Information Services Group Inc. 10-Q

ITEM 1. FINANCIAL STATEMENTS (UNAUDITED) ​ INFORMATION SERVICES GROUP, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (In thousands, except par value) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ September 30, ​ December 31, ​ ​ 2025 2024 ASSETS ​ ​ ​ ​ ​ ​ ​ Current assets ​ ​ ​ ​ ​ ​ ​ Cash and cash equivalents ​ $ 28,735 ​ $ 23,075 ​ Accounts receivable and contract assets, net of allowance of $ 1,705 and $ 5,047 , respectively ​ 59,893 ​ 58,822 ​ Prepaid expenses and other current assets ​ 5,598 ​ 9,384 ​ Total current assets ​ 94,226 ​ 91,281 ​ Restricted cash ​ 93 ​ 83 ​ Furniture, fixtures and equipment, net ​ 6,937 ​ 6,195 ​ Right-of-use lease assets ​ 11,406 ​ 5,437 ​ Goodwill ​ 89,335 ​ 87,293 ​ Intangible assets, net ​ 3,613 ​ 3,560 ​ Deferred tax assets ​ 5,406 ​ 6,997 ​ Other assets ​ 2,236 ​ 3,669 ​ Total assets ​ $ 213,252 ​ $ 204,515 ​ LIABILITIES AND STOCKHOLDERS’ EQUITY ​ ​ ​ ​ ​ ​ ​ Current liabilities ​ ​ ​ ​ ​ ​ ​ Accounts payable ​ $ 9,500 ​ $ 9,192 ​ Current maturities of long-term debt ​ 5 ​ ​ — ​ Contract liabilities ​ 10,741 ​ ​ 10,058 ​ Accrued expenses and other current liabilities ​ 22,266 ​ ​ 19,170 ​ Total current liabilities ​ 42,512 ​ ​ 38,420 ​ Long-term debt, net of current maturities ​ 59,202 ​ ​ 59,175 ​ Deferred tax liabilities ​ 1,414 ​ ​ 1,750 ​ Operating lease liabilities ​ 9,301 ​ ​ 3,416 ​ Other liabilities ​ 6,135 ​ ​ 5,468 ​ Total liabilities ​ 118,564 ​ ​ 108,229 ​ Commitments and contingencies (Note 8) ​ ​ ​ ​ ​ ​ ​ Stockholders’ equity ​ ​ ​ ​ ​ ​ ​ Preferred stock, $ 0.001 par value; 10,000 shares authorized; none issued ​ — ​ ​ — ​ Common stock, $ 0.001 par value; 100,000 shares authorized; 49,706 shares issued and 47,948 outstanding at September 30, 2025 and 49,658 shares issued and 48,542 outstanding at December 31, 2024 ​ 50 ​ ​ 50 ​ Additional paid-in capital ​ 204,079 ​ ​ 210,149 ​ Treasury stock ( 1,758 and 1,116 common shares, respectively, at cost) ​ ( 7,939 ) ​ ​ ( 3,996 ) ​ Accumulated other comprehensive loss ​ ( 8,365 ) ​ ​ ( 10,053 ) ​ Accumulated deficit ​ ( 93,137 ) ​ ​ ( 99,864 ) ​ Total stockholders’ equity ​ 94,688 ​ ​ 96,286 ​ Total liabilities and stockholders’ equity ​ $ 213,252 ​ $ 204,515 ​ The accompanying notes are an integral part of these condensed consolidated financial statements. 2 INFORMATION SERVICES GROUP, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (Unaudited) (In thousands, except per share data) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ Nine Months Ended ​ ​ September 30, ​ September 30, ​ 2025 2024 ​ 2025 2024 Revenues ​ $ 62,364 ​ $ 61,277 ​ $ 183,512 ​ $ 189,808 Operating expenses ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Direct costs and expenses for advisors ​ 36,032 ​ 36,530 ​ 105,550 ​ 116,484 Selling, general and administrative ​ 20,601 ​ 18,855 ​ 61,899 ​ 63,026 Depreciation and amortization ​ 1,143 ​ 1,598 ​ 3,413 ​ 4,724 Operating income ​ 4,588 ​ 4,294 ​ 12,650 ​ 5,574 Interest income ​ 23 ​ 222 ​ 115 ​ 701 Interest expense ​ ( 1,051 ) ​ ( 1,604 ) ​ ( 3,154 ) ​ ( 4,672 ) Gain on the sale of business ​ ​ 720 ​ ​ — ​ ​ 720 ​ ​ — Foreign currency transaction loss ​ ( 81 ) ​ ( 30 ) ​ ( 174 ) ​ ( 24 ) Income before taxes ​ 4,199 ​ 2,882 ​ 10,157 ​ 1,579 Income tax provision ​ 1,143 ​ 1,734 ​ 3,430 ​ 1,782 Net income (loss) ​ $ 3,056 ​ $ 1,148 ​ $ 6,727 ​ $ ( 203 ) Weighted average shares outstanding: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Basic ​ 48,132 ​ 48,940 ​ 48,258 ​ 48,743 Diluted ​ 50,437 ​ 50,158 ​ 50,272 ​ 48,743 Earnings (loss) per share: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Basic ​ $ 0.06 ​ $ 0.02 ​ $ 0.14 ​ $ ( 0.00 ) Diluted ​ $ 0.06 ​ $ 0.02 ​ $ 0.13 ​ $ ( 0.00 ) Comprehensive income (loss): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income (loss) ​ $ 3,056 ​ $ 1,148 ​ $ 6,727 ​ $ ( 203 ) Foreign currency translation gain, net of tax expense (benefit) of $ 60 , $( 82 ), $ 508 and $ 8 , respectively ​ 259 ​ 637 ​ 1,688 ​ 56 Comprehensive income (loss) ​ $ 3,315 ​ $ 1,785 ​ $ 8,415 ​ $ ( 147 ) ​ The accompanying notes are an integral part of these condensed consolidated financial statements. ​ 3 INFORMATION SERVICES GROUP, INC. CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Unaudited) (In thousands, except per share data) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Additional ​ ​ ​ ​ Other ​ ​ ​ ​ Total ​ ​ Common Stock ​ Paid-in ​ Treasury ​ Comprehensive ​ Accumulated ​ Stockholders’ ​ Shares Amount Capital Stock Loss Deficit Equity Balance June 30, 2025 ​ 49,658 ​ $ 50 ​ $ 204,543 ​ $ ( 5,677 ) ​ $ ( 8,624 ) ​ $ ( 96,193 ) ​ $ 94,099 Net income ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ 3,056 ​ ​ 3,056 Other comprehensive income ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ 259 ​ ​ — ​ ​ 259 Treasury shares repurchased ​ — ​ ​ — ​ ​ — ​ ​ ( 2,760 ) ​ ​ — ​ ​ — ​ ​ ( 2,760 ) Proceeds from issuance of employee stock purchase plan (ESPP) shares ​ — ​ ​ — ​ ​ 36 ​ ​ 127 ​ ​ — ​ ​ — ​ ​ 163 Issuance of treasury shares for restricted stock units ("RSUs") vested ​ — ​ ​ — ​ ​ ( 371 ) ​ ​ 371 ​ ​ — ​ ​ — ​ ​ — Issuance of shares for acquisition of Martino & Partners ​ 48 ​ ​ 0 ​ ​ 250 ​ ​ — ​ ​ — ​ ​ — ​ ​ 250 Accrued dividends on unvested shares ​ — ​ ​ — ​ ​ 226 ​ ​ — ​ ​ — ​ ​ — ​ ​ 226 Cash dividends paid to shareholders ($ 0.045 per share) ​ — ​ ​ — ​ ​ ( 2,361 ) ​ ​ — ​ ​ — ​ ​ — ​ ​ ( 2,361 ) Stock-based compensation ​ — ​ ​ — ​ ​ 1,756 ​ ​ — ​ ​ — ​ ​ — ​ ​ 1,756 Balance September 30, 2025 ​ 49,706 ​ $ 50 ​ $ 204,079 ​ $ ( 7,939 ) ​ $ ( 8,365 ) ​ $ ( 93,137 ) ​ $ 94,688 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Additional ​ ​ ​ ​ Other ​ ​ ​ ​ Total ​ ​ Common Stock ​ Paid-in ​ Treasury ​ Comprehensive ​ Accumulated ​ Stockholders’ ​ Shares Amount Capital