What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2026-02-25 compared with 2025-02-26 · 334 added, 411 removed, 902 unchanged (45% of the section changed)

15 unchanged sentences

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

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 25, 2025, expressed an adverse opinion on the Company’s internal control over financial reporting because of a material weakness.

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

Basis for Opinion

14 unchanged sentences

Critical Audit Matter Description

Revenue is recognized upon transfer of control of promised products or services to customers in an amount that reflects the consideration the Company expects to receive in exchange for those products or services.

Revenue is recognized upon transfer of control of promised services to customers in an amount that reflects the consideration the Company expects to receive in exchange for those services.

The processing and recording of certain revenue requires a manual process, and therefore the Company uses a complex set of procedures to generate complete and accurate data to record its revenue transactions.

25 unchanged sentences

Intangible assets, net 25,771 42,876

Marketable securities, non-current — 6,088

Other assets 57,789 68,402

4 unchanged sentences

Accrued expenses 70,669 41,622

Long-term debt, current

Finance lease liabilities, current — 2,328

Operating lease liabilities, current 24,427 25,155

Deferred revenue 35,234 26,511

Other current liabilities 7,499 2,796

Total current liabilities 193,998 104,456

Long-term debt 337,614 343,507

Finance lease liabilities, non-current — 1,602

Long-term debt, net

323,282 337,614

Operating lease liabilities, non-current 43,921 39,561

3 unchanged sentences

Stockholders’ equity:

Common stock, $ 0.00002 par value;

Class A common stock, $ 0.00002 par value;

1,000,000,000 shares authorized as of both December 31, 2025 and 2024;

151,537,271 and 142,086,129 shares issued and outstanding at December 31, 2025 and 2024, respectively

Class B common stock, $ 0.00002 par value;

4,191,275 shares authorized as of both December 31, 2025 and 2024;

no shares issued and outstanding as of both December 31, 2025 and 2024

Additional paid-in capital 2,044,103 1,958,157

38 unchanged sentences

Net loss $ ( 121,677 ) $ ( 158,058 ) $ ( 133,088 )

Other comprehensive loss:

Other comprehensive income:

Foreign currency translation adjustment

Gain (loss) on investments in available-for-sale-securities

908 7,713 ( 6,404 )

Total other comprehensive income (loss)

Unrealized gain on investments in available-for-sale-securities

Total other comprehensive income

$ 59 $ 908 $ 8,278

5 unchanged sentences

Comprehensive

Income (Loss) Accumulated

Deficit Total

2 unchanged sentences

Balance as of December 31, 2022 124,336 $ 2 $ 1,666,106 $ ( 9,286 ) $ ( 701,664 ) $ 955,158

118,811 $ 2 $ 1,527,468 $ ( 2,627 ) $ ( 510,890 ) $ 1,013,953

Exercise of vested stock options 291 — 2,169 — — 2,169

Vesting of restricted stock units 6,150 1 — — — 1

Issuance of restricted stock awards 112 — — — — —

Shares issued under bonus program 1,193 — 16,599 — — 16,599

Shares issued under employee stock purchase program 1,022 — 8,692 — — 8,692

1 unchanged sentence

Net loss — — — — ( 133,088 ) ( 133,088 )

Other comprehensive loss — — — ( 6,659 ) — ( 6,659 )

Other comprehensive income — — — 8,278 — 8,278

Balance as of December 31, 2023 132,992 $ 3 $ 1,815,245 $ ( 1,008 ) $ ( 834,752 ) $ 979,488

124,336 $ 2 $ 1,666,106 $ ( 9,286 ) $ ( 701,664 ) $ 955,158

Exercise of vested stock options 292 — 1,115 — — 1,115

6 unchanged sentences

Balance at December 31, 2024 142,086 $ 3 $ 1,958,157 $ ( 100 ) $ ( 992,810 ) $ 965,250

132,992 $ 3 $ 1,815,245 $ ( 1,008 ) $ ( 834,752 ) $ 979,488

Exercise of vested stock options 388 — 1,044 — — 1,044

2 unchanged sentences

Shares issued under employee stock purchase program 1,058 — 6,703 — — 6,703

Purchases of capped calls — — ( 18,162 ) — — ( 18,162 )

Stock-based compensation — — 89,463 — — 89,463

2 unchanged sentences

Balance as of December 31, 2025 151,537 $ 3 $ 2,044,103 $ ( 41 ) $ ( 1,114,487 ) $ 929,578

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

CONSOLIDATED STATEMENTS OF CASH FLOWS

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Loss on disposals of property and equipment

Amortization of premiums (discounts) on investments

( 3,973 ) ( 646 ) 3,137

Accretion of discounts on investments ( 4,703 ) ( 3,973 ) ( 646 )

Impairment of operating lease right-of-use assets — 371 744

3 unchanged sentences

Changes in operating assets and liabilities:

Accounts receivable 676 ( 32,945 ) ( 27,359 )

Accounts receivable, net ( 6,222 ) 676 ( 32,945 )

Prepaid expenses and other current assets 1,579 ( 7,627 ) 8,709

4 unchanged sentences

Other liabilities 17,959 ( 6,434 ) 7,064

Net cash (used in) provided by operating activities

Net cash provided by operating activities

94,444 16,406 362

3 unchanged sentences

Maturities of marketable securities 197,176 371,189 433,767

Business acquisitions, net of cash acquired — — ( 25,902 )

Advance payment for purchase of property and equipment — ( 790 ) —

2 unchanged sentences

Capitalized internal-use software ( 17,657 ) ( 26,094 ) ( 21,292 )

Net cash provided by investing activities

Net cash (used in) provided by investing activities

( 213,032 ) 178,900 294,940

Cash flows from financing activities:

Payments of debt issuance costs ( 5,729 ) — —

Proceeds from issuance of convertible notes

Payments of issuance costs for convertible notes

( 5,924 ) ( 5,729 ) —

Cash paid for debt extinguishment

( 148,875 ) — ( 310,540 )

Payments for purchase of capped calls

( 18,162 ) — —

Repayments of finance lease liabilities ( 2,328 ) ( 14,958 ) ( 27,175 )

Cash received for restricted stock sold in advance of vesting conditions — — 10,655

Cash paid for early sale of restricted shares — — ( 10,655 )

Payment of deferred consideration for business acquisitions — ( 3,771 ) ( 4,393 )

1 unchanged sentence

Proceeds from employee stock purchase plan 7,006 6,244 8,559

Net cash used in financing activities

Net cash (used in) provided by financing activities

12,761 ( 17,099 ) ( 331,380 )

10 unchanged sentences

Cash paid for income taxes, net of refunds received $ 1,337 $ 809 $ 331

Cash paid for finance lease interest $ 15 $ 378 $ 1,329

Noncash investing and financing activities:

4 unchanged sentences

Assets obtained in exchange for operating lease obligations $ 7,128 $ 8,543 $ 5,769

Assets obtained in exchange for finance lease obligations $ — $ — $ 23,575

Net noncash change in operating lease assets and liabilities associated with modifications and terminations

$ 16,245 $ 10,439 $ ( 4,425 )

Interest paid for finance leases $ 378 $ 1,329 $ 2,381

Purchase consideration associated with business combination, accrued but not paid $ — $ — $ 8,000

Deployments of prepaid capital equipment $ 9,247 $ 14,598 $ 8,665

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Nature of Business

has built an edge cloud platform that can process, serve, and secure its customers' applications as close to their end users as possible.

is an edge cloud platform that can process, serve, and secure its customers' applications as close to their end users as possible.

The Company was incorporated in Delaware in 2011 and is headquartered in San Francisco, California.

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All intercompany transactions and balances have been eliminated in consolidation.

Certain changes to presentation have been made to conform the prior period presentation to the current period reporting.

The Company has made certain presentation changes to separate out deferred revenue from other current liabilities on the consolidated balance sheets.

Use of Estimates

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Actual results and outcomes could differ significantly from the Company’s estimates, judgments, and assumptions.

Significant estimates, judgments, and assumptions used in these financial statements include, but are not limited to, those related to revenue, accounts receivable and related reserves, internal-use software development costs, the incremental borrowing rate related to the Company’s lease liabilities, fair value of assets acquired and liabilities assumed during business combinations, useful lives of acquired intangible assets and property and equipment, fair value of the Company’s long-lived assets, reporting unit as well as financial instruments, income tax reserves, and accounting for stock-based compensation.

Significant estimates, judgments, and assumptions used in these financial statements include, but are not limited to, those related to revenue, accounts receivable and related reserves, internal-use software development costs, the incremental borrowing rate related to the Company’s lease liabilities, fair value of assets acquired and liabilities assumed during business combinations, useful lives of acquired intangible assets and property and equipment, financial instruments, income tax reserves, and accounting for stock-based compensation.

Estimates are periodically reviewed in light of changes in circumstances, facts, and experience.

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The Company’s cash, cash equivalents, and marketable securities primarily consisted of money market funds, investment-grade commercial paper, corporate notes and bonds, U.S.

treasury securities and agency bonds.

treasury securities, certificates of deposit, and municipal bonds.

The primary focus of its investment strategy is to preserve capital and meet liquidity requirements.

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No single customer accounted for more than 10% of revenue for the years ended December 31, 2025, 2024 and 2023.

No single customer accounted for more than 10% of the total accounts receivable balance as of December 31, 2024, and one customer accounted for more than 10 % of the total accounts receivable balance as of December 31, 2023.

No single customer accounted for more than 10% of the total accounts receivable balance as of December 31, 2025 or 2024.

Affiliated customers that are business units of a single company generated an aggregate of 10 % of the Company’s revenue for the year ended December 31, 2025.

No affiliated customers that are business units of a single company generated more than 10% of revenue for the year ended December 31, 2024.

Affiliated customers that are business units of a single company generated an aggregate of 12 % and 11 % of the Company’s revenue for the years ended, December 31, 2023 and 2022, respectively.

The same affiliated customers accounted for an aggregate of 11 % and 23 % of the Company’s accounts receivable balance as of December 31, 2024 and 2023, respectively.

Affiliated customers that are business units of a single company generated an aggregate of 12 % of the Company’s revenue for the year ended December 31,

No affiliated customers that are business units of a single company accounted for more than 10% of the Company's accounts receivable balance as of December 31, 2025.

Affiliated customers that are business units of a single company accounted for an aggregate of 11 % of the Company’s accounts receivable balance as of December 31, 2024.

Cash, Cash Equivalents, and Marketable Securities

Cash and cash equivalents include cash held in banks, highly liquid money market funds, U.S.

treasury securities and commercial paper, all with original maturities of three months or less when acquired.

treasury securities, municipal securities, and commercial paper, all with original maturities of three months or less when acquired.

The Company’s short-term and long-term marketable securities consists of fixed income U.S.

and foreign government agency securities, corporate bonds, agency bonds, asset-backed securities and commercial paper.

and foreign government agency securities, corporate bonds, municipal securities, certificates of deposit, and commercial paper.

Management determines the appropriate classification of the Company’s investments at the time of purchase and reevaluates such designation at each balance sheet date.

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When the available-for-sale debt securities are sold, cost is based on the specific identification method, and the realized gains and losses are included in other income (expense), net in the consolidated statements of operations.

The Company evaluates its investments periodically for possible other-than-temporary impairment.

A decline in fair value below the amortized costs of its available-for-sale debt securities is considered an other-than-temporary impairment if the Company has the intent to sell the security or it is more likely than not that the Company will be required to sell the security before recovery of the entire amortized cost basis.

Otherwise, the credit loss component of the impairment is recorded as allowance for credit losses with an offsetting entry charged to other income (expense), net, while the remaining loss is recognized in other comprehensive income (loss).

