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Item 7. Management’s Discussion and Analysis

2026-03-09 compared with 2025-03-07 · 217 added, 130 removed, 299 unchanged (54% of the section changed)

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The discussion and analysis below presents our historical results as of and for the years ended on, the dates indicated.

The historical financials below, for the period prior to the Business Combination, are those of GBT JerseyCo Limited and its subsidiaries that became predecessors of GBTG upon the consummation of the Business Combination and, depending on the context, “we,” “us,” or “our,” could mean GBT JerseyCo and its subsidiaries or GBTG and its subsidiaries.

Unless otherwise indicated or the context otherwise requires, the terms , “we,” “us,” or “our,” refer to GBTG and its subsidiaries.

A discussion regarding our financial condition and results of operations for the year ended December 31, 2024 compared to the year ended December 31, 2023 can be found in "Part II, Item 7.

Management’s Discussion and Analysis of Financial Condition and Results of Operations,” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024 , as filed with the SEC on March 7, 2025.

We operate American Express Global Business Travel, a leading software and services company for travel, expense, and meetings & events.

We have built one of the most valuable marketplaces in travel with comprehensive and competitive content.

We offer a choice of software solutions for customers to access the Amex GBT marketplace, backed up by global teams for 24/7 support in over 140 countries.

We service our clients in the following ways:

• The Amex GBT Marketplace is our proprietary capability to provide travel suppliers with efficient access to business travel clients serviced by our diverse portfolio of leading travel management solutions and Network Partners.

We believe this access allows travel suppliers to benefit from premium demand (which we generally view as demand that is differentially valuable and profitable to suppliers) without incurring the costs associated with directly marketing to, and servicing the complex needs of, our business clients.

Our travel supplier relationships generate efficiencies and cost savings that can be passed on to our business clients, delivering access to extensive and competitive content including exclusive negotiated content.

• Our award-winning client facing travel and expense solutions are built to deliver business value through optimized user experiences across business travel and are comprised of Neo1, Egencia, Select and Ovation.

These solutions are accessible over web and mobile interfaces, powered by our data management infrastructure and built by our dedicated product engineering team who is committed to driving technical innovation across the business travel industry.

• GBT Partner Solutions is our program whereby we extend our platform to third-party TMCs and independent advisors (collectively, "Network Partners"), by offering them access to our differentiated content and technology, global servicing capabilities and access to our leading content marketplace ("GBT Partner Solutions").

Through GBT Partner Solutions, we aggregate business travel demand serviced by our Network Partners at low incremental cost, which we believe enhances the economics of our platform, generates increased return on investment and expands our geographic and segment footprint.

GBTG is a Delaware corporation and tax resident in the United States.

GBTG conducts its business through GBT JerseyCo, which until July 10, 2023, was through an Up-C structure.

On July 10, 2023, GBTG entered into a series of transactions that simplified the capital and organizational structure by eliminating the Up-C structure.

See note 7 — Certain Corporate Transactions to our consolidated financial statements included elsewhere in this Annual Report.

We operate American Express Global Business Travel, a leading technology and services company for travel, expense, and meetings & events.

We are committed to offering companies and their travelers access to the most valuable marketplace in business travel for one simple reason:

when people come together, great ideas come to life.

We believe business travel is a fundamental driver of progress and innovation that can be both transactional and transformational.

Our comprehensive and competitive marketplace, industry-leading software, AI (as defined herein)-powered efficiencies and 24/7 global support team offer solutions, savings, and flexibility for companies of every size.

We believe this is why Amex GBT is one of the most trusted brands in the industry, dedicated to enabling better business travel.

We serve and create value for clients and travel suppliers in two ways:

(i) by providing the most comprehensive and competitive content through the Amex GBT marketplace, enabling travel through content and distribution, expert service, partnerships, and (ii) by offering the data and insights through a suite of travel and expense software and professional services built on a proprietary AI-powered modern technology platform that enables effective and efficient management of business travel programs..

On September 2, 2025, we completed the acquisition of CWT in accordance with terms of agreement.

On December 29, 2025, we gained control over Uvet Global Business Travel S.p.A.

("Uvet GBT"), by obtaining majority representation on its board of directors.

This was accounted for as a business acquisition under GAAP.

For more information regarding the CWT and Uvet GBT transactions, see note 3 - Business Acquisitions to our consolidated financial statements included elsewhere in this Annual Report).

Macroeconomic conditions and trends

While transactions grew during the year ended December 31, 2025, macroeconomic and political uncertainties such as changing global geopolitical dynamics, changing trade policies and tariffs, risk of recession, inflationary pressures, currency fluctuations, stock market volatility and geopolitical conflicts, have contributed to an increasingly involved business environment and uncertainty in business trends.

Our future operational results may be subject to volatility due to the impact of the aforementioned trends.

Key Factors Affecting Our Results of Operations

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Set forth below is a brief discussion of the key factors impacting the comparability of our results of operations.

Industry Trends

The travel industry can generally be divided into two sectors:

(i) the leisure travel sector, which serves individuals who make reservations for vacation and personal travel, and (ii) the business travel sector, which serves business clients

that require travel by employees and other travelers for business needs and meetings.

We focus primarily on the business travel sector because business travel customers purchase more premium seats, more flexible tickets, more long-haul international trips and more last-minute bookings.

Impact of Acquisition

From time-to-time we pursue accretive acquisitions and have realized substantial growth through our acquisition strategy.

In September 2025, we completed the acquisition of CWT.

CWT is a global business travel and meetings management company that provides corporate travel booking, program management and related services to enterprises and government clients.

Our consolidated financial statements for the year ended December 31, 2025 include the results of the CWT acquisition from the closing date of the transaction.

On December 19, 2025, we entered into an agreement with UVET Viaggi Turismo S.p.A., pursuant to which we are entitled to appoint a majority of the members of the board of directors of Uvet GBT.

On December 29, 2025, we appointed a majority of the members of the board of directors of Uvet GBT pursuant to this agreement, while maintaining our 35% ownership in Uvet GBT, thereby obtaining a controlling financial interest.

Prior to obtaining a controlling interest through our majority representation on the board of directors of Uvet GBT, we accounted for our 35 % ownership in Uvet GBT as an equity method investment.

This transaction was accounted for as a "step acquisition" (as defined by GAAP).

Such acquisitions have an impact on our revenue, cost of revenue and other operating expenses (including integration, restructuring and depreciation and amortization).

Further, purchase accounting under GAAP requires that all assets acquired and liabilities assumed in a business combination be recorded at fair value on the acquisition date.

This could result in a significant amount of amo rtization of acquired intangibles (or impairments, if any) recorded in our results of operations, which may significantly impact our results of operations.

Fair Value Movements for Earnout Shares

We have earnout shares that we record as derivative liabilities, recognizing any fair value movement in the consolidated statements of operations.

We have experienced significant gains or losses on account of fair value movements related to these earnout shares, which has impacted our results of operations.