Stock Loss Deficit Equity Balance December 31, 2024 ​ 49,658 ​ $ 50 ​ $ 210,149 ​ $ ( 3,996 ) ​ $ ( 10,053 ) ​ $ ( 99,864 ) ​ $ 96,286 Net income ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ 6,727 ​ ​ 6,727 Other comprehensive income ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ 1,688 ​ ​ — ​ ​ 1,688 Treasury shares repurchased ​ — ​ ​ — ​ ​ — ​ ​ ( 10,074 ) ​ ​ — ​ ​ — ​ ​ ( 10,074 ) Proceeds from issuance of ESPP shares ​ — ​ ​ — ​ ​ 24 ​ ​ 449 ​ ​ — ​ ​ — ​ ​ 473 Issuance of treasury shares for restricted stock units ("RSUs") vested ​ — ​ ​ — ​ ​ ( 5,682 ) ​ ​ 5,682 ​ ​ — ​ ​ — ​ ​ — Issuance of shares for acquisition of Martino & Partners ​ 48 ​ ​ 0 ​ ​ 250 ​ ​ — ​ ​ — ​ ​ — ​ ​ 250 Accrued dividends on unvested shares ​ — ​ ​ — ​ ​ 127 ​ ​ — ​ ​ — ​ ​ — ​ ​ 127 Cash dividends paid to shareholders ($ 0.135 per share) ​ — ​ ​ — ​ ​ ( 6,969 ) ​ ​ — ​ ​ — ​ ​ — ​ ​ ( 6,969 ) Stock-based compensation ​ — ​ ​ — ​ ​ 6,180 ​ ​ — ​ ​ — ​ ​ — ​ ​ 6,180 Balance September 30, 2025 49,706 ​ $ 50 ​ $ 204,079 ​ $ ( 7,939 ) ​ $ ( 8,365 ) ​ $ ( 93,137 ) ​ $ 94,688 4 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Additional ​ ​ ​ ​ Other ​ ​ ​ ​ Total ​ ​ Common Stock ​ Paid-in ​ Treasury ​ Comprehensive ​ Accumulated ​ Stockholders’ ​ Shares Amount Capital Stock Loss Deficit Equity Balance June 30, 2024 ​ 49,658 ​ $ 50 ​ $ 211,854 ​ $ ( 2,753 ) ​ $ ( 9,570 ) ​ $ ( 104,054 ) ​ $ 95,527 Net income ​ — ​ ​ ​ ​ ​ — ​ ​ — ​ ​ — ​ ​ 1,148 ​ ​ 1,148 Other comprehensive income ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ 637 ​ ​ — ​ ​ 637 Treasury shares repurchased ​ — ​ ​ — ​ ​ — ​ ​ ( 800 ) ​ ​ — ​ ​ — ​ ​ ( 800 ) Proceeds from issuance of ESPP shares ​ — ​ ​ — ​ ​ ( 112 ) ​ ​ 303 ​ ​ — ​ ​ — ​ ​ 191 Issuance of treasury shares for RSUs vested ​ — ​ ​ — ​ ​ ( 1,129 ) ​ ​ 1,129 ​ ​ — ​ ​ — ​ ​ — Accrued dividends on unvested shares ​ — ​ ​ — ​ ​ ( 121 ) ​ ​ — ​ ​ — ​ ​ — ​ ​ ( 121 ) Dividend payable ​ — ​ ​ — ​ ​ ( 2,206 ) ​ ​ — ​ ​ — ​ ​ — ​ ​ ( 2,206 ) Cash dividends paid to shareholders ($ 0.045 per share) ​ — ​ ​ — ​ ​ ( 147 ) ​ ​ — ​ ​ — ​ ​ — ​ ​ ( 147 ) Stock-based compensation ​ — ​ ​ — ​ ​ 2,329 ​ ​ — ​ ​ — ​ ​ — ​ ​ 2,329 Balance September 30, 2024 49,658 ​ $ 50 ​ $ 210,468 ​ $ ( 2,121 ) ​ $ ( 8,933 ) ​ $ ( 102,906 ) ​ $ 96,558 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Additional ​ ​ ​ ​ Other ​ ​ ​ ​ Total ​ ​ Common Stock ​ Paid-in ​ Treasury ​ Comprehensive ​ Accumulated ​ Stockholders’ ​ Shares Amount Capital Stock Loss Deficit Equity Balance December 31, 2023 ​ 49,472 ​ $ 49 ​ $ 217,684 ​ $ ( 3,959 ) ​ $ ( 8,989 ) ​ $ ( 102,703 ) ​ $ 102,082 Net loss ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ ( 203 ) ​ ​ ( 203 ) Other comprehensive loss ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ 56 ​ ​ — ​ ​ 56 Treasury shares repurchased ​ — ​ ​ — ​ ​ — ​ ​ ( 5,306 ) ​ ​ — ​ ​ — ​ ​ ( 5,306 ) Proceeds from issuance of ESPP shares ​ — ​ ​ — ​ ​ ( 235 ) ​ ​ 873 ​ ​ — ​ ​ — ​ ​ 638 Issuance of treasury shares for RSUs vested ​ — ​ ​ — ​ ​ ( 6,271 ) ​ ​ 6,271 ​ ​ — ​ ​ — ​ ​ — Issuance of shares for Change 4 Growth ​ 186 ​ ​ 1 ​ ​ 700 ​ ​ — ​ ​ — ​ ​ — ​ ​ 701 Accrued dividends on unvested shares ​ — ​ ​ — ​ ​ ( 23 ) ​ ​ — ​ ​ — ​ ​ — ​ ​ ( 23 ) Dividend payable ​ — ​ ​ — ​ ​ ( 2,206 ) ​ ​ — ​ ​ — ​ ​ — ​ ​ ( 2,206 ) Cash dividends paid to shareholders ($ 0.09 per share) ​ — ​ ​ — ​ ​ ( 4,871 ) ​ ​ — ​ ​ — ​ ​ — ​ ​ ( 4,871 ) Stock-based compensation ​ — ​ ​ — ​ ​ 5,690 ​ ​ — ​ ​ — ​ ​ — ​ ​ 5,690 Balance September 30, 2024 49,658 ​ $ 50 ​ $ 210,468 ​ $ ( 2,121 ) ​ $ ( 8,933 ) ​ $ ( 102,906 ) ​ $ 96,558 ​ ​ The accompanying notes are an integral part of these condensed consolidated financial statements. ​ ​ ​ ​ ​ 5 INFORMATION SERVICES GROUP, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (In thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ Nine Months Ended ​ ​ September 30, ​ 2025 2024 Cash flows from operating activities ​ ​ ​ ​ ​ ​ Net income (loss) ​ $ 6,727 ​ $ ( 203 ) Adjustments to reconcile net income (loss) to net cash provided by operating activities: ​ ​ ​ ​ ​ ​ Depreciation expense ​ 2,446 ​ 2,494 Amortization of intangible assets ​ 967 ​ 2,230 Deferred tax expense (benefit) from stock issuances ​ ( 86 ) ​ ( 372 ) Amortization of deferred financing costs ​ 167 ​ 167 Stock-based compensation ​ 6,180 ​ 5,690 Change in fair value of contingent consideration ​ ​ 29 ​ ​ ( 2,323 ) Provisions for credit losses ​ ​ 129 ​ ​ 1,098 Gain on the sale on business ​ ​ ( 720 ) ​ ​ — Deferred tax (benefit) provision ​ 871 ​ ( 136 ) Changes in operating assets and liabilities: ​ ​ ​ ​ ​ ​ Accounts receivable and contract assets ​ ( 1,612 ) ​ 4,433 Prepaid expenses and other assets ​ ( 566 ) ​ ( 287 ) Accounts payable ​ ( 295 ) ​ ( 1,459 ) Contract liabilities ​ 683 ​ 545 Accrued expenses and other liabilities ​ 9,030 ​ 1,435 Net cash provided by operating activities ​ 23,950 ​ 13,312 Cash flows from investing activities ​ ​ ​ ​ ​ ​ Acquisition of Martino & Partners, net of cash acquired (Note 4) ​ ​ ( 1,636 ) ​ ​ — Purchase of furniture, fixtures and equipment ​ ( 3,269 ) ​ ( 2,303 ) Net working capital settlement from divestiture (Note 2) ​ ​ 720 ​ ​ — Net cash used in investing activities ​ ( 4,185 ) ​ ( 2,303 ) Cash flows from financing activities ​ ​ ​ ​ ​ ​ Proceeds from revolving facility (Note 10) ​ ​ 5,000 ​ ​ 10,000 Repayment of outstanding debt (Note 10) ​ ​ ( 5,000 ) ​ ​ ( 23,000 ) Additional proceeds from the sale of the Automation business (Note 2) ​ ​ 1,954 ​ ​ — Proceeds from issuance of employee stock purchase plan shares ​ 473 ​ ​ 637 Payments related to tax withholding for stock-based compensation ​ ( 2,784 ) ​ ( 1,921 ) Payment of contingent consideration ​ ​ ( 550 ) ​ ​ ( 1,657 ) Cash dividends paid to shareholders ​ ​ ( 6,969 ) ​ ​ ( 4,871 ) Treasury shares