Restricted Cash

As of December 31, 2024, the Company did not have any restricted cash.

As of December 31, 2023, the Company had a restricted cash balance of $ 0.2 million, which consists of a letter of credit related to a lease arrangement that is collateralized by restricted cash.

As of December 31, 2023, this amount is included in prepaid expenses and other current assets on the consolidated balance sheets.

All of the Company’s investments are subject to a periodic impairment review.

The Company recognizes an impairment charge when the fair value of its investments decline below their respective cost basis.

Factors considered in determining whether a credit impairment has occurred include whether the decline in fair value is due to credit related factors, the Company’s intent to sell the security, and whether or not the Company will be required to sell the security prior to the expected recovery of the investment’s amortized cost basis.

No such impairment charges were recorded during the years ended December 31, 2025, 2024, and 2023.

Accounts Receivable, net

11 unchanged sentences

Management periodically reviews the carrying amount of deferred commission costs to determine whether events or changes in circumstances have occurred that could impact the period of benefit of these deferred costs.

Amortization is primarily included in sales and marketing expense in the consolidated statements of operations.

Deferred commission and incentive payments are included in other assets on the consolidated balance sheets.

Amortization is included in sales and marketing expense in the consolidated statements of operations.

Deferred commission are included in other assets on the consolidated balance sheets.

Fair Value of Financial Instruments

The Company’s available-for-sale securities are recorded at fair value.

The Company’s cash and cash equivalents and restricted cash are recorded at cost, which approximates fair value.

The Company’s cash and cash equivalents are recorded at cost, which approximates fair value.

Additionally, accounts receivable, accounts payable, and accrued expenses approximate fair value due to their short-term nature.

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Costs incurred during the planning, training, and post-implementation stages of the software development life-cycle are expensed as incurred.

Business Combinations

The Company accounts for its acquisitions using the acquisition method of accounting, which requires, among other things, allocation of the fair value of purchase consideration to the tangible and intangible assets acquired and liabilities assumed at their estimated fair values on the acquisition date.

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

Determining the fair value of assets acquired and liabilities assumed requires significant judgment and estimates including the selection of valuation methodologies, future expected cash flows, discount rates, and useful lives.

The Company’s estimates of fair value are based on assumptions believed to be reasonable, but which are inherently uncertain and, as a result, actual results may differ from estimates.

During the measurement period, not to exceed one year from the date of acquisition, the Company may record adjustments to the assets acquired and liabilities assumed with a corresponding offset to goodwill to reflect new information obtained about facts and circumstances that existed as of the acquisition date.

At the conclusion of the

measurement period, or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are reflected in the consolidated statements of operations.

Transaction costs associated with business combinations are expensed as incurred, and are included in general and administrative expense in the consolidated statements of operations.

Goodwill, Intangible Assets and Other Long-Lived Assets

6 unchanged sentences

The Company did not recognize any goodwill impairment charges for any of the periods presented.

Goodwill has historically been tested for impairment annually on October 31 or more frequently upon the occurrence of certain events or substantive changes in circumstances that indicate impairment is more likely than not.

During the year ended December 31, 2025, the Company changed the date of its annual impairment test from October 31 to October 1 of each year.

This change is preferable because it aligns the Company’s impairment testing procedures with its annual business planning and budgeting process and allows the Company to maximize time and resources required to perform the impairment analysis.

The Company does not consider this change in impairment testing date to be a material change in the application of an accounting principle as it does not result in the delay, acceleration or avoidance of an impairment charge.

On October 1, 2025, the Company completed its annual goodwill impairment test associated with its single reporting unit and, based on the qualitative assessment, determined it was more likely than not that the fair value of the reporting unit exceeded its carrying value.

The Company did not identify any events or changes in circumstances since the performance of its annual goodwill impairment test that would require the Company to perform another goodwill impairment test during the fiscal year.

The Company’s definite lived intangible assets are carried at cost, net of accumulated amortization.

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The majority of the Company’s usage-based contracts commit the customer to a minimum monthly level of usage and specify the rate at which the customer must pay for actual usage above the monthly minimum.

The Company also offers subscriptions to access a unified security web application at a fixed rate.

The Company recognizes revenue in accordance with Accounting Standards Codification (“ASC”) 606, where revenue is recognized upon transfer of control of promised products or services to customers in an amount that reflects the consideration the Company expects to receive in exchange for those products or services.

The processing and recording of certain revenue requires a manual process, which uses a complex set of procedures to generate complete and accurate data to record these revenue transactions.

The Company enters into contracts that can include various combinations of products and services, each of which are distinct and accounted for as separate performance obligations.

The Company also offers subscriptions to access security services at a fixed rate.

Revenue is recognized net of any taxes collected from customers, which are subsequently remitted to governmental authorities.

The Company’s contracts with customers often include promises to transfer multiple products and services to a customer.

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

In accordance with Revenue from Contracts with Customers (“ASC 606”), revenue is recognized when a customer obtains control of promised services.

The amount of revenue recognized reflects the consideration that the Company expects to be entitled to receive in exchange for these services.

To achieve the core principle of this standard, the Company applies the following five steps:

(1) Identify the contract with a customer

The Company considers the terms and conditions of contracts with customers and its customary business practices in identifying contracts under ASC 606.

The Company determines it has a contract with a customer when the contract is approved, each party’s rights regarding the services to be transferred can be identified, payment terms for the services can be identified, it has been determined that the customer has the ability and intent to pay, and the contract has commercial substance.

The Company applies judgment in determining the customer’s ability and intent to pay, which is based on a variety of factors, including the customer’s historical payment experience or, in the case of a new customer, credit and financial information pertaining to the customer.

(2) Identify the performance obligations in the contract

Performance obligations promised in a contract are identified based on the services that will be transferred to the customer that are both capable of being distinct, whereby the customer can benefit from the service either on its own or together with other resources that are readily available from the Company or from third parties, and are distinct in the context of the contract, whereby the transfer of the services is separately identifiable from other promises in the contract.

The Company’s contracts with customers often include promises to transfer multiple services to a customer.

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

Performance obligations generally represent stand-ready obligations that are satisfied over time as the customer simultaneously receives and consumes the benefits provided by the Company.

These obligations can be network services, security, compute, professional services, support, and other edge cloud platform services.

Accordingly, the Company’s revenue is recognized over time, consistent with the pattern of benefit provided to the customer over the term of the agreement.

For contracts with multiple performance obligations that are delivered over different time periods, the Company allocates the contract transaction price to each performance obligation using the estimated standalone selling price ( “ SSP”) of each distinct good or service in the contract.

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

The Company analyzes separate sales of its products and services or the discounted list price per management’s approved price list as a basis for estimating the SSP of these products and services.

In instances where SSP is not directly observable, such as when the Company does not sell the product or service separately, the Company determines the SSP using information that may include market conditions and other observable inputs.

The Company typically has more than one SSP for individual products and services due to the stratification of those products and services by customers and circumstances.

In these instances, the Company may use information, such as geographic region and distribution channel, in determining the SSP.

(3) Determine the transaction price

The transaction price is determined based on the consideration to which the Company is expected to be entitled in exchange for transferring services to the customer.

Variable consideration is included in the transaction price if it is probable that a significant future reversal of cumulative revenue under the contract will not occur.

The transaction price in a contract for usage-based services is typically equal to the minimum commit price in the contract plus any variable amounts of usage above the minimum commitment, less any discounts provided.

The transaction price in a contract that does not contain usage-based services is equal to the total contract value.

(4) Allocate the transaction price to performance obligations in the contract

If the contract contains a single performance obligation, the entire transaction price is allocated to the single performance obligation.

Contracts that contain multiple performance obligations require an allocation of the transaction price to each performance obligation based on a relative standalone selling price (“SSP”).

For contracts with multiple performance obligations that are delivered over different time periods, the Company allocates the contract transaction price to each performance obligation using the estimated SSP of each distinct good or service in the contract.

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

The Company analyzes separate sales of its services or the discounted list price per management’s approved price list as a basis for estimating the SSP of these services.

In instances where SSP is not directly observable, such as when the Company does not sell the service separately, the Company determines the SSP using information that may include market conditions and other observable inputs.

The Company typically has more than one SSP for individual products and services due to the stratification of those services by customers and circumstances.

In these instances, the Company may use information, such as geographic region and distribution channel, in determining the SSP.

Because the Company’s typical contracts represent distinct services delivered over time with the same pattern of transfer to the customer, usage-based consideration primarily related to actual consumption over the minimum commit levels is allocated to the period to which it relates.

The amount of consideration recognized for usage above the minimum commit price is limited to the amount the Company expects to be entitled to receive in exchange for providing services.

The Company has elected to apply the practical expedient for estimating and disclosing the variable consideration when variable consideration is allocated entirely to a wholly unsatisfied performance obligation or to a wholly unsatisfied promise to transfer a distinct good or service that forms part of a single performance obligation from its remaining performance obligations under these contracts.

The Company has elected to apply the practical expedient for estimating and disclosing the variable consideration when variable consideration is allocated entirely to a wholly unsatisfied performance obligation or to a wholly unsatisfied promise to transfer a distinct good or service that forms part of a performance obligation from its remaining performance obligations under these contracts.

For contracts to which such practical expedient cannot be applied, consideration is estimated.

For custom arrangements, other methods may be used as a measure of progress towards satisfying the performance obligations.

(5) Recognize revenue when or as performance obligations are satisfied

Revenue is recognized when control of the services is transferred to the customer, in an amount that reflects the consideration expected to be received in exchange for those services.

The Company generates all its revenue from contracts with customers.

The Company’s revenue is recognized over time, consistent with the pattern of benefit provided to the

customer over the term of the agreement.

Revenue on the Company’s subscription services are recognized ratably over their respective contractual term.

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The Company recognizes stock-based compensation expense based on the grant-date fair value of the awards.

The fair values of the restricted stock units (“RSUs”), restricted stock awards (“RSAs”) and performance stock awards (“PSUs”) are based on the fair value of the Company’s stock price on the grant date.

The fair values of the restricted stock units (“RSUs”) and performance stock awards (“PSUs”) are based on the fair value of the Company’s stock price on the grant date.

The fair values of stock options and employee stock purchase program (“ESPP”) are based on the Black-Scholes option-pricing model.

The fair value of the market-based performance stock awards (“MPSUs”) is measured using a Monte Carlo simulation valuation model.

The fair value of the market-based performance stock awards (“MPSUs”) and Relative Total Shareholder Return Award PSUs (“rTSR PSUs”) are measured using a Monte Carlo simulation valuation model.

The determination of the fair value of a stock-based award is affected by the deemed fair value of the underlying stock price on the grant date, as well as assumptions regarding a number of other complex and subjective variables, including expected term and stock price volatility of the awards.

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The functional currency of the Company’s foreign subsidiaries is the U.S.

The monetary assets and liabilities that are denominated in a currency other than the U.S.

dollar of the Company’s foreign subsidiaries are remeasured into U.S.

dollars at the exchange rate on the balance sheet date, while non-monetary items are remeasured at historical rates.

Revenue and expenses are remeasured at average exchange rates during the period.

Transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency are included in other income (expense), net in the consolidated statements of operations.

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In making such a determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations.

If the Company determines that it would be able to realize its deferred tax assets in the future in excess of

their net recorded amount, the Company would make an adjustment to the deferred tax asset valuation allowance, which would reduce the provision for income taxes.

If the Company determines that it would be able to realize its deferred tax assets in the future in excess of their net recorded amount, the Company would make an adjustment to the deferred tax asset valuation allowance, which would reduce the provision for income taxes.

