Cash Flow Statement

The cash flow statement provides information about a company cash receipts and cash payments during an accounting period, showing how these cash flows link the ending cash balance to the beginning balance shown on the company balance sheet.

The cash flow statement consists of three parts: cash flows provided by (used in) operating activities, cash flows provided by (used in) investing activities, and cash flows provided by (used in) financing activities.

Twitter Inc., consolidated cash flow statement

US$ in thousands

12 months ended:	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017
Net income (loss)	(221,409)	(1,135,626)	1,465,659)	1,205,596)	(108,063)
Depreciation and amortization expense	544,848)	495,177)	465,549)	425,498)	395,867)
Stock-based compensation expense	629,901)	474,932)	378,025)	326,228)	433,806)
Amortization of discount on convertible notes	—)	101,733)	113,298)	105,926)	80,061)
Bad debt expense	1,560)	18,775)	3,083)	1,610)	586)
Deferred income taxes	(228,774)	(36,978)	84,369)	43,409)	(6,415)
Deferred tax assets valuation allowance release	—)	—)	—)	(845,129)	—)
Deferred tax assets establishment related to intra-entity transfers of intangible assets	—)	—)	(1,206,880)	—)	—)
Deferred tax assets valuation allowance establishment	—)	1,101,374)	—)	—)	—)
(Gain) impairment on investments in privately-held companies	(101,445)	8,842)	1,550)	3,000)	62,439)
Other adjustments	2,975)	(10,764)	(19,989)	(15,749)	5,167)
Accounts receivable	(189,946)	(188,039)	(67,000)	(130,871)	2,668)
Prepaid expenses and other assets	(121,501)	6,398)	(29,602)	126,470)	(13,974)
Operating lease right-of-use assets	219,287)	168,000)	149,880)	—)	—)
Accounts payable	20,869)	18,232)	2,946)	(1,533)	8,371)
Accrued and other liabilities	260,475)	123,345)	92,681)	95,256)	(29,304)
Operating lease liabilities	(184,151)	(152,531)	(130,205)	—)	—)
Changes in assets and liabilities, net of assets acquired and liabilities assumed from acquisitions	5,033)	(24,595)	18,700)	89,322)	(32,239)
Adjustments to reconcile net income (loss) to net cash provided by operating activities	854,098)	2,128,496)	(162,295)	134,115)	939,272)
Net cash provided by operating activities	632,689)	992,870)	1,303,364)	1,339,711)	831,209)
Purchases of property and equipment	(1,011,546)	(873,354)	(540,688)	(483,934)	(160,742)
Proceeds from sales of property and equipment	8,462)	9,170)	6,158)	13,070)	2,783)
Purchases of marketable securities	(3,736,659)	(6,272,395)	(5,798,111)	(5,334,396)	(2,687,214)
Proceeds from maturities of marketable securities	3,811,768)	4,554,238)	4,928,097)	3,732,973)	2,579,747)
Proceeds from sales of marketable securities	1,172,626)	1,092,754)	367,116)	58,721)	124,826)
Changes in restricted cash	—)	—)	—)	—)	3,594)
Purchases of investments in privately-held companies	(39,761)	(11,912)	(51,163)	(3,375)	(825)
Investments in Finance Justice Fund	(69,500)	—)	—)	—)	—)
Business combinations, net of cash acquired	(32,702)	(48,016)	(29,664)	(33,572)	—)
Other investing activities	(50,065)	(11,050)	2,281)	(5,000)	24,899)
Net cash (used in) provided by investing activities	52,623)	(1,560,565)	(1,115,974)	(2,055,513)	(112,932)
Proceeds from issuance of convertible notes	1,437,500)	1,000,000)	—)	1,150,000)	—)
Proceeds from issuance of senior notes	—)	—)	700,000)	—)	—)
Purchases of convertible note hedges	(213,469)	—)	—)	(267,950)	—)
Proceeds from issuance of warrants concurrent with note hedges	161,144)	—)	—)	186,760)	—)
Debt issuance costs	(16,769)	(14,662)	(8,070)	(13,783)	—)
Repayment of convertible notes	(954,000)	—)	(935,000)	—)	—)
Repurchases of common stock	(930,530)	(245,292)	—)	—)	—)
Taxes paid related to net share settlement of equity awards	(26,982)	(22,587)	(19,594)	(19,263)	(8,962)
Payments of finance lease obligations	(565)	(23,062)	(66,677)	(90,351)	(102,775)
Proceeds from exercise of stock options	2,056)	5,442)	788)	3,415)	9,444)
Proceeds from issuances of common stock under employee stock purchase plan	68,792)	55,471)	42,378)	29,288)	23,920)
Net cash provided by (used in) financing activities	(472,823)	755,310)	(286,175)	978,116)	(78,373)
Foreign exchange effect on cash, cash equivalents and restricted cash	(13,080)	(4,005)	4,576)	(14,296)	9,911)
Net increase (decrease) in cash, cash equivalents and restricted cash	199,409)	183,610)	(94,209)	248,018)	649,815)
Cash, cash equivalents and restricted cash at beginning of period	2,011,276)	1,827,666)	1,921,875)	1,673,857)	988,598)
Cash, cash equivalents and restricted cash at end of period	2,210,685)	2,011,276)	1,827,666)	1,921,875)	1,638,413)

