What changed in this filing

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Item 1. Financial Statements

2025-02-04 compared with 2024-11-07 · 113 added, 73 removed, 432 unchanged (30% of the section changed)

52 unchanged sentences

(in thousands, except per share data)

September 30, 2024

December 31, 2024

June 30, 2024

2 unchanged sentences

Restricted cash

Accounts receivable, net of allowance of $ 1,117 and $ 1,406 as of September 30, 2024 and June 30, 2024, respectively

Accounts receivable, net of allowance of $ 989 and $ 1,406 as of December 31, 2024 and June 30, 2024, respectively

Unbilled receivables, net

23 unchanged sentences

Preferred stock, $ 0.001 par value per share, 50,000 shares authorized;

no shares issued or outstanding as of September 30, 2024 and June 30, 2024, respectively

no shares issued or outstanding as of December 31, 2024 and June 30, 2024, respectively

Common stock, $ 0.001 par value per share, 700,000 shares authorized;

77,285 and 74,624 shares issued and outstanding as of September 30, 2024 and June 30, 2024, respectively

79,234 and 74,624 shares issued and outstanding as of December 31, 2024 and June 30, 2024, respectively

Additional paid-in capital

6 unchanged sentences

(in thousands, except per share data)

Three Months Ended September 30,

Three Months Ended December 31,

Six Months Ended December 31,

Professional services

11 unchanged sentences

Net loss before income taxes

Income tax expense

Income tax benefit (expense)

Net loss per share, basic and diluted

3 unchanged sentences

(in thousands)

Three Months Ended September 30,

Three Months Ended December 31,

Six Months Ended December 31,

Other comprehensive income (loss):

5 unchanged sentences

(in thousands)

Three Months Ended September 30, 2024

Three Months Ended December 31, 2024

Comprehensive

Total Stockholders'

Balance as of June 30, 2024

Balance as of September 30, 2024

Issuance of common stock upon exercise of stock options

Vesting of performance stock units and restricted stock units

Issuance of common stock under employee stock purchase plan

Stock-based compensation

Foreign currency translation adjustments

Balance as of December 31, 2024

Three Months Ended December 31, 2023

Comprehensive

Total Stockholders'

Balance as of September 30, 2023

Three Months Ended September 30, 2023

Issuance of common stock upon exercise of stock options

Vesting of performance stock units and restricted stock units

Issuance of common stock under employee stock purchase plan

Stock-based compensation

Foreign currency translation adjustments

Balance as of December 31, 2023

See accompanying notes to unaudited condensed consolidated financial statements.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(in thousands)

Six Months Ended December 31, 2024

Comprehensive

3 unchanged sentences

Vesting of performance stock units and restricted stock units

Issuance of common stock under employee stock purchase plan

Stock-based compensation

Issuance of common stock upon follow-on public offering, net of offering costs of $ 1,569

Foreign currency translation adjustments

Balance as of September 30, 2023

Balance as of December 31, 2024

Six Months Ended December 31, 2023

Comprehensive

Total Stockholders'

Balance as of June 30, 2023

Issuance of common stock upon exercise of stock options

Vesting of performance stock units and restricted stock units

Issuance of common stock under employee stock purchase plan

Stock-based compensation

Issuance of common stock upon follow-on offering, net of offering costs of $ 1,569

Foreign currency translation adjustments

Balance as of December 31, 2023

See accompanying notes to unaudited condensed consolidated financial statements.

1 unchanged sentence

(in thousands)

Three Months Ended September 30,

Six Months Ended December 31,

Cash Flows from Operating Activities:

24 unchanged sentences

Proceeds from stock option exercises

Proceeds from employee stock purchase plan

Payments of deferred contingent consideration and holdback associated with acquisitions

14 unchanged sentences

Capitalized internal-use software costs in accounts payable and accrued liabilities

Deferred offering costs in accounts payable and accrued liabilities

Deferred consideration and acquisition holdbacks in accounts payable, accrued and other liabilities

Fair value of contingent consideration in accrued and other liabilities

See accompanying notes to unaudited condensed consolidated financial statements.