The Company records uncertain tax positions in accordance with ASC 740 on the basis of a two-step process in which (1) it determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, the Company recognizes the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority.

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Basic and diluted net loss per share is computed by dividing net loss by the weighted-average number of shares of common stock outstanding during the period.

Diluted earnings per share attributable to common stockholders adjusts basic earnings per share for the potentially dilutive impact of stock options, restricted stock units, restricted stock awards, shares issuable under its employee stock purchase place and performance stock awards.

The Company also applies the if-converted method for calculation of diluted earnings per share for its convertible debt instruments.

As the Company has reported losses for all periods presented, all potentially dilutive securities are antidilutive and accordingly, basic net loss per share equals diluted net loss per share.

Segment Information

The Company has one reportable and operating segment.

Financial information about the Company’s operating segment and geographic areas is presented in Note 13 to these financial statements.

Recently Issued and Adopted Accounting Pronouncements

In November 2023, the FASB issued ASU 2023-07 “Segment Reporting - Improvements to Reportable Segment Disclosures”, which updates reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses and information used to assess segment performance.

The guidance is effective for the Company's annual periods beginning in 2024 and interim periods beginning in the first quarter of fiscal year 2025.

The Company adopted the standard on December 31, 2024.

For further information, refer to Note 14 Segment and Geographic Information in the accompanying notes to the consolidated financial statements.

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

In December 2023, the Financial Accounting Standards Board ("FASB") issued ASU 2023-09 “Income Taxes (Topic 740):

Improvements to Income Tax Disclosures”, which expands disclosures in an entity’s income tax rate reconciliation table and regarding cash taxes paid both in the U.S.

and foreign jurisdictions.

The guidance is effective for the Company's annual periods beginning in 2025.

The Company is currently evaluating the impact of the new guidance and intends to adopt the guidance prospectively when it becomes effective in 2025.

The guidance is effective for the Company's annual

periods beginning in 2025.

The Company adopted the standard on December 31, 2025.

For further information, refer to Note 12—Income Taxes, in these financial statements.

In November 2024, the FASB issued ASU 2024-03 “Disaggregation of Income Statement Expenses,” which aims to improve the disclosures about a public business entity’s expenses and address requests from investors for more detailed information about the types of expenses in commonly presented expense captions.

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The Company did not early adopt and is currently evaluating the impact of the new guidance.

In September 2025, the FASB issued ASU 2025-06 “Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40):

Targeted Improvements to the Accounting for Internal-Use Software,” which aims to clarify and modernize the accounting for costs related to internal-use software.

The guidance is effective for the Company's interim and annual periods beginning in 2028.

The Company is currently evaluating the impact of the new guidance.

Disaggregation of Revenue

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United States $ 465,450 $ 407,324 $ 370,424

Asia Pacific 65,907 72,873 58,073

Europe 49,961 42,770 38,469

All other 20,484 19,921 20,034

Total revenue $ 543,676 $ 505,988 $ 432,725

The majority of the Company’s revenue is derived from enterprise customers, which are defined as customers with annualized current quarter revenue in excess of $ 100,000 .

This is calculated by taking the sum of revenue for each customer within the quarter and multiplying it by four.

The following table presents the Company’s net revenue for enterprise and non-enterprise customers:

Year ended December 31,

2024 2023 2022

(in thousands)

Enterprise customers $ 499,576 $ 464,452 $ 393,152

Non-enterprise customers 44,100 41,536 39,573

All other countries 158,568 136,352 135,564

Total revenue $ 624,018 $ 543,676 $ 505,988

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The timing of revenue recognition may differ from the timing of invoicing to customers.

The Company has an unconditional right to consideration when it invoices its customers and records a receivable.

The Company records a contract asset, or unbilled receivable, when revenue is recognized prior to invoicing.

The Company records a contract liability, or deferred revenue, when a contract is billed in advance of revenue being recognized.

Deferred revenue pertains to amounts billed to customers for which revenue has not been recognized, which primarily consists of the unearned portions of billings for the Company’s security subscription services and the unearned portion of edge cloud platform usage.

Amounts that have been invoiced for annual subscriptions, but not collected, are recorded in accounts receivable and in unearned revenue or in revenue depending on whether services have been delivered to the customer.

The Company’s payment terms and conditions vary by contract type, and generally range from 30 to 90 days .

Contract assets are recognized when a conditional right to consideration exists and transfer of control has occurred.

The Company records a contract asset, or unbilled receivable, when revenue is recognized prior to invoicing.

Contract assets are typically related to the Company's subscription services and cloud usage.

Contract assets are included in accounts receivable, net on the Company's Consolidated Balance Sheets.

The Company records a contract liability, or deferred revenue, when a contract is billed to customers in advance of revenue being recognized.

Deferred revenue primarily consists of the unearned portions of billings for the Company’s security subscription services and the unearned portion of committed edge cloud platform usage.

Contract liabilities are included in deferred revenue for the current portion and other long term liabilities for the long-term portion on the Consolidated Balance Sheets.

The following table presents the Company’s contract assets and contract liabilities as of December 31, 2025 and 2024:

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Remaining Performance Obligations

Revenue allocated to remaining performance obligations represents deferred revenue and amounts that were and will be invoiced and recognized as revenue in future periods for non-cancelable subscription arrangements and usage commitments.

The Company’s RPO excludes performance obligations from on-demand arrangements when there are no minimum purchase commitments associated with these arrangements.

As of December 31, 2025, the aggregate amount of the transaction price in our contracts allocated to remaining performance obligations that are unsatisfied or partially unsatisfied was $ 353.8 million.

This amount includes future committed revenue for periods within current contracts with customers, as well as deferred revenue arising from consideration invoiced for which the related performance obligations have not been satisfied.

The Company has elected to not provide certain information about its remaining performance obligations for service contracts with an original contract duration of one year or less.

As of December 31, 2025, the Company expects to recognize approximately 70 % of its remaining performance obligations over the next 12 months.

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Investments and Fair Value Measurements

The Company’s total cash, cash equivalents and marketable securities consisted of the following:

As of December 31,

(in thousands)

Cash and cash equivalents:

Cash $ 52,951 $ 21,269

Treasury securities — 52,830

Money market funds 233,224 21,166

Commercial paper — 12,656

Total cash and cash equivalents

$ 286,175 $ 107,921

Marketable securities:

Treasury securities $ — $ 73,448

Corporate notes and bonds 6,008 105,566

Commercial paper 3,699 25,934

Total marketable securities, current $ 9,707 $ 214,799

Corporate notes and bonds — 5,999

Asset-backed securities — 89

Total marketable securities, non-current $ — $ 6,088

Total marketable securities $ 9,707 $ 220,887

Total cash, cash equivalents and marketable securities $ 295,882 $ 328,808

The following table summarizes adjusted cost, gross unrealized gains and losses, and fair value related to cash and cash equivalents and available-for-sale securities on the accompanying consolidated balance sheets as of December 31, 2024 and December 31, 2023:

As of December 31, 2024

(in thousands)

Cash and cash equivalents:

Money market funds

$ 233,224 $ — $ — $ 233,224

Marketable securities:

Corporate notes and bonds 6,005 3 — 6,008

Commercial paper 3,699 — — 3,699

Total available-for-sale investments $ 242,928 $ 3 $ — $ 242,931

As of December 31, 2023

Cost Gross Unrealized Gain Gross

Unrealized Loss Fair

(in thousands)

Cash and cash equivalents:

Treasury securities $ 52,824 $ 6 $ — $ 52,830

Commercial paper 12,663 — ( 7 ) 12,656

Marketable securities:

Treasury securities 73,444 8 ( 4 ) 73,448

Corporate notes and bonds 112,487 9 ( 931 ) 111,565

Commercial paper 25,946 — ( 12 ) 25,934

Asset-backed securities 89 — — 89

Agency bonds 9,854 — ( 3 ) 9,851

Total available-for-sale investments $ 287,307 $ 23 $ ( 957 ) $ 286,373

There were no material realized gains or losses from sales of marketable securities that were reclassified out of accumulated other comprehensive income (loss) into other income (expense), net as of December 31, 2024 and December 31, 2023.

For the years ended December 31, 2024, 2023 and 2022, the Company did not record any impairment charges for its marketable debt securities in its consolidated statements of operations.

No impairment loss has been recorded on the securities as the Company does not intend to sell any impaired securities, nor is it more likely than not that the Company would be required to sell impaired securities before recovery of amortized cost basis.

Fair Value of Financial Instruments

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Level 3—Unobservable inputs that are supported by little or no market activity, which require management judgment or estimation.

The Company measures its cash equivalents, marketable securities, and restricted cash at fair value.

The Company classifies its cash equivalents, marketable securities and restricted cash within Level 1 or Level 2 because the Company values these investments using quoted market prices or alternative pricing sources and models utilizing market observable inputs.

The Company measures its cash equivalents and marketable securities at fair value.

The Company classifies its cash equivalents and marketable securities within Level 1 or Level 2 because the Company values these investments using quoted market prices or alternative pricing sources and models utilizing market observable inputs.

The Company classifies its investments, which are comprised of corporate notes and bonds, commercial paper, U.S.

treasury securities, agency bonds, foreign government and supranational securities and asset-backed securities within Level 2 of the fair value hierarchy because the fair value of these securities is priced by using inputs based on non-binding market consensus prices that are primarily corroborated by observable market data or quoted market prices for similar instruments.

Financial assets and liabilities measured and recorded at fair value on a recurring basis consisted of the following types of instruments:

treasury securities, securities of deposit, and municipal securities within Level 2 of the fair value hierarchy because the fair value of these securities is priced by using inputs based on non-binding market consensus prices that are primarily corroborated by observable market data or quoted market prices for similar instruments.

Financial assets and liabilities are measured and recorded at fair value on a recurring basis.

The following table summarizes the Company’s cash and marketable securities' amortized cost, unrealized gains (losses), and fair value by significant investment category reported as cash and cash equivalents or marketable securities as of December 31, 2025 and 2024.

As of December 31, 2025

Level 1 Level 2 Level 3 Total

Value Cash and cash equivalents

Marketable securities:

(in thousands)

Cash equivalents:

$ 87,743 $ — $ — $ 87,743 $ 87,743 $ —

Money market funds 44,032 — — 44,032 44,032 —

Total cash equivalents 233,224 — — 233,224

Marketable securities:

Treasury securities 64,273 27 — 64,300 8,290 56,010

Corporate notes and bonds 50,942 19 — 50,961 4,570 46,391

Commercial paper 111,706 20 ( 2 ) 111,724 33,928 77,796

Municipal Securities 1,600 — — 1,600 1,600 —

Certificates of deposit 1,399 — — 1,399 400 999

$ 361,695 $ 66 $ ( 2 ) $ 361,759 $ 180,563 $ 181,196

Total marketable securities — 9,707 — 9,707

Total financial assets $ 233,224 $ 9,707 $ — $ 242,931

As of December 31, 2024

Level 1 Level 2 Level 3 Total

Value Cash and cash equivalents:

Marketable securities:

(in thousands)

Cash equivalents:

$ 52,951 $ — $ — $ 52,951 $ 52,951 $ —

Money market funds

Treasury securities — 52,830 — 52,830

Commercial paper — 12,656 — 12,656

Total cash equivalents 21,166 65,486 — 86,652

Marketable securities:

Treasury securities — 73,448 — 73,448

233,224 — — 233,224 233,224 —

Corporate notes and bonds 6,005 3 — 6,008 — 6,008

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$ 295,879 $ 3 $ — $ 295,882 $ 286,175 $ 9,707

Asset-backed securities — 89 — 89

— 9,851 — 9,851

Total marketable securities — 220,887 — 220,887

Restricted cash:

Restricted cash, current

Total restricted cash 150 — — 150

Total financial assets $ 21,316 $ 286,373 $ — $ 307,689

The Company did no t have a restricted cash balance as of December 31, 2024.

