What changed in this filing

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Item 1. Financial Statements

2023-02-14 compared with 2022-11-14 · 132 added, 97 removed, 421 unchanged (35% of the section changed)

3 unchanged sentences

(in thousands, except par value data)

September 30,

Current assets:

1 unchanged sentence

Restricted cash

Accounts receivable, less allowance for doubtful accounts of $ 206 and $ 123 as of September 30, 2022 and June 30, 2022, respectively

Accounts receivable, less allowance for doubtful accounts of $ 166 and $ 123 as of December 31, 2022 and June 30, 2022, respectively

Costs capitalized to obtain revenue contracts, net

22 unchanged sentences

60,000 shares;

31,937 and 31,930 shares as of September 30, 2022 and June 30, 2022, respectively

32,131 and 31,930 shares as of December 31, 2022 and June 30, 2022, respectively

Additional paid-in capital

9 unchanged sentences

Three Months Ended

September 30,

Six Months Ended

Professional services

9 unchanged sentences

Total operating expenses

(Loss) income from operations

Income (loss) from operations

Interest income

Other income, net

Income before income tax provision

Other income (expense), net

Income (loss) before income tax provision

Income tax provision

Net (loss) income

Per share information:

(Loss) Earnings per share:

Loss per share:

Weighted-average shares used in computation:

1 unchanged sentence

EGAIN CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(in thousands)

Three Months Ended

September 30,

Net (loss) income

Other comprehensive (loss) income, net of taxes:

Six Months Ended

Other comprehensive income (loss), net of taxes:

Foreign currency translation adjustments

Total comprehensive (loss) income

Total comprehensive income (loss)

See accompanying notes to condensed consolidated financial statements.

2 unchanged sentences

(in thousands)

Three Months Ended September 30, 2022

Three Months Ended December 31, 2022

Additional Paid-in

2 unchanged sentences

Total Stockholders'

Balances as of June 30, 2022

Balances as of September 30, 2022

Interest on stockholder notes

Issuance of common stock upon exercise of stock options

Issuance of common stock in connection with employee stock purchase plan

Stock-based compensation

Foreign currency translation adjustments

Balances as of December 31, 2022

Three Months Ended December 31, 2021

Additional Paid-in

Notes Receivable From

Accumulated Other Comprehensive

Total Stockholders'

Balances as of September 30, 2021

Three Months Ended September 30, 2021

Interest on stockholder notes

Issuance of common stock upon exercise of stock options

Issuance of common stock in connection with employee stock purchase plan

Stock-based compensation

Foreign currency translation adjustments

Balances as of December 31, 2021

See accompanying notes to condensed consolidated financial statements.

EGAIN CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (cont.)

(in thousands)

Six Months Ended December 31, 2022

Additional Paid-in

5 unchanged sentences

Issuance of common stock upon exercise of stock options

Issuance of common stock in connection with employee stock purchase plan

Stock-based compensation

Foreign currency translation adjustments

Balances as of September 30, 2021

Balances as of December 31, 2022

Six Months Ended December 31, 2021

Additional Paid-in

Notes Receivable From

Accumulated Other Comprehensive

Total Stockholders'

Balances as of June 30, 2021

Interest on stockholder notes

Issuance of common stock upon exercise of stock options

Issuance of common stock in connection with employee stock purchase plan

Stock-based compensation

Foreign currency translation adjustments

Balances as of December 31, 2021

See accompanying notes to condensed consolidated financial statements.

2 unchanged sentences

(in thousands)

Three Months Ended

September 30,

Six Months Ended

Cash flows from operating activities:

Net (loss) income

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

Adjustments to reconcile net loss to net cash provided by operating activities:

Amortization of costs capitalized to obtain revenue contracts

Amortization of right-of-use assets

Depreciation and amortization

Provision for (Recovery of) doubtful accounts

1 unchanged sentence

Stock-based compensation

Gain on disposal of property and equipment

Changes in operating assets and liabilities:

15 unchanged sentences

Cash flows from financing activities:

Issuance of common stock upon exercise of stock options

Proceeds from exercise of employee stock options

Proceeds from employee stock purchase plan

Net cash provided by financing activities

5 unchanged sentences

Cash paid for taxes

ROU assets and lease liabilities recognized from lease modification

Non-cash items:

5 unchanged sentences

Organization and Nature of Business

eGain Corporation (“eGain”, the “Company”, “our”, “we” or “us”) automates customer engagement with an innovative Software as a Service (SaaS) platform, powered by deep digital, Artificial Intelligence (AI), and knowledge capabilities.

