred income tax expense total	0	0	0
Income tax provision	$ 75	$ 110	$ 77