Restricted cash was $ 0.2 million as of December 31, 2023.

The restricted cash balance consisted of letters of credit related to lease arrangements that were collateralized by the Company’s cash.

The amount as of December 31, 2023 was classified as current on the Company’s consolidated balance sheets.

There were no transfers of assets and liabilities measured at fair value between Level 1 and Level 2, or between Level 2 and Level 3, during the years ended December 31, 2025 and 2024.

Business Combinations

On May 18, 2022, the Company acquired 100 % of the voting equity interest of Glitch, Inc.

(“Glitch”), a software company specializing in developer project management tools, for $ 34.9 million in cash, of which $ 8.0 million was held back as security for indemnification claims under the terms of the merger agreement (“Holdback”).

During the year ended December 31, 2023, $ 4.1 million of the Holdback was distributed to certain shareholders of Glitch, and during the year ended December 31, 2024, the remaining $ 3.8 million of the Holdback, net of indemnification claims, was distributed.

The acquisition expands the Company’s brand awareness within the developer community and bolsters the Company’s existing product offerings by making it easier to innovate at a layer in the Company’s software stack.

The Company accounted for the transaction as a business combination.

The purchase price was preliminarily allocated based on the estimated fair value of the identified intangible assets of $ 2.0 million, cash of $ 1.6 million and other net assets of $ 0.6 million, and goodwill of $ 32.5 million.

The goodwill was primarily attributed to the value of synergies created with the acquisition of Glitch’s technology offering.

Goodwill is not deductible for income tax purposes.

Identifiable finite-lived intangible assets were comprised of the following (in thousands):

Total Estimated useful life (in years)

Developed technology

Customer relationships 760 3

Trade name 610 4

Total intangible assets acquired $ 2,000

For the year ended December 31, 2022, we incurred $ 2.0 million in acquisition-related expenses.

The acquired intangible assets have a total weighted average amortization period of 3.6 years.

From the date of the acquisition, the financial results of Glitch have been included in and are not material to the Company’s consolidated financial statements.

Pro forma revenue and results of operations have not been presented because the historical results are not material to the consolidated financial statements in any period presented.

There were no material realized gains or losses from sales of marketable securities that were reclassified out of accumulated other comprehensive loss into other expense, net as of December 31, 2025 and December 31, 2024.

For the years ended December 31, 2025, 2024 and 2023, the Company did not record any impairment charges for its marketable debt securities in its consolidated statements of operations.

Balance Sheet Information

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Ending balance $ 6,262 $ 8,254 $ 7,054

Revenue Reserve

The activity in the revenue reserve is as follows:

As of December 31,

2025 2024 2023

(in thousands)

Beginning balance $ 5,130 $ 4,296 $ 2,449

Additions to the reserves 10,052 834 1,847

Write-offs and adjustments ( 7,420 ) — —

Ending balance $ 7,762 $ 5,130 $ 4,296

Property and Equipment, Net

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Property and equipment, net $ 186,785 $ 179,097

During the year ended December 31, 2024, the Company recognized an impairment charge of $ 2.8 million related to equipment and an internal-use software project that the Company does not plan to continue with and therefore abandoned.

The Company did not recognize any material impairment charge during the year ended December 31, 2025,

During the year ended December 31, 2024, the Company recognized an impairment charge of $ 2.8 million related to equipment and an internal-use software project that the Company did not plan to continue with and therefore abandoned.

During the year ended December 31, 2023, the Company recognized an impairment charge of $ 4.3 million, of which $ 3.0 million related to property and equipment, net and $ 1.3 million related to advance payments for the purchase of property and equipment.

The write-off was primarily related to excess computer and networking equipment including software the Company does not expect to use and therefore abandoned.

The write-off was primarily related to excess computer and networking equipment including software the

Company did not expect to use and therefore abandoned.

Impairment charges are included within impairment expense in the consolidated statements of operations.

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As of December 31, 2025 and 2024, the unamortized balance of capitalized internal-use software costs on the Company’s consolidated balance sheets was approximately $ 81.4 million and $ 79.5 million, respectively.

The Company leases certain networking equipment from various third parties through equipment finance leases.

The Company’s networking equipment assets as of December 31, 2024 and 2023 , included a total of $ 73.2 million and $ 74.7 million acquired under finance lease agreements, respectively.

These leases are capitalized in property and equipment, and the related amortization of assets under finance leases is included in depreciation and amortization expense.

The accumulated depreciation of the associated networking equipment assets under finance leases totaled $ 52.2 million and $ 40.1 million as of December 31, 2024 and 2023 , respectively.

Other assets consisted of the following:

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Total other assets $ 57,789 $ 68,402

Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consisted of the following:

As of December 31,

(in thousands)

Prepaid expenses

$ 16,737 $ 22,455

Other current assets

Total $ 26,921 $ 28,325

Accrued Expenses

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Accrued compensation and related benefits $ 46,611 $ 19,266

Accrued bonus 6,566 24,614

Accrued colocation and bandwidth costs 13,944 15,317

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(in thousands)

Deferred revenue $ 26,511 $ 33,824

Accrued computer and networking equipment $ 413 $ 743

Holdback payable — 3,771

Customer deposits

Other current liabilities 971 840

Total other current liabilities $ 7,499 $ 2,796

Accumulated Other Comprehensive Loss

The following table summarizes the changes in accumulated other comprehensive loss, which is reported as a component of stockholders’ equity:

Foreign Currency Translation Unrealized gain/(loss) for available-for-sale investments

Accumulated Other Comprehensive Income (Loss)

(in thousands)

Balance at December 31, 2021

$ ( 322 ) $ ( 2,305 ) $ ( 2,627 )

Other comprehensive loss

( 255 ) ( 6,404 ) ( 6,659 )

Balance at December 31, 2022

$ ( 577 ) $ ( 8,709 ) $ ( 9,286 )

Other comprehensive loss

565 7,713 8,278

Balance at December 31, 2023

$ ( 12 ) $ ( 996 ) $ ( 1,008 )

Other comprehensive income

Balance at December 31, 2024

$ ( 12 ) $ ( 88 ) $ ( 100 )

There were no material reclassifications out of accumulated other comprehensive loss for the years ended December 31, 2024, 2023, and 2022.

Additionally, there was no material tax impact on the amounts presented.

The Company has operating leases for corporate offices and data centers (“colocation” leases) and finance leases for networking equipment.

The Company’s operating leases have remaining lease terms ranging from less than 1 year to 9 years, some of which include options to extend the leases.

The Company’s finance leases have remaining lease terms less than 1 year.

The Company also subleases a portion of its corporate office spaces.

The Company’s subleases have remaining lease terms ranging from 1 year to 5 years.

The Company’s subleases have remaining lease terms ranging from less than 1 year to 4 years.

Sublease income was $ 0.8 million, $ 1.4 million, and $ 1.2 million for the years ended December 31, 2025, 2024 and 2023, respectively.

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The short-term lease costs were not material for the years ended December 31, 2025, 2024 and 2023.

The Company did not recognize any material impairment charge on its operating lease right-of-use assets during the year ended December 31, 2025.

During the year ended December 31, 2024, the Company recognized an impairment charge of $ 1.7 million related to right-of-use assets, of which $ 1.3 million was related to the Company exiting a certain office facility and is included within the impairment expense line in the Company's consolidated statements of operations.

During the years ended December 31, 2023 and 2022, the Company recognized impairment on its operating lease right-of-use assets of $ 0.7 million and $ 2.1 million, respectively.

During the year ended December 31, 2023, the Company recognized impairment on its operating lease right-of-use assets of $ 0.7 million.

As of December 31,

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Future minimum lease payments under non-cancellable leases as of December 31, 2025 were as follows:

Operating Leases Finance Leases

Operating Leases

(in thousands)

1 unchanged sentence

2026 $ 30,344

2026 23,796 —

2027 14,669 —

Thereafter 15,245

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As of December 31, 2025, the Company has undiscounted commitments of $ 9.1 million for operating leases that have not yet commenced, and therefore are not included in the right-of-use asset or operating lease liability.

These operating leases will commence in the first quarter of 2025 with lease terms of 3 years.

These operating leases will commence in the first quarter of 2026 with lease terms ranging from 2 years to 5 years.

Goodwill and Intangible Assets

The changes in the carrying amount of goodwill for th e years ended December 31, 2024 and 2023 are as follows :

Year ended December 31,

(in thousands)

Beginning balance $ 670,356 $ 670,185

Foreign currency translation and other adjustments — 171

Ending balance $ 670,356 $ 670,356

The goodwill acquired from business combinations are from the Company’s acquisition described in Note 5 — Business Combinations.

During the year ended December 31, 2024, the Company identified certain triggering events, including a sustained decrease in our stock price and market capitalization and performed an interim and an annual fair value assessment, as of June 30, 2024 and October 31, 2024, respectively, of its one single reporting unit by using a combination of income and market approaches and concluded that the estimated fair value of our single reporting unit substantially exceeded its carrying value.

During the year ended December 31, 2022, the Company identified certain triggering events, including a sustained decrease in our stock price and market capitalization and performed an annual fair value assessment, as of October 31, 2023, of its one single reporting unit by using a combination of income and market approaches and concluded that the estimated fair value of our single reporting unit substantially exceeded its carrying value.

As of December 31, 2025 and 2024, the Company’s goodwill was $ 670.4 million.

The Company did not record an impairment charge on goodwill for the fiscal years ended December 31, 2025, 2024 and 2023.

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The Company did not purchase any intangible assets during the years ended December 31, 2025, 2024 and 2023.

During the year ended December 31, 2022, the Company added $ 2.0 million of intangible assets from the acquisition of Glitch, which are subject to amortization.

The Company did no t record any impairments during the years ended December 31, 2024, 2023 and 2022.

The Company recorded an impairment charge of $ 0.3 million for the year ended December 31, 2025 related to the write-off of intangible assets no longer in use.

The Company did not record an impairment charge on its intangible assets for either of the years ended December 31, 2024 or 2023.

The expected amortization expense of intangible assets subject to amortization as of December 31, 2025 is as follows:

1 unchanged sentence

(in thousands)

2025 $ 16,976

Year ending December 31,

Thereafter 106

1 unchanged sentence

Debt Instruments

Senior Secured Credit Facilities Agreement

On February 16, 2021, the Company entered into a Senior Secured Credit Facilities Agreement (“Credit Agreement”) with the lenders from time to time party thereto (the “Lenders”) and Silicon Valley Bank, as a lender and as administrative agent and collateral agent for the Lenders, for an aggregate commitment amount of $ 100.0 million with a maturity date of February 16, 2024.

Senior Secured Credit Facilities Credit Agreement

On February 16, 2021, the Company entered into a Senior Secured Credit Facilities Credit Agreement (as amended, restated, amended and restated, supplemented, restructured, or otherwise modified from time to time, the “Credit Agreement”) with the lenders from time to time party thereto (the “Lenders”) and Silicon Valley Bank, a division of First-Citizens Bank & Trust Company, as a lender and as administrative agent and collateral agent for the Lenders.

The Credit Agreement provides for a $ 60.0 million senior secured revolving facility, with a maturity date of the earlier of (i) April 30, 2027 and (ii) so long as any of our permitted convertible debt is outstanding after January 30, 2027 and if Net Liquidity is less than $ 200.0 million (or, if the amount of outstanding permitted convertible debt is less than $ 35.0 million, $ 120.0 million), such date.