We sell mostly to large enterprises across financial services, telecommunications, retail, government, healthcare, and utilities.

That is, organizations seeking to better serve customers at scale while coping with content silos, process complexity, and regulatory compliance.

eGain automates customer engagement with an innovative knowledge hub, powered by conversational AI and analytics.

We sell mostly to large enterprises across financial services, telecommunications, retail, government, healthcare, and utilities seeking to better serve customers at scale while coping with content silos, process complexity, and regulatory compliance.

With our mantra of AX + BX + CX = DX™ , we guide clients to effortless digital experience (DX) by holistically optimizing agent experience (AX), business experience (BX) and customer experience (CX).

1 unchanged sentence

We are headquartered in the United States.

We also operate in United Kingdom and India.

We also operate in the United Kingdom and India.

Our fiscal year ends on June 30.

1 unchanged sentence

Basis of Presentation

The accompanying condensed consolidated balance sheet as of September 30, 2022 and the condensed consolidated statements of operations, comprehensive (loss) income, stockholders’ equity, and cash flows for the three months ended September 30, 2022 and 2021, are unaudited.

The accompanying condensed consolidated balance sheet as of December 31, 2022 and the condensed consolidated statements of operations, comprehensive income (loss), stockholders’ equity, and cash flows for the three and six months ended December 31, 2022 and 2021, are unaudited.

The condensed consolidated balance sheet as of June 30, 2022 was derived from audited consolidated financial statements as of that date but does not include all the information and footnotes required by GAAP for complete financial statements.

39 unchanged sentences

Topic 326 requires a modified retrospective approach by recording a cumulative-effect adjustment to retained earnings as of the beginning of the period of adoption.

While the Company is currently evaluating the impact of Topic 326, the Company does not expect the adoption of this ASU to have a material impact on its consolidated financial statements or the related disclosure.

While the Company is currently evaluating the impact of Topic 326, the Company does not expect the adoption of this ASU to have a material impact on its condensed consolidated financial statements or the related disclosure.

Revenue Recognition

8 unchanged sentences

With respect to our business, a performance obligation is a promise to transfer a service to a customer that is distinct.

Significant judgment is required to determine whether services are distinct

performance obligations that should be accounted for separately or combined as one unit of accounting.

Significant judgment is required to determine whether services are distinct performance obligations that should be accounted for separately or combined as one unit of accounting.

Additionally, significant judgment is required to determine the timing of revenue recognition.

16 unchanged sentences

● Maintenance and support arrangements;

● Term license subscriptions which incorporate on-premise software licenses and substantial cloud functionality that are not distinct in the context of our arrangements are considered highly interrelated and represent a single combined performance obligation.

● Term licenses which incorporate on-premise software licenses and a subscription to substantial cloud functionalities.

For contracts involving distinct software licenses, the license performance obligation is satisfied at a point in time when control is transferred to the customer.

8 unchanged sentences

customer and payment for that good or service by the customer is expected to be one year or less.

The Company assessed its revenue contracts in order to determine whether a significant financing component exists, and determined its contracts did not include a significant financing component for the periods ended September 30, 2022 and 2021.

Professional Services Revenue

20 unchanged sentences

Amortization of costs to obtain revenue contracts is included as a component of sales and marketing expenses in our condensed consolidated statements of operations.

During the three months ended September 30, 2022 and 2021, we capitalized $ 191,000 and $ 646,000 of costs to obtain revenue contracts, respectively, and amortized $ 375,000 and $ 356,000 to sales and marketing expense, respectively.

Capitalized costs to obtain revenue contracts, net were $ 4.3 million and $ 4.6 million as of September 30, 2022 and June 30, 2022, respectively, on our condensed consolidated balance sheets.

During the three and six months ended December 31, 2022, we capitalized $ 218,000 and $ 409,000 of costs to obtain revenue contracts, respectively, and amortized $ 395,000 and $ 770,000 to sales and marketing expense, respectively.

During the three and six months ended December 31, 2021, we capitalized $ 769,000 and $ 1.4 million of costs to obtain revenue contracts, respectively, and amortized $ 376,000 and $ 732,000 to sales and marketing expense, respectively.

On our condensed consolidated balance sheets, capitalized costs to obtain revenue contracts, net, were $ 4.3 million and $ 4.6 million as of December 31, 2022 and June 30, 2022, respectively.

