What changed in this filing

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Item 7. Management’s Discussion and Analysis

2026-03-16 compared with 2025-02-20 · 115 added, 75 removed, 398 unchanged (32% of the section changed)

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A discussion of our financial condition and results of operations for the fiscal year ended December 31, 2023 and year-to-year comparisons between fiscal 2024 and fiscal 2023 can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, filed on February 20, 2025

We are Kaltura, Inc.

(“Kaltura,” “we,” “us,” or “our”), a market-leading provider of live, real-time, and on-demand video offerings for enterprises, with a mission to “create and power AI-infused hyper-personalized video experiences for organizations, that boost customer and employee engagement and success”.

Founded in 2006, we pioneered the concept of leveraging video as a core data type within organizational workflows.

Today, our Video Experience Cloud includes our platforms for Enterprise Video Content Management System (including Real-Time Conferencing, Live Streaming and Lecture Capture) and TV Content Management System.

These platforms power our AI-infused, video-first products:

Video Portals, LMS & CMS Video Extensions, Virtual Events & Webinars, Virtual Classroom, and TV Streaming Applications.

We, Kaltura, Inc.

(“Kaltura,” “we,” “us,” or “our”), are a market-leading provider of video and rich media offerings for enterprises.

Our mission is to power rich, agentic digital experiences across organizational journeys for customers, employees, learners, and audiences.

Kaltura's Digital Experience Platform enables organizations to create, manage, and deliver video and rich media experiences that increasingly incorporate agentic artificial intelligence (“AI”) capabilities, including conversational interfaces, workflow automation, and outcome-oriented engagement across digital touchpoints.

We believe this combination of video, rich media and agentic capabilities enables organizations to move beyond static, one-size-fits-all digital experiences toward more personalized, contextual, and interactive agentic digital experiences at scale.

Video and other forms of rich media - including interactive, data-driven, and conversational media - are central to digital interaction and engagement, transforming how people communicate, work, learn, and consume content.

For organizations, rich media increasingly sits at the core of digital transformation initiatives, with businesses adopting media-driven solutions to engage customers, employees, learners, and audiences across a growing range of use cases.

At the same time, advances in generative artificial intelligence (“Gen AI”) are enabling the real-time and automated creation of highly personalized and contextually relevant content, including video and other forms of rich media.

We believe the convergence of rich media and AI is increasing the scale, speed, and strategic importance of digital experiences and driving demand for platforms that support more interactive, contextual, and outcome-oriented engagement.

Founded in 2006, Kaltura was among the pioneers to recognize the potential of integrating video into enterprise workflows and to offer a system for enterprise video content management and online video publishing.

Over time, we expanded our platform to support additional experiences, including virtual events and webinars and cloud-based television services.

Today, Kaltura provides a cloud-based rich media platform designed to help organizations create, manage, and deliver rich media experiences at scale across customer-facing, employee-facing, learner-facing, and audience-facing use cases.

Our Digital Experience platform is designed around three core layers:

rich media content creation, rich media content management, and rich media experiences.

Together, these layers enable organizations to produce and generate live and on-demand video and other forms of rich media, securely manage content, users, permissions, and metadata across enterprise and media environments, and deliver media-rich experiences across a wide range of internal and external workflows.

The platform increasingly incorporates agentic AI-driven capabilities designed to enable more interactive, contextual, and goal-oriented experiences, while maintaining enterprise-grade security, privacy, and governance.

As video usage continues to accelerate across communication, work, and learning environments, organizations are increasingly deploying sophisticated video solutions to further engage with their customers, partners, and employees.

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We believe this powerful new tool will expand opportunities for increased video creation, consumption, and monetization, and drives a need for advanced video content management solutions.

To support our AI capabilities, in 2025, we acquired eSelf AI, a multimodal AI lab developing technology for agentic interactions with live avatars.

Through this acquisition, we expanded our content creation and experience capabilities to include AI-generated video and avatar-based interactions, enhancing our rich media content creation layer.

In addition, in March, 2026, we entered into a definitive agreement to acquire PathFactory, a provider of content journey orchestration and engagement analytics solutions.

We believe this acquisition, once completed, would strengthen our position in the emerging conversation automation and agentic engagement solutions market and complement our recent acquisition of eSelf AI by adding journey-level orchestration, intent data, analytics, and integrations across additional content types and enterprise systems.

The transaction has not yet closed, and there can be no assurance that it will be completed or that the anticipated benefits will be realized.

We generate revenue primarily from the sale of Software-as-a-Service (“SaaS”) subscriptions, and we also derive revenue from platform usage license subscriptions and associated professional services.

Our sales typically target medium to large enterprises, educational institutions, technology providers, and media and telecom companies.

In addition, we are expanding our go-to-market approaches to support a wider range of adoption models and customer sizes.

Our professional services revenue is generally driven by implementation and support services for new and existing customers.

In August 2025, our Board of Directors approved a reorganization plan (the “2025 Reorganization Plan) that included, among other things, downsizing approximately 10% of our workforce and adapting our organizational structure, roles, and responsibilities accordingly.

The total cost reduction from the downsizing in connection with the 2025 Reorganization Plan on an annualized basis is expected to be approximately $8.5 million.

