What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2026-02-25 compared with 2025-02-25 · 184 added, 111 removed, 907 unchanged (25% of the section changed)

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Reports of Independent Registered Public Accounting Firm - Grant Thornton LLP (PCAOB ID:

Report of Independent Registered Public Accounting Firm - Armanino LLP (PCAOB ID:

Consolidated Balance Sheets as of December 31, 202 5 and 202 4

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We have audited the accompanying consolidated balance sheets of A10 Networks, Inc.

(a Delaware corporation) and subsidiaries (the “Company”) as of December 31, 2024 and 2023, the related consolidated statements of operations, comprehensive income, stockholders’ equity, and cash flows for each of the two years in the period ended December 31, 2024, and the related notes (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of America.

(a Delaware corporation) and subsidiaries (the “Company”) as of December 31, 2025 and 2024, the related consolidated statements of operations, comprehensive income, stockholders’ equity, and cash flows for each of the three years in the period ended December 31, 2025, and the related notes (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the Company’s internal control over financial reporting as of December 31, 2025, based on criteria established in the 2013 Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”), and our report dated February 25, 2026 expressed an unqualified opinion.

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The principal consideration for our determination that estimates of standalone selling price is a critical audit matter is that auditing the estimates involved subjective auditor judgment due to the absence of directly observable data which requires the Company to make subjective assumptions used to estimate the standalone selling price for each performance obligation.

If the Company does not have an observable standalone selling price, such as when they do not sell a product or service separately,

then standalone selling price is estimated using judgment and considering all reasonably available information such as market conditions and information about the size and/or purchase volume of the customer.

If the Company does not have an observable standalone selling price, such as when they do not sell a product or service separately, then standalone selling price is estimated using judgment and considering all reasonably available information such as market conditions and information about the size and/or purchase volume of the customer.

The Company generally uses a range of amounts to estimate standalone selling price for individual products and services based on multiple factors including, but not limited to the sales channel (reseller, distributor or end-customer), the geographies in which products and services are sold, and the size of the end-customer.

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February 25, 2026

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholders of A10 Networks, Inc.

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated statements of operations, comprehensive income, stockholders' equity, and cash flows of A10 Networks, Inc.

and subsidiaries (the Company) for the year ended December 31, 2022, and the related notes (collectively referred to as the consolidated financial statements).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the results of operations and cash flows for the Company for the year ended December 31, 2022 in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

The Company's management is responsible for these consolidated financial statements.

Our responsibility is to express an opinion on the Company's consolidated financial statements based on our audit.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud.

Our audit of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements.

Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.

We believe that our audit provides a reasonable basis for our opinion.

/s/ Armanino LLP

San Jose, California

February 27, 2023, except for the effect of the segment reporting discussed in Note 11 and stock award disclosures discussed in Note 8 as to which the date is February 25, 2025.

We served as the Company’s auditor since 2019.

In 2023, we became the predecessor auditor.

A10 NETWORKS, INC.

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Goodwill 15,134 1,307

Intangible assets 6,259 —

Deferred tax assets, net 62,109 62,364

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Deferred revenue, non-current 61,982 69,924

Long-term debt 218,787 —

Other non-current liabilities 3,848 7,489

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Dividends paid ( 72,785 ) ( 55,417 )

Accumulated other comprehensive income (loss) 194 ( 71 )

Accumulated deficit ( 40,344 ) ( 90,484 )

Accumulated other comprehensive income 659 194

Retained earnings (accumulated deficit) 1,793 ( 40,344 )

Total stockholders' equity 211,546 231,829

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Interest and other income (expense), net ( 6,348 ) 7,384 69

Total non-operating income (expense), net 14,131 5,147 ( 363 )

Total non-operating income, net 5,280 14,131 5,147

Income before income taxes 52,422 58,099 43,795

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Other comprehensive income (loss), net of tax:

Unrealized gain (loss) on marketable securities 214 911 ( 497 )

Unrealized gain on marketable securities 367 214 911

Foreign currency translation adjustment 98 51 ( 256 )

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Payments for dividends — — — — ( 17,817 ) — — ( 17,817 )

Unrealized loss on marketable securities, net of tax — — — — — ( 497 ) — ( 497 )

Unrealized gain on marketable securities, net of tax — — — — — 911 — 911

Other comprehensive loss — — — — — ( 256 ) — ( 256 )

Net Income — — — — — — 39,970 39,970

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Unrealized gain on marketable securities, net of tax — — — — — 214 — 214

Other comprehensive loss — — — — — ( 256 ) — ( 256 )