Short-term capitalized costs to obtain revenue contracts, were $ 1.4 million and $ 1.5 million as of December 31, 2022 and June 30, 2022, respectively.

Long-term capitalized costs to obtain revenue contracts, were $ 2.8 million and $ 3.1 million as of December 31, 2022 and June 30, 2022, respectively.

Deferred Revenue

11 unchanged sentences

The Company operates in one operating segment and all required financial segment information can be found in the condensed consolidated financial statements.

Our sales are derived from North America and combined Europe, Middle East, and Africa and is disclosed in Note 2.

Our revenue is derived from North America and combined Europe, Middle East, and Africa and is disclosed in Note 2.

However, we incur operating expenses in the North America, combined Europe, Middle East, and Africa, and Asia Pacific regions.

The following table presents our (loss) income from operations among our three operating regions (in thousands):

The following table presents our income (loss) from operations among our three operating regions (in thousands):

Three Months Ended

September 30,

(Loss) income from operations:

Six Months Ended

Income (loss) from operations:

North America

Europe, Middle East, & Africa

(Loss) income from operations

Income (loss) from operations

The following table presents our long-lived assets, corresponding to our geographic areas are as follows (in thousands):

September 30,

Long-lived assets:

5 unchanged sentences

Our financial instruments that are exposed to concentrations of credit risk include cash and cash equivalents and accounts receivable.

One customer, who is also our partner, accounted for 24 % of total revenue during the three months ended September 30, 2022.

Two customers, who are also our partners, accounted for 24 % and 13 %, respectively, of total revenue during the three months ended September 30, 2021.

Three and two different customers accounted for more than 10% of our gross accounts receivable balance as of September 30, 2022 and 2021, respectively.

Two customers, one of which is a partner, accounted for 19 % and 10 %, respectively, of total revenue during the three months ended December 31, 2022.

The same partner accounted for 21 % of total revenue during the six months ended December 31, 2022.

The same partner and a different customer, accounted for 23 % and 12 %, respectively, of total

revenue during the three months ended December 31, 2021 and 23 % and 12 %, respectively, for the six months ended December 31, 2021.

One customer accounted for more than 10% of our gross accounts receivable balance as of December 31, 2022.

Accounts Receivable and Allowance for Doubtful Accounts

2 unchanged sentences

We also maintain an allowance for doubtful accounts to reserve for potential uncollectible trade receivables.

We review our trade receivables by aging category to identify specific customers with

known disputes or collectability issues.

We review our trade receivables by aging category to identify specific customers with known disputes or collectability issues.

We exercise judgment when determining the adequacy of these reserves as we evaluate historical bad debt trends, general economic conditions in the U.S.

6 unchanged sentences

Unbilled accounts receivables are recorded when revenue recognized on the contract exceeds billings, pursuant to contract provisions, and become billable upon certain criteria being met.

Unbilled accounts receivables, for which the Company has the unconditional right to consideration, totaled $ 692,000 and $ 770,000 as of September 30, 2022, and June 30, 2022, respectively, and are included in the accounts receivable balance on the accompanying condensed consolidated balance sheets.

Unbilled accounts receivables, for which the Company has the unconditional right to consideration, totaled $ 676,000 and $ 770,000 as of December 31, 2022, and June 30, 2022, respectively, and are included in the accounts receivable balance on the accompanying condensed consolidated balance sheets.

Stock-Based Compensation

9 unchanged sentences

Three Months Ended

September 30,

Six Months Ended

Stock-based compensation expense:

4 unchanged sentences

Total stock-based compensation expense

Total stock-based compensation includes expense related to non-employee awards of $ 44,000 and $ 55,000 during the three months ended September 30, 2022, and 2021, respectively.

Total stock-based compensation includes expense related to the ESPP of $ 127,000 and $ 132,000 for the three months ended September 30, 2022, and 2021, respectively.

Total stock-based compensation includes expense related to non-employee awards of $ 38,000 and $ 82,000 during the three and six months ended December 31, 2022, respectively.

Total stock-based compensation includes expense related to non-employee awards of $ 75,000 and $ 130,000 during the three and six months ended December 31, 2021, respectively.

Total stock-based compensation includes expense related to the ESPP of $ 63,000 and $ 190,000 for the three and six months ended December 31, 2022, respectively.

Total stock-based compensation includes expense related to the ESPP of $ 93,000 and $ 225,000 for the three and six months ended December 31, 2021, respectively.

We utilize the Black-Scholes valuation model for estimating the fair value of the stock-based compensation of options granted.