The 2025 Reorganization Plan, which was completed in the third quarter of 2025, is focused on realigning the Company’s operations to further increase efficiency and productivity, alongside our integration of enhanced AI-based technologies, to align the Company’s business strategy in light of uncertainties in the current macro-economic climate, and to support the Company’s growth and profitability initiatives.

We organize our business into two reporting segments:

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and (ii) Media and Telecom (“M&T”).

Accordingly, our financial reporting distinguishes between revenue and gross profit from Subscription and Professional Services from customers who use our products and services to address Entertainment & Monetization use cases, reported in our M&T segment, and those that are attained from customers who are using us to address all other use cases, reported in our “EE&T segment“.

Accordingly, our financial reporting distinguishes between revenue and gross profit from Subscription and Professional Services from customers who use our products and services to address Entertainment & Monetization use cases (for their audiences), reported in our M&T segment, and those that are attained from customers who are using us to address all other use cases (for their customers, employees, and learners), reported in our EE&T segment.

These segments share a common underlying platform consisting of our API-based architecture, as well as unified product development, operations, and administrative resources.

• Enterprise, Education and Technology (“EE&T”):

• Enterprise, Education & Technology :

In the EE&T segment, subscription revenue is primarily generated on a per full‑time equivalent or platform usage‑license basis for all of our products, in addition to revenue derived from associated professional services.

This segment encompasses customers utilizing Kaltura’s solutions across Customer Experience and Employee Experience and use cases - including Marketing, Sales & Customer Success;

Teaching, Learning, Training & Certification;

and Communication & Collaboration.

This segment encompasses customers utilizing Kaltura’s solutions to deliver agentic rich-media experiences for their customers, employees, and learners such as buyer enablement, employee recruiting, learning and teaching.

Contracts in this segment typically range from 12 to 24 months, with billing generally executed on an annual basis.

• Media & Telecom (“M&T”):

The M&T segment includes revenue from our Entertainment & Monetization use cases, along with the associated professional services.

For customers of our telecom TV Content Management System (TVCMS) and TV Streaming Applications, revenue is recognized primarily on a per end‑subscriber basis, while media customers leveraging our Online Video Platform (OVP) are billed on a platform usage‑license basis.

• Media & Telecom :

The M&T segment includes revenue from customers using Kaltura to deliver entertainment and streaming use cases to their audiences, along with the associated professional services.

For customers of our telecom TVCMS and TV Streaming Applications, revenue is recognized primarily on a per end‑subscriber basis, while media customers leveraging our Online Video Platform are billed on a platform usage‑license basis.

Contracts in this segment generally extend for two to five years, with billing performed on either a quarterly or annual basis.

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We employ a “land and expand” strategy with the aim of having our customers increase their usage of our offerings and/or purchase additional offerings over time.

For the years ended December 31, 2024 and 2023, our Net Dollar Retention Rate was 100% and 101%, respectively.

We also grew our Annualized Recurring Revenue (as defined below), by 6% in the year ended December 31, 2024, compared to the year ended December 31, 2023, demonstrating our ability to land new customers with higher spending levels and increase revenue from our existing customers.

For the years ended December 31, 2025 and 2024, our Net Dollar Retention Rate was 100%.

Our Annualized Recurring Revenue (as defined below), declined by 3% in the year ended December 31, 2025, compared to the year ended December 31, 2024.

For any given year, a large majority of our revenue comes from existing customers, with whom we are in active dialogue and tend to have visibility into their expected usage of our offerings.

As part of our go-to-market strategy, we focus on direct sales to larger enterprise, education, and media & telecom customers while also investing in channel partnerships, and in 'inside sales' for smaller customers.

We believe ongoing demand for secure, scalable, and deeply integrated video solutions—further amplified by the rise of Gen AI—positions us for future growth.

Our strategy remains centered on broadening our product suite, expanding our customer base across industries, and increasing recurring revenue from existing clients.

We are expanding our go-to-market approaches to support a wider range of adoption models and customer sizes.

We believe certain of our newer offerings, particularly AI-assisted content creation tools and conversational rich media agents, are well suited for more targeted departmental deployments, self-service adoption, and product-led growth (“PLG”) motions.

These offerings may enable us to engage smaller organizations, teams, and departments, including small and medium-sized businesses (“SMBs”) and individual groups within larger enterprises, while remaining complementary to our core enterprise business.

In addition, we are investing in developer-led growth (“DLG”) initiatives by expanding our APIs, SDKs, and developer tools, including planned offerings such as an Agentic Avatar SDK.

These capabilities are designed to enable independent software vendors (“ISVs”), system integrators, partners, and developers to embed Kaltura-powered rich media and conversational interfaces into their own products, workflows, and applications.

We also intend to continue expanding our ecosystem of channel partners, including co-sell, resell, OEM, and marketplace relationships.

We believe that broader partner distribution, including through cloud marketplaces and digital channels, may increase reach, reduce customer acquisition costs, and accelerate adoption across both enterprise and self-service use cases.

Key Factors Affecting Our Performance

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We believe that increasing brand awareness and continued product innovation will help us attract new customers across geographies and industries.

We also continue to provide our self-serve offering that can be purchased completely online, which also serves as a demand generation engine for our low-touch and enterprise offerings.

