0001828962-22-000018 | 10-K | XBRL Viewer

Print Document View Excel Document

Description of Business and Basis of Presentation	12 Months Ended
Description of Business and Basis of Presentation	Dec. 31, 2021
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Description of Business and Basis of Presentation	Description of Business and Basis of Presentation Nature of Business Cricut, Inc. (“Cricut” or the “Company”) is a designer and marketer of a creativity platform that enables users to turn ideas into professional-looking handmade goods. Using the Company’s versatile connected machines, design apps and accessories and materials, users create everything from personalized birthday cards, mugs and T-shirts to large-scale interior decorations. The Company’s connected machines and related accessories and materials and subscription services are primarily marketed under the Cricut brand in the United States, as well as Europe and other countries of the world. Headquartered in South Jordan, Utah, the Company is an innovator in its industry, focused on bringing innovative technology (automation and consumerization of industrial tools) to the craft, DIY and home décor categories. The Company’s consolidated financial statements include the operations of its wholly owned subsidiaries, which are located throughout Europe and in the Asia-Pacific region. The Company designs, markets and distributes the Cricut family of products, including connected machines, design apps and accessories and materials. In addition, Cricut sells a broad line of images, fonts and projects for purchase à la carte. On September 2, 2020, Cricut converted from a Utah corporation to a Delaware corporation. In connection with such conversion, each share of Class A common stock, par value $0.01, of the Utah corporation was exchanged for one share of common stock of the Delaware corporation, par value $0.001. On March 11, 2021, the Company filed an Amended and Restated Certificate of Incorporation to effect a 64.2645654-for-1 forward stock split of its outstanding common stock. The par value per share was not adjusted as a result of the forward stock split. All authorized, issued and outstanding shares of common stock, additional paid in capital and the related per share amounts contained in the consolidated financial statements have been retroactively adjusted to reflect the forward stock split for all prior periods presented. The Company organizes its business into the following three reportable segments: Connected Machines, Subscriptions and Accessories and Materials. See Note 17 for further discussion of the Company’s segment reporting structure. Initial Public Offering and Corporate Reorganization The Company’s registration statement on Form S-1 related to its initial public offering (“IPO”) was declared effective on March 24, 2021 by the Securities and Exchange Commission (“SEC”), and the Company’s Class A common stock began trading on the Nasdaq Global Select Market on March 25, 2021. On March 29, 2021, the Company closed its IPO, in which the Company sold 13,250,000 shares of Class A common stock and the selling stockholders sold an additional 2,064,903 shares of Class A common stock at a price to the public of $20.00 per share. The Company received aggregate net proceeds of $242.7 million after deducting offering costs, underwriting discounts and commissions of $22.3 million. On April 28, 2021, the Company sold an additional 968,815 shares of Class A common stock and the selling stockholders sold an additional 150,984 shares of Class A common stock pursuant to the partial exercise of the underwriters’ option to purchase additional shares which generated net proceeds of $18.0 million after deducting for underwriting discounts and commissions of $1.4 million. Immediately prior to the IPO, the Company engaged in a series of related Corporate Reorganization transactions as follows: •Cricut, Inc. filed an amended and restated certificate of incorporation; and •Cricut Holdings, LLC, or Cricut Holdings, dissolved and liquidated in accordance with the terms and conditions of its then existing limited liability company agreement, pursuant to which the holders of existing units in Cricut Holdings (including holders of purchased units, incentive units, zero strike price incentive units, certain phantom units and options), or the Existing Unitholders, received 100% of the capital stock of Cricut, Inc., its sole asset, at the time of the liquidation with a value implied by the initial public offering price of the shares of Class A common stock to be sold in this offering. Cricut Holdings ceased to exist following this transaction. In connection with the Corporate Reorganization the outstanding stock-based compensation awards issued by Cricut Holdings were modified or settled as described in Note 11 below. Upon filing the amended and restated certificate of incorporation, all of the Company’s historical Common Stock converted to Class B common stock. Shares of Class A common stock is entitled to one vote per share. Each share of Class B common stock is entitled to five votes per share and is convertible at any time into one share of Class A common stock. Basis of Presentation and Consolidation The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States (“GAAP”). Certain prior year reported amounts have been reclassified to conform with the current period presentation. These reclassifications did not have a material impact on the Company's consolidated financial statements or related footnotes. The consolidated financial statements include the accounts of Cricut, Inc. and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation.

Stock-Based Compensation - Restricted Stock Units Activity Under Company's Stock Plans (Details) - Restricted stock units - 2021 Equity Incentive Plan	12 Months Ended
	Dec. 31, 2021 $ / shares shares
Number of Shares
Beginning balance (in shares) \| shares	0
Granted (in shares) \| shares	5,021,833
Vested (in shares) \| shares	(224,752)
Forfeited / cancelled (in shares) \| shares	(123,250)
Ending balance (in shares) \| shares	4,673,831
Weighted- Average Grant Date Fair Value (per share)
Beginning balance (in dollars per share) \| $ / shares	$ 0
Granted (in dollars per share) \| $ / shares	23.69
Vested (in dollars per share) \| $ / shares	20.00
Forfeited / cancelled (in dollars per share) \| $ / shares	24.68
Ending balance (in dollars per share) \| $ / shares	$ 23.84

Stock-Based Compensation - Summary of Liability Classified Incentive Unit Equivalents Rollforward (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Share-Based Compensation Arrangement By Share-Based Payment Award, Liability Classified Incentive Unit Equivalents, Outstanding [Roll Forward]
Stock-based compensation during period	$ 38,074	$ 9,484	$ 1,845
Liability Classified Incentive Unit Equivalents \| Accrued expenses
Share-Based Compensation Arrangement By Share-Based Payment Award, Liability Classified Incentive Unit Equivalents, Outstanding [Roll Forward]
Beginning balance	5,702	360	25
Stock-based compensation during period	6,041	5,161	305
Purchased unit equivalents during year		181	30
Settlement or modification of awards	(11,743)
Ending balance	$ 0	$ 5,702	$ 360

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Cash flows from operating activities:
Net income	$ 140,473	$ 154,578	$ 39,211
Adjustments to reconcile net income to net cash and cash equivalents (used in) provided by operating activities:
Depreciation and amortization (including amortization of debt issuance costs)	19,388	14,116	9,178
Impairment of trade name	0	0	747
Stock-based compensation	38,074	9,484	1,845
Deferred income tax	(135)	(2,463)	(1,257)
Non-cash lease expense	4,186	0	0
(Gain) loss on disposal of property and equipment	(2)	0	16
Provision for inventory obsolescence	5,070	2,802	5,193
Provision for doubtful accounts	1,096	128	699
Loss on extinguishment of debt	0	162	0
Changes in operating assets and liabilities:
Accounts receivable	(37,673)	(97,625)	(4,876)
Inventories	(207,978)	(37,979)	(73,233)
Prepaid expenses and other current assets	(27,942)	(2,991)	4,550
Other assets	(934)	(450)	(79)
Accounts payable	(46,667)	157,023	10,340
Accrued expenses and other current liabilities and other non-current liabilities	3,639	39,732	7,454
Operating lease liabilities	(4,672)	0	0
Deferred revenue	9,128	11,710	4,073
Net cash and cash equivalents (used in) provided by operating activities	(104,949)	248,227	3,861
Cash flows from investing activities:
Acquisitions of property and equipment, including capitalized software development costs	(35,786)	(21,842)	(14,095)
Net cash and cash equivalents used in investing activities	(35,786)	(21,842)	(14,095)
Cash flows from financing activities:
Proceeds from capital contributions	200	1,088	1,296
Proceeds from issuance of common stock upon initial public offering, net of offering costs	262,007	0	0
Repurchase of compensatory units	(170)	(3,038)	(728)
Proceeds from exercise of stock options	272	0	0
Employee tax withholding payments on stock-based awards	(2,017)	0	0
Payments on term loan	0	(22,917)	(4,417)
Drawdowns on revolving loan	0	228,269	502,730
Payments on revolving loan	0	(260,862)	(487,755)
Payments on capital leases	0	(81)	(127)
Payments for debt issuance costs	0	(854)	(103)
Cash dividend	0	(51,202)	0
Other financing activities, net	(48)	(1,318)	0
Net cash and cash equivalents (used in) provided by financing activities	260,244	(110,915)	10,896
Effect of exchange rate on changes on cash and cash equivalents	(127)	92	(25)
Net increase in cash and cash equivalents	119,382	115,562	637
Cash and cash equivalents at beginning of period	122,215	6,653	6,016
Cash and cash equivalents at end of period	241,597	122,215	6,653
Supplemental disclosures of cash flow information:
Cash paid during the period for interest	14	1,306	3,301
Cash paid during the period for income taxes	81,132	42,315	6,652
Supplemental disclosures of non-cash investing and financing activities:
Right-of-use assets obtained in exchange for new operating lease liabilities	6,805	0	0
Refinance of credit facility	0	0	11,667
Property and equipment included in accounts payable and accrued expenses and other current liabilities	3,355	2,585	4,245
Tax withholdings on stock-based awards included in accrued expenses and other current liabilities	860	0	0
Stock-based compensation capitalized for software development costs	1,607	253	85
Deferred offering costs in accounts payable and accrued expenses and other current liabilities	0	623	0
Reclassification of liability awards to equity upon modification	10,784	0	0
Leasehold improvements acquired through tenant allowances	0	936	0
Purchased unit equivalents issued in settlement of bonus	$ 0	$ 1,364	$ 0

Leases - Schedule of Maturities of Operating Lease Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Jan. 01, 2021	Dec. 31, 2020
Leases [Abstract]
2022	$ 4,305
2023	4,896
2024	4,619
2025	3,437
2026	2,960
Thereafter	748
Total lease payments	20,965
Less: imputed interest	(1,430)
Present value of operating lease liabilities	19,535
Operating lease liabilities, current portion	3,755	$ 3,918	$ 0
Operating lease liabilities, net of current portion	$ 15,780	$ 13,485	$ 0

Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2021

Accounting Policies [Abstract]

Schedule of Accounts Receivable

Accounts receivable consist of the following:


	December 31,
	2021		2020
(in thousands)
Trade accounts receivable	$	194,757	$	161,070
Other receivables	6,205		2,218
Less: Allowance for doubtful accounts	(1,454)		(357)
Total accounts receivable, net	$	199,508	$	162,931

Schedule Customer of Concentration

Customers that accounted for 10% or greater of accounts receivable, net as of December 31, 2021 and 2020 were as follows:


	December 31,
	2021		2020
Customer A	23	%	21	%
Customer B	*		16	%
Customer C	12	%	22	%
Customer D	*		10	%

* Accounts receivable was less than 10%.

Customers with revenue equal to or greater than 10% of total revenue for the periods indicated were as follows:


	Year Ended December 31,
	2021		2020		2019
Customer A	11	%	*		12	%
Customer B	*		11	%	11	%
Customer C	10	%	14	%	*
Customer D	14	%	14	%	21	%

* Revenue was less than 10%.

Property, Plant and Equipment

The Company uses the following estimated useful lives:


Computer software, software development costs and equipment						3-5 years
Furniture and fixtures						5-7 years
Manufacturing tools and equipment						3-5 years
Vehicles						5 years
Leasehold improvements						Shorter of lease term or remaining life of the asset

The composition of property and equipment is as follows:


	December 31,
	2021		2020
(in thousands)
Computer software, software development costs and equipment	$	70,663	$	50,242
Furniture and fixtures	5,243		5,184
Leasehold improvements	4,018		3,587
Manufacturing tools and equipment	29,753		15,563
Vehicles	—		22
Assets under construction	9,118		7,702
Total cost of property and equipment	118,795		82,300
Less: accumulated depreciation	(65,534)		(48,859)
Property and equipment, net	$	53,261	$	33,441

Schedule of Sale Refund Liability

Changes in the reserve for sales refunds were as follows:


	December 31,
	2021		2020
(in thousands)
Balance at beginning of period	$	3,515	$	941
Additions that reduced net revenue	15,889		8,664
Deductions from reserves for current year returns	(11,578)		(6,090)
Balance at end of period	$	7,826	$	3,515

Schedule of Product Warranty Reserves

Changes in the reserve for product warranties were as follows:


	December 31,
	2021		2020
(in thousands)
Warranty reserve, beginning of period	$	1,284	$	633
Additions charged to cost of revenue	7,261		2,683
Repairs and replacements	(6,147)		(2,032)
Warranty reserve, end of period	$	2,398	$	1,284

Impact of Adoption of Topic 842

The impact of the adoption of Topic 842 on the accompanying consolidated balance sheet as of January 1, 2021 was as follows:


	As reported December 31, 2020		Adjustments due to the adoption of Topic 842		As adjusted January 1, 2021
(in thousands)
Assets:
Operating lease right-of-use assets	$	—	$	15,036	$	15,036
Prepaid expenses and other current assets:					—
Prepaid rent	9		(9)		—
Liabilities:
Accounts payable and accrued liabilities
Operating lease liabilities - current	—		3,918		3,918
Deferred rent	2,376		(2,376)		—
Operating lease liabilities - non-current	$	—	$	13,485	$	13,485

Property and Equipment - Composition of Property and Equipment (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Property, Plant and Equipment [Line Items]
Total cost of property and equipment	$ 118,795	$ 82,300
Less: accumulated depreciation	(65,534)	(48,859)
Property and equipment, net	53,261	33,441
Computer software, software development costs and equipment
Property, Plant and Equipment [Line Items]
Total cost of property and equipment	70,663	50,242
Furniture and fixtures
Property, Plant and Equipment [Line Items]
Total cost of property and equipment	5,243	5,184
Leasehold improvements
Property, Plant and Equipment [Line Items]
Total cost of property and equipment	4,018	3,587
Manufacturing tools and equipment
Property, Plant and Equipment [Line Items]
Total cost of property and equipment	29,753	15,563
Vehicles
Property, Plant and Equipment [Line Items]
Total cost of property and equipment	0	22
Assets under construction
Property, Plant and Equipment [Line Items]
Total cost of property and equipment	$ 9,118	$ 7,702

Stock-Based Compensation - Schedule of Weighted-Average Valuation Assumptions (Details) - $ / shares	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected dividend	0.00%
Employee stock options \| 2021 Equity Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected volatility	51.60%
Risk-free interest rate	0.80%
Expected term (in years)	4 years 10 months 24 days
Expected dividend	0.00%
Employee stock options \| Common Class B
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected volatility	51.40%
Risk-free interest rate	0.80%
Expected term (in years)	5 years 6 months
Expected dividend	0.00%
Restricted Stock Unit Equivalents (“RSU equivalents”) \| 2021 Equity Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected volatility	80.50%
Risk-free interest rate	0.40%
Expected term (in years)	1 year
Expected dividend	0.00%
Equity Classified Incentive Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Fair value of common unit		$ 2.77	$ 0.80
Expected volatility		50.00%	42.90%
Risk-free interest rate		0.60%	2.30%
Expected term (in years)		3 years 2 months 12 days	3 years 6 months
Expected dividend		0.00%	0.00%
Equity Classified Incentive Units, Service and Market-Based
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Fair value of common unit	$ 2.95
Expected volatility	51.12%
Risk-free interest rate	0.24%
Participation Threshold	$ 5.00	$ 5.00
Likelihood of termination	10.00%
Equity Classified Incentive Units, Service and Market-Based \| Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Timing of liquidity event	2 years
Fair value thresholds	$ 6.00
Equity Classified Incentive Units, Service and Market-Based \| Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Timing of liquidity event	6 years
Fair value thresholds	$ 7.00
Equity Classified Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Fair value of common unit	$ 8.99	$ 6.24
Expected volatility	50.90%	52.50%
Risk-free interest rate	0.60%	0.30%
Expected term (in years)	5 years	3 years 6 months
Expected dividend	0.00%	0.00%
Liability Classified Incentive Unit Equivalents
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Fair value of common unit		$ 7.40	$ 1.85
Expected volatility		51.10%	40.20%
Risk-free interest rate		0.20%	1.60%
Expected dividend		0.00%	0.00%
Likelihood of termination		10.00%	10.00%
Liability Classified Incentive Unit Equivalents \| Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term (in years)		3 months 18 days	3 years
Liability Classified Incentive Unit Equivalents \| Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term (in years)		5 years	5 years

Leases - Additional Lease Information (Details)	Dec. 31, 2021
Leases [Abstract]
Weighted-average remaining lease term of operating leases	4 years 7 months 6 days
Weighted-average discount rate of operating leases	3.10%

Property and Equipment (Tables)

12 Months Ended

Dec. 31, 2021

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment

The Company uses the following estimated useful lives:


Computer software, software development costs and equipment						3-5 years
Furniture and fixtures						5-7 years
Manufacturing tools and equipment						3-5 years
Vehicles						5 years
Leasehold improvements						Shorter of lease term or remaining life of the asset

The composition of property and equipment is as follows:


	December 31,
	2021		2020
(in thousands)
Computer software, software development costs and equipment	$	70,663	$	50,242
Furniture and fixtures	5,243		5,184
Leasehold improvements	4,018		3,587
Manufacturing tools and equipment	29,753		15,563
Vehicles	—		22
Assets under construction	9,118		7,702
Total cost of property and equipment	118,795		82,300
Less: accumulated depreciation	(65,534)		(48,859)
Property and equipment, net	$	53,261	$	33,441

Summary of Significant Accounting Policies - Property, Plant and Equipment (Details)	12 Months Ended
	Dec. 31, 2021
Computer software, software development costs and equipment \| Minimum
Property, Plant and Equipment [Line Items]
Useful life	3 years
Computer software, software development costs and equipment \| Maximum
Property, Plant and Equipment [Line Items]
Useful life	5 years
Furniture and fixtures \| Minimum
Property, Plant and Equipment [Line Items]
Useful life	5 years
Furniture and fixtures \| Maximum
Property, Plant and Equipment [Line Items]
Useful life	7 years
Manufacturing tools and equipment \| Minimum
Property, Plant and Equipment [Line Items]
Useful life	3 years
Manufacturing tools and equipment \| Maximum
Property, Plant and Equipment [Line Items]
Useful life	5 years
Vehicles
Property, Plant and Equipment [Line Items]
Useful life	5 years

