MAGNITE, INC. 10-K

Item 8. Financial Statements and Supplementary Data MAGNITE, INC. INDEX TO CONSOLIDATED FINANCIAL STATEMENTS Report of Independent Registered Public Accounting Firm (PCAOB ID No. 34 ) 62 Consolidated Financial Statements: Consolidated Balance Sheets 65 Consolidated Statements of Operations 66 Consolidated Statements of Comprehensive Income (Loss) 67 Consolidated Statements of Stockholders' Equity 68 Consolidated Statements of Cash Flows 69 Notes to Consolidated Financial Statements 71 61 Table of Contents REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the stockholders and the Board of Directors of Magnite, Inc. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Magnite, Inc. and subsidiaries (the "Company") as of December 31, 2025 and 2024, the related consolidated statements of operations, comprehensive loss, stockholders' equity, and cash flows, for each of the three years in the period ended December 31, 2025, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America. We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 25, 2026, expressed an unqualified opinion on the Company's internal control over financial reporting. Basis for Opinion These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matters The critical audit matters communicated below are matters arising from the current-period audit of the financial statements that were communicated or required to be communicated to the audit committee and that (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate. Revenue — Refer to Notes 2 and 4 to the financial statements Critical Audit Matter Description The Company generates revenue from transactions where it provides a platform for the purchase and sale of digital advertising inventory. The Company uses automated systems to process and record revenue based on contractual terms with buyers and publishers, and its revenue is comprised of a significant volume of low-dollar transactions. We identified revenue as a critical audit matter because the Company’s systems to process and record revenue are highly automated and involve complex logic supporting the recognition of revenue. This required increased extent of effort, including the need for us to involve professionals with expertise in Information Technology (IT) to identify, test, and evaluate the Company’s systems, software applications, and automated controls. How the Critical Audit Matter Was Addressed in the Audit Our audit procedures related to the Company’s systems to process revenue transactions included the following, among others: • With the assistance of our IT specialists, we: 62 Table of Contents ◦ Identified the significant systems used to process revenue transactions and tested the general IT controls over each of these systems, including testing of user access controls, change management controls, and IT operations controls. ◦ Performed testing of system interface controls and automated controls within the relevant revenue streams, as well as controls designed to ensure the accuracy and completeness of revenue. ◦ Independently created test transactions and traced such transactions through the systems to final output for financial reporting. • We tested internal controls within the relevant revenue business processes, including those in place to reconcile the various systems to the Company’s general ledger. • We evaluated recorded revenue and revenue trends and used data analytics to analyze transactional revenue data. • We used technology-based data analysis tools to inspect journal entries to: ◦ Identify significant relationships in the revenue population. ◦ Sufficiently understand identified significant relationships and related accounts affecting revenue. • We performed audit procedures on those related accounts determined to have a significant relationship with revenue. Such procedures included: ◦ For a sample of accounts receivable balances, evaluating responses to confirmations sent to customers or other evidence such as cash receipts received after year end. ◦ For a sample of accounts payable – seller balances, performing detail transaction testing by agreeing the amounts recognized to source documents. ◦ For a sample of cash disbursements made after year end, evaluating whether the amounts were appropriately included in accounts payable – seller as of the balance sheet date. ◦ Analytical procedures on the accounts payable – seller balance by developing an independent expectation for the recorded balance based on a historical relationship with revenue. Income Taxes — Valuation Allowance Release– Refer to Notes 2 and 17 to the financial statements Critical Audit Matter Description The Company is subject to income taxes in the U.S. (federal and state) and numerous foreign jurisdictions. Deferred income tax assets and liabilities are determined based upon the net tax effects of the differences between the Company’s consolidated financial statement carrying amounts and the tax bases of assets and liabilities and are measured using the enacted tax rate expected to apply to taxable income in the years in which differences are expected to be reversed. A valuation allowance is used to reduce some or all of the deferred tax assets if, based upon the weight of available evidence, it is more likely than not that those deferred tax assets will not be realized. Future realization of deferred tax assets depends on the existence of sufficient taxable income of the appropriate character. Sources of taxable income include future reversals of deferred tax assets and liabilities, expected future taxable income, taxable income in prior carryback years if permitted under the tax law, and tax planning strategies. As of December 31, 2025, management concluded that it is more likely than not that sufficient taxable income will be generated in the future to realize the Company’s U.S. federal and the majority of the Company’s U.S. state net deferred income tax assets. We identified management’s determination that it is more likely than not that sufficient taxable income will be generated in the future to realize these deferred tax assets as a critical audit matter because of the significant judgments management makes related to determining whether it is appropriate to consider expected future taxable income as a source of taxable income. This required a high degree of auditor judgment and an increased extent of effort, including the need to involve our income tax specialists, when performing audit procedures to evaluate the reasonableness of management’s judgments. How the Critical Audit Matter Was Addressed in the Audit Our audit procedures related to the release of the valuation allowance included the following, among others: • We tested internal controls over management's determination of whether it is more likely than not that the deferred tax assets will be realized. • With the assistance of our income tax specialists, we evaluated the reasonableness of the methods, assumptions, and judgments used by management to determine whether a valuation allowance was necessary. • We evaluated management’s ability to accurately estimate future taxable income by comparing actual results to management’s historical estimates and evaluating whether there have been any changes that would affect management’s ability to continue accurately estimating taxable income. • We tested the reasonableness of management’s estimates of future taxable income by comparing the estimates to: 63 Table of Contents ◦ Internal budgets. ◦ Historical taxable income, as adjusted for nonrecurring items. ◦ Internal communications to management and the Board of Directors. ◦ Forecasted information included in Company press releases as well as in analyst and industry reports for the Company and certain of its peer companies. • We evaluated whether the estimates of future taxable income were consistent with evidence obtained in other areas of the audit. /s/ Deloitte & Touche LLP Los Angeles, California February 25, 2026 We have served as the Company's auditor since 2018. 64 Table of Contents MAGNITE, INC. CONSOLIDATED BALANCE SHEETS (In thousands, except par values) December 31, 2025 December 31, 2024 ASSETS Current assets: Cash and cash equivalents $ 553,362 $ 483,220 Accounts receivable, net 1,301,955 1,200,046 Prepaid expenses and other current assets 26,261 19,914 TOTAL CURRENT ASSETS 1,881,578 1,703,180 Property and equipment, net 108,546 68,730 Right-of-use lease assets 66,611 50,329 Internal use software development costs, net 28,799 26,625 Intangible assets, net 12,445 21,309 Goodwill 983,902 978,217 Other assets, non-current 82,494 6,378 TOTAL ASSETS $ 3,164,375 $ 2,854,768 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable and accrued expenses $ 1,607,664 $ 1,466,377 Lease liabilities, current 20,163 16,086 Debt, current, net of debt issuance costs 208,447 3,641 Other current liabilities 5,462 9,880 TOTAL CURRENT LIABILITIES 1,841,736 1,495,984 Debt, non-current, net of debt discount and issuance costs 347,665 550,104 Lease liabilities, non-current 50,085 38,983 Other liabilities, non-current 2,539 1,479 TOTAL LIABILITIES 2,242,025 2,086,550 Commitments and contingencies (Note 13) STOCKHOLDERS' EQUITY Preferred stock, $ 0.00001 par value, 10,000 shares authorized at December 31, 2025 and December 31, 2024; 0 shares issued and outstanding at December 31, 2025 and December 31, 2024 — — Common stock, $ 0.00001 par value; 500,000 shares authorized at December 31, 2025 and December 31, 2024; 142,964 and 141,427 shares issued and outstanding at December 31, 2025 and December 31, 2024, respectively 2 2 Additional paid-in capital 1,440,358 1,433,809 Accumulated other comprehensive loss ( 1,451 ) ( 4,421 ) Accumulated deficit ( 516,559 ) ( 661,172 ) TOTAL STOCKHOLDERS' EQUITY 922,350 768,218 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 3,164,375 $ 2,854,768 The accompanying notes to consolidated financial statements are an integral part of these statements. 