We believe this will enable us to efficiently acquire smaller customers across all industries over time – expanding beyond enterprises into SMEs, beyond universities into K-12 schools, beyond tier 1 media and telecom companies to tier 2 and 3 media and telecom companies, and beyond providing Media Services to large technology companies to also addressing smaller technology firms and startups.

We also continue to provide our self-serve offering that can be purchased completely online, which serves as a demand generation engine for our low-touch and enterprise offerings.

We believe this will enable us to efficiently acquire smaller customers across all industries over time – expanding beyond enterprises into SMEs, beyond universities into K-12 schools, beyond tier 1 media and telecom companies to tier 2 and 3 media and telecom companies, and beyond providing our platform to large technology companies to also addressing smaller technology firms and startups.

Increasing Revenue from Existing Customers

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By cross-selling and upselling additional solutions — such as our newly introduced Gen AI-powered capabilities and expanded application suites — we aim to drive higher usage and expand overall revenue.

Sustained customer adoption and usage growth are also supported by strong integration, ongoing support, and a commitment to evolving security and compliance requirements.

Our strong integration, ongoing support, and a commitment to evolving security and compliance requirements also helps us support sustained customer adoption and usage growth.

We are focused on increasing sales within our existing customer base through increased usage of our platform and the cross-selling of additional products and solutions.

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We believe there is a significant opportunity to continue our growth.

We expect that our cost of revenue and operating expenses will fluctuate.

We expect that our cost of revenue and operating expenses will fluctuate over time.

Key Financial and Operating Metrics

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(in thousands, except percentages)

Annualized Recurring Revenue $ 173,900 $ 164,723 $ 159,238

Net Dollar Retention Rate 100 % 101% (a)

Net Dollar Retention Rate 100 % 100 % 101 %

As of December

2025 2024 2023

(in thousands)

Remaining Performance Obligations (1)

(a) The Net Dollar Retention Rate for the year ended December 31, 2023 has been recast to reflect the update to our customer count methodology, as discussed further below, which has resulted in an adjustment of 1 percentage point to the reported Net Dollar Retention Rate for such period.

The Net Dollar Retention Rate for the year ended December 31, 2022 was not impacted by this update.

$ 166,347 $ 176,947 $ 165,010

Annualized Recurring Revenue $ 168,197 $ 173,900 $ 164,723

(1) Remaining Performance Obligations as of December 31, 2024 and December 31, 2023 reflect a reassessment of the historical treatment of certain customer contracts that contain “termination for convenience” clauses, which has resulted in a negative adjustment of $26,432 and,$20,295, respectively.

Annualized Recurring Revenue

We use Annualized Recurring Revenue ("ARR") as a measure of our revenue trend and an indicator of our future revenue opportunity from existing recurring customer contracts.

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For annual periods, we report Net Dollar Retention Rate as the arithmetic average of the Net Dollar Retention Rate for all fiscal quarters included in the period.

As previously disclosed, in 2024 we updated our customer count methodology, which is used to calculate our Net Dollar Retention Rate, to treat subdivisions of the same legal entity (for example, divisions of a parent company or separate campuses that are part of the same state university system), as well as Value-add Resellers (“VARs”) (meaning resellers that directly manage the relationship with the customer) and the customers they manage, to be a single customer.

We consider subdivisions of the same legal entity (for example, divisions of a parent company or separate campuses that are part of the same state university system) ,as well as Value-add Resellers (“VARs”) (meaning resellers that directly manage the relationship with the customer) and the customers they manage, to be a single customer for purposes of calculating our Net Dollar Retention Rate.

Our calculation of Net Dollar Retention Rate for any fiscal period includes the positive recognized recurring revenue impacts of selling new services to existing customers and the negative recognized recurring revenue impacts of contraction and attrition among this set of customers.

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In addition to our results determined in accordance with GAAP, we believe that EBITDA and Adjusted EBITDA, non-GAAP financial measures, are useful in evaluating the performance of our business.

We define EBITDA as net profit (loss) before interest expense, net, provision for income taxes and depreciation and amortization expenses.

Adjusted EBITDA is defined as EBITDA (as defined above), adjusted for the impact of certain non-cash and other items that we believe are not indicative of our core operating performance, such as non-cash stock-based compensation expenses, facility exit and transition costs, restructuring charges, other non-recurring operating expenses and costs related to conflicts in Israel.

We define EBITDA as net profit (loss) before financial expenses (income), net, provision for income taxes and depreciation and amortization expenses.

Adjusted EBITDA is defined as EBITDA (as defined above), adjusted for the impact of certain non-cash and other items that we believe are not indicative of our core operating performance, such as non-cash stock-based compensation expenses, facility exit and transition costs, war-related expenses, restructuring charges, certain professional consulting and other expenses associated with strategic initiatives and acquisition related expenses.

EBITDA and Adjusted EBITDA are supplemental measures of our performance, are not defined by or presented in accordance with GAAP, and should not be considered in isolation or as an alternative to net profit (loss) or any other performance measure prepared in accordance with GAAP.

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War related costs (d)

Strategic initiatives expenses (e)

Acquisition related expenses (f)

Adjusted EBITDA $ 18,647 $ 7,273 $ (2,500)

(a) The year ended December 31, 2024, 2023 and 2022 includes $2.7 million, $3.2 million and $2.3 million, respectively, of interest expenses ,and $3.4 million , $2.7 million and $1.0 million , respectively, of interest income.