Stock-Based Compensation - Narrative (Details)	12 Months Ended			23 Months Ended
Stock-Based Compensation - Narrative (Details)	Dec. 31, 2021 USD ($) $ / shares shares	Dec. 31, 2020 USD ($) board_meeting d $ / shares shares	Dec. 31, 2019 USD ($)	Dec. 31, 2021 USD ($) shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation during period \| $	$ 38,074,000	$ 9,484,000	$ 1,845,000
Common Class B
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of awards issued \| shares	10,854,859	0		10,854,859
Weighted-average grant date fair value of options granted (in dollars per share) \| $ / shares	$ 13.42
Granted (in shares) \| shares	14,037,505
2021 Equity Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized stock-based compensation cost \| $	$ 14,500,000			$ 14,500,000
Stock-based compensation during period \| $	$ 5,800,000
2021 Equity Incentive Plan \| Common Class A
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock reserved for future issuance (in shares) \| shares	20,800,000			20,800,000
Incentive Unit Plan \| Tranche One
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of awards issued \| shares	3,000,000			3,000,000
Participation threshold before modification \| $	$ 2.00
Participation threshold after modification \| $	$ 3.00
Incentive Unit Plan \| Tranche Two
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of awards issued \| shares	3,000,000			3,000,000
Participation threshold before modification \| $	$ 2.00
Participation threshold after modification \| $	$ 4.00
Incentive Unit Plan \| Tranche Three
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of awards issued \| shares	1,000,000			1,000,000
Participation threshold before modification \| $	$ 5.00
Participation threshold after modification \| $	$ 6.00
Incentive Unit Plan \| Tranche Four
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of awards issued \| shares	1,000,000			1,000,000
Participation threshold before modification \| $	$ 5.00
Participation threshold after modification \| $	7.00
Equity-classified awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized stock-based compensation cost \| $	$ 125,800,000			$ 125,800,000
Unrecognized stock-based compensation cost, period for recognition	3 years 2 months 12 days
Employee stock options \| 2021 Equity Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expiration period	10 years
Minimum exercise price, percentage of fair market value of shares on date of grant	100.00%
Exercised aggregate intrinsic value \| $	$ 100,000
Weighted-average grant date fair value of options granted (in dollars per share) \| $ / shares	$ 8.79
Restricted Stock Unit Equivalents (“RSU equivalents”)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Amount of recognized liability \| $	$ 900,000			$ 900,000
Restricted Stock Unit Equivalents (“RSU equivalents”) \| 2021 Equity Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of awards issued \| shares	81,077	0		81,077
Vested aggregate intrinsic value \| $	$ 436,000
Weighted-average grant date fair value of options granted (in dollars per share) \| $ / shares	$ 7.57
Granted (in shares) \| shares	94,304
Employee stock \| 2021 Employee Stock Purchase Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Maximum eligible employee compensation contribution percentage	15.00%
Offering period	27 months
Employee stock \| 2021 Employee Stock Purchase Plan \| Common Class A
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of common stock available for sale (in shares) \| shares	4,000,000			4,000,000
Equity Classified Incentive Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of awards issued \| shares	0	37,116,025		0
Vested aggregate intrinsic value \| $	$ 0	$ 2,800,000	300,000
Percentage of awards vesting	25.00%
Award vesting period	4 years
Fair value of awards vested \| $	$ 3,200,000	$ 3,100,000	$ 400,000
Granted (in shares) \| shares	1,548,223
Equity Classified Incentive Units, Service and Market-Based
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting period	4 years
Granted (in shares) \| shares		3,000,000
Number of consecutive board meetings \| board_meeting		2
Minimum consecutive trading days \| d		100
Threshold consecutive trading days \| d		120
Participation Threshold \| $ / shares	$ 5.00	$ 5.00
Grant date fair value \| $	$ 2,300,000
Equity Classified Incentive Units, Service and Market-Based \| Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Fair value thresholds \| $ / shares	$ 6.00
Equity Classified Incentive Units, Service and Market-Based \| Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Fair value thresholds \| $ / shares	$ 7.00
Equity Classified Incentive Units, Service and Market-Based \| Tranche One
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted (in shares) \| shares		1,000,000
Equity Classified Incentive Units, Service and Market-Based \| Tranche Two
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted (in shares) \| shares		1,000,000
Fair value thresholds \| $ / shares		$ 6.00
Equity Classified Incentive Units, Service and Market-Based \| Tranche Three
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted (in shares) \| shares		1,000,000
Fair value thresholds \| $ / shares		$ 7.00
Liability Classified Incentive Unit Equivalents
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of awards issued \| shares	0	2,851,516		0
Award vesting period		5 years		4 years
Granted (in shares) \| shares	320,000
Liability Classified Incentive Unit Equivalents \| Tranche One
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of awards vesting		12.50%		25.00%
Liability Classified Incentive Unit Equivalents \| Tranche Two
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of awards vesting		12.50%		25.00%
Liability Classified Incentive Unit Equivalents \| Tranche Three
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of awards vesting		12.50%		25.00%
Liability Classified Incentive Unit Equivalents \| Tranche Four
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of awards vesting		12.50%		25.00%
Liability Classified Incentive Unit Equivalents \| Tranche Five
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of awards vesting		50.00%

Stock-Based Compensation - Summary of Outstanding Liability Classified Incentive Units (Details) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2021 USD ($) $ / shares shares
Aggregate Intrinsic Value
Exercisable aggregate intrinsic value \| $	$ 0
Liability Classified Incentive Unit Equivalents
Number of Shares
Beginning balance (in shares) \| shares	2,851,516
Granted (in shares) \| shares	320,000
Forfeited (in shares) \| shares	(4,000)
Cancelled (in shares) \| shares	(3,167,516)
Ending balance (in shares) \| shares	0
Exercisable (in shares) \| shares	0
Vested and expected to vest (in shares) \| shares	0
Weighted- Average Participation Threshold
Beginning weighted average participation threshold (in dollars per share) \| $ / shares	$ 2.13
Granted (in dollars per share) \| $ / shares
Forfeited (in dollars per share) \| $ / shares
Cancelled (in dollars per share) \| $ / shares	1.92
Ending weighted average participation threshold (in dollars per share) \| $ / shares	0
Exercisable (in dollars per share) \| $ / shares	0
Vested and expected to vest (in dollars per share) \| $ / shares	$ 0
Aggregate Intrinsic Value
Beginning aggregate intrinsic value \| $	$ 15,017
Ending aggregate intrinsic value \| $	0
Vested and expected to vest aggregate intrinsic value \| $	$ 0

Subsequent Events	12 Months Ended
Subsequent Events	Dec. 31, 2021
Subsequent Events [Abstract]
Subsequent Events	Subsequent Events On January 7, 2022, the Company granted 6,615,000 RSUs to employees and directors of the Company under the 2021 Equity Incentive Plan which vest in two equal tranches subject to the Company achieving cumulative adjusted earnings per share over eight quarters of $4.93 share and $6.16 per share, respectively.

Summary of Significant Accounting Policies - Schedule of Accounts Receivable (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Accounting Policies [Abstract]
Trade accounts receivable	$ 194,757	$ 161,070
Other receivables	6,205	2,218
Less: Allowance for doubtful accounts	(1,454)	(357)
Total accounts receivable, net	$ 199,508	$ 162,931

Net Income Per Share (Tables)

12 Months Ended

Dec. 31, 2021

Earnings Per Share [Abstract]

Schedule of Earnings Per Share, Basic and Diluted

The computation of net income per share is as follows:


	Year Ended December 31,
	2021		2020		2019
(in thousands, except share and per share amounts)
Basic earnings per share:
Net income	$	140,473	$	154,578	$	39,211
Shares used in computation:
Weighted-average common shares outstanding, basic	208,833,827		208,116,104		208,116,104
Earnings per share, basic	$	0.67	$	0.74	$	0.19

Diluted earnings per share:
Net income	$	140,473	$	154,578	$	39,211
Shares used in computation:
Weighted-average common shares outstanding, basic	208,833,827		208,116,104		208,116,104
Weighted-average effect of potentially dilutive securities:
Unvested common stock subject to forfeiture	9,132,579		—		—
Employee stock options	717,772		—		—
Restricted stock units	1,073,093		—		—
Underwriters’ option to purchase additional shares	18,798		—		—
Diluted weighted-average common shares outstanding	219,776,069		208,116,104		208,116,104
Diluted earnings per share	$	0.64	$	0.74	$	0.19

Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share

The following potentially dilutive shares were excluded from the computation of diluted earnings per share for the periods presented because including them would have had an anti-dilutive effect:


	Year Ended December 31,
	2021	2020	2019


Restricted stock units	786,500	—	—

Leases - Narrative (Details) - USD ($) $ in Millions	12 Months Ended
Leases - Narrative (Details) - USD ($) $ in Millions	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Lessee, Lease, Description [Line Items]
Lease obligations for additional space	$ 4.1
Operating lease cost	4.7
Variable lease cost	0.5
Cash paid for amounts included in the measurement of operating lease liabilities, included in net cash used in operating activities	$ 5.1
Rent expense of operating leases		$ 4.0	$ 4.2
Minimum
Lessee, Lease, Description [Line Items]
Lease term	1 year
Maximum
Lessee, Lease, Description [Line Items]
Lease term	10 years

Inventory

12 Months Ended

Dec. 31, 2021

Inventory Disclosure [Abstract]

Inventories

Inventories of finished goods are comprised of the following:


	December 31,
	2021		2020
(in thousands)
Raw Materials	$	20,187	$	714
Finished goods	433,987		248,031
Total Inventories	$	454,174	$	248,745

Segment Information - Narrative (Details) $ in Millions	12 Months Ended
Segment Information - Narrative (Details) $ in Millions	Dec. 31, 2021 USD ($) segment
Segment Reporting, Asset Reconciling Item [Line Items]
Number of reportable segments \| segment	3
Non-US
Segment Reporting, Asset Reconciling Item [Line Items]
Long-lived assets \| $	$ 13.5

Revenue and Deferred Revenue - Narrative (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Revenue from Contract with Customer [Abstract]
Revenue recognized related to performance obligations satisfied or partially satisfied in prior periods	$ 2.3
Revenue Benchmark \| Geographic Concentration Risk \| UNITED STATES
Concentration Risk [Line Items]
Concentration risk, percentage	96.00%	98.00%	98.00%

Net Income Per Share - Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share (Details) - shares	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Restricted stock units
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities (in shares)	786,500	0	0

Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands	Total	Common Stock	Additional Paid-In Capital	Accumulated Deficit	Accumulated Other Comprehensive Income (Loss)
Balance at beginning of period (in shares) at Dec. 31, 2018		208,116,104
Balance at beginning of period at Dec. 31, 2018	$ 79,766	$ 208	$ 457,380	$ (377,822)	$ 0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	39,211			39,211
Capital contributions	1,296		1,296
Stock-based compensation	1,625		1,625
Compensatory units repurchased	(728)		(728)
Other comprehensive income (loss)	(28)				(28)
Extinguishment of liability awards to equity	0
Balance at end of period (in shares) at Dec. 31, 2019		208,116,104
Balance at end of period at Dec. 31, 2019	121,142	$ 208	459,573	(338,611)	(28)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	154,578			154,578
Capital contributions	2,452		2,452
Stock-based compensation	4,956		4,956
Compensatory units repurchased	(3,038)		(3,038)
Other comprehensive income (loss)	37				37
Cash dividend	(51,202)		(51,202)
Extinguishment of liability awards to equity	0
Balance at end of period (in shares) at Dec. 31, 2020		208,116,104
Balance at end of period at Dec. 31, 2020	228,925	$ 208	412,741	(184,033)	9
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	140,473			140,473
Capital contributions	200		200
Stock-based compensation	35,755		35,755
Compensatory units repurchased	(170)		(170)
Other comprehensive income (loss)	(64)				(64)
Initial public offering, net of offering costs (in shares)		14,218,815
Initial public offering, net of offering costs	260,689	$ 14	260,675
Issuance of common stock upon vesting or exercise of stock-based awards, net of withholding tax (in shares)		121,014
Issuance of common stock upon vesting or exercise of stock-based awards, net of withholding tax	(2,606)		(2,606)
Forfeiture of unvested common stock (in shares)		(541,850)
Forfeiture of unvested common stock	0
Repurchase upon Corporate Reorganization (in shares)		(524)
Repurchase upon Corporate Reorganization	(10)		(10)
Extinguishment of liability awards to equity	10,784		10,784
Balance at end of period (in shares) at Dec. 31, 2021		221,913,559
Balance at end of period at Dec. 31, 2021	$ 673,976	$ 222	$ 717,369	$ (43,560)	$ (55)

Leases (Tables)

12 Months Ended

Dec. 31, 2021

Leases [Abstract]

Schedule of maturities of operating lease liabilities

As of December 31, 2021, the maturities of the Company's operating lease liabilities were as follows:


	Operating Leases
(in thousands)
2022	$	4,305
2023	4,896
2024	4,619
2025	3,437
2026	2,960
Thereafter	748
Total lease payments	$	20,965
Less: imputed interest	$	(1,430)
Present value of operating lease liabilities	$	19,535
Operating lease liabilities, current	$	3,755
Operating lease liabilities, non-current	$	15,780

Schedule of additional lease information

As of December 31, 2021, the weighted average remaining operating lease term and the weighted average discount rate used to determine the operating lease liability were as follows:


	As of December 31, 2021
Weighted-average remaining lease term of operating leases	4.6 years
Weighted-average discount rate of operating leases	3.1	%

Accrued Expenses and Other Current Liabilities - Schedule of accrued expenses and other current liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Payables and Accruals [Abstract]
Sales incentives and rebates	$ 36,969	$ 30,295
Other accrued liabilities and other current liabilities	32,382	41,029
Total accrued expenses	$ 69,351	$ 71,324

Revenue and Deferred Revenue (Tables)

12 Months Ended

Dec. 31, 2021

Revenue from Contract with Customer [Abstract]

Schedule of Changes in the Deferred Revenue Balance

The following table summarizes the changes in the deferred revenue balance for the periods indicated:


	December 31,
	2021		2020
(in thousands)
Deferred revenue, beginning of period	$	26,276	$	14,566
Recognition of revenue included in beginning of period deferred revenue	(23,518)		(13,188)
Revenue deferred, net of revenue recognized on contracts in the respective period	32,647		24,898
Deferred revenue, end of period	$	35,405	$	26,276

Schedule of Recognition of Deferred Revenue

The Company expects the following recognition of deferred revenue as of December 31, 2021:


	Year Ended December 31,
	2022		2023		2024		Total
(in thousands)
Revenue expected to be recognized	$	30,547	$	3,564	$	1,294	$	35,405

Schedule of Total Revenue by Geography

The following table presents the total revenue by geography based on the ship-to address for the periods indicated:


	Year Ended December 31,
	2021		2020		2019
(in thousands)
North America	$	1,157,679	$	888,266	$	469,110
International	148,548		70,764		17,444
Total revenue	$	1,306,227	$	959,030	$	486,554

Segment Information

12 Months Ended

Dec. 31, 2021

Segment Reporting [Abstract]

Segment Information

The Company applies ASC Topic 280, Segment Reporting, in determining reportable segments for its financial statement disclosure. The Company’s operating segments are generally organized by the type of product or service offered. Similar operating segments have been aggregated into three reportable segments: Connected Machines, Subscriptions and Accessories and Materials. Segment information is presented in the same manner that the Company’s Chief Operating Decision Maker (“CODM”) reviews the results of operations in assessing performance and allocating resources. The CODM reviews revenue and gross profit for each of the reportable segments. Gross profit is defined as revenue less cost of revenue incurred by the segment. The Company does not allocate assets at the reportable segment level as these are managed on an entity wide group basis. As of December 31, 2021, long-lived assets located outside the United States, primarily located in Malaysia and China, were $13.5 million.

The Connected Machines segment derives revenue from the sale of its connected machine hardware and related essential software. The Subscriptions segment derives revenue primarily from monthly and annual subscription fees and a minimal amount of revenue allocated to the unspecified future upgrades and enhancements related to the essential software and access to the Company’s cloud-based services. The Accessories and Materials segment primarily consists of craft, DIY, home décor products and heat presses including the Cricut Mug Press and Cricut EasyPress. There are no internal revenue transactions between the Company’s segments.

Key financial performance measures of the segments including revenue, cost of revenue and gross profit are as follows:


	Year Ended December 31,
	2021		2020		2019
(in thousands)
Connected Machines:
Revenue	$	548,205	$	416,714	$	198,144
Cost of revenue	484,025		351,898		176,894
Gross profit	$	64,180	$	64,816	$	21,250

Subscriptions:
Revenue	$	205,858	$	111,337	$	53,829
Cost of revenue	21,961		13,125		8,827
Gross profit	$	183,897	$	98,212	$	45,002

Accessories and Materials:
Revenue	$	552,164	$	430,979	$	234,581
Cost of revenue	342,791		261,633		158,483
Gross profit	$	209,373	$	169,346	$	76,098

Consolidated:
Revenue	$	1,306,227	$	959,030	$	486,554
Cost of revenue	848,777		626,656		344,204
Gross profit	$	457,450	$	332,374	$	142,350

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 31
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8924-108599

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 34
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8981-108599

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 21
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8721-108599

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 40
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9031-108599

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (f)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (e)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 26
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8844-108599

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 41
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9038-108599

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (d)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 22
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8736-108599

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 42
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9054-108599

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 15
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8657-108599

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 21
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8721-108599

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-URI http://asc.fasb.org/topic&trid=2134510

+ Details

Net Income Per Share - Schedule of Earnings Per Share, Basic and Diluted (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Basic earnings per share:
Net income	$ 140,473	$ 154,578	$ 39,211
Shares used in computation:
Weighted-average common shares outstanding, basic (in shares)	208,833,827	208,116,104	208,116,104
Earnings per share, basic (in dollars per share)	$ 0.67	$ 0.74	$ 0.19
Diluted earnings per share:
Net income	$ 140,473	$ 154,578	$ 39,211
Shares used in computation:
Weighted-average common shares outstanding, basic (in shares)	208,833,827	208,116,104	208,116,104
Weighted-average effect of potentially dilutive securities:
Unvested common stock subject to forfeiture (in shares)	9,132,579	0	0
Underwriters' option to purchase additional shares (in shares)	18,798	0	0
Diluted weighted-average common shares outstanding (in shares)	219,776,069	208,116,104	208,116,104
Diluted net income per share (in dollars per share)	$ 0.64	$ 0.74	$ 0.19
Employee stock options
Weighted-average effect of potentially dilutive securities:
Employee stock options / Restricted stock units (in shares)	717,772	0	0
Restricted stock units
Weighted-average effect of potentially dilutive securities:
Employee stock options / Restricted stock units (in shares)	1,073,093	0	0

Summary of Significant Accounting Policies - Impact of Adoption of Topic 842 (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Jan. 01, 2021	Dec. 31, 2020
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Operating lease right-of-use assets	$ 17,653	$ 15,036	$ 0
Prepaid rent		0	9
Operating lease liabilities - current	3,755	3,918	0
Deferred rent		0	2,376
Operating lease liabilities - non-current	$ 15,780	13,485	$ 0
Accounting Standards Update 2016-02
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Operating lease right-of-use assets		15,036
Prepaid rent		(9)
Operating lease liabilities - current		3,918
Deferred rent		(2,376)
Operating lease liabilities - non-current		$ 13,485

Description of Business and Basis of Presentation (Details) $ / shares in Units, $ in Millions				12 Months Ended
	Apr. 28, 2021 USD ($) shares	Mar. 29, 2021 USD ($) $ / shares shares	Mar. 11, 2021	Dec. 31, 2021 segment vote $ / shares shares	Mar. 24, 2021	Sep. 02, 2020 $ / shares	Sep. 01, 2020 $ / shares
Class of Stock [Line Items]
Common stock, par value (in dollars per share) \| $ / shares				$ 0.001
Stock split, conversion ratio			64.2645654
Number of reportable segments \| segment				3
Proceeds from IPO \| $	$ 18.0
Payments of stock issuance costs \| $	$ 1.4
Reorganization items, percent of capital stock					100.00%
Common Class A
Class of Stock [Line Items]
Common stock, par value (in dollars per share) \| $ / shares							$ 0.01
Sale of stock, shares issued in transaction	968,815
Number of votes per share \| vote				1
Number of shares issuable upon conversion (in shares)				1
Common Class A \| Existing Stockholders
Class of Stock [Line Items]
Sale of stock, shares issued in transaction	150,984			23,838,863
Common Stock
Class of Stock [Line Items]
Common stock, par value (in dollars per share) \| $ / shares						$ 0.001
Common Class B
Class of Stock [Line Items]
Number of votes per share \| vote				5
IPO
Class of Stock [Line Items]
Proceeds from IPO \| $		$ 242.7
Payments of stock issuance costs \| $		$ 22.3
IPO \| Common Class A
Class of Stock [Line Items]
Sale of stock, shares issued in transaction		13,250,000
Sale of stock, price per share (in dollars per share) \| $ / shares		$ 20.00
IPO \| Common Class A \| Existing Stockholders
Class of Stock [Line Items]
Sale of stock, shares issued in transaction		2,064,903

Segment Information - Schedule of Key Financial Performance Measures of the Segments (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Segment Reporting, Asset Reconciling Item [Line Items]
Revenue	$ 1,306,227	$ 959,030	$ 486,554
Cost of revenue	848,777	626,656	344,204
Gross profit	457,450	332,374	142,350
Connected machines
Segment Reporting, Asset Reconciling Item [Line Items]
Revenue	548,205	416,714	198,144
Cost of revenue	484,025	351,898	176,894
Gross profit	64,180	64,816	21,250
Subscriptions
Segment Reporting, Asset Reconciling Item [Line Items]
Revenue	205,858	111,337	53,829
Cost of revenue	21,961	13,125	8,827
Gross profit	183,897	98,212	45,002
Accessories and materials
Segment Reporting, Asset Reconciling Item [Line Items]
Revenue	552,164	430,979	234,581
Cost of revenue	342,791	261,633	158,483
Gross profit	$ 209,373	$ 169,346	$ 76,098

- 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
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(5))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442552-122756

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 825
-SubTopic 10
-Section 50
-Paragraph 28
-Subparagraph (f)
-URI http://asc.fasb.org/extlink&oid=123596393&loc=d3e14064-108612

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(g)(1)(ii))
-URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(iv))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442526-122756

Reference 5: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 220
-SubTopic 10
-Section S99
-Paragraph 2
-Subparagraph (SX 210.5-03.2)
-URI http://asc.fasb.org/extlink&oid=123367319&loc=SL114868664-224227

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 323
-SubTopic 10
-Section 50
-Paragraph 3
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=114001798&loc=d3e33918-111571

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(5))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442526-122756

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(i))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442552-122756

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(iii)(B))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442552-122756

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(iii)(A))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442552-122756

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(i))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442526-122756

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(iii)(A))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442526-122756

Reference 13: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(ii))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442526-122756

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(iv))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442552-122756

+ Details

- Definition

Aggregate revenue less cost of goods and services sold or operating expenses directly attributable to the revenue generation activity.