65 Table of Contents MAGNITE, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share amounts) Year Ended December 31, 2025 December 31, 2024 December 31, 2023 Revenue $ 713,953 $ 668,170 $ 619,710 Expenses: Cost of revenue 266,619 258,838 409,906 Sales and marketing 171,668 166,142 173,982 Technology and development 84,712 95,243 94,318 General and administrative 93,191 96,860 89,048 Merger, acquisition, and restructuring costs 162 — 7,465 Total expenses 616,352 617,083 774,719 Income (loss) from operations 97,601 51,087 ( 155,009 ) Other (income) expense: Interest expense, net 18,923 27,032 32,369 Foreign exchange (gain) loss, net 6,972 ( 5,083 ) 1,953 (Gain) loss on extinguishment of debt 2,152 7,706 ( 26,480 ) Other income ( 1,073 ) ( 5,052 ) ( 5,304 ) Total other expense, net 26,974 24,603 2,538 Income (loss) before income taxes 70,627 26,484 ( 157,547 ) Provision (benefit) for income taxes ( 73,986 ) 3,698 1,637 Net income (loss) $ 144,613 $ 22,786 $ ( 159,184 ) Net income (loss) per share: Basic $ 1.01 $ 0.16 $ ( 1.17 ) Diluted $ 0.95 $ 0.16 $ ( 1.17 ) Weighted average shares used to compute net income (loss) per share: Basic 142,560 140,557 136,620 Diluted 153,770 146,810 136,620 The accompanying notes to consolidated financial statements are an integral part of these statements. 66 Table of Contents MAGNITE, INC. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (In thousands) Year Ended December 31, 2025 December 31, 2024 December 31, 2023 Net income (loss) $ 144,613 $ 22,786 $ ( 159,184 ) Other comprehensive income (loss): Foreign currency translation adjustments 2,970 ( 2,345 ) 1,075 Other comprehensive income (loss) 2,970 ( 2,345 ) 1,075 Comprehensive income (loss) $ 147,583 $ 20,441 $ ( 158,109 ) The accompanying notes to consolidated financial statements are an integral part of these statements. 67 Table of Contents MAGNITE, INC. CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (In thousands) Common Stock Additional Paid-In Capital Accumulated Other Comprehensive Income (Loss) Accumulated Deficit Treasury Stock Total Stockholders’ Equity Shares Amount Shares Amount Balance at December 31, 2022 134,006 $ 2 $ 1,319,221 $ ( 3,151 ) $ ( 524,774 ) — $ — $ 791,298 Exercise of common stock options 395 — 2,166 — — — — 2,166 Issuance of common stock related to employee stock purchase plan 438 — 3,513 — — — — 3,513 Issuance of common stock related to RSU and PSU vesting 4,777 — — — — — — — Shares withheld related to net share settlement ( 1,039 ) — ( 11,814 ) — — — — ( 11,814 ) Stock-based compensation — — 74,629 — — — — 74,629 Other comprehensive income — — — 1,075 — — — 1,075 Net loss — — — — ( 159,184 ) — — ( 159,184 ) Balance at December 31, 2023 138,577 2 1,387,715 ( 2,076 ) ( 683,958 ) — — 701,683 Exercise of common stock options 109 — 572 — — — — 572 Issuance of common stock related to employee stock purchase plan 463 — 3,589 — — — — 3,589 Issuance of common stock related to RSU vesting 5,433 — — — — — — — Shares withheld related to net share settlement ( 1,995 ) — ( 22,472 ) — — — — ( 22,472 ) Purchase of treasury stock — — — — — ( 1,160 ) ( 14,573 ) ( 14,573 ) Retirement of common stock ( 1,160 ) — ( 14,573 ) — — 1,160 14,573 — Stock-based compensation — — 78,978 — — — — 78,978 Other comprehensive loss — — — ( 2,345 ) — — — ( 2,345 ) Net income — — — — 22,786 — — 22,786 Balance at December 31, 2024 141,427 2 1,433,809 ( 4,421 ) ( 661,172 ) — — 768,218 Exercise of common stock options 526 — 3,063 — — — — 3,063 Issuance of common stock related to employee stock purchase plan 310 — 3,941 — — — — 3,941 Issuance of common stock related to RSU and PSU vesting 5,931 — — — — — — — Shares withheld related to net share settlement ( 1,860 ) — ( 32,924 ) — — — — ( 32,924 ) Purchase of treasury stock — — — — — ( 3,370 ) ( 46,282 ) ( 46,282 ) Retirement of common stock ( 3,370 ) — ( 46,282 ) — — 3,370 46,282 — Stock-based compensation — — 78,751 — — — — 78,751 Other comprehensive income — — — 2,970 — — — 2,970 Net income — — — — 144,613 — — 144,613 Balance at December 31, 2025 142,964 $ 2 $ 1,440,358 $ ( 1,451 ) $ ( 516,559 ) $ — $ — $ 922,350 The accompanying notes to consolidated financial statements are an integral part of these statements. 68 Table of Contents MAGNITE, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) Year Ended December 31, 2025 December 31, 2024 December 31, 2023 OPERATING ACTIVITIES: Net income (loss) $ 144,613 $ 22,786 $ ( 159,184 ) Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation and amortization 53,674 58,510 240,820 Stock-based compensation 76,648 76,519 72,617 (Gain) loss on extinguishment of debt 2,152 7,706 ( 26,480 ) Provision for doubtful accounts 1,145 587 4,666 Amortization of debt discount and issuance costs 3,642 4,119 6,279 Non-cash lease expense ( 1,478 ) ( 4,772 ) ( 1,712 ) Deferred income taxes ( 78,230 ) 95 ( 2,379 ) Unrealized foreign currency (gain) loss, net 5,563 ( 7,001 ) 1,266 Other items, net 124 23 3,007 Changes in operating assets and liabilities: Accounts receivable ( 103,761 ) ( 26,024 ) ( 220,102 ) Prepaid expenses and other assets ( 6,402 ) 1,980 1,004 Accounts payable and accrued expenses 142,603 97,380 294,677 Other liabilities ( 4,125 ) 3,293 ( 112 ) Net cash provided by operating activities 236,168 235,201 214,367 INVESTING ACTIVITIES: Purchases of property and equipment ( 70,535 ) ( 32,810 ) ( 26,764 ) Capitalized internal use software development costs ( 13,768 ) ( 14,260 ) ( 10,619 ) Mergers and acquisitions, net of indemnification claims holdback ( 8,100 ) — — Other investing activities ( 362 ) ( 432 ) — Net cash used in investing activities ( 92,765 ) ( 47,502 ) ( 37,383 ) FINANCING ACTIVITIES: Proceeds from the term loan facility refinancing and repricing activities, net of debt discount 92,622 413,463 — Repayment of the term loan facility from refinancing and repricing activities ( 92,622 ) ( 403,113 ) — Payment for debt issuance costs ( 159 ) ( 4,547 ) — Repayment of debt ( 2,723 ) ( 1,823 ) ( 3,600 ) Repurchase of Convertible Senior Notes — — ( 165,518 ) Proceeds from exercise of stock options 3,063 572 2,166 Proceeds from issuance of common stock under employee stock purchase plan 3,941 3,589 3,513 Taxes paid related to net share settlement ( 32,924 ) ( 22,472 ) ( 11,814 ) Purchase of treasury stock ( 46,282 ) ( 14,573 ) — Repayment of finance leases — — ( 276 ) Payment of indemnification claims holdback — — ( 2,313 ) Net cash used in financing activities ( 75,084 ) ( 28,904 ) ( 177,842 ) EFFECT OF EXCHANGE RATE CHANGES ON CASH, AND CASH EQUIVALENTS 1,823 ( 1,794 ) 575 CHANGE IN CASH AND CASH EQUIVALENTS 70,142 157,001 ( 283 ) CASH AND CASH EQUIVALENTS — Beginning of period 483,220 326,219 326,502 CASH AND CASH EQUIVALENTS — End of period $ 553,362 $ 483,220 $ 326,219 The accompanying notes to consolidated financial statements are an integral part of these statements. 69 Table of Contents MAGNITE, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS-(Continued) (In thousands) Year Ended December 31, 2025 December 31, 2024 December 31, 2023 SUPPLEMENTAL DISCLOSURES OF OTHER CASH FLOW INFORMATION: Cash paid for income taxes $ 3,760 $ 3,870 $ 5,357 Cash paid for interest $ 28,159 $ 36,863 $ 37,028 Capitalized assets financed by accounts payable and accrued expenses and other liabilities $ 438 $ 6,742 $ 1,690 Capitalized stock-based compensation $ 2,103 $ 2,459 $ 2,012 Operating lease right-of-use assets obtained in exchange for operating lease liabilities $ 37,606 $ 13,628 $ 4,017 Operating lease right-of-use assets reduction and corresponding non-cash adjustment to operating lease liabilities $ 2,178 $ 4,622 $ — Purchase consideration - indemnification claims holdback $ 2,000 $ — $ — Non-cash financing activity related to Amendment Nos. 1 and 2 to the 2024 Credit Agreement $ 270,555 $ 311,974 $ — The accompanying notes to consolidated financial statements are an integral part of these statements. 70 Table of Contents MAGNITE, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Note 1— Nature of Operations Company Overview Magnite, Inc. ("Magnite" or the "Company") was formed in Delaware and began operations on April 20, 2007. The Company's common stock is listed on the Nasdaq Global Select Market of The Nasdaq Stock Market LLC ("Nasdaq") under the symbol "MGNI." Magnite has its principal offices in New York City, Los Angeles, Denver, London, and Sydney, and additional offices in Europe, Asia, North America, and South America. The Company provides technology solutions to automate the purchase and sale of digital advertising inventory for buyers and sellers globally, across all channels, formats and auction types. The Company's platform features applications and services for sellers of digital advertising inventory, or publishers, that own and operate CTV channels, applications, websites, and other digital media properties, to manage and monetize their inventory; applications and services for buyers, including advertisers, agencies, agency trading desks, and demand side platforms, to buy digital advertising inventory; and a transparent, independent marketplace that brings buyers and sellers together and facilitates intelligent decision making and automated transaction execution at scale. The Company's clients include many of the world's leading buyers and sellers of digital advertising inventory. Sellers monetize their inventory through the Company’s platform by seamlessly connecting to a global market of integrated buyers that transact through real-time bidding. These transactions include biddable auctions, where multiple buyers bid against each other in a real-time auction for the right to purchase a publisher's inventory, as well as reserve auctions, where publishers establish direct deals or private marketplaces with select buyers. At the same time, buyers leverage the Company’s platform to reach their target audiences across thousands of sellers. Note 2— Organization and Summary of Significant Accounting Policies Basis of Consolidation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America, or GAAP, and include the operations of the Company and its wholly owned subsidiaries. All significant intercompany transactions and balances have been eliminated in consolidation. Segments Management has determined that the Company operates as one operating segment and one reportable segment. The Company’s chief operating decision maker ("CODM") is the Chief Executive Officer ("CEO"). The Company has one primary business activity, where it provides a platform to all of its customers, buyers and sellers, that automates the purchase and sale of digital advertising inventory globally, across all channels, formats, and auction types, as described above in Note 1—Nature of Operations. The Company’s CODM reviews financial information on a consolidated basis, principally to make decisions about how to allocate resources and to measure the Company’s performance. The CODM reviews consolidated net income (loss), which is the measure of financial profit and loss most closely aligned with generally accepted accounting principles. The CODM considers budget-to-actual variances for this measure, predominantly in the annual budget, forecasting process, and quarterly results assessment. The CODM does not review any balance sheet information at any other level than on a consolidated basis and does not review any income statement information at any other level than on a consolidated basis with the exception of revenue by geography and by channel (refer to Note 4 ) . The significant expense information regularly provided to the CODM is the same as that included in the face of the Company's consolidated income statement of operations. Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported and disclosed financial statements and accompanying footnotes. Actual results could differ materially from these estimates. On an ongoing basis, management evaluates its estimates, primarily those related to: (i) revenue recognition criteria, including the determination of revenue reporting as net versus gross in the Company’s revenue arrangements, (ii) accounts receivable and allowances for doubtful accounts, (iii) amounts capitalized and the useful lives of intangible assets, internal use software development costs, and property and equipment, (iv) valuation of long-lived assets and their recoverability, including goodwill, and (v) the realization of tax assets and estimates of tax liabilities. 71 Table of Contents These estimates are based on historical data and experience, as well as various other factors that management believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Estimates relating to the allowance for doubtful accounts, amounts capitalized and estimated useful lives of internal-use software development costs, estimated useful lives of long-lived assets, recoverability of intangible assets and goodwill, and income taxes, including the realization of tax assets and estimates of tax liabilities require the selection of appropriate valuation methodologies and models, and judgment in evaluating ranges of assumptions and financial inputs. Actual results may differ materially from those estimates under different assumptions or circumstances. In connection with the Company's periodic review of the estimated useful lives of its property and equipment, the Company extended the estimated useful lives of its network hardware assets from three years to five years effective January 1, 2024. The change in estimated useful lives were due to actual and expected longer refresh cycles for these assets. Based on the carrying value of network hardware assets as of December 31, 2023 and those placed in service during the year ended December 31, 2024, the effect of this change in estimate was an increase in income from operations of $ 12.6 million for the year ended December 31, 2024 and an increase in net income of $ 12.6 million, or $ 0.09 per basic and diluted share for the year ended December 31, 2024. The updated policy reflecting the change in estimated useful lives is below. Revenue Recognition The Company generates revenue from transactions where it provides a platform for the purchase and sale of digital advertising inventory. Generally, the Company's revenue is based on a percentage of the ad spend that runs through its platform, although for certain clients, services, or transaction types the Company may receive a fixed CPM for each impression sold, and for advertising campaigns that are transacted through insertion orders the Company earns revenue based on the full amount of ad spend that runs through its platform. In addition, the Company may receive certain fixed monthly fees for the use of its platform or products. The Company's platform dynamically connects sellers and buyers of advertising inventory in a digital marketplace. The Company's solution incorporates proprietary machine-learning algorithms, sophisticated data processing, high-volume storage, detailed analytics capabilities, and a distributed infrastructure. Digital advertising inventory is created when consumers access sellers’ content. Sellers provide digital advertising inventory to the Company's platform in the form of advertising requests, or ad requests. When the Company receives ad requests from sellers, it sends bid requests to buyers, which enable buyers to bid on sellers’ digital advertising inventory. Winning bids can create advertising, or paid impressions, for the seller to present to the consumer. The total volume of spending between buyers and sellers on the Company's platform is referred to as advertising spend. The Company keeps a percentage of that advertising spend as a fee, and remits the remainder to the seller. The fee that the Company retains from the gross advertising spend on its platform is recognized as revenue. The fee earned on each transaction is based on the pre-existing agreement between the Company and the seller and the clearing price of the winning bid. The Company recognizes revenue upon fulfillment of its performance obligation to a client, which occurs at the point in time an ad renders and is counted as a paid impression, subject to a contract existing with the client and a fixed or determinable transaction price. The Company does not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less and (ii) contracts for which the Company recognizes revenue at the amount to which it has the right to invoice for services performed. The Company considers the following when determining if a contract exists (i) contract approval by all parties, (ii) identification of each party’s rights regarding the goods or services to be transferred, (iii) specified payment terms, (iv) commercial substance of the contract, and (v) collectability of substantially all of the consideration is probable. The determination of whether revenue should be reported on a gross or net basis is based on an assessment of whether the Company is acting as the principal or an agent in the transaction. In determining whether the Company is acting as the principal or an agent, the Company follows the accounting guidance for principal-agent considerations. Making such determinations involves judgment and is based on an evaluation of the terms of each arrangement, none of which are considered presumptive or determinative. Expenses The Company classifies its expenses into the following categories: Cost of Revenue. The Company's cost of revenue primarily consists of cloud hosting, data center, and bandwidth costs, ad verification costs, depreciation and maintenance expense of hardware supporting the Company's revenue-producing platform, amortization of internally-developed software costs for the development of the Company's revenue-producing platform, amortization expense associated with acquired developed technologies, personnel costs, and software costs. In addition, for revenue booked on a gross basis, cost of revenue includes traffic acquisition costs. Personnel costs included in cost of revenue include salaries, bonuses, and stock-based compensation, and are primarily attributable to personnel in the Company's network operations 72 Table of Contents group who support the Company's platform. The Company capitalizes costs associated with software that is developed or obtained for internal use and amortize the costs associated with its revenue-producing platform in cost of revenue over their estimated useful lives. The Company amortizes acquired developed technologies over their estimated useful lives. Sales and Marketing. The Company's sales and marketing expenses primarily consist of personnel costs, including salaries, bonuses, and stock-based compensation, as well as marketing expenses such as brand marketing, travel expenses, trade shows and marketing materials, amortization expense associated with client relationships, and non-compete agreements from the Company's business acquisitions, professional services, facilities-related costs, and depreciation expense. The Company's sales and support organization focuses on increasing the adoption of the Company's solution by existing and new buyers and sellers and supports ongoing client relationships. The Company amortizes acquired intangibles associated with client relationships from its business acquisitions over their estimated useful lives. Technology and Development. The Company's technology and development expenses primarily consist of personnel costs, including salaries, bonuses, and stock-based compensation, as well as professional services associated with the ongoing development and maintenance of the Company's solution, software costs, facilities-related costs, and depreciation and amortization expense. These expenses include costs incurred in the development, implementation, and maintenance of internal use software, including platform and related infrastructure. Technology and development costs are expensed as incurred, except to the extent that such costs are associated with internal use software development that qualifies for capitalization, which are then recorded as internal use software development costs, net, on the Company's consolidated balance sheets. The Company amortizes internal use software development costs that relate to its revenue-producing activities on the Company's platform to cost of revenue and amortize other internal use software development costs to technology and development costs or general and administrative expenses, depending on the nature of the related project. The Company amortizes acquired intangibles associated with technology and development functions from its business acquisitions over their estimated useful lives. General and Administrative. The Company's general and administrative expenses primarily consist of personnel costs, including salaries, bonuses, and stock-based compensation, associated with the Company's executive, finance, legal, human resources, compliance, and other administrative personnel, as well as accounting and legal professional services fees, facilities-related costs, depreciation expense, bad debt expense, and other