Chegg 2014 Annual Report Download - page 86

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Table of Contents
48
The following table sets forth our cash flows (in thousands):
Year Ended December 31,
2014 2013 2012
Consolidated Statements of Cash Flows Data:
Net cash provided by operating activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 68,475 $ 63,706 54,681
Net cash used in investing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (87,350)(153,090)(88,103)
Net cash (used in) provided by financing activities. . . . . . . . . . . . . . . . . . . . . . . . . . . (1,872) 145,218 19,845
Cash Flows from Operating Activities
Although we incurred net losses during the year ended December 31, 2014, 2013, and 2012, we generated positive
cash flows from operating activities, which was primarily the result of our increased textbook and digital offerings revenue.
Cash flows from operating activities are also influenced by the increase in expenses we incur to support the growth in our
business. The substantial majority of our net revenue is from e-commerce transactions with students, which are settled
immediately through payment processors, as opposed to our accounts payable, which are settled based on contractual payment
terms with our suppliers. As a result, changes in our operating accounts are generally a source of cash overall, although they
can be a use of cash in the second and fourth quarters of each year as payables become due and new bookings are generally at
their low point. In addition, we have significant non-cash operating expenses such as textbook library depreciation expense,
other depreciation and amortization expense and share-based compensation expense. During the year ended December 31,
2014, 2013, and 2012, our non-cash operating expenses and changes in operating assets and liabilities more than offset our net
loss.
Net cash provided by operating activities during the year ended December 31, 2014 was $68.5 million. Although we
incurred a net loss of $64.8 million, our net loss was more than offset by significant non-cash operating expenses, including
textbook library depreciation expense of $70.1 million, other depreciation and amortization expense of $11.3 million, share-
based compensation expense of $36.9 million and loss from write-offs of textbooks of $10.5 million.
Net cash provided by operating activities during the year ended December 31, 2013 was $63.7 million. Although we
incurred a net loss of $55.9 million, our net loss was more than offset by significant non-cash operating expenses, including
textbook library depreciation expense of $64.8 million, other depreciation and amortization expense of $11.6 million, share-
based compensation expense of $37.0 million and loss from write-offs of textbooks of $5.9 million.
Net cash provided by operating activities during the year ended December 31, 2012 was $54.7 million. Although we
incurred a net loss of $49.0 million, our net loss was offset by significant non-cash operating expenses, including textbook
library depreciation expense of $57.2 million, other depreciation and amortization expense of $12.6 million, share-based
compensation expense of $18.0 million and loss from write-offs of textbooks of $4.6 million.
Cash Flows from Investing Activities
Cash flows from investing activities have been primarily related to the acquisition of businesses, purchase of
textbooks, investments and property and equipment, offset by proceeds from the sale or maturity of investments and the
proceeds from the liquidation of textbooks. Net cash used in investing activities during the year ended December 31, 2014 was
$87.4 million and was primarily used for the acquisition of businesses of $53.9 million, purchases of textbooks of $112.8
million, purchases of investments of $70.7 million and purchases of property and equipment of $5.1 million, partially offset by
proceeds from the sale or maturity of investments of $97.1 million and proceeds from the liquidation of textbooks of $58.1
million.
Net cash used in investing activities during the year ended December 31, 2013 was $153.1 million and was primarily
used for purchases of textbooks of $122.2 million, purchases of investments of $61.4 million and purchases of property and
equipment and other assets of $7.4 million, partially offset by proceeds from liquidation of textbooks of $37.9 million.
Net cash used in investing activities during the year ended December 31, 2012 was $88.1 million and was primarily
used for purchases of textbooks of $104.5 million and purchases of property and equipment of $15.1 million, partially offset by
proceeds from liquidation of textbooks of $34.1 million.