What changed in this filing

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Item 1. Financial Statements

2026-05-07 compared with 2025-11-06 · 251 added, 309 removed, 508 unchanged (52% of the section changed)

3 unchanged sentences

(in thousands)

September 30,

Current assets

16 unchanged sentences

Deferred revenue

Convertible notes

Operating lease liabilities

1 unchanged sentence

Total current liabilities

Convertible notes

Convertible notes, net of current portion - related party

Operating lease liabilities, net of current portion

12 unchanged sentences

(in thousands, except per share amounts)

For the three months ended September 30,

For the nine months ended September 30,

For the three months ended March 31,

Cost of revenue (1)

7 unchanged sentences

Total operating expenses

Loss from operations

Income (loss) from operations

Gain on convertible note extinguishment

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Other expense

Loss before provision for income taxes

Income before provision for income taxes

Provision for income taxes

Basic net loss per share

Shares used to compute basic net loss per share

Net income (loss)

Basic net income (loss) per share

Diluted net income (loss) per share

Shares used to compute basic net income (loss) per share

Shares used to compute diluted net income (loss) per share

(1) Amounts include stock-based compensation expense and associated payroll tax costs, as follows:

For the three months ended September 30,

For the nine months ended September 30,

For the three months ended March 31,

Cost of revenue

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Commerce.com, Inc.

Condensed Consolidated Statements of Comprehensive Loss

Condensed Consolidated Statements of Comprehensive Income (Loss)

(in thousands)

Three months ended September 30,

Nine months ended September 30,

Other comprehensive loss:

Three months ended March 31,

Net income (loss)

Other comprehensive income (loss):

Net unrealized gain on marketable securities

Total comprehensive loss

Total comprehensive income (loss)

The accompanying notes are an integral part of these condensed consolidated financial statements.

1 unchanged sentence

Commerce.com, Inc.

Condensed Consolidated Statements of Stockholders’ Equity

Condensed Consolidated Statements o f Stockholders’ Equity

(in thousands)

For the three and nine months ended September 30, 2025

For the three months ended March 31, 2026

Comprehensive

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Balance at March 31, 2026

Proceeds from exercise of stock options

Release of restricted stock units

Stock-based compensation

Total other comprehensive loss

Balance at June 30, 2025

Proceeds from exercise of stock options

Release of restricted stock units

Stock-based compensation

Total other comprehensive income

Balance at September 30, 2025

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Commerce.com, Inc.

Condensed Consolidated Statements of Stockholders’ Equity

(in thousands)

For the three and nine months ended September 30, 2024

For the three months ended March 31, 2025

Comprehensive

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Balance at March 31, 2025

Proceeds from exercise of stock options

Release of restricted stock units

Issuance of common stock as consideration for an acquisition

Stock-based compensation

Total other comprehensive loss

Balance at June 30, 2024

Proceeds from exercise of stock options

Release of restricted stock units

Stock-based compensation

Total other comprehensive income

Balance at September 30, 2024

The accompanying notes are an integral part of these condensed consolidated financial statements.

3 unchanged sentences

(in thousands)

Three months ended September 30,

Nine months ended September 30,

Three months ended March 31,

Cash flows from operating activities

Adjustments to reconcile net loss to net cash provided by (used in) operating activities:

Net income (loss)

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

Depreciation and amortization expense

1 unchanged sentence

Amortization of premium on convertible notes

Accretion on marketable securities, net

Stock-based compensation expense

Provision for expected credit losses

Real estate and internal-use software charges

Gain on lease modification

Gain on convertible notes extinguishment

9 unchanged sentences

Cash paid for website domain name

Cash paid for acquisition

Purchase of property, equipment, leasehold improvements and capitalized internal-use software

Purchase of capitalized internal-use software, leasehold improvements, and property and equipment

Maturity of marketable securities

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Cash paid for interest

Cash paid for taxes

Cash paid for interest - related party

Noncash investing and financing activities:

Capital additions, accrued but not paid

Fair value of shares issued as consideration for acquisition

Right-of-use asset obtained in exchange for new operating lease liability

Principal amount of 2028 Convertible Notes exchanged

The accompanying notes are an integral part of these condensed consolidated financial statements.

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Notes to Condensed Consolidated Financial Statements

Effective July 31, 2025, BigCommerce Holdings, Inc.

changed its corporate name to Commerce.com, Inc.

(the "Company").

In connection with the corporate name change, the Company's ticker symbol on the Nasdaq Global Market changed from "BIGC" to "CMRC."

The Company is the parent brand behind the BigCommerce, Feedonomics, and Makeswift products, offering integrated, enterprise-grade solutions designed to meet the evolving needs of modern commerce.

The Company provides solutions for businesses to innovate and, grow with an AI-driven commerce ecosystem.

Commerce.com, Inc.

("Commerce," the "Company," "us," "we", or "our") provides an open, intelligent ecosystem of technology solutions designed to support data-centric, distributed, and orchestrated commerce solutions, enabling businesses to manage and utilize product data to deliver seamless, personalized experiences at scale.

Our platform supports a range of business models, including business-to-consumer ("B2C"), business-to-business ("B2B"), and small businesses ("SB") use cases, and is designed to provide the infrastructure necessary to operate online storefronts, manage catalogs and orders, distribute product data, and develop digital content across multiple channels.

The Company is the parent brand behind the BigCommerce, Feedonomics, and Makeswift, and provides an integrated set of enterprise-grade solutions organized across three integrated control planes designed to support the evolving needs of modern commerce.

The Company's platform enables businesses to operate within an increasingly AI-driven commerce ecosystem by supporting product discovery, customer engagement, and transaction execution across a range of digital channels and interfaces.

The Company's mission reflects a multi-product strategy and rebranding to accurately reflect the Company's role as a unified commerce platform.

The Company operates as a global, multi-tenant SaaS infrastructure that enables businesses of all sizes to launch and scale ecommerce operations with lower total cost of ownership and faster time to market.

The Company operates as a data-centric, global, multi-tenant SaaS infrastructure that enables businesses of all sizes to launch and scale ecommerce operations with lower total cost of ownership and faster time to market.

The Company's strategy centers on openness, extensibility, and partner collaboration, distinguishing itself from closed platforms by prioritizing customer choice and aligning with best-in-class providers in payments, fulfillment, ERP, marketing, and other categories to ensure customers can compose the right solution for their business.

The Company believes the future of commerce is modular, intelligent, and user-controlled.

Unless otherwise indicated, all references to the "Company," "us," "we," or "our" in this Quarterly Report on Form 10-Q refer to Commerce.com, Inc., and its consolidated subsidiaries , formerly known as BigCommerce Holdings, Inc.

Summary of significant accounting policies

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The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) for interim financial information.

In the opinion of management, there have been no material changes from the significant accounting policies disclosed in Note 2 of the "Notes to Consolidated Financial Statements" included in our Form 10-K for the fiscal year ended December 31, 2024, filed with the Securities and Exchange Commission (“SEC”) on February 27, 2025 (our "Annual Report").

In the opinion of management, there have been no significant changes from the significant accounting policies disclosed in Note 2 of the "Notes to Consolidated Financial Statements" included in our Form 10-K for the fiscal year ended December 31, 2025 filed with the Securities and Exchange Commission (“SEC”) on March 2, 2026 (our "Annual Report").

The accompanying interim unaudited condensed consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements and include all adjustments, consisting of normal, recurring adjustments, necessary for a fair presentation.