14 unchanged sentences

The interim unaudited condensed consolidated financial statements have been prepared on a basis consistent with the annual consolidated financial statements and, in the opinion of management, reflect all adjustments, which include only normal and recurring adjustments, necessary to state fairly the Company’s financial condition, its operations and cash flows for the periods presented.

The historical results are not necessarily indicative of future results, and the results of operations for the three months ended September 30, 2024 are not necessarily indicative of the results to be expected for the full year or any other period.

The historical results are not necessarily indicative of future results, and the results of operations for the three and six months ended December 31, 2024 are not necessarily indicative of the results to be expected for the full year or any other period.

Certain prior period amounts reported in our unaudited condensed consolidated financial statements and notes thereto have been reclassified to conform to the current year presentation.

31 unchanged sentences

The Company has not experienced any such losses.

No client individually accounted for 10% or more of the Company’s revenues for either of the three months ended September 30, 2024 and 2023.

As of September 30, 2024 , no client individually accounted for 10% or more of the Company’s total accounts receivable.

No client individually accounted for 10% or more of the Company’s revenues for either of the three and six months ended December 31, 2024 and 2023.

As of December 31, 2024 , no client individually accounted for 10% or more of the Company’s total accounts receivable.

As of June 30, 2024 , one client individually accounted for 16 % of the Company’s total accounts receivable.

10 unchanged sentences

The Company expects the adoption to result in additional disclosures only.

In November 2024, the FASB issued ASU No.

2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (ASC 220):

Disaggregation of Income Statement Expenses , which requires disclosures, on an annual and interim basis, about specific expense categories presented on the income statement.

This guidance will be effective for the Company's fiscal year beginning July 1, 2027, and should be applied on either a prospective or retrospective basis.

The Company is currently evaluating the impact of the adoption on its consolidated financial statements.

Disaggregation of Revenues

Revenues by geography were as follows (in thousands):

Three Months Ended September 30,

Three Months Ended December 31,

Six Months Ended December 31,

Rest of the world

No country other than those listed above accounted for 10% or more of the Company’s total revenues during the three months ended September 30, 2024 and 2023.

No country other than those listed above accounted for 10% or more of the Company’s total revenues during the three and six months ended December 31, 2024 and 2023.

Deferred Commissions

Deferred commissions were $ 30.7 million and $ 32.4 million as of September 30, 2024 and June 30, 2024 , respectively.

Amortization expense with respect to deferred commissions, which is included in sales and marketing expense in the Company’s unaudited condensed consolidated statements of operations, was $ 4.0 million and $ 3.5 million for the three months ended September 30, 2024 and 2023, respectively.

Deferred commissions were $ 32.6 million and $ 32.4 million as of December 31, 2024 and June 30, 2024 , respectively.

Amortization expense with respect to deferred commissions, which is included in sales and marketing expense in the Company’s unaudited condensed consolidated statements of operations, was $ 4.1 million and $ 8.0 million for the three and six months ended December 31, 2024 , respectively, and $ 3.6 million and $ 7.1 million for the three and six months ended December 31, 2023 .

There was no impairment loss in relation to the costs capitalized for the periods presented.

1 unchanged sentence

The Company’s contract assets and liabilities were as follows (in thousands):

September 30, 2024

December 31, 2024

June 30, 2024

1 unchanged sentence

Deferred revenue, net

(1) The long-term portion of $ 202 thousand and $ 63 thousand as of September 30, 2024 and June 30, 2024 , respectively is included in other assets on the unaudited condensed consolidated balance sheets.

There was no allowance for credit losses associated with unbilled receivables as of September 30, 2024 and June 30, 2024.

During the three months ended September 30, 2024 and 2023 the Company recognized $ 88.5 million a nd $ 65.3 million in revenue pertaining to deferred revenue as of June 30, 2024 and 2023, respectively.

(1) The long-term portion of $ 217 thousand and $ 63 thousand as of December 31, 2024 and June 30, 2024 , respectively is included in other assets on the unaudited condensed consolidated balance sheets.