Foreign Currency Exchange

We have considerable business operations outside of the United States ("U.S.") As we report our results in U.S.

Dollars, we face exposure to movements in foreign currency exchange rates as the financial results and the financial

condition of our businesses outside of the U.S.

are translated from local functional currency into U.S.

As a result of movements in foreign currency exchange rates, the amounts of our foreign-currency denominated net assets, revenues, operating expenses, and net income as expressed in U.S.

Dollars are affected.

However, since our expenses are generally denominated in foreign currencies on a basis similar to our revenues, our operating margins have not been significantly impacted by currency fluctuations.

Further, our results of operations are also affected due to the remeasurement of monetary assets and liabilities denominated in currencies other than the functional currency of entities.

These remeasurement adjustments are recognized in earnings and can result in foreign currency gains or losses, depending on the direction of currency movements.

Period-to-period changes in exchange rates, particularly in the Euro and British Pound, can introduce volatility into our reported financial results, independent of underlying business performance.

While, during the year ended December 31, 2025, we entered into foreign currency forward contracts to economically hedge, in part, risks from such remeasurements, these measures did not fully offset the impact of foreign currency fluctuations on our financial results.

We do not have any foreign currency forward contracts as of December 31, 2025.

Key Operating and Financial Metrics

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Total operating expense 2,588 2,308 280 12 %

Operating income (loss) 115 (8) 123 n/m

Net loss (134) (136) 2 1 %

Net loss margin

1,562 1,397 165 12 %

Gross Profit Margin

57 % 58 % (15)bps — %

Operating income

130 115 15 13 %

Net income (loss) 111 (134) 245 182 %

Net income (loss) margin

4 % (6) % n/m n/m

Net cash from operating activities 233 272 (39) (15) %

Adjusted Gross Profit

1,633 1,456 177 12 %

Adjusted Gross Profit Margin

60 % 60 % 1bps — %

EBITDA 432 257 175 68 %

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We also believe that TTV, followed by Transaction Growth (Decline), may assist potential investors and financial analysts in understanding the drivers of growth in our revenues and changes in our operating expenses across reporting periods.

Following the acquisition of CWT, we updated our methodology to calculate TTV and number of transactions to better align across our platforms to ensure consistency and comparability.

As a result, TTV and Transaction Growth (Decline) metrics for prior periods have been recalculated and presented to conform to the current methodology, with no material impact year-over-year.

TTV refers to the sum of the total price paid by travelers for air, hotel, rail, car rental and cruise bookings, including taxes and other charges applied by suppliers at point of sale, less cancellations and refunds.

For the year ended December 31, 2024, TTV increased by $2,285 million, or 8%, compared to the year ended December 31, 2023.

The increase in TTV was primarily due to Transactions Growth and an increase in average transaction price driven by a higher ticket prices, mix in international transactions and higher hotel room rates.

For the year ended December 31, 2025, TTV increased by $5,229 million, or 17%, compared to the year ended December 31, 2024, with CWT contributing 12% of this growth with the remaining increase in TTV primarily due to Transaction Growth, an increase in both average air transaction price and average hotel stay price and a favorable impact from foreign exchange rates.

Transaction Growth (Decline)

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To calculate year-over-year growth or decline, we compare the total number of net transactions in the comparative previous period/year to the total number of net transactions in the current period in percentage terms.

During 2024, we have amended our definition of Transaction Growth (Decline) and, we have presented Transaction Growth (Decline) on a net basis to exclude cancellations, refunds and exchanges as management believes this better aligns Transaction Growth (Decline) with the way we measure TTV and revenue.

Prior period Transaction Growth percentages have been recalculated and represented to conform to current period presentation.

For the year ended December 31, 2024, Transaction Growth was 5% compared to the year ended December 31, 2023.

Increase in transaction growth for this period was primarily due to share gains and increased demand for business travel from our clients, with strong global multinational customer base performance offset by slower growth in small and medium enterprise customer base.

For the year ended December 31, 2025, Transaction Growth was 14% compared to the year ended December 31, 2024, with CWT contributing to 12% of this growth.

The remaining increase in Transaction Growth for this period was primarily due to share gains and increased demand for business travel from our clients.

Non-GAAP Financial Measures

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These non-GAAP financial measures supplement comparable GAAP measures in the evaluation of the effectiveness of our business strategies, to make budgeting decisions, and/or to compare our performance and liquidity against that of other peer companies using similar measures.

EBITDA , Adjusted EBITDA, Adjusted EBITDA Margin and Adjusted Operating Expenses

Adjusted Gross Profit, Adjusted Gross Profit Margin, EBITDA , Adjusted EBITDA, Adjusted EBITDA Margin and Adjusted Operating Expenses

We define Adjusted Gross Profit as revenue less cost of revenue (excluding depreciation and amortization).

We define Adjusted Gross Profit Margin as Adjusted Gross Profit divided by revenue.

We define EBITDA as net income (loss) before interest income, interest expense, gain (loss) on early extinguishment of debt, benefit from (provision for) income taxes and depreciation and amortization.

We define Adjusted EBITDA as net income (loss) before interest income, interest expense, gain (loss) on early extinguishment of debt, benefit from (provision for) income taxes and depreciation and amortization and as further adjusted to exclude costs that management believes are non-core to the underlying business of the Company, consisting of restructuring, exit and related charges, integration costs, costs related to mergers and acquisitions, non-cash equity-based compensation and related employer taxes, long-term incentive plan costs, certain corporate costs, fair value movements on earnout and warrant derivative liabilities, foreign currency gains (losses) and non-service components of net periodic pension benefit (cost) .

We define Adjusted EBITDA as net income (loss) before interest income, interest expense, gain (loss) on early extinguishment of debt, benefit from (provision for) income taxes and depreciation and amortization and as further adjusted to exclude costs that management believes are non-core to the underlying business of the Company, consisting of restructuring, exit and related charges, integration costs, costs related to mergers and acquisitions, non-cash equity-based compensation and related employer taxes, long-term incentive plan costs, certain corporate costs, fair value movements on earnout derivative liabilities, gain (loss) on remeasurement of previously held equity investment, foreign currency gains (losses) and non-service components of net periodic pension benefit (cost) .

We define Adjusted EBITDA Margin as Adjusted EBITDA divided by revenue.

We define Adjusted Operating Expenses as total operating expenses excluding depreciation and amortization and costs that management believes are non-core to the underlying business of the Company, consisting of restructuring, exit and related charges, integration costs, costs related to mergers and acquisitions, non-cash equity-based compensation and related employer taxes, long-term incentive plan costs and certain corporate costs.

EBITDA, Adjusted EBITDA, Adjusted EBITDA Margin and Adjusted Operating Expenses are supplemental non-GAAP financial measures of operating performance that do not represent and should not be considered as alternatives to net income (loss) or total operating expenses, as determined under GAAP.

