CONSOLIDATED STATEMENTS OF CASH FLOWS(Unaudited) Three Months Ended March 31,(In millions) 2024 2025 Cash Flows From Operating Activities Net loss$(640.6) $(71.5)Adjustments to reconcile net loss to net cash provided by operating activities: Depreciation and amortization 74.8 73.9 Reduction in carrying amount of operating right-of-use assets 15.8 16.6 Deferred income taxes (24.4) (1.3)Share-based compensation expense 12.8 12.0 Impairment of goodwill 573.2 — Impairment of assets, net 20.0 — Gain on debt extinguishment, net of debt modification costs (56.7) — (Gain) loss on investments, net (0.1) 0.1 Provision for bad debts and accrued customer credits 4.3 — Amortization of debt issuance costs and debt discount and premium (2.0) 1.5 Third party fees paid in connection with the March 2024 Refinancing Transactions (28.4) — Other operating activities (0.2) 1.2 Changes in operating assets and liabilities: Accounts receivable 31.6 30.2 Prepaid expenses and other current assets (14.7) (13.2)Accounts payable, accrued expenses, and other current liabilities (50.3) (17.3)Deferred revenue 1.0 (9.3)Operating lease liabilities (20.5) (20.3)Other non-current assets and liabilities 14.1 10.0 Net cash provided by (used in) operating activities (90.3) 12.6 Cash Flows From Investing Activities Purchases of property, equipment and software (28.1) (8.3)Proceeds from sale of headquarters 16.9 — Other investing activities 0.1 (0.5) Net cash used in investing activities (11.1) (8.8)Cash Flows From Financing Activities Shares of common stock withheld for employee taxes (3.4) — Proceeds from borrowings under long-term debt arrangements 275.0 30.0 Payments on long-term debt (35.6) (26.1)Debt extinguishment costs (22.1) — Payments on financing component of interest rate swap (4.3) (4.3)Principal payments of finance lease liabilities (17.9) (13.2)Principal payments of financing obligations (3.5) (7.0) Net cash provided by (used in) financing activities 188.2 (20.6) Effect of exchange rate changes on cash, cash equivalents, and restricted cash (1.0) 0.9 Increase (decrease) in cash, cash equivalents, and restricted cash 85.8 (15.9) Cash, cash equivalents, and restricted cash at beginning of period 199.7 147.0 Cash, cash equivalents, and restricted cash at end of period$285.5 $131.1 Supplemental Cash Flow Information Cash payments for interest, net of amount capitalized$53.3 $22.2 Cash payments for income taxes, net of refunds$1.0 $1.2 Non-cash Investing and Financing Activities Acquisition of property, equipment and software by finance leases$— $23.5 Increase (decrease) in property, equipment and software accrued in liabilities 18.1 (5.1)Other non-cash activity (0.6) — Non-cash purchases of property, equipment and software$17.5 $18.4 SEGMENT DATA (In millions, except %)Three Months Ended March 31, % ChangeRevenue by segment: 2024 2025 Actual Constant Currency (a)Public Cloud$422.4 $415.6 (1.6)% (1.3)%Private Cloud 268.4 249.8 (6.9)% (6.6)%Total consolidated revenue$690.8 $665.4 (3.7)% (3.4)% (a)Refer to "Non-GAAP Financial Measures" in this section for further explanation and reconciliation. Three Months Ended March 31, Year-Over-Year Comparison(In millions, except %) 2024 2025 Segment operating profit (a):Amount % of Segment Revenue Amount % of Segment Revenue Amount % ChangePublic Cloud$8.2 1.9% $17.3 4.2% $9.1 111.0 %Private Cloud 71.1 26.5% 61.0 24.4% (10.1) (14.2)%Corporate functions (b) (65.3) (52.7) 12.6 (19.3)%Non-GAAP Operating Profit (c)$14.0 $25.6 $11.6 82.9 % (a)Segment revenue less expenses directly attributable to running the respective segments’ business.
Net loss reconciliation to Non-GAAP Net Loss Three Months Ended March 31,(In millions) 2024 2025 Net loss$(640.6) $(71.5)Share-based compensation expense 12.8 12.0 Transaction-related adjustments, net (a) 1.0 1.5 Restructuring and transformation expenses (b) 20.9 13.1 Hosted Exchange incident expenses, net of proceeds received or expected to be received under our insurance coverage 0.2 — Impairment of goodwill 573.2 — Impairment of assets, net 20.0 — Net (gain) loss on divestiture and investments (c) (0.1) 0.1 Gain on debt extinguishment, net of debt modification costs (56.7) — Interest expense impact from the March 2024 Refinancing Transactions (d) — (21.0)Other adjustments (e) 0.4 0.4 Amortization of intangible assets (f) 38.7 37.4 Tax effect of non-GAAP adjustments (g) 4.4 13.3 Non-GAAP Net Loss$(25.8) $(14.7) Loss from operations reconciliation to Non-GAAP Operating Profit Three Months Ended March 31,(In millions) 2024 2025 Loss from operations$(652.8) $(38.4)Share-based compensation expense 12.8 12.0 Transaction-related adjustments, net (a) 1.0 1.5 Restructuring and transformation expenses (b) 20.9 13.1 Hosted Exchange incident expenses, net of proceeds received or expected to be received under our insurance coverage 0.2 — Impairment of goodwill 573.2 — Impairment of assets, net 20.0 — Amortization of intangible assets (f) 38.7 37.4 Non-GAAP Operating Profit$14.0 $25.6 Net loss reconciliation to Adjusted EBITDA Three Months Ended March 31,(In millions) 2024 2025 Net loss$(640.6) $(71.5)Share-based compensation expense 12.8 12.0 Transaction-related adjustments, net (a) 1.0 1.5 Restructuring and transformation expenses (b) 20.9 13.1 Hosted Exchange incident expenses, net of proceeds received or expected to be received under our insurance coverage 0.2 — Impairment of goodwill 573.2 — Impairment of assets, net 20.0 — Net (gain) loss on divestiture and investments (c) (0.1) 0.1 Gain on debt extinguishment, net of debt modification costs (56.7) — Other expense, net (h) 5.6 5.4 Interest expense 43.7 19.4 Provision (benefit) for income taxes (4.7) 8.2 Depreciation and amortization (i) 74.9 73.1 Adjusted EBITDA$50.2 $61.3 (a)Includes purchase accounting adjustments, exploratory acquisition and divestiture costs, and expenses related to financing activities.(b)Includes consulting and advisory fees related to business transformation and optimization activities, as well as associated severance, certain facility closure costs, and lease termination expenses.
We define Non-GAAP Net Income (Loss) as net income (loss) adjusted to exclude the impact of non-cash charges for share-based compensation, transaction-related costs and adjustments, restructuring and transformation charges, costs related to the Hosted Exchange incident, the amortization of acquired intangible assets, goodwill and asset impairment charges, the interest expense impact from the refinancing transactions announced in March 2024 (the "March 2024 Refinancing Transactions”), and certain other non-operating, non-recurring or non-core gains and losses, as well as the tax effects of these non-GAAP adjustments.
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