There was no allowance for credit losses associated with unbilled receivables as of December 31, 2024 and June 30, 2024.

During the six months ended December 31, 2024 and 2023 the Company recognized $ 149.3 million and $ 125.1 million in revenue pertaining to deferred revenue as of June 30, 2024 and 2023, respectively.

Remaining Performance Obligations

2 unchanged sentences

Professional services contracts are not included in the performance obligations amount.

As of September 30, 2024 , approximately $ 549.4 million of revenues is expected to be recognized from remaining performance obligations with approximately 56 % over the next 12 months and the remainder thereafter.

As of December 31, 2024 , approximately $ 615.3 million of revenues is expected to be recognized from remaining performance obligations with approximately 55 % over the next 12 months and the remainder thereafter.

Business Combinations

In connection with the acquisition of Transform Data International B.V.

and its subsidiaries ("TDI") on May 1, 2024 , the Company paid $ 0.9 million to the seller for certain working capital adjustments during the three months ended September 30, 2024.

and its subsidiaries ("TDI") on May 1, 2024 , the Company paid $ 0.9 million to the seller for certain working capital adjustments during the six months ended December 31, 2024.

This was included in the purchase price and is recorded in investing activities in the Company's unaudited condensed consolidated statements of cash flows.

5 unchanged sentences

Foreign currency translation adjustment

Balance as of September 30, 2024

Balance as of December 31, 2024

Intangible Assets

Intangible assets acquired through business combinations consisted of the following (in thousands):

September 30, 2024

December 31, 2024

Gross Carrying Amount

16 unchanged sentences

Amortization expense related to acquired intangible assets was recognized as follows (in thousands):

Three Months Ended September 30,

Three Months Ended December 31,

Six Months Ended December 31,

Sales and marketing

1 unchanged sentence

Total amortization expense

As of September 30, 2024, the estimated future amortization expense for acquired intangible assets is as follows (in thousands):

As of December 31, 2024, the estimated future amortization expense for acquired intangible assets is as follows (in thousands):

Fiscal Year Ending June 30,

10 unchanged sentences

The following table sets forth the Company’s financial assets that were measured at fair value on a recurring basis as of the date indicated by level within the fair value hierarchy (in thousands):

September 30, 2024

December 31, 2024

Financial assets:

8 unchanged sentences

The following tables set forth the Company’s financial liabilities that were measured at fair value on a recurring basis as of the dates indicated by level within the fair value hierarchy (in thousands):

September 30, 2024

December 31, 2024

Financial Liabilities:

9 unchanged sentences

The fair value of the contingent consideration liability was measured based on the probability of achieving certain performance measures pursuant to the acquisition agreement.

The total fair value of the contingent consideration liability was $ 0.8 million as of September 30, 2024 and June 30, 2024 , of which $ 0.1 million was included as part of purchase consideration upon acquisition and $ 0.7 million was accounted for as post-combination compensation costs to be recognized over the required service period.

Accordingly, the Company recorded a contingent consideration liability of $ 0.2 million as of September 30, 2024 and June 30, 2024 in other liabilities on the unaudited condensed consolidated balance sheets.

The total fair value of the contingent consideration liability was $ 0.8 million as of December 31, 2024 and June 30, 2024 , of which $ 0.1 million was included as part of purchase consideration upon acquisition and $ 0.7 million was accounted for as post-combination compensation costs to be recognized over the required service period.

Accordingly, the Company recorded a contingent consideration liability of $ 0.3 million as of December 31, 2024 and $ 0.2 million as of June 30, 2024 in other liabilities on the unaudited condensed consolidated balance sheets.

In connection with the acquisition of Paragon Data Labs, Inc.

1 unchanged sentence

The fair value was measured based on the probability of achieving certain performance measures pursuant to the acquisition agreement.

During the three months ended September 30, 2024 , the Company paid $ 1.4 million related to the contingent consideration.

The fair value of the contingent consideration was not material as of September 30, 2024 and was $ 2.4 million as of June 30, 2024, which was included in other current liabilities on the unaudited condensed consolidated balance sheets.