The Company recorded $ 0.6 million of debt issuance costs associated with the Credit Agreement in other assets on the Company’s consolidated balance sheet.

The Credit Agreement originally bore interest at a rate per annum equal to the sum of LIBOR for the applicable interest period plus 1.75 % to 2.00 %, depending on the average daily outstanding balance of all loans and letters of credit under the Credit Agreement.

On June 28, 2023, the Company entered into the First Amendment to Credit Agreement with the Lenders and First-Citizens Bank & Trust Company (successor by purchase to the Federal Deposit Insurance Corporation as Receiver for Silicon Valley Bridge Bank, N.A.

(as successor to Silicon Valley Bank)), as a lender and as administrative agent and collateral agent for the Lenders, which, among other things, amended the interest rate provisions of the Credit Agreement to replace LIBOR with the Secured Overnight Finance Rate (“SOFR”) as the interest rate benchmark.

On February 16, 2024, the Company entered into the Second Amendment to Credit Agreement with the Lenders and Silicon Valley Bank, a division of First-Citizens Bank & Trust Company, as a lender and as administrative agent and collateral agent for the Lenders, which, among other things, extended the maturity date of the loans under the Credit Agreement to June 14, 2024.

On April 30, 2024, the Company entered into the Third Amendment to Credit Agreement with the Lenders and Silicon Valley Bank, a division of First-Citizens Bank & Trust Company, as a lender and as administrative agent and collateral agent for the Lenders, which, among other things, extended the maturity date of the loans under the Credit Agreement to April 30, 2027 and decreased the commitment amount from $ 100.0 million to $ 60.0 million, including a $ 10.0 million sublimit for the issuance of letters of credit, and a swingline subfacility of up to $ 20.0 million.

As amended, the revolving loans bear interest, at the Company’s election, at an annual rate based on SOFR or a base rate.

Loans based on SOFR bear interest at a rate per annum equal to SOFR, plus an adjustment of 0.10 %, plus 1.75 % to 2.00 %, depending on the average daily outstanding balance of all loans and letters of credit under the Credit Agreement.

Loans based on the base rate bear interest at a rate per annum equal to the base rate plus 0.75 % to 1.00 %, depending on the average daily outstanding balance of all loans and letters of credit under the Credit Agreement.

Interest payments on outstanding borrowings are due on the last day of each interest period.

The revolving loans bear interest, at the Company’s election, at an annual rate based on the ABR (as defined in the Credit Agreement) plus 1.00 % (such loans, the “ABR Loans”) or the Adjusted Term SOFR (as defined in the Credit Agreement) plus 2.00 % (such loans, the “SOFR Loans”).

Interest payments on outstanding borrowings are due, with respect to SOFR Loans, on the last day of each interest period and with respect to ABR Loans, on the last calendar day of each month.

The Credit Agreement has a commitment fee on the unused portion of the borrowing commitment, which is payable on the last day of each calendar quarter at a rate per annum of 0.20 % to 0.25 % depending on the average daily outstanding balance of all loans and letters of credit under the Credit Agreement.

In addition, the Company’s Credit Agreement contains a financial covenant that requires the Company to maintain a consolidated adjusted quick ratio of at least 1.25 tested on a quarterly basis as well as a springing revenue growth covenant for certain periods if the Company’s consolidated adjusted quick ratio falls below 1.75 on the last day of any fiscal quarter.

In addition, the Credit Agreement contains a financial covenant that requires the Company to maintain a consolidated adjusted quick ratio of at least 1.25 to 1:00 tested on a quarterly basis as well as a springing revenue growth covenant not to be less than 5 % on a quarterly basis for certain periods if the Company’s consolidated adjusted quick ratio falls below 1.75 to 1:00 on the last day of any fiscal quarter.

The Credit Agreement requires the Company to comply with various affirmative and negative covenants, and contains customary events of default.

As of December 31, 2024 and 2023, the Company was in compliance with all of the Credit Agreement’s covenants.

As of December 31, 2025 and 2024, the Company and its subsidiaries were in compliance with all of the Credit Agreement’s covenants.

During the years ended December 31, 2025 and 2024, no amounts were drawn down on the Company’s Credit Agreement.

As of the years ended December 31, 2025 and 2024, no amounts were outstanding under the Credit Agreement.

Convertible Senior Notes due 2026

Convertible Senior Notes

On March 5, 2021, the Company issued approximately $ 948.8 million aggregate principal amount of 0 % convertible senior notes due 2026 (the “2026 Notes”), including the exercise in full by the initial purchasers of their option to purchase up to an additional approximately $ 123.8 million principal amount of the 2026 Notes.

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The net proceeds from the issuance of the 2026 Notes were approximately $ 930.0 million after deducting the initial purchasers’ discounts and transaction costs.

The Company may not redeem the 2026 Notes prior to March 20, 2024.

On or after March 20, 2024, the Company may redeem for cash, all or any portion of the 2026 Notes, at the Company’s option, at a redemption price equal to 100 % of the principal amount of the 2026 Notes to be redeemed, plus accrued and unpaid special interest, if any, to, but excluding, the

redemption date, if the last reported sale price of the Company’s common stock has been at least 130 % of the conversion price for the 2026 Notes then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which the Company provides notice of redemption.

No sinking fund is provided for the 2026 Notes.

Holders of the 2026 Notes may convert their notes at their option at any time prior to the close of business on the business day immediately preceding December 15, 2025, only under the following circumstances:

(i) during any calendar quarter commencing after the calendar quarter ending on June 30, 2021 (and only during such calendar quarter), if the last reported sale price of the Company’s common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130 % of the conversion price for the 2026 Notes on each applicable trading day;

(ii) during the five business day period after any ten consecutive trading day period (the “Measurement Period”) in which the trading price, as defined in the indenture agreement governing the Note filed with the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on March 5, 2021, per $1,000 principal amount of notes for each trading day of the Measurement Period was less than 98 % of the product of the last reported sale price of the Company’s common stock and the conversion rate on each such trading day;

(iii) if the Company calls such 2026 Notes for redemption, at any time prior to the close of business on the scheduled trading day immediately preceding the applicable redemption date, but only with respect to the 2026 Notes called (or deemed called) for redemption;

or (iv) upon the occurrence of specified corporate events.

On or after December 15, 2025 until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert all or any portion of their notes at any time, regardless of the foregoing circumstances.

Upon conversion, the Company may satisfy its conversion obligation by paying or delivering, as the case may be, cash, shares of its common stock or a combination of cash and shares of its common stock, at the Company’s election.

The initial conversion rate is 9.7272 shares of common stock per $1,000 principal amount of 2026 Notes, equivalent to an initial conversion price of approximately $ 102.80 per share of common stock.

The conversion rate is subject to adjustment as described in the indenture governing the 2026 Notes but will not be adjusted for any accrued and unpaid special interest.

In addition, following certain corporate events that occur prior to the maturity date of the 2026 Notes or if the Company delivers a notice of redemption in respect of the 2026 Notes, the Company will, in certain circumstances, increase the conversion rate of the 2026 Notes for a holder who elects to convert its 2026 Notes, in connection with such a corporate event or convert its 2026 Notes called (or deemed called) for redemption during the related redemption period, as the case may be.

The indenture includes customary covenants and sets forth certain events of default after which the 2026 Notes may be declared immediately due and payable and sets forth certain types of bankruptcy or insolvency events of default involving the Company after which the 2026 Notes become automatically due and payable.

If the Company undergoes a fundamental change, as defined in the indenture agreement governing the 2026 Notes, then subject to certain conditions and except as described in the indenture governing the 2026 Notes, holders may require the Company to repurchase for cash all or any portion of their 2026 Notes at a fundamental change repurchase price equal to 100 % of the principal amount of the 2026 Notes to be repurchased, plus accrued and unpaid special interest, if any, to, but excluding, the fundamental change repurchase date.

The Company evaluated the terms of the 2026 Notes and concluded that the conversion feature does not require separation and that there were no other derivatives that required separation.

As such, the Company has combined these features with the host contract and the Company accounts for the 2026 Notes as a single liability in long-term debt on its consolidated balance sheet.

The initial purchasers’ discounts and transaction costs of $ 18.6 million incurred related to the issuance of the 2026 Notes were classified as a contra-liability and represents the difference between the principal and carrying amount of the 2026 Notes, which is amortized to interest expense using the effective interest method over the term of the 2026 Notes.

As of December 31, 2024, the conversion conditions had not been met and therefore the 2026 Notes were not yet convertible.

On May 25, 2022, the Company entered into separate, privately negotiated transactions with certain holders of the 2026 Notes to repurchase (the “Repurchases”) $ 235.0 million aggregate principal amount of the 2026 Notes for an aggregate cash repurchase price of $ 176.4 million and aggregate transaction costs of $ 0.7 million.

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During the year ended December 31, 2023, the Company entered into several separate privately negotiated transactions with certain holders of the 2026 Notes to repurchase $ 367.3 million aggregate principal amount of the 2026 Notes for an aggregate cash repurchase price of $ 309.1 million and aggregate transaction costs of $ 2.0 million.

The Repurchases were accounted for as a debt extinguishment that resulted in a net gain of $ 52.4 million, which was recorded as non-operating income on the Company’s consolidated statement of operations for the year ended December 31, 2023.

During the year ended December 31, 2024, the Company entered into separate, privately negotiated transactions with certain holders of the 2026 Notes to exchange $ 157.9 million aggregate principal amount of the 2026 Notes for $ 150.0 million aggregate principal amount of 7.75 % convertible senior notes due 2028 (the “2028 Notes”), which were issued in a private placement to qualified institutional buyers pursuant to Rule 144A under the Securities Act.

The exchange was accounted for as a debt extinguishment and an issuance of new debt that resulted in a net gain of $ 1.4 million, which was recorded as non-operating income on the Company’s consolidated statement of operations for the year ended December 31, 2024.

Convertible Senior Notes due 2028

The 2028 Notes will accrue interest at a rate of 7.75 % per annum, payable semi-annually in arrears on June 1 and December 1 of each year, beginning on June 1, 2025.

The 2028 Notes will mature on June 1, 2028, unless earlier converted or repurchased.

The principal amount of the 2028 Notes was $ 150.0 million.

During the year ended December 31, 2025, the Company issued $ 180.0 million aggregate principal amount of 0 % convertible senior unsecured notes due in 2030 (the “2030 Notes”) in a private offering to persons reasonably believed to be qualified institutional buyers pursuant to Rule 144A under the Securities Act.

Concurrently with issuance of the 2030 Notes, the Company also entered into separate, privately negotiated transactions with certain holders of the 2026 Notes to repurchase $ 150.0 million aggregate principal amount of the 2026 Notes for an aggregate cash repurchase price of $ 148.9 million.

The repurchase was accounted for as a debt extinguishment and resulted in a net gain of $ 0.9 million, which was recorded as non-operating income on the Company’s consolidated statement of operations for the year ended December 31, 2025.

As of December 31, 2025, the Company's outstanding convertible senior notes (collectively, the "Notes") had a par value totaling $ 368.6 million.

The following table summarizes further details of the Notes:

Notes Issuance Date Maturity Date Principal amount (in thousands) Coupon Interest Rate Effective Interest Rate

March 5, 2021

March 15, 2026

$ 38,594 — % 0.38 %

$ 150,000 7.75 % 7.77 %

December 5, 2025

December 15, 2030

$ 180,000 — % 0.76 %

Redemption Rights of the Notes

The Company may redeem for cash, all or any portion of the 2026 Notes, at the Company’s option, at a redemption price equal to 100 % of the principal amount of the 2026 Notes to be redeemed, plus accrued and unpaid special interest, if any, to, but excluding, the redemption date, if the last reported sale price of the Company’s common stock has been at least 130 % of the conversion price for the 2026 Notes then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which the Company provides notice of redemption.