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Accordingly, these interim unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and the accompanying notes in our Annual Report.

The results of operations for the three and nine months ended September 30, 2025, are not necessarily indicative of the results to be expected for the year ending December 31, 2025, or for any other period.

The results of operations for the three months ended March 31, 2026, are not necessarily indicative of the results to be expected for the year ending December 31, 2026, or for any other period.

Basis of consolidation

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The Company’s fiscal year ends on December 31.

References to "fiscal 2025," for example, refer to the fiscal year ending December 31, 2025.

References to "fiscal 2026," for example, refer to the fiscal year ended December 31, 2026.

Use of estimates

The preparation of condensed consolidated financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions.

Significant estimates and assumptions made by management in these consolidated financial statements include:

Significant estimates and assumptions made by management in these condensed consolidated financial statements include:

• the allowance for credit losses;

• constrained revenue;

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• variable consideration for revenue recognition;

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• fair value of certain stock awards issued;

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• valuation of convertible notes;

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Recent Accounting Pronouncements Not Yet Adopted

ASU 2023-09, Income Taxes (Topic 740)

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

Improvements to Income Tax Disclosures.

ASU 2023-09 requires all entities to provide more transparency about income tax information through improvements to income tax disclosures primarily related to the rate reconciliation and income taxes paid information.

The amendments in this update also eliminate requirements such as (1) the disclosure of the nature and estimate of the range of the reasonably possible change in the unrecognized tax benefits balance in the next 12 months, (2) or making a statement that an estimate of the range cannot be made, and (3) the disclosure of the cumulative amount of each type of temporary difference when a deferred tax liability is not recognized because of the exceptions to comprehensive recognition of deferred taxes related to subsidiaries and corporate joint ventures.

Lastly, the amendments in this Update replace the term ‘public entity’ as currently used in Topic 740 with the term ‘public business entity’.

ASU 2023-09 is effective for the Company’s annual periods beginning after December 15, 2024.

The Company does not expect the adoption to have a material impact on the consolidated financial statements.

ASU 2024-03, Disaggregation of Income Statement Expenses (Topic 220)

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The Company is currently assessing the impact this standard will have on the Company's consolidated financial statements.

ASU 2024-04, Induced Conversions of Convertible Debt Instruments (Subtopic 470)

In November 2024, the FASB issued ASU 2024-04,Debt - Debt with Conversion and Other Options (Subtopic 470-20):

Induced Conversions of Convertible Debt Instruments Disclosures.

The amendments in this update are intended to improve relevance and consistency in application of the induced conversion guidance in Subtopic 470-20.

Additionally, the purpose of the update is to clarify the requirements for determining whether certain settlements of convertible debt instruments should be accounted for as induced conversion.

Under the amendments, to account for a settlement of a convertible debt instrument as an induced conversion, an inducement offer is required to provide the debt holder with, at a minimum, the consideration (in form and amount) issuable under the conversion privileges provided in the terms of the instrument.

ASU 2024-04 is effective for the Company's fiscal years beginning after December 15, 2025, and interim periods with those annual reporting periods.

The Company is currently assessing the impact this standard will have on the Company's consolidated financial statements but does not expect it to have a material impact on the consolidated financial statements.

ASU 2025-05, Financial Instruments - Credit Losses (Topic 326)

In July 2025, the FASB issued ASU 2025-05, Financial Instruments - Credit Losses (Topic 326):

Measurement of Credit Losses for Accounts Receivable and Contract Assets.

The amendments in this update provides a practical expedient for measuring expected credit losses on current trade receivables and contract assets by assuming that current conditions remain unchanged over the life of the asset, and for non-public business entities, an accounting policy election to consider subsequent cash collections.

ASU 2025-05 is effective for the Company's fiscal years beginning after December 15, 2025, and interim periods with those annual reporting periods.

ASU 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40)

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ASU 2025-06 requires entities to begin capitalizing software costs when management authorizes and commits to funding the software project, and it is probable that the project will be completed and the software will be used for its intended purpose.

ASU 2025-06 is effective for the Company's fiscal

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years beginning after December 15, 2027, and interim periods with those annual reporting periods.

ASU 2025-06 is effective for the Company's fiscal years beginning after December 15, 2027, and interim periods with those annual reporting periods.

Early adoption is permitted.

The Company is currently assessing the impact this standard will have on the Company's consolidated financial statements.

Other accounting standard updates effective for interim and annual periods beginning after December 31, 2024 are not expected to have a material impact on the Company’s balance sheets, results of operations or cash flows.

The Company empowers businesses to innovate, grow, and thrive by providing open, AI-driven commerce ecosystem.

Commerce.com is the AI-driven parent brand behind three core products of BigCommerce, Feedonomics, and Makeswift.

The Company conducts business as a single operating and reportable segment, which is based upon the Company's current organizational and management structure, as well as information used by the chief operating decisions makers (CODM) to allocate resources and assess company performance.

The Company’s CODM consist of the chief executive officer ("CEO") and the chief financial officer ("CFO") , who review the financial information presented on a consolidated basis for purposes of making operating decisions, allocate resources, and evaluate financial performance.

ASU 2025-11, Interim Reporting (Topic 270):

Narrow-Scope Improvements

In November 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270):

Narrow-Scope Improvements to improve the navigability of required interim disclosures and clarify when applicable.

ASU 2025-11 is not intended to change the fundamental nature of interim reporting or expand or reduce current interim disclosure requirements, but to provide clarity on current interim reporting requirements.

ASU 2025-11 is effective for the Company's fiscal years beginning after December 15, 2027, and interim periods with those annual reporting periods.

Early adoption is permitted.

The Company is currently assessing the impact this standard will have on the Company's condensed consolidated financial statements.

ASU 2025-12, Codification Improvements

In December 2025, the FASB issued ASU 2025-12, Codification Improvements to address suggestions received from stakeholders on the Accounting Standards Codification and to make other incremental improvements to U.S.

The update represents changes to the Codification that (1) clarify, (2) correct errors, and (3) make minor improvements.

ASU 2025-12 is effective for the Company's fiscal years beginning after December 15, 2026, and interim periods with those annual reporting periods.

The Company is currently assessing the impact this standard will have on the Company's consolidated financial statements.

Other accounting standard updates effective for interim and annual periods beginning after December 31, 2025 are not expected to have a material impact on the Company’s financial position, results of operations or cash flows.

The Company provides professional-grade commerce solutions for all types of customers at all stages of their ecommerce growth.

The Company conducts business as a single operating and reportable segment, which is based upon the Company's current organizational and management structure, as well as information used by the chief operating decisions makers (CODMs) to allocate resources and assess company performance.

The Company’s CODM committee is comprised of the chief executive officer (CEO) and the chief financial officer and chief operating officer (CFO and COO).

The Company's CODM committee reviews the financial information presented on a consolidated

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basis for purposes of making operating decisions, allocating resources, and evaluating financial performance.

The accounting policies of the segment are the same as those described in the summary of significant accounting policies in Note 2.

In accordance with ASU 2023-07, Segment Reporting (Topic 280), the Company has determined that net loss, as reported on the consolidated statement of operations, is the key measure of profitability that is required to be reported as it is the measure determined in accordance with measurement principles most consistent with GAAP.

The CODM uses net loss to allocate resources and assess performance which enhances the CODM's ability to compare past financial performance with current financial performance and analyze business performance and trends.

In accordance with ASC 280, the Company concludes that consolidated net loss, as reported on the consolidated statement of operations, is the key measure of profitability that is required to be reported as it is the measure determined in accordance with measurement principles most consistent with GAAP.