Other comprehensive income — — — — — 51 — 51

Net Income — — — — — — 50,140 50,140

34 unchanged sentences

Capital expenditures ( 20,128 ) ( 12,268 ) ( 10,896 )

Acquisition ( 19,100 ) — —

Net cash provided by (used in) investing activities ( 243,638 ) ( 48,350 ) 13,608

1 unchanged sentence

Proceeds from issuance of common stock under employee equity incentive plans 3,373 3,624 4,943

Proceeds from the issuance of convertible debt 225,000 — —

Payment of debt issuance costs ( 7,330 ) — —

Repurchases of common stock ( 68,920 ) ( 30,084 ) ( 15,975 )

Payments for dividends ( 17,369 ) ( 17,797 ) ( 17,817 )

Net cash used in financing activities ( 44,257 ) ( 28,849 ) ( 88,141 )

Net cash provided by (used in) financing activities 134,754 ( 44,257 ) ( 28,849 )

Net increase (decrease) in cash and cash equivalents ( 23,990 ) ( 2,115 ) 29,273

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GAAP requires us to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes.

Those estimates and assumptions affect revenue recognition and deferred revenue, the allowance for credit losses for potential uncollectible amounts, the sales return reserve, the valuation of inventory, the fair value of marketable securities, contingencies and litigation, accrued liabilities, deferred commissions and the determination of fair value of stock-based compensation.

Those estimates and assumptions affect revenue recognition and deferred revenue, the allowance for credit losses for potential uncollectible amounts, the sales return reserve, the valuation of inventory, the fair value of marketable securities, contingencies and litigation, accrued liabilities, deferred commissions, ThreatX Protect purchase price allocation and the determination of fair value of stock-based compensation.

These estimates are based on information available as of the date of the consolidated financial statements;

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Leasehold improvements are amortized on a straight-line basis over the shorter of the estimated useful lives of the assets or the remaining lease term.

Remaining amortization terms on leasehold improvements as of December 31, 2024 ranged from approximately one to six years .

Remaining amortization terms on leasehold improvements as of December 31, 2025 ranged from approximately one to three years .

The Company determines if an arrangement is a lease at inception.

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The Company accounts for lease components and non-lease components as a single lease component.

Business Combinations

We use our best estimates and assumptions to allocate the fair value of purchase consideration to the tangible and intangible assets acquired and liabilities assumed based on their estimated fair values.

The excess of the fair value of purchase consideration over the fair values of these identifiable assets and liabilities is recorded as goodwill.

We apply significant judgment in determining the fair value of the intangible assets acquired, which involves the use of significant estimates and assumptions with respect to revenue growth rates, royalty rate and technology migration curve.

While we use our best estimates and judgments, our estimates are inherently uncertain and subject to refinement.

During the measurement period, which may be up to one year from the acquisition date, we may record adjustments to the fair value of these tangible and intangible assets acquired and liabilities assumed, with the corresponding offset to goodwill.

In addition, uncertain tax positions and tax-related valuation allowances are initially established in connection with a business combination as of the acquisition date.

We continue to collect information and reevaluate these estimates and assumptions quarterly and record any adjustments to our preliminary estimates to goodwill provided that we are within the measurement period.

Upon the conclusion of the final determination of the fair value of assets acquired or liabilities assumed during the measurement period, any subsequent adjustments are included in our consolidated statements of operations.

The results of operations for businesses acquired are included in the financial statements from the acquisition date.

Acquisition-related expenses are recognized separately from the business combination and are expensed as incurred.

Goodwill represents the excess of purchase consideration over the fair values of assets acquired and liabilities assumed in a business combination.

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We did not identify impairment of goodwill for any periods presented.

Intangible Assets

Intangible assets with finite lives consist of acquired developed technology, customer relationships, trademarks and trade names acquired through our acquisition of ThreatX Protect.

Intangible assets are recorded at their respective estimated fair values upon acquisition close.

The Company determines the estimated useful lives for acquired intangible assets based on the expected future cash flows associated with the respective asset.

The Company's intangible assets with finite lives are amortized using the straight-line method over their estimated useful lives, ranging from four to five years.

Amortization expense related to acquired developed technology is charged to product cost of revenues.

Amortization expense related to customer relationships, trademarks and trade names is charged to sales and marketing activities.

Amortization expense related to patents and trademarks is charged to general and administrative activities.

The Company evaluates the recoverability of intangible assets periodically by taking into account events or circumstances that may warrant revised estimates of useful lives or that indicate the asset may be impaired.

Impairment of Long-Lived Assets

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If it is determined that an asset group is not recoverable, an impairment loss is recorded in the amount by which the carrying amount of the asset group exceeds its fair value.