+ References

Reference 1: http://www.xbrl.org/2003/role/exampleRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 31
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8924-108599

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 30
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8906-108599

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 22
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8736-108599

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (f)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(iv))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442526-122756

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 323
-SubTopic 10
-Section 50
-Paragraph 3
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=114001798&loc=d3e33918-111571

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(iii)(A))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442552-122756

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(iii)(B))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442552-122756

Reference 9: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(ii))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442526-122756

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(g)(1)(ii))
-URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(i))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442526-122756

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(i))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442552-122756

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(iii)(A))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442526-122756

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 825
-SubTopic 10
-Section 50
-Paragraph 28
-Subparagraph (f)
-URI http://asc.fasb.org/extlink&oid=123596393&loc=d3e14064-108612

Reference 15: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(5))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442526-122756

Reference 16: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(iv))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442552-122756

Reference 17: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(5))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442552-122756

Reference 18: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 220
-SubTopic 10
-Section S99
-Paragraph 2
-Subparagraph (SX 210.5-03.1,2)
-URI http://asc.fasb.org/extlink&oid=123367319&loc=SL114868664-224227

Reference 19: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599

+ 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
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 30
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8906-108599

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 40
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9031-108599

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 41
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9038-108599

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 4
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130543-203045

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 22
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8736-108599

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 22
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8736-108599

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 42
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9054-108599

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 5
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130545-203045

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 924
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SAB Topic 11.L)
-URI http://asc.fasb.org/extlink&oid=6472922&loc=d3e499488-122856

+ Details

Leases

12 Months Ended

Dec. 31, 2021

Leases [Abstract]

Leases

The Company leases office space with lease terms ranging from 1 to 10 years. These leases require monthly lease payments that may be subject to annual increases throughout the lease term. Certain of these leases also include renewal options at the election of the Company to renew or extend the lease.

In December 2021, the Company amended its operating lease for its corporate headquarters in South Jordan, Utah to extend the term through March 2027 and to reduce the annual rent rate for future periods. As a result of this amendment, the Company remeasured the associated operating lease liability and right-of-use asset for this lease. The Company will also lease additional space at its corporate headquarters commencing in January of 2022 under the same terms as its existing lease. Lease obligations for the additional space total $4.1 million and are excluded from future maturities disclosed below.

The Company has determined its leases should be classified as operating leases. Variable lease costs are comprised primarily of the Company's proportionate share of operating expenses, property taxes, and insurance and are classified as lease cost due to the Company's election to not separate lease and non-lease components. For the year ended December 31, 2021, the Company incurred operating lease costs of $4.7 million and variable lease costs of $0.5 million.

Cash paid for amounts included in the measurement of operating lease liabilities for the year ended December 31, 2021 was $5.1 million and was included in net cash used in operating activities in the Company's consolidated statements of cash flows.

As of December 31, 2021, the maturities of the Company's operating lease liabilities were as follows:


	Operating Leases
(in thousands)
2022	$	4,305
2023	4,896
2024	4,619
2025	3,437
2026	2,960
Thereafter	748
Total lease payments	$	20,965
Less: imputed interest	$	(1,430)
Present value of operating lease liabilities	$	19,535
Operating lease liabilities, current	$	3,755
Operating lease liabilities, non-current	$	15,780

As of December 31, 2021, the weighted average remaining operating lease term and the weighted average discount rate used to determine the operating lease liability were as follows:


	As of December 31, 2021
Weighted-average remaining lease term of operating leases	4.6 years
Weighted-average discount rate of operating leases	3.1	%

Rent expense totaled $4.0 million and $4.2 million for the years ended December 31, 2020 and 2019, respectively.

Income Taxes - Components of Net Deferred Tax Assets (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Deferred tax assets:
Inventories	$ 3,387	$ 4,092
Deferred rent	0	370
Lease liability	5,068	0
Accounts receivable	372	83
Sales refund liability	2,002	816
Deferred revenue	1,243	640
Stock-based compensation	4,668	394
Amortization	149	182
Net operating loss carryforwards	146	171
Tax credits	1,003	1,064
Other	853	1,449
Total deferred tax assets	18,891	9,261
Deferred tax liabilities:
Depreciation and amortization	(11,215)	(6,142)
ROU lease asset	(4,421)	0
Total deferred tax liabilities	(15,636)	(6,142)
Net deferred tax assets	$ 3,255	$ 3,119

Revenue and Deferred Revenue

12 Months Ended

Dec. 31, 2021

Revenue from Contract with Customer [Abstract]

Revenue and Deferred Revenue

Revenue and Deferred RevenueDeferred revenue relates to performance obligations for which payments have been received from the customer prior to revenue recognition. Deferred revenue primarily consists of deferred subscription-based services. Deferred revenue also includes amounts allocated to the unspecified upgrades and enhancements and the Company’s cloud-based services. The Company had no material contract assets.

The following table summarizes the changes in the deferred revenue balance for the periods indicated:


	December 31,
	2021		2020
(in thousands)
Deferred revenue, beginning of period	$	26,276	$	14,566
Recognition of revenue included in beginning of period deferred revenue	(23,518)		(13,188)
Revenue deferred, net of revenue recognized on contracts in the respective period	32,647		24,898
Deferred revenue, end of period	$	35,405	$	26,276

As of December 31, 2021, the aggregate amount of the transaction price allocated to remaining performance obligations was equal to the deferred revenue balance.

The Company expects the following recognition of deferred revenue as of December 31, 2021:


	Year Ended December 31,
	2022		2023		2024		Total
(in thousands)
Revenue expected to be recognized	$	30,547	$	3,564	$	1,294	$	35,405

The Company’s revenue from contracts with customers disaggregated by major product lines, excluding sales-based taxes, are included in Note 17.

Revenue recognized during the year ended December 31, 2021 related to performance obligations satisfied or partially satisfied in prior periods was $2.3 million.

The following table presents the total revenue by geography based on the ship-to address for the periods indicated:


	Year Ended December 31,
	2021		2020		2019
(in thousands)
North America	$	1,157,679	$	888,266	$	469,110
International	148,548		70,764		17,444
Total revenue	$	1,306,227	$	959,030	$	486,554

North America revenue consists of revenues from the United States and Canada. United States represents 96%, 98%, and 98% of North America revenue for the years ended December 31, 2021, 2020, and 2019, respectively.

- 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.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-URI http://asc.fasb.org/topic&trid=49130388

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 10
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130551-203045

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 13
-Subparagraph (b)(2)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130556-203045

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 9
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130550-203045

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (e)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (d)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 15
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130558-203045

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045

+ Details

Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2021

Accounting Policies [Abstract]

Basis of Presentation

The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States (“GAAP”). Certain prior year reported amounts have been reclassified to conform with the current period presentation. These reclassifications did not have a material impact on the Company's consolidated financial statements or related footnotes.

Consolidation

The consolidated financial statements include the accounts of Cricut, Inc. and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. For revenue recognition, examples of estimates and judgments include: determining the nature and timing of satisfaction of performance obligations, determining the standalone selling price (“SSP”) of performance obligations, estimating variable consideration such as sales incentives and product returns. Other estimates include the warranty reserve, allowance for doubtful accounts, inventory reserve, intangible assets and other long-lived assets valuation, legal contingencies, stock-based compensation, income taxes, deferred tax assets valuation and developed software, among others. These estimates and assumptions are based on the Company’s best estimates and judgment. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including any effects of the ongoing pandemic and the economic environment, which management believes to be reasonable under the circumstances. Management adjusts such estimates and assumptions when facts and circumstances dictate. Actual results could differ from these estimates.

Comprehensive Income

Comprehensive IncomeComprehensive income consists of two components: net income and other comprehensive income (loss). Other comprehensive income (loss) refers to net gains and losses that are recorded as an element of stockholders’ equity but are excluded from net income. The Company’s other comprehensive income (loss) consists of foreign currency translation adjustments from those subsidiaries not using the U.S. dollar as their functional currency. Realized and unrealized foreign currency transaction gains and losses included in net income are recorded within operating expenses. Foreign currency transaction gains (losses) totaled $(0.9) million, $(0.3) million, and $0.2 million for the years ended December 31, 2021, 2020, and 2019, respectively.

Cash and Cash Equivalents

The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. Cash and cash equivalents include money market funds and are stated at fair value. The Company also classifies amounts in transit from payment processors for credit card and debit card transactions as cash equivalents.

Accounts Receivable

Accounts ReceivableAccounts receivable are recorded at original invoice amounts less estimates for credit losses. Management determines the allowance for credit losses by specifically identifying troubled accounts and by using historical write off experience, adjusted for current market conditions and reasonable supportable forecasts of future economic conditions, applied to an aging of all other accounts. Accounts receivable are written off when deemed uncollectible. Recoveries of accounts receivable previously written off are recorded when received.

Concentration of Credit Risk

The Company maintains cash and cash equivalents in deposit accounts at financial institutions that, at times, may significantly exceed federally insured limits. Historically, the Company has not experienced any losses related to such accounts. The Company’s non-interest bearing cash balances at December 31, 2021 and 2020 were fully insured up to $250,000 per depositor at each financial institution, and the Company’s non-interest bearing cash balances may significantly exceed federally insured limits.

Financial instruments, which potentially subject the Company to concentrations of credit risk, consist primarily of trade receivables. In the normal course of business, the Company provides credit terms to its customers. Accordingly, the Company performs ongoing credit evaluations of its customers, generally does not require collateral and considers the credit risk profile of the customer from which the receivable is due in further evaluating collection risk. The Company maintains allowances for possible losses which, when realized, have been within the range of management’s expectations. If one or more of the Company’s significant customers were to become insolvent or were otherwise unable to pay for product purchased, it would have a material adverse effect on the Company’s financial condition and results of consolidated operations. Customers that accounted for 10% or greater of accounts receivable, net as of December 31, 2021 and 2020 were as follows:


	December 31,
	2021		2020
Customer A	23	%	21	%
Customer B	*		16	%
Customer C	12	%	22	%
Customer D	*		10	%

* Accounts receivable was less than 10%.

Customers with revenue equal to or greater than 10% of total revenue for the periods indicated were as follows:


	Year Ended December 31,
	2021		2020		2019
Customer A	11	%	*		12	%
Customer B	*		11	%	11	%
Customer C	10	%	14	%	*
Customer D	14	%	14	%	21	%

* Revenue was less than 10%.

The revenue from these customers is associated with the Connected Machines and Accessories and Materials segments.

Supplier Concentration

The Company relies on third parties for the supply and manufacture of its products, as well as third-party logistics providers. In instances where these parties fail to perform their obligations, the Company may be unable to find alternative suppliers or satisfactorily deliver its products to its customers on time, if at all. Substantially all of the Company’s products are manufactured by outsourcing partners that are located primarily in Asia.

We rely on single source, or a small number of suppliers. For the year ended December 31, 2021, the Company’s top two vendors accounted for approximately 76% of total finished goods purchases. For the year ended December 31, 2020, the Company’s top two vendors accounted for approximately 73% of total finished goods purchases. For the year ended December 31, 2019, the Company’s top three vendors accounted for approximately 84% of total finished goods purchases.

Inventories

InventoriesInventories, which primarily consist of finished goods, are valued at the lower of average cost or net realizable value. Net realizable value is defined as estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. Assessments to value the inventory at the lower of the average cost to purchase the inventory, or the net realizable value of the inventory, are based upon assumptions about future demand, physical deterioration, changes in price levels and market conditions. As a result of the Company’s assessments, when the net realizable value of inventory is less than the carrying value, the inventory cost is written down to the net realizable value and the write down is recorded as a charge to cost of revenue. Inventories include indirect acquisition and production costs that are incurred to bring the inventories to their present condition and location. Inventories are recorded net of reserves for obsolescence. Once established, the original cost of the inventory less the related inventory reserve represents the new cost basis of such products.

Property and Equipment

Property and EquipmentProperty and equipment are stated at cost, less accumulated depreciation and amortization. Major additions and improvements are capitalized, while minor repairs and maintenance costs are expensed when incurred. Manufacturing tools include tools and molds used in the production process. Expenditures for tools and molds are capitalized and depreciated over the estimated useful lives of the assets. We capitalize certain software development costs in the application development stage in accordance with ASC 350-40, “Accounting for Costs of Computer Software Developed or Obtained for Internal Use” and upon the establishment of technological feasibility for a product in accordance with ASC 985-20, “Software to Be Sold, Leased or Otherwise Marketed. When assets are sold or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in the consolidated statements of operations. Depreciation and amortization are calculated using the straight-line method over the estimated useful lives of the related assets.

Leases

As described in “Recently adopted accounting standards” below, the Company adopted ASC 842, Leases (“ASC 842”) effective January 1, 2021. Under ASC 842, the Company determines if an arrangement is or contains a lease at inception by assessing whether the arrangement contains an identified asset and whether it has the right to control the identified asset. Right-of-use (ROU) assets represent the Company's right to use an underlying asset for the lease term and lease liabilities represent the Company's obligation to make lease payments arising from the lease. Lease liabilities are recognized at the lease commencement date based on the present value of future lease payments over the lease term. ROU assets are based on the measurement of the lease liability and also include any lease payments made prior to or on lease commencement and exclude lease incentives and initial direct costs incurred, as applicable.

As the implicit rate in the Company's leases is generally unknown, the Company uses its incremental borrowing rate based on the information available at the lease commencement date in determining the present value of future lease payments. The Company gives consideration to its credit risk, term of the lease, total lease payments and adjusts for the impacts of collateral, as necessary, when calculating its incremental borrowing rates. The Company evaluates renewal options at lease inception and on an ongoing basis, and includes renewal options that it is reasonably certain to exercise in its expected lease terms when classifying leases and measuring lease liabilities. Lease costs for the Company's operating leases are recognized on a straight-line basis within operating expenses and cost of revenue over the reasonably assured lease term.

The Company has elected to not separate lease and non-lease components for leases of office space and, as a result, accounts for any lease and non-lease components for office space as a single lease component, to the extent they are fixed. Non-lease components that are not fixed are expensed as incurred as variable lease payments. The Company’s office leases typically include non-lease components such as common-area maintenance costs. The Company has also elected to not apply the recognition requirement to any leases within its existing classes of assets with a term of 12 months or less.

Legal Contingencies

Liabilities for legal contingencies arising from claims, assessments, litigation, fines and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount of the assessment can be reasonably estimated. If a loss is reasonably possible and the loss or range of loss can be reasonably estimated, the Company discloses the possible loss or states that such an estimate cannot be made. See Note 12.

Debt Issuance Costs

Third-party costs incurred to obtain debt financing are capitalized and amortized using the effective interest method over the life of the debt instruments.

Costs incurred by the lender and paid by the Company for term debt are recorded as a reduction of the debt proceeds (debt discount) and are amortized to interest expense (see Note 8). Costs incurred by the lender and paid by the Company for the revolver debt are recorded as other assets and amortized over the term of the revolver using the straight-line method.

Impairment of Long-lived Assets

The Company assesses potential impairments to its long-lived assets, including intangible assets subject to amortization, on an annual basis or when there is evidence that events or changes in circumstances indicate that the carrying amount of an asset may not be recovered. The Company regularly evaluates whether events or circumstances have occurred that indicate possible impairment and relies on a number of factors, including results of operations, business plans, economic projections and anticipated future cash flows. An impairment loss is recognized when the carrying amount of the long-lived asset is not recoverable and exceeds its fair value. The carrying amount of a long-lived asset is not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset. Any required impairment loss is measured as the amount by which the carrying amount of a long-lived asset exceeds its fair value and is recorded as a reduction in the carrying value of the related asset and a charge to the consolidated statement of operations. During the years ended December 31, 2021, 2020, the Company recorded no impairments relating to amortized intangible assets. During the year ended December 31, 2019, the Company recorded $0.7 million in impairment within sales and marketing expense on the Company’s consolidated statements of operations relating to its amortized intangible assets (see Note 6). During the years ended December 31, 2021, 2020 and 2019, the Company recorded no impairments for certain property and equipment (see Note 5).

Fair Value of Financial Instruments

The Company’s financial instruments include cash and cash equivalents, accounts receivable, and accounts payable. At December 31, 2021, and 2020, the carrying amounts of cash, accounts receivable, and accounts payable approximate fair values because of the short-term nature of these instruments.

Fair Value Measurement

The Company measures at fair value certain of its financial and non-financial assets and liabilities by using a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. Fair value is 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, essentially an exit price, based on the highest and best use of the asset or liability. Fair value is affected by a number of factors, including the type of asset or liability, the characteristics specific to the asset or liability and the state of the marketplace including the existence and transparency of transactions between market participants. The Company estimates fair value for the assets and liabilities measured and reported at fair value on a recurring or non-recurring basis by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement.


			•			Level I – Quoted prices are available in active markets for identical assets and liabilities as of the reporting date.


			•			Level II – Significant other observable inputs (e.g., quoted prices for similar items in active markets, quoted prices for identical or similar items in markets that are not active, inputs other than quoted prices that are observable, such as interest rate and yield curves and market-corroborated inputs). Pricing inputs are either directly or indirectly observable as of the reporting date, and fair value is determined through the use of models or other valuation methodologies.


			•			Level III – Pricing inputs are unobservable for the assets and liabilities and includes situations where there is little, if any, market activity for the assets and liabilities. The inputs into the determination of fair value require significant management judgment or estimation.

The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability.

The Company’s non-financial assets and liabilities, which include intangible assets and property and equipment, are not required to be carried at fair value on a recurring basis. However, if certain triggering events occur such that a non-financial instrument is required to be evaluated for impairment, based upon a comparison of the non-financial instrument’s fair value to its carrying value, an impairment is recorded to reduce the carrying value to the fair value, if the carrying value exceeds the fair value. The inputs for fair value calculations of intangible assets and property and equipment, would be based on Level 3 inputs as data used for such fair value calculations would be based on discounted cash flows that are not observable from the market, directly or indirectly. The key variables that drive the discounted cash flow analysis are estimated revenue growth rates, levels of profitability, the terminal value growth rate assumptions and the weighted average cost of capital rate applied, among others.

No long-lived assets were measured at fair value on a recurring basis, and financial instruments measured at fair value on a recurring basis were not material at each of December 31, 2021 and 2020.

Money market funds are highly liquid investments and are actively traded. The pricing information for the Company’s money market funds are readily available and can be independently validated as of the measurement date. This approach results in the classification of these securities as Level 1 of the fair value hierarchy. There were no transfers between Levels 1, 2 or 3 for any of the periods presented.

Earnings Per Share

Earnings per share is computed using the two-class method required for multiple classes of common stock and participating securities. The rights, including the liquidation and dividend rights and sharing of losses, of the Class A common stock and Class B common stock are identical, other than voting rights. As the liquidation and dividend rights and sharing of profits are identical, the undistributed earnings are allocated on a proportionate basis and the resulting net income per share will, therefore, be the same for both Class A and Class B common stock on an individual or combined basis.

Basic earnings per share is computed using the weighted-average number of outstanding shares of common stock during the period. Diluted earnings per share is computed using the weighted-average number of outstanding shares of common stock and, when dilutive, potential shares of common stock outstanding during the period are determined under the treasury stock method.

Revenue Recognition

The Company derives the majority of its revenue from the sale of connected machines, digital content subscriptions and accessories and materials. The Company markets and sells its products to customers, which include brick-and-mortar and online retail partners as well as users that purchase from the Company’s website at cricut.com.

The Company determines revenue recognition through the following steps:


			•			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; and


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

Revenue is recognized when control of the promised goods or services is transferred to the Company’s customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. Revenue is recorded at the net sales price, which includes estimates of variable consideration such as product returns, volume rebates and sales incentives or discounts. The estimates of variable consideration are based on historical return experience, historical and projected sales data and current contract terms.