(b) Facility exit and transition costs for the years ended December 31, 2023 and December 31, 2022 include losses from sale of fixed assets and other costs associated with moving to our temporary office in Israel.

(a) The years ended December 31, 2025, 2024 and 2023 include $2.2 million, $2.7 million and $3.2 million, respectively, of interest expenses, and $3.0 million , $3.4 million and $2.7 million , respectively, of interest income.

(b) Facility exit and transition costs for the year ended December 31, 2023 include losses from sale of fixed assets and other costs associated with moving to our temporary office in Israel.

(c) The year ended December 31, 2025, includes employee termination benefits incurred in connection with the 2025 Reorganization Plan and the year ended December 31, 2023 includes employee termination benefits incurred in connection with the 2023 Restructuring Plan.

(d) The years ended December 31, 2024 and 2023 include costs related to conflicts in Israel.

(d) The years ended December 31, 2024 and December 31, 2023 include costs related to conflicts in Israel.

These costs are attributable to the temporary relocation of key employees from Israel for business continuity purposes, the purchase of emergency equipment for key employees, charitable donations to communities directly impacted by the war, and office fixes and modifications.

(e) Strategic initiatives expenses for the year ended December 31, 2025 relate to professional fees, consulting services and other costs associated with strategic initiatives.

(f) Acquisition related expenses for the year ended December 31, 2025 consist of professional fees, consulting services and other transaction-related costs incurred in connection with the acquisition of eSelf AI.

Components of Results of Operations

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Additional expenses include marketing program costs and amortization of acquired customer relationships intangible assets.

We expect our sales and marketing expenses to be relatively stable as a percentage of revenue.

We expect our sales and marketing expenses to increase as a percentage of revenue.

General and Administrative Expenses

Our general and administrative expenses consist primarily of personnel-related costs for our executive, finance, human resources, information technology, and legal functions, including salaries and other direct personnel-related costs.

Additional expenses include costs for other operational and administrative functions, professional fees for external legal, accounting, and consulting services, directors’ and officers’ insurance, and strategic initiatives.

We expect our general and administrative expenses to gradually decrease as a percentage of revenue.

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General and administrative expenses 40,838 46,009 (5,171) (11) %

Restructuring — 973 (973) (100) %

Restructuring 903 — 903 NM

Total operating expenses 132,632 143,205 (10,573) (7) %

Loss from operations 4,963 24,099 (19,136) (79) %

Financial Income, net (434) (1,200) 766 (64) %

Financial expenses (income), net 4,047 (434) 4,481 (1032) %

Loss before provision for income taxes 9,010 23,665 (14,655) (62) %

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EE&T professional services revenue decreased by $0.9 million, or 21%, to $3.6 million for the year ended December 31, 2025, from $4.5 million for the year ended December 31, 2024.

The decrease in professional services revenue mainly reflects the transition of certain development projects to ongoing support and maintenance, now recognized as subscription revenue.

Enterprise, Education & Technology Gross Profit

EE&T gross profit increased by $7.0 million, or 7%, to $104.0 million for the year ended December 31, 2025, from $96.9 million for the year ended December 31, 2024.

This increase was mainly due to a $3.6 million increase in revenue, and reduction in production costs, which is a result of improved efficiency.

This increase was mainly due to a $5.7 million increase in revenue, lower headcount and reduction in production costs, which is a result of improved efficiency.

EE&T subscription gross profit increased by $7.6 million, or 7%, to $108.9 million for the year ended December 31, 2025, from $101.3 million for the year ended December 31, 2024.

EE&T professional services gross loss increased by $0.6 million, or 13%, to $4.9 million for the year ended December 31, 2025, from a gross loss of $4.4 million for the year ended December 31, 2024 .

The increase was primarily due to a reduction in professional services revenue.

Media & Telecom

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Media & Telecom Revenue

M&T revenue remained unchanged, totaling $50.0 million for both the year ended December 31, 2024 and the year ended December 31, 2023.

M&T subscription revenue increased by $1.3 million, or 3%, to $43.5 million for the year ended December 31, 2024, from $42.2 million for the year ended December 31, 2023 the increase is mainly attributable to $1.3 million increase in revenue from existing customers.

Total M&T revenue decreased by $3.6 million, or 7% to $46.4 million for the year ended December 31, 2025, from $50.0 million for the year ended December 31, 2024.

The decrease is mainly attributable to $3.6 million decrease in revenue from existing customers.

M&T subscription revenue decreased by $2.4 million, or 6%, to $41.1 million for the year ended December 31, 2025, from $43.5 million for the year ended December 31, 2024.

M&T professional services revenue decreased by $1.2 million, or 18%, to $5.4 million for the year ended December 31, 2025, from $6.5 million for the year ended December 31, 2024.

The decrease is mainly attributable to the completion of setup for certain customers in the year ended December 31, 2023, for which professional services revenue was recognized at that time.

Media & Telecom Gross Profit

M&T gross profit increased by $1.5 million, or 7%, to $23.7 million for the year ended December 31, 2025, from $22.2 million for the year ended December 31, 2024.