All shares of our common stock issued pursuant to our stock option plans are only issued out of an authorized

reserve of shares of common stock which were previously registered with the SEC on Registration Statements on Form S-8.

During the three months ended September 30, 2022 and 2021, we granted options to purchase 100,867 and 2,950,560 shares of common stock with a weighted-average fair value of $ 5.04 and $ 7.30 per share, respectively.

All shares of our common stock issued pursuant to our stock option plans are only issued out of an authorized reserve of shares of common stock which were previously registered with the SEC on Registration Statements on Form S-8.

During the three months ended December 31, 2022 and 2021, we granted options to purchase 53,200 and 241,379 shares of common stock with a weighted-average fair value of $ 4.32 and $ 5.78 per share, respectively.

During the six months ended December 31, 2022 and 2021, we granted options to purchase 154,067 and 3,191,939 shares of common stock with a weighted-average fair value of $ 4.79 and $ 7.19 per share, respectively.

We used the following assumptions:

Three Months Ended

September 30,

Six Months Ended

Expected volatility

6 unchanged sentences

Treasury Strips rate with maturities approximating the expected lives of the awards during the period, which approximate the rate in effect at the time of the grant.

On June 1, 2022 and 2021, employees were granted the right to purchase an aggregate of 97,982 and 80,018 shares under the ESPP, respectively.

As of September 30, 2022, there were 1,097,360 shares of common stock available for issuance under the ESPP.

On December 1, 2022, employees were granted the right to purchase an aggregate of 88,414 shares under the ESPP, and compensation expense related to those purchase rights for the three and six months ended December 31, 2022 was $ 41,000 .

On December 1, 2021, employees were granted the right to purchase an aggregate of 86,928 shares under the ESPP, and compensation expense related to those purchase rights for the three and six months ended December 31, 2021 was $ 47,000 .

As of December 31, 2022, there were 1,025,112 shares of common stock available for issuance under the ESPP.

We base our estimate of expected life of a stock option on the historical exercise behavior and cancellations of all past option grants made by the Company during the time period which its equity shares have been publicly traded, the contractual term of the option, the vesting period and the expected remaining term of the outstanding options.

1 unchanged sentence

Improvements to Employee Share-Based Accounting , we elected to continue to estimate forfeitures in the calculation of stock-based compensation expense.

As of September 30, 2022 there was approximately $ 9.4 million of total unrecognized compensation cost, net of expected forfeitures, related to unvested stock options, which is expected to be recognized over the weighted-average period of 1.5 years.

There were 7,225 and 156,170 options exercised during the three months ended September 30, 2022 and 2021 , respectively.

As of December 31, 2022 there was approximately $ 7.5 million of total unrecognized compensation cost, net of expected forfeitures, related to unvested stock options, which is expected to be recognized over the weighted-average period of 1.4 years.

There were 121,936 and 41,309 options exercised during the three months ended December 31, 2022 and 2021 , respectively.

There were 129,161 and 197,479 options exercised during the six months ended December 31, 2022 and 2021, respectively.

Lease agreements are evaluated to determine whether an arrangement is or contains a lease in accordance with ASC 842, Leases .

5 unchanged sentences

If the rate implicit in the lease cannot be readily determined, the Company uses its incremental borrowing rate at lease commencement.

The operating lease ROU assets are calculated as the present value of the

remaining lease payments plus unamortized initial direct costs and any prepayments, less unamortized lease incentives received.

The operating lease ROU assets are calculated as the present value of the remaining lease payments plus unamortized initial direct costs and any prepayments, less unamortized lease incentives received.

Operating leases typically include non-lease components such as common-area maintenance costs.

9 unchanged sentences

These events or circumstances could include a significant change in the business climate, legal factors, operating performance indicators, competition, or sale or disposition of a significant portion of a reporting unit.

We operate under a single reporting unit and accordingly, all of our goodwill is associated with the entire company.

We had no indicators of impairment during the three months ended September 30, 2022.

under a single reporting unit and accordingly, all of our goodwill is associated with the entire company.

We had no indicators of impairment during the three and six months ended December 31, 2022.