Taxes collected from customers relating to product sales and remitted to governmental authorities are excluded from revenue. The Company accounts for shipping and handling activities performed after a customer obtains control

of the goods as activities to fulfill the promise to transfer the good. The Company does not incur significant costs to obtain contracts with customers.

The following describes the nature of the Company’s primary types of revenue and the revenue recognition policies and significant payment terms as they pertain to the types of transactions with its customers.

Connected Machines

Connected machines include the Cricut Joy, Cricut Explore and Cricut Maker machine architectures. Payment for sale of products online through the online channel at cricut.com is collected at point of sale in advance of shipping the products. Payment by traditional brick-and-mortar retail partners, including their online channels, is due under customary fixed payment terms. The Company’s contracts with customers for a connected machine contain multiple promises that include hardware, software, unspecified future upgrades and enhancements related to the software and access to the Company’s cloud-based services. Determining whether products and services are considered distinct performance obligations that should be accounted for separately requires significant judgment. The Company’s software used to design, cut and complete projects can be accessed offline or with the cloud-based services at no charge. When accessed with the cloud-based services, users are also able to sync projects across various devices. The connected machines are not able to function without the software, inclusive of firmware and the downloadable software. Together the hardware and software are inputs into providing the essential functionality of the connected machines and are accounted for as a single performance obligation. Revenue is recognized for the single performance obligation of hardware with essential software at a point-in-time when control is transferred, which is either upon shipment or delivery of goods, in accordance with the terms of each contract with the customer.

The promise to provide the customer with unspecified future upgrades and enhancements related to the essential software and the promise to provide access to the Company’s cloud-based services are both distinct performance obligations that provide incremental benefits to the connected machines and are recognized using a time-based output measure over the service period as the customer consumes the benefit of the service each day. The Company estimates the service period since it is not contractually stated. In developing the estimated period of providing future services, the Company considers past history, plans to continue to provide services, expected technological developments, obsolescence, competition and other factors. The estimated service period may change in the future in response to competition, technology developments and the Company’s business strategy.

Judgment is required to determine the SSP for each distinct performance obligation. The Company allocates revenue to each performance obligation based on their relative SSP. The Company estimates SSP for items that are not sold separately, which include the connected machines and related software, unspecified software upgrades and cloud-based services using information that may include the range of prices for the bundle of products and services and the cost of providing the products or services plus a reasonable margin. In developing SSP estimates, the Company also considers the nature of the products and services and the expected level of future services. SSP of the hardware and essential software reflects the Company’s best estimate of the selling price if it was sold regularly on a standalone basis and comprises the majority of the contract value.

Subscriptions

The Company’s paid subscription services relate to Cricut Access and Cricut Access Premium which provide users access to images, fonts and projects, which is in addition to the free service of unspecified future upgrades and enhancements related to the essential software and access to the Company’s cloud-based services noted above. The paid subscription services are offered on a month-to-month or annual basis. Payments for subscription services are due month-to-month or annually in advance. Cricut Access and Cricut Access Premium are generally sold in standalone contracts and reallocations are not required. Revenue related to subscriptions is recognized ratably over the length of the subscription using a time-based output measure as the customer consumes the benefit of the service each day.

Accessories and Materials

The Company also sells accessories and materials (both physical and digital) which generally consist of a single performance obligation and reallocations are not required. Revenue from accessories and materials is recognized at a point-in-time when control is transferred, either upon shipment or delivery of goods, in accordance with the terms of each contract with the customer, or in the case of digital goods, at a point-in-time when the goods are made available to the customer. Payment for sale of accessories and materials through the online channel at

cricut.com is collected at point of sale in advance of shipping the products. Payment by traditional brick-and-mortar retail partners, including their online channels, is due under customary fixed payment terms.

Cost of Revenue

Connected Machines

Cost of revenue related to Connected Machines consists of product costs, including costs of contract manufacturers for production, inspecting and packaging, shipping, receiving, handling, warehousing and fulfillment, duties and other applicable importing costs, warranty replacement, excess and obsolete inventory write-downs, tooling and equipment depreciation and royalties.

Subscriptions

Cost of revenue related to Subscriptions consists primarily of hosting fees, digital content costs, amortization of capitalized software development costs and software maintenance costs.

Accessories and Materials

Costs of revenue related to Accessories and Materials consists of product costs, including costs of components, costs of contract manufacturers for production, inspecting and packaging, shipping, receiving, handling, warehousing and fulfillment, duties and other applicable importing costs, warranty replacement, excess and obsolete inventory write-downs, tooling and equipment depreciation and royalties.

Customer Rebates

The Company recognizes revenue at the net sales price, which includes certain estimates for variable consideration related to customer rebates with our key brick-and-mortar and online retail partners. These promotional programs are designed to enhance the sale of the Company’s products and consist of incentives to the Company’s customers. The promotional programs include advertising and product damage allowances, volume/growth and business development incentives and point-of-sale support. Sales incentives are considered to be variable consideration, which the Company estimates using the expected value method or most likely amount, based upon the nature of the incentive. Sales are reduced by the cost of these promotional and rebate programs and the Company records a related customer rebate liability in its consolidated balance sheets at the date of the transaction. Certain customer rebate programs are estimates at period end due to the nature of the incentives or expected and yet-to-be announced incentive programs that apply to current period revenue transactions. These estimates are based on the Company’s incentive program experience, historical and projected sales data and current contractual terms. The remaining portion of this liability is based on contractual amounts and does not require estimation.

In limited cases where the customer rebate is specifically for co-operative marketing or advertising campaigns, the Company classifies these expenditures as selling and marketing expenses only if they meet the criteria of being a distinct good or service, are distinct within the context of the contract and the fair value is readily estimable.

Sales Refund Liability

The Company provides its customers a limited right of return with the sale of its products. The Company estimates sales returns and records reserves at the time the related sales are recorded based on historical data and current economic trends. Actual sales returns could differ from these estimates. The Company regularly assesses and adjusts the estimate of accrued sales returns by updating the return rates for actual trends and projected costs. The Company classifies the estimated sales returns as a current liability as they are expected to be paid out in less than one year using the expected-value method. The estimated sales returns are recorded as a reduction of revenue at the time of sale and recorded as a liability on the consolidated balance sheets. At the same time this is recorded, a right of recovery asset is also recorded within inventory.

Shipping and Handling Revenue and Expenses

Shipping and handling revenue for orders placed by customers is recognized at the time of the sale. Shipping and handling expenses incurred by the Company related to these sales are considered fulfillment costs and reported as costs of revenue at the time of the sale.

Warranty Reserves

Warranty Reserves The Company provides an assurance-type limited warranty on most of the products sold. The estimated warranty costs, which are expensed at the time of sale and included in cost of revenue, are based on the results of product testing, industry and historical trends and warranty claim rates incurred and are adjusted for any current or expected trends as appropriate. Actual warranty claim costs could differ from these estimates. The Company regularly assesses and adjusts the estimate of accrued warranty claims by updating claims rates for actual trends and projected claim costs.

Income Taxes

The Company uses the asset and liability method of accounting for income taxes. The Company recognizes deferred tax liabilities and assets for the expected future income tax consequences of events that have been recognized in the Company’s consolidated financial statements. As such, deferred tax assets and liabilities are determined based on temporary differences between the financial carrying amounts and the tax basis of assets and liabilities using enacted tax rates in effect in the years in which the temporary differences are expected to reverse. On a periodic basis, the Company assesses the probability that its deferred tax assets, if any, will be recovered. If after evaluating all of the positive and negative evidence, a conclusion is made that it is more likely than not that some portion or all of the deferred tax assets will not be recovered, a valuation allowance is provided by a charge to tax expense to reserve the portion of the deferred tax assets which are not expected to be realized.

Under literature related to uncertain tax provisions, the Company reviews its filing positions for all open tax years in all U.S. federal and state jurisdictions where the Company is required to file. The Company recognizes a liability for each uncertain tax position at the amount estimated to be required to settle the issues.

The Company’s practice is to recognize interest and/or penalties related to income tax matters in income tax expense. For the years ended December 31, 2021, 2020 and 2019, interest or penalties related to income tax matters included in the provision for income taxes have not been material.

Stock-Based and Stock-Equivalent Compensation

The Company records compensation expense for all stock-based awards granted based on the fair value of the award at the time of the grant. Stock-based compensation costs are recognized as expense over the requisite service period, which is generally the vesting period, on a straight-line basis for awards with only a service condition. The graded vesting method is used for awards that have service and other conditions. For awards subject to performance vesting conditions, expense is recognized for the awards if it is probable the performance conditions will be met. Forfeitures are accounted for as they occur.

The Company estimates the fair value of awards with time-based or performance-based vesting provisions using the Black-Scholes method. The fair value of awards subject to market conditions prior to the Corporate Reorganization was estimated using a Monte Carlo Simulation. The determination of the grant date fair value of the awards issued is affected by a number of variables, including the fair value of the underlying shares or units, the expected price volatility over the expected life of the awards, the expected term of the award, risk-free interest rates, the expected dividend yield of the underlying shares or units and the likelihood of termination.

The Company has limited publicly available stock information and therefore, used the historical volatility of the stock price of similar publicly traded peer companies prior to its IPO in March 2021, and a blended average of average historical stock volatilities of peer companies and historical volatility of the Company's stock price for valuations subsequent to the IPO. The Company estimates the expected term using the simplified method for “plain vanilla” stock option awards or based on the expected time to a liquidation event or other transaction that would result in settlement of other awards. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant. Expected dividend yield is 0.0% as the Company does not anticipate paying dividends, and the Company and its former parent, Cricut Holdings, have not paid dividends other than a one-time dividend paid in 2020. Likelihood of termination for the Monte Carlo Simulation is estimated based upon both historical turnover and anticipated turnover based upon Company or market pressures.

Prior to the Corporate Reorganization, the Company’s former parent Cricut Holdings issued stock-based awards to employees of the Company. As the awards were issued by Cricut Holdings, the Company recorded a capital contribution from Cricut Holdings commensurate with the amount of compensation expense recognized in relation to the awards.

Incentive unit equivalents (phantom units) granted by Cricut Holdings to the Company’s employees entitled the recipient to future compensation based upon satisfaction of service conditions and were liability classified. The amount of compensation was determined by the change in the underlying value of Cricut Holdings common units. Since the awards also had a market condition, the Company recorded stock-based compensation expense over the requisite service period using the graded vesting method. The incentive unit equivalent awards were recorded at fair value and re-measured at fair value at each reporting period during the period from the date of grant through the settlement date. The impact of fair value re-measurement was recognized as compensation cost over the requisite service period.

Shipping and Handling Revenue and Expenses

Revenue Recognition

The Company determines revenue recognition through the following steps:


			•			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; and


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

of the goods as activities to fulfill the promise to transfer the good. The Company does not incur significant costs to obtain contracts with customers.

Connected Machines

Subscriptions

Accessories and Materials

Cost of Revenue

Connected Machines

Subscriptions

Cost of revenue related to Subscriptions consists primarily of hosting fees, digital content costs, amortization of capitalized software development costs and software maintenance costs.

Accessories and Materials

Customer Rebates

Sales Refund Liability

Shipping and Handling Revenue and Expenses

Advertising Costs

The Company incurs advertising costs associated with print, digital and other related broadcast advertisements. Advertising costs are expensed as incurred. Advertising expense for the years ended December 31, 2021, 2020 and 2019 was $45.1 million, $15.5 million, and $4.2 million respectively. Advertising costs include expenditures for shared advertising costs that the Company incurs under its co-operative advertising programs to the extent the fair value of the distinct good or service can reasonably be estimated.

Research and Development (“R&D”)

R&D expense consists of costs associated primarily with engineering, product development, quality assurance, service fees incurred by contracting with vendors and allocated overhead costs. R&D costs are expensed as incurred.

Recently Issued Accounting Standards

Recently adopted accounting standards

In February 2016 the FASB issued ASU 2016-02, Leases (“ASU 2016-02” or “Topic 842”). ASU 2016-02 amends a number of aspects of lease accounting, including requiring lessees to recognize leases with a term greater than one year as a right-of-use asset and corresponding liability, measured at the present value of the lease payments. On January 1, 2021, the Company adopted Topic 842 using the modified retrospective approach. Results for the twelve months ended December 31, 2021 are presented under Topic 842. No prior period amounts were adjusted and continue to be reported in accordance with previous lease guidance, ASC Topic 840, Leases.

The new standard provides a number of optional practical expedients in transition. The Company elected the practical expedients to not reassess its prior conclusions about lease identification under the new standard, to not reassess lease classification, to not reassess initial direct costs, and to use hindsight in determining the lease term and in assessing impairment of the Company's right-of-use assets.

The impact of the adoption of Topic 842 on the accompanying consolidated balance sheet as of January 1, 2021 was as follows:


	As reported December 31, 2020		Adjustments due to the adoption of Topic 842		As adjusted January 1, 2021
(in thousands)
Assets:
Operating lease right-of-use assets	$	—	$	15,036	$	15,036
Prepaid expenses and other current assets:					—
Prepaid rent	9		(9)		—
Liabilities:
Accounts payable and accrued liabilities
Operating lease liabilities - current	—		3,918		3,918
Deferred rent	2,376		(2,376)		—
Operating lease liabilities - non-current	$	—	$	13,485	$	13,485

The adjustments due to the adoption of Topic 842 related to the recognition of operating lease right-of-use assets and operating lease liabilities for the existing operating leases. The adoption of the new standard did not have an impact on the Company's beginning equity, statement of operations or cash flows.

In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments – Credit Losses” (Topic 326). ASU 2016-13 modifies the measurement of expected credit losses of certain financial instruments, requiring entities to estimate an expected lifetime credit loss on financial assets. For available-for-sale debt securities in unrealized loss positions, ASU 2016-13 requires allowances to be recorded instead of reducing the amortized cost of the investment. ASU 2016-13 became effective on January 1, 2021. The adoption of ASU 2016-13 did not have a material impact on the Company’s consolidated financial statements and related disclosures.

In December 2019, the FASB issued ASU No. 2019-12, “Income Taxes” (Topic 740). ASU 2019-12 removes certain exceptions for investments, intraperiod allocations and interim calculations and adds guidance to reduce complexity in accounting for income taxes. The Company adopted this standard effective January 1, 2021. The adoption of ASU 2019-12 did not have a material impact on the Company’s consolidated financial statements and related disclosures.

In August 2018, the FASB issued ASU 2018-15, Intangibles – Goodwill and Other – Internal Use Software (Subtopic 350-40) – Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract, which aligns the accounting for implementation costs incurred in a hosting arrangement that is a service contract with the accounting for implementation costs incurred to develop or obtain internal-use software under ASC 350-40, in order to determine which costs to capitalize and recognize as an asset and which costs to expense. The Company adopted this standard on a prospective basis effective January 1, 2021. During the year ended December 31, 2021, the Company capitalized $1.4 million of implementation costs under this standard primarily related to the implementation of additional accounting and financial reporting tools. These costs are recorded within other assets in the consolidated balance sheets and amortized on a straight-line basis over the term of the associated hosting arrangement. Amortization of implementation costs during the year ended December 31, 2021 was not significant.

Intangible Assets, Net - Narrative (Details) - USD ($)	12 Months Ended
Intangible Assets, Net - Narrative (Details) - USD ($)	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Finite-Lived Intangible Assets [Line Items]
Impairment of intangible assets	$ 0	$ 0	$ 700,000
Amortization of intangible assets	$ 800,000	$ 800,000	$ 800,000
Trade names and trademarks \| Minimum
Finite-Lived Intangible Assets [Line Items]
Useful life	11 years
Trade names and trademarks \| Maximum
Finite-Lived Intangible Assets [Line Items]
Useful life	15 years

Accrued Expenses and Other Current Liabilities (Tables)

12 Months Ended

Dec. 31, 2021

Payables and Accruals [Abstract]

Schedule of accrued expenses and other current liabilities

Accrued expenses and other current liabilities consist of the following:


	December 31,
	2021		2020
(in thousands)
Sales incentives and rebates	$	36,969	$	30,295
Other accrued liabilities and other current liabilities	32,382		41,029
Total accrued expenses	$	69,351	$	71,324

Inventories - Components of Inventories (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Inventory Disclosure [Abstract]
Raw Materials	$ 20,187	$ 714
Finished goods	433,987	248,031
Total Inventories	$ 454,174	$ 248,745

Revolving Credit Facility	12 Months Ended
Revolving Credit Facility	Dec. 31, 2021
Debt Disclosure [Abstract]
Revolving Credit Facility	Revolving Credit Facility 2020 Credit Agreement In September 2020, the Company entered into the Credit Agreement with JPMorgan Chase Bank, N.A., Citibank, N.A. and Origin Bank. The Credit Agreement replaces the prior amended credit agreement with Origin Bank. The Credit Agreement provides for a three-year asset-based senior secured revolving credit facility of up to $150.0 million, maturing on September 4, 2023. During the term of the Credit Agreement, the Company may increase the aggregate amount of the credit facility by up to an additional $200.0 million, (for maximum aggregate lender commitments of up to $350.0 million), subject to the satisfaction of certain conditions under the Credit Agreement, including obtaining the consent of the administrative agent and an increased commitment from existing or new lenders. The credit facility may be used to issue letters of credit and for other business purposes, including working capital needs. The amount that can be borrowed under the Credit Agreement is limited to the lesser of (a) the borrowing base minus the aggregate revolving exposure or (b) aggregate lender commitments at any given time. The borrowing base is determined according to certain percentages of eligible accounts receivable and eligible inventory (which may be valued at average cost, market value or net orderly liquidation value), subject to reserves determined by the administrative agent. At any time that the Company’s borrowing base is less than the aggregate lender commitments, the Company can only borrow revolving loans up to the amount of the Company’s borrowing base and not in the full amount of the aggregate lender commitments. As of December 31, 2021, no amount was outstanding under the Credit Agreement and available borrowings were $150.0 million. Generally, borrowings under the Credit Agreement bear interest at a rate based on LIBOR (“Adjusted LIBO rate”) or an alternative base rate (“ABR”), plus, in each case, an applicable margin. The applicable margin will range from (a) with respect to borrowings bearing interest at the ABR, 1.50% to 2.00%, and (b) with respect to borrowings bearing interest at the ABR (i) if the “REVLIBOR30 Screen Rate” (as defined in the Credit Agreement) is available for such period, 1.50% to 2.00%, or (ii) otherwise, 0.00% to 0.50%, in each case for the previous clauses (a) and (b), based on our “Fixed Charge Coverage Ratio” as defined in the Credit Agreement. The Credit Agreement contains financial covenants during the initial year of the agreement, requiring the Company to maintain a fixed charge coverage ratio of at least 1.0 to 1.0, measured monthly on a trailing 12 month basis. The Company is also subject to this covenant in future periods if the available commitment is less than the greater of $15.0 million and 10% of total commitment made by all lenders. Management has determined that the Company was in compliance with all financial and non-financial debt covenants as of December 31, 2021.

- 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://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-URI http://asc.fasb.org/topic&trid=2208564

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (h)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1C
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1I
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1I
-Subparagraph (d)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(c))
-URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (g)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1C
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1C
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1E
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495348-112611

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1I
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (i)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

+ Details

Stock-Based Compensation

12 Months Ended

Dec. 31, 2021

Share-based Payment Arrangement [Abstract]

Stock-Based Compensation

Stock-based Compensation Cost

The following table shows the stock-based compensation cost by award type for the periods indicated:


	Year Ended December 31,
	2021		2020		2019
(in thousands)
Equity-classified awards	$	35,755	$	4,956	$	1,625
Liability-classified awards	6,447		5,161		305
Total stock-based compensation	$	42,202	$	10,117	$	1,930

The following table sets forth the total stock-based compensation cost included in the Company’s consolidated statements of operations and comprehensive income or capitalized to assets for the periods indicated:


	Year Ended December 31,
	2021		2020		2019
(in thousands)
Cost of revenue
Connected machines	$	34	$	7	$	2
Subscriptions	219		31		11
Accessories and materials	—		—		—
Total cost of revenue	253		38		13
Research and development	15,782		3,332		881
Sales and marketing	13,814		4,794		623
General and administrative	8,225		1,320		328
Total stock-based compensation expense	$	38,074	$	9,484	$	1,845
Capitalized for software development costs	$	1,607	$	253	$	85
Capitalized to inventory	$	2,521	$	380	$	—
Total stock-based compensation	$	42,202	$	10,117	$	1,930

As of December 31, 2021, there was $125.8 million of unrecognized stock-based compensation cost related to stock-based awards which is expected to be recognized over a weighted-average period of 3.2 years.