repurchased ​ ( 7,279 ) ​ ( 3,385 ) Net cash used in financing activities ​ ( 15,155 ) ​ ( 24,197 ) Effect of exchange rate changes on cash ​ 1,060 ​ 158 Net decrease in cash, cash equivalents, and restricted cash ​ 5,670 ​ ( 13,030 ) Cash, cash equivalents , and restricted cash , beginning of period ​ 23,158 ​ 22,809 Cash, cash equivalents , and restricted cash , end of period ​ $ 28,828 ​ $ 9,779 ​ ​ ​ ​ ​ ​ ​ Supplemental disclosures of cash flow information: ​ ​ ​ ​ ​ ​ Cash paid for: ​ ​ ​ ​ ​ ​ Interest ​ $ 2,933 ​ $ 4,416 Taxes, net of refunds ​ $ 904 ​ $ 2,515 ​ ​ ​ ​ ​ ​ ​ Non-cash investing and financing activities: ​ ​ ​ ​ ​ ​ Right-of-use assets obtained in exchange for lease liabilities (Note 11) ​ $ 7,160 ​ $ 229 Issuance of treasury stock for vested restricted stock units ​ $ 5,682 ​ $ 6,271 ​ ​ ​ ​ ​ ​ ​ ​ The accompanying notes are an integral part of these condensed consolidated financial statements . ​ ​ 6 ​ INFORMATION SERVICES GROUP, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (tabular amounts in thousands, except per share data) (unaudited) ​ ​ NOTE 1—DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS ​ Information Services Group, Inc. (the “Company” or “ISG”) is a global AI-centered technology research and advisory firm. A trusted partner to more than 900 clients, including 75 of the world’s top 100 enterprises, ISG is a long-time leader in technology and business services that is now at the forefront of leveraging AI to help organizations achieve operational excellence and faster growth. The firm, founded in 2006, is known for its proprietary market data, in-depth knowledge of provider ecosystems, and the expertise of its 1,300 professionals worldwide working together to help clients maximize the value of their technology investments . For more information, visit www.isg-one.com. The content on the Company’s website is available for informational purposes only. It should not be relied upon for investment purposes, nor is it incorporated by reference into this Form 10-Q or any other filings. The Company was founded with the strategic vision to become a high-growth, leading provider of information-based advisory services and continues to believe that its vision will be realized through the acquisition, integration and successful operation of market-leading brands within the data, analytics and advisory industry. ​ NOTE 2—BASIS OF PRESENTATION ​ The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial statements and pursuant to Form 10-Q and Article 10 of Regulation S-X. In the opinion of management, all adjustments (consisting of normal recurring accruals) have been made that are considered necessary for a fair statement of the financial position of the Company as of September 30, 2025, the results of operations for the three and nine months ended September 30, 2025 and 2024 and the cash flows for the nine months ended September 30, 2025 and 2024. The condensed consolidated balance sheet as of December 31, 2024 has been derived from the Company’s audited consolidated financial statements. Operating results for the three and nine months ended September 30, 2025 are not necessarily indicative of the results that may be expected for the year ending December 31, 2025. ​ Certain information and disclosures normally included in the notes to annual financial statements prepared in accordance with GAAP have been omitted from these interim financial statements pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Accordingly, these unaudited condensed consolidated financial statements should be read in conjunction with the financial statements for the fiscal year ended December 31, 2024, which are included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024 filed with the SEC. ​ S a le of Automation Business Line ​ Based on the achievement of certain contractual requirements for the year ended December 31, 2024, during the first quarter of 2025, the Company received additional proceeds in cash from the sale of its Automation business line from UST Global Inc. of $ 2.0 million. Additionally, pursuant to the purchase agreement, which provided for a working capital adjustment, the Company received $ 0.7 million from UST Global Inc. as final settlement during the third quarter of 2025. ​ Out-of-Period Adjustment ​ In conjunction with the Company’s close process for the second quarter of 2024, management identified a $ 0.5 million error related to revenue incorrectly recognized during the third quarter of 2022. Accordingly, the Company recorded a $ 0.5 million adjustment in the second quarter of 2024 to reduce revenue. Management evaluated the pre-tax impact of this error of $ 0.5 million on the Company’s previously reported interim and annual financial statements for Q3 2022 and full year 2022 and determined that the error was not material to any previously issued financial statements and 7 ​ that the out-of-period adjustment recorded in Q2 2024 was not material to the three or six months ended June 30, 2024. The error was not material to the nine months ended September 30, 2024, or the annual period ended December 31, 2024. ​ NOTE 3—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES ​ Use of Estimates ​ The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and revenues and expenses during the periods reported. Actual results may differ from those estimates. The complexity of the estimation process and issues related to the assumptions, risks and uncertainties inherent in the application of the revenue recognition guidance for contracts in which control is transferred to the customer over time affect the amounts of revenues, expenses, contract assets and contract liabilities. Numerous internal and external factors can affect estimates. Estimates are also used for but are not limited to