The increase is primarily driven by reduced compensation costs resulting from improved efficiency in production and operations, as well as an increase in subscription revenue, which typically carries higher gross margins.

M&T subscription gross profit increased by $0.5 million, or 2%, to $23.8 million for the year ended December 31, 2024, from $23.4 million for the year ended December 31, 2023.

M&T professional services gross loss decreased by $1.1 million, or 39%, to a gross loss of $1.7 million for the year ended December 31, 2024, from a gross loss of $2.7 million for the year ended December 31, 2023.

This increase was mainly due to reduction in production and other costs, which is a result of improved efficiency, and reductions in headcount and subcontractor costs following organizational changes implemented at the end of 2024 and in August 2025.

M&T subscription gross profit decreased by $0.3 million, or 1%, to $23.6 million for the year ended December 31, 2025, from $23.8 million for the year ended December 31, 2024.

M&T professional services gross profit increased by $1.8 million, or 108%, to a gross profit of $0.1 million for the year ended December 31, 2025, from a gross loss of $1.7 million for the year ended December 31, 2024.

The increase in professional services gross profit was primarily driven by reductions in headcount and subcontractor costs following organizational changes implemented at the end of 2024 and in August 2025.

Operating Expenses

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Research and development expenses decreased by $3.4 million, or 7%, to $46.0 million for the year ended December 31, 2025, from $49.4 million for the year ended December 31, 2024.

The decrease was primarily due to a $2.3 million decrease in compensation expenses which mainly related to lower headcount, and a $1.0 million decrease in IT related expenses, partially offset by a $0.4 million increase in subcontractors and consultants expenses mainly as a result of outsourcing part of the efforts related to specific projects.

The decrease was primarily due to a $2.9 million decrease in compensation expenses which were driven by the full recognition of high fair value RSUs granted in December 2021, which were fully expensed prior to 2025.

In addition the decrease was also due to a $1.0 million decrease in subcontractor and consultant costs, primarily attributable to reduced use of outsourced resources.

Sales and Marketing Expenses

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Employee compensation & commission $ 35,943 $ 39,182 $ (3,239) (8) %

Subcontractors and consultants 932 685 247 36 %

IT related 1,244 1,131 113 10 %

Marketing expenses 3,244 3,366 (122) (4) %

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Sales and marketing expenses decreased by $2.9 million, or 6%, to $44.9 million for the year ended December 31, 2025, from $47.8 million for the year ended December 31, 2024.

The decrease was primarily due to a $0.6 million decrease in other marketing expenses mainly due to improved efficiency in managing the marketing budget and a $0.4 million decrease in travel expenses.

The decrease was primarily due to a $3.2 million decrease in compensation expenses mainly due to lower headcount and full recognition of high fair value RSUs granted in December 2021, which were fully expensed prior to 2025.

General and Administrative Expenses

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Unused cloud hosting commitment expense — 1,312 (1,312) NM

Strategic initiatives 1,284 — 1,284 NM

Acquisition related expenses 428 — 428 NM

Other 2,039 2,211 (172) (8) %

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General and administrative expenses decreased by $5.2 million or 11% , to $40.8 million for the year ended December 31, 2025, from $46.0 million for the year ended December 31, 2024.

The decrease was primarily due to a $3.6 million decrease in compensation expense mainly resulting from the departure of several senior executives whose market-based equity awards were canceled.

The cancellation of these equity awards led to a reversal and reduction in stock-based compensation expenses.

This decrease was partially offset by the cancellation of the CEO's market-based equity awards, which resulted in an acceleration of expenses, and $1.3 million of unused one-time expense associated with terminating commitments with a cloud hosting service provider.

The decrease was primarily due to a $4.8 million decrease in compensation costs mainly driven by expense acceleration recognized in the comparative period in connection with the cancellation of unvested market-based equity awards granted to the Chief Executive Officer, and by lower stock-based compensation costs, largely reflecting the full recognition of high fair value options and RSUs granted in December 2021, which were fully expensed prior to 2025.

The decrease also reflects a $1.3 million one-time expense in 2024 associated with the termination of commitments with a cloud hosting service provider.

These were partially offset by a $1.3 million increase in strategic initiatives costs, primarily due to professional, consulting, and other expenses, as well as by a $0.4 million increase in acquisition related expenses, incurred in connection with the acquisition of eSelf AI.

Restructuring

There were no restructuring expenses during the year ended December 31, 2024.

Restructuring expenses were $0.9 million for the year ended December 31, 2025 due to the 2025 Reorganization Plan being implemented in the third quarter of 2025 and consisting of employee severance and related costs.

Financial Expenses (Income), net

Financial income, net decreased by $0.8 million, or 64%, to $0.4 million, for the year ended December 31, 2024, from $1.2 million for the year ended December 31, 2023.

The change was mainly related to lower income attributed to foreign currency translation adjustments, net, partially offset by higher interest income on our marketable securities and money market funds and lower interest expenses on our Credit Facilities (see below).

Financial expense (income), net changed by $4.5 million, to $4.0 million expense, for the year ended December 31, 2025, from $0.4 million income for the year ended December 31, 2024.

The change was mainly related to increased expense of $4.5 million related to exchange rate differences primarily driven by the revaluation of NIS‑denominated liabilities.