Corporate Reorganization and Stock-Based Compensation Modifications

In connection with the Corporate Reorganization, all outstanding awards issued under the Incentive Unit Plan discussed below were modified by exchanging the outstanding awards of Cricut Holdings for awards of the Company. All service based vesting conditions were unaffected by the modification. As described below, the vesting conditions were modified for certain awards which previously had both service and market based vesting conditions.

All vested equity classified awards were settled in shares of the Company’s Class B common stock previously held by Cricut Holdings. Unvested equity classified awards were converted to unvested shares of the Company’s Class B common stock subject to future vesting, or in the case of options were converted into options to purchase the Company’s Class B common stock. All vested liability classified awards converted into either shares of Class B common stock to the extent permitted in each applicable jurisdiction or settled in cash. All unvested liability classified awards converted into restricted stock units (“RSUs”) under the 2021 Equity Incentive Plan that will vest into shares of Class A common stock of Cricut, Inc. to the extent permitted in each applicable jurisdiction or into restricted stock unit equivalents which will be settled in cash upon vesting as described below.

In connection with the Corporate Reorganization and modification, the Company granted options under the 2021 Equity Incentive Plan to certain employees. The number of options was calculated based on the number of outstanding incentive units or incentive unit equivalents prior to the modification and the participation threshold of such awards. The vesting terms of the options are also based on the vesting terms of the original award. Therefore, the Company considered the exchange of the original award for the unvested shares or RSUs plus the options to be a single modification and will recognize the incremental compensation cost of $14.5 million over the vesting term. Of this amount, the Company recognized $5.8 million during the year ended December 31, 2021 including a cumulative adjustment in March 2021 to recognize the incremental compensation cost associated with historical vesting.

As part of the modification of outstanding awards in connection with the Corporate Reorganization, awards issued under the Incentive Unit Plan which included both service and market conditions were modified to remove the market vesting condition and to increase the participation threshold of the award to the price specified in the former market condition. In total, 3.0 million, 3.0 million, 1.0 million and 1.0 million awards which previously had a participation threshold of $2.00, $2.00, $5.00 and $5.00 per share, respectively, were modified to have a participation threshold of $3.00, $4.00, $6.00 and $7.00 per share, respectively. Incremental compensation cost associated with these awards is included in the total incremental compensation cost associated with the issuance of additional options to employees described above as this change was part of a single modification.

These modifications are shown as cancellations under the Incentive Unit Plan and as grants under the activity summarized below.

2021 Equity Incentive Plan

In March 2021, the Company’s 2021 Equity Incentive Plan became effective. The 2021 Equity Incentive Plan provides for the grant of incentive stock options to employees and for the grant of nonstatutory stock options, restricted stock, restricted stock units, stock appreciation rights, performance units and performance shares to our employees, directors and consultants and our parent and subsidiary corporations’ employees and consultants. As of December 31, 2021, 20,800,000 shares of Class A common stock were reserved for issuance under this plan including shares reserved for previously granted awards discussed below as well as shares reserved for issuance of future awards under the plan.

A summary of the Company’s RSU activity under the 2021 Equity Incentive Plan is as follows:


	Number of RSUs	Weighted- Average Grant Date Fair Value (per share)
Outstanding at December 31, 2020	—	$	—
Granted	5,021,833	$	23.69
Vested	(224,752)	$	20.00
Forfeited/cancelled	(123,250)	$	24.68
Outstanding at December 31, 2021	4,673,831	$	23.84

Options under the 2021 Equity Incentive Plan have a contractual term of 10 years. The exercise price of an incentive stock option and non-qualified stock option shall not be less than 100% of the fair market value of the shares on the date of grant.

A summary of the Company’s stock option activity under the 2021 Equity Incentive Plan is as follows:


	Number of Options	Weighted- Average Exercise Price		Weighted- Average Remaining Term (Years)	Aggregate Intrinsic Value
					(in thousands)
Outstanding at December 31, 2020	—	$	—
Granted	3,419,359	20.00
Exercised	(13,592)	20.00
Forfeited/cancelled	(145,410)	20.00
Outstanding at December 31, 2021	3,260,357	$	20.00	5.8	$	6,814
Vested and exercisable at December 31, 2021	1,379,702	$	20.00	5.1	$	2,884

For the year ended December 31, 2021, the total intrinsic value of options exercised was $0.1 million. The weighted-average grant date fair value of options granted under the 2021 Equity Incentive Plan during the year ended December 31, 2021 was $8.79 per share based on the following weighted-average assumptions:


	Year Ended December 31, 2021
Expected volatility	51.6	%
Risk-free interest rate	0.8	%
Expected term (in years)	4.9
Expected dividend	—	%

In connection with the Corporate Reorganization, certain employees received restricted stock unit equivalents (“RSU equivalents”). Upon vesting, these awards are settled for a cash payment equal to the intrinsic value of the award on the date of the Corporate Reorganization plus the difference between the Company’s stock price on the vesting date less the base price specified at the time of the grant. Due to the cash settlement feature, these awards are liability classified awards and require initial and subsequent measurement at fair value. As of December 31, 2021, the total recognized liability for these awards was $0.9 million which was included in accrued expenses and other current liabilities per the Company’s consolidated balance sheets. A summary of the RSU equivalent activity under the 2021 Equity Incentive Plan is as follows:


	Number of RSU Equivalents	Weighted- Average Base Price		Aggregate Intrinsic Value
				(in thousands)
Outstanding at December 31, 2020	—
Granted	94,304	20.00
Vested	(13,227)	$	20.00	$	436
Outstanding at December 31, 2021	81,077	$	20.00	$	1,231

The weighted-average fair value of RSU equivalents granted under the 2021 Equity Incentive Plan during the year ended December 31, 2021 was $7.57 per share based on the following weighted-average assumptions:


	Year Ended December 31, 2021
Expected volatility	80.5	%
Risk-free interest rate	0.4	%
Expected term (in years)	1.0
Expected dividend	—	%

Unvested Class B Common Stock

The Company’s unvested Class B common stock resulted from the Corporate Reorganization and is not part of the 2021 Equity Incentive Plan. Activity related to Class B common stock subject to future vesting for the year ended December 31, 2021 is as follows:


	Number of Unvested Shares	Weighted- Average Grant Date Fair Value (per share)
Outstanding at December 31, 2020	—
Granted	14,037,505	$	20.00
Vested	(2,643,782)	$	20.00
Forfeited / Cancelled	(538,864)	$	20.00
Outstanding at December 31, 2021	10,854,859	$	20.00

Options to Purchase Class B Common Stock

The Company’s options to purchase Class B common stock resulted from the Corporate Reorganization and are not part of the 2021 Equity Incentive Plan. A summary of the Company stock option activity for the options to purchase shares of Class B common stock is as follows:


	Number of Options	Weighted- Average Exercise Price		Weighted- Average Remaining Term (Years)	Aggregate Intrinsic Value
					(in thousands)
Outstanding at December 31, 2020	—
Granted	522,000	$	9.04
Forfeited / Cancelled	(88,000)	$	9.04
Outstanding at December 31, 2021	434,000	$	9.04	3.9	$	5,664
Vested at December 31, 2021	—	$	—	N/A	$	—

The weighted-average grant date fair value of options to purchase Class B common stock during the year ended December 31, 2021 was $13.42 per share based on the following weighted-average assumptions:


	Year Ended December 31, 2021
Expected volatility	51.4	%
Risk-free interest rate	0.8	%
Expected term (in years)	5.5
Expected dividend	—	%

2021 Employee Stock Purchase Plan

In March 2021, the Company’s 2021 Employee Stock Purchase Plan (“2021 ESPP”) became effective. Subject to any limitations contained therein, the 2021 ESPP allows eligible employees to contribute, through payroll deductions, up to 15% of their eligible compensation to purchase the Company’s Class A common stock at a discounted price per share. As of December 31, 2021, 4,000,000 shares of our Class A common stock were available for sale under the 2021 ESPP.

No offerings have been authorized to date by the administrator under the 2021 ESPP. If the administrator authorizes an offering period under the 2021 ESPP, the administrator will establish the duration of offering periods and purchase periods, including the starting and ending dates of offering periods and purchase periods, provided that no offering period may have a duration exceeding 27 months.

Incentive Unit Plan

The Company’s former parent, Cricut Holdings, authorized an Incentive Unit Compensation Plan (the “IU Plan”) that allowed for issuances of common incentive units (“CIUs”). The participation threshold of the awards granted under the IU Plan was typically equal to the fair market value of Cricut Holdings’ membership units at the date of the grant, except zero strike price incentive unit awards which have no participation threshold. Except as noted below, all awards issued under the IU Plan only had service-based conditions. Per unit amounts in the activity below are based on the value of Cricut Holdings’ units.

Equity Classified Units

The Company’s former parent, Cricut Holdings, granted CIUs to employees of the Company. These awards vested 25% annually over four years of service. The Company’s former parent also granted a performance-based incentive unit, which is discussed later. These awards are collectively referred to as equity classified incentive units. Once vested, all equity classified incentive units remained outstanding until the liquidation of Cricut Holdings or until repurchased by Cricut Holdings. Upon the liquidation of Cricut Holdings all outstanding awards were settled or modified as described above.

A summary of the equity classified incentive units activity for the year ended December 31, 2021 is as follows:


	Equity Incentive Units	Weighted- Average Participation Threshold		Aggregate Intrinsic Value
				(in thousands)
Outstanding at December 31, 2020	93,371,324	$	0.97	$	600,316
Granted	1,548,223	$	—
Exercised	—	$	—
Forfeited	(82,500)	$	1.29
Cancelled upon Corporate Reorganization	(94,837,047)	$	0.95
Outstanding at December 31, 2021	—	$	—	$	—
Vested at December 31, 2021	—	$	—	$	—

The following table summarizes the unvested equity classified incentive units activity for the year ended December 31, 2021:


	Number of Awards	Weighted- Average Grant Date Fair Value Per Unit
Unvested at December 31, 2020	37,116,025	$	0.74
Granted	1,548,223	$	9.06
Vested	(7,123,673)	$	0.40
Forfeited	(82,500)	$	0.79
Cancelled upon Corporate Reorganization	(31,458,075)	$	1.23
Unvested at December 31, 2021	—	$	—

The weighted-average grant date fair value of equity classified incentive units granted during the years ended December 31, 2021, 2020 and 2019 was $9.06, $1.27 and $0.28, respectively. The total intrinsic value of equity classified incentive units exercised during the years ended December 31, 2021, 2020 and 2019 was nil, $2.8 million and $0.3 million, respectively. The total fair value of equity classified incentive units vested during the years ended December 31, 2021, 2020 and 2019 was $3.2 million, $3.1 million and $0.4 million, respectively.

The grant date fair value of CIUs granted during the year ended December 31, 2021 was equal to the estimated fair value of Cricut Holdings’ common unit on the date of the grant as all CIUs had no participation threshold. The fair value of CIUs granted during the years ended December 31, 2020 and 2019 was estimated using the Black-Scholes option-pricing model with the following weighted-average assumptions:


	Year Ended December 31,
	2020			2019

Fair value of common unit	$	2.77		$	0.80
Expected life (in years)	3.2			3.5
Expected volatility	50.0		%	42.9		%
Risk-free rate	0.6		%	2.3		%
Expected dividend yield	—		%	—		%

During the year ended December 31, 2020, the Company issued service and market-based incentive units to an employee under the Plan. The recipient was awarded three million incentive equity units comprised of three distinct tranches each containing one million units. The first tranche was subject to service conditions wherein vesting of the award is ratable over four years. The second and third tranches were subject to the same service vesting conditions as tranche one; however, they were also subject to a market vesting condition wherein the fair value of the Cricut Holdings common units was required to exceed a determined price threshold for two consecutive board meetings or for 100 out of 120 consecutive trading days if the Company became public traded. In the absence of a public trading market, the fair value of a common unit was derived through a valuation technique allowed under ASC 718. The determined price thresholds were $6.00 and $7.00 for the second and third tranches, respectively.

In the event of a change in control, all unvested units immediately vest subject to the recipient being employed through the date of the event and any applicable price thresholds being met at the time of the change in control. In the event the recipient was terminated for cause, all incentive units, whether unvested or vested are immediately forfeited.

The incentive units represented a net profits interest and only pay out upon the occurrence of a liquidation event such as a change in control transaction. In addition, the units did not participate until the sum of distributions and capital appreciation of the common units from the date of grant of the incentive units equaled $5.00 per unit.

On the date of grant, the Company determined the fair value of this award to be $2.3 million based upon a Monte Carlo Simulation. The significant assumptions used in the Monte Carlo Simulation were as follows:


Fair value of common unit	$	2.95
Participation Threshold	$	5.00
Expected volatility		51.12	%
Risk-free rate		0.24	%
Timing of liquidity event		2 - 6 years
Fair value thresholds	$	6.00 - 7.00
Likelihood of termination		10.0	%

As described above, in connection with the Corporate Reorganization, these incentive equity units were modified to remove the market vesting condition and to increase the participation threshold to the applicable fair value threshold. The modified awards were then converted into shares of the Company’s class B common stock subject to the same service vesting conditions.

Equity Classified Options

The Company’s former parent, Cricut Holdings, granted employees of the Company options to purchase zero strike price incentive units. These options generally vested on a cliff basis upon completion of the service period specified for each award. All outstanding options of Cricut Holdings were exchanged for options to purchase class B common stock of Cricut Inc. in connection with the Corporate Reorganization. A summary of option activity for the year ended December 31, 2021 is as follows:


	Number of Options	Weighted- Average Exercise Price		Aggregate Intrinsic Value
				(in thousands)
Outstanding at December 31, 2020	1,140,000	$	4.52	$	3,283
Granted	27,027	$	7.40
Exercised	(27,027)	$	7.40	$	52
Forfeited	(84,000)	$	4.52
Cancelled upon Corporate Reorganization	(1,056,000)	$	4.52
Outstanding at December 31, 2021	—	$	—	$	—
Vested at December 31, 2021	—	$	—	$	—

The grant date fair value of options was estimated using the Black-Scholes option-pricing model with the following weighted-average assumptions for the periods indicated:


	Year Ended December 31,
	2021			2020

Fair value of common unit	$	8.99		$	6.24
Expected life (in years)	5.0			3.5
Expected volatility	50.9		%	52.5		%
Risk-free rate	0.6		%	0.3		%
Expected dividend yield	—		%	—		%

Liability Classified Incentive Unit Equivalents

The Company’s former parent issued incentive unit equivalents (phantom units) to various employees under the Incentive Unit Plan. The incentive unit equivalents paid out upon the occurrence of a liquidation event such as a change in control transaction. In addition, the units did not participate until the sum of distributions and capital appreciation of the common units from the date of grant of the incentive units equaled a specified participation threshold per unit. The incentive unit equivalents did not represent any kind of legal equity interest in the Company or

the former parent Company and required cash settlement. Accordingly, the incentive unit equivalent awards were accounted for as liability classified awards and required initial and subsequent measurement at fair value.

Initially, during the year ended December 31, 2020, these awards generally vested 12.5% annually for each of the first four years of service and 50% after the fifth year of service. Following the amendment of these awards in January 2020, these awards vested 25% annually over four years of service. All liability classified incentive units had indefinite contract terms and, once vested, remained outstanding until liquidation of Cricut Holdings or until repurchased by Cricut Holdings. Upon the liquidation of Cricut Holdings all outstanding awards were settled or modified as described above.

A summary of the liability classified incentive unit equivalents activity for the year ended December 31, 2021 is as follows:


	Liability Incentive Equivalents	Weighted- Average Participation Threshold		Aggregate Intrinsic Value
				(in thousands)
Outstanding at December 31, 2020	2,851,516	$	2.13	$	15,017
Granted	320,000
Forfeited	(4,000)
Cancelled upon Corporate Reorganization	(3,167,516)	$	1.92
Outstanding at December 31, 2021	—	$	—	$	—
Exercisable at December 31, 2021	—	$	—	$	—
Vested and expected to vest at December 31, 2021	—	$	—	$	—

The following table summarizes the unvested liability classified incentive unit equivalents activity for the year ended December 31, 2021:


	Number of Awards	Weighted- Average Grant Date Fair Value Per Unit
Unvested at December 31, 2020	2,851,516	$	1.74
Granted	320,000	$	8.19
Forfeited	(4,000)	$	6.58
Cancelled upon Corporate Reorganization	(3,167,516)	$	2.39
Unvested at December 31, 2021	—	$	—

The weighted-average grant date fair value of liability classified incentive units granted during the years ended December 31, 2021, 2020 and 2019 was $8.19, $2.01 and $1.01, respectively

The Company estimated the fair value of liability classified incentive units at each reporting period using the Monte Carlo Simulation. The significant assumptions used in the Monte Carlo Simulation for the periods indicated were as follows:


	Year Ended December 31,
	2020			2019

Fair value of common units	$	7.40		$	1.85
Expected life (in years)	0.3 - 5 years			3 - 5 years
Expected Volatility	51.1		%	40.2		%
Risk-free rate	0.2		%	1.6		%
Expected dividend yield	—		%	—		%
Likelihood of termination	10.0		%	10.0		%

For the year end December 31, 2021, the Company estimated the fair value of liability classified incentive unit equivalents upon the modification or settlement as part of the Corporate Reorganization based on the estimated fair value of the awards received to settle the liability. The cumulative adjustment upon settlement or modification is included in stock-based compensation related to liability awards above.

Liability classified incentive unit equivalents were included in accrued expenses and other current liabilities per the Company’s consolidated balance sheets and the rollforward of this liability is as follows (in thousands):


(in thousands)
Balance at December 31, 2018	$	25
Stock-based compensation during year	305
Purchased unit equivalents during year	30
Balance at December 31, 2019	$	360
Stock-based compensation during year	5,161
Purchased unit equivalents during year	181
Balance at December 31, 2020	$	5,702
Stock-based compensation during period	6,041
Settlement or modification of awards	(11,743)
Balance at December 31, 2021	$	—

Inventories (Tables)

12 Months Ended

Dec. 31, 2021

Inventory Disclosure [Abstract]

Schedule of components of inventories

Inventories of finished goods are comprised of the following:


	December 31,
	2021		2020
(in thousands)
Raw Materials	$	20,187	$	714
Finished goods	433,987		248,031
Total Inventories	$	454,174	$	248,745

Intangible Assets, Net

12 Months Ended

Dec. 31, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible Assets, Net

The following is a summary of the Company’s intangible assets in the consolidated balance sheets:


	December 31, 2021
	Gross Carrying Amount		Accumulated Amortization and Impairment		Net
(in thousands)
Trade names and trademarks	$	42,301	$	(40,781)	$	1,520
Total intangible asset	$	42,301	$	(40,781)	$	1,520


	December 31, 2020
	Gross Carrying Amount		Accumulated Amortization and Impairment		Net
(in thousands)
Trade names and trademarks	$	42,301	$	(40,021)	$	2,280
Total intangible asset	$	42,301	$	(40,021)	$	2,280

The Company’s trade names and trademarks have useful lives ranging from 11 to 15 years. Amortization is expensed on a straight-line basis for all intangible assets, as this is the Company’s best estimate of the period of economic benefit to be received.

The Company performed an evaluation of its intangible assets and determined there was an impairment of $0.7 million during the years ended December 31, 2019, associated with a product trade name which is no longer in use. These impairment charges were recognized within sales and marketing expense on the Company’s consolidated statements of operations. Amortization expense of intangible assets totaled $0.8 million for each of the years ended December 31, 2021, 2020 and 2019, respectively.