The CODMs use net loss to allocate resources and assess performance which enhances the CODMs' ability to compare past financial performance with current financial performance and analyze business performance and trends.

This metric is used when monitoring budget versus actual results, and to assess the performance of the Company's strategic priorities of driving efficient revenue growth.

The significant expenses within net loss on which the CODM relies include those that are reported on the condensed consolidated statements of operations.

The measure of segment assets is reported on the condensed consolidated Balance Sheets as Total assets.

The significant expenses within net loss on which the CODM committee relies include those that are reported on the consolidated statements of operations.

The measure of segment assets is reported on the consolidated Balance Sheets as Total assets.

Accounts receivable

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Billing for revenues relating to the volume of transactions processed by the customer are generally billed a month in arrears, resulting in an unbilled receivable .

The accounts receivable balance at September 30, 2025 and December 31, 2024 included unbilled receivables of $ 12.4 million and $ 15.5 million, respectively.

The accounts receivable balance at March 31, 2026 and December 31, 2025 included unbilled receiv ables of $ 15.7 million, a nd $ 14.3 million, respectively.

The Company assesses the collectability of outstanding accounts receivable on an ongoing basis and maintains an allowance for credit losses for accounts receivable deemed uncollectible.

The Company analyzes grouped customers by similar risk profiles, along with the invoiced accounts receivable portfolio and unbilled accounts receivable for significant risks, historical collection activity, and an estimate of future collectability to determine the amount that the Company will ultimately collect.

This estimate is analyzed annually and adjusted as necessary.

In order to determine the allowance, the Company analyzes grouped customers by similar risk profiles, along with the invoiced accounts receivable portfolio, the age of the outstanding balance and historical write-offs, unbilled accounts receivable for significant risks and historical collection activity.

Additionally, the Company applied the practical expedient related to the estimation of expected credit losses for current accounts receivable and current contract assets.

Identified risks pertaining to the Company’s invoiced accounts receivable include the delinquency level and customer type.

The estimate of the amount of accounts receivable that may not be collected is based on aging of the accounts receivable balances, historical customer delinquency, and assessment of the overall portfolio and general economic conditions.

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The allowance for credit losses consisted of the following:

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Provision for expected credit losses

Recoveries of credit losses

Write-offs recorded against the allowance

Balance at March 31, 2026

Provision for expected credit losses

Write-offs recorded against the allowance

Balance at June 30, 2025

Provision for expected credit losses

Recoveries of credit losses

Write-offs recorded against the allowance

Balance at September 30, 2025

Contract Assets

The Company records a contract asset when revenue recognized on a contract exceeds the billings.

Contract assets are recorded on the condensed consolidated balance sheets at the end of each reporting period in Prepaid expenses and other assets, net of current portion.

Contract assets are recorded on the condensed consolidated balance sheets at the end of each reporting period in Prepaid expenses and other assets, net.

Typically, contract assets arise from agreements that have tiered billings over the contract life, promotional billing periods, and partner and services revenue agreements that include substantive minimums.

Net contract assets wer e $ 2.9 million as of September 30, 2025 as compared to $ 5.0 million as of December 31, 2024.

Net contract assets we re $ 2.2 million a s of March 31, 2026 as compared to $ 2.5 million as of December 31, 2025.

The Company is exposed to credit losses primarily through sales of products and services to customers and partners.

The Company assesses the collectability of outstanding contract assets on an ongoing basis and maintains a reserve which is included in the allowance for credit losses for contract assets deemed uncollectible.

The Company analyzes the contract asset portfolio for significant risks by considering historical collection experience and forecasting future collectability to determine what will ultimately be collected from its customers and partners.

In order to determine the allowance, the Company analyzes the contract asset portfolio for significant risks by considering historical collection experience to determine what will ultimately be collected from its customers and partners.

Delinquency level and customer type have been identified as the primary specific risk affecting the Company’s contract assets.

The estimate for losses is analyzed annually and adjusted as necessary.

The Company has provisioned $ 0.3 million and $ 0.5 million for credit losses related to contract assets as of September 30, 2025 and December 31, 2024, respectively.

The Company applied the practical expedient related to the estimation of expected credit losses for current accounts receivable and current contract assets.

The Company has provisione d $ 0.3 million for credit losses related to contract assets as of March 31, 2026 and December 31, 2025 .

Deferred commissions

The Company capitalizes certain sales commissions earned by the Company's sales and account management teams as these commission payments are considered incremental and recoverable costs of obtaining a contract with a customer.

The Company begins amortizing deferred commissions costs for a particular customer agreement once the revenue recognition criteria are met and amortizes those deferred costs over the expected period of customer benefit.

The Company begins amortizing deferred commissions costs for a particular customer agreement once the revenue recognition criteria are met and

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amortizes those deferred costs over the expected period of customer benefit.

The Company amortizes deferred sales commissions ratably over the customer life which is approximately 3 years.

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Amounts recognized from deferred revenue represent primarily revenue from the sale of subscription solutions, integration, and marketing services.

The Company recogniz ed $ 7.6 million and $ 39.7 million o f previously deferred revenue during the three and nine months ended September 30, 2025.

The Company's deferred revenue balance increased $ 12.6 million as of September 30, 2025, compared to December 31, 2024, which was primarily drive n by timing of annual billing cycles.

The Company recognize d $ 30.4 million of previously deferred revenue during the three months ended March 31, 2026 .

Capitalized Internal-Use Software Costs

The Company capitalizes software costs associated with the development of internal software in accordance with ASC 350-40, Intangibles - Goodwill and Other - Internal-Use Software.

These costs are incurred during the application development phase and meet other requirements for capitalization.

Capitalized software costs are recorded as part of property and equipment, net, and capitalized software costs related to hosting arrangements are recorded within prepaid expenses and other assets within the condensed consolidated balance sheets.

These costs are amortized once placed in service over the useful life, which is generally 36 months.

Revenue Recognition

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Subscription solutions

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Key factors in this determination are historical contract termination rates, general economic factors, and customer specific factors.

Subscription solutions includes revenue from Feedonomics.

Feedonomics provides a AI-based product data feed management platform and related services that enables online retailers and other sellers to automate online listings of the sellers’ information across multiple third-party marketplaces and advertisers.

Subscription solutions include revenue from Feedonomics.

Feedonomics provides an AI-based product data feed management platform and related services that enable online retailers and other sellers to automate online listings of the sellers’ information across multiple third-party marketplaces and advertisers.

The Company provides these services under service contracts which are generally one year or less, and in many cases month-to-month.

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Partner and services

The Company's partner and services revenue includes revenue share, partner technology integrations, and marketing services provided to partners.

Revenue share primarily relates to fees earned by the Company’s partners from customers using the BigCommerce platform, where the Company has an arrangement with such partners to share such fees as they occur.

Revenue share is recognized at the time the earning activity is complete, which is generally monthly and variable based on customer usage.

Revenue for partner technology integrations is recorded on a straight-line basis over the life of the contract commencing when the integration has been completed.

The Company's partner and services revenue include partner technology integrations, marketing services provided to partners, professional services, and revenue share.

Revenue from revenue-sharing arrangements is recognized at the time the earning activity is complete, which is generally monthly and variable based on customer usage.

Revenue from partner technology integration fees is recognized on a straight-line basis over the life of the contract, beginning when the integration is complete.