In the year ended December 31, 2025, we recorded an impairment charge totaling $ 951 thousand related to an incomplete internally developed software project that will not be completed.

Revenue Recognition

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(i) products revenue, which includes hardware, perpetual software license and subscription offerings, which include term-based license agreements;

and (ii) services revenue, which includes post contract support (“PCS”), professional services, training and software-as-a-service offerings.

and (ii) services revenue, which includes PCS, professional services, training and software-as-a-service offerings.

Revenue for term-based license agreements is recognized at a point in time when the Company delivers the software license to the customer and over time once the subscription term has commenced.

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Our hardware includes embedded ACOS software, which together deliver the essential functionality of our products.

For contracts which contain multiple performance obligations, we allocate revenue to each distinct performance obligation based on the standalone selling price (“SSP”).

For contracts which contain multiple performance obligations, we allocate revenue to each distinct performance obligation based on the SSP.

Judgment is required to determine the SSP for each distinct performance obligation.

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Once a long-term project is available for general release to customers, the accumulated capitalized labor costs associated with that project will begin to be amortized over the expected revenue-generating life of that project and are recorded in cost of sales.

In December 2022, we released the software portion of our first capitalized project and impaired the uncompleted hardware portion that we determined would not generate sufficient revenue to justify the cost of completing it.

When internal-use software that was previously capitalized is abandoned, the cost less the accumulated amortization, if any, is recorded as an operating expense.

In September 2023, we released our second capitalized project after we impaired a portion of it after we determined the full carrying value was not recoverable.

If internal-use software that was previously capitalized is abandoned, the cost less the accumulated amortization, if any, is recorded as an operating expense.

Stock-Based Compensation

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In 2025, 2024 and 2023, sales through a single distribution channel partner represented 29 %, 20 % and 19 % of our total revenue, respectively.

In 2022, sales through two distribution channel partners represented 15 % and 13 % of our total revenue.

Revenues from our significant end-customers as a percentage of our total revenue are as follows:

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Customer A 26 % 15 % 14 %

Customer B * * 13 %

* represents less than 10% of total revenue

As of December 31, 2024, one distribution channel partner accounted for 34 % of our total gross accounts receivable.

As of December 31, 2023, one distribution channel partner accounted for 19 % of our total gross accounts receivable.

We report revenue in two customer verticals:

service providers, which accounted for 60 %, 57 % and 58 % of our total revenue during the years ended December 31, 2025, 2024 and 2023, respectively, and enterprises, which accounted for 40 %, 43 % and 42 % of our total revenue during years ended December 31, 2025, 2024 and 2023, respectively.

A substantial portion of our revenue comes from a limited number of large end-customers and service providers.

Purchases from our ten largest end-customers accounted for 40 %, 38 % and 33 % of our total revenue for the years ended December 31, 2025, 2024 and 2023, respectively.

As of December 31, 2025, a single distribution channel partner accounted for 23 % of our total gross accounts receivable.

As of December 31, 2024, a single distribution channel partner accounted for 34 % of our total gross accounts receivable.

Recent Accounting Standards Not Yet Adopted

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures , which requires public entities, on an annual basis, to provide disclosure of specific categories in the rate reconciliation, as well as disclosure of income taxes paid disaggregated by jurisdiction.

ASU 2023-09 is effective for fiscal years beginning after December 15, 2024, with early adoption permitted.

We are currently evaluating the impact of adopting ASU 2023-09 .

In November 2024, the FASB issued ASU 2024-03 , Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40):

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Recently Adopted Accounting Standard

In November 2023, the Financial Accounting Standards Board, or the FASB, issued Accounting Standards Update, or ASU, 2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures , which requires public entities to disclose information about their reportable segments’ significant expenses and other segment items on an interim and annual basis.

Public entities with a single reportable segment are required to apply the disclosure requirements in ASU 2023-07 , as well as all existing segment disclosures and reconciliation requirements in ASC 280, on an interim and annual basis.

ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and for interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted.

The Company adopted ASU 2023-07 during the year ended December

See Note 11 Segment and Geographic Information in the accompanying notes to the consolidated financial statements for further detail.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

ASU 2023-09 is effective for fiscal years beginning after December 15, 2024, with early adoption permitted.

The Company adopted ASU 2023-09 for its fiscal year ending December 31, 2025.

See Note 12 Income Taxes in the accompanying notes to the consolidated financial statements for further detail.

There have been no other recent accounting pronouncements, changes in accounting pronouncements or recently adopted accounting guidance during the year ended December 31, 2025 that are of significance or potential significance to us.