Adjusted Gross Profit, Adjusted Gross Profit Margin, EBITDA, Adjusted EBITDA, Adjusted EBITDA Margin and Adjusted Operating Expenses are supplemental non-GAAP financial measures of operating performance that do not represent and should not be considered as alternatives to gross profit, net income (loss) or total operating expenses, as determined under GAAP.

In addition, these measures may not be comparable to similarly titled measures used by other companies.

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• impact on earnings or changes resulting from matters that are non-core to our underlying business, as we believe they are not indicative of our underlying operations.

EBITDA, Adjusted EBITDA, Adjusted EBITDA Margin and Adjusted Operating Expenses should not be considered as measures of liquidity or as measures determining discretionary cash available to us to reinvest in the growth of our business or as measures of cash that will be available to us to meet our obligations.

We believe that the adjustments applied in presenting EBITDA, Adjusted EBITDA, Adjusted EBITDA Margin and Adjusted Operating Expenses are appropriate to provide additional information to investors about certain material non-cash and other items that management believes are non-core to our underlying business.

We further believe that these measures assist investors, potential investors and analysts in evaluating our operating results across reporting periods on a consistent basis.

Set forth below is a reconciliation of net loss to EBITDA and Adjusted EBITDA.

Adjusted Gross Profit, Adjusted Gross Profit Margin, EBITDA, Adjusted EBITDA, Adjusted EBITDA Margin and Adjusted Operating Expenses should not be considered as measures of liquidity or as measures determining discretionary cash available to us to reinvest in the growth of our business or as measures of cash that will be available to us to meet our obligations.

We believe that the adjustments applied in presenting Adjusted Gross Profit, Adjusted Gross Profit Margin, EBITDA, Adjusted EBITDA, Adjusted EBITDA Margin and Adjusted Operating Expenses are appropriate to provide additional information to investors about certain material non-cash and other items that management believes are non-core to our underlying business.

These non-GAAP measures supplement comparable GAAP measures in the evaluation of the effectiveness of our business strategies, to make budgeting decisions, and to compare our performance against that of other peer companies using similar measures.

We also believe that Adjusted Gross Profit, Adjusted Gross Profit Margin, EBITDA, Adjusted EBITDA, Adjusted EBITDA Margin and Adjusted Operating Expenses are helpful supplemental measures to assist potential investors and analysts in evaluating our operating results across reporting periods on a consistent basis.

Set forth below is a reconciliation of Adjusted Gross Profit to Gross Profit.

Year Ended December 31,

(in $ millions) 2025 2024

Revenue $ 2,718 $ 2,423

Cost of revenue (excluding depreciation and amortization)

Adjusted Gross Profit

Depreciation and amortization related to cost of revenue 71 59

$ 1,562 $ 1,397

Gross Profit Margin 57 % 58 %

Adjusted Gross Profit Margin

Set forth below is a reconciliation of net income (loss) to EBITDA and Adjusted EBITDA.

Year Ended December 31, Change

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(in $ millions except percentages) 2025 2024 $ %

Net loss $ (134) $ (136) $ 2 1 %

Interest income (6) (1) (5) n/m

Net income (loss) $ 111 $ (134) $ 245 182 %

Interest income (8) (6) (2) (16) %

Interest expense 95 115 (20) (17) %

Loss on early extinguishment of debt 38 — 38 n/m

Provision for (benefit from) income taxes 66 (9) 75 n/m

Loss on early extinguishment of debt 2 38 (36) (96) %

Provision for income taxes 40 66 (26) (39) %

Depreciation and amortization 192 178 14 8 %

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Mergers and acquisitions (c)

35 45 (10) (23) %

Equity-based compensation and related employer taxes (d)

Fair value movements on earnout derivative liabilities (e)

56 (13) 69 n/m

Other adjustments, net (f)

(96) 56 (152) (271) %

Gain on remeasurement of previously held equity interest (f)

(39) — (39) n/m

Other adjustments, net (g)

32 (4) 36 n/m

Adjusted EBITDA $ 532 $ 478 $ 54 11 %

Net loss margin (1)

(6) % (6) % 40 bps 7 %

Net income (loss) margin (1)

4 % (6) % n/m n/m

Adjusted EBITDA Margin 20 % 20 % (17)bps (1) %

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Mergers and acquisitions (c)

(45) (2) (43) n/m

(35) (45) 10 23 %

Equity-based compensation and related employer taxes (d)

(90) (83) (7) (8) %

Other adjustments, net (f)

Other adjustments, net (g)

(3) (13) 10 81 %

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n/m — not meaningful

(a) Includes (i) employee severance costs of $11 million, and $39 million for the years ended December 31, 2024 and 2023, respectively, (ii) accelerated amortization of operating lease ROU assets of $4 million and $7 million for the years ended December 31, 2024 and 2023, respectively, and (iii) contract costs related to abandoned leased facilities of $2 million and $3 million for the years ended December 31, 2024 and 2023, respectively.

(a) Includes (i) employee severance costs of $48 million, and $11 million for the years ended December 31, 2025 and 2024, respectively, (ii) accelerated amortization of operating lease ROU assets of $6 million and $4 million for the years ended December 31, 2025 and 2024, respectively, and (iii) contract costs related to abandoned leased facilities and other related costs of $4 million and $2 million for the years ended December 31, 2025 and 2024, respectively.

(b) Represents expenses related to the integration of businesses acquired.

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(e) Represents fair value movements on earnout derivative liabilities during the periods.

(f) Adjusted Operating Expenses excludes (i) long-term incentive plan expense of $8 million and $19 million for the years ended December 31, 2024 and 2023, respectively, and (ii) legal and professional services costs of $5 million and $14 million for the years ended December 31, 2024 and 2023, respectively.

Adjusted EBITDA additionally excludes (i) unrealized foreign exchange gains (losses) of $22 million and $(5) million for the years ended December 31, 2024 and 2023, respectively, and (ii) non-service component of our net periodic pension cost related to our defined benefit pension plans of $5 million and $5 million for the years ended December 31, 2024 and 2023, respectively.

(f) Represents gain on remeasurement of a previously held equity investment in Uvet GBT (see note 3 - Business Acquisitions to our consolidated financial statements included elsewhere in this Annual Report).

(g) Adjusted Operating Expenses excludes (i) long-term incentive plan expense of $1 million and $8 million for the years ended December 31, 2025 and 2024, respectively, and (ii) legal and professional services costs of $2 million and $5 million for the years ended December 31, 2025 and 2024, respectively.

Adjusted EBITDA additionally excludes (i) unrealized foreign exchange losses (gains) of $19 million and $(22) million for the years ended December 31, 2025 and 2024, respectively, and (ii) non-service component of our net periodic pension cost related to our defined benefit pension plans of $10 million and $5 million for the years ended December 31, 2025 and 2024, respectively.

For a discussion of Free Cash Flow and Net Debt, see “ Liquidity and Capital Resources — Free Cash Flow ” and “ Liquidity and Capital Resources — Net Debt .”