allowance for credit losses, useful lives of furniture, fixtures and equipment and definite lived intangible assets, depreciation expense, fair value assumptions in evaluating goodwill for impairment, income taxes and deferred tax asset valuation and the valuation of stock-based compensation. ​ Restricted Cash ​ Restricted cash consists of cash and cash equivalents which the Company has committed for rent deposits and are not available for general corporate purposes. ​ Fair Value ​ The carrying value of the Company’s cash and cash equivalents, receivables, accounts payable, other current liabilities and accrued interest approximated their fair values as of September 30, 2025 and December 31, 2024 due to the short-term nature of these accounts. ​ Fair value measurements were applied with respect to the Company’s non-financial assets and liabilities measured on a nonrecurring basis, which would consist of measurements primarily to goodwill, intangible assets and other long-lived assets and assets acquired and liabilities assumed in a business combination. ​ Fair value is the price that would be received upon a sale of an asset or paid upon a transfer of a liability in an orderly transaction between market participants at the measurement date (exit price). Market participants can use market data or assumptions in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market-corroborated or generally unobservable. The use of unobservable inputs is intended to allow for fair value determinations in situations where there is little, if any, market activity for the asset or liability at the measurement date. Under the fair-value hierarchy: ​ ● Level 1 measurements include unadjusted quoted market prices for identical assets or liabilities in an active market; ​ ● Level 2 measurements include quoted market prices for identical assets or liabilities in an active market that have been adjusted for items such as effects of restrictions for transferability and those that are not quoted but are observable through corroboration with observable market data, including quoted market prices for similar assets; and ​ ● Level 3 measurements include those that are unobservable and of a highly subjective measure. ​ 8 ​ The following tables summarize the assets and liabilities (as applicable) measured at fair value on a recurring basis at the dates indicated: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Basis of Fair Value Measurements ​ ​ ​ September 30, 2025 ​ ​ Level 1 Level 2 Level 3 Total Assets: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash equivalents $ 97 $ — $ — $ 97 ​ Total $ 97 $ — $ — $ 97 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Liabilities: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Contingent consideration (1) $ — $ — $ 1,172 $ 1,172 ​ Total $ — $ — $ 1,172 $ 1,172 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Basis of Fair Value Measurements ​ ​ ​ December 31, 2024 ​ ​ Level 1 Level 2 Level 3 Total Assets: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash equivalents $ 84 $ — $ — $ 84 ​ Total $ 84 $ — $ — $ 84 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Liabilities: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Contingent consideration (1) $ — $ — $ 1,225 $ 1,225 ​ Total $ — $ — $ 1,225 $ 1,225 ​ (1) As of September 30, 2025, the current contingent consideration is included in “Accrued expenses and other current liabilities”. As of December 31, 2024, the current and noncurrent contingent consideration are included in “Accrued expenses and other current liabilities” and “Other liabilities”. ​ The following table represents the change in contingent consideration liability during the nine months ended September 30, 2025: ​ ​ ​ ​ ​ ​ ​ Nine Months Ended ​ September 30, ​ 2025 Beginning Balance ​ $ 1,225 ​ Change 4 Growth contingent consideration payment ​ ​ ( 550 ) ​ Martino & Partners contingent consideration accrued ​ ​ 468 ​ Accretion of contingent consideration ​ 29 ​ Ending Balance ​ $ 1,172 ​ ​ The Company’s accompanying unaudited condensed consolidated financial instruments include outstanding borrowings of $ 59.2 million at both September 30, 2025 and December 31, 2024, which are carried at amortized cost. The fair value of debt is classified within Level 3 of the fair value hierarchy. The fair value of the Company’s outstanding borrowings was approximately $ 59.5 million and $ 59.6 million as of September 30, 2025 and December 31, 2024, respectively. The fair values of debt have been estimated using a discounted cash flow analysis based on the Company’s incremental borrowing rate for similar borrowing arrangements. The incremental borrowing rate used to discount future cash flows was 5.8 % and 6.4 % as of September 30, 2025 and December 31, 2024, respectively. The Company also considered recent transactions of peer group companies for similar instruments with comparable terms and maturities as well as an analysis of current market conditions and interest rates. ​ 9 ​ Recently Issued Accounting Pronouncements ​ Income Taxes In December 2023, the Financial Accounting Standards Board (the “FASB”) issued updated guidance to enhance the transparency of income tax disclosure by requiring disaggregated information about an entity’s effective tax rate reconciliation, as well as information on taxes paid. This updated guidance is effective for annual periods beginning after December 15, 2024 and is not expected to have a material impact on the Company’s consolidated financial statements. ​ Income Statement Disaggregation In November 2024, the FASB issued ASU 2024-03 to improve the disaggregation of income statement expenses. This updated guidance requires additional disclosure of certain amounts included in the expense captions presented on the statement of operations as well as disclosures about selling expenses. The ASU is effective on a prospective basis, with the option for retrospective application, for annual periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027. Early adoption is permitted for annual financial statements that have not yet been issued. The Company does not expect ASU 2024-03 to have a material impact on the Company’s consolidated financial statements. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ NOTE 4—MARTINO & PARTNERS ACQUISITION On September 1, 2025, the Company completed the acquisition of Martino & Partners s.r.l. (“Martino & Partners”), a strategic advisory firm serving public and private sectors clients in Italy, for total consideration of EUR 2.0 million (USD 2.3 million) in cash paid at closing; USD 250,000 worth of shares of ISG’s common stock, issued promptly following the closing; and EUR 350,000 (USD 0.4 million) in cash, to be paid no later than April 30, 2028. Martino & Partners will also have the right to receive additional consideration paid via earn-out payments, if certain financial targets are met. The acquisition was accounted for as a business combination in accordance with Accounting Standards Codification (“ASC”) 805, Business Combinations . The following table summarizes the preliminary allocation of the purchase price to the estimated fair values of the assets acquired and liabilities assumed at the acquisition date (in thousands): ​ ​ ​ ​ Cash ​ $ 2,331 Deferred purchase consideration ​ ​ 410 Contingent liabilities ​ ​ 468 ISG common stock ​ ​ 250 Total allocable purchase price ​ $ 3,459 ​ ​ ​ ​ Current assets ​ $ 1,050 Intangible assets ​ ​ 1,020 Fixed assets ​ ​ 22 Current liabilities ​ ​ ( 376 ) Debt assumed ​ ​ ( 34 ) Net assets acquired ​ $ 1,682 ​ ​ ​ ​ Goodwill ​ $ 1,777 ​ The primary factors that drove the goodwill recognized, the majority of which is deductible for tax purposes, were the inclusion of legacy Martino & Partners workforce and the expansion of the Company’s client base, geographic footprint and capabilities in the European market. 10 ​ Costs associated with this acquisition are included in the selling, general and administrative expenses in the Consolidated Statement of Income and Comprehensive Income and totaled $ 0.08 million during the nine months ended September 30, 2025. Based on the valuation and other factors as described above, the purchase price assigned to intangible assets and the amortization period were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Purchase Price Estimated ​ Allocation Useful Lives Amortizable intangible assets: ​ ​ ​ ​ ​ Trademark and trade name ​ $ 220 3 years Customer relationships ​ ​ 760 ​ 7 years Noncompete agreements ​ ​ 40 ​ 4 years Total intangible assets ​ $ 1,020 ​ ​ ​ ​ ​ ​ NOTE 5—REVENUE ​ The majority of the Company’s revenue is derived from contracts that can span from a few months to several years. The Company enters into contracts that can include various combinations of services, which, depending on contract type, are sometimes capable of being distinct. If services are determined to be distinct, they are accounted for as separate performance obligations. A performance obligation is a promise in a contract to transfer a distinct good or service to the client and is the unit of account. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. The majority of the Company’s contracts have a single performance obligation as the respective promise to transfer the individual services is not separately identifiable from other promises in the contracts and, therefore, is not distinct. For contracts with multiple performance obligations, the Company allocates the transaction price to each performance obligation using its best estimate of the stand-alone selling price, or SSP, of each distinct product or service in the contract. The Company establishes SSP based on management’s estimated selling price or observable prices of products or services sold separately in comparable circumstances to similar clients. The Company’s contracts may include promises to transfer multiple services and products to a client. Determining whether services and products are considered distinct performance obligations that should be accounted for separately versus together may require judgment. Contract Balances The timing of revenue recognition, billings and cash collections result in billed accounts receivables, unbilled receivables (contract assets) and customer advances and deposits (contract liabilities). The Company’s clients are billed based on the type of arrangement. A portion of the Company’s services are billed monthly based on hourly or daily rates. There are also client engagements in which the Company bills a fixed amount for its services. This may be one single amount covering the whole engagement or several amounts for various phases, functions or milestones. Generally, billing occurs subsequent to revenue recognition, resulting in contract assets. However, the Company sometimes receives advances or deposits before revenue is recognized, resulting in contract liabilities. Contract assets and liabilities are generally reported in the current assets and current liabilities sections of the consolidated balance sheet, at the end of each reporting period, based on the timing of the satisfaction of the related performance obligation(s). For multi-year contract sales with annual invoicing, the Company performs a significant financing component calculation and recognizes the associated interest income throughout the duration of the financing period. In addition, it reclassifies the resulting contract asset balances as current and noncurrent receivables as receipt of the consideration is conditional only on the passage of time and there are no performance risk factors present. See the