corporate-related expenses. Merger, Acquisition, and Restructuring Costs. The Company's merger, acquisition, and restructuring costs primarily consist of professional service fees associated with merger and acquisition activities, cash-based employee termination costs, related stock-based compensation charges, and other restructuring activities, including facility closures, relocation costs, contract termination costs, and impairment costs of abandoned technology associated with restructuring activities. Stock-Based Compensation Compensation expense related to employee and non-employee stock-based awards is measured and recognized in the consolidated financial statements based on the fair value of the awards granted. The Company grants awards to employees that vest based solely on continued service, or service conditions, awards that vest based on the achievement of performance targets, or performance conditions, and awards that vest based on the Company's stock price exceeding a peer index, or market conditions. The fair value of restricted stock units that vest based on continued service is equal to the closing price of the Company's common stock as reported on the Nasdaq on the grant date. The fair value of each option award containing service conditions is estimated on the grant date using the Black-Scholes option-pricing model. Generally, option awards have a contractual term of ten years . The fair value of awards containing market conditions is estimated using a Monte-Carlo simulation model. For service condition awards, stock-based compensation expense is recognized on a straight-line basis over the requisite service periods of the awards, which is generally four years . For performance condition and market condition awards, stock-based compensation expense is recognized using a graded vesting model over the requisite service period of the awards. For market condition awards, expense recognized is not subsequently reversed if the market conditions are not achieved. The Company accounts for forfeitures when they occur. The assumptions and estimates used in the Black-Scholes pricing model are as follows: Fair Value of Common Stock. The fair value of common stock is based on the closing price of the Company's common stock as reported on the Nasdaq on the grant date. Risk-Free Interest Rate. The Company bases the risk-free interest rate used in the Black-Scholes option-pricing model on the yields of U.S. Treasury securities with maturities appropriate for the term of stock option awards. Expected Term. For employee stock options the expected term is determined based on historical trends. The expected term of employee stock options that contain performance conditions represents the weighted-average period that the stock options are estimated to remain outstanding. 73 Table of Contents Volatility. The computation of the expected volatility assumption is based on the historical volatility of the Company’s common stock. Dividend Yield. The dividend yield assumption is based on the Company’s history and current expectations of dividend payouts. The Company has never declared or paid any cash dividends on its common stock and does not anticipate paying any cash dividends in the foreseeable future, so the Company used an expected dividend yield of zero . Determining the fair value of stock-based awards with performance and market conditions requires judgment. The Company's use of the Monte-Carlo simulation model requires the input of subjective assumptions, such as the expected term of the award, the expected volatility of the price of the Company’s common stock, risk-free interest rates, the expected dividend yield of the Company’s common stock, in addition for those awards containing market conditions, which also include expected volatilities of selected peer companies, and expected correlation coefficients of the Company and those of the selected peer companies. The assumptions used in the Company’s valuation model represent management’s best estimates. These estimates involve inherent uncertainties and the application of management’s judgment. If factors change and different assumptions are used, the Company’s stock-based compensation expense could be materially different in the future. Income Taxes Deferred income tax assets and liabilities are determined based upon the net tax effects of the differences between the Company’s consolidated financial statement carrying amounts and the tax basis of assets and liabilities and are measured using the enacted tax rate expected to apply to taxable income in the years in which the differences are expected to be reversed. A valuation allowance is recorded to reduce deferred tax assets when, based upon the weight of available evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The Company assesses the realizability of deferred tax assets on a jurisdictional basis and considers all available positive and negative evidence, including cumulative results of operations, projections of future taxable income, the reversal of taxable temporary differences, tax planning strategies, and the carryforward periods of existing tax attributes. The Company recognizes the income tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The income tax benefits recognized in the consolidated financial statements from such positions are then measured based on the largest benefit that has a greater than 50% likelihood of being realized. The Company recognizes interest and penalties accrued related to its uncertain tax positions in its income tax provision (benefit) in the consolidated statements of operations. Capital Stock The Company has authorized capital stock of 500,000,000 shares of common stock and 10,000,000 shares of preferred stock. The Company has issued common stock, which is included in outstanding common stock on the Company's consolidated balance sheets. From time to time, the Company has repurchased shares of common stock, which has been recorded as treasury stock on the Company's consolidated balance sheets. All treasury stock has been subsequently retired. The Company has not issued any shares of its preferred stock subsequent to the Company's initial public offering ("IPO") and does not have any preferred stock outstanding. The Company is required to reserve and keep available out of its authorized but unissued shares of common stock such number of shares sufficient to affect the conversion of all shares granted and available for grant under the Company’s stock award plans. The number of shares of the Company's stock reserved for these purposes at December 31, 2025 was 35,427,354 . The board of directors is authorized to establish, from time to time, the number of shares to be included in each series of preferred stock, and to fix the designation, powers, privileges, preferences, and relative participating, optional or other rights, if any, of the shares of each series of preferred stock, and any of its qualifications, limitations or restrictions. Net Income (Loss) Per Share Attributable to Common Stockholders Basic net income (loss) per share of common stock is calculated by dividing the net income (loss) by the weighted-average number of shares of common stock outstanding. Diluted income per share considers adjustments to net income and the weighted-average number of shares of common stock outstanding for the effect of potentially dilutive securities during the period. Potentially dilutive securities consist of stock options, restricted stock units, performance stock units, potential shares issuable under the Company's Employee Stock Purchase Plan ("ESPP"), and potential shares issuable as part of the Convertible Senior Notes. Diluted income per share is computed utilizing the treasury method for options, restricted stock units, performance stock units, and potential ESPP shares. Diluted income per share for the Convertible Senior Notes is calculated under the if-converted method. Potential common share equivalents are excluded where their inclusion would be anti-dilutive. For periods in which the Company reports net 74 Table of Contents loss, diluted net loss per share is the same as basic net loss per share because the effects of potentially dilutive securities would be anti-dilutive. Comprehensive Income (Loss) Comprehensive income (loss) encompasses all changes in equity other than those arising from transactions with stockholders, and consists of net income (loss), unrealized gains (losses) on investments and foreign currency translation adjustments. Cash and Cash Equivalents The Company invests excess cash primarily in money market funds, corporate debt securities, and highly liquid debt instruments of the U.S. government and its agencies. The Company classifies investments held in money market funds as cash equivalents because the money market funds have weighted-average maturities at the date of purchase of less than 90 days, are freely redeemable into cash and have a constant net asset value. Accounts Receivable Allowance for Doubtful Accounts Accounts receivable are recorded at the invoiced amount, are unsecured, and do not bear interest. The allowance for doubtful accounts is based on the best estimate of the amount of probable credit losses in existing accounts receivable. The allowance for doubtful accounts is determined based on historical collection experience and the review in each period of the status of the then-outstanding accounts receivable, while taking into consideration current client information, subsequent collection history and other relevant data. The Company reviews the allowance for doubtful accounts on a quarterly basis. Account balances are charged off against the allowance when the Company believes it is probable the receivable will not be recovered. Property and Equipment, Net Property and equipment are recorded at historical cost, less accumulated depreciation and amortization. Depreciation is computed using the straight-line method based upon the estimated useful lives of the assets. The estimated useful lives of the Company’s property and equipment are as follows: Years Computer equipment and network hardware 3 to 5 Furniture, fixtures and office equipment 5 to 7 Leasehold improvements Shorter of useful life or life of lease Purchased software 3 Repair and maintenance costs are charged to expense as incurred, while renewals