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For the year ended December 31, 2025, our total revenue increased by $295 million, or 12%, due to an increase in both Travel Revenue and Product and Professional Services Revenue.

The increase in total revenue was driven by 5% Transaction Growth, offset by a modest decline of 17 bps in yield to 8% due to mix of non-TTV driven revenue and higher digital transactions.

Yield is calculated as total revenue divided by TTV for the same period.

Travel Revenue increased by $105 million, or 6%, primarily due to 5% incre ase in Transaction Growth and an 8% increase in TTV.

Product and Professional Services Revenue increased $28 million, or 6%, due to $20 million increase in management fees and $8 million from increased consulting and other professional services revenue.

The increase in total revenue was driven by $209

million of incremental revenue resulting from the CWT acquisition and an $86 million from Transaction Growth and

increase in TTV.

Increase in revenue includes $34 million of favorable foreign exchange impact.

Travel Revenue increased by $222 million, or 12%, due to $151 million of incremental revenue resulting from the CWT acquisition and $71 million due to Transaction Growth and increase in TTV.

Increase in Travel Revenue includes $23 million of favorable foreign exchange impact.

Product and Professional Services Revenue increased $73 million, or 15%, due to $58 million of incremental

revenue resulting from the CWT acquisition, a $10 million increase in other professional services revenue and a $5 million increase in management fees.

The increase in Product and Professional Services Revenue includes $11 million of favorable foreign exchange impact.

Cost of Revenue (Excluding Depreciation and Amortization)

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Cost of revenue (excluding depreciation and amortization) $ 1,085 $ 967 $ 118 12 %

For the year ended December 31, 2024, cost of revenue (excluding depreciation and amortization) increased by $6 million, or 1%, primarily due to (i) additional traveler care costs of $59 million to manage the increase in transaction volume and (ii) a merit increase of $25 million in salaries and benefits, offset by (iii) $81 million reduction in expenses primarily due to cost savings initiatives.

For the year ended December 31, 2025, cost of revenue (excluding depreciation and amortization) increased by $118 million, or 12%, primarily due to (i) $120 million of incremental expenses resulting from the CWT acquisition and (ii) $50 million related to higher employee headcount and merit increases, partially offset by (iii) $56 million productivity improvements primarily driven by reduction in expenses due to cost savings initiatives.

Increase in cost of revenue expenses (excluding depreciation and amortization) includes $22 million of unfavorable foreign exchange impact.

Sales and Marketing

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Sales and marketing $ 442 $ 400 $ 42 10 %

For the year ended December 31, 2024, sales and marketing expenses increased by $6 million, or 2%, due to (i) higher employee costs of $10 million to support additional transaction volume, (ii) $8 million increased costs to support

growth plans in hotel acceleration and small and medium enterprise customer base, offset by (iii) a reduction of $12 million due to cost savings initiatives.

For the year ended December 31, 2025, sales and marketing expenses increased by $42 million, or 10%, primarily due to (i) $22 million of incremental expenses resulting from the CWT acquisition, (ii) a $19 million increase related to higher employee headcount and merit increases, (iii) an $11 million increase in costs to manage volume and support growth plans in hotel acceleration and small and medium enterprise client base, (iv) a $5 million increase mainly due to professional services vendor spend, partially offset by (v) a $19 million reduction in expenses primarily due to cost savings initiatives.

Increase in sales and marketing expenses includes $7 million of unfavorable foreign exchange impact.

Technology and Content

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Technology and Content $ 527 $ 442 $ 85 19 %

For the year ended December 31, 2024, technology and content increased by $29 million, or 7%, primarily due to (i) $13 million increase mainly to support growth plans in hotel acceleration and small and medium enterprise customer base, (ii) $12 million increase due to additional employee headcount, incentives and merit increases and (iii) $7 million increase in data processing fees.

For the year ended December 31, 2025, technology and content increased by $85 million, or 19%, primarily due to (i) a $44 million of incremental expenses resulting from the CWT acquisition, (ii) a $27 million increase related to higher employee headcount and merit increases and (iii) a $22 million increase to support growth plans in hotel acceleration and small and medium enterprise client base, partially offset by (iv) an $11 million reduction in expenses due to cost savings initiatives.

Increase in technology and content expenses includes $10 million of unfavorable foreign exchange impact.

General and Administrative

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General and administrative $ 290 $ 308 $ (18) (6) %

For the year ended December 31, 2024, general and administrative expenses increased by $14 million, or 4%, due to (i) increased mergers and acquisitions costs of $43 million for the pending acquisition of CWT, offset by (ii) $15 million decrease resulting from cost saving initiatives, (iii) an $11 million reduction related to lower integration expenses and (iv) a $3 million reduction of prior year costs incurred resulting from accelerated amortization of operating lease ROU assets.

For the year ended December 31, 2025, general and administrative expenses decreased by $18 million, or 6%, due to (i) a $17 million decrease resulting from cost saving initiatives, (ii) a $15 million decrease in employee incentives , (iii) a $10 million decrease in mergers and acquisitions costs, and (iv) a $4 million decrease in integration costs, partially offset by (v) $24 million of incremental expenses resulting from the CWT acquisition and (vi) $4 million increase in head office and other corporate costs.

Restructuring and Other Exit Charges

Restructuring and other exit charges primarily comprise of employee severance due to reduction in workforce to improve operational efficiencies and accrual of certain contract termination costs related to leased facilities abandonment.

For the year ended December 31, 2024, restructuring charges decreased by $29 million due to higher severance costs incurred in 2023 resulting from changes to our internal operating model and certain exit activities.

For the year ended December 31, 2025, restructuring charges of $52 million primarily related to restructuring actions initiated by us following a review of the combined business after completion of the CWT acquisition and other employee severance costs due to reduction in workforce to improve operational efficiencies (see note 12 - Restructuring, Exit and Related Charges to our consolidated financial statements included elsewhere in this Annual Report).

Depreciation and Amortization

For the year ended December 31, 2024, depreciation and amortization decreased by $16 million, or 8%, due to (i) certain intangible assets that were fully amortized during 2024 resulting in a decrease of $19 million in depreciation and amortization and (ii) $5 million decrease in amortization related to leasehold improvements, offset by (iii) an increase in software amortization of $8 million due to higher capitalization.

For the year ended December 31, 2025, depreciation and amortization increased by $14 million, or 8%, primarily due to incremental depreciation resulting from the CWT acquisition, increase in amortization of capitalized software and accelerated amortization of certain leasehold improvements, partially offset by certain intangible assets that were fully amortized during 2024.

Interest Expense

For the year ended December 31, 2025, interest expense decreased by $20 million, or 17%.

The fixed rate margins were lower during the year ended December 31, 2024 compared to the year ended December 31, 2023 due to (i) improved leverage ratios under the Original Credit Agreement based on which margins were set and (ii) refinancing of term loans in July 2024 with lower fixed rate margins.