No sinking fund is provided for the 2026 Notes.

The Company may not redeem the 2028 Notes prior to the maturity date.

Holders of the 2028 Notes may convert their notes at their option at any time prior to the close of business on the business day immediately preceding March 1, 2028, only under the following circumstances:

(i) during any calendar quarter commencing after the calendar quarter ending on March 31, 2025 (and only during such calendar quarter), if the last reported sale price of the Company’s common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130 % of the conversion price for the 2028 Notes on each applicable trading day;

(ii) during the five business day period after any ten consecutive trading day period (the “Measurement Period”) in which the trading price, as defined in the indenture agreement governing the note filed with the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on December 5, 2024, per $1,000 principal amount of notes for each trading day of the Measurement Period was less than 98 % of the product of the last reported sale price of the Company’s common stock and the conversion rate on each such trading day;

or (iii) upon the occurrence of specified corporate events.

On or after March 1, 2028 and prior to the close of business on the scheduled trading day immediately preceding the maturity date, holders may convert all or any portion of their notes at any time, regardless of the foregoing circumstances.

The 2030 Notes may not be redeemed by the Company prior to December 20, 2028.

On or after December 20, 2028, if the common stock price is at least 130 % of the conversion price for the 2030 Notes in effect for at least 20 of any 30 consecutive trading day period, the Company may redeem all or part of the Notes at a redemption price equal to the principal amount and accrued and unpaid interest with at least 35 days’ notice to holders.

If the Company undergoes a fundamental change at any time prior to the maturity date, holders of the Notes will have the right, at their option, to require the Company to repurchase for cash all or any portion of their Notes at a repurchase price equal to 100 % of the principal amount of the Notes to be repurchased, plus accrued and unpaid interest up to, but excluding, the fundamental change repurchase date.

Conversion Rights of the Notes

Prior to the close of business on the business day immediately preceding the conversion date, as noted in the table below, under the following circumstances a holder may exercise their conversion right:

• During any calendar quarter commencing after the calendar quarter ended June 30, 2021 for the 2026 Notes, March 31, 2025 for the 2028 Notes and March 31, 2026 for the 2030 Notes (and only during such calendar quarter), if the last reported sale price of the Company's common stock for at least 20 trading days (whether or not consecutive) during the period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130 % of the conversion price on each applicable trading day;

• During the five business day period after any five consecutive trading day period in which the trading price per $1,000 principal amount of the respective Notes for each trading day of the measurement period was less than 98 % of the product of the last reported sale price of the Company's common stock and the conversion rate on each such trading day;

• Upon the occurrence of specified corporate events.

On or after the respective conversion date, as noted in the table below, holders may convert all or any portion of their respective Notes at any time prior to the close of business on the second scheduled trading day immediately preceding the maturity date.

The initial conversion rate is 50.6568 shares of common stock per $1,000 principal amount of 2028 Notes, equivalent to an initial conversion price of approximately $ 19.74 per share of common stock.

The conversion rate is subject to adjustment as described in the indenture governing the 2028 Notes but will not be adjusted for any accrued and unpaid interest.

In addition, following certain corporate events that occur prior to the maturity date of the 2028 Notes, the Company will, in certain circumstances, increase the conversion rate of the 2028 Notes for a holder who elects to convert its 2028 Notes, in connection with such a corporate event.

The indenture includes customary covenants and sets forth certain events of default after which the 2028 Notes may be declared immediately due and payable and sets forth certain types of bankruptcy or insolvency events of default involving the Company after which the 2028 Notes become automatically due and payable.

If the Company undergoes a fundamental change, as defined in the indenture agreement governing the 2028 Notes, then subject to certain conditions and except as described in the indenture governing the 2028 Notes, holders may require the Company to repurchase for cash all or any portion of their 2028 Notes at a fundamental change repurchase price equal to 100 % of the principal amount of the 2028 Notes to be repurchased, plus accrued and unpaid interest, if any, to, but excluding, the fundamental change repurchase date.

The Company evaluated the terms of the 2028 Notes and concluded that the conversion feature does not require separation and that there were no other derivatives that required separation.

As such, the Company has combined these features with the host contract and the Company accounts for the 2028 Notes as a single liability in long-term debt on its consolidated balance sheet.

The Company determined the fair value of the 2028 Notes on December 5, 2024 to be $ 155.7 million using valuation technique of quoted prices in dealer markets under market approach that resulted in a debt premium of $ 5.7 million.

Transaction costs of $ 5.8 million incurred related to the issuance of the 2028 Notes, partially offset by the aforementioned premium, were recorded as contra-liability and represents the difference between the principal and the carrying amount of the 2028 Notes, which is amortized to interest expense using the effective interest method over the term of the 2028 Notes.

As of December 31, 2024, the conversion conditions had not been met and therefore the 2028 Notes were not yet convertible.

The following table reflects the carrying values of the debt agreements as of December 31, 2024 and 2023 as follows :

Year ended December 31,

(in thousands)

Convertible Senior notes (effective interest rate of 0.38 % for both the years ended December 31, 2024 and 2023 for the 2026 Notes and an effective interest rate of 7.77 % for the year ended December 31, 2024 for the 2028 Notes)

The conversion rights of the Notes are as follows:

Conversion Date

Conversion Rate (1)

Conversion Price per share

December 15, 2025

9.7272 $ 102.80

March 1, 2028

50.6586 $ 19.74

2030 Notes September 16, 2030 65.5136 $ 15.26

(1) The conversion rate for the Notes is established as a number of shares of the Company's common stock per $1,000 principal amount of the Notes, that is equivalent to the conversion price per share, subject to adjustments in certain events.

Upon the occurrence of certain corporate events the Company will increase the conversion rate for a holder that elects to convert its Notes.

As of December 31, 2025, the conversion conditions had not been met by any of the Notes, and therefore were not yet convertible.

Carrying Value of the Notes as of December 31, 2025 and 2024 as follows :

As of December 31, 2025

Principal amount $ 180,000 $ 150,000 $ 38,594

unamortized debt issuance costs ( 6,620 ) ( 98 ) ( 37 )

Net carrying amount

173,380 149,902 38,557

As of December 31, 2024

Principal amount — 150,000 188,594

unamortized debt issuance costs — ( 77 ) ( 903 )

current portion of long-term debt — —

Long-term debt, less current portion

Net carrying amount

— 149,923 187,691

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As of December 31, 2025 and 2024, the total estimated fair value of the Company's convertible senior notes were $ 379.5 million and $ 327.7 million, respectively.

In connection with the pricing of the issuance of the 2030 Notes, the Company entered into the Capped Calls.

The Capped Calls associated with the 2030 Notes each had an initial strike price of approximately $ 15.26 per share.

These Capped Calls had initial cap prices of $ 23.04 per share, subject to certain adjustments.

The Capped Calls are expected to partially offset the potential dilution to the Company’s common stock upon any conversion of the 2030 Notes, with such offset subject to a cap based on the cap price.

The Capped Calls are subject to adjustment upon the occurrence of specified extraordinary events affecting the Company, including merger events, tender offers and the announcement of such events.

In addition, the Capped Calls are subject to certain specified additional disruption events that may give rise to a termination of the Capped Calls, including nationalization, insolvency or delisting, changes in law, failures to deliver, increased cost of hedging and hedging disruptions.

For accounting purposes, the Capped Calls are separate transactions and not part of the terms of the 2030 Notes.

As these transactions meet certain accounting criteria, the Capped Calls are recorded in stockholders' equity resulting in a $ 18.2 million decrease in additional paid in capital.

Commitments and Contingencies

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(in thousands)

2025 $ 39,905 $ 7,366 $ 47,271

Year ending December 31,

2026 $ 59,276 $ 21,668 $ 80,944

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In accordance with GAAP, the Company has recorded a provision for its tax exposure in these jurisdictions when it is both probable that a liability has been incurred and the amount of the exposure can be reasonably estimated.

The Company has accrued $ 4.3 million as of both December 31, 2024 and 2023, for sales and use tax.

The Company has accrued $ 4.8 million and $ 4.3 million as of December 31, 2025 and 2024, respectively, for sales and use tax.

These estimates are based on several key assumptions, including the taxability of the Company’s operations and the jurisdictions in which the Company believes it has nexus.

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From time to time, the Company has been and may be subject to legal proceedings and claims.

Such matters are subject to many uncertainties and outcomes are not predictable with assurance.

Such matters are subject to many uncertainties and outcomes are not predictable.

The Company accrues for contingencies when it believes that a loss is probable and that the Company can reasonably estimate the amount of any such loss.

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Defendants filed a motion to dismiss on January 15, 2025.

Lead Plaintiff filed an opposition to the defendants’ motion to dismiss on March 17, 2025.

Defendants filed a reply in support of the motion to dismiss on April 30, 2025.

On September 24, 2025, the court issued an order granting in part and denying in part the motion to dismiss.

On October 24, 2025, Lead Plaintiff filed a second amended complaint.

On December 9, 2025, Defendants filed a motion to dismiss the second amended complaint.

On January 26, 2026, Lead Plaintiff filed an opposition.

Defendants filed a reply in support of the motion to dismiss the second amended complaint on February 19, 2026.

A hearing is scheduled for April 30, 2026 on Defendants’ motion to dismiss the second amended complaint.

It is possible that additional lawsuits will be filed, or allegations made by stockholders, regarding these same or other matters and also naming as defendants the Company and its officers and directors.

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The derivative complaints are based on substantially similar allegations as those in the securities class action.

The derivative complaints assert that defendants breached their fiduciary duties as directors and/or officers of the Company, as well as claims of unjust enrichment, abuse of control, gross mismanagement, waste of corporate assets, violations of Section 14(a) of the Exchange Act, and contribution under Sections 10(b) and 21D of the Exchange Act.

On September 17, 2024, the court consolidated and stayed the derivative actions until after resolution of the Company’s motion to dismiss in the above-referenced securities class action.

On August 23, 2024, a substantially similar stockholder derivative complaint was filed against certain of the Company’s officers and directors in the United States District Court for the District of Delaware, captioned Mark Sweitzer v.

Section 14(a) of the Exchange Act, and contribution under Sections 10(b) and 21D of the Exchange Act.

The court consolidated and stayed the derivative actions until after resolution of the Company’s motion(s) to dismiss in the above-referenced securities class action.

Nightingale, et al.

1:24-cv-00969-GBW) (the “Sweitzer Action”).

On September 26, 2024, the court stayed the Sweitzer Action until after resolution of the Company's motion to dismiss in the above-referenced securities class action.

On December 20, 2024, a substantially similar stockholder derivative complaint was filed against certain of the Company’s officers and directors in the United States District Court for the District of Delaware, captioned Bushansky v.

On September 26, 2024, the court stayed the Sweitzer Action until after resolution of the Company's motion(s) to dismiss in the above-referenced securities class action.

On December 20, 2024, a substantially similar stockholder derivative complaint was filed against certain of the Company’s officers and directors in the Court of Chancery for the State of Delaware, captioned Bushansky v.

Nightingale, et al.

2024-1322) (the “Bushansky Action”).

On January 8, 2024, the court stayed the Bushansky Action until after resolution of the Company's motion to dismiss in the above-referenced securities class action.

On January 8, 2025, the court stayed the Bushansky Action until after resolution of the Company’s motion(s) to dismiss in the above-referenced securities class action.