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Treasury and agency securities 94,148 246 ( 4 ) 94,390 47,865 163 — 48,028

Commercial paper — — — — 998 — — 998

Debt securities $ 100,176 $ 265 $ ( 12 ) 100,429 $ 56,354 $ 8 $ ( 34 ) 56,328

Publicly held equity securities — 5,728

Asset-backed securities 27,419 99 ( 2 ) 27,516 — — — —

Total marketable securities $ 305,981 $ 742 $ ( 9 ) $ 306,714 $ 100,176 $ 265 $ ( 12 ) $ 100,429

During the years ended December 31, 2025 and 2024, the Company did not reclassify any amount to earnings from accumulated other comprehensive income (loss) related to unrealized gains or losses.

During the year ended December 31, 2023, the Company sold certain debt securities at a loss and realized a $ 0.3 million loss.

The Company anticipates that it will recover the entire amortized cost basis of its available-for-sale marketable securities and has determined that no allowance for credit losses was required to be recognized during the years ended December 31, 2025 and 2024.

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Corporate securities $ 12,024 $ ( 3 ) $ — $ — $ 12,024 $ ( 3 )

Treasury and agency securities 13,194 ( 4 ) — — 13,194 ( 4 )

Asset-backed securities 3,348 ( 2 ) — — 3,348 ( 2 )

Total $ 28,566 $ ( 9 ) $ — $ — $ 28,566 $ ( 9 )

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Corporate securities $ 12,516 $ ( 12 ) $ — $ — $ 12,516 $ ( 12 )

Treasury and agency securities 24,304 ( 32 ) — — 24,304 ( 32 )

Total $ 12,516 $ ( 12 ) $ — $ — $ 12,516 $ ( 12 )

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Treasury and agency securities 73,458 20,932 — 94,390 38,025 10,003 — 48,028

Commercial paper — — — — — 998 — 998

Asset-backed securities — 27,516 — 27,516 — — — —

$ 144,597 $ 233,256 $ — $ 377,853 $ 133,154 $ 62,404 $ — $ 195,558

Publicly held equity securities - Level 1 — 5,728

Total $ 195,558 $ 159,300

There were no transfers between Level 1 and Level 2 fair value measurement categories during the years ended December 31, 2025 and 2024.

The Company measures the fair value of the 2030 Notes (as defined in Note 8 Long-Term Debt below) using inputs of quoted prices for disclosure purposes on a recurring basis.

The fair value of the 2030 Notes was $ 232.7 million as of December 31, 2025.

The 2030 Notes are categorized as Level 2 since their fair values is based on Level 2 inputs of quoted prices.

Foreign Exchange Forward Contracts

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The Company does not enter into derivatives for speculative or trading purposes.

The Company enters into foreign exchange forward contracts primarily to mitigate the effect of gains and losses generated by

foreign currency transactions related to certain operating expenses and remeasurement of certain assets and liabilities denominated in foreign currencies.

The Company enters into foreign exchange forward contracts primarily to mitigate the effect of gains and losses generated by foreign currency transactions related to certain operating expenses and remeasurement of certain assets and liabilities denominated in foreign currencies.

For foreign exchange forward contracts not designated as hedging instruments, the fair value of the derivatives in a net gain or net loss position are recorded in prepaid expenses and other current assets in the accompanying consolidated balance sheets.

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The hedging gains and losses in accumulated other comprehensive income (loss) in the consolidated balance sheet are subsequently reclassified to expenses, as applicable, in the consolidated statements of operations in the same period in which the underlying transactions affect the Company’s earnings.

As of December 31, 2024, there were no outstanding foreign exchange forward contracts designated as hedging instruments.

As of December 31, 2023, foreign exchange forward currency contracts designated as hedging instruments had notional amounts of $ 10.8 million.

The Company leases various facilities in the U.S., Asia and Europe under non-cancellable operating lease arrangements that expire on various dates through July 2027.

As of December 31, 2025 and 2024, there were no outstanding foreign exchange forward contracts designated as hedging instruments.

ThreatX Protect Business

In February 2025, we completed an acquisition of the ThreatX Protect business of ThreatX, Inc.

for $ 19.1 million in cash.

This acquisition has been accounted for as a business combination.

The purchase price allocation is as follows:

$ 7.6 million to identified intangible assets, $ 2.5 million to deferred revenue assumed and $ 0.2 million to net assets acquired, with the excess $ 13.8 million of the purchase price over the fair value of net assets acquired recorded as goodwill, allocated to our single operating segment.

Goodwill is primarily attributable to assembled workforce, future synergies, and other intangible assets that do not qualify for separate recognition.

Goodwill is not deductible for tax purposes.

The Company applied the fair value measurement requirements within ASC 820 Fair Value Measurements to evaluate the fair value of identifiable assets acquired and liabilities assumed in connection with its acquisition of ThreatX Protect in February 2025.

