Fortinet, Inc. 10-K form for the fiscal year ended 2023-12-31, page 71: FORTINET, INC. 

CONSOLIDATED BALANCE SHEETS

(in millions, except per share amounts)

|    |                                                                                                                                                            |                  |         |                  |           |    |         |
|---:|:-----------------------------------------------------------------------------------------------------------------------------------------------------------|:-----------------|:--------|:-----------------|:----------|:---|:--------|
|  1 |                                                                                                                                                            | December 31,2023 |         | December 31,2022 |           |    |         |
|  2 | ASSETS                                                                                                                                                     |                  |         |                  |           |    |         |
|  3 | CURRENT ASSETS:                                                                                                                                            |                  |         |                  |           |    |         |
|  4 | Cash and cash equivalents                                                                                                                                  | $                | 1,397.9 |                  |           | $  | 1,682.9 |
|  5 | Short-term investments                                                                                                                                     | 1,021.5          |         |                  | 502.6     |    |         |
|  6 | Marketable equity securities                                                                                                                               | 21.0             |         |                  | 25.5      |    |         |
|  7 | Accounts receivable-Net of allowance for credit losses of $8.2 million and $3.6 million at December 31, 2023 and 2022, respectively                        | 1,402.0          |         |                  | 1,261.7   |    |         |
|  8 | Inventory                                                                                                                                                  | 484.8            |         |                  | 264.6     |    |         |
|  9 | Prepaid expenses and other current assets                                                                                                                  | 101.1            |         |                  | 73.1      |    |         |
| 10 | Total current assets                                                                                                                                       | 4,428.3          |         |                  | 3,810.4   |    |         |
| 11 | LONG-TERM INVESTMENTS                                                                                                                                      | -                |         |                  | 45.5      |    |         |
| 12 | PROPERTY AND EQUIPMENT-NET                                                                                                                                 | 1,044.4          |         |                  | 898.5     |    |         |
| 13 | DEFERRED CONTRACT COSTS                                                                                                                                    | 605.6            |         |                  | 518.2     |    |         |
| 14 | DEFERRED TAX ASSETS                                                                                                                                        | 868.8            |         |                  | 569.4     |    |         |
| 15 | GOODWILL                                                                                                                                                   | 126.5            |         |                  | 128.0     |    |         |
| 16 | OTHER INTANGIBLE ASSETS-NET                                                                                                                                | 35.3             |         |                  | 56.0      |    |         |
| 17 | OTHER ASSETS                                                                                                                                               | 150.0            |         |                  | 202.0     |    |         |
| 18 | TOTAL ASSETS                                                                                                                                               | $                | 7,258.9 |                  |           | $  | 6,228.0 |
| 20 | LIABILITIES AND STOCKHOLDERS' DEFICIT                                                                                                                      |                  |         |                  |           |    |         |
| 21 | CURRENT LIABILITIES:                                                                                                                                       |                  |         |                  |           |    |         |
| 22 | Accounts payable                                                                                                                                           | $                | 204.3   |                  |           | $  | 243.4   |
| 23 | Accrued liabilities                                                                                                                                        | 423.7            |         |                  | 266.3     |    |         |
| 24 | Accrued payroll and compensation                                                                                                                           | 242.3            |         |                  | 219.4     |    |         |
| 25 | Deferred revenue                                                                                                                                           | 2,848.7          |         |                  | 2,349.3   |    |         |
| 26 | Total current liabilities                                                                                                                                  | 3,719.0          |         |                  | 3,078.4   |    |         |
| 27 | DEFERRED REVENUE                                                                                                                                           | 2,886.3          |         |                  | 2,291.0   |    |         |
| 28 | LONG-TERM DEBT                                                                                                                                             | 992.3            |         |                  | 990.4     |    |         |
| 29 | OTHER LIABILITIES                                                                                                                                          | 124.7            |         |                  | 149.8     |    |         |
| 30 | Total liabilities                                                                                                                                          | 7,722.3          |         |                  | 6,509.6   |    |         |
| 31 | COMMITMENTS AND CONTINGENCIES (Note 12)                                                                                                                    |                  |         |                  |           |    |         |
| 32 | STOCKHOLDERS' DEFICIT:                                                                                                                                     |                  |         |                  |           |    |         |
| 33 | Common stock, $0.001 par value-1,500.0 shares authorized; 761.0 shares and 781.5 shares issued and outstanding at December 31, 2023 and 2022, respectively | 0.8              |         |                  | 0.8       |    |         |
| 34 | Additional paid-in capital                                                                                                                                 | 1,416.4          |         |                  | 1,284.2   |    |         |
| 35 | Accumulated other comprehensive loss                                                                                                                       | (18.9)           |         |                  | (20.2)    |    |         |
| 36 | Accumulated deficit                                                                                                                                        | (1,861.7)        |         |                  | (1,546.4) |    |         |
| 37 | Total stockholders' deficit                                                                                                                                | (463.4)          |         |                  | (281.6)   |    |         |
| 40 | TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT                                                                                                                | $                | 7,258.9 |                  |           | $  | 6,228.0 |
See notes to consolidated financial statements.
71