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Equity Incentive Plans

The Company maintains four equity incentive plans:

the 2019 Equity Incentive Plan (the “2019 Plan”), 2011 Equity Incentive Plan (“2011 Plan”), Employee Stock Purchase Plan and the Signal Sciences Corp.

2014 Stock Option and Grant Plan, as amended (the “Signal Plan”).

The Company maintains five equity incentive plans:

the 2019 Equity Incentive Plan (the “2019 Plan”), 2011 Equity Incentive Plan (“2011 Plan”), 2019 Employee Stock Purchase Plan (“ESPP Plan”), the Signal Sciences Corp.

2014 Stock Option and Grant Plan, as amended (the “Signal Plan”), and the 2025 Employment Inducement Incentive Plan (the "2025 Inducement Plan").

The 2019 Plan became effective in May 2019 and replaced the 2011 Plan.

The Company’s 2019 Plan provides for the issuance of incentive stock options, non-statutory stock options, stock appreciation rights, restricted stock units (“RSUs”), restricted stock awards, performance-based stock awards (“PSUs”), and other forms of equity compensation, which are collectively referred to as stock awards to its employees, directors, and consultants.

The Company’s 2019 Plan provides for the issuance of incentive stock options, non-statutory stock options, restricted stock units, performance-based stock awards, and other forms of equity compensation, which are collectively referred to as stock awards to its employees, directors, and consultants.

The Signal Plan includes 251,754 registered shares which can be exercised to purchase shares of Fastly’s common stock.

As of December 31, 2024 and 2023, there were 6.9 million and 8.9 million common stock available for issuance under the 2019 Plan, respectively.

The 2025 Inducement Plan provides for the grant of non-statutory stock options, restricted stock units, performance based stock awards, and other forms of equity compensation.

As of December 31, 2025 and 2024, there were 5.8 million and 6.9 million shares of common stock available for issuance under the 2019 Plan, respectively.

As of December 31, 2025 a total of 0.5 million shares were available for grant under the 2025 Inducement Plan.

As of December 31, 2025 and 2024, 151.5 million and 142.1 million shares of common stock were issued and outstanding, respectively.

Stock Options

Options granted under the 2011 Plan and 2019 Plan are exercisable for common stock and generally expire within 10 years from the date of grant and generally vest over four years , at the rate of 25 % on the first anniversary of the date of grant and ratably on a monthly basis over the remaining 36-month period thereafter based on continued service.

Options granted under the 2011 Plan and 2019 Plan are exercisable for common stock and expire within 10 years from the date of grant and generally vest over four years , at the rate of 25 % on the first anniversary of the date of grant and ratably on a monthly basis over the remaining 36-month period thereafter based on continued service.

Forfeitures are recognized as they occur.

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The total grant date fair value of employee options vested for the years ended December 31, 2025, 2024, 2023 was $ 1.7 million, $ 1.9 million, and $ 2.1 million, respectively.

The weighted-average grant date fair value for options granted to employees during the years ended December 31, 2023 was $ 10.97 .

The Company did not grant any options for the years ended December 31, 2024.

The Company estimates the fair value of stock options on the date of grant using the Black-Scholes option-pricing model.

The Company did not grant any options for the years ended December 31, 2024.

The Company estimated the fair value of stock option awards during the year ended December 31, 2023 on the date of the grant using the Black-Scholes option pricing model with the following weighted-average assumptions:

Year ended December 31,

Fair value of common stock $ 16.47

Expected term (in years) 5.96

Risk-free interest rate 4.67 %

Expected volatility 71.2 %

Dividend yield — %

During the years ended December 31, 2025 and 2024, and 2023, the Company recognized stock-based compensation expense from stock options of approximately $ 1.7 million, $ 1.9 million, and $ 2.1 million, respectively.

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This unrecognized stock-based compensation cost is expected to be recognized over a weighted-average period of approximately 1.6 years.

Restricted Stock Units (“RSUs”)

The Company began granting RSUs under the 2019 Plan during the fiscal year ended December 31, 2019.

Restricted Stock Units

The Company began granting RSUs under the 2019 Plan during the fiscal year ended December 31, 2019 as well as under the 2025 Inducement Plan during the year ended December 31, 2025.

The fair value of RSUs is based on the grant date fair value and is expensed on a straight-line basis over the applicable vesting period.

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This unrecognized stock-based compensation cost is expected to be recognized over a weighted-average period of approximately 2.2 years.

Stock Subject to Revest (“Revest Shares”)

In conjunction with a prior acquisition in fiscal 2020, a restriction was placed on 896,499 shares belonging to the three co-founders of the target which are subject to revesting on a quarterly basis over a 2-year period.

The Company did no t recognize any stock-based compensation expense related to revest shares for the years ended December 31, 2024 and 2023.

For the year ended December 31, 2022, the Company recognized stock-based compensation expense related to revest shares of $ 27.6 million.

As of December 31, 2024, there is no unrecognized stock-based compensation cost related to revest shares.

On January 24, 2022, the Company entered into an agreement with certain holders of restricted stock, who had sold their awards in advance of their vesting conditions, in order to return the proceeds associated with the remaining 224,124 unvested shares as of December 31, 2021.

These stockholders are eligible to continue vesting under the original agreements as long as they have continued service as either an employee or consultant.

On January 31, 2022, the Company received $ 10.7 million from these stockholders related to the settlement of the matter, which the Company classified as unrestricted cash on its consolidated balance sheets.

This amount will similarly be returned to the holders in accordance with the vesting under the original agreements.

Correspondingly, the Company reclassified the award from equity to liability as the award will now be settled for the fixed monetary amount received, rather than a release of the restrictions on shares.

The modification did not result in any incremental expense to be recognized.

In February 2022, one of the stockholders had a change in employment status and the Company accelerated the remaining stock-based compensation associated with his awards on his last day of service as an employee as his services under the modified arrangement were not substantive.

For the year ended December 31, 2022, the Company recognized stock-based compensation expense of $ 5.6 million associated with the modification of these awards, which is included in the total stock-based compensation expense.

For the years ended December 31, 2024 and 2023, the Company did no t recognize any stock-based compensation expense associated with the modification of these awards.

Performance-Based Restricted Stock Units ("PSUs")

Performance-Based Restricted Stock Units

Performance Stock Awards for Executive Officers ("executive PSUs”)

In February 2022, pursuant to the Company’s 2019 Equity Incentive Plan, the Company granted certain employees shares of executive PSUs, which are to vest based on the level of achievement of certain Company-wide targets related to the Company’s operating plan for the fiscal year 2022.

The Company has accounted for these awards as equity-based awards and will recognize stock-based compensation expense over the employees’ requisite service period based on the expected attainment of the Company-wide targets as of the end of each reporting period.

In March and May, 2023, pursuant to the Company’s 2019 Equity Incentive Plan, the Company granted certain employees shares of executive PSUs, which are to vest based on the level of achievement of certain Company-wide targets related to the Company’s operating plan for the fiscal year 2023.

In February 2024, pursuant to the Company’s 2019 Equity Incentive Plan, the Company granted certain employees shares of PSUs, which are to vest based on the level of achievement of certain Company-wide targets related to the Company’s operating plan for the fiscal year 2024.

Pursuant to the Company’s 2019 Equity Incentive Plan, the Company grants certain employees shares of executive PSUs, which are to vest based on the level of achievement of certain Company-wide targets related to the Company’s operating plan for the relevant fiscal year.

2 unchanged sentences

Nonvested executive PSUs as of December 31, 2024

1,089 $ 13.21

Granted 1,901 6.89

2 unchanged sentences

Nonvested executive PSUs as of December 31, 2025

1,089 $ 13.21

For the years ended December 31, 2025, 2024 and 2023, the Company recognized $ 3.9 million, $ 3.5 million, and $ 4.3 million of stock-based compensation expense associated with these awards, respectively.

Company-wide Bonus Program (“Bonus Program”)

In February 2022, the Compensation Committee approved a company-wide bonus program, including performance targets, to most of the Company’s employees on active payroll in fiscal year 2022.

Shares awarded under the program were paid out in February 2023 in fully vested RSUs and based on the final attainment of Company-wide performance targets which were tied to its operating plan for fiscal year 2022.

The Company recognized stock-based compensation expense over the employees requisite service period, based on the final attainment of the Company-wide targets.

In February 2023, the Company paid out the bonus liability associated with the 2022 Bonus Program in 1.2 million of restricted stock units, and correspondingly recorded a charge to additional paid-in-capital of $ 16.6 million.

In March 2023, the Compensation Committee approved a company-wide bonus program, including performance targets, to most of the Company’s employees on active payroll in fiscal year 2023.

Shares awarded under the program were paid out in February 2024 in fully vested RSUs and based on the final attainment of Company-wide performance targets which were tied to its operating plan for fiscal year 2023.

The Company recognized stock-based compensation expense over the employees requisite service period, based on the final attainment of the Company-wide targets.

In February 2024, the Company paid out the bonus liability associated with the 2023 Bonus Program in 1.9 million of restricted stock units, and correspondingly recorded a charge to additional paid-in-capital of $ 26.8 million.

In February 2024, the Compensation Committee approved a company-wide bonus program, including performance targets, to most of the Company’s employees on active payroll in fiscal year 2024.

Shares awarded under the program will be in fully vested RSUs and will be based on the final attainment of Company-wide performance targets which are tied to its operating plan for fiscal year 2024.

The payout of the 2024 Company-wide bonus program will vary linearly between 50 %, 100 % and 150 % based on the achievement of these targets.

Employees are required to be employed through the payout date to

earn the awards.

On an annual basis the Compensation Committee approves a bonus program for the fiscal year, including performance targets, to most of the Company’s employees on active payroll in the relevant fiscal year.

Shares awarded under the program are paid out the following year in February in fully vested RSUs and based on the final attainment of Company-wide performance targets which are tied to its operating plan for the relevant fiscal year.

The payout of the Bonus Program will vary linearly between 50 %, 100 %, and 150 % based on the achievement of these targets.

Employees are required to be employed through the payout date to earn the awards.

The Company has accounted for these awards as liability-based awards, since the monetary value of the obligation associated with the award is based predominantly on a fixed monetary amount known at inception, and it has an unconditional obligation that it must or may settle by issuing a variable number of its equity shares.

The Company is recognizing the stock-based compensation expense over the employees requisite service period, based on the expected attainment of the Company-wide targets as of the end of each reporting period.

During the years ended December 31, 2024, 2023 and 2022, the Company recognized $ 10.0 million, $ 24.7 million and $ 14.9 million of stock-based compensation expense associated with the Bonus Programs, respectively.

Market-Based Performance Stock Awards (“MPSUs”)

The Company recognizes stock-based compensation expense over the employees requisite service period, based on the expected attainment of the Company-wide targets as of the end of each reporting period.

In February 2025, the Company paid out 1.0 million of restricted stock units associated with the 2024 Bonus Program, and correspondingly recorded a charge to additional paid-in-capital of $ 6.9 million.

The Company has paid out the Bonus Program approved in February 2025 in February 2026.

During the years ended December 31, 2025, 2024 and 2023, the Company recognized $ 35.3 million, $ 10.0 million, and $ 24.7 million of stock-based compensation expense related to the company-wide Bonus Program, respectively.

Market-Based Performance Stock Awards

In September 2022 and January 2023, pursuant to the Company’s 2019 Equity Incentive Plan, the Company granted certain employees shares of MPSUs, which are to vest upon the satisfaction of the Company’s achievement of specified Fastly common stock price targets during the applicable performance period.

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Stock-based compensation expense relating to the MPSUs are recognized using the accelerated attribution method over the derived service period.