and improvements are capitalized. When assets are retired or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is reflected in the Company’s results of operations. Internal Use Software Development Costs The Company capitalizes certain internal use software development costs associated with creating and enhancing internally developed software related to the Company’s technology infrastructure. These costs include personnel and related employee benefits expenses for employees who are directly associated with and who devote time to software projects, and external direct costs of materials and services consumed in developing or obtaining the software. Software development costs that do not meet the qualification for capitalization, as further discussed below, are expensed as incurred and recorded in technology and development expenses in the results of operations. Software development activities generally consist of three stages, (i) the planning stage, (ii) the application and infrastructure development stage, and (iii) the post implementation stage. Costs incurred in the planning and post implementation stages of software development, including costs associated with the post-configuration training and repairs and maintenance of the developed technologies, are expensed as incurred. The Company capitalizes costs associated with software developed for internal use when the planning stage is completed, management has authorized further funding for the completion of the project, and it is probable that the project will be completed and perform as intended. Costs incurred in the application and infrastructure development stages, including significant enhancements and upgrades, are capitalized. Capitalization ends once a project is substantially complete and the software and technologies are ready for their intended purpose. Internal use software development costs are amortized using a straight-line method over the estimated useful life, which is generally three years , commencing when the software is ready for its intended use. The straight-line recognition method approximates the manner in which the expected benefit 75 Table of Contents will be derived. On an ongoing basis, the Company assesses the remaining estimated useful lives of internal use software projects. If remaining useful lives are revised, the change is accounted for as a change in estimate. The Company does not transfer ownership of its software, or lease its software, to third parties. Intangible Assets Intangible assets primarily consist of acquired developed technology, client relationships, and in-process research and development projects resulting from business combinations, which are recorded at acquisition-date fair value, less accumulated amortization. The Company determines the appropriate useful life of its intangible assets by performing an analysis of expected cash flows of the acquired assets. Intangible assets are amortized over their estimated useful lives using a straight-line method, which approximates the pattern in which the economic benefits are consumed. The Company’s intangible assets are being amortized over their estimated useful lives as follows: Years Developed technology 3 to 5 In-process research and development 3 to 5 Customer relationships 0.5 to 4 Non-compete agreements 2 to 3 Other intangible assets 3 to 10 On an ongoing basis, the Company assesses the remaining estimated useful lives of intangible assets. If remaining useful lives are revised, the change is accounted for as a change in estimate. Intangible assets are reviewed for impairment indicators at least annually and whenever events or changes in circumstances indicate that the carrying amount of the assets might not be recoverable. Conditions that would necessitate an impairment assessment include a significant decline in the observable market value of an asset, a significant change in the extent or manner in which an asset is used, or any other significant adverse change that would indicate that the carrying amount of an asset or group of assets may not be recoverable. For intangible assets used in operations, impairment losses are only recorded if the asset’s carrying amount is not recoverable through its undiscounted, probability-weighted future cash flows at the asset group level that represents the lowest level of independent cash flows. The Company measures the impairment loss based on the difference between the carrying amount and estimated fair value. Impairment of Long-Lived Assets including Internal Use Capitalized Software Costs The Company assesses the recoverability of its long-lived assets when events or changes in circumstances indicate their carrying value may not be recoverable. Such events or changes in circumstances may include: a significant adverse change in the extent or manner in which a long-lived asset is being used, significant adverse change in legal factors or in the business climate that could affect the value of a long-lived asset, an accumulation of costs significantly in excess of the amount originally expected for the acquisition or development of a long-lived asset, current or future operating or cash flow losses that demonstrate continuing losses associated with the use of a long-lived asset, or a current expectation that, more likely than not, a long-lived asset will be sold or otherwise disposed of significantly before the end of its previously estimated useful life. The Company performs impairment testing at the asset group level that represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. The Company assesses recoverability of a long-lived asset by determining whether the carrying value of the asset group can be recovered through projected undiscounted cash flows over their remaining lives. If the carrying value of the asset group exceeds the forecasted undiscounted cash flows, an impairment loss is recognized, measured as the amount by which the carrying amount exceeds estimated fair value. An impairment loss is charged to operations in the period in which management determines such impairment. Business Combinations The results of businesses acquired in a business combination are included in the Company’s consolidated financial statements from the date of acquisition. The Company allocates the purchase price of a business combination, which is the sum of the consideration provided, which may consist of cash, equity or a combination of the two, to the identifiable assets and liabilities of the acquired business at their acquisition date fair values. The excess of the purchase price over the amount allocated to the identifiable assets and liabilities, if any, is recorded as goodwill. Determining the fair value of assets acquired and liabilities assumed requires management to use significant judgment and estimates including the selection of valuation methodologies, estimates of future revenues and cash flows, discount rates and selection of comparable companies. 76 Table of Contents When the Company issues stock-based or cash awards to an acquired company’s stockholders, the Company evaluates whether the awards are contingent consideration or compensation for post-business combination services. The evaluation includes, among other things, whether the vesting of the awards is contingent on the continued employment of the selling stockholder beyond the acquisition date. If continued employment is required for vesting, the awards are treated as compensation for post-acquisition services and recognized as expense over the requisite service period. The Company estimates the fair value of intangible assets acquired generally using a discounted cash flow approach, which includes an analysis of the future cash flows expected to be generated by the asset and the risk associated with achieving these cash flows. The key assumptions used in the discounted cash flow model include the discount rate that is applied to the forecasted future cash flows to calculate the present value of those cash flows and the estimate of future cash flows attributable to the acquired intangible asset, which include revenue, expenses and taxes. The carrying value of acquired working capital assets and liabilities approximates its fair value, given the short-term nature of these assets and liabilities. Acquisition-related transaction costs are not included as a component of consideration transferred, but are accounted for as an expense in the period in which the costs are incurred. Goodwill Goodwill represents the excess of the aggregate fair value of the consideration transferred in a business combination over the fair value of the assets acquired, net of liabilities assumed. Goodwill is not amortized, but is subject to impairment testing conducted annually during the fourth quarter or more frequently if events or changes in circumstances indicate that goodwill may be impaired. In accordance with guidance related to impairment testing, the Company has the option to first assess qualitative factors to determine whether or not it is necessary to perform the quantitative goodwill impairment test. If the qualitative assessment option is not elected, or if the qualitative assessment indicates that it is more likely than not that the fair value is less than its carrying amount, a quantitative analysis is then performed. The quantitative analysis, if performed, compares the estimated fair value of the Company with its respective carrying amount, including goodwill. If the estimated fair value of the Company exceeds its carrying amount, including goodwill, goodwill is considered not to be impaired and no additional steps are necessary. If the fair value is less than the carrying amount, including goodwill, then an impairment adjustment must be recorded up to the carrying amount of goodwill. The Company operates as a single operating segment and has identified a single reporting unit. Operating Leases The Company determines if an arrangement is a lease at inception. A contract is or contains a lease if it conveys the right to control the use of an identified asset for a period of time in exchange for consideration. The Company's classes of assets that are leased include office facilities, data centers, and equipment. The Company has elected not to recognize short-term leases on the balance sheet, nor separate lease and non-lease components for