The Company estimated fair value and remaining useful life of the intangible assets acquired based on the price that would be received if the Company were to sell the intangible assets in an orderly transaction between market participants.

Intangible assets will be amortized on a straight-line basis over their remaining useful life.

The results of operations of the acquired business, which are not material, have been included in our consolidated financial statements from the date of the acquisition.

Pro forma results of operations have not been presented because the effect of the acquisition was not material to the consolidated statements of operations.

The Company incurred approximately $ 0.3 million of acquisition-related costs, including legal, accounting, and advisory fees.

These costs were expensed as incurred and included in general and administrative expenses in the consolidated statements of operations.

The cash outflows for these costs are classified as operating activities in the consolidated statements of cash flows.

Acquired Intangible Assets

The following table sets forth the components of acquired intangible assets and their estimated useful lives as of the date of acquisition (in thousands, except years):

Fair Value Useful Life (Years)

Developed Technology $ 5,700 5.0

Customer Relationships 1,500 5.0

Trademark / trade name 400 4.0

Total $ 7,600

Intangible assets subject to amortization as of December 31, 2025 are as follows (in thousands, except years):

Gross Accumulated Amortization Net Weighted-Average Remaining Useful Life

Developed technology $ 5,700 $ ( 993 ) $ 4,707 4.1 years

Customer relationships 1,500 ( 261 ) 1,239 4.1 years

Trademark / trade name 400 ( 87 ) 313 3.1 years

$ 7,600 $ ( 1,341 ) $ 6,259

Amortization expense from acquired intangible assets was $ 1.3 million for the year ended December 31, 2025.

The expected future amortization expense for acquired intangible assets as of December 31, 2025 is as follows (in thousands):

Total amortization expense $ 6,259

The Company recorded goodwill in the amount of $ 13.8 million.

There were no events or changes in circumstances that triggered an impairment review of ThreatX Protect goodwill or intangible assets during the year ended December 31, 2025.

The Company leases various facilities in the U.S., Asia and Europe under non-cancellable operating lease arrangements that expire on various dates through April 2028.

These arrangements require the Company to pay certain operating expenses, such as taxes, repairs and insurance, and contain renewal and escalation clauses.

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Total lease costs $ 4,939

Average lease terms and discount rates for the Company’s operating leases were as follows (in thousands):

Average lease terms and discount rates for the Company’s operating leases were as follows:

As of December 31, 2025

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On May 2, 2019, the Company entered into a sublease agreement (the “Sublease”) with Marvell Semiconductor, Inc.

(“Sublandlord”) for its corporate headquarters and research and development space located at 2300 Orchard Parkway, San Jose, California, 95131 (the “Premises”).

(“Sublandlord”) for its corporate headquarters and research and development space located at 2300 Orchard Parkway, San Jose,

California, 95131 (the “Premises”).

The term of the Sublease is approximately eight years and began on December 1, 2019, the date the Company commenced business operations at the Premises.

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Increase (decrease) in allowance ( 232 ) 1,067

Write-offs ( 1,007 ) ( 808 )

Write-offs, net of recoveries ( 167 ) ( 1,007 )

Allowance for credit losses, ending balance $ 66 $ 465

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Accrued tax liabilities 3,247 2,687

Lease liabilities 4,744 4,998

Lease liability 5,562 4,744

Accrued interest payable 1,553 —

Other 7,703 6,207

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Total other non-current liabilities $ 3,848 $ 7,489

Long-Term Debt

2030 Convertible Senior Notes

In March 2025, the Company issued $ 225.0 million aggregate principal amount of 2.75 % Convertible Senior Notes due 2030 (the “2030 Notes”).

The Company received net proceeds from the offering of approximately $ 217.7 million.

The 2030 Notes will mature on April 1, 2030, unless earlier converted, redeemed or repurchased.

The 2030 Notes bear interest at the stated rate of 2.75 % per annum, payable semi-annually in arrears on April 1 and October 1 of each year, beginning on October 1, 2025.

The 2030 Notes are convertible into solely cash, or a combination of cash and shares of common stock, at the Company’s election, at an initial conversion rate of 42.6257 shares of common stock per $1,000 principal amount of 2030 Notes, which is equivalent to an initial conversion price of $ 23.46003 per share of common stock.

The conversion rate is subject to customary adjustments for certain events as described in the indenture governing the 2030 Notes (the “2030 Notes Indenture”).

Special interest and additional interest will accrue on the 2030 Notes in the circumstances and at the rates described in the 2030 Notes Indenture.

The debt issuance costs are amortized to interest expense applying the effective interest method.