As the USD weakened against the NIS during 2025, these liabilities were remeasured at a lower USD–ILS exchange rate, resulting in a higher carrying amount in USD terms and consequently higher foreign exchange expenses.

Provision for Income Taxes

Provision for income taxes decreased by $1.3 million, or 14%, to $7.7 million for the year ended December 31, 2024, from $8.9 million for the year ended December 31, 2023, primarily due to a decreased tax liability related to income generated by our subsidiaries organized under the laws of Israel and the United Kingdom.

Provision for income taxes decreased by $4.6 million, or 60%, to $3.1 million for the year ended December 31, 2025, from $7.7 million for the year ended December 31, 2024, primarily due to a decreased tax liability related to income generated by our subsidiaries organized under the laws of Israel.

Liquidity and Capital Resources

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however, such financing may not be available on favorable terms, or at all.

In particular, the current global economic volatility, rising inflation and interest rates, price increases, decrease in our customers' spend or available budget, and the ongoing conflict between Russia and Ukraine, have resulted in, and may continue to result in, significant disruption of global financial markets, reducing our ability to access capital.

In particular, the current global economic volatility, including due to uncertainty around U.S.

and foreign tariffs and other trade barriers, rising inflation and uncertainty with respect to interest rates, price increases and supply chain issues, deteriorating global political conditions and various other factors, has resulted in, and may continue to result in, significant disruption of global financial markets, reducing our ability to access capital.

Our ability to access capital may also be impacted by political, economic, and military conditions in Israel, including the current security situation or any escalation of conflicts with Israel, and in other regions in which we operate, or changes in the business environment in those regions.

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Repurchase Program

On June 11, 2024, the Company’s board of directors authorized a stock repurchase program of the Company’s outstanding common stock for up to $5.0 million of the Company’s common stock (the “Repurchase Program”).

Under the Repurchase Program, the Company may make repurchases, from time to time, through open market purchases, block trades, in privately negotiated transactions, accelerated stock repurchase transactions, or by other means.

The Company may also, from time to time, enter into Rule 10b5-1 plans to facilitate repurchases under this authorization.

The volume, timing, and manner of any repurchases will be determined at the Company’s discretion, subject to general market conditions, as well as the Company’s management of capital, general business conditions, other investment opportunities, regulatory requirements and other factors.

The Repurchase Program does not obligate the Company to repurchase any specific amount of common stock, has no time limit, and may be modified, suspended, or discontinued at any time without notice at the discretion of the Board of Directors.

In June 2024, the Company’s Board of Directors authorized a stock repurchase program of the Company’s outstanding common stock (the “2024 Repurchase Program”), which provided for repurchases up to a total of $5 million thereunder.

Subsequently, in March 2025, the Board approved a new repurchase program (the “2025 Repurchase Program”), providing for repurchases up to a total of $15 million thereunder, which superseded the 2024 Repurchase Program.

On November 7, 2025, pursuant to additional repurchase authority approved by the Board, the Company entered into a stock purchase agreement (the “2025 Stock Purchase Agreement” ) with Special Situations Investing Group II, LLC (the “Sellers”), pursuant to which the Company has repurchased 14,443,739 shares of Common Stock from the Sellers at a purchase price of $16,610,300, representing a price per share of $1.15 for each of the Company’s share of common stock, calculated on the basis of a 25% discount over the average daily VWAP over the 30-day period ending on November 5, 2025.

In addition, the Board terminated the 2025 Repurchase Program.

During the year ended December 31, 2025, the Company repurchased 19,087,579 shares of common stock at an weighted average price of $1.37 per share (excluding broker and transaction fees of $139).

As of December 31, 2024, the Company had remaining authorization under the Repurchase Program to repurchase common stock up to an aggregate amount of $2,148,055, subject to satisfying required conditions under the Companies Law and Companies Regulations.

Credit Facilities

In January 2021, we entered into a new credit agreement (as amended, the “Credit Agreement”) with one of our existing lenders, which provides for a new senior secured term loan facility in the aggregate principal amount of $40.0 million (the “Term Loan Facility”) and a new senior secured revolving credit facility in the aggregate principal amount of $10.0 million (the “Revolving Credit Facility” and, together with the Term Loan Facility, the “Credit Facilities”), which thereafter were extended and amended to align our business needs and other developments.

In January 2021, we entered into a credit agreement (as amended, the “Credit Agreement”) with one of our existing lenders, which provided for a senior secured term loan facility in the aggregate principal amount of $40.0 million (the “Term Loan Facility”) and a senior secured revolving credit facility in the aggregate principal amount of $10.0 million (the “Revolving Credit Facility” and, together with the Term Loan Facility, the “Credit Facilities”), which thereafter were extended and amended to align our business needs and other developments.

In December 2023, we refinanced all amounts outstanding under the then-existing Credit Agreement, and entered into a new amendment to the credit agreement (the “Fifth Amendment”) with an existing lender, which provides for an additional term loan facility of $3.5 million in addition to the existing $31.5 million in term loans outstanding immediately prior to the Fifth Amendment.

Commitments under the Revolving Credit Facility decreased to $25.0 million.

In July 2024, we entered into an amendment to the Credit Agreement with an existing lender, in connection with our Repurchase Program, which updated the aggregate amount of permitted Restricted Payments (as defined in the Credit Agreement, which term includes, among others, the repurchase of the Company’s outstanding common stock) and conditions for making such payments.