The changes in variable interest rates did not have material impact due to interest rate swaps being in place.

The fixed rate margins were generally lower during the year ended December 31, 2025 compared to the year ended December 31, 2024 due to refinancing of term loans in July 2024.

Subsequently, in February 2025, we repriced our term loans that lowered the fixed rate margins further (see note 13 - Long-term Debt ).

The reduction in variable interest rates further reduced our interest expense in respect of a portion of debt not covered by interest rate swaps hedges.

Loss on Early Extinguishment of Debt

During the year ended December 31, 2024 , we refinanced our debt and repaid the entire principal amount of term loans outstanding under our Original Credit Agreement, including early prepayment penalty, and recognized a loss on early extinguishment of debt of $38 million.

During the year ended December 31, 2025 , we repriced our term loans in January 2025, that resulted in a loss on early extinguishment of debt of $2 million due to certain lenders leaving the consortium.

In 2024, we refinanced our debt and repaid the entire principal amount of term loans outstanding under our then existing credit agreement, including early prepayment penalty, and recognized a loss on early extinguishment of debt of $38 million.

Fair Value Movements on Earnout Derivative Liabilities

For the year ended December 31, 2024, the fair value of our derivative liabilities related to our earnout shares resulted in a charge of $56 million to our consolidated statement of operations compared to a credit of $13 million during the year ended December 31, 2023.

The increase in fair value of earnout derivative liability was mainly driven by the increase in our stock price as of December 31, 2024.

Other Income (Loss), net

For the year ended December 31, 2024, other income (loss), net, increased by $27 million due to higher foreign exchange gains.

(Provision for) Benefit from Income Taxes

For the year ended December 31, 2024 and 2023 , we had an income tax (expense) benefit of $(66) million and $9 million, respectively, and our effective tax rate was 92.96% and 6.32%, respectively.

Our effective tax rate for the year ended December 31, 2024 is significantly higher than the U.S.

federal statutory tax rate of 21% primarily due to non-deductible expenses.

For the year ended December 31, 2025, the fair value of our derivative liabilities related to our earnout shares resulted in a credit of $96 million to our consolidated statement of operations compared to a charge of $56 million during the year ended December 31, 2024 .

The decrease in fair value of earnout derivative liability was mainly driven by the decrease in our stock price and the lower remaining expected term of the earnout shares as of December 31, 2025.

Gain on Remeasurement of Previously Held Equity Interest

On December 29, 2025, we gained control over Uvet GBT, by obtaining majority representation on its board of directors.

Prior to obtaining a controlling interest, we accounted for our 35 % ownership in Uvet GBT as an equity method investment.

This transaction was accounted for as a "step acquisition" and, as such, we remeasured our pre-existing equity interest in Uvet GBT immediately prior to the completion of the acquisition to its estimated fair value resulting in a gain of $39 million in our consolidated statements of operation.

Other (Loss) Income, net

For the year ended December 31, 2025, we had other loss of $29 million compared to other income of $17 million during the year ended December 31, 2024.

The unfavorable movement of $46 million was mainly driven by foreign exchange losses of $19 million during 2025 compared to foreign exchange gains of $22 million during 2024.

Provision for Income Taxes

For the year ended December 31, 2025 and 2024 , we had an income tax expense of $40 million and $66 million, respectively, and our effective tax rate was 27.41% and 92.96%, respectively.

Our effective tax rate for the year ended

December 31, 2025 is higher than the U.S.

federal statutory tax rate of 21% primarily due to non-deductible expenses offset by non-taxable income (gains arising due to the fair value movement on the earnout shares and the gain on remeasurement of the Uvet GBT investment, as discussed above) and a net reduction in valuation allowances.

Liquidity and Capital Resources

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Over the long-term, we manage our cash and capital structure with an intention to maintain our financial condition and flexibility for future strategic initiatives.

Our principal sources of liquidity are typically cash flows generated from operations, cash available under the credit facilities under the A&R Credit Agreement as well as cash and cash equivalent balances on hand.

Our principal sources of liquidity are typically cash flows generated from operations, cash available under the credit facilities as well as cash and cash equivalent balances on hand.

As of December 31, 2025 and December 31, 2024, our cash and cash equivalent balances were $434 million and $536 million, respectively.

During the years ended December 31, 2025 and 2024, our cash flows from operating activities were $233 million and $272 million, respectively, and our Free Cash Flow was $104 million and $165 million, respectively (See “ — Free Cash Flow ” for additional information about this non-GAAP measure and a reconciliation to the most directly comparable financial measure calculated in accordance with GAAP).

Further, as of December 31, 2024, our $360 million of Revolving Credit Facility remained undrawn and fully available to be drawn down.

We believe our liquidity is important given the risks to future financial performance due to the uncertainties of a potential economic slowdown on account of prevailing macro-economic conditions.

We continue to take measures to improve our liquidity through our cost savings programs (voluntary and involuntary redundancies, process improvements, location optimization, etc.), and entered into several financial transactions, including debt financing / refinancing / repricing transactions.

For example, in July 2024, we refinanced our then existing term loan facility under the Original Credit Agreement and extended the maturity of term loans until July 2031 (see note 13 - Long-term Debt to our consolidated financial statement included elsewhere in this Annual Report).In January 2025, we entered in an amendment to our A&R Credit Agreement to reduce our interest rate margins by 50 bps (see note 25 — Subsequent Events to out consolidated financial statements included elsewhere in this Annual Report).

Further, in February 2025, we received an upgrade to our credit ratings which reduced the commitment fees payable on our Revolving Credit Facility (see Net Debt - Debt Ratings below).

As of December 31, 2025, our $360 million of Revolving Credit Facility under the A&R Credit Agreement remained fully undrawn;

however, our full utilization of the $360 million of available commitments thereunder may be effectively limited with the leverage-based financial covenant requirements.

Cash balances in certain foreign countries may have repatriation restrictions or limitations that could impact liquidity and cash transfers between entities.

As of December 31, 2025 , $337 million of our cash and cash equivalents is located outside the U.S., primarily used for local business operations, with some jurisdictions having limitations on cash

Despite these limitations or restrictions, we do not expect them to materially affect overall liquidity or financial operations.

We believe our liquidity is important given our limited ability to predict future financial performance due to the uncertainties of a potential economic slowdown on account of prevailing macroeconomic conditions.

We continue to take measures to improve our liquidity.

Such measures include our cost savings initiatives that includes productivity-related

actions (process improvements, location optimizations, voluntary and involuntary redundancies, etc.) and vendor cost

Cost savings include benefits for actions taken in the prior years and in 2025.

Further, from time to time, we have entered into several financial transactions, including debt financing / refinancing / repricing transactions to reduce costs and improve liquidity.

In February 2025, we entered in an amendment to our A&R Credit Agreement to reduce our interest rate margins by 50 bps.