The Company's most significant partner technology integration offering is BigCommerce Payments, an embedded payment solution.

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Revenue for marketing services are recognized either at the time the earning activity is complete, or ratably over the length of the contract, depending on the nature of the obligations in the contract.

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A performance obligation is a promise in a contract to transfer a distinct good or service to the customer.

Determining whether products and services are considered distinct performance obligations that should be accounted for separately versus together may require significant judgment.

Determining whether products and services are considered distinct performance obligations that should be accounted for separately versus together may require judgment.

The Company’s subscription contracts are generally comprised of a single performance obligation to provide access to the BigCommerce platform, but can include additional performance obligations.

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The primary method used to estimate SSP is the observable prices of products or services sold or priced separately in comparable circumstances to similar customers.

Contracts with the Company’s technology solution partners may include multiple performance obligations, which can include integrations and marketing activities.

Contracts with the Company’s partners may include multiple performance obligations, which can include integrations and marketing activities.

In determining whether integration services are distinct from hosting services the Company considers various factors.

These considerations include the level of integration, interdependency, and interrelation between the implementation and hosting services.

The Company has concluded that the integration services included in contracts with hosting

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obligations are not distinct.

The Company has concluded that the integration services included in contracts with hosting obligations are not distinct.

As a result, the Company defers any arrangement fees for integration services and recognizes such amounts over the life of the hosting obligation commencing when the integration has been completed.

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Remaining performance obligations are subject to future economic risks, including bankruptcies, regulatory changes and other market factors.

The majority of the Company's noncurrent remaining performance obligations are expected to be recognized in the next 13 to 36 months.

One of the Company's strategic partner's contract renewal is reflected in the total remaining performance obligation.

Remaining performance obligation consisted of the following:

(in thousands)

As of September 30, 2025

As of March 31, 2026

As of March 31, 2025

Cost of revenue

Cost of revenue consists primarily of personnel-related costs, including:

stock-based compensation expenses for customer support and professional services personnel;

costs of maintaining and securing infrastructure and platform;

allocation of overhead costs and credit card processing fees;

and amortization expense associated with capitalized internal-use software.

Cost of revenue consists primarily of expenses related to third-party cloud computing and data storage services, personnel-related costs (including stock-based compensation) for customer support and professional services personnel, costs of maintai ning and securing infrastructure and platform, credit card processing fees, allocation of overhead costs, and amortization of capitalized internal-use software.

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Stock-based compensation

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The Company measures the fair value of RSUs based on the closing market price of the common stock on the date of grant.

RSUs ge nerally vest over a four-year period either (i) in equal annual installments, or (ii) 25 percent on the one-year anniversary of the grant date with the remaining 75 percent vesting in equal quarterly installments thereafter, in each case, subject to continued service.

RSUs generally vest over a four-year period either (i) in equal annual installments, or (ii) 25 percent on the one-year anniversary of the grant date with the remaining 75 percent vesting in equal quarterly installments thereafter, in each case, subject to continued service.

Stock-based compensation expense is recognized on a straight-line basis over the requisite service period.

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The market-based awards will cliff-vest at the end of the three-year period ranging from 0 percent to 200 percent of the target number of PSUs granted.

The Company also grants PSUs which provide for shares of common stock to be earned based on its attainment of the Company's adjusted earnings before interest, taxes, depreciation and amortization ("adjusted EBITDA") and revenue relative to a target specified in the applicable agreement, and are referred to as Company performance-based awards.

The Company also grants PSUs to executive officers and other members of senior management which provide for shares of common stock to be earned based on its attainment of the Company's adjusted earnings before interest, taxes, depreciation and amortization (“adjusted EBITDA”) and revenue relative to a target specified in the applicable agreement, and are referred to as Company performance-based awards.

The Company typically values these awards at the closing market price on the date of grant.

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Adjustments to stock-based compensation expense are made, as needed, each reporting period based on changes in our estimate of the number of units that are probable of vesting.

Certain executives have legal rights related to their unvested stock awards through their change in control provision.

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Restructuring charges

Costs to restructure certain internal operations are accounted for as termination and exit costs.

Costs to restructure certain internal operations are accounted for as one-time termination and exit costs.

A liability for a cost associated with restructuring activities is recognized and measured at its estimated fair value in our condensed consolidated balance sheet in the period the liability is incurred.

All costs relating to restructurings are recorded as "Restructuring charges" in the condensed consolidated statement of operations.

The Company recognizes employee severance costs when payments are probable and amounts are estimable or when notification occurs, depending on whether the severance costs paid are part of the Company's general plan.

When estimating the fair value of facility restructuring activities, assumptions are applied regarding estimated sub-lease payments to be received, which can differ materially from actual results.

This may require the Company to revise its initial estimates, which may materially affect the condensed consolidated results of operations and financial position in the period the revision is made.

Costs related to contracts without future benefit or contract termination are recognized at the earlier of the contract termination or the cease-use dates.

Additionally, restructuring charges include considerations of various capital alternatives or changes in business activities which include expenses related to the change in the Company's go-to-market strategy, asset abandonment costs, accelerated depreciation, software impairments, professional services, and other costs.

Capitalized Internal-Use Software Costs

The Company capitalizes software costs associated with the development of internal software in accordance with ASC 350-40, Intangibles - Goodwill and Other - Internal-Use Software.

These costs are incurred during the application development phase and me et other requirements for capitalization.

These costs are amortized once placed in service over the useful life, which is generally 36 months .

Capitalized Interest

The Company capitalizes interest costs in accordance with ASC 835-20, Interest - Capitalization of Interest .

Capitalization of interest applies to qualifying assets that require a period of time to be prepared for their intended use, primarily internal-use software development projects.

Capitalized interest costs related to software development associated with internal-use software are recorded as part of property and equipment, net, and capitalized interest costs related to hosting arrangements are recorded within prepaid expenses and other assets within the condensed consolidated balance sheets.

The amount of interest capitalized is based on the level of expenditures incurred on eligible internal-use software projects during the development stage and the Company's weighted-average borrowing rate during the capitalization period.

Capitalization of interest continues as long as the activities necessary to prepare the asset for its intended use are in progress and ceases when the asset is substantially complete and ready for use.

We recognize employee severance costs when payments are probable and amounts are estimable or when notification occurs depending on whether the severance costs paid are part of an ongoing benefit arrangement.

Costs related to contracts without future benefit or contract terminations are recognized at the earlier of the contract termination or the cease-use dates.

Additionally, restructuring charges include considerations of various capital alternatives or changes in business activities which include expenses related to retention and relocation benefits, accelerated depreciation, professional services, and other costs.

Revenue recognition and deferred costs

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These services allow customers to access the Company’s subscription solutions over the contract period.

The customer is not allowed to take possession of the solutions or transfer the solutions.

The customer is not allowed to take possession of

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the solutions or transfer the solutions.

The Company’s revenue arrangements do not contain general rights of refund in the event of cancellations.

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The following table disaggregates revenue by major source:

Three months ended September 30,

Nine months ended September 30,

Three months ended March 31,

(in thousands)

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Revenue by geographic region was as follows:

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Three months ended September 30,

Nine months ended September 30,

Three months ended March 31,

(in thousands)

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Revenue by geographical region is determined based on the region of the Company’s contracting entity, which may be different than the region of the customer.

Revenue attributed to the United States was approximatel y 76 percent during the three and nine months ended September 30, 2025 and 2024.

Revenue attributed to EMEA was approximately 12 percent for the three and nine months ended September 30, 2025 .