The 2030 Notes do not contain financial maintenance covenants.

The holders may convert their 2030 Notes at their option only in the following circumstances:

(1) during any fiscal quarter commencing after the fiscal quarter ended on June 30, 2025, if the last reported sale price per share of the Company’s common stock exceeds 130% of the conversion price for each of at least 20 trading days during the 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter;

(2) during five consecutive business days immediately after any ten consecutive trading day period (such ten consecutive trading day period, the “measurement period”) in which the trading price per $1,000 principal amount of 2030 Notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price per share of Company’s common stock on such trading day and the conversion rate on such trading day;

(3) upon the occurrence of certain corporate events or distributions on the Company’s common stock, as described in the 2030 Notes Indenture;

(4) if the Company calls such 2030 Notes for redemption;

and (5) at any time from, and including, December 1, 2029 until the close of business on the 2nd scheduled trading day immediately before the maturity date.

If the Company undergoes a fundamental change (as defined in the 2030 Notes Indenture), subject to certain conditions, holders may require the Company to repurchase for cash all or any portion of their 2030 Notes, at a fundamental change repurchase price equal to 100% of the principal amount of the 2030 Notes to be repurchased, plus any accrued and unpaid special interest and additional interest, if any, up to, but excluding, the fundamental change repurchase date.

In addition, following certain corporate events or if the Company issues a notice of redemption, it will, under certain circumstances, increase the conversion rate for holders who elect to convert their 2030 Notes in connection with such corporate event or during the relevant redemption period.

The 2030 Notes are redeemable, in whole or in part (subject to certain limitations), for cash at Company’s option at any time, and from time to time, on or after April 5, 2028 and on or before the 60th scheduled trading day immediately before the maturity date, but only if (i) the 2030 Notes are “freely tradable” (as defined in the 2030 Notes Indenture) and all accrued and unpaid additional interest, if any, has been paid in full;

and (ii) the last reported sale price per share of common stock is at least 130% of the conversion price for a specified period of time.

The redemption price will be equal to the principal amount of the 2030 Notes to be redeemed, plus accrued and unpaid special and additional interest, if any, to, but excluding, the redemption date.

The 2030 Notes have customary provisions relating to the occurrence of “events of default” (as defined in the 2030 Notes Indenture).

The occurrence of such events of default may result in the acceleration of all amounts due under 2030 Notes.

The 2030 Notes were not eligible for conversion as of December 31, 2025.

No sinking fund is provided for the 2030 Notes.

The 2030 Notes are general unsecured obligations of the Company and rank senior in right of payment to all of Company’s existing and future indebtedness that is expressly subordinated in the right of payment to the 2030 Notes;

equal in right of payment with all of the Company’s existing and future senior, unsecured indebtedness;

effectively subordinated to any of the Company’s existing and future secured indebtedness to the extent of the value of the collateral securing such indebtedness;

and structurally subordinated to all existing and future indebtedness and other liabilities, including trade payables, and (to the extent the Company is not a holder thereof) preferred equity if any, of the Company’s current or future subsidiaries.

As of December 31, 2025, none of the conditions permitting the holders of the 2030 Notes to convert their notes early had been met.

Therefore, the 2030 Notes are classified as long-term debt.

The Company accounted for the issuance of the 2030 Notes as a single liability measured at its amortized cost, as no embedded features require bifurcation and recognition as derivatives.

The carrying value of the 2030 Notes, net of unamortized debt issuance costs of $ 6.2 million, was $ 218.8 million as of December 31, 2025.

Interest expense related to the amortization of debt issuance costs was $ 5.9 million for the year ended December 31, 2025.

The effective interest rate on the 2030 Notes is 3.43 %.

Commitments and Contingencies

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We make a provision for a liability when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated.

Unless otherwise specifically disclosed in this note, we have determined that no provision for liability nor disclosure is required related to any claim against us because:

(a) there is not a

reasonable possibility that a loss exceeding amounts already recognized (if any) may be incurred with respect to such claim;

Unless otherwise specifically disclosed in this note, we have

determined that no provision for liability nor disclosure is required related to any claim against us because:

(a) there is not a reasonable possibility that a loss exceeding amounts already recognized (if any) may be incurred with respect to such claim;

(b) a reasonably possible loss or range of loss cannot be estimated;

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Total $ 9,155

Rent expense was $ 4.9 million, $ 4.9 million and $ 4.9 million for the years ended December 31, 2024, 2023 and 2022, respectively.

Rent expense was $ 4.9 million for each of the years ended December 31, 2025, 2024 and 2023, respectively.