, Rapid7, Inc. 10-K form for the fiscal year ended 2023-12-31, page 61: 
Table of Contents


RAPID7, INC.

CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share data)|    |                                                                                                                                                                                                                                                                                     |                   |           |                   |           |    |           |
|---:|:------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|:------------------|:----------|:------------------|:----------|:---|:----------|
|  1 |                                                                                                                                                                                                                                                                                     | December 31, 2023 |           | December 31, 2022 |           |    |           |
|  2 | Assets                                                                                                                                                                                                                                                                              |                   |           |                   |           |    |           |
|  3 | Current assets:                                                                                                                                                                                                                                                                     |                   |           |                   |           |    |           |
|  4 | Cash and cash equivalents                                                                                                                                                                                                                                                           | $                 | 213,629   |                   |           | $  | 207,287   |
|  5 | Short-term investments                                                                                                                                                                                                                                                              | 169,544           |           |                   | 84,162    |    |           |
|  6 | Accounts receivable, net of allowance for credit losses of $951 and $2,299 at December 31, 2023 and December 31, 2022, respectively                                                                                                                                                 | 164,862           |           |                   | 152,045   |    |           |
|  7 | Deferred contract acquisition and fulfillment costs, current portion                                                                                                                                                                                                                | 45,008            |           |                   | 34,906    |    |           |
|  8 | Prepaid expenses and other current assets                                                                                                                                                                                                                                           | 41,407            |           |                   | 31,907    |    |           |
|  9 | Total current assets                                                                                                                                                                                                                                                                | 634,450           |           |                   | 510,307   |    |           |
| 10 | Long-term investments                                                                                                                                                                                                                                                               | 56,171            |           |                   | 9,756     |    |           |
| 11 | Property and equipment, net                                                                                                                                                                                                                                                         | 39,642            |           |                   | 57,891    |    |           |
| 12 | Operating lease right-of-use assets                                                                                                                                                                                                                                                 | 54,693            |           |                   | 79,342    |    |           |
| 13 | Deferred contract acquisition and fulfillment costs, non-current portion                                                                                                                                                                                                            | 76,601            |           |                   | 68,169    |    |           |
| 14 | Goodwill                                                                                                                                                                                                                                                                            | 536,351           |           |                   | 515,631   |    |           |
| 15 | Intangible assets, net                                                                                                                                                                                                                                                              | 94,546            |           |                   | 101,269   |    |           |
| 16 | Other assets                                                                                                                                                                                                                                                                        | 12,894            |           |                   | 16,626    |    |           |
| 17 | Total assets                                                                                                                                                                                                                                                                        | $                 | 1,505,348 |                   |           | $  | 1,358,991 |
| 18 | Liabilities and Stockholders' Equity (Deficit)                                                                                                                                                                                                                                      |                   |           |                   |           |    |           |
| 19 | Current liabilities:                                                                                                                                                                                                                                                                |                   |           |                   |           |    |           |
| 20 | Accounts payable                                                                                                                                                                                                                                                                    | $                 | 15,812    |                   |           | $  | 10,255    |