Similarly, in January 2026, we entered into second amendment to our credit facility to reduce our interest margins by 50 bps and additionally borrowed a principal amount of $100 million (see note 13 - Long-term Deb t and note 25 - Subsequent Events to our consolidated financial statements included elsewhere in this Annual Report).

Further, in February 2025, we received an upgrade to our credit ratings which reduced the commitment fees by 0.125% payable on our Revolving Credit Facility (see Net Debt - Debt Ratings below).

We continue to explore other capital market transactions, process rationalizations and cost reduction measures to improve our liquidity position.

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In addition, from time to time, we may evaluate acquisitions and other strategic opportunities or undertake transactions to increase shareholder value.

If we elect to pursue any such investments, we may fund them with internally generated funds, bank financing, the issuance

of other debt or equity or a combination thereof.

If we elect to pursue any such investments, we may fund them with internally generated funds, bank financing, the issuance of other debt or equity or a combination thereof.

There is no assurance that such funding would be available to us on acceptable terms or at all.

Our full utilization of the Revolving Credit Facility, under the A&R Credit Agreement entered into in July 2024, may be effectively limited with the leverage-based financial covenant requirements.

The following table summarizes our cash flows for the years indicated:

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Net cash used in investing activities (206) (102) (104) (101) %

Net cash (used in) from financing activities (85) 120 (205) n/m

Effect of exchange rate changes on cash, cash equivalents and restricted cash (13) 10 (23) n/m

Net increase in cash, cash equivalents and restricted cash $ 72 $ 173 $ (101) (59) %

_____________________________________________

n/m — not meaningful

Net cash used in financing activities (128) (85) (43) (51)%

Effect of exchange rate changes on cash, cash equivalents and restricted cash 19 (13) 32 (244) %

Net (decrease) increase in cash, cash equivalents and restricted cash $ (82) $ 72 $ (154) (215) %

Cash Flows for the Year Ended December 31, 2025 Compared to the Year Ended December 31, 2024

As of December 31, 2024, we had $561 million of cash, cash equivalents and restricted cash, an increase of $72 million compared to December 31, 2023.

As of December 31, 2025, we had $479 million of cash, cash equivalents and restricted cash, a decrease of $82 million compared to December 31, 2024.

The following discussion summarizes changes to our cash from operating, investing and financing activities for the year ended December 31, 2025 compared to the year ended December 31, 2024.

Operating Activities

For the year ended December 31, 2024, net cash from operating activities was $272 million compared to $162 million of cash from operating activities for the year ended December 31, 2023.

The improvement in cash flows from operating activities of $110 million was primarily due to $81 million increase in operating income and working capital movements before considering non-cash charges or credits and $43 million of lower cash interest payments partially offset by $12 million of higher cash income taxes.

For the year ended December 31, 2025, net cash from operating activities was $233 million compared to $272 million of net cash from operating activities for the year ended December 31, 2024.

The decrease in cash flows from operating activities of $39 million was due to (i) $74 million cash outflows resulting from movement in working capital including increase in net income tax payments and cash payments related to merger and acquisition that were mitigated by an increase in operating income before considering non-cash charges / credits, offset by (ii) $35 million of increased cash inflows resulting from termination of interest rate swap contracts.

Investing Activities

During the year ended December 31, 2024 cash used in investing activities decreased by $17 million primarily due to (i) decrease in purchase of property and equipment of $6 million and (ii) $10 million resulting from proceeds received in 2024 for a loan given to an equity affiliate in 2023.

During the year ended December 31, 2024, the increase in capitalized software was more than offset by decrease in capital expenditure related to Egencia integration.

During the year ended December 31, 2025 cash used in investing activities increased by $104 million primarily due to (i) $138 million cash paid as part of purchase consideration, net of cash acquired, for the acquisition of CWT and (ii) a $22 million increase in cash outflows related to purchase of property and equipment, offset by (iii) $34 million cash received on acquisition of Uvet GBT (see note 3 - Business Acquisitions to our consolidated financial statements included elsewhere in this Annual Report) and (iv) $27 million of proceeds received on maturity of foreign exchange forward contract derivatives that economically hedged certain foreign currency intercompany balances.

Financing Activities

During the year ended December 31, 2024, net cash used in financing activities of $85 million was primarily due to:

(i) $1,372 million of repayment of principal amount of term loans under the Original Credit Agreement upon

refinancing of debt in July 2024, (ii) $55 million of shares repurchased, (iii) $51 million related to debt refinancing

costs and premium for early repayment of term loans, and (iv) $28 million cash paid for taxes withheld upon

vesting of equity awards, offset by (v) $1,397 million of proceeds from borrowings under the A&R Credit Agreement, net

of discount, upon debt refinancing in July 2024 and (vi) $29 million cash received from contributions for ESPP and

exercise of stock options.

During the year ended December 31, 2023, net cash from financing activities of $120 million was primarily due to:

(i) $131 million of proceeds received from borrowings under the senior secured tranche B-4 term loan facilities, net of discount, and (ii) $7 million received from exercise of stock options and contributions for ESPP, partially offset by (iii) $5 million repayment of principal amount of senior secured term loans and finance leases, and (iv) $14 million cash paid for taxes withheld upon vesting / exercise of equity awards.

During the year ended December 31, 2025, net cash used in financing activities increased by $43 million primarily due to (i) a $39 million increase in net outflow of principal amount of term loans under the A&R Credit Agreement ($25 million of net inflow resulting from refinancing of term loans during the year ended December 31, 2024, compared to $14 million of repayment of term loans during the year ended December 31, 2025), (ii) a $21 million decrease in cash received from contributions for ESPP (as defined herein) and exercise of stock options, (iii) a $18 million increase in cash paid for repurchase of our common shares, and (iv) a $15 million increase in cash paid for taxes withheld upon vesting of equity awards, partially offset by (v) a $51 million decrease in cash paid related to debt refinancing costs and make-whole premium for early repayment of term loans.

Free Cash Flow

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We use this measure to conduct and evaluate our operating liquidity.

We believe it typically presents an alternate measure of cash flows since purchases of property and equipment are a necessary component of our ongoing operations and it provides useful information regarding how cash provided by operating activities compares to the property and equipment investments required to maintain and grow our platform.

We believe it typically presents an alternate measure of cash flows since purchases of property and equipment are a

necessary component of our ongoing operations and it provides useful information regarding how cash provided by operating activities compares to the property and equipment investments required to maintain and grow our platform.

We believe Free Cash Flow provides investors with an understanding of how assets are performing and measures management’s effectiveness in managing cash.

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Free Cash Flow $ 104 $ 165 $ (61) (37) %

During the year ended December 31, 2024, our Free Cash Flow improvement of $116 million was due to a $110 million increase in net cash from operating activities and a decrease of $6 million of cash outflows related to purchases of property and equipment as discussed above.

During the year ended December 31, 2025, our Free Cash Flow decreased by $61 million due to a $39 million decrease in net cash from operating activities and an increase of $22 million of cash outflows related to purchases of property and equipment as discussed above.