data center leases. In addition, the Company utilized the portfolio approach to group leases with similar characteristics together. For identified leases, the Company used its incremental borrowing rate to discount the related future payment obligations, which represents the rate of interest the Company would have to pay to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment. The Company records rent expense for operating leases, including leases of office facilities, data centers, and equipment, on a straight-line basis over the lease term. The straight-line calculation of rent expense includes rent escalations on certain leases, as well as lease incentives provided by the landlords, including payments for leasehold improvements and rent-free periods. The Company begins recognition of rent expense on the commencement date, which is generally the date that the asset is made available for use. The Company also records variable lease expense primarily related to operating expenses, utilities, or other costs that are subject to fluctuation. Lease liability, which represents the present value of the Company's obligation related to the estimated future lease payments, is included in lease liabilities, current and lease liabilities, non-current within the consolidated balance sheets. These liability balances are reduced as lease related payments are made. For operating leases, the right-of-use ("ROU") assets are amortized on a periodic basis over the expected term of the lease (see Note 11). Fair Value of Financial Instruments The carrying amounts of the Company's cash equivalents, accounts receivable, accounts payable, accrued expenses, and seller payables approximate fair value due to the short-term nature of these instruments. Certain assets of the Company are recorded at their fair value, using the fair value hierarchy, on a recurring basis, and other assets and liabilities, including goodwill and 77 Table of Contents intangible assets are subject to measurement at fair value on a non-recurring basis if they are deemed to be impaired as a result of an impairment review (see Note 5). Concentration of Risk Financial instruments that potentially subject the Company to concentration of credit risk consist principally of cash, cash equivalents, and accounts receivable. Cash maintained with financial institutions typically exceeds applicable federally insured limits in the U.S. and may not be covered by similar local depositor insurance schemes for cash held in foreign currencies or in bank accounts outside of the U.S. Cash equivalents, primarily money market fund investments, are not insured by federal insurance schemes and are exposed to other potential risks linked to high concentration among major custodial banks. Accounts receivable include amounts due from buyers with principal operations primarily in the United States. The Company performs ongoing credit evaluations of its buyers. At December 31, 2025, two buyers accounted for 40 % and 12 %, respectively, of consolidated accounts receivable, net. At December 31, 2024, two buyers accounted for 46 % and 11 %, respectively, of accounts receivable, net. The Company recognizes revenue from its contracts with sellers. No seller of advertising inventory accounted for 10% or more of revenue during the years ended December 31, 2025, 2024, and 2023. At December 31, 2025, one seller of advertising inventory accounted for 27 % of accounts payable and accrued expenses and at December 31, 2024, one seller of advertising inventory accounted for 28 % of accounts payable and accrued expenses. Foreign Currency Transactions and Translation Transactions in foreign currencies are translated into the functional currency of the applicable entity at the rates of exchange in effect at the date of the transaction. Foreign exchange gains or losses are included in foreign exchange (gain) loss, net in the accompanying consolidated statements of operations. To the extent that the functional currency is different from the U.S. Dollar, the financial statements have then been translated into U.S. Dollars using period-end exchange rates for assets and liabilities and average exchange rates for the results of operations. Foreign currency translation gains and losses are included as a component of accumulated other comprehensive income (loss) on the consolidated balance sheets. Recently Adopted Accounting Standards In December 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standard Update ("ASU") 2023-09, Income Taxes (Topic 740) – Improvements to Income Tax Disclosures ("ASU 2023-09") to enhance income tax information primarily through changes in the rate reconciliation and income taxes paid information. ASU 2023-09 is effective for annual periods beginning after December 15, 2024 on a prospective basis. Early adoption and retrospective application are permitted. The Company adopted the standard for the fiscal year ended December 31, 2025 on a prospective basis. See Note 17 for the required disclosures. Recent Accounting Pronouncements Not Yet Adopted In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40) - Disaggregation of Income Statement Expenses ("ASU 2024-03"). ASU 2024-03 requires additional disclosures of the nature of expenses included in the income statement and presented in the footnotes. ASU 2024-03 is effective for annual periods beginning after December 15, 2026 and for interim periods beginning after December 15, 2027 on a prospective basis. Early adoption and retrospective application are permitted. The Company is currently evaluating the impact of adopting ASU 2024-03 on its disclosures. In July 2025, the FASB issued ASU 2025-05, Financial Instruments - Credit Losses (Topic 326) - Measurement of Credit Losses for Accounts Receivable and Contract Assets ("ASU 2025-05"), which provides a practical expedient to measure credit losses on current accounts receivable and current contract assets. The practical expedient allows companies to assume that current conditions as of the balance sheet date do not change for the remaining life of the asset when measuring credit losses. ASU 2025-05 is effective for annual periods beginning after December 15, 2025 and for interim periods within those annual reporting periods on a prospective basis. Early adoption is permitted. The Company will adopt ASU 2025-05 on January 1, 2026 and does not expect the standard to have a material impact on its financial statements and disclosures. In September 2025, the FASB issued ASU 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40) - Targeted Improvements to the Accounting for Internal-Use Software ("ASU 2025-06"), which modernizes and simplifies the recognition and disclosure framework for internal-use software costs by changing from a project-stage approach to a more judgment-based approach. ASU 2025-06 is effective for annual periods beginning after December 15, 2027 and for interim periods within those annual reporting periods on a prospective basis. Early adoption is permitted. The Company is currently evaluating the 78 Table of Contents impact of adopting ASU 2025-06 on its financial statements and disclosures. The Company does not believe there are any other recently issued and effective or not yet effective pronouncements that would have or are expected to have a material impact on the Company’s present or future consolidated financial statements. Note 3— Net Income (Loss) Per Share The following table presents the basic and diluted net income (loss) per share: Year Ended December 31, 2025 December 31, 2024 December 31, 2023 (in thousands, except per share amounts) Basic Net Income (Loss) Per Share: Net income (loss) $ 144,613 $ 22,786 $ ( 159,184 ) Weighted-average common shares outstanding used to compute basic net income (loss) per share 142,560 140,557 136,620 Basic net income (loss) per share $ 1.01 $ 0.16 $ ( 1.17 ) Diluted Net Income (Loss) Per Share: Net income (loss) $ 144,613 $ 22,786 $ ( 159,184 ) Add back: Interest expense, Convertible Notes, net of tax $ 1,260 $ — $ — Net income (loss) used to calculate diluted income (loss) per share $ 145,873 $ 22,786 $ ( 159,184 ) Denominator: Weighted-average common shares used to compute basic net income (loss) per share 142,560 140,557 136,620 Dilutive effect of weighted-average restricted stock units 4,627 3,731 — Dilutive effect of weighted-average common stock options 2,096 1,811 — Dilutive effect of weighted-average performance stock units 1,241 669 — Dilutive effect of weighted-average ESPP shares 36 42 — Dilutive effect of weighted-average Convertible Notes 3,210 — — Weighted-average shares used to compute diluted net income (loss) per share 153,770 146,810 136,620 Diluted net income (loss) per share $ 0.95 $ 0.16 $ ( 1.17 ) The following weighted-average shares have been excluded from the calculation of diluted net income (loss) per share attributable to common stockholders for each period presented because they were anti-dilutive: Year Ended December 31, 2025 December 31, 2024 December 31, 2023 (in thousands) Unvested restricted stock units — — 1,608 Options to purchase common stock — — 1,566 Unvested performance stock units — — 84 ESPP shares — — 31 Convertible Senior Notes — 3,210 4,981 Total shares excluded from diluted net income (loss) per share — 3,210 8,270 As of December 31, 2025, the performance stock units granted during 2021, 2024, and 2025 had expected achievement levels of 0 %, 150 %, and 80 %, respectively. The performance stock units granted during 2022 vested on February 1, 2025 with an actual achievement of approximately 125 %. The performance stock units granted during 2023 had an actual achievement level of approximately 126 % as of December 31, 2025. As of December 31, 2024, the performance stock units granted during 2021, 2022, 2023, and 2024 had expected achievement levels of 0 %, 121 %, 137 %, and 150 %, respectively. As of December 31, 2023, the performance stock units granted during 2021, 2022, and 2023 had expected achievement levels of 0 %, 58 %, and 46 %, respectively. 