Revenue attributed to EMEA was approximately 12 percent and 11 percent for the three and nine months ended September 30, 2024, respectively.

No single region, other than the United States and EMEA, represented more than ten percent of total revenue during the three and nine months ended September 30, 2025 and 2024.

Revenue attributed to the United States was approximate ly 76 percent d uring the three months ended March 31, 2026 and 2025.

Revenue attributed to EMEA was approximate ly 13 percent and 12 percent f or the three months ended March 31, 2026 and 2025, respectively.

No single region, other than the United States and EMEA, represented more than ten percent of total revenue during the three months ended March 31, 2026 and 2025.

Deferred commissions

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The portion of capitalized costs expected to be amortized during the succeeding twelve-month period is recorded in current assets as deferred commissions, and the remainder is recorded in deferred commissions, net of current portion reflected on the condensed consolidated balance sheets.

The Company did no t recognize an impairment of deferred commissions for the three and nine months ended September 30, 2025 and 2024.

Sales commissions o f $ 1.2 million a nd $ 2.2 million were deferred for the three months ended September 30, 2025 and 2024, respectively;

an d $ 3.4 million a nd $ 7.0 million were deferred for the nine months ended September 30, 2025 and 2024, respectively.

Deferred commission amortization expense wa s $ 2.3 million and $ 2.6 million for the three months ended September 30, 2025 and 2024, respectively;

an d $ 7.4 million an d $ 7.3 million for the nine months ended September 30, 2025 and 2024 , respectively.

The Company did no t recognize an impairment of deferred commissions for the three months ended March 31, 2026 and 2025.

Sales commissions o f $ 0.6 million a nd $ 0.6 million were deferred for the three months ended March 31, 2026 and 2025, respectively;

deferred commission amortization expense w as $ 2.0 million an d $ 2.7 million for the three months ended March 31, 2026 and 2025 , respectively.

Fair value measurements

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When determining fair value, the Company considers the principal or most advantageous market in which it would transact, and assumptions that market participants would use when pricing asset or liabilities.

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The accounting standard for fair value establishes a fair value hierarchy based on three levels of inputs, the first two of which are considered observable and the last unobservable.

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• Level 3 – Inputs are unobservable that are significant to the fair value of the asset or liability and are developed based on the best information available in the circumstances, which might include the Company’s data.

The following table presents information about the Company’s cash equivalents and marketable securities that were measured at fair value as of September 30, 2025 and December 31, 2024:

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As of September 30, 2025

The following table presents information about the Company’s cash equivalents and marketable securities that were measured at fair value as of March 31, 2026 and December 31, 2025:

As of March 31, 2026

(in thousands)

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Marketable securities:

Corporate bonds

treasury securities

Total marketable securities

(1) Included in “Cash and cash equivalents” in the accompanying Condensed Consolidated Balance Sheets, in addition t o $ 45.8 million of cash as of September 30, 2025 .

(1) Included in “Cash and cash equivalents” in the accompanying Condensed Consolidated Balance Sheets, in addition t o $ 57.9 million of cash as of March 31, 2026 .

As of December 31, 2025

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(in thousands)

As of September 30, 2025

As of March 31, 2026

As of December 31, 2025

2 unchanged sentences

Total marketable securities

The following tables summarize the gains, losses, and estimated fair value of cash equivalents, marketable securities as of September 30, 2025 and December 31, 2024:

As of September 30, 2025

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The following tables summarize the gains, losses, and estimated fair value of cash equivalents, marketable securities as of March 31, 2026 and December 31, 2025:

As of March 31, 2026

(in thousands)

3 unchanged sentences

Marketable securities:

Corporate bonds

treasury securities

Total marketable securities

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As of December 31, 2025

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Goodwill amounts are not amortized but tested for impairment on an annual basis or more often when circumstances indicate that goodwill may not be recoverable.

There was no impairment of goodwill for the three and nine months ended September 30, 2025 and 2024.

There was no impairment of goodwill for the three months ended March 31, 2026 and 2025.

Intangible assets are amortized on a straight-line basis over the useful life.

During fiscal 2025, the Company acquired a website domain name for $ 2.4 million.

Intangible assets amortiz ation w as $ 1.9 million and $ 2.4 million for the three months ended September 30, 2025 and 2024, respectively, and was $ 6.8 million a nd $ 7.4 million for the nine months ended September 30, 2025 and 2024, respectively.

There was no impairment of intangible assets for the three and nine months ended September 30, 2025 and 2024.

As of September 30, 2025, expected amortization expense for intangible assets was as follows:

Intangible assets amortizatio n was $ 1.5 million a nd $ 2.3 million for the three months ended March 31, 2026 and 2025, respectively.

There was no impairment of intangible assets for the three months ended March 31, 2026 and 2025.

As of March 31, 2026, expected amortization expense for intangible assets was as follows:

(in thousands)

September 30, 2025

Remaining three months of 2025

Commitments, contingencies, leases, legal proceedings, and defined contribution plan

March 31, 2026

Remaining nine months of 2026

Commitments and contingencies

Legal Proceedings

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These provisions are reviewed at least quarterly and adjusted to reflect the impacts of negotiations, estimated settlements, legal rulings, advice of legal counsel and other information and events pertaining to a particular matter.

The outcomes of legal proceedings and other contingencies are, however, inherently unpredictable and subject to significant uncertainties.

The Company is not presently a party to any legal proceedings that, if

The outcomes of legal proceedings and other contingencies are, however,

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determined adversely to the Company, would have a material adverse effect on the Company's condensed consolidated financial statements or statements of cash flows.

inherently unpredictable and subject to significant uncertainties.

The Company is not presently a party to any legal proceedings that, if determined adversely to the Company, would have a material adverse effect on the Company's condensed consolidated financial statements.

Purchase Obligations

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These commitments are non-cancellable and expire within one to four years .

The Company had unconditional purchase obligations as of September 30, 2025 as follows:

The Company had unconditional purchase obligations as of March 31, 2026 as follows:

(in thousands)

As of September 30, 2025

Remaining three months of 2025

The Company leases or subleases f acilities under operating lease agreements that expire at various dates through 2031 .

As of March 31, 2026

Remaining nine months of 2026

Defined contribution plan

The Company sponsors a tax-qualified 401(k) defined contribution retirement plan for its U.S.

employees (the "Plan").

The Plan allows for eligible employees to participate by contributing a portion of their compensation on a pre-tax basis, subject to annual limits established by the Internal Revenue Service.

The Company matches 50 percent of the first 6 percent of eligible compensation contributed by a participating U.S.

employee to the Plan.

Matching contributions are recognized as compensation expense in the period in which the associated employee services are rendered.

For the three months ended March 31, 2026 and 2025 , the Company recorded $ 0.7 million, respectively, in compensation expense related to employer matching contributions to the retirement plan.

Operating leases, right-of-use assets and lease liabilities

The Company leases or subleases facilities under operating lease agreements that expire at various dates through 2031 .

Some of these arrangements contain renewal options and require the Company to pay taxes, insurance and maintenance costs.

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Renewal options were not included in the right-of-use asset and operating lease liability calculation.

As of September 30, 2025 , there were no finance leases.

There was no impairment recorded for leases for the three and nine months ended September 30, 2025 and 2024.

During fiscal 2025, in connection with the 2024 Restructure (as defined below in Note 7), the Compan y entered into a sublease agreement for approximately 6 years to relocate its Austin headquarters.