REVENUE RECOGNITION

Disaggregation of Revenue

The following table presents our subscription and professional services revenue during the three months ended September 30, 2022 and 2021, respectively (in thousands):

The following table presents our subscription and professional services revenue during the three and six months ended December 31, 2022 and 2021, respectively (in thousands):

Three Months Ended

September 30,

Six Months Ended

Legacy revenue

2 unchanged sentences

Total revenue

The following table presents our revenue recognized over-time and at a point-in-time during the three months ended September 30, 2022 and 2021, respectively (in thousands):

The following table presents our revenue recognized over-time and at a point-in-time during the three and six months ended December 31, 2022 and 2021, respectively (in thousands):

Three Months Ended

September 30,

Six Months Ended

Point-in-time

2 unchanged sentences

Revenue by geography is generally determined on the region of our contracting entity rather than the region of our customer.

The relative proportion of our total revenue between each geographic region as presented in the table below was materially consistent across each of our operating regions’ revenue for the periods presented.

Three Months Ended

September 30,

Six Months Ended

North America

3 unchanged sentences

Contract assets, if any, consist of unbilled receivables for completed performance obligations which have not been invoiced, and for which we do not have an unconditional right to consideration.

Contract liabilities consist of deferred revenue for which we have an obligation to transfer services to customers and have received consideration in advance or the amount is due from customers.

Contract liabilities consist of deferred

revenue for which we have an obligation to transfer services to customers and have received consideration in advance or the amount is due from customers.

Once the obligations are fulfilled, then deferred revenue is recognized to revenue in the respective period.

There were no contract assets as of September 30, 2022, on our condensed consolidated balance sheets.

The following table presents the contract liabilities (in thousands):

Balance as of June 30, 2022

Balance as of September 30, 2022

There were no contract assets as of December 31, 2022, on our condensed consolidated balance sheets.

The following table presents our contract liabilities (in thousands):

December 31, 2022

June 30, 2022

Contract liabilities:

1 unchanged sentence

Deferred revenue, net of current portion

$ 14.4 million of deferred revenue as of June 30, 2022 was recognized to revenue during the three months ended September 30, 2022.

Total deferred revenue includes additions and deductions of $ 25.0 million for the three months ended September 30, 2022.

$ 11.0 million and $ 25.4 million of deferred revenue as of June 30, 2022 was recognized to revenue during the three and six months ended December 31, 2022, respectively.

Total deferred revenue includes additions of $ 21.9 million and deductions of $ 26.6 million for the three months ended December 31, 2022.

Total deferred revenue includes additions of $ 46.9 million and deductions of $ 51.6 million for the six months ended December 31, 2022.

Deductions consist of revenue recognized from beginning of period and impact of foreign currency translation.

2 unchanged sentences

The transaction price allocated to the remaining performance obligation is influenced by a variety of factors, including seasonality, timing of renewals, average contract terms and foreign currency exchange rates.

As of September 30, 2022, our remaining performance obligations were $ 94.5 million of which we expect to recognize $ 67.2 million and $ 27.3 million as revenue within one year and beyond one year, respectively.

(LOSS) EARNINGS PER SHARE

Basic net (loss) income per share is computed using the weighted-average number of shares of common stock outstanding.

As of December 31, 2022, our remaining performance obligations were $ 92.1 million of which we expect to recognize $ 56.5 million and $ 35.6 million as revenue within one year and beyond one year, respectively.

LOSS PER SHARE

Basic net loss per share is computed using the weighted-average number of shares of common stock outstanding.

In periods where net income is reported, the weighted-average number of shares is increased by stock options in the money to calculate diluted net income per share.

The following table represents the calculation of basic and diluted net (loss) income per share (unaudited, in thousands, except per share data):

The following table represents the calculation of basic and diluted net loss per common share (in thousands, except per share data):

Three Months Ended

September 30,

Net (loss) income

Six Months Ended

Per share information:

(Loss) Earnings per share:

Loss per share:

Weighted-average shares used in computation:

Effect of dilutive options

Weighted-average shares of stock options to purchase 3,707,271 and 1,372,400 shares of common stock for the three months ended September 30, 2022 and 2021, respectively, were not included in the computation of diluted net (loss) income per share due to their anti-dilutive effect.

Weighted-average shares of stock options to purchase 3,628,963 and 3,326,313 shares of common stock for the three months ended December 31, 2022 and 2021, respectively, and weighted-average shares of stock options to purchase 3,658,692 and 2,349,356 shares of common stock for the six months ended December 31, 2022 and 2021, respectively,

were not included in the computation of diluted net loss per share due to their anti-dilutive effect.

Such securities could have a dilutive effect in future periods.

11 unchanged sentences

We consider many factors when evaluating and estimating tax positions and tax benefits, which may require periodic adjustments and which may not accurately anticipate actual outcomes.