table below for a breakdown of the Company’s contract assets and contract liabilities as of the periods presented. ​ 11 ​ ​ ​ ​ ​ ​ ​ ​ ​ September 30, December 31, ​ 2025 2024 Contract assets ​ $ 19,249 ​ $ 18,335 Contract liabilities ​ $ 10,741 ​ $ 10,058 ​ Revenue recognized for the three and nine months ended September 30, 2025 that was included in the contract liability balance at January 1, 2025 was $ 0.6 million and $ 8.2 million, respectively, primarily representing revenue from the Company’s subscription, fixed-fee, and research contracts. Remaining Performance Obligations As of September 30, 2025, the Company had $ 111.3 million of remaining performance obligations, the majority of which are expected to be satisfied within the next twelve months. Accounts Receivable and Contract Assets During the fourth quarter of 2023, a client that had engaged the Company for two multi-year projects, which previously commenced in 2021 and 2022, respectively, failed to make payments as per the contracted payment schedule. As a result, the Company ceased performing services under the agreements. After unsuccessful negotiations, the Company provided the client with notice that it would be terminating the respective projects. Accordingly, during the fourth quarter of 2023, the Company recorded through bad debt expense an allowance for doubtful accounts reserve of $ 4.9 million associated with this client. The specific reserve recorded as of December 31, 2024 represented management’s best estimate of the probable amount of collection related to the outstanding amounts under these agreements. During the three months ended June 30, 2025, after exhausting all collection efforts on one of the projects, the Company wrote-off $ 3.6 million of the outstanding amounts against the previously established reserve. As all amounts written off were previously fully reserved, there was no incremental impact to the income statement in such period. As of September 30, 2025, $ 1.3 million of the reserve on the other multi-year project remains, and the Company is continuing to pursue legal action against the former client, which has resulted in a favorable judgment for ISG. As collection efforts are ongoing, actual collections from the client may differ from the Company’s estimate. ​ Separately, the Company is currently engaged in litigation with a client over a disputed accounts receivable balance for services rendered. As the Company believes the balance of approximately $ 4.7 million is collectible, it has not recorded a reserve. The Company will continue to reassess the need for a reserve in future periods. ​ NOTE 6—NET INCOME PER COMMON SHARE ​ Basic earnings per share is computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding for the period. Diluted earnings per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that would share in the net income of the Company. For the three and nine months ended September 30, 2025, 0.1 million and 2.1 million restricted stock units, respectively, and for the three and nine months ended September 30, 2024, 1.1 million and 4.7 million restricted stock units, respectively, have not been considered in the diluted earnings per share calculation, as the effect would be anti-dilutive. ​ ​ 12 ​ The following table sets forth the computation of basic and diluted earnings per share: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended September 30, ​ Nine Months Ended September 30, ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2025 2024 2025 2024 Basic: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income (loss) ​ $ 3,056 ​ $ 1,148 ​ $ 6,727 ​ $ ( 203 ) ​ Weighted average common shares ​ 48,132 ​ 48,940 ​ 48,258 ​ 48,743 ​ Earnings (loss) per share ​ $ 0.06 ​ $ 0.02 ​ $ 0.14 ​ $ ( 0.00 ) ​ Diluted: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income (loss) ​ $ 3,056 ​ $ 1,148 ​ $ 6,727 ​ $ ( 203 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Basic weighted average common shares ​ 48,132 ​ 48,940 ​ 48,258 ​ 48,743 ​ Potential common shares ​ 2,305 ​ 1,218 ​ 2,014 ​ — ​ Diluted weighted average common shares ​ 50,437 ​ 50,158 ​ 50,272 ​ 48,743 ​ Diluted earnings (loss) per share ​ $ 0.06 ​ $ 0.02 ​ $ 0.13 ​ $ ( 0.00 ) ​ ​ ​ NOTE 7—INCOME TAXES ​ The Company’s effective tax rate for the three and nine months ended September 30, 2025 was 27.2 % and 33.8 %, respectively, based on pretax income of $ 4.2 million and $ 10.2 million, respectively. The Company’s effective tax rate for the quarter ended September 30, 2025 was impacted by non-deductible expenses and earnings and losses in certain foreign jurisdictions. The Company’s effective tax rate for the three and nine months ended September 30, 2024 was 60.2 % and 112.9 % , respectively, based on pretax income of $ 2.9 million and $ 1.6 million, respectively. The Company’s effective tax rate for the quarter ended September 30, 2024 was impacted by non-deductible expenses and earnings and losses in certain foreign jurisdictions. ​ On July 4, 2025, the “One Big Beautiful Bill Act” (OBBBA) was signed into law, making significant changes to the U.S. federal tax code. At the date of issuance of these financial statements, the Company is currently in the process of evaluating the impacts of the legislation on its consolidated financial statements. ​ NOTE 8—COMMITMENTS AND CONTINGENCIES ​ The Company is subject to contingencies which arise through the ordinary course of business. All material liabilities of which management is aware are properly reflected in the financial statements as of September 30, 2025 and December 31, 2024. ​ Martino & Partners Contingent Consideration ​ As of September 30, 2025, the Company has recorded a liability of EUR 0.4 million (USD 0.5 million) representing the estimated fair value of contingent consideration related to the acquisition of Martino & Partners, which was classified as non-current and included in other liabilities on the consolidated balance sheet. ​ Ventana Research Contingent Consideration ​ On October 31, 2023, a subsidiary of the Company executed an Asset Purchase Agreement with Ventana Research, Inc. (“Ventana Research”) and consummated the acquisition of substantially all assets, and assumed certain liabilities, of Ventana Research. The purchase price comprised of $ 1.0 million of cash consideration paid at closing. 