As of December 31, 2021, estimated future amortization of intangible assets is as follows:


	Amount
(in thousands)
2022	$	760
2023	760
Total	$	1,520

Accrued Expenses and Other Current Liabilities

12 Months Ended

Dec. 31, 2021

Payables and Accruals [Abstract]

Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities consist of the following:


	December 31,
	2021		2020
(in thousands)
Sales incentives and rebates	$	36,969	$	30,295
Other accrued liabilities and other current liabilities	32,382		41,029
Total accrued expenses	$	69,351	$	71,324

Stock-Based Compensation - Summary of Unvested Equity Classified Incentive Units (Details) - Equity Classified Incentive Units - $ / shares	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Number of Shares
Beginning balance (in shares)	37,116,025
Granted (in shares)	1,548,223
Vested (in shares)	(7,123,673)
Forfeited (in shares)	(82,500)
Cancelled (in shares)	(31,458,075)
Ending balance (in shares)	0	37,116,025
Weighted- Average Grant Date Fair Value (per share)
Beginning balance (in dollars per share)	$ 0.74
Granted (in dollars per share)	9.06	$ 1.27	$ 0.28
Vested (in dollars per share)	0.40
Forfeited (in dollars per share)	0.79
Cancelled (in dollars per share)	1.23
Ending balance (in dollars per share)	$ 0	$ 0.74

Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Current assets:
Cash and cash equivalents	$ 241,597	$ 122,215
Accounts receivable, net	199,508	162,931
Inventories	454,174	248,745
Prepaid expenses and other current assets	32,820	4,916
Total current assets	928,099	538,807
Property and equipment, net	53,261	33,441
Operating lease right-of-use assets	17,653	0
Intangible assets, net	1,520	2,280
Deferred tax assets	3,255	3,119
Other assets	2,462	3,753
Total assets	1,006,250	581,400
Current liabilities:
Accounts payable	204,714	251,658
Accrued expenses and other current liabilities	69,351	71,324
Deferred revenue, current portion	30,547	23,518
Operating lease liabilities, current portion	3,755	0
Total current liabilities	308,367	346,500
Operating lease liabilities, net of current portion	15,780	0
Deferred revenue, net of current portion	4,858	2,758
Other non-current liabilities	3,269	3,217
Total liabilities	332,274	352,475
Commitments and contingencies (Note 12)
Stockholders’ equity:
Preferred stock, par value $0.001 per share, 100,000,000 shares authorized, no shares issued and outstanding as of December 31, 2021. No shares issued, authorized or outstanding as of December 31, 2020.	0	0
Common stock, par value $0.001 per share, 1,250,000,000 shares authorized as of December 31, 2021, 221,913,559 shares issued and outstanding as of December 31, 2021; 257,058,262 shares authorized as of December 31, 2020, 208,116,104 shares issued and outstanding as of December 31, 2020.	222	208
Additional paid-in capital	717,369	412,741
Accumulated deficit	(43,560)	(184,033)
Accumulated other comprehensive income (loss)	(55)	9
Total stockholders’ equity	673,976	228,925
Total liabilities and stockholders’ equity	$ 1,006,250	$ 581,400

Stock-Based Compensation - Summary of Equity Classified Options (Details) - Equity Classified Options $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2021 USD ($) $ / shares shares
Number of Options
Beginning balance (in shares) \| shares	1,140,000
Granted (in shares) \| shares	27,027
Exercised (in shares) \| shares	(27,027)
Forfeited (in shares) \| shares	(84,000)
Cancelled (in shares) \| shares	(1,056,000)
Ending balance (in shares) \| shares	0
Vested (in shares) \| shares	0
Weighted- Average Exercise Price
Beginning weighted average exercise price (in dollars per share) \| $ / shares	$ 4.52
Granted (in dollars per share) \| $ / shares	7.40
Exercised (in dollars per share) \| $ / shares	7.40
Forfeited (in dollars per share) \| $ / shares	4.52
Cancelled (in dollars per share) \| $ / shares	4.52
Ending weighted average exercise price (in dollars per share) \| $ / shares	0
Vested (in dollars per share) \| $ / shares	$ 0
Weighted- Average Remaining Term (Years)
Beginning aggregate intrinsic value \| $	$ 3,283
Exercised aggregate intrinsic value \| $	52
Ending aggregate intrinsic value \| $	0
Vested aggregate intrinsic value \| $	$ 0

Intangible Assets, Net - Summary of Intangible Assets, Net (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	$ 42,301	$ 42,301
Accumulated Amortization and Impairment	(40,781)	(40,021)
Net	1,520	2,280
Trade names and trademarks
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	42,301	42,301
Accumulated Amortization and Impairment	(40,781)	(40,021)
Net	$ 1,520	$ 2,280

Intangible Assets, Net - Schedule of Estimated Future Amortization of Intangible Assets (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Goodwill and Intangible Assets Disclosure [Abstract]
2022	$ 760
2023	760
Net	$ 1,520	$ 2,280

Income Taxes - Components of Income Tax Expense (Benefit) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Current:
Federal	$ 44,093	$ 41,900	$ 11,070
State	7,780	5,132	1,244
Foreign	162	(125)	0
Total current	52,035	46,907	12,314
Deferred:
Federal	(23)	(2,492)	(1,535)
State	(137)	200	278
Foreign	25	0	0
Total deferred	(135)	(2,292)	(1,257)
Income tax provision	$ 51,900	$ 44,615	$ 11,057

Stock-Based Compensation - Cost Related to Company's Stock-Based Compensation Plan (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense	$ 38,074	$ 9,484	$ 1,845
Total stock-based compensation	42,202	10,117	1,930
Software Development
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Share-based compensation expense, amount capitalized	1,607	253	85
Inventories
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Share-based compensation expense, amount capitalized	2,521	380	0
Total cost of revenue
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense	253	38	13
Connected machines
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense	34	7	2
Subscriptions
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense	219	31	11
Accessories and materials
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense	0	0	0
Research and development
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense	15,782	3,332	881
Sales and marketing
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense	13,814	4,794	623
General and administrative
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense	$ 8,225	$ 1,320	$ 328

Consolidated Balance Sheets (Parenthetical) - $ / shares	Dec. 31, 2021	Dec. 31, 2020
Statement of Financial Position [Abstract]
Preferred stock, par value (in dollars per share)	$ 0.001
Preferred stock, shares authorized (in shares)	100,000,000	0
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.001
Common stock, shares authorized (in shares)	1,250,000,000	257,058,262
Common stock, shares issued (in shares)	221,913,559	208,116,104
Common stock, shares outstanding (in shares)	221,913,559	208,116,104

Stock-Based Compensation - Options to Purchase Class B Common Stock (Details) - Common Class B $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2021 USD ($) $ / shares shares
Number of Options
Beginning balance (in shares) \| shares	0
Granted (in shares) \| shares	522,000
Forfeited / cancelled (in shares) \| shares	(88,000)
Ending balance (in shares) \| shares	434,000
Vested (in shares) \| shares	0
Weighted- Average Exercise Price
Beginning weighted average exercise price (in dollars per share) \| $ / shares
Granted (in dollars per share) \| $ / shares	9.04
Forfeited / Cancelled (in dollars per share) \| $ / shares	9.04
Ending weighted average exercise price (in dollars per share) \| $ / shares	9.04
Vested (in dollars per share) \| $ / shares	$ 0
Weighted- Average Remaining Term (Years)
Weighted average remaining terms (years)	3 years 10 months 24 days
Aggregate Intrinsic Value
Beginning aggregate intrinsic value \| $
Ending aggregate intrinsic value \| $	5,664
Vested aggregate intrinsic value \| $	$ 0

Consolidated Statements of Operations and Comprehensive Income - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Revenue:
Revenue	$ 1,306,227	$ 959,030	$ 486,554
Cost of revenue:
Cost of revenue	848,777	626,656	344,204
Gross profit	457,450	332,374	142,350
Operating expenses:
Research and development	79,814	38,930	26,674
Sales and marketing	133,963	63,329	40,110
General and administrative	51,268	29,602	22,005
Total operating expenses	265,045	131,861	88,789
Income from operations	192,405	200,513	53,561
Total other expense, net	(32)	(1,320)	(3,293)
Income before provision for income taxes	192,373	199,193	50,268
Provision for income taxes	51,900	44,615	11,057
Net income	140,473	154,578	39,211
Other comprehensive income (loss):
Change in foreign currency translation adjustment, net of tax	(64)	37	(28)
Comprehensive income	$ 140,409	$ 154,615	$ 39,183
Earnings per share, basic (in dollars per share)	$ 0.67	$ 0.74	$ 0.19
Earnings per share, diluted (in dollars per share)	$ 0.64	$ 0.74	$ 0.19
Weighted-average common shares outstanding, basic (in shares)	208,833,827	208,116,104	208,116,104
Weighted-average common shares outstanding, diluted (in shares)	219,776,069	208,116,104	208,116,104
Connected machines
Revenue:
Revenue	$ 548,205	$ 416,714	$ 198,144
Cost of revenue:
Cost of revenue	484,025	351,898	176,894
Subscriptions
Revenue:
Revenue	205,858	111,337	53,829
Cost of revenue:
Cost of revenue	21,961	13,125	8,827
Accessories and materials
Revenue:
Revenue	552,164	430,979	234,581
Cost of revenue:
Cost of revenue	$ 342,791	$ 261,633	$ 158,483

Commitment and Contingencies	12 Months Ended
Commitment and Contingencies	Dec. 31, 2021
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies Litigation The Company is subject to certain outside claims and litigation arising in the ordinary course of business. Management is not aware of any contingencies which it believes will have a material effect on its financial position, results of operations or liquidity.

Summary of Significant Accounting Policies - Schedule of Sale Refund Liability (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Movement In Contract With Customer, Refund Liability [Roll Forward]
Balance at beginning of period	$ 3,515	$ 941
Additions that reduced net revenue	15,889	8,664
Deductions from reserves for current year returns	(11,578)	(6,090)
Balance at end of period	$ 7,826	$ 3,515

Related Party Transactions	12 Months Ended
Related Party Transactions	Dec. 31, 2021
Related Party Transactions [Abstract]
Related Party Transactions	Related Party Transactions For the years ended December 31, 2021, 2020 and 2019 the Company received $0.2 million, $2.5 million and $1.3 million, respectively, of capital contributions from Cricut Holdings, as a result of additional common units issued by Cricut Holdings at the estimated fair value of the underlying units. The equity offering was purchased by a subset of then current common unit holders of Cricut Holdings and employees of the Company.

Stock-Based Compensation (Tables)

12 Months Ended

Dec. 31, 2021

Share-based Payment Arrangement [Abstract]

Schedule of Stock-Based Compensation Costs

The following table shows the stock-based compensation cost by award type for the periods indicated:


	Year Ended December 31,
	2021		2020		2019
(in thousands)
Equity-classified awards	$	35,755	$	4,956	$	1,625
Liability-classified awards	6,447		5,161		305
Total stock-based compensation	$	42,202	$	10,117	$	1,930


	Year Ended December 31,
	2021		2020		2019
(in thousands)
Cost of revenue
Connected machines	$	34	$	7	$	2
Subscriptions	219		31		11
Accessories and materials	—		—		—
Total cost of revenue	253		38		13
Research and development	15,782		3,332		881
Sales and marketing	13,814		4,794		623
General and administrative	8,225		1,320		328
Total stock-based compensation expense	$	38,074	$	9,484	$	1,845
Capitalized for software development costs	$	1,607	$	253	$	85
Capitalized to inventory	$	2,521	$	380	$	—
Total stock-based compensation	$	42,202	$	10,117	$	1,930

Schedule of Restricted Stock Unit Activity

A summary of the Company’s RSU activity under the 2021 Equity Incentive Plan is as follows:


	Number of RSUs	Weighted- Average Grant Date Fair Value (per share)
Outstanding at December 31, 2020	—	$	—
Granted	5,021,833	$	23.69
Vested	(224,752)	$	20.00
Forfeited/cancelled	(123,250)	$	24.68
Outstanding at December 31, 2021	4,673,831	$	23.84

A summary of the RSU equivalent activity under the 2021 Equity Incentive Plan is as follows:


	Number of RSU Equivalents	Weighted- Average Base Price		Aggregate Intrinsic Value
				(in thousands)
Outstanding at December 31, 2020	—
Granted	94,304	20.00
Vested	(13,227)	$	20.00	$	436
Outstanding at December 31, 2021	81,077	$	20.00	$	1,231

Schedule of Stock Option Activity

A summary of the Company’s stock option activity under the 2021 Equity Incentive Plan is as follows:


	Number of Options	Weighted- Average Exercise Price		Weighted- Average Remaining Term (Years)	Aggregate Intrinsic Value
					(in thousands)
Outstanding at December 31, 2020	—	$	—
Granted	3,419,359	20.00
Exercised	(13,592)	20.00
Forfeited/cancelled	(145,410)	20.00
Outstanding at December 31, 2021	3,260,357	$	20.00	5.8	$	6,814
Vested and exercisable at December 31, 2021	1,379,702	$	20.00	5.1	$	2,884


	Number of Options	Weighted- Average Exercise Price		Weighted- Average Remaining Term (Years)	Aggregate Intrinsic Value
					(in thousands)
Outstanding at December 31, 2020	—
Granted	522,000	$	9.04
Forfeited / Cancelled	(88,000)	$	9.04
Outstanding at December 31, 2021	434,000	$	9.04	3.9	$	5,664
Vested at December 31, 2021	—	$	—	N/A	$	—

A summary of option activity for the year ended December 31, 2021 is as follows:


	Number of Options	Weighted- Average Exercise Price		Aggregate Intrinsic Value
				(in thousands)
Outstanding at December 31, 2020	1,140,000	$	4.52	$	3,283
Granted	27,027	$	7.40
Exercised	(27,027)	$	7.40	$	52
Forfeited	(84,000)	$	4.52
Cancelled upon Corporate Reorganization	(1,056,000)	$	4.52
Outstanding at December 31, 2021	—	$	—	$	—
Vested at December 31, 2021	—	$	—	$	—

Schedule of Weighted-Average Valuation Assumptions

The weighted-average grant date fair value of options granted under the 2021 Equity Incentive Plan during the year ended December 31, 2021 was $8.79 per share based on the following weighted-average assumptions:


	Year Ended December 31, 2021
Expected volatility	51.6	%
Risk-free interest rate	0.8	%
Expected term (in years)	4.9
Expected dividend	—	%


	Year Ended December 31, 2021
Expected volatility	51.4	%
Risk-free interest rate	0.8	%
Expected term (in years)	5.5
Expected dividend	—	%

The grant date fair value of options was estimated using the Black-Scholes option-pricing model with the following weighted-average assumptions for the periods indicated:


	Year Ended December 31,
	2021			2020

Fair value of common unit	$	8.99		$	6.24
Expected life (in years)	5.0			3.5
Expected volatility	50.9		%	52.5		%
Risk-free rate	0.6		%	0.3		%
Expected dividend yield	—		%	—		%

Schedule of Weighted-Average Valuation Assumptions


	Year Ended December 31, 2021
Expected volatility	80.5	%
Risk-free interest rate	0.4	%
Expected term (in years)	1.0
Expected dividend	—	%

The fair value of CIUs granted during the years ended December 31, 2020 and 2019 was estimated using the Black-Scholes option-pricing model with the following weighted-average assumptions:


	Year Ended December 31,
	2020			2019

Fair value of common unit	$	2.77		$	0.80
Expected life (in years)	3.2			3.5
Expected volatility	50.0		%	42.9		%
Risk-free rate	0.6		%	2.3		%
Expected dividend yield	—		%	—		%

The significant assumptions used in the Monte Carlo Simulation were as follows:


Fair value of common unit	$	2.95
Participation Threshold	$	5.00
Expected volatility		51.12	%
Risk-free rate		0.24	%
Timing of liquidity event		2 - 6 years
Fair value thresholds	$	6.00 - 7.00
Likelihood of termination		10.0	%

The significant assumptions used in the Monte Carlo Simulation for the periods indicated were as follows:


	Year Ended December 31,
	2020			2019

Fair value of common units	$	7.40		$	1.85
Expected life (in years)	0.3 - 5 years			3 - 5 years
Expected Volatility	51.1		%	40.2		%
Risk-free rate	0.2		%	1.6		%
Expected dividend yield	—		%	—		%
Likelihood of termination	10.0		%	10.0		%

Schedule of Nonvested Share Activity


	Number of Unvested Shares	Weighted- Average Grant Date Fair Value (per share)
Outstanding at December 31, 2020	—
Granted	14,037,505	$	20.00
Vested	(2,643,782)	$	20.00
Forfeited / Cancelled	(538,864)	$	20.00
Outstanding at December 31, 2021	10,854,859	$	20.00

The following table summarizes the unvested equity classified incentive units activity for the year ended December 31, 2021:


	Number of Awards	Weighted- Average Grant Date Fair Value Per Unit
Unvested at December 31, 2020	37,116,025	$	0.74
Granted	1,548,223	$	9.06
Vested	(7,123,673)	$	0.40
Forfeited	(82,500)	$	0.79
Cancelled upon Corporate Reorganization	(31,458,075)	$	1.23
Unvested at December 31, 2021	—	$	—

Schedule of Equity Classified Incentive Units, Activity

A summary of the equity classified incentive units activity for the year ended December 31, 2021 is as follows:


	Equity Incentive Units	Weighted- Average Participation Threshold		Aggregate Intrinsic Value
				(in thousands)
Outstanding at December 31, 2020	93,371,324	$	0.97	$	600,316
Granted	1,548,223	$	—
Exercised	—	$	—
Forfeited	(82,500)	$	1.29
Cancelled upon Corporate Reorganization	(94,837,047)	$	0.95
Outstanding at December 31, 2021	—	$	—	$	—
Vested at December 31, 2021	—	$	—	$	—

Schedule of Liability Classified Incentive Units, Activity

A summary of the liability classified incentive unit equivalents activity for the year ended December 31, 2021 is as follows:


	Liability Incentive Equivalents	Weighted- Average Participation Threshold		Aggregate Intrinsic Value
				(in thousands)
Outstanding at December 31, 2020	2,851,516	$	2.13	$	15,017
Granted	320,000
Forfeited	(4,000)
Cancelled upon Corporate Reorganization	(3,167,516)	$	1.92
Outstanding at December 31, 2021	—	$	—	$	—
Exercisable at December 31, 2021	—	$	—	$	—
Vested and expected to vest at December 31, 2021	—	$	—	$	—

Schedule of Nonvested Liability Classified Incentive Units, Activity

The following table summarizes the unvested liability classified incentive unit equivalents activity for the year ended December 31, 2021:


	Number of Awards	Weighted- Average Grant Date Fair Value Per Unit
Unvested at December 31, 2020	2,851,516	$	1.74
Granted	320,000	$	8.19
Forfeited	(4,000)	$	6.58
Cancelled upon Corporate Reorganization	(3,167,516)	$	2.39
Unvested at December 31, 2021	—	$	—

Schedule of Expensed Liability Classified Inventive Units Activity


(in thousands)
Balance at December 31, 2018	$	25
Stock-based compensation during year	305
Purchased unit equivalents during year	30
Balance at December 31, 2019	$	360
Stock-based compensation during year	5,161
Purchased unit equivalents during year	181
Balance at December 31, 2020	$	5,702
Stock-based compensation during period	6,041
Settlement or modification of awards	(11,743)
Balance at December 31, 2021	$	—

Summary of Significant Accounting Policies - Schedule Customer of Concentration (Details)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Product Concentration Risk \| Cost of Goods and Service, Product and Service Benchmark \| Top Two Vendors
Concentration Risk [Line Items]
Concentration risk, percentage	76.00%	73.00%
Product Concentration Risk \| Cost of Goods and Service, Product and Service Benchmark \| Top Three Vendors
Concentration Risk [Line Items]
Concentration risk, percentage			84.00%
Customer A \| Customer Concentration Risk \| Accounts Receivable
Concentration Risk [Line Items]
Concentration risk, percentage	23.00%	21.00%
Customer A \| Customer Concentration Risk \| Revenue Benchmark
Concentration Risk [Line Items]
Concentration risk, percentage	11.00%		12.00%
Customer B \| Customer Concentration Risk \| Accounts Receivable
Concentration Risk [Line Items]
Concentration risk, percentage		16.00%
Customer B \| Customer Concentration Risk \| Revenue Benchmark
Concentration Risk [Line Items]
Concentration risk, percentage		11.00%	11.00%
Customer C \| Customer Concentration Risk \| Accounts Receivable
Concentration Risk [Line Items]
Concentration risk, percentage	12.00%	22.00%
Customer C \| Customer Concentration Risk \| Revenue Benchmark
Concentration Risk [Line Items]
Concentration risk, percentage	10.00%	14.00%
Customer D \| Customer Concentration Risk \| Accounts Receivable
Concentration Risk [Line Items]
Concentration risk, percentage		10.00%
Customer D \| Customer Concentration Risk \| Revenue Benchmark
Concentration Risk [Line Items]
Concentration risk, percentage	14.00%	14.00%	21.00%