During the six months ended December 31, 2024 , the Company made a fair value adjustment of $ 1.0 million based on the probability of achieving certain performance measures and paid $ 1.4 million related to the contingent consideration.

Accordingly, the contingent consideration was fully settled as of December 31, 2024 , as compared to the fair value of $ 2.4 million as of June 30, 2024, which was included in other current liabilities on the unaudited condensed consolidated balance sheets.

The fair value of the contingent consideration was initially estimated on the acquisition date using the Monte Carlo simulation and included key assumptions used by management related to the estimated probability of occurrence and discount rates.

3 unchanged sentences

Changes in contingent consideration liabilities were as follows (in thousands):

Three Months Ended September 30,

Six Months Ended December 31,

Balance, beginning of period

7 unchanged sentences

Costs related to software acquired, developed, or modified solely to meet the Company’s internal requirements, with no substantive plans to market such software at the time of development, or costs related to development of our hosted SaaS products are capitalized during the application development stage.

The Company capitalized $ 1.6 million and $ 1.5 million of costs related to software developed for internal use during the three months ended September 30, 2024 and 2023 , respectively.

The Company capitalized $ 3.5 million and $ 3.1 million of costs related to software developed for internal use during the six months ended December 31, 2024 and 2023 , respectively.

Capitalized stock-based compensation expense was not material for the periods presented.

Amortization expense related to capitalized internal-use software was $ 0.9 million and $ 0.8 million for the three months ended September 30, 2024 and 2023 , respectively, and was recognized in cost of revenues related to SaaS in the unaudited condensed consolidated statements of operations.

The net book value of capitalized internal-use software was $ 14.2 million and $ 13.5 million as of September 30, 2024 and June 30, 2024 , respectively.

Amortization expense related to capitalized internal-use software was $ 0.9 million for the three months ended December 31, 2024 and 2023 , and was $ 1.9 million and $ 1.7 million for the six months ended December 31, 2024 and 2023 , respectively, and was recognized in cost of revenues related to SaaS in the unaudited condensed consolidated statements of operations.

The net book value of capitalized internal-use software was $ 15.1 million and $ 13.5 million as of December 31, 2024 and June 30, 2024 , respectively.

Capitalized internal-use software costs are recorded in property and equipment on the Company’s unaudited condensed consolidated balance sheets.

3 unchanged sentences

The capitalized implementation costs are amortized on a straight-line basis over the term of the associated cloud computing arrangement when the module or component of the cloud computing arrangement is ready for its intended use in the same line item as fees for the associated cloud computing arrangement in the unaudited condensed consolidated statements of operations.

The Company capitalized $ 0.8 million and $ 1.0 million of costs related to cloud computing implementation during the three months ended September 30, 2024 and 2023 , respectively.

The Company capitalized $ 1.9 million and $ 2.1 million of costs related to cloud computing implementation during the six months ended December 31, 2024 and 2023 , respectively.

Capitalized stock-based compensation expense was not material for the periods presented.

Amortization expense related to capitalized cloud computing implementation costs was $ 0.1 million and no ne for the three months ended September 30, 2024 and 2023 , respectively.

The net book value of capitalized cloud computing implementation costs was $ 4.8 million as of September 30, 2024 , out of which $ 1.0 million is recorded as part of prepaid expenses and $ 3.8 million is recorded as part of other assets based on the term of the associated cloud computing arrangement.

Amortization expense related to capitalized cloud computing implementation costs was $ 0.2 million and no ne for the three months ended December 31, 2024 and 2023 , respectively.

The net book value of capitalized cloud computing implementation costs was $ 5.7 million as of December 31, 2024 , out of which $ 1.3 million is recorded as part of prepaid expenses and $ 4.4 million is recorded as part of other assets based on the term of the associated cloud computing arrangement.

The net book value of capitalized cloud computing implementation costs was $ 4.1 million as of June 30, 2024 , out of which $ 0.6 million is recorded as part of prepaid expenses and $ 3.5 million is recorded as part of other assets based on the term of the associated cloud computing arrangement.