We define Net Debt as total debt outstanding consisting of current and non-current portion of long-term debt, net of unamortized debt discount and unamortized debt issuance costs, minus cash and cash equivalents.

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Management uses Net Debt to review our overall liquidity, financial flexibility, capital structure and leverage.

believe that certain debt rating agencies, creditors and credit analysts monitor our Net Debt as part of their assessment of our business.

Further, we believe that certain debt rating agencies, creditors and credit analysts monitor our Net Debt as part of their assessment of our business.

The following table summarizes our Net Debt position as of December 31, 2025 and December 31, 2024:

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Net Debt $ 984 $ 848

During the year ended December 31, 2024, our Net Debt decreased by $38 million due to $60 million increase in cash and cash equivalents balance offset by $22 million of net increase in total debt, net of unamortized debt discount and debt issuance costs, primarily resulting from refinanced term loans as discussed below.

During the year ended December 31, 2025, our Net Debt increased by $136 million due to $102 million decrease in cash and cash equivalents balance and $34 million of net increase in total debt, net of unamortized debt discount and debt issuance costs.

On July 26, 2024, we amended and restated our senior secured credit facility, and borrowed an aggregate principal amount of $1,400 million of term loans.

The proceeds therefrom were used, in part, to repay in full the loans and other outstanding obligations (including premium, related fees and expenses) under the Original Credit Agreement (see note 13 - Long-term Debt to our consolidated financial statements included elsewhere in this Annual Report).

Further, in January 2025, we amended the A&R Credit Agreement to reduce the interest rate margin on Initial Term Loans from 3.00% per annum to 2.50% per annum.(see note 25 - Subsequent Events to our consolidated financial statements included elsewhere in this Annual Report).

The reduction in margin is expected to decrease our annual cash interest payment by $7 million.

The proceeds therefrom were used, in part, to repay in full the loans and other outstanding obligations (including premium, related fees and expenses) under the Original Credit Agreement.

Further, in February 2025, we amended the A&R Credit Agreement to reduce the interest rate margin on term loans from 3.00% per

annum to 2.50% per annum.(see note 13 - Long-term Debt to our consolidated financial statements included elsewhere in this Annual Report).

In January 2026, we entered into a further amendment to the A&R Credit Agreement, whereby we reduced the margin on the Term B-1 Loans by 50 basis points and borrowed an additional principal amount of term loans of $100 million (see note 25 - Subsequent Events to our consolidated financial statement included elsewhere in this Annual Report).

Debt Covenants

Our A&R Credit Agreement contains customary restrictive financial and operating covenants (see note 13 - Long-term Debt to our consolidated financial statements included elsewhere in this Annual Report).

The A&R Agreement contains customary restrictive financial and operating covenants (see note 13 - Long-term Debt to our consolidated financial statements included elsewhere in this Annual Report).

As of December 31, 2025, we were in compliance with all applicable covenants under the A&R Credit Agreement.

In February 2025, our borrowings under the A&R Credit Agreement was upgraded to "BB-" from “B+” by Standard & Poor’s Financial Services LLC ("S&P") with Stable outlook.

Earlier in 2024, we had also received a "B2" rating from Moody's Corporation ("Moody's") and "BBB-" rating from Fitch Ratings Inc.

In March 2025, Moody's Corporation also upgraded our senior secured credit facilities to "B1" from "B2" and in June 2025, Fitch Ratings Inc.

revised our rating outlook from Stable to Positive, while maintaining a "BBB-" rating.

Upon the upgrade in our credit rating in February 2025, our fee for Revolving Credit Facility, calculated based on the average daily commitments under the Revolving Credit Facility and payable quarterly in arrears, reduced to 0.25% per annum from 0.375% per annum.

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Share Repurchase Program

In October 2024, our Board of Directors authorized our management to repurchase shares of the Company’s Class A common stock through December 31, 2027 in an amount not to exceed $300 million.

Under the share repurchase program, we are authorized to repurchase, on a discretionary basis and from time-to-time, outstanding shares of our Class A common stock by means of open market transactions, privately negotiated transactions and/or by other means deemed appropriate or advisable by our management.

The timing, manner, price and amount of any repurchases will be subject to our discretion and depend on a variety of factors, including the market price of our Class A common stock, general market and economic conditions, regulatory requirements and other business considerations.

The share repurchase program may be suspended, modified or discontinued at any time, and we have no obligation to repurchase any amount of our Class A common stock under the program.

As of December 31, 2024, no shares have been repurchased under the share repurchase program and $300 million remains available to be utilized under the share repurchase program.

The share repurchase transaction that we entered into

in August 2024 (see note 19 - Shareholders' Equity to our consolidated financial statements included elsewhere in this Annual Report), was not part of this share repurchase program, and was a separately negotiated transaction with a shareholder.

During the year ended December 31, 2025 , we repurchased 9 million shares for $73 million under the share

repurchase program that was authorized by our Board of Directors in October 2024 and pursuant to which management

was authorized to repurchase, in an amount not to exceed $300 million, shares of the Company's Class A common stock

through December 31, 2027.

The shares repurchased are held as treasury shares.

As of December 31, 2025 , we had $227

million that remains available to be utilized under the share repurchase program (see note 19 - Shareholders' Equity to our consolidated financial statements included elsewhere in this Annual Report.)

On February 17, 2026, we announced that our Board of Directors authorized an increase of the amount available for the share repurchase program from $300 million to $600 million.

Contractual Obligations and Commitments

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Our debt obligation primarily includes all interest and principal of borrowings under our A&R Credit Agreement.

Under certain circumstances, each year, starting for the year ending December 31, 2025, a portion of the Initial Term Loans outstanding under the A&R Credit Agreement is required to be prepaid with a percentage of annual excess cash flow, if any, calculated in a manner set forth in the A&R Credit Agreement.

Under certain circumstances, we will also be required to prepay, or make an offer to prepay, the Initial Term Loans outstanding under the A&R Credit Agreement with the proceeds received from certain other events, subject to certain exceptions and limitations set forth in the A&R Credit Agreement.

Under certain circumstances, each year, a portion of our term loans outstanding under the A&R Credit Agreement is required to be prepaid with a percentage of annual excess cash flow, if any, calculated in a manner set forth in the A&R Credit Agreement.

Under certain circumstances, we will also be required to prepay, or make an offer to prepay, the term loans outstanding under the A&R Credit Agreement with the proceeds received from certain other events, subject to certain exceptions and limitations set forth in the A&R Credit Agreement.

For the year ended December 31, 2025, we have determined that no such mandatory prepayments, including any annual excess cash flow payments, are required.

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Interest on the term loans is based on SOFR, plus applicable margin, and includes the effect of interest rate and cross currency swaps.

For purposes of this disclosure, we have used SOFR and margin rates as of December 31, 2024 for all future periods and have excluded the impact of changes in interest rate swap contracts entered into in January 2025 and debt repricing transaction of February 2025 (s ee note 13 — Long-term Debt and note 25 - Subsequent Events to our consolidated financial statements included elsewhere in this Annual Report).