Stock-Based Compensation - Unvested Class B Common Stock Activity (Details) - Common Class B	12 Months Ended
	Dec. 31, 2021 $ / shares shares
Number of Shares
Beginning balance (in shares) \| shares	0
Granted (in shares) \| shares	14,037,505
Vested (in shares) \| shares	(2,643,782)
Forfeited / cancelled (in shares) \| shares	(538,864)
Ending balance (in shares) \| shares	10,854,859
Weighted- Average Grant Date Fair Value (per share)
Beginning balance (in dollars per share) \| $ / shares
Granted (in dollars per share) \| $ / shares	20.00
Vested (in dollars per share) \| $ / shares	20.00
Forfeited / cancelled (in dollars per share) \| $ / shares	20.00
Ending balance (in dollars per share) \| $ / shares	$ 20.00

Stock-Based Compensation - Summary of Unvested Liability Classified Incentive Units (Details) - Liability Classified Incentive Unit Equivalents - $ / shares	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Number of Shares
Beginning balance (in shares)	2,851,516
Granted (in shares)	320,000
Forfeited (in shares)	(4,000)
Cancelled (in shares)	(3,167,516)
Ending balance (in shares)	0	2,851,516
Weighted- Average Grant Date Fair Value (per share)
Beginning balance (in dollars per share)	$ 1.74
Granted (in dollars per share)	8.19	$ 2.01	$ 1.01
Forfeited (in dollars per share)	6.58
Cancelled (in dollars per share)	2.39
Ending balance (in dollars per share)	$ 0	$ 1.74

Summary of Significant Accounting Policies - Schedule of Product Warranty Reserves (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Movement in Standard Product Warranty Accrual [Roll Forward]
Warranty reserve, beginning of period	$ 1,284	$ 633
Additions charged to cost of revenue	7,261	2,683
Repairs and replacements	(6,147)	(2,032)
Warranty reserve, end of period	$ 2,398	$ 1,284

Stock-Based Compensation - Summary of Outstanding Equity Classified Incentive Units (Details) - Equity Classified Incentive Units $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2021 USD ($) $ / shares shares
Number of Shares
Beginning balance (in shares) \| shares	93,371,324
Granted (in shares) \| shares	1,548,223
Exercised (in shares) \| shares	0
Forfeited (in shares) \| shares	(82,500)
Cancelled (in shares) \| shares	(94,837,047)
Ending balance (in shares) \| shares	0
Vested (in shares) \| shares	0
Weighted- Average Participation Threshold
Beginning weighted average participation threshold (in dollars per share) \| $ / shares	$ 0.97
Granted (in dollars per share) \| $ / shares	0
Exercised (in dollars per share) \| $ / shares	0
Forfeited (in dollars per share) \| $ / shares	1.29
Cancelled (in dollars per share) \| $ / shares	0.95
Ending weighted average participation threshold (in dollars per share) \| $ / shares	0
Vested (in dollars per share) \| $ / shares	$ 0
Aggregate Intrinsic Value
Beginning aggregate intrinsic value \| $	$ 600,316
Ending aggregate intrinsic value \| $	0
Vested aggregate intrinsic value \| $	$ 0

Revenue and Deferred Revenue - Schedule of Total Revenue by Geography (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Disaggregation of Revenue [Line Items]
Revenue	$ 1,306,227	$ 959,030	$ 486,554
North America
Disaggregation of Revenue [Line Items]
Revenue	1,157,679	888,266	469,110
International
Disaggregation of Revenue [Line Items]
Revenue	$ 148,548	$ 70,764	$ 17,444

- Definition

+ References

+ Details

Employee Benefit Plan	12 Months Ended
Employee Benefit Plan	Dec. 31, 2021
Retirement Benefits [Abstract]
Employee Benefit Plan	Employee Benefit PlanThe Company sponsors a 401(k) plan for the benefit of its employees who have attained at least 18 Years of age. The Company matches 50% of the first 12% of an employee’s salary contributed to the plan on the first day of the month following their hire date. The Company contributed $2.4 million and $1.1 million years ended December 31, 2021 and 2020, respectively.

Revolving Credit Facility - Narrative (Details) - Revolving Credit Facility - Credit Agreement	12 Months Ended
	Dec. 31, 2021 USD ($)	Sep. 30, 2020 USD ($)
Line of Credit Facility [Line Items]
Revolving credit facility expiration period		3 years
Maximum borrowing capacity		$ 150,000,000
Additional borrowing capacity, increase limit		200,000,000
Additional borrowing capacity, higher borrowing capacity option		$ 350,000,000
Amounts outstanding	$ 0
Remaining borrowing capacity	$ 150,000,000
Restrictive covenants, fixed charge coverage ratio	1.0
Restrictive covenants, fixed charge coverage ratio, calculation period	12 months
Restrictive covenants in future periods if available commitments are less than, amount	$ 15,000,000
Restrictive covenants in future period if available commitments are less than percent (in percentage)	0.10
Minimum \| Alternative Base Rate
Line of Credit Facility [Line Items]
Basis spread on variable rate (percentage)	1.50%
Minimum \| REVLIBOR30 Screen Rate
Line of Credit Facility [Line Items]
Basis spread on variable rate (percentage)	1.50%
Minimum \| Rate Based on Fixed Charge Coverage Ratio
Line of Credit Facility [Line Items]
Basis spread on variable rate (percentage)	0.00%
Maximum \| Alternative Base Rate
Line of Credit Facility [Line Items]
Basis spread on variable rate (percentage)	2.00%
Maximum \| REVLIBOR30 Screen Rate
Line of Credit Facility [Line Items]
Basis spread on variable rate (percentage)	2.00%
Maximum \| Rate Based on Fixed Charge Coverage Ratio
Line of Credit Facility [Line Items]
Basis spread on variable rate (percentage)	0.50%

Net Income Per Share

12 Months Ended

Dec. 31, 2021

Earnings Per Share [Abstract]

Net Income Per Share

The computation of net income per share is as follows:


	Year Ended December 31,
	2021		2020		2019
(in thousands, except share and per share amounts)
Basic earnings per share:
Net income	$	140,473	$	154,578	$	39,211
Shares used in computation:
Weighted-average common shares outstanding, basic	208,833,827		208,116,104		208,116,104
Earnings per share, basic	$	0.67	$	0.74	$	0.19

Diluted earnings per share:
Net income	$	140,473	$	154,578	$	39,211
Shares used in computation:
Weighted-average common shares outstanding, basic	208,833,827		208,116,104		208,116,104
Weighted-average effect of potentially dilutive securities:
Unvested common stock subject to forfeiture	9,132,579		—		—
Employee stock options	717,772		—		—
Restricted stock units	1,073,093		—		—
Underwriters’ option to purchase additional shares	18,798		—		—
Diluted weighted-average common shares outstanding	219,776,069		208,116,104		208,116,104
Diluted earnings per share	$	0.64	$	0.74	$	0.19

The following potentially dilutive shares were excluded from the computation of diluted earnings per share for the periods presented because including them would have had an anti-dilutive effect:


	Year Ended December 31,
	2021	2020	2019


Restricted stock units	786,500	—	—

Revenue and Deferred Revenue - Schedule of Changes in the Deferred Revenue Balance (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Movement in Deferred Revenue [Roll Forward]
Deferred revenue, beginning of period	$ 26,276	$ 14,566
Recognition of revenue included in beginning of period deferred revenue	(23,518)	(13,188)
Revenue deferred, net of revenue recognized on contracts in the respective period	32,647	24,898
Deferred revenue, end of period	$ 35,405	$ 26,276

Income Taxes

12 Months Ended

Dec. 31, 2021

Income Tax Disclosure [Abstract]

Income Taxes

The Company’s income before income taxes of $192.4 million, $199.2 million, and $50.3 million during the years ended December 31, 2021, 2020, and 2019, respectively, consisted of $191.5 million, $199.7 million, and $50.2 million of income earned in the United States. The remaining amount was earned in foreign jurisdictions.

The reconciliation of income tax computed at the U.S. federal statutory tax rate to our effective income tax rate is as follows:


	Year Ended December 31,
	2021		2020		2019

Income tax provision at statutory rate	21.0	%	21.0	%	21.0	%
State taxes, net	4.7		2.2		2.4
Stock-based compensation	2.1		0.8		0.7
Foreign derived intangible income deduction	(1.4)		(0.7)		—
Tax credits	(2.9)		(1.1)		(2.8)
Return to provision adjustments	2.3		(0.1)		0.3
Other	1.2		0.3		0.4
Total provision for income taxes	27.0	%	22.4	%	22.0	%

Differences between the Company’s effective tax rate and the statutory tax rate relate primarily to state income taxes, stock-based compensation, tax credits and changes in unrecognized tax benefits during the period.Deferred taxes reflect the net tax effects of the temporary differences between the carrying amount of assets and liabilities for financial reporting and the amount used for income tax purposes. Significant components of the Company’s net deferred tax assets are comprised of the following:


	December 31,
	2021		2020
(in thousands)
Deferred tax assets:
Inventories	$	3,387	$	4,092
Deferred rent	—		370
Lease liability	5,068		—
Accounts receivable	372		83
Sales refund liability	2,002		816
Deferred revenue	1,243		640
Stock-based compensation	4,668		394
Amortization	149		182
Net operating loss carryforwards	146		171
Tax credits	1,003		1,064
Other	853		1,449
Total deferred tax assets	18,891		9,261
Deferred tax liabilities:
Depreciation and amortization	(11,215)		(6,142)
ROU lease asset	(4,421)		—
Total deferred tax liabilities	(15,636)		(6,142)
Net deferred tax assets	$	3,255	$	3,119


	Year Ended December 31,
	2021		2020		2019
(in thousands)
Current:
Federal	$	44,093	$	41,900	$	11,070
State	7,780		5,132		1,244
Foreign	162		(125)		—
Total current	52,035		46,907		12,314
Deferred:
Federal	(23)		(2,492)		(1,535)
State	(137)		200		278
Foreign	25		—		—
Total deferred	(135)		(2,292)		(1,257)
Income tax provision	$	51,900	$	44,615	$	11,057

There are immaterial foreign net operating loss carryforwards set to expire in 2025. The Company establishes valuation allowances if it is more likely than not that deferred tax assets will not be realized. We believe that we will generate sufficient future taxable income to realize the net operating loss deferred tax asset and other net deferred tax assets recorded in our consolidated financial statements. Accordingly, the Company has not recorded a valuation allowance against net deferred tax assets for the years ended December 31, 2021 and 2020.

As of December 31, 2021, 2020, and 2019, $2.8 million, $1.4 million and $1.8 million, respectively, of unrecognized tax benefits would affect our effective tax rate if recognized. The total balance of unrecognized gross tax benefits for the years ended December 31, 2021 and 2020, resulting primarily from research and development credits, fixed asset and inventory basis differences were as follows:


	Year Ended December 31,
	2021		2020
(in thousands)
Unrecognized tax benefits at beginning of year	$	3,318	$	3,989
Reductions based on prior year tax positions	—		(1,481)
Additions based on prior year tax provisions	593		132
Additions based on current year tax provisions	1,431		678
Reductions due to tax authorities’ settlements	(2,824)		—
Reductions due to expirations of statutes of limitation	(139)		—
Unrecognized tax benefits at end of year	$	2,379	$	3,318

The Company’s practice is to recognize interest and/or penalties related to income tax matters in income tax expense. For the years ended December 31, 2021 and 2020, interest or penalties related to income tax matters included in the provision for income taxes have not been material.

In January 2021, the IRS completed its examination of the Company’s 2017 tax year. No material adjustments resulted from this examination. The Company is subject to U.S. federal and state income tax examination for tax years 2016 and forward.

- 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
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 21
-URI http://asc.fasb.org/extlink&oid=121826272&loc=d3e32857-109319

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section S99
-Paragraph 2
-Subparagraph (SAB Topic 11.C)
-URI http://asc.fasb.org/extlink&oid=122134291&loc=d3e330215-122817

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 17
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=121826272&loc=d3e32809-109319

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SAB TOPIC 6.I.5.Q1)
-URI http://asc.fasb.org/extlink&oid=122134291&loc=d3e330036-122817

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 14
-URI http://asc.fasb.org/extlink&oid=121826272&loc=d3e32705-109319

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 270
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-URI http://asc.fasb.org/topic&trid=2144680

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 30
-Section 50
-Paragraph 2
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(h)(2))
-URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

+ Details

Summary of Significant Accounting Policies - Narrative (Details) - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Foreign currency transaction gains (losses)	$ (900,000)	$ (300,000)	$ 200,000
Impairment of intangible assets	0	0	700,000
Impairment of long-lived property and equipment	0	0	0
Money market funds, at carrying value	$ 197,800,000	106,000,000
Expected dividend	0.00%
Advertising expense	$ 45,100,000	15,500,000	$ 4,200,000
Capitalized costs	$ 1,400,000
Other Assets
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Deferred offering costs		$ 1,900,000

Intangible Assets, Net (Tables)

12 Months Ended

Dec. 31, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

Summary of intangible assets

The following is a summary of the Company’s intangible assets in the consolidated balance sheets:


	December 31, 2021
	Gross Carrying Amount		Accumulated Amortization and Impairment		Net
(in thousands)
Trade names and trademarks	$	42,301	$	(40,781)	$	1,520
Total intangible asset	$	42,301	$	(40,781)	$	1,520


	December 31, 2020
	Gross Carrying Amount		Accumulated Amortization and Impairment		Net
(in thousands)
Trade names and trademarks	$	42,301	$	(40,021)	$	2,280
Total intangible asset	$	42,301	$	(40,021)	$	2,280

Schedule of estimated future amortization of intangible assets

As of December 31, 2021, estimated future amortization of intangible assets is as follows:


	Amount
(in thousands)
2022	$	760
2023	760
Total	$	1,520

Income Taxes - Unrecognized Tax Benefits Roll Forward (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward]
Unrecognized tax benefits at beginning of year	$ 3,318	$ 3,989
Reductions based on prior year tax positions	0	(1,481)
Additions based on prior year tax provisions	593	132
Additions based on current year tax provisions	1,431	678
Reductions due to tax authorities’ settlements	(2,824)	0
Reductions due to expirations of statutes of limitation	(139)	0
Unrecognized tax benefits at end of year	$ 2,379	$ 3,318

Segment Information (Tables)

12 Months Ended

Dec. 31, 2021

Segment Reporting [Abstract]

Schedule of Key Financial Performance Measures of the Segments

Key financial performance measures of the segments including revenue, cost of revenue and gross profit are as follows:


	Year Ended December 31,
	2021		2020		2019
(in thousands)
Connected Machines:
Revenue	$	548,205	$	416,714	$	198,144
Cost of revenue	484,025		351,898		176,894
Gross profit	$	64,180	$	64,816	$	21,250

Subscriptions:
Revenue	$	205,858	$	111,337	$	53,829
Cost of revenue	21,961		13,125		8,827
Gross profit	$	183,897	$	98,212	$	45,002

Accessories and Materials:
Revenue	$	552,164	$	430,979	$	234,581
Cost of revenue	342,791		261,633		158,483
Gross profit	$	209,373	$	169,346	$	76,098

Consolidated:
Revenue	$	1,306,227	$	959,030	$	486,554
Cost of revenue	848,777		626,656		344,204
Gross profit	$	457,450	$	332,374	$	142,350

Stock-Based Compensation - Cost by Award Type (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expensed and capitalized	$ 42,202	$ 10,117	$ 1,930
Equity-classified awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expensed and capitalized	35,755	4,956	1,625
Liability-classified awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expensed and capitalized	$ 6,447	$ 5,161	$ 305

Property and Equipment

12 Months Ended

Dec. 31, 2021

Property, Plant and Equipment [Abstract]

Property and Equipment

The composition of property and equipment is as follows:


	December 31,
	2021		2020
(in thousands)
Computer software, software development costs and equipment	$	70,663	$	50,242
Furniture and fixtures	5,243		5,184
Leasehold improvements	4,018		3,587
Manufacturing tools and equipment	29,753		15,563
Vehicles	—		22
Assets under construction	9,118		7,702
Total cost of property and equipment	118,795		82,300
Less: accumulated depreciation	(65,534)		(48,859)
Property and equipment, net	$	53,261	$	33,441

Depreciation expense for the years ended December 31, 2021, 2020 and 2019 was $18.3 million, $13.2 million and $8.3 million, respectively. Property and equipment, along with all other Company assets, including inventory, are pledged as collateral on the revolving credit facility (see Note 8).

Stock-Based Compensation - Restricted Stock Units Equivalent Activity Under Company's Stock Plans (Details) - Restricted Stock Unit Equivalents (“RSU equivalents”) - 2021 Equity Incentive Plan $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2021 USD ($) $ / shares shares
Number of RSU Equivalents
Beginning balance (in shares) \| shares	0
Granted (in shares) \| shares	94,304
Vested (in shares) \| shares	(13,227)
Ending balance (in shares) \| shares	81,077
Weighted- Average Base Price
Beginning balance (in dollars per share) \| $ / shares
Granted (in dollars per share) \| $ / shares	20.00
Vested (in dollars per share) \| $ / shares	20.00
Ending balance (in dollars per share) \| $ / shares	$ 20.00
Aggregate Intrinsic Value
Beginning aggregate intrinsic value \| $
Vested aggregate intrinsic value \| $	436
Ending aggregate intrinsic value \| $	$ 1,231

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2021

Income Tax Disclosure [Abstract]

Reconciliation of Income Tax Computed at U.S. Federal Statutory Rate to Effective Tax Rate

The reconciliation of income tax computed at the U.S. federal statutory tax rate to our effective income tax rate is as follows:


	Year Ended December 31,
	2021		2020		2019

Income tax provision at statutory rate	21.0	%	21.0	%	21.0	%
State taxes, net	4.7		2.2		2.4
Stock-based compensation	2.1		0.8		0.7
Foreign derived intangible income deduction	(1.4)		(0.7)		—
Tax credits	(2.9)		(1.1)		(2.8)
Return to provision adjustments	2.3		(0.1)		0.3
Other	1.2		0.3		0.4
Total provision for income taxes	27.0	%	22.4	%	22.0	%

Components of Net Deferred Tax Assets

Significant components of the Company’s net deferred tax assets are comprised of the following:


	December 31,
	2021		2020
(in thousands)
Deferred tax assets:
Inventories	$	3,387	$	4,092
Deferred rent	—		370
Lease liability	5,068		—
Accounts receivable	372		83
Sales refund liability	2,002		816
Deferred revenue	1,243		640
Stock-based compensation	4,668		394
Amortization	149		182
Net operating loss carryforwards	146		171
Tax credits	1,003		1,064
Other	853		1,449
Total deferred tax assets	18,891		9,261
Deferred tax liabilities:
Depreciation and amortization	(11,215)		(6,142)
ROU lease asset	(4,421)		—
Total deferred tax liabilities	(15,636)		(6,142)
Net deferred tax assets	$	3,255	$	3,119

Schedule of Components of Income Tax Expense (Benefit)


	Year Ended December 31,
	2021		2020		2019
(in thousands)
Current:
Federal	$	44,093	$	41,900	$	11,070
State	7,780		5,132		1,244
Foreign	162		(125)		—
Total current	52,035		46,907		12,314
Deferred:
Federal	(23)		(2,492)		(1,535)
State	(137)		200		278
Foreign	25		—		—
Total deferred	(135)		(2,292)		(1,257)
Income tax provision	$	51,900	$	44,615	$	11,057

Schedule of Unrecognized Tax Benefits Roll Forward

The total balance of unrecognized gross tax benefits for the years ended December 31, 2021 and 2020, resulting primarily from research and development credits, fixed asset and inventory basis differences were as follows:


	Year Ended December 31,
	2021		2020
(in thousands)
Unrecognized tax benefits at beginning of year	$	3,318	$	3,989
Reductions based on prior year tax positions	—		(1,481)
Additions based on prior year tax provisions	593		132
Additions based on current year tax provisions	1,431		678
Reductions due to tax authorities’ settlements	(2,824)		—
Reductions due to expirations of statutes of limitation	(139)		—
Unrecognized tax benefits at end of year	$	2,379	$	3,318