79 Table of Contents These expected and actual achievement levels are included in the calculation of weighted-average shares in the tables above. Refer to Note 16 for additional information related to performance stock units. For the year ended December 31, 2025, the shares issuable assuming conversion of the Convertible Senior Notes (as defined in Note 12) were included in the calculation of diluted net income per share because they were dilutive. For the years ended December 31, 2024 and 2023, the shares issuable assuming conversion were excluded from the calculation of diluted net income (loss) per share because they were anti-dilutive. The Convertible Senior Notes have an initial conversion rate of 15.6539 shares of common stock per $1,000 principal amount of the Convertible Senior Notes, which will be subject to anti-dilution adjustments in certain circumstances. Note 4— Revenue For the majority of transactions on the Company's platform, the Company reports revenue on a net basis as it does not act as the principal in the purchase and sale of digital advertising inventory because it does not have control of the digital advertising inventory and does not set prices agreed upon within the auction marketplace. For certain advertising campaigns that are transacted through insertion orders, the Company reports revenue on a gross basis, based primarily on its determination that the Company acts as the primary obligor in the delivery of advertising campaigns for buyers with respect to such transactions. The following table presents the Company's revenue recognized on a net basis and on a gross basis for the years ended December 31, 2025, 2024, and 2023: Year Ended December 31, 2025 December 31, 2024 December 31, 2023 (in thousands, except percentages) Revenue: Net basis $ 640,663 90 % $ 572,003 86 % $ 508,478 82 % Gross basis 73,290 10 96,167 14 111,232 18 Total $ 713,953 100 % $ 668,170 100 % $ 619,710 100 % The following table presents the Company's revenue by channel for the years ended December 31, 2025, 2024, 2023: Year Ended December 31, 2025 December 31, 2024 December 31, 2023 (in thousands, except percentages) Channel: CTV $ 346,099 48 % $ 317,413 48 % $ 282,126 46 % Mobile 260,733 37 244,643 36 232,495 37 Desktop 107,121 15 106,114 16 105,089 17 Total $ 713,953 100 % $ 668,170 100 % $ 619,710 100 % The following table presents the Company's revenue disaggregated by geographic location, based on the location of the Company's sellers for the years ended December 31, 2025, 2024, 2023: Year Ended December 31, 2025 December 31, 2024 December 31, 2023 (in thousands, except percentages) United States $ 537,733 75 % $ 498,440 75 % $ 462,167 75 % International 176,220 25 169,730 25 157,543 25 Total $ 713,953 100 % $ 668,170 100 % $ 619,710 100 % 80 Table of Contents Payment terms are specified in agreements between the Company and the buyers and sellers on its platform. The Company generally bills buyers at the end of each month for the full purchase price of impressions filled in that month. The Company recognizes volume discounts as a reduction of revenue as they are incurred. Specific payment terms may vary by agreement, but are generally seventy-five days or less. The Company's accounts receivable are recorded at the amount of gross billings to buyers, net of allowances for the amounts the Company is responsible to collect. The Company's accounts payable related to amounts due to sellers are recorded at the net amount payable to sellers (refer to Note 10). Accordingly, both accounts receivable and accounts payable appear large in relation to revenue reported on a net basis. Accounts receivable are recorded at the invoiced amount, are unsecured, and do not bear interest. The allowance for doubtful accounts is reviewed quarterly, requires judgment, and is based on the best estimate of the amount of expected credit losses in existing accounts receivable. The Company reviews the status of the then-outstanding accounts receivable on a customer-by-customer basis, taking into consideration the aging schedule of receivables, its historical collection experience, current information regarding the client, subsequent collection history, and other relevant data, in establishing the allowance for doubtful accounts. Accounts receivable are presented net of an allowance for doubtful accounts of $ 4.0 million at December 31, 2025, and $ 2.9 million at December 31, 2024. Accounts receivable are written off against the allowance for doubtful accounts when the Company determines amounts are no longer collectible. The Company reviews the associated payable to sellers for recovery of buyer receivable allowance and write-offs; in some cases, the Company can reduce the payable to sellers. The reduction of seller payables related to recovery of uncollected buyer receivables is netted against allowance expense. The contra seller payables related to recoveries were $ 2.2 million and $ 1.9 million as of December 31, 2025 and December 31, 2024, respectively. The following is a summary of activity in the allowance for doubtful accounts for the years ended December 31, 2025, 2024, and 2023, respectively: Year Ended December 31, 2025 December 31, 2024 December 31, 2023 (in thousands) Allowance for doubtful accounts, beginning balance $ 2,902 $ 20,363 $ 1,092 Write-offs ( 1,327 ) ( 18,954 ) ( 856 ) Increase (decrease) in provision for expected credit losses 2,438 1,428 20,115 Recoveries of previous write-offs — 65 12 Allowance for doubtful accounts, December 31 $ 4,013 $ 2,902 $ 20,363 During the year ended December 31, 2024, the Company wrote off $ 19.0 million of allowance for doubtful accounts, of which $ 18.5 million was attributable to the outstanding accounts receivable from a buyer that filed for bankruptcy during 2023. The change in provision for expected credit losses associated with accounts receivable and the offsetting impact of the change to contra seller payables related to recoveries of uncollected buyer receivables result in the amount of bad debt expense or recoveries the Company recognizes each year. During the year ended December 31, 2025, the increase in the provision for expected credit losses associated with accounts receivable of $ 2.4 million was partially offset by increases of contra seller payables related to recoveries of uncollected buyer receivables of $ 1.3 million, which resulted in $ 1.1 million of bad debt expense. During the year ended December 31, 2024, the increase in the provision for expected credit losses associated with accounts receivable of $ 1.4 million was partially offset by increases of contra seller payables related to recoveries of uncollected buyer receivables, which resulted in an immaterial amount of bad debt expense. During the year ended December 31, 2023, the increase in the provision for expected credit losses associated with accounts receivable of $ 20.1 million was offset by increases of contra seller payables related to recoveries of uncollected buyer receivables of $ 15.4 million, which resulted in $ 4.7 million of bad debt expense. The increase in the provision for expected credit losses was primarily attributed to one buyer filing for bankruptcy, resulting in $ 4.2 million of bad debt expense during the year ended December 31, 2023. 81 Table of Contents Note 5— Fair Value Measurements Recurring Fair Value Measurements Fair value represents the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. Observable inputs are based on market data obtained from independent sources. The fair value hierarchy is based on the following three levels of inputs, of which the first two are considered observable and the last one is considered unobservable: • Level 1 – Quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. • Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. • Level 3 – Unobservable inputs. The table below sets forth a summary of financial instruments that are measured at fair value on a recurring basis at December 31, 2025: Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) (in thousands) Cash equivalents $ 342,771 $ 342,771 $ — $ — The table below sets forth a summary of financial instruments that are measured at fair value on a recurring basis at December 31, 2024: Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) (in thousands) Cash equivalents $ 436,731 $ 436,731 $ — $ — At December 31, 2025 and 2024, cash equivalents of $ 342.8 million and $ 436.7 million, respectively, consisted of money market funds, with original maturities of three months or less. The carrying amounts of cash equivalents are classified as Level 1 or Level 2 depending on whether or not their fair values are based on quoted market prices for identical securities that are traded in an active market. At December 31, 2025 and 2024, the Company had debt outstanding under its Convertible Senior Notes and loans under its 2024 Term Loan B Facility (as defined in Note 12) included in its balance sheets. The estimated fair value of the Company's Convertible Senior Notes was $ 199.2 million and $ 190.2 million, as of December 31, 2025 and 2024, respectively. The estimated fair value of Convertible Senior Notes is based on market rates and the closing trading price of the Convertible Senior Notes as of December 31, 2025 and 2024 and is classified as Level 2 in the fair value hierarchy. At December 31, 2025 and 2024, the estimated fair value of the Company's 2024 Term Loan B Facility was $ 360.0 million and $ 368.2 million, respectively. The estimated fair value is based on borrowing rates currently available to the Company for financing with similar terms and is classified as Level 2 in the fair value hierarchy. 