Guarantees and Indemnifications

31 unchanged sentences

Stock-based compensation by type of award:

Stock options $ — $ — $ —

Stock awards $ 19,012 $ 15,958 $ 12,999

7 unchanged sentences

Total $ 20,030 $ 17,048 $ 14,081

As of December 31, 2024, the Company had $ 32.7 million of unrecognized stock-based compensation expense related to unvested stock-based awards, including ESPP under our Amended 2014 Purchase Plan, which will be recognized over a weighted-average period of 2.5 years.

As of December 31, 2025, the Company had $ 35.2 million of unrecognized stock-based compensation expense related to unvested stock-based awards, including ESPP under the Amended 2014 Purchase Plan, which will be recognized over a weighted-average period of 2.2 years.

Fair Value Determination

21 unchanged sentences

Stock Options

The following tables summarize our stock option activities and related information:

Number of Shares

(thousands) Weighted-Average Exercise Price Per Share Weighted-Average Remaining Contractual Term

(years) Aggregate Intrinsic Value (1)

Outstanding as of December 31, 2023 80 $ 4.63

Exercised ( 77 ) 4.39

Canceled ( 3 ) 12.19

Outstanding as of December 31, 2024 — $ — 0 $ —

Vested and exercisable as of December 31, 2024 — $ — 0 $ —

(1) The aggregate intrinsic value represents the excess of the closing price of our common stock of $ 18.40 as of December 31, 2024 over the exercise price of the outstanding in-the-money options.

No stock options were granted in years ended December 31, 2025, 2024 and 2023.

48 unchanged sentences

Repurchase Agreements

In September 2022, the Company entered into a Common Stock Repurchase Agreement with entities affiliated with Summit Partners whereby the Company purchased 3.5 million shares of common stock for $ 12.75 per share, or an aggregate purchase price of $ 44.6 million.

In November 2024, the Company entered into a Common Stock Repurchase Agreement with entities affiliated with Summit Partners whereby the Company purchased 330 thousand shares of common stock for $ 15.73 per share, or an aggregate purchase price of $ 5.2 million.

1 unchanged sentence

Stock Repurchase Programs

On November 1, 2022, the Company announced its Board of Directors authorized a stock repurchase program of up to $ 50 million of its common stock over a period of twelve months.

On November 7, 2023, the Company announced its Board of Directors had authorized a stock repurchase program under which the Company may repurchase up to $ 50 million of its outstanding common stock over a period of twelve months.

On November 7, 2024, the Company announced its Board of Directors had authorized a new, non-expiring stock repurchase program under which the Company may repurchase up to $ 50 million of its outstanding common stock.

On May 1, 2025, the Company announced its Board of Directors had authorized a new, non-expiring stock repurchase program under which the Company may repurchase up to $ 75 million of its outstanding common stock.

As of December 31, 2025, the Company had $ 53.4 million available to repurchase shares under this program.

12 unchanged sentences

2025 2024 2023

Stock options, RSUs, PSUs and employee stock purchase rights 23 93 94

Stock options, stock awards and employee stock purchase rights 30 23 93

2030 Notes 9,591 — —

Total 9,621 23 93

The geographical breakdown of income before income taxes is as follows (in thousands):

18 unchanged sentences

Provision for income taxes $ 10,285 $ 7,959 $ 3,825

The reconciliation of the statutory federal income taxes and the provision for income taxes is as follows (in thousands, except percentages):

Years Ended December 31,

The reconciliation of the statutory federal income taxes and the provision for income taxes for the year ended December 31, 2025 in accordance with the guidance in ASU 2023-09 is as follows (in thousands, except percentages):

Year ended December 31, 2025

Amount Percentage

Tax at statutory rate $ 11,009 21.0 %

State and local income taxes - net of federal income tax effect(1) 904 1.7

Foreign tax effects:

Withholding tax 1,420 2.7

Foreign rate differential 128 0.2

Effect of cross-border tax laws:

Foreign-derived intangible income deduction ( 3,577 ) ( 6.8 )

Subpart F income and section 78 gross up 99 0.2

R&D tax credits, net of uncertain positions 559 1.1

Foreign tax credits ( 1,540 ) ( 2.9 )

Nontaxable or non deductible items:

Stock-based compensation including 162(m) limitation 1,588 3.0

Changes in unrecognized tax benefits ( 307 ) ( 0.6 )

$ 10,285 19.6 %

Amount Percentage Amount Percentage Amount Percentage

(1) State taxes in Illinois made up the majority (greater than 50%) of the tax effect in this category.