As of September 30, 2022, utilization of the NOL or tax credit carryforwards to offset future taxable income and taxes, respectively, are subject to an annual limitation under the Internal Revenue Code of 1986 and similar state provisions, which is determined by first multiplying the value of the Company’s stock at the time of the ownership change by the applicable long-term, tax-exempt rate, and then could be subject to additional adjustments such as built in gain or built in loss, as required.

As of December 31, 2022, utilization of the NOL or tax credit carryforwards to offset future taxable income and taxes, respectively, are subject to an annual limitation under the Internal Revenue Code of 1986 and similar state provisions, which is determined by first multiplying the value of the Company’s stock at the time of the ownership change by the applicable long-term, tax-exempt rate, and then could be subject to additional adjustments such as built in gain or built in loss, as required.

Any limitation may result in expiration of all or a portion of its NOL and or tax credit carryforwards before utilization.

As of September 30, 2022, the Company did not identify any ownership change that would significantly limit the net operating loss carryovers.

As of December 31, 2022, the Company did not identify any ownership change that would significantly limit the net operating loss carryovers.

The 2017 Tax Cuts and Jobs Act includes a provision to tax global intangible low-taxed income (GILTI) of foreign subsidiaries.

As of September 30, 2022, we estimate $ 2.2 million of GILTI will be an addback for fiscal year 2023.

As of December 31, 2022, we estimate $ 7.9 million GILTI will be an addback for fiscal year 2023.

On August 16, 2022, the Inflation Reduction Act of 2022 (IRA) was signed into law and is effective for taxable years beginning after December 31, 2022.

6 unchanged sentences

As our leases do not provide an implicit rate, we use our incremental borrowing rate based on information available at the commencement date to determine the present value of lease payments.

Total operating lease costs were $ 321,000 and $ 366,000 for the three months ended September 30, 2022 and 2021, respectively.

For the three months ended September 30, 2022, and 2021, operating cash outflows for operating leases were $ 298,000 and $ 460,000 , respectively.

Total operating lease costs were $ 315,000 and $ 331,000 for the three months ended December 31, 2022 and 2021, respectively.

Total operating lease costs were $ 636,000 and $ 698,000 for the six months ended December 31, 2022 and 2021, respectively.

For the three and six months ended December 31, 2022, operating cash outflows for operating leases were $ 295,000 and $ 593,000 , respectively.

For the three and six months ended December 31, 2021, operating cash outflows for operating leases were $ 460,000 and $ 918,000 , respectively.

The following tables present information about leases on our condensed consolidated balance sheets (in thousands):

September 30,

Operating lease right-of-use assets

2 unchanged sentences

The following table presents information about the weighted average lease term and discount rate as follows:

As of September 30, 2022

As of December 31, 2022

As of June 30, 2022

1 unchanged sentence

Weighted average discount rate

As of September 30, 2022, remaining maturities of lease liabilities are as follows (in thousands):

As of December 31, 2022, remaining maturities of lease liabilities are as follows (in thousands):

Fiscal Period:

Remaining nine months of fiscal 2023

Remaining six months of fiscal 2023

Total minimum lease payments

1 unchanged sentence

COMMITMENTS AND CONTINGENCIES

In the ordinary course of business, we are involved in various legal proceedings and claims related to alleged infringement of intellectual property rights, commercial, corporate and securities, labor and employment, wage and hour, and other claims that are not expected to have a material impact on our business or our consolidated financial statements.

We have been, and may in the future be, put on notice and/or sued by third parties for alleged infringement of their proprietary rights, including patent infringement.

31 unchanged sentences

Our money market funds are measured at fair value on a recurring basis based on quoted market prices in active markets and are classified as level 1 within the fair value hierarchy.

As of September 30, 2022 and June 30, 2022, cash equivalents classified as level 1 instruments, including money market account investments, were measured at $ 57.5 million and $ 57.9 million, respectively.

SUBSEQUENT EVENT

As of December 31, 2022 and June 30, 2022, cash equivalents classified as level 1 instruments, including money market account investments, were measured at $ 58.6 million and $ 57.9 million, respectively.

SHARE REPURCHASE PROGRAM

On November 14, 2022, the Board of Directors authorized a stock repurchase program under which we may purchase up to $ 20 million of our outstanding common stock.

4 unchanged sentences

The stock repurchase program will be funded using existing cash or future cash flows.

As of December 31, 2022, no shares have been repurchased.

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