The Company is responsible for additional expenses, including taxes, and provided a cash security deposit to the sublessor.

As of March 31, 2026 , there were no finance leases.

There was no impairment recorded for leases for the three months ended March 31, 2026 and 2025.

During fiscal 2025, the Company entered into a sublease agreement for approximately 6 years to relocate its Austin headquarters.

The sublease commenced in March 2025 , and expires on the earlier of January 31, 2031, or two months prior to such earlier date as the Master Lease (as defined in the Sublease) may otherwise expire or terminate.

Operating lease expense w as $ 0.4 million an d $ 0.6 million for the three months ended September 30, 2025 and 2024, respectively, and w as $ 1.0 million and $ 2.0 million for the nine months ended September 30, 2025 and 2024, respectively.

Operating lease expense was $ 0.5 million and $ 0.2 million for the three months ended March 31, 2026 and 2025, respectively.

The future maturities of operating lease liabilities are as f ollows:

(in thousands)

As of September 30, 2025

Remaining three months of 2025

As of March 31, 2026

Remaining nine months of 2026

Total minimum lease payments

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Total lease liabilities

Defined contribution plan

The Company sponsors a tax-qualified 401(k) defined contribution retirement plan for its U.S.

employees (the "Plan").

The Plan allows for eligible employees to participate by contributing a portion of their compensation on a pre-tax basis, subject to annual limits established by the Internal Revenue Service.

As of January 1, 2025, the Company began matching 50 percent of the first 6 percent of eligible compensation contributed by a participating U.S.

employee to the Plan.

Matching contributions are recognized as compensation expense in the period in which the associated employee services are rendered.

For the three and nine months ended September 30, 2025 , the Company recorded $ 0.7 million and $ 2.1 million, respectively, in compensation expense related to employer matching contributions to the Plan.

No expense was recorded in fiscal year 2024 related to employer matching contributions as the employer matching compensation was implemented in the three months ended March 31, 2025.

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Restructuring charges

During fiscal 2024, the Company commenced a restructuring plan (the “2024 Restructure”) intended to reinvest in product delivery and increase sales capacity, to reduce operating costs, improve operating margins and continue to advance the Company's ongoing commitment to profitable growth and rebranding.

During fiscal 2025, the Company committed to a plan (the “2025 Restructure”) to realign the Company’s current workforce with the Company’s on-going cost structure.

The decision to implement the 2025 Restructure is based on continuous improvement efforts

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to optimize operational costs and efficiencies across fiscal 2026 intended to better position the Company for continued profitable revenue growth.

In connection with the 2025 Restructure, restructuring charges are primarily comprised of severance payments, professional services, contract costs, accelerated depreciation of internal use software and other related costs.

Within the condensed consolidated balance sheet, the liability for severance benefits of $ 2.9 million as of the three months ended March 31, 2026 , is recorded to other current liabilities, $ 0.4 million of professional services are recorded in accrued expenses, and $ 0.3 million of contract costs are recorded in accounts payable.

These charges were recorded within Restructuring Charges on the accompanying condensed consolidated statement of operations.

The Company estimates to incur additional costs relating to the 2025 Restructure of approximate ly $ 2.0 million to $ 4.6 million through fiscal 2026 relating to relocation and retention benefits and professional services costs.

The additional expenses the Company expects to incur are subject to assumptions, and actual expenses may differ from the estimates disclosed above.

The following table summarizes the activities related to the 2025 Restructure:

As of September 30, 2025

As of March 31, 2026

As of December 31, 2025

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Workforce reduction

Real Estate and Internal Use Software

Contract Costs and Internal Use Software

Other Restructuring Charges

Workforce reduction

Real Estate and Internal Use Software

Contract Costs and Internal Use Software

Other Restructuring Charges

1 unchanged sentence

Additional charges

Real estate and internal-use software charges

Gain on lease termination

Non-cash items

Liability, end of the period

Within the condensed consolidated balance sheet, the liability for severance benefits are recorded to other current liabilities.

These charges were recorded within Restructuring Charges on the accompanying condensed consolidated statement of operations.

The Company does not expect to incur any additional costs relating to the 2024 Restructure.

Other liabilities

The following table summarizes the components of other liabilities:

As of September 30,

The following table summarizes the components of other current liabilities:

As of March 31,

As of December 31,

(in thousands)

Payroll and payroll related expenses

Accounting & legal professional services

Sales tax payable

Payroll and payroll related expenses

Restructuring related charges

Accrued professional services

Accrued interest

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Fair Value Measurements), are as follows:

As of September 30, 2025

As of March 31, 2026

As of December 31, 2025

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Since the market for trading of the 2026 Convertible Notes is not considered to be an active market, the estimated fair value is based on Level 2 inputs.

The following table presents details of the Company's convertible notes as of September 30, 2025 which are further discussed below:

The following table presents details of the Company's convertible notes as of March 31, 2026 which are further discussed below:

Date of Issuance

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Initial Conversion Price per Share

2028 Convertible Notes

2028 Convertible Notes - related party

2026 Convertible Notes

September 2021

The $ 150.0 million principal amount of the 2028 Convertible Notes is held by a related party, who is an equity holder of the Company.

The total interest expense recognized related to the Company’s convertible notes and financing obligation consists of the following:

Three months ended September 30,

Nine months ended September 30,

Three months ended March 31,

(in thousands)

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The repurchase price will be equal to the principal amount of the 2028 Convertible Notes to be repurchased, plus accrued and unpaid interest, if any, up to, but excluding, the applicable repurchase date.

As of September 30, 2025 , approximately $ 150.0 million aggregate principal amount of 2028 Convertible Notes remain outstanding.

As of March 31, 2026 , approximately $ 150.0 million aggregate principal amount of 2028 Convertible Notes remain outstanding.

The remaining unamortized debt issuance costs are recorded as a contra-liability and are amortized utilizing the effective interest rate of approximately 8 percent over the term of the 2028 Convertible Notes.

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2026 Convertible Notes

As of September 30, 2025 , approximately $ 4.0 million principal amount of 2026 Convertible Notes remain outstanding.

The remaining unamortized debt issuance costs are recorded as a contra-liability and are amortized utilizing the effective interest rate of 0.73 percent over the term of the 2026 Convertible Notes.

In February 2025, the Company entered into separate, privately negotiated repurchase agreements with holders of its outstanding 2026 Convertible Notes to repurchase approximately $ 59.1 million aggregate principal amount of its 2026 Convertible Notes for aggregate cash consideration of approximately $ 54.4 million, including accrued but unpaid interest.

This transaction resulted in a net gain on repurchases of debt of approximately $ 3.9 million, net of $ 0.6 million write-off of unamortized debt issuance costs.

As of March 31, 2026 , approximately $ 4.1 million principal amount of 2026 Convertible Notes remain outstanding.

The remaining unamortized debt issuance costs are recorded as a contra-liability and are amortized utilizing the effective interest rate of 0.73 p ercent over the term of the 2026 Convertible Notes.

The Company is in compliance with the terms of the indenture, and has not experienced any events that would constitute an Event of Default under the 2026 Convertible Notes.

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A total of 3,873,885 shares of common stock were initially authorized and reserved for issuance under the 2020 Plan.

This share reserve automatically increa sed, and will continue to increase, o n each subsequent January 1st through and including January 1, 2031, by an amount equal to the smaller of (a) 5 percent of the number of shares of common stock issued and outstanding on the immediately preceding December 31 and (b) an amount determined by the board of directors.