2 unchanged sentences

The components of lease costs were as follows (in thousands):

Three Months Ended September 30,

Three Months Ended December 31,

Six Months Ended December 31,

Operating Leases:

4 unchanged sentences

Lease Term and Discount Rate:

September 30, 2024

September 30, 2023

December 31, 2024

December 31, 2023

Weighted-average remaining lease term (in years)

1 unchanged sentence

The following table presents supplemental cash flow information related to the Company's operating leases (in thousands):

Three Months Ended September 30,

Six Months Ended December 31,

Cash payments included in the measurement of operating lease liabilities

ROU assets obtained in exchange for new operating lease liabilities

Current operating lease liabilities of $ 5.6 million and $ 6.0 million were included in other current liabilities on the Company’s unaudited condensed consolidated balance sheets as of September 30, 2024 and June 30, 2024, respectively.

As of September 30, 2024, remaining maturities of operating lease liabilities are as follows (in thousands):

Current operating lease liabilities of $ 5.1 million and $ 6.0 million were included in other current liabilities on the Company’s unaudited condensed consolidated balance sheets as of December 31, 2024 and June 30, 2024, respectively.

As of December 31, 2024, remaining maturities of operating lease liabilities are as follows (in thousands):

Fiscal Year Ending June 30,

7 unchanged sentences

The Company’s other purchase commitments primarily consist of third-party cloud services, support fees and software subscriptions to support operations in the ordinary course of business.

There were no material purchase commitments that were entered into during the three months ended September 30, 2024.

There were no material purchase commitments that were entered into during the six months ended December 31, 2024.

In December 2021, the Company entered into an agreement with Microsoft, pursuant to which the Company is committed to spend a minimum of $ 110.0 million on cloud services.

The committed spend period concludes at the end of December 2028 , with the Company having the option to extend any remaining commitment into a further 12 -month period to the end of December 2029 .

As of September 30, 2024, the Company had $ 90.9 million remaining on this commitment.

As of December 31, 2024, the Company had $ 86.5 million remaining on this commitment.

From time to time, the Company is a party to claims, lawsuits, and proceedings which arise in the ordinary course of business.

13 unchanged sentences

It also contains affirmative, negative and financial covenants, including limitations on certain other indebtedness, loans and investments, liens, mergers, asset sales, and transactions with affiliates, as well as customary events of default.

The Company was in compliance with all covenants as of September 30, 2024.

As of September 30, 2024 and June 30, 2024 , there were no outstanding borrowings under the JPMorgan Credit Facility.

The Company was in compliance with all covenants as of December 31, 2024.

As of December 31, 2024 and June 30, 2024 , there were no outstanding borrowings under the JPMorgan Credit Facility.

S tockholders' Equity and Stock-Based Compensation

9 unchanged sentences

Stock options granted generally become exercisable ratably over a four-year period following the date of grant and expire ten years from the date of grant.

Stock option activity under the Company’s equity incentive plans during the three months ended September 30, 2024 was as follows (in thousands, except per share data):

Stock option activity under the Company’s equity incentive plans during the six months ended December 31, 2024 was as follows (in thousands, except per share data):

Balance as of June 30, 2024

Balance as of September 30, 2024

Vested and exercisable as of September 30, 2024

Vested and expected to vest as of September 30, 2024

Balance as of December 31, 2024

Vested and exercisable as of December 31, 2024

Vested and expected to vest as of December 31, 2024

(1) Aggregate intrinsic value for stock options represents the difference between the exercise price and the per share fair value of the Company’s common stock as of the end of the period, multiplied by the number of stock options outstanding.

There were no stock options granted during the three months ended September 30, 2024.

The total intrinsic value of stock options exercised and the proceeds from option exercises during the three months ended September 30, 2024 were $ 67.3 million and $ 22.9 million, respectively.

There were no stock options granted during the six months ended December 31, 2024.

The total intrinsic value of stock options exercised and the proceeds from option exercises during the six months ended December 31, 2024 were $ 125.9 million and $ 32.6 million, respectively.