In July 2024, we entered into an amendment to the Credit Agreement with an existing lender, in connection with our share repurchase program, which updated the aggregate amount of permitted Restricted Payments (as defined in the Credit Agreement, which term includes, among other things, the repurchase of the Company’s outstanding common stock) and conditions for making such payments.

In March 2025 and October 2025, the Company entered into additional amendments to the Credit Agreement, each of which provided for, among other things, an increase to the aggregate amount of permitted Restricted Payments and updates to the conditions for making such payments to facilitate the Company’s repurchases of securities.

On October 20, 2025, the Company entered into an amendment to the Credit Agreement, which provided for, among other things, an increase to the aggregate amount of permitted Restricted Payments and updates to the conditions for making such payments to facilitate the Company’s repurchases of securities.

The amount available for borrowing under the Revolving Credit Facility is limited to a borrowing base, which is equal to the product of (a) 500% (which will automatically reduce to 350% on the date the Term Loan Facility is repaid in full), multiplied by (b) monthly Recurring Revenue for the most recently ended monthly period, multiplied by (c) the Retention Rate (in each case, as defined in the Credit Agreement).

The Revolving Credit Facility includes a sub-facility for letters of credit in the aggregate availability amount of $10.0 million and a swingline sub-facility in the aggregate availability amount of $5.0 million, each of which reduces borrowing availability under the Revolving Credit Facility.

Borrowings under the Credit Facilities bear interest, determined as follows:

Following the effectiveness of the Fifth Amendment, borrowings under the Credit Facilities are subject to interest, determined as follows:

(a) SOFR loans accrue interest at a rate per annum equal to Term SOFR (as defined in the Credit Agreement) plus 0.10% per annum plus a margin of 2.50% (the Adjusted Term SOFR (as defined in the Credit Agreement) is subject to a 1.00% floor), and (b) ABR loans accrue interest at a rate per annum equal to the ABR plus a margin of 1.50% (ABR is equal to the highest of (i) the prime rate and (ii) the Federal Funds Effective Rate plus 0.50%, subject to a 2.00% floor).

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All voluntary prepayments (other than ABR loans borrowed under the Revolving Credit Facility) must be accompanied by accrued and unpaid interest on the principal amount being prepaid and customary “breakage” costs, if any, with respect to prepayments of SOFR loans.

The Term Loan Facility is payable in consecutive quarterly installments on the last day of each fiscal quarter in an amount equal to (i) $0.4 million for installments payable on December 31, 2023 (deferred to January 9, 2024), through September 30, 2024 (ii) $0.7 million for installments payable on December 31, 2024 ($0.2 million of the amount deferred to January 2025), through September 30, 2025, (iii) $1.3 million for installments payable on and after December 31, 2025.

The Term Loan Facility is payable in consecutive quarterly installments on the last day of each fiscal quarter in an amount equal to (i) $0.4 million for installments payable on December 31, 2023 (deferred to January 9, 2024), through September 30, 2024 (ii) $0.7 million for installments payable on December 31, 2025 ($0.2 million of the amount deferred to January 2025), through September 30, 2025, and (iii) $1.3 million for installments payable on and after December 31, 2025.

The remaining unpaid balance on the Term Loan Facility is due and payable on December 21, 2026, together with accrued and unpaid interest on the principal amount to be paid to, but excluding, the payment date.

Amounts outstanding under the Credit Facilities may be voluntarily prepaid at any time and from time to time, in whole or in part, without premium or penalty.

Our obligations under the Credit Facilities are currently guaranteed by Kaltura Europe Limited, and are required to be guaranteed by all of our future direct and indirect subsidiaries other than certain excluded subsidiaries and immaterial foreign subsidiaries.

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The Credit Agreement also contains certain financial covenants that require us to maintain (i) a minimum amount of Consolidated Adjusted EBITDA (as defined in the Credit Agreement) as of the last day of each fiscal quarter (which minimum amount increased through the fiscal quarter ended December 31, 2025) (the “Adjusted EBITDA Covenant”), and (ii) Liquidity (as defined in the Credit Agreement) of at least $20 million as of the last day of any calendar month.

On July 22, 2024, we revised the Credit Agreement to modify the definition of “Liquidity” to include certain additional cash and cash equivalents.

We were in compliance with these covenants as of December 31, 2025.

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(in thousands)

Net cash provided by (used in) operating activities $ 12,233 $ (8,303)

Net cash used in investing activities (12,414) (1,583)

Net cash provided by (used in) financing activities (3,534) 109

Net cash provided by operating activities $ 14,541 $ 12,233

Net cash provided by (used in) investing activities 9,050 (12,414)

Net cash used in financing activities (29,651) (3,534)

Effect of exchange rate changes on cash, cash equivalents and restricted cash

Net increase in cash, cash equivalents, and restricted cash (3,625) (9,049)

Net decrease in cash, cash equivalents, and restricted cash (5,538) (3,625)

Cash, cash equivalents, and restricted cash at beginning of period 33,159 36,784

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Net cash provided by operating activities of $14.5 million for the year ended December 31, 2025, was primarily due to $12.1 million in incremental net loss, adjusted for non-cash charges of $31.3 million, and net cash of $4.7 million due to changes in our operating assets and liabilities.