As of September 30, 2025, a total of 3,052,290 s hares of common stock remain available for future issuance under the 2020 Plan.

This share reserve automatically increased, and will continue to increase, on each subsequent January 1st through and including January 1, 2031, by an amount equal to the smaller of (a) 5 percent of the number of shares of common stock issued and outstanding on the immediately preceding December 31 and (b) an amount determined by the b oard of directors.

On January 1, 2026 and 2025 the share reserve increased by 4,082,622 shares and 3,928,833 shares, respectively.

Stock options

Stock options generally vest and become exercisable over a service period of 4 years from the date of grant, subject to continued service.

The following table summarizes the weighted-average grant date value of options and the assumptions used to develop their fair value.

Nine months ended September 30,

Weighted-average grant date fair value of options

Risk-free interest rate

3.59 % - 4.10 %

Expected volatility

67.66 % - 69.21 %

Expected life in years

5.30 - 6.09 years

The Company estimated its future stock price volatility using a combination of its observed option-implied volatilities and its peer historical volatility calculations.

Management believes this is the best estimate of the expected volatility over the expected life of its stock options.

The estimated life for the stock options is based on the weighted average of the remaining vesting term and the remaining contractual life of each award.

The risk-free interest rate is based on the rate for a U.S.

government security with the same estimated life at the time of the option grant.

The estimated forfeiture rate applied is based on historical forfeiture rates.

The Company does not anticipate paying any cash dividends in the foreseeable future and therefore uses an expected dividend yield of zero in the option pricing model.

The Company has no t granted and does not anticipate granting stock options in fiscal 2026.

(in thousands)

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Balance as of December 31, 2025

Options granted

Stock options granted

Plan shares expired or canceled

Balance as of September 30, 2025

Balance as of March 31, 2026

Vested and expected to vest

Exercisable as of September 30, 2025

The expected stock-based compensation expense remaining to be recognized as of September 30, 2025 is $ 4.4 million related to stock options, which reflects outstanding stock option awards that are vested and outstanding stock option awards that are expected to vest.

This expense will be recognized over a weighted-average perio d of 2.60 years.

Exercisable as of March 31, 2026

At March 31, 2026, there was an estima ted $ 2.7 million of total unrecognized compensation expense related to stock options, which reflects outstanding stock option awards that are vested and outstanding stock option awards that are expected to vest.

This expense will be recognized over a weighted-average period of 2.30 years.

Restricted Stock Units

Restricted stock unit activity for the nine months ended September 30, 2025 was as follows:

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RSU ac tivity for the three months ended March 31, 2026 was as follows:

(in thousands)

Grant Date Fair Value

Weighted Average Grant Date Fair Value

Aggregate Intrinsic Value

Balance as of December 31, 2025

Granted – restricted stock units

Vested and converted to shares

Balance as of September 30, 2025

Balance as of March 31, 2026

Vested and expected to vest

The expected stock-based compensation expense remaining to be recognized as of September 30, 2025 is $ 30.2 million related to RSUs, which reflects outstanding RSUs that are vested and outstanding RSUs that are expected to vest.

The expected stock-based compensation expense remaining to be recognized as of March 31, 2026 is $ 21.8 million related to R SUs, which reflects outstanding RSUs that are vested and outstanding RSUs that are expected to vest.

This expense will be recognized over a weighted-average period of 2.27 years.

Market-based and performance-based restricted stock unit activity for the nine months ended September 30, 2025 was as follows:

Market-based PSU and performance-based PSU activity for the three months ended March 31, 2026 was as follows:

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(in thousands)

Grant Date Fair Value

Weighted Average Grant Date Fair Value

Aggregate Intrinsic Value

Balance as of December 31, 2025

Granted – market-based and performance-based restricted stock units

Change in awards based on performance

Vested and converted to shares

Balance as of September 30, 2025

Balance as of March 31, 2026

Vested and expected to vest

The grant date fair value for the market-based awards was calculated utilizing a Monte Carlo simulation.

Sig nificant assumptions used in the Monte Carlo simulation model for the market-based restricted stock unit awards granted are as follows:

Nine months ended September 30,

The grant date fair value of the market-based awards issued in March was $ 3.29 .

Significant assumptions used in the Monte Carlo simulation model for the market-based PSU aw ards granted are as follows:

Three months ended March 31,

65.71 % - 75.43 %

Risk-free interest rate

4.22 % - 4.31 %

Dividend yield

The expected stock-based compensation expense remaining to be recognized as of September 30, 2025 is $ 2.8 million related to PSUs (performance-based and market-based awards), which reflects outstanding PSUs that are vested and outstanding PSUs that are expected to vest.

The aggregate expected stock-based compensation expense remaining to be recognized as of March 31, 2026 is $ 3.4 million , which reflects market-based and performance-based PSUs that are outstanding and expected to vest.

This expense will be recognized over a weighted-average period of 1.62 years.

The income tax expense for the three and nine months ended September 30, 2025 is based on the estimated annual effective tax rate for fiscal 2025.

The income tax expense for the three months ended March 31, 2026 is based on the estimated annual effective tax rate for fiscal 2026.

The Company’s provision for income taxes is based on estimated effective tax rates derived from an estimate of annual consolidated earnings before taxes, adjusted for nondeductible expenses, other permanent items, valuation allowances, and any applicable income tax credits.

For the three months ended September 30, 2025 and 2024 , the Company’s provision for income taxes reflected an effective tax rate of ( 10.44 ) percent and ( 4.00 ) percent, respectively.

For the nine months ended September 30, 2025 and 2024 , the Company had an effective tax rate of ( 9.55 ) percent and ( 2.89 ) percent, respectively.

For the three and nine months ended September 30, 2025 and 2024, the Company’s effective tax rate was lower than the U.S.

For purposes of calculating income tax expense, the Company continued to maintain a full valuation allowance on our U.S.

federal and state net deferred tax assets as it was more likely than not that those deferred tax assets will not be realized.

However, given the Company's recent net income, in accordance with our policy, the Company will continue to monitor the positive and negative evidence, and will adjust the valuation allowance as sufficient position evidence becomes available.

The exact timing and amount of the valuation allowance release would be subject to change based on the level of profitability that the Company can achieve.

For the three months ended March 31, 2026 , the Company’s provision for income taxes reflected income tax expense of $ 0.5 million on $ 4.2 million of pr e-tax book income for an effective tax rate of approximately 11 percent.

F or the three months ended March 31, 2025, the Company had tax expens e of $ 0.5 million on a pre-tax book income of $ 0.2 million for an effective tax rate of approximately 306 percent.

For the three months ended March 31, 2026, the Company’s effective tax rate was higher than the U.S.

federal statutory rate of 21 percent primarily due to deferred tax expense related to tax amortization of acquired goodwill, changes in the Company’s tax reserves, and movement in the Company’s valuation allowance position.

The Company’s total income tax expense consists primarily of federal and state current income tax expense unable to be offset by tax attributes due to limitations under tax regulations, deferred income tax expense relating to the tax amortization of acquired goodwill, and current income tax expense from foreign operations.

For the three months ended March 31, 2025 , the Company’s effective tax rate was lower than the U.S.

federal statutory rate of 21 percent primarily due to the Company’s valuation allowance offsetting the benefits of losses.

The Company’s total income tax expense consists primarily of deferred income tax expense relating to the tax amortization of acquired goodwill, and current income tax expense from foreign operations.

Operating losses and tax credits generated in years prior to 2020 remain open to adjustment until the statute of limitations closes for the tax year in which the net operating losses are utilized.