PSUs and RSUs

During the three months ended September 30, 2024, the Company granted PSUs to certain of its employees with vesting terms based on meeting certain operating performance targets, including annual recurring revenue and profitability targets, and continued service conditions.

During the six months ended December 31, 2024, the Company granted PSUs to certain of its employees with vesting terms based on meeting certain operating performance targets, including annual recurring revenue and profitability targets, and continued service conditions.

The Company also granted RSUs to certain employees that vest based on continued service.

PSU activity during the three months ended September 30, 2024 was as follows (in thousands, except per share data):

PSU activity during the six months ended December 31, 2024 was as follows (in thousands, except per share data):

Number of Shares

Balance as of June 30, 2024

Balance as of September 30, 2024

RSU activity during the three months ended September 30, 2024 was as follows (in thousands, except per share data):

Balance as of December 31, 2024

RSU activity during the six months ended December 31, 2024 was as follows (in thousands, except per share data):

Number of Shares

Balance as of June 30, 2024

Balance as of September 30, 2024

Balance as of December 31, 2024

Stock-Based Compensation Expense

The Company recorded stock-based compensation expense in the unaudited condensed consolidated statements of operations as follows (in thousands):

Three Months Ended September 30,

Three Months Ended December 31,

Six Months Ended December 31,

Cost of revenues

5 unchanged sentences

Total stock-based compensation

During the three months ended September 30, 2024, the Company modified the performance conditions related to certain PSU awards, which results in an improbable-to-probable modification with an increase in unrecognized stock-based compensation expense of approximately $ 14.8 million to be recognized through the remaining requisite service period.

As of September 30, 2024 , there was approximately $ 200.7 million of unrecognized compensation cost related to unvested stock-based awards granted, which is expected to be recognized over the weighted-average period of approximately 2.7 years.

During the six months ended December 31, 2024 , the Company modified the performance conditions related to certain PSU awards, which results in an improbable-to-probable modification with an increase in unrecognized stock-based compensation expense of approximately $ 14.8 million to be recognized through the remaining requisite service period.

As of December 31, 2024 , there was approximately $ 179.4 million of unrecognized compensation cost related to unvested stock-based awards granted, which is expected to be recognized over the weighted-average period of approximately 2.5 years.

2021 Employee Stock Purchase Plan

1 unchanged sentence

The ESPP provides an offering period that begins on June 1 and December 1 of each year and each offering period consists of one six-month purchase period.

As of September 30, 2024 , total unrecognized compensation cost related to the ESPP was $ 0.2 million, which will be amortized over a weighted-average vesting term of 0.2 years.

During the six months ended December 31, 2024 , 67,464 shares were purchased under the ESPP.

As of December 31, 2024 , total unrecognized compensation cost related to the ESPP was $ 0.6 million, which will be amortized over a weighted-average vesting term of 0.4 years.

The Company determines its income tax provision for interim periods using an estimate of its annual effective tax rate adjusted for discrete items occurring during the periods presented.

The primary difference between its effective tax rate and the federal statutory rate is the full valuation allowance the Company has established on its federal and state net operating losses and credits.

Income taxes from international operations were not material for the three months ended September 30, 2024 and 2023.

The primary difference between its effective tax rate and the federal statutory

rate is the full valuation allowance the Company has established on its federal and state net operating losses and credits.

Income taxes from international operations were not material for the three and six months ended December 31, 2024 and 2023.

The Company files income tax returns in the U.S.

10 unchanged sentences

The following table sets forth the computation of basic and diluted net loss per share for the periods presented (in thousands, except per share data):

Three Months Ended September 30,

Three Months Ended December 31,

Six Months Ended December 31,

Weighted-average shares used to compute net loss per share, basic and diluted

1 unchanged sentence

The Company excluded the following potential shares of common stock from the calculation of diluted net loss per share because their effect would be anti-dilutive (in thousands):

As of September 30,

As of December 31,

Outstanding stock options to purchase common stock

3 unchanged sentences

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

What changed 10-Q

Item 1. Financial Statements