Revenue and Deferred Revenue - Schedule of Recognition of Deferred Revenue (Details) $ in Thousands	Dec. 31, 2021 USD ($)
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue expected to be recognized	$ 35,405
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue expected to be recognized	$ 30,547
Revenue, expected timing of satisfaction, period	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue expected to be recognized	$ 3,564
Revenue, expected timing of satisfaction, period	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue expected to be recognized	$ 1,294
Revenue, expected timing of satisfaction, period	1 year

Subsequent Events (Details) - Restricted stock units - Subsequent Event	Jan. 07, 2022 $ / shares shares
Subsequent Event [Line Items]
Granted (in shares) \| shares	6,615,000
Tranche One
Subsequent Event [Line Items]
Cumulative adjusted earnings per share over eight quarters (in dollars per share)	$ 4.93
Tranche Two
Subsequent Event [Line Items]
Cumulative adjusted earnings per share over eight quarters (in dollars per share)	$ 6.16

Property and Equipment - Narrative (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Property, Plant and Equipment [Abstract]
Depreciation	$ 18.3	$ 13.2	$ 8.3

Income Taxes - Narrative (Details) - USD ($) $ in Thousands	12 Months Ended
Income Taxes - Narrative (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Income Tax Examination [Line Items]
Income before provision for income taxes	$ 192,373	$ 199,193	$ 50,268
Unrecognized tax benefits that would affect effective tax rate if recognized	2,800	1,400	1,800
UNITED STATES
Income Tax Examination [Line Items]
Income before provision for income taxes	$ 191,500	$ 199,700	$ 50,200

- Definition

Amount of income (loss) from continuing operations, including income (loss) from equity method investments, before deduction of income tax expense (benefit), and income (loss) attributable to noncontrolling interest.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 30
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8906-108599

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (f)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599

Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 940
-SubTopic 20
-Section 25
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=123384075&loc=d3e41242-110953

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 22
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8736-108599

Reference 6: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 220
-SubTopic 10
-Section S99
-Paragraph 2
-Subparagraph (SX 210.5-03(10))
-URI http://asc.fasb.org/extlink&oid=123367319&loc=SL114868664-224227

Reference 7: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 944
-SubTopic 220
-Section S99
-Paragraph 1
-Subparagraph (SX 210.7-04(8))
-URI http://asc.fasb.org/extlink&oid=120400993&loc=SL114874131-224263

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 235
-Section S99
-Paragraph 1
-Subparagraph (SX 210.9-05(b)(2))
-URI http://asc.fasb.org/extlink&oid=120399901&loc=d3e537907-122884

Reference 9: http://www.xbrl.org/2003/role/exampleRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 31
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8924-108599

Reference 10: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 220
-Section S99
-Paragraph 1
-Subparagraph (SX 210.9-04(15))
-URI http://asc.fasb.org/extlink&oid=120399700&loc=SL114874048-224260

+ Details

Employee Benefit Plan - Narrative (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Retirement Benefits [Abstract]
Employer matching contribution (percentage)	50.00%
Employer matching contribution as a percent of employees' gross pay (percentage)	12.00%
Employer contribution amount	$ 2.4	$ 1.1

Capital Structure - Narrative (Details)		12 Months Ended
Capital Structure - Narrative (Details)	Apr. 28, 2021 shares	Dec. 31, 2021 vote $ / shares shares	Dec. 31, 2020 shares	Sep. 01, 2020 $ / shares
Equity, Class of Treasury Stock [Line Items]
Preferred stock, shares authorized (in shares)		100,000,000	0
Preferred stock, par value (in dollars per share) \| $ / shares		$ 0.001
Common stock, shares authorized (in shares)		1,250,000,000	257,058,262
Common stock, par value (in dollars per share) \| $ / shares		$ 0.001
Common stock, shares issued (in shares)		221,913,559	208,116,104
Common stock, shares outstanding (in shares)		221,913,559	208,116,104
Common Class A
Equity, Class of Treasury Stock [Line Items]
Common stock, shares authorized (in shares)		1,000,000,000
Common stock, par value (in dollars per share) \| $ / shares				$ 0.01
Sale of stock, shares issued in transaction	968,815
Common stock, shares issued (in shares)		37,886,660
Common stock, shares outstanding (in shares)		37,886,660
Number of votes per share \| vote		1
Number of shares issuable upon conversion (in shares)		1
Common Class A \| Existing Stockholders
Equity, Class of Treasury Stock [Line Items]
Sale of stock, shares issued in transaction	150,984	23,838,863
Common Class B
Equity, Class of Treasury Stock [Line Items]
Common stock, shares authorized (in shares)		250,000,000
Common stock, shares issued (in shares)		184,026,899
Common stock, shares outstanding (in shares)		184,026,899
Number of votes per share \| vote		5

Income Taxes - Reconciliation of Income Tax Computed at U.S. Federal Statutory Rate to Effective Tax Rate (Details)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Income Tax Disclosure [Abstract]
Income tax provision at statutory rate	21.00%	21.00%	21.00%
State taxes, net	4.70%	2.20%	2.40%
Stock-based compensation	2.10%	0.80%	0.70%
Foreign derived intangible income deduction	(1.40%)	(0.70%)	0.00%
Tax credits	(2.90%)	(1.10%)	(2.80%)
Return to provision adjustments	2.30%	(0.10%)	0.30%
Other	1.20%	0.30%	0.40%
Total provision for income taxes	27.00%	22.40%	22.00%

Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2021

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

Use of Estimates

Comprehensive Income

Comprehensive income consists of two components: net income and other comprehensive income (loss). Other comprehensive income (loss) refers to net gains and losses that are recorded as an element of stockholders’ equity but are excluded from net income. The Company’s other comprehensive income (loss) consists of foreign currency translation adjustments from those subsidiaries not using the U.S. dollar as their functional currency. Realized and unrealized foreign currency transaction gains and losses included in net income are recorded within operating expenses. Foreign currency transaction gains (losses) totaled $(0.9) million, $(0.3) million, and $0.2 million for the years ended December 31, 2021, 2020, and 2019, respectively.

Cash and Cash Equivalents

Accounts Receivable

Accounts receivable are recorded at original invoice amounts less estimates for credit losses. Management determines the allowance for credit losses by specifically identifying troubled accounts and by using historical write off experience, adjusted for current market conditions and reasonable supportable forecasts of future economic conditions, applied to an aging of all other accounts. Accounts receivable are written off when deemed uncollectible. Recoveries of accounts receivable previously written off are recorded when received. Accounts receivable consist of the following:


	December 31,
	2021		2020
(in thousands)
Trade accounts receivable	$	194,757	$	161,070
Other receivables	6,205		2,218
Less: Allowance for doubtful accounts	(1,454)		(357)
Total accounts receivable, net	$	199,508	$	162,931

The movements in the allowance for credit losses were not material for any of the periods presented.

Concentration of Credit Risk


	December 31,
	2021		2020
Customer A	23	%	21	%
Customer B	*		16	%
Customer C	12	%	22	%
Customer D	*		10	%

* Accounts receivable was less than 10%.

Customers with revenue equal to or greater than 10% of total revenue for the periods indicated were as follows:


	Year Ended December 31,
	2021		2020		2019
Customer A	11	%	*		12	%
Customer B	*		11	%	11	%
Customer C	10	%	14	%	*
Customer D	14	%	14	%	21	%

* Revenue was less than 10%.

The revenue from these customers is associated with the Connected Machines and Accessories and Materials segments.

Supplier Concentration

Inventories

Inventories, which primarily consist of finished goods, are valued at the lower of average cost or net realizable value. Net realizable value is defined as estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. Assessments to value the inventory at the lower of the average cost to purchase the inventory, or the net realizable value of the inventory, are based upon assumptions about future demand, physical deterioration, changes in price levels and market conditions. As a result of the Company’s assessments, when the net realizable value of inventory is less than the carrying value, the inventory cost is written down to the net realizable value and the write down is recorded as a charge to cost of revenue. Inventories include indirect acquisition and production costs that are incurred to bring the inventories to their present condition and location. Inventories are recorded net of reserves for obsolescence. Once established, the original cost of the inventory less the related inventory reserve represents the new cost basis of such products.

Property and Equipment

Property and equipment are stated at cost, less accumulated depreciation and amortization. Major additions and improvements are capitalized, while minor repairs and maintenance costs are expensed when incurred. Manufacturing tools include tools and molds used in the production process. Expenditures for tools and molds are capitalized and depreciated over the estimated useful lives of the assets. We capitalize certain software development costs in the application development stage in accordance with ASC 350-40, “Accounting for Costs of Computer Software Developed or Obtained for Internal Use” and upon the establishment of technological feasibility for a product in accordance with ASC 985-20, “Software to Be Sold, Leased or Otherwise Marketed. When assets are sold or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in the consolidated statements of operations. Depreciation and amortization are calculated using the straight-line method over the estimated useful lives of the related assets.

The Company uses the following estimated useful lives:


Computer software, software development costs and equipment						3-5 years
Furniture and fixtures						5-7 years
Manufacturing tools and equipment						3-5 years
Vehicles						5 years
Leasehold improvements						Shorter of lease term or remaining life of the asset

Leases

Legal Contingencies

Debt Issuance Costs

Third-party costs incurred to obtain debt financing are capitalized and amortized using the effective interest method over the life of the debt instruments.

Deferred Offering Costs

The Company recorded deferred offering costs of $1.9 million as other assets on the consolidated balance sheet as of December 31, 2020 and consist of costs incurred in connection with the Company’s IPO, including legal, accounting, printing and other IPO-related costs. Upon completion of the IPO, these deferred offering costs were reclassified to stockholders’ equity and recorded against the proceeds from the offering.

Impairment of Long-lived Assets

Fair Value of Financial Instruments

Fair Value Measurement


			•			Level I – Quoted prices are available in active markets for identical assets and liabilities as of the reporting date.


			•			Level II – Significant other observable inputs (e.g., quoted prices for similar items in active markets, quoted prices for identical or similar items in markets that are not active, inputs other than quoted prices that are observable, such as interest rate and yield curves and market-corroborated inputs). Pricing inputs are either directly or indirectly observable as of the reporting date, and fair value is determined through the use of models or other valuation methodologies.


			•			Level III – Pricing inputs are unobservable for the assets and liabilities and includes situations where there is little, if any, market activity for the assets and liabilities. The inputs into the determination of fair value require significant management judgment or estimation.

The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability.

No long-lived assets were measured at fair value on a recurring basis, and financial instruments measured at fair value on a recurring basis were not material at each of December 31, 2021 and 2020.

Earnings Per Share

Revenue Recognition

The Company determines revenue recognition through the following steps:


			•			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; and


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

of the goods as activities to fulfill the promise to transfer the good. The Company does not incur significant costs to obtain contracts with customers.

Connected Machines

Subscriptions

Accessories and Materials

Cost of Revenue

Connected Machines

Subscriptions

Cost of revenue related to Subscriptions consists primarily of hosting fees, digital content costs, amortization of capitalized software development costs and software maintenance costs.

Accessories and Materials

Customer Rebates

Sales Refund Liability

Changes in the reserve for sales refunds were as follows:


	December 31,
	2021		2020
(in thousands)
Balance at beginning of period	$	3,515	$	941
Additions that reduced net revenue	15,889		8,664
Deductions from reserves for current year returns	(11,578)		(6,090)
Balance at end of period	$	7,826	$	3,515

Warranty Reserves

The Company provides an assurance-type limited warranty on most of the products sold. The estimated warranty costs, which are expensed at the time of sale and included in cost of revenue, are based on the results of product testing, industry and historical trends and warranty claim rates incurred and are adjusted for any current or expected trends as appropriate. Actual warranty claim costs could differ from these estimates. The Company regularly assesses and adjusts the estimate of accrued warranty claims by updating claims rates for actual trends and projected claim costs.

Changes in the reserve for product warranties were as follows:


	December 31,
	2021		2020
(in thousands)
Warranty reserve, beginning of period	$	1,284	$	633
Additions charged to cost of revenue	7,261		2,683
Repairs and replacements	(6,147)		(2,032)
Warranty reserve, end of period	$	2,398	$	1,284

Income Taxes

Sales Taxes

South Dakota v. Wayfair is a U.S. Supreme Court case that was decided on June 21, 2018 that nullified the physical presence precedent established by Quill Corp. v North Dakota in 1992. The overarching effect of the Wayfair case was that state governments were given the power to impose sales tax on the shipment of goods to customers located within their state boundary even if the seller did not have a physical presence within the state. As such, the Company is required by certain governmental authorities to collect sales taxes on certain transactions. The Company currently collects and reports on sales tax in all states in which it does business. However, the application of existing,

new or revised taxes on our business, in particular, sales taxes, VAT and similar taxes would likely increase the cost of doing business online and decrease the attractiveness of selling products over the Internet. The application of these taxes on our business could also create significant increases in internal costs necessary to capture data and collect and remit taxes. There have been, and will continue to be, substantial ongoing costs associated with complying with the various indirect tax requirements in the numerous markets in which we conduct or will conduct business. The Company conducts ongoing analysis on state sales tax nexus regulations to determine where collection is necessary. The Company accounts for sales taxes as part of accrued expenses and excludes them from revenue.

Stock-Based and Stock-Equivalent Compensation

Common Unit Valuations

Fair value of the underlying common units of Cricut Holdings was historically determined by Cricut Holdings’ Board of Managers (“Board of Managers”) on the date of grant for all awards granted. In the absence of a public trading market, the Board of Managers, with input from management, exercised significant judgment and consider numerous objective and subjective factors to determine the fair value of Cricut Holdings’ common units as of the date of each award grant, including:


			•			relevant precedent transactions involving Cricut Holdings’ capital units;


			•			Cricut Holdings’ actual consolidated operating and financial performance;


			•			current business conditions and projections;


			•			Cricut Holdings’ stage of development;


			•			the likelihood and timing of achieving a liquidity event, such as an initial public offering, given prevailing market conditions;


			•			any adjustment necessary to recognize a lack of marketability of the common units;


			•			the market performance of comparable publicly traded companies; and


			•			U.S. and global capital market conditions.

In addition, Cricut Holdings’ Board of Managers considered the independent valuations completed by a third-party valuation consultant. The valuations of Cricut Holdings’ common units were determined in accordance with the guidelines outlined in the American Institute of Certified Public Accountants Practice Aid, Valuation of Privately-Held-Company Equity Securities Issued as Compensation.

Shipping and Handling Revenue and Expenses

Advertising Costs

Research and Development (“R&D”)

Recently Issued Accounting Standards

Recently adopted accounting standards

The impact of the adoption of Topic 842 on the accompanying consolidated balance sheet as of January 1, 2021 was as follows:


	As reported December 31, 2020		Adjustments due to the adoption of Topic 842		As adjusted January 1, 2021
(in thousands)
Assets:
Operating lease right-of-use assets	$	—	$	15,036	$	15,036
Prepaid expenses and other current assets:					—
Prepaid rent	9		(9)		—
Liabilities:
Accounts payable and accrued liabilities
Operating lease liabilities - current	—		3,918		3,918
Deferred rent	2,376		(2,376)		—
Operating lease liabilities - non-current	$	—	$	13,485	$	13,485

Stock-Based Compensation - Stock Option Activity (Details) - 2021 Equity Incentive Plan $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2021 USD ($) $ / shares shares
Number of Options
Beginning balance (in shares) \| shares	0
Granted (in shares) \| shares	3,419,359
Exercised (in shares) \| shares	(13,592)
Forfeited / cancelled (in shares) \| shares	(145,410)
Ending balance (in shares) \| shares	3,260,357
Vested and exercisable (in shares) \| shares	1,379,702
Weighted- Average Exercise Price
Beginning weighted average exercise price (in dollars per share) \| $ / shares	$ 0
Granted (in dollars per share) \| $ / shares	20.00
Exercised (in dollars per share) \| $ / shares	20.00
Forfeited (in dollars per share) \| $ / shares	20.00
Ending weighted average exercise price (in dollars per share) \| $ / shares	20.00
Vested and exercisable (in dollars per share) \| $ / shares	$ 20.00
Weighted- Average Remaining Term (Years)
Weighted average remaining terms (years)	5 years 9 months 18 days
Weighted average remaining terms, vested and exercisable (years)	5 years 1 month 6 days
Aggregate Intrinsic Value
Beginning aggregate intrinsic value \| $
Ending aggregate intrinsic value \| $	6,814
Vested and exercisable aggregate intrinsic value \| $	$ 2,884

Related Party Transactions - Narrative (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Related Party Transaction [Line Items]
Proceeds from capital contributions	$ 200	$ 1,088	$ 1,296
Affiliated Entity
Related Party Transaction [Line Items]
Proceeds from capital contributions	$ 200	$ 2,500	$ 1,300

Capital Structure	12 Months Ended
Capital Structure	Dec. 31, 2021
Equity [Abstract]
Capital Structure	Capital Structure In connection with the Corporate Reorganization prior to the IPO, the Company filed an amended and restated certification of incorporation which authorized 100,000,000 shares of preferred stock, par value $0.001 per share, and 1,250,000,000 shares of common stock, par value $0.001 per share, which was divided between two series Class A common stock and Class B common stock. All previously outstanding common stock was reclassified as Class B common stock. During the year ended December 31, 2021, 23,838,863 shares of Class B common stock were converted to Class A common stock. As of December 31, 2021, the Company had 1,000,000,000 shares of Class A common stock and 250,000,000 shares of Class B common stock authorized and 37,886,660 shares of Class A common stock and 184,026,899 shares of Class B common stock issued and outstanding. Each share of Class A common stock is entitled to one vote per share. Each share of Class B common stock is entitled to five votes per share and is convertible at any time into one share of Class A common stock.

- Definition

The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 13
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123467817&loc=SL123496158-112644

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 13
-URI http://asc.fasb.org/extlink&oid=123467817&loc=SL123496158-112644

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 14
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=123467817&loc=SL123496171-112644

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 14
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123467817&loc=SL123496171-112644

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.3-04)
-URI http://asc.fasb.org/extlink&oid=120397183&loc=d3e187085-122770

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 18
-Subparagraph (d)
-URI http://asc.fasb.org/extlink&oid=123467817&loc=SL123496189-112644

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 13
-Subparagraph (g)
-URI http://asc.fasb.org/extlink&oid=123467817&loc=SL123496158-112644

Reference 8: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-URI http://asc.fasb.org/topic&trid=2208762

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 18
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123467817&loc=SL123496189-112644

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 13
-Subparagraph (h)
-URI http://asc.fasb.org/extlink&oid=123467817&loc=SL123496158-112644

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 14
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123467817&loc=SL123496171-112644

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 18
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123467817&loc=SL123496189-112644

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 16
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123467817&loc=SL123496180-112644

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 13
-Subparagraph (i)
-URI http://asc.fasb.org/extlink&oid=123467817&loc=SL123496158-112644

Reference 15: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(e)(1))
-URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

+ Details

Stock-Based Compensation - Summary of Outstanding Equity Classified Incentive Units (Details) - Equity Classified Incentive Units $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2021 USD ($) $ / shares shares
Number of Shares
Beginning balance (in shares) \| shares	93,371,324
Granted (in shares) \| shares	1,548,223
Exercised (in shares) \| shares	0
Forfeited (in shares) \| shares	(82,500)
Cancelled (in shares) \| shares	(94,837,047)
Ending balance (in shares) \| shares	0
Vested (in shares) \| shares	0
Weighted- Average Participation Threshold
Beginning weighted average participation threshold (in dollars per share) \| $ / shares	$ 0.97
Granted (in dollars per share) \| $ / shares	0
Exercised (in dollars per share) \| $ / shares	0
Forfeited (in dollars per share) \| $ / shares	1.29
Cancelled (in dollars per share) \| $ / shares	0.95
Ending weighted average participation threshold (in dollars per share) \| $ / shares	0
Vested (in dollars per share) \| $ / shares	$ 0
Aggregate Intrinsic Value
Beginning aggregate intrinsic value \| $	$ 600,316
Ending aggregate intrinsic value \| $	0
Vested aggregate intrinsic value \| $	$ 0