13 ​ Ventana Research will also have the right to receive additional consideration paid via earn-out payments, if certain financial targets are met. ​ As of September 30, 2025, the Company has recorded a liability of $ 0.7 million representing the estimated fair value of contingent consideration related to the acquisition of Ventana Research, which is classified as current and included in “Accrued expenses and other current liabilities” on the condensed consolidated balance sheet. ​ Change 4 Growth Contingent Consideration ​ On October 31, 2022, a subsidiary of the Company executed an Asset Purchase Agreement with Change 4 Growth, LLC (“Change 4 Growth”) and consummated the acquisition of substantially all the assets, and assumed certain liabilities, of Change 4 Growth. The purchase price was comprised of $ 3.8 million of cash consideration, $ 0.6 million of shares of ISG common stock issued promptly after closing and Change 4 Growth also had the right to receive additional consideration paid via earn-out payments, if certain financial targets were met. ​ The Company paid $ 0.5 million in cash consideration in April 2025, which was related to 2024 performance. The Company no longer has a related liability as of September 30, 2025. ​ Legal Reserves From time to time, the Company is a party to litigation, claims and other contingencies, including regulatory and employee matters as well as examinations and investigations by governmental agencies, which arise in the ordinary course of business. The Company records a contingent liability when it is probable that a loss has been incurred and the amount of loss is reasonably estimable in accordance with ASC Topic 450, Contingencies, or other applicable accounting standards. Such reserves are included in accrued liabilities on the condensed consolidated balance sheets. Based on the information available at the present time, the Company is unable to predict the ultimate outcome of any litigation or claims. However, the Company intends to vigorously defend its legal position on all claims and, to the extent necessary, seek recovery. NOTE 9—SEGMENT AND GEOGRAPHICAL INFORMATION ​ The Company operates as one reportable segment consisting primarily of fact-based sourcing advisory services. The Company operates principally in the Americas, Europe and Asia Pacific. ​ The Company’s Chief Operating Decision Maker (the “CODM”) is our Chairman & Chief Executive Officer, Michael Connors. The CODM uses net income as presented on our Consolidated Statement of Income and Comprehensive Income in evaluating performance and determining how to allocate resources of the Company as a whole. Geographical revenue information for the segment is as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ Nine Months Ended ​ ​ September 30, ​ September 30, ​ 2025 2024 2025 2024 Revenues ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Americas ​ $ 42,151 ​ $ 40,146 ​ $ 122,634 ​ $ 120,967 Europe ​ 16,010 ​ 16,199 ​ 46,440 ​ 52,796 Asia Pacific ​ 4,203 ​ 4,932 ​ 14,438 ​ 16,045 ​ ​ $ 62,364 ​ $ 61,277 ​ $ 183,512 ​ $ 189,808 ​ The segregation of revenues by geographic region is based upon the location of the legal entity performing the services. The Company does not measure or monitor gross profit or operating income by geography or any other measure or metric, other than consolidated, for the purposes of making operating decisions or allocating resources. ​ 14 ​ The following table represents a breakdown of net income that is used to help determine how resources are allocated: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ Nine Months Ended ​ ​ September 30, ​ September 30, ​ 2025 2024 ​ 2025 2024 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Revenue $ 62,364 $ 61,277 ​ $ 183,512 $ 189,808 Less: ​ ​ ​ ​ ​ ​ ​ ​ ​ Compensation expense ​ 40,700 ​ 40,488 ​ 121,248 ​ 124,055 Contract labor ​ ​ 5,424 ​ ​ 4,789 ​ ​ 14,174 ​ ​ 14,415 Third-party costs ​ 564 ​ 1,401 ​ 1,535 ​ 9,536 Travel and entertainment ​ ​ 2,314 ​ ​ 1,967 ​ ​ 7,266 ​ ​ 6,581 Professional fees ​ ​ 1,717 ​ ​ 1,689 ​ ​ 5,388 ​ ​ 4,924 Computer expense ​ ​ 1,131 ​ ​ 1,274 ​ ​ 3,509 ​ ​ 3,824 Restructuring costs ​ ​ 633 ​ ​ 586 ​ ​ 1,347 ​ ​ 4,263 Other segment expenses (1) ​ ​ 4,150 ​ ​ 3,191 ​ ​ 12,982 ​ ​ 11,912 Depreciation and amortization ​ ​ 1,143 ​ ​ 1,598 ​ ​ 3,413 ​ ​ 4,724 Interest income ​ ​ ( 23 ) ​ ​ ( 222 ) ​ ​ ( 115 ) ​ ​ ( 701 ) Interest expense ​ ​ 1,051 ​ ​ 1,604 ​ ​ 3,154 ​ ​ 4,672 Gain on the sale of business ​ ​ ( 720 ) ​ ​ — ​ ​ ( 720 ) ​ ​ — Foreign currency translation ​ ​ 81 ​ ​ 30 ​ ​ 174 ​ ​ 24 Income tax provision ​ ​ 1,143 ​ ​ 1,734 ​ ​ 3,430 ​ ​ 1,782 Net income (loss) ​ $ 3,056 ​ $ 1,148 ​ $ 6,727 ​ $ ( 203 ) (1) Other segment expenses include communication, occupancy, marketing, stock-based compensation, acquisition and disposition and other overhead expenses. ​ NOTE 10—FINANCING ARRANGEMENTS AND LONG-TERM DEBT ​ On February 22, 2023, the Company amended and restated its senior secured credit facility to increase the revolving commitments per the revolving facility from $ 54.0 million to $ 140.0 million and eliminate its term loan (as further amended, the “2023 Credit Agreement”). The material terms under the 2023 Credit Agreement are as follows. Capitalized terms used but not defined