| 21 | Accrued expenses                                                                                                                                                                                                                                                                    | 84,489            |           |                   | 80,306    |    |           |
| 22 | Operating lease liabilities, current portion                                                                                                                                                                                                                                        | 13,452            |           |                   | 12,444    |    |           |
| 23 | Deferred revenue, current portion                                                                                                                                                                                                                                                   | 455,503           |           |                   | 426,599   |    |           |
| 24 | Other current liabilities                                                                                                                                                                                                                                                           | 536               |           |                   | 1,663     |    |           |
| 25 | Total current liabilities                                                                                                                                                                                                                                                           | 569,792           |           |                   | 531,267   |    |           |
| 26 | Convertible senior notes, net                                                                                                                                                                                                                                                       | 929,996           |           |                   | 815,948   |    |           |
| 27 | Operating lease liabilities, non-current portion                                                                                                                                                                                                                                    | 81,130            |           |                   | 85,946    |    |           |
| 28 | Deferred revenue, non-current portion                                                                                                                                                                                                                                               | 32,577            |           |                   | 31,040    |    |           |
| 29 | Other long-term liabilities                                                                                                                                                                                                                                                         | 10,032            |           |                   | 14,864    |    |           |
| 30 | Total liabilities                                                                                                                                                                                                                                                                   | $                 | 1,623,527 |                   |           | $  | 1,479,065 |
| 31 | Stockholders' deficit:                                                                                                                                                                                                                                                              |                   |           |                   |           |    |           |
| 32 | Preferred stock, $0.01 par value per share; 10,000,000 shares authorized at December 31, 2023 and 2022; 0 shares issued and outstanding at December 31, 2023 and 2022                                                                                                               | $                 | -         |                   |           | $  | -         |
| 33 | Common stock, $0.01 par value per share; 100,000,000 shares authorized at December 31, 2023 and 2022; 62,283,630 and 60,206,277 shares issued at December 31, 2023 and 2022, respectively; 61,714,051 and 59,719,469 shares outstanding at December 31, 2023 and 2022, respectively | 617               |           |                   | 597       |    |           |
| 34 | Treasury stock, at cost, 569,579 and 486,808 shares at December 31, 2023 and December 31, 2022, respectively                                                                                                                                                                        | (4,765)           |           |                   | (4,764)   |    |           |
| 35 | Additional paid-in-capital                                                                                                                                                                                                                                                          | 894,630           |           |                   | 746,249   |    |           |
| 36 | Accumulated other comprehensive (loss) income                                                                                                                                                                                                                                       | 1,344             |           |                   | (1,411)   |    |           |
| 37 | Accumulated deficit                                                                                                                                                                                                                                                                 | (1,010,005)       |           |                   | (860,745) |    |           |
| 38 | Total stockholders' deficit                                                                                                                                                                                                                                                         | (118,179)         |           |                   | (120,074) |    |           |
| 39 | Total liabilities and stockholders' deficit                                                                                                                                                                                                                                         | $                 | 1,505,348 |                   |           | $  | 1,358,991 |
See accompanying notes to consolidated financial statements.
61






Question: Compare the solvency ratios of Fortinet Inc. and Rapid7 Inc. for the year 2023.
Answer: Solvency ratios help in assessing a company's ability to meet its long-term obligations. The debt-to-equity ratio is a common measure of solvency, calculated as total debt divided by total equity.Fortinet -->Long term debt (2023): $992.3 million, Total Equity (2023): -$463.4 million (stockholders' deficit)->Debt-to-Equity Ratio (2023): 992.3/ -463.4 = -2.14 (negative due to stockholders' deficit). Rapid 7 - Total Debt (2023): $1,011,126 thousand, Total Equity (2023): -$118,179 thousand (stockholders' deficit)--> Debt-to-Equity Ratio (2023): $1,011,126 / -118,179 = -8.56 (negative due to stockholders' deficit). 
Both companies have negative equity, resulting in negative debt-to-equity ratios. This indicates that both Fortinet Inc. and Rapid7 Inc. are highly leveraged and have more liabilities than equity.