For purposes of this disclosure, we have used SOFR and margin rates as of December 31, 2025 for all future periods and have excluded the impact of debt repricing and additional borrowing transaction of January 2026 (s ee note 25 - Subsequent Events to our consolidated financial statements included elsewhere in this Annual Report).

Lease Obligations

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As of December 31, 2025, our operating leases had fixed lease payment obligations, including imputed interest, of $108 million, with $32 million payable within 12 months.

Our finance lease obligations as of December 31, 2024 were not material.

See note 9 – Leases to our consolidated financial statements included elsewhere in this Annual Report.

Our finance lease obligations as of December 31, 2025 were $14 million.

See note 9 – Leases and note 13 - Long-term Debt to our consolidated financial statements included elsewhere in this Annual Report.

Purchase Obligations

We have certain purchase obligations related to information technology (“IT”) agreements and certain other services.

We have certain purchase obligations related to IT agreements and certain other services.

Agreements with IT providers include cloud-based services, hosting and licensing contracts.

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There is generally a time-lag by when the airlines provide full details for the actual flown incremental bookings.

Therefore, we estimate such incentive revenues using internal and external data detailing completed and estimated completed airline travel and the price thresholds applicable to the volume for the period, as the consideration is variable and determined by meeting volume targets, requiring significant management judgement.

We allocate the variable consideration to the flown bookings during the incentive period, which is generally determined by the airlines to be a single fiscal quarter, and recognize that amount as the related performance obligations are satisfied, to the extent that it is probable that a subsequent change in the estimate would not result in a significant revenue reversal.

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The expected long-term rate of return is used in the calculation of net periodic pension cost (benefit).

The use of the expected long-term rate of return on plan assets may result in recognized returns that are greater or less than the actual returns on those plan assets in any given year.

The use of the expected long-term rate of return on plan assets may result in

recognized returns that are greater or less than the actual returns on those plan assets in any given year.

The expected long-term rate of return for plan assets has been determined using historical returns for the different asset classes held by our trusts and its asset allocation, as well as inputs from internal and external sources regarding expected capital market return, inflation and other variables.

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Actual returns on plan assets for 2025, 2024 and 2023 were 3.4%, (5.3)% and (0.4)%, respectively, compared to the expected rate of return assumptions of 5.6%, 5.1% and 4.9%, respectively.

The sensitivity to a 100 basis point increase or decrease in the expected rate of return on plan assets assumption related to our pre-tax employee benefit expense for 2024 would be to decrease or increase the 2024 pre-tax expense by $4 million in each case.

The sensitivity to a 100 basis point increase or decrease in the expected rate of return on plan assets assumption related to our pre-tax employee benefit expense would be to decrease or increase the pre-tax expense by $5 million in each case.

While we believe these assumptions are appropriate, significant differences in actual experience or significant changes in these assumptions may materially affect our defined benefit pension obligations and our future expense.

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Inherent in such pricing models are assumptions related to expected stock-price volatility, expected life, risk-free interest rate and dividend yield.

We estimated the volatility of the earnout shares based on weighted average of our own

share price volatility and implied volatility from historical volatility of select peer companies’ common stock that matched the expected remaining life of the earnout shares.

We estimated the volatility of the earnout shares based on weighted average of our own share price volatility.

The risk-free interest rate was based on the U.S.

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The expected life of the earnout shares was assumed to be equivalent to their remaining contractual term.

We anticipated the dividend rate will remain at zero.

We anticipate the dividend rate will remain at zero.

We recognize deferred tax assets and liabilities based on the temporary differences between the financial statement carrying amounts and the tax bases of assets and liabilities.

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therefore, the Company’s assessments can involve both a series of complex judgments about future events and reliance on significant estimates and assumptions.

While the Company believes the estimates and assumptions supporting the assessments are reasonable, the final determination of tax audits and any other related litigation could be materially different from that which is reflected in historical income tax provisions and recorded assets and liabilities.

While the Company believes the estimates and assumptions supporting

the assessments are reasonable, the final determination of tax audits and any other related litigation could be materially different from that which is reflected in historical income tax provisions and recorded assets and liabilities.

Business Combination

We account for business combinations using the purchase method of accounting, which requires that once control is obtained, all the assets acquired and liabilities assumed are recorded at their respective fair values, except for certain exceptions, at the date of acquisition.

The determination of the acquisition date fair values of identifiable assets acquired and liabilities assumed requires estimates and the use of valuation techniques when fair value is not readily available and requires a significant amount of management judgment.

We typically obtain independent third-party valuation to assist us in determining fair values, including assistance in determining discount rates, internal rate of return, royalty rates, market multiples, comparable market values, etc.

Items involving significant assumptions, estimates and judgments include the following:

• Cash flow forecasts related to business acquired;

• Fair value of contingent consideration;

• Identifying intangible assets and their fair valuation, including valuation methodology, estimates of future revenues and costs, profit allocation rates attributable to the acquired technology and discount rates;

• Estimates of market multiples for applying guideline public company method;

• Deferred taxes, including projections of future taxable income and tax rates.

We estimate the fair value of assets acquired and liabilities assumed based upon assumptions we believe to be reasonable, but which are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates.

Estimates associated with the accounting for acquisitions may change as additional information becomes available regarding the assets acquired and liabilities assumed.

Due to the subjectivity and reliance on forward-looking inputs, these acquisition-related estimates qualify as critical accounting estimates.

For the valuation of intangible assets acquired in a business combination, we typically use an income approach.

We used the multi-period excess earnings method to determine the estimated acquisition date fair values of the customer relationships intangible assets.

The significant assumptions used to estimate the fair values of customer relationships included forecasted revenues, expected customer attrition rates, and the discount rate applied.

Although we believe our estimates of acquisition date fair values are reasonable, actual financial results could differ from those estimates due to the inherent uncertainty involved in making such estimates.

Changes in assumptions concerning future financial results or other underlying assumptions could have a significant impact on the determination of the fair values of the customer relationships intangible assets acquired.

The fair values of software and trade names were determined by applying the relief from royalty method under the income approach.

The relief from royalty method applies a royalty rate to projected income to quantify the benefit of owning the intangible asset rather than paying a royalty for use of the asset.

The economic useful life for software was determined based on historical technology obsolescence patterns and prospective technological developments.

The estimated economic useful life of the trade names was determined based on the expected probability of continued use of the brand asset.

The fair value of the equity-method investee acquired in the CWT acquisition was determined based on guideline public company method which determines a private company's fair value by comparing it to similar, publicly traded companies and uses a market multiple to arrive at the fair value.

It involves selecting comparable companies, determining appropriate valuation multiple and applying market based adjustments which are all critical estimates to arrive at the fair value.

Recent Accounting Pronouncements

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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 7. Management’s Discussion and Analysis