Tax years 2020 through 2024 generally remain open to examination by the major taxing jurisdictions to which the Company is subject.

The Company’s total income tax expense consists primarily of state current income tax expense unable to be offset by attributes, deferred income tax expense relating to the tax amortization of acquired goodwill, and current income tax expense from foreign operations.

Operating losses and tax credits generated in years prior to 2022 remain open to adjustment until the statute of limitations closes for the tax year in which the net operating losses are utili zed.

Tax years 2022 through 2025 generally re main open to examination by the major taxing jurisdictions to which the Company is subject.

The Company is currently not under an income tax audit by any taxing jurisdiction.

During the three months ended September 30, 2025, the One Big Beautiful Bill Act ("OBBBA") was enacted in the U.S.

effective July 4, 2025.

The OBBBA includes significant provisions, such as the permanent extension of certain expiring provisions of the Tax

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Cuts and Jobs Act, modifications to the international tax framework and the restoration of favorable tax treatment for certain business provisions.

OBBBA has multiple effective dates, with certain provisions effective in fiscal 2025 and others implemented through fiscal 2027.

The Company accounted for the effects of OBBBA on the Company's tax provision in the three and nine months ended September 30, 2025, which was determined to be immaterial.

While further evaluation is ongoing, the OBBBA is not expected to have a material impact on the Company's balance sheet, statement of operations or cash flows .

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Net loss per share

Basic net loss per share is computed by dividing net loss by the weighted average shares of common stock outstanding for the period.

Because the Company has reported a net loss for the three and nine months ended September 30, 2025, and 2024, the number of shares used to calculate diluted net loss per share is the same as the number of shares used to calculate basic net loss per share for the period presented because the potentially dilutive shares would have been antidilutive if included in the calculation.

Three months ended September 30,

Nine months ended September 30,

Net income (loss) per share

Basic net income (loss) per share is computed by dividing net income (loss) by the number of shares of common stock outstanding for the period.

Diluted net income per share is computed by giving effect to all potential weighted average dilutive common stock, including options and restricted stock units.

The dilutive effect of outstanding awards is reflected in diluted net income per share by application of the treasury stock method.

Three months ended March 31,

(in thousands)

Net income / (loss)

Weighted average shares outstanding

Net loss per share

The following potentially dilutive securities outstanding have been excluded from the computation of basic weighted-average shares outstanding because such securities have an antidilutive impact due to losses reported:

As of September 30,

Effect of dilutive shares (1)

Stock options

Restricted stock units

Performance-based restricted stock units

Weighted average shares outstanding for diluted net income per share

(1) Due to the Company reporting net loss for the three months ended March 31, 2025 , there are no common shares added to calculate diluted EPS because the effect would be anti-dilutive.

The following potentially dilutive securities outstanding have been excluded from the computation of weighted-average shares outstanding for diluted net income per share because the effect would be anti-dilutive:

As of March 31,

(in thousands)

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Restricted stock units

Performance-based restricted stock units

Convertible notes

Total potentially dilutive securities

Subsequent Event

Stockholder Rights Plan

On April 13, 2026 , our Board of Directors approved the adoption of a stockholder rights plan and entered into a Rights Agreement with Equiniti Trust Company, LLC, as Rights Agent, and declared a dividend distribution of one preferred share purchase right on e ach outstanding share of the Company's Common Stock.

Each right will entitle stockholders to buy one one-thousandth of a share of our Series A Junior Participating Preferred Stock at an exercise price of $ 13.00 per one one-thousandth of a share, subject to adjustment.

The dividend was payable to holders of record as of the close of business on April 27, 2026 .

The rights will be exercisable only if a person or group acquires 10% or more (or 20% or more in the case of a Passive Institutional Investor) of our outstanding common stock and various other criteria are met (the “Distribution Date”).

Until the Distribution Date, the rights will not be exercisable;

the rights will not be evidenced by separate rights certificates;

and the rights will be transferable by, and only in connection with, the transfer of common stock.

The rights will expire on April 12, 2027 , unless earlier redeemed or exchanged by the Company.

The adoption did not have a material impact on the Company's condensed consolidated financial statements.

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Special note regarding forward-looking statements

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• anticipated trends and challenges in our business and the markets in which we operate;

• the war involving Russia and Ukraine and the potential impact on our operations, global economic and geopolitical conditions;

• the impacts of changes in U.S.

trade policy and global tariffs;

• the conflicts involving Iran, Israel, and the United States and Russia and Ukraine and the potential impact on our operations, global economic and geopolitical conditions;

• the impacts of changes in United States trade policy and global tariffs;

• our anticipated areas of investments and expectations relating to such investments;

5 unchanged sentences

• our ability to establish and maintain intellectual property rights;

• social, ethical, or regulatory issues involving the development, deployment, and use capabilities of AI;

• our ability to manage expansion into international markets and new industries;

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• our ability to successfully identify, manage, and integrate any existing and potential acquisitions;

• our inability to successfully execute our rebranding initiative;

• our ability to successfully execute our rebranding initiative;

• our ability to adapt to emerging regulatory developments, technological changes, and cybersecurity needs;

1 unchanged sentence

• the anticipated benefits and opportunities related to past and ongoing restructuring may not be realized or may take longer to realize than expected;

• defects or disruptions in our services;

• interruptions or delays in services from third parties;

• customer attrition or our ability to execute renewals;

• our ability to manage key executive succession and retention or continue to attract qualified personnel;

• our ability to implement a go-to-market strategy that focuses on efficient profitable revenue growth, operating leverage, and positive cash flow, may be impacted by unforeseen challenges in streamlining our organization and adapting to market dynamics;

• our ability to remediate the material weakness;

• our ability to implement a go-to-market strategy that focuses on efficient profitable revenue growth, operating leverage, and cash flow, may be impacted by unforeseen challenges in streamlining our organization and adapting to market dynamics;

• other statements described in this Quarterly Report on Form 10-Q under “Risk Factors,” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations”.

Although we believe the expectations reflected in these forward-looking statements are reasonable, these statements are not guarantees of future performance and involve risks and uncertainties which are subject to change based on various important factors, some of which are beyond our control.

For more information regarding these risks and uncertainties as well as certain additional risks that we face, refer to “Risk Factors” in Part I, Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, filed on February 27, 2025 (our "Annual Report") and “Risk Factors,” in this Quarterly Report on Form 10-Q as well as factors more fully described in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and elsewhere in this Quarterly Report on Form 10-Q.

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more fully described in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and elsewhere in this Quarterly Report on Form 10-Q.

If one or more of the factors affecting the expectations reflected in our forward-looking information and statements proves incorrect, our actual results, performance, or achievements could differ materially from those expressed in, or implied by, forward-looking information and statements.

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Factors other than these also could adversely affect our results, and the reader should not consider these factors to be a complete set of all potential risks or uncertainties.

New factors emerge from time to

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time, and management cannot assess the impact of any such factor on our business or the extent to which any factor, or combination of factors, may cause results to differ materially from those contained in any forward-looking statement.

New factors emerge from time to time, and management cannot assess the impact of any such factor on our business or the extent to which any factor, or combination of factors, may cause results to differ materially from those contained in any forward-looking statement.

Any forward-looking statements only speak as of the date of this document, and we undertake no obligation to update any forward-looking information or statements, whether written or oral, to reflect any change, except as required by law.

2 unchanged sentences

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-Q

Item 1. Financial Statements