Overstock.com 2011 Annual Report Download - page 66
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Table of Contents
Technology expenses
We seek to efficiently invest in technology, including web services, customer support solutions and website search, and in expansion of new and existing
product categories, and in investments in technology to enhance the customer experience, improve our process efficiency and support our logistics
infrastructure.
The following table reflects our technology expenses for the years ended December 31, 2011 and 2010 (in thousands):
Year ended
December 31,
2011 2010 $ Change % Change
Technology expenses $ 67,043 $ 58,260 $ 8,783 15.1%
Technology expenses as a percent of net revenues 6.4% 5.3%
The increase for the year ended December 31, 2011 is primarily due to a $4.7 million increase in compensation expense (primarily due to increases in
staffing), and a $1.9 million increase in depreciation expense.
Technology expenses include stock-based compensation expense of $628,000 and $1.1 million for the years ended December 31, 2011 and 2010,
respectively
General and administrative expenses
The following table reflects our general and administrative expenses for the years ended December 31, 2011 and 2010 (in thousands):
Year ended
December 31,
2011 2010 $ Change % Change
General and administrative expenses $67,766 $55,650 $12,116 21.8%
General and administrative expenses as a percent of net revenues 6.4% 5.1%
The increase in general and administrative expenses for the year ended December 31, 2011 is primarily due to a $12.3 million increase in legal fees. See
Legal Proceedings for more information.
General and administrative expenses include stock-based compensation expense of approximately $1.9 million and $3.2 million for the years ended
December 31, 2011 and 2010, respectively.
Restructuring
There were no restructuring charges or reversals during the year ended December 31, 2011. We reversed $569,000 of lease termination costs liability
during the year ended December 31, 2010 due to changes in our estimate of sublease income, primarily as a result of our entering into agreements with a
sublessee to terminate the subleases and have us re-occupy a portion of the space previously abandoned (see Item 15 of Part IV, "Financial Statements"—
Note 3—"Restructuring Expense").
Operating Expenses
Overall, our total operating expenses increased 12.6% to $196.6 million for the year ended December 31, 2011 from $174.7 million for the year ended
December 31, 2010, while total net revenues decreased 3.3% and gross profit decreased 5.6%.
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