herein have the meanings ascribed to them in the 2023 Credit Agreement: ● The revolving credit facility has a maturity date of February 22, 2028. ● The credit facility is secured by all of the equity interests owned by the Company, and its direct and indirect domestic subsidiaries, and, subject to agreed exceptions, the Company’s direct and indirect “first-tier” foreign subsidiaries, and a perfected first priority security interest in all of the Company’s and its direct and indirect domestic subsidiaries’ tangible and intangible assets. ● The Company’s direct and indirect existing and future wholly owned domestic subsidiaries serve as guarantors to the Company’s obligations under the senior secured facility. ● At the Company’s option, the credit facility bears interest at a rate per annum equal to either (i) the “Base Rate” (which is the highest of (a) the rate publicly announced from time to time by the administrative agent as its “prime rate”, (b) the Federal Funds Rate plus 0.5 % per annum and (c) Term Secured Overnight Financing Rate (“SOFR”), plus 1.0 % ), plus the applicable margin, or (ii) Term SOFR (which is the Term SOFR screen rate for the relevant interest period plus a credit spread adjustment of 0.10 % ) as determined by the administrative agent, plus the applicable margin. The applicable margin is adjusted quarterly based upon the Company’s consolidated leverage ratio. For the first three months of 2025, the applicable margin was decreased by 0.25 % percentage of the revolving loans maintaining a Base Rate loans of 1.75 % for the revolving loans maintained as Term SOFR loans. 15 ​ ● The senior secured credit facility contains a number of covenants that, among other things, place restrictions on matters customarily restricted in senior secured credit facilities, including restrictions on indebtedness (including guarantee obligations), liens, fundamental changes, sales or dispositions of property or assets, investments (including loans, advances, guarantees and acquisitions), transactions with affiliates, dividends and other payments in respect of capital stock, optional payments and modifications of other material debt instruments, negative pledges and agreements restricting subsidiary distributions and changes in line of business. In addition, the Company is required to comply with a consolidated leverage ratio and consolidated interest coverage ratio. ● The senior secured credit facility contains customary events of default, including cross-default to other material agreements, judgment default and change of control provisions. The Company’s financial statements include outstanding borrowings of $ 59.2 million at both September 30, 2025 and December 31, 2024, which are carried at amortized cost. The fair value of debt is classified within Level 3 of the fair value hierarchy. The fair value of the Company’s outstanding borrowings was approximately $ 59.5 million and $ 59.6 million as of September 30, 2025 and December 31, 2024, respectively. The fair values of debt have been estimated using a discounted cash flow analysis based on the Company’s incremental borrowing rate for similar borrowing arrangements. The incremental borrowing rate used to discount future cash flows was 5.8 % and 6.4 % as of September 30, 2025 and December 31, 2024, respectively. The Company also considered recent transactions of peer group companies for similar instruments with comparable terms and maturities as well as an analysis of current market conditions and interest rates. During the nine months ended September 30, 2025, the Company borrowed $ 5.0 million and subsequently repaid $ 5.0 million of the revolver loan. The Company is currently in compliance with its financial covenants. ​ NOTE 11—LEASES ​ The Company recognizes lease payments in the Consolidated Statements of Income and Comprehensive Income on a straight-line basis over the lease term. As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at the commencement date in determining the present value of the lease payments. The Company leases its office space and office equipment under long-term operating lease agreements that expire at various dates through November 2036, some of which include options to extend the leases for up to 5 years , and some of which included options to terminate the leases within one year . Under the operating leases, the Company pays certain operating expenses relating to the office equipment and leased property. In April 2025, the Company entered into a new operating eleven-year lease for approximately 17,500 square feet of office space in Stamford, Connecticut and includes annual base rent of $ 0.9 million, subject to annual escalation of 2 % with an option to terminate the lease effective on the seventh anniversary of the rent commencement date. The lease commencement date was September 29, 2025, and the rent commencement date is expected to be December 2026. The following table summarizes the balance sheet amounts related to the new lease as of September 30, 2025: ​ ​ ​ ​ ​ (In thousands, except lease term and discount rate) ​ September 30, ​ 2025 Operating lease ​ ​ ​ Operating lease right-of-use asset ​ $ 6,975 ​ ​ ​ ​ Current operating lease liability ​ $ 354 Non-current operating lease liability ​ 6,547 Total operating lease liability ​ $ 6,901 ​ ​ ​ ​ Remaining lease term (in years) ​ ​ ​ Operating lease ​ ​ 11.2 Discount rate ​ ​ ​ Operating lease ​ ​ 6.7 % ​ ​ ​ ​ 16 ​ ​ ​ NOTE 12—SUBSEQUENT EVENTS ​ On October 31, 2025 , the Company’s Board of Directors (the “Board”) approved a fourth-quarter dividend of $ 0.045 per share, payable December 19, 2025 , to shareholders of record as of December 5, 2025 . The dividends are accounted for as a decrease to Stockholders’ Equity. All future dividends will be subject to the Board’s prior approval. ​