The reconciliation of the statutory federal income taxes and the provision for income taxes for the years ended December 31, 2024 and 2023 in accordance with the guidance prior to the adoption of ASU 2023-09 is as follows (in thousands, except percentages):

Years Ended December 31,

Amount Percentage Amount Percentage

Tax at statutory rate $ 12,201 21.0 % $ 9,197 21.0 %

6 unchanged sentences

Federal tax credits - net of uncertain tax positions ( 3,959 ) ( 6.8 ) % ( 4,047 ) ( 9.2 ) %

Amended return true-up ( 162 ) ( 0.3 ) ( 8 ) — ( 4,176 ) ( 7.9 )

Return to provision true-up ( 162 ) ( 0.3 ) % ( 8 ) — %

Foreign-derived intangible income deduction ( 3,699 ) ( 6.4 ) % ( 3,585 ) ( 8.2 ) %

1 unchanged sentence

Other ( 61 ) ( 0.1 ) % ( 188 ) ( 0.4 ) %

$ 7,959 13.7 % $ 3,825 8.7 % $ 5,808 11.0 %

Provision for income taxes $ 7,959 13.7 % $ 3,825 8.7 %

Cash paid for income taxes (net of refunds) consisted of the following (in thousands):

Federal $ 3,621

State and local 2,087

Foreign 1,069

Cash paid for income taxes (net of refunds) $ 6,777

Individual jurisdictions equaling 5% or more of the total income taxes paid (net of refunds) for the year ended December 31, 2025 include U.S.

Federal for $ 3.6 million, Illinois for $ 1.3 million, Japan for $ 0.5 million and India for $ 0.3 million.

Deferred tax balances are comprised of the following (in thousands):

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The Company believes NOL’s will not expire unused as a result of any Section 382 annual limitations.

Additionally, as of December 31, 2024, we had no U.S.

foreign tax credit carryforwards and, as of December 31, 2023, we had $ 0.4 million of U.S.

Additionally, as of December 31, 2025 and 2024, we had no U.S.

foreign tax credit carryforwards.

4 unchanged sentences

income taxes subject to an adjustment for foreign tax credits and withholding taxes in the various countries.

As of December 31, 2024 and 2023, the

undistributed earnings approximated $ 18.6 million and $ 18.5 million, respectively.

As of December 31, 2025 and 2024, the undistributed earnings approximated $ 21.3 million and $ 18.6 million, respectively.

Our undistributed earnings through December 31, 2017, have been taxed under the one-time transition tax under the Tax Act.

17 unchanged sentences

As of December 31, 2025, the total amount of unrecognized tax benefits, if recognized, that would affect the effective tax rate is $ 4.0 million.

We do not anticipate a material change to our unrecognized tax benefits over the next twelve months.

Unrecognized tax benefits may change during the next twelve months for items that arise in the ordinary course of business.

The Company is subject to taxation in the U.S., various states, and several foreign jurisdictions.

33 unchanged sentences

Participants in the plan may elect to contribute up to $ 23,500 of their annual compensation to the plan for the 2025 calendar year and $24,500 for the 2026 calendar year.

Individuals who are 50 or older may contribute an additional $7,500 of their annual income in both 2024 and 2025.

Individuals who are 50 or older may contribute an additional $7,500 of their annual income for the 2025 calendar year and $8,000 for the 2026 calendar year.

The Company typically matches 50 % of the first 6 % of the employee’s eligible compensation for a maximum employer contribution of $ 2,500 per participant per year.

The Company’s matching contributions totaled $ 1.2 million, $ 1.1 million and $ 1.2 million during the years ended December 31, 2025, 2024 and 2023, respectively.

Subsequent Events

Subsequent Event

On February 4, 2026 , the Company announced its Board of Directors declared a quarterly dividend.

The dividend, in the amount of $ 0.06 per share of common stock outstanding, will be paid on March 3, 2025 , to stockholders of record on February 14, 2025 as a return of capital.

Future dividends will be subject to further review and approval by the Board in

accordance with applicable law.

The dividend, in the amount of $ 0.06 per share of common stock outstanding, will be paid on March 2, 2026 , to stockholders of record on

February 16, 2026 .

Future dividends will be subject to further review and approval by the Board of Directors in accordance with applicable law.

The Board of Directors reserves the right to adjust or withdraw the quarterly dividend in future periods as it reviews the Company’s capital allocation strategy from time to time.

In February 2025, the Company acquired the assets and key personnel of ThreatX Protect, which expanded its cybersecurity portfolio with WAAP protection (web application and application programming interfaces).

The total purchase price was approximately $ 19.5 million and was funded with cash on hand.

The Company is in the process of completing its appraisals of tangible and intangible assets relating to this acquisition and the allocation of the purchase price to the assets acquired and liabilities assumed will be completed once the appraisal process has been finalized.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data