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

Profitability Trends: Net income shows significant volatility across the periods. The company experienced a net loss in 2017, substantial profits in 2018 and 2019, followed by losses again in 2020 and 2021, though the magnitude of the losses declined in 2021 compared to 2020. This pattern suggests inconsistent profitability and potential operational or market challenges in recent years.
Non-Cash Expenses: Depreciation and amortization expense exhibits a steady upward trend from 2017 through 2021, indicating increasing capital asset usage or acquisition. Stock-based compensation expense fluctuates, with a notable increase in 2020 and 2021, reaching its peak in 2021, which may imply enhanced employee incentives or changes in equity compensation policy.
Tax-Related Items: Deferred income taxes fluctuate markedly, peaking positively in 2019 but turning negative in subsequent years. The presence of large adjustments related to deferred tax assets valuation allowance indicates significant tax planning or adjustments reflecting changes in tax asset realizability. Notably, the company recorded releases and establishments of valuation allowances in different years, highlighting tax uncertainty or restructuring.
Receivables and Payables: Accounts receivable presents increasing negative balances after 2017, suggesting either write-offs, adjustments, or negative working capital changes in this area. Accounts payable and accrued liabilities show growth, with accrued and other liabilities increasing substantially by 2021, which may indicate growing operational obligations or accrued expenses.
Operating Lease Accounting: Operating lease right-of-use assets and corresponding liabilities were introduced starting in 2019, reflecting adoption of new lease accounting standards. Both assets and liabilities have increased steadily through 2021, suggesting expansion or renewal of leased assets.
Cash Flow from Operations: Net cash provided by operating activities rose sharply in 2018, remained robust through 2019, then declined somewhat in 2020 and 2021 but stayed positive. Adjustments to reconcile net income to cash flow from operations were large and volatile, indicating significant non-cash items or working capital changes.
Investing Activities: Purchases of property and equipment increased consistently over the five-year period, peaking in 2021, indicating ongoing investments in fixed assets. Marketable securities purchases and proceeds show large volumes, but net cash flow from investing activities was negative through 2020, turning slightly positive in 2021, signaling a shift toward liquidity or reduced investment.
Financing Activities: Financing cash flows vary considerably, with sizable proceeds from convertible and senior notes issuance in some years, coupled with repayments. Share repurchases commenced in 2020 and increased substantially in 2021, reflecting capital return policies or share price support. Overall, net financing activities show both inflows and outflows across years, denoting active capital structure management.
Liquidity Position: Cash, cash equivalents, and restricted cash balances increased overall during the period, with a few minor declines, reflecting a generally strengthening liquidity position. Net increases in cash were positive in all years except 2019, where a slight decrease was observed. This suggests careful cash management amid operational variability.
Other Observations: Bad debt expense elevated significantly in 2020 but declined sharply in 2021, which may relate to credit risk management or external economic conditions. Investments in privately-held companies and Finance Justice Fund purchases indicate strategic or social investments, though their amounts are relatively smaller compared to core investing and financing activities.

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Twitter Inc. (NYSE:TWTR)

Cash Flow Statement