For the years ended December 31, 2024, 2023 and 2022, the Company recognized $ 2.8 million, $ 5.9 million and $ 2.1 million of stock-based compensation expense associated with these awards, respectively.

For the years ended December 31, 2025, 2024 and 2023, the Company recognized $ 3.0 million of stock-based compensation benefit and $ 2.8 million and $ 5.9 million of stock-based compensation expense associated with these awards, respectively.

Total unrecognized stock-based compensation expense related to the unvested portion of the MPSUs was $ 0.1 million as of December 31, 2025.

This expense is expected to be amortized over a weighted-average vesting period of 1.9 years.

Employee Stock Purchase Program (“ESPP”)

Relative Total Shareholder Return Award PSUs

In 2025, pursuant to the 2019 Plan, the Company granted certain employees shares of rTSR PSUs, which are to vest based on the Company’s total shareholder return (TSR) relative to a designated peer group over the performance period.

Company has accounted for these awards as equity-based awards and will recognize stock-based compensation expense on a straight-line basis over the vesting period.

In addition, the awards are subject to each recipient’s continuous service through the vest date.

Number of Shares Weighted-Average Grant Date Fair Value Per Share

(in thousands)

Nonvested rTSR PSUs as of December 31, 2024

Granted 372 14.05

Cancelled/forfeited ( 109 ) 13.47

Nonvested rTSR PSUs as of December 31, 2025

During the year ended December 31, 2025, the Company recognized $ 1.0 million of stock-based compensation expense associated with these awards.

Employee Stock Purchase Program

The ESPP allows eligible employees to purchase shares of the Company’s common stock through payroll deductions of up to 15 % of their eligible compensation.

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The inputs to the Black-Scholes option pricing model are the Company’s stock price on the first date of the offering period, the risk-free interest rate, the estimated volatility of the Company’s stock price over the term of the offering period, the expected term of the offering period and the expected dividend rate.

Stock-based compensation

expense related to the ESPP is recognized on a straight-line basis over the offering period.

Stock-based compensation expense related to the ESPP is recognized on a straight-line basis over the offering period.

Forfeitures are recognized as they occur.

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Equity Awards Modification

There were no material equity modifications in the year ended December 31, 2024.

In September 2023, as part of one employee's separation and transition plan, the Company modified this employee’s outstanding equity awards in an amount that would have vested if this individual had remained an employee for an additional period of time.

As a result of the modification, the Company recognized stock-based compensation expense of $ 2.0 million for the year ended December 31, 2023.

In September 2022, as part of one employee's separation and transition plan, the Company modified this employee’s outstanding equity awards in an amount that would have vested if this individual had remained an employee for an additional period of time.

As a result of the modification, the Company recognized stock-based compensation expense of $ 3.1 million for the year ended December 31, 2022.

There were no material equity award modifications in the years ended December 31, 2025, 2024 and 2023.

Stock-based Compensation Expense

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For the years ended December 31, 2025, 2024 and 2023, the Company capitalized $ 7.4 million, $ 10.3 million, and $ 10.1 million of stock-based compensation expense, respectively.

For the years ended December 31, 2024 and 2023, the Company recognized $ 10.0 million and $ 24.7 million of stock-based compensation expense associated with liability classified awards related to the company-wide Bonus Program, respectively.

For the year ended December 31, 2022, the Company recognized $ 25.5 million of stock-based compensation expense associated with liability classified awards related to the company-wide Bonus Program and certain of the Company’s Revest Shares that were modified.

Net Loss Per Share Attributable to Common Stockholders

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Diluted net loss per share is computed by dividing net loss by diluted weighted-average shares outstanding, including potentially dilutive securities.

The following table presents the computation of basic and diluted net loss per share of common stock (in millions, except per share data):

The following table presents the computation of basic and diluted net loss per share of common stock:

Year ended December 31,

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MPSUs 335 1,313 1,471

rTSR PSUs 263 — —

Bonus PSUs 4,054 767 1,572

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Total tax expense (benefit) $ 2,488 $ 2,604 $ ( 221 )

Reconciliation between the Company’s effective tax rate on income from continuing operations and the U.S.

federal statutory rate is as follows:

The Company recorded tax expense of $ 2.5 million and $ 2.6 million for the years ended December 31, 2025 and 2024, respectively, and recorded tax benefit of $ 0.2 million for the year ended December 31, 2023.

The Company’s income tax expense (benefit) is primarily due to income taxes from certain foreign jurisdictions where the Company conducts business and state minimum income taxes in the United States.

The Company adopted ASU 2023-09 "Income Taxes (Topic 740):

Improvements To Income Tax Disclosures" on a retrospective basis effective December 31, 2025.

The following table presents required disclosure pursuant to ASU 2023-09 and reconciles the U.S.

federal statutory tax amount and rate to the Company's actual global effective amount and rate for the years ended December 31, 2025, 2024, and 2023:

Year ended December 31,

2025 2024 2023

Provision at federal statutory tax rate 21 % 21 % 21 %

(in thousands) Percent Amount

(in thousands) Percent

US federal statutory tax rate

$ ( 25,030 ) 21.0 % $ ( 32,645 ) 21.0 % $ ( 27,995 ) 21.0 %

State and local income taxes, net of federal income tax effect*

( 543 ) 0.5 % ( 519 ) 0.3 % ( 985 ) 0.7 %

Foreign tax effects:

United Kingdom:

Change in valuation allowance — — % — — % ( 2,080 ) 1.6 %

Foreign tax rate differential ( 1 ) 1 —

Stock-based compensation ( 7 ) ( 4 ) ( 9 )

685 ( 0.6 ) % 1,160 ( 0.7 ) % 197 ( 0.1 ) %

Other foreign jurisdictions

280 ( 0.2 ) % 125 ( 0.1 ) % 504 ( 0.4 ) %

Effect of changes in tax laws or rates enacted in the current period

Effect of cross-border tax laws

678 ( 0.6 ) % 52 ( 0.1 ) % — — %

Research and development credits ( 4,985 ) 4.2 % ( 8,671 ) 5.6 % ( 18,444 ) 13.8 %

Changes in valuation allowances

19,627 ( 16.5 ) % 26,675 ( 17.2 ) % 33,410 ( 25.1 ) %

Nontaxable or nondeductible items:

Stock-based compensation awards

7,582 ( 6.4 ) % 10,492 ( 6.7 ) % 4,824 ( 3.6 ) %

Disallowed executive compensation 1,784 ( 1.5 ) % 2,483 ( 1.6 ) % 3,922 ( 2.9 ) %

586 ( 0.5 ) % 695 ( 0.4 ) % 517 ( 0.4 ) %

Restructuring — — —

Effective tax rate ( 2 ) % — % — %

The Company recorded tax expense of $ 2.6 million and a tax benefit of $ 0.2 million for the years ended December 31, 2024 and 2023, respectively, and recorded tax expense of $ 0.1 million for the year ended December 31, 2022.

Changes in unrecognized tax benefits

1,824 ( 1.5 ) % 2,757 ( 1.8 ) % 5,909 ( 4.4 ) %

$ 2,488 ( 2.1 ) % $ 2,604 ( 1.7 ) % $ ( 221 ) 0.2 %

*State taxes in California made up the majority (greater than 50%) of the tax effect in this category

The Company’s deferred tax assets and liabilities were as follows:

4 unchanged sentences

Lease liability 18,255 17,329

17,329 20,137

Research and development credits 52,060 46,759

5 unchanged sentences

Deferred tax assets 351,566 332,076

Deferred tax liabilities:

Intangible asset amortization ( 6,320 ) ( 10,995 )

Right-of-use asset ( 13,814 ) ( 13,377 )

( 13,377 ) ( 15,322 )

( 14,844 ) ( 13,032 )

State taxes ( 16,066 ) ( 14,844 )

Prepaid commissions ( 11,473 ) ( 13,306 )

( 13,306 ) ( 13,868 )

Other ( 17 ) ( 1 )

Deferred tax liabilities ( 47,690 ) ( 52,523 )

22 unchanged sentences

The Company expects to maintain this valuation allowance for the foreseeable future.

During the year ended December 31, 2024, the valuation allowance related to the Company’s U.S.

deferred tax assets increased by $ 33.7 million.

Utilization of the net operating loss carryforwards may be subject to a substantial annual limitation due to the ownership change limitations under the Code and similar state provisions.

Changes in the valuation allowance were as follows:

As of December 31,

2025 2024 2023

(in thousands)

Beginning balance $ 279,204 $ 245,476 $ 208,215

Additions charged to expenses

24,081 33,728 37,261

Ending balance $ 303,285 $ 279,204 $ 245,476

Utilization of the NOL carryforwards may be subject to a substantial annual limitation due to the ownership change limitations under the Code and similar state provisions.

Under Section 382 of the Code, a corporation that undergoes an “ownership change” may be subject to limitations on its ability to utilize its pre-change NOLs to offset future taxable income.

A detailed analysis was performed through December 31, 2021 for the Company to determine whether an ownership change under Section 382 of the Code has occurred, and ownership changes were identified in 2013 and 2020.

As a result of this analysis, the Company concluded that there is no longer any limitation on the utilization of such NOLs.

A detailed analysis was completed through December 31, 2024 and no further ownership changes were identified.

As a result of these analyses, the Company concluded that there is no longer any limitation on the utilization of such NOLs.

A detailed analysis was performed for the period March 1, 2014 to October 1, 2020 for Signal Sciences to determine whether an ownership change under Section 382 of the Code has occurred and an ownership change was identified in 2020.

13 unchanged sentences

The unrecognized tax benefits, if recognized and in absence of full valuation allowance, would impact the income tax provision by $ 27.8 million and $ 26.0 million at December 31, 2025 and 2024, respectively.

As of December 31, 2024, the Company believes that it is reasonably possible that its unrecognized tax benefits will decrease by $ 4.3 million in the following 12 months.

The Company’s policy is to recognize interest and penalties associated with uncertain tax benefits as part of the income tax provision and include accrued interest and penalties with the related income tax liability on its consolidated balance sheet.

To date, t he Company has not recognized any interest and penalties in its consolidated statements of operations, nor has it accrued for or made payments for interest and penalties.

Generally, in the U.S.

federal and state taxing jurisdictions, tax periods in which certain loss and credit carryovers are generated remain open for audit until such time as the limitation period ends for the year in which such losses or credits are utilized.

The Company adopted ASU 2023-09 on a retrospective basis effective December 31, 2025 and have included the following tables as a result of the Company's adoption, which presents income taxes paid (net of refunds received) for the years ended December 31, 2025, 2024 and 2023:

Year ended December 31,

2025 2024 2023

(in thousands)

$ 55 $ 129 $ 41

Foreign 1,282 680 290

$ 1,337 $ 809 $ 331

Income taxes paid (net of refunds) exceed 5% of total income taxes paid (net of refunds) in the following jurisdictions:

Year ended December 31,

2025 2024 2023

(in thousands)

*Jurisdiction below the threshold for the period presented .

Segment and Geographic Information

18 unchanged sentences

These charges are included within the restructuring charges line in the Company's consolidated statements of operations.

The plan was substantially completed by December 31, 2024.

The following table presents activity related to the liability, which is recorded in accrued expenses in the Company's consolidated balance sheet, for restructuring-related employee severance and benefits:

(in thousands)

Balance as of January 1, 2024

Restructuring charges

Cash payments ( 9,560 )

Balance as of December 31, 2024

The plan was completed by December 31, 2025 with no remaining unpaid balances, as the plan was materially paid out by December 31, 2024.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

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

What changed 10-K

Item 8. Financial Statements and Supplementary Data