Non-cash charges primarily consisted of depreciation and amortization of $4.5 million, stock-based compensation expenses of $16.5 million and amortization of deferred contract acquisitions and fulfillment costs of $11.2 million, partially offset by non-cash interest income, net of $0.3 million and gain on foreign exchange of $0.5 million.

The main drivers of net cash outflows that were derived from the changes in operating assets and liabilities were related to an increase in deferred contract acquisition costs of $5.1 million, an increase of $2.8 million in prepaid expenses and other current assets, a total decrease in employee accruals, accrued expenses, and other liabilities of $1.9 million, a decrease in deferred revenue of a $0.8 million, partially offset by a decrease in trade receivables of a $3.6 million, a net change in operating right-of-use asset and lease liability of $1.5 million and an increase in trade payables of $0.7 million.

Net cash provided by operating activities of $12.2 million for the year ended December 31, 2024, was primarily due to $31.3 million in incremental net loss, adjusted for non-cash charges of $41.6 million, and net cash of $2.1 million due to changes in our operating assets and liabilities.

Non-cash charges primarily consisted of depreciation and amortization of $5.1 million, stock-based compensation expenses of $26.3 million and amortization of deferred contract acquisitions and fulfillment costs of $11.4 million.

The main drivers of net cash inflows that were derived from the changes in operating assets and liabilities were related to an increase of $5.4 million in accrued expenses and other current liabilities, a decrease in trade receivables of $3.3 million, an increase of $2.7 million in employees and payroll accruals and an increase of $0.5 million in deferred revenue, partially offset by an increase in deferred contract acquisition costs of $7.5 million, an increase of $1 million in prepaid expenses and other current assets and a decrease in trade payables of $0.5 million.

Net cash used in operating activities of $8.3 million for the year ended December 31, 2023, was primarily due to $46.4 million in incremental net loss, adjusted for non-cash charges of $45.3 million, and net cash of $6.6 million due to changes in our operating assets and liabilities.

Non-cash charges primarily consisted of depreciation and amortization of $4.7 million, stock-based compensation expenses of $30.0 million and amortization of deferred contract acquisitions and fulfillment costs of $11.7 million.

The main drivers of net cash outflows that were derived from the changes in operating assets and liabilities were related to an addition to deferred contract acquisition costs of $6.6 million, decrease in trade payables of $5.9 million and an aggregate decrease of $1.8 million in employees accruals, accrued expenses and other current liabilities, partially offset by a decrease in trade receivables of $5.5 million, increase in deferred revenue of $1.6 million, and an increase in prepaid expenses and other assets of $0.6 million.

Investing Activities

Net cash flows used in investing activities increased by $10.8 million to $12.4 million for the year ended December 31, 2024 as compared to the year ended December 31, 2023.

Net cash used in investing activities of $12.4 million for the year ended December 31, 2024 was related to investment in available-for-sale marketable securities of $50.9 million and $0.5 million in capital expenditures, offset by maturities of available-for-sale marketable securities of $39.0 million.

Net cash used in investing activities of $1.6 million for the year ended December 31, 2023 was related to investment in available-for-sale marketable securities of $47.7 million, $2.6 million in capital expenditures, $1.5 million of capitalized internal use software and investment in restricted bank deposits of $1.8 million, partially offset by maturities of available-for-sale marketable securities of $52.0 million.

Net cash flows provided by investing activities increased by $21.5 million to $9.1 million for the year ended December 31, 2025 as compared to the year ended December 31, 2024.

Net cash provided by investing activities of $9.1 million for the year ended December 31, 2025 was related to maturities of available-for-sale marketable securities of $71.0 million, partially offset by investment in available-for-sale marketable securities of $54.1 million, payments for businesses acquired of $7.1 million and $0.7 million in capital expenditures.

Net cash used in investing activities of $12.4 million for the year ended December 31, 2024 was related to investment in available-for-sale marketable securities of $50.9 million and $0.5 million in capital expenditures, partially offset by maturities of available-for-sale marketable securities of $39.0 million.

Financing Activities

Net cash flows used in financing activities increased by $26.1 million for the year ended December 31, 2025 as compared to the year ended December 31, 2024.

Net cash used in financing activities of $29.7 million for the year ended December 31, 2025 was primarily due to repurchase of common stock of $26.2 million, $3.5 million of loan repayments, cash settlement of equity classified share-based payment awards of $3.1 million partially offset by proceeds from the exercise of stock options of $3.1 million.

Net cash used in financing activities of $3.5 million for the year ended December 31, 2024 was primarily due to repurchase of common stock of $2.9 million and $2.2 million of loan repayments partially offset by proceeds from the exercise of stock options of $1.6 million.

Net cash provided by financing activities of $0.1 million for the year ended December 31, 2023 was primarily due to proceeds from long-term loans, net of debt issuance cost of $3.5 million and proceeds from option exercises of $1.4 million, partially offset by $4.5 million of loan repayments.

Contractual Obligations and Commitments

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As a result, our consolidated financial statements and the reported results of operations contained therein may not be directly comparable to those of other public companies.

We expect to cease being an emerging growth company as of December 31, 2026.

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