82 Table of Contents Note 6— Property and Equipment Major classes of property and equipment were as follows: December 31, 2025 December 31, 2024 (in thousands) Computer equipment and network hardware $ 227,762 $ 184,155 Furniture, fixtures and office equipment 2,639 3,486 Leasehold improvements 1,117 2,576 Purchased software 1,108 1,123 Gross property and equipment 232,626 191,340 Accumulated depreciation ( 124,080 ) ( 122,610 ) Property and equipment, net $ 108,546 $ 68,730 Depreciation expense related to property and equipment totaled $ 24.8 million, $ 16.4 million, and $ 24.0 million for the years ended December 31, 2025, 2024, and 2023, respectively. The Company's property and equipment, net by geographical region was as follows: December 31, 2025 December 31, 2024 (in thousands) United States $ 95,035 $ 51,708 International 13,511 17,022 Total $ 108,546 $ 68,730 Note 7— Internal Use Software Development Costs Internal use software development costs were as follows: December 31, 2025 December 31, 2024 (in thousands) Internal use software development costs, gross 112,687 $ 97,571 Accumulated amortization ( 83,888 ) ( 70,946 ) Internal use software development costs, net $ 28,799 $ 26,625 During the years ended December 31, 2025, 2024, and 2023, the Company capitalized $ 15.9 million, $ 16.7 million, and $ 12.6 million, respectively, of internal use software development costs. Amortization expense was $ 13.7 million, $ 12.0 million, and $ 14.3 million for the years ended December 31, 2025, 2024, and 2023, respectively. Based on the Company’s internal use software development costs at December 31, 2025, excluding projects that are not ready for their intended use with a value of $ 8.8 million, estimated amortization expense of $ 10.9 million, $ 6.7 million, and $ 2.3 million is expected to be recognized in 2026, 2027, and 2028, respectively. Note 8— Business Combinations 2025 Acquisition—Streamrai, Inc. In September 2025, the Company completed the acquisition of the business of Streamrai, Inc. ("Streamr.ai" and such acquisition the "Streamr.ai Acquisition"), a platform that specializes in artificial intelligence tools that make CTV advertising accessible to small and medium-sized businesses ("SMBs"). The total purchase consideration was $ 10.1 million, of which $ 8.1 million was paid in cash and $ 2.0 million was held back to cover possible indemnification claims that will be partially released one year after the acquisition, with the remainder released by March 2027. In accordance with the accounting for business combinations, the Company recorded the acquisition based on the fair value of the consideration transferred and then allocated the purchase price to the identifiable assets acquired and liabilities assumed based on their respective fair values as of the acquisition date. The excess of the value of consideration transferred over the aggregate fair value of those net assets was recorded as goodwill. The allocation of purchase consideration resulted in an estimated $ 5.0 million of developed technology intangible assets with an estimated useful life 83 Table of Contents of 3 years, $ 0.7 million of non-compete intangible assets with an estimated useful life of 2 to 3 years, $ 0.1 million of customer relationships with an estimated useful life of 0.5 years, $ 0.2 million of trademark and trade name intangible assets with an estimated useful life of 3 years, goodwill of $ 5.7 million, which is attributable to the workforce of Streamr.ai and revenue synergies from the acquisition, and deferred tax liability of $ 1.5 million. The purchase price allocation is preliminary and subject to change pending finalization of any contingent matters. For tax purposes, the acquisition of Streamr.ai will be treated as a stock acquisition. The goodwill recognized in the acquisition of Streamr.ai is not tax deductible for tax purposes. Note 9— Intangible Assets and Goodwill The Company’s intangible assets as of December 31, 2025 and 2024 included the following: December 31, 2025 December 31, 2024 (in thousands) Amortizable intangible assets: Developed technology $ 112,250 $ 109,736 Customer relationships 60 37,300 In-process research and development 8,830 8,830 Other intangible assets 1,844 1,332 Non-compete agreements 690 — Total identifiable intangible assets, gross 123,674 157,198 Accumulated amortization—intangible assets: Developed technology ( 101,880 ) ( 93,941 ) Customer relationships ( 38 ) ( 34,192 ) In-process research and development ( 8,273 ) ( 6,856 ) Other intangible assets ( 954 ) ( 900 ) Non-compete agreements ( 84 ) — Total accumulated amortization—intangible assets ( 111,229 ) ( 135,889 ) Total identifiable intangible assets, net $ 12,445 $ 21,309 Amortization of intangible assets for the years ended December 31, 2025, 2024, and 2023 was $ 15.1 million, $ 30.1 million, and $ 202.5 million, respectively. For the year ended December 31, 2025, the Company wrote off fully amortized intangible assets with a historical cost of $ 39.8 million. The estimated remaining amortization expense associated with the Company's intangible assets was as follows as of December 31, 2025: Fiscal Year Amount (in thousands) 2026 $ 8,095 2027 2,466 2028 1,367 2029 79 2030 79 Thereafter 359 Total $ 12,445 84 Table of Contents Changes to the Company's goodwill were as follows (in thousands): Total Ending balance at December 31, 2023 $ 978,217 Ending balance at December 31, 2024 978,217 Additions for the Streamr.ai Acquisition 5,685 Ending balance at December 31, 2025 $ 983,902 The Company's qualitative assessment for impairment in the fourth quarter of 2025 did not indicate that it is more likely than not that the fair value of its goodwill is less than the aggregate carrying amount. Note 10— Accounts Payable and Accrued Expenses Accounts payable and accrued expenses included the following: December 31, 2025 December 31, 2024 (in thousands) Accounts payable—seller $ 1,572,103 $ 1,417,780 Accounts payable—trade 15,037 30,899 Accrued employee-related payables 19,524 17,698 Accrued holdback - indemnification claims 1,000 — Total $ 1,607,664 $ 1,466,377 Note 11— Leases The Company has operating leases for office facilities and data centers. The lease terms of the Company’s operating leases generally range from 1.0 year to 10.0 years. The Company's lease terms include periods under options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. The weighted average remaining lease term of leases included in lease liabilities is 4.2 years and 4.6 years as of December 31, 2025 and December 31, 2024, respectively. As of December 31, 2025 and December 31, 2024, a weighted average discount rate of 6.03 % and 6.12 %, respectively, has been applied to the remaining lease payments to calculate the lease liabilities included within the consolidated balance sheets. Operating lease expense was $ 22.9 million, $ 21.2 million and $ 24.5 million for the years ended December 31, 2025, 2024 and 2023, respectively. Included in operating lease expense for the year ended December 31, 2024 was a gain of $ 1.8 million related to the early termination of an office facility lease. The Company recognized variable lease expense of $ 4.4 million, $ 1.6 million, and $ 3.8 million for the years ended December 31, 2025, 2024 and 2023, respectively. For the year ended December 31, 2024, variable lease expense included $ 1.4 million of negative variable lease expense related to rent concessions for an office lease. The maturity of the Company's lease liabilities associated with leases included in the lease liabilities and ROU assets were as follows as of December 31, 2025 (in thousands): Fiscal Year 2026 $ 23,385 2027 18,216 2028 13,891 2029 13,835 2030 6,222 Thereafter 3,718 Total lease payments (undiscounted) 79,267 Less: imputed interest ( 9,019 ) Lease liabilities—total (discounted) $ 70,248 85 Table of Contents Cash paid for amounts included in lease liabilities was $ 23.0 million, $ 24.1 million, and $ 26.6 million for the years ended December 31, 2025, 2024, and 2023, respectively. The Company also received rental income of $ 1.1 million, $ 5.0 million, and $ 5.3 million for real estate leases for which it subleased the property to a third party during the years ended December 31, 2025, 2024, and 2023, respectively. Rental income is included in other income in the consolidated statements of operations. In addition to the lease liabilities included in these consolidated financial statements, the Company entered into agreements for office space and data centers that had not commenced as of December 31, 2025; therefore, the leases were not included in the lease liabilities and ROU assets balance as of December 31, 2025. The Company has future commitments totaling $ 46.3 million over a weighted average term of 7.3 years related to these agreements, of which $ 32.8 million relate to one lease that will commence in 2030 over 8.2 years. The Company's operating lease right-of-use assets by geographical region were as follows: December 31, 2025 December 31, 2024 (in thousands) United States $ 59,634 $ 45,178 International 6,977 5,151 Total $ 66,611 $ 50,329 Note 12— Debt Current and long term debt as of December 31, 2025 and 2024 consisted of the following: December 31, 2025 December 31, 2024 (in thousands) Convertible Senior Notes $ 205,067 $ 205,067 Less: Unamortized debt issuance costs ( 252 ) ( 1,424 ) Net carrying value of Convertible Senior Notes 204,815 203,643 2024 Term Loan B Facility 360,454 363,177 Less: Unamortized debt discount and issuance costs ( 9,157 ) ( 13,075 ) Net carrying value of 2024 Term Loan B Facility 351,297 350,102 Balance Sheet Presentation: Debt, current, net of debt issuance costs 208,447 3,641 Debt, non-current, net of debt discount and issuance costs 347,665 550,104 Total debt $ 556,112 $ 553,745 Maturities of the principal amount of the Company's debt were as follows as of December 31, 2025 (in thousands): Fiscal Year 2026 $ 208,699 2027 3,632 2028 3,632 2029 3,632 2030 3,632 Thereafter 342,294 Total $ 565,521 86 Table of Contents Amortization of debt discount and debt issuance costs is computed using the effective interest method and is included in interest expense in the consolidated statement of operations. Amortization of the debt discount and debt issuance costs associated with the Company's indebtedness totaled $ 3.1 million, $ 3.6 million, and $ 5.8 million for the years ended December 31, 2025, 2024, and 2023, respectively. Convertible Senior Notes and Capped Call Transactions In March 2021, the Company issued $ 400.0 million aggregate principal amount of 0.25 % convertible senior notes in a private placement, including $ 50.0 million aggregate principal amount of such notes pursuant to the exercise in full of the over-allotment options of the initial purchasers (collectively, the "Convertible Senior Notes"). The Convertible Senior Notes will mature on March 15, 2026, unless earlier repurchased, redeemed or converted. The Company plans to repay the outstanding balance upon maturity with its cash and cash equivalents balance. The Convertible Senior Notes are senior, unsecured obligations and are (i) equal in right of payment with the existing and future senior, unsecured indebtedness; (ii) senior in right of payment to any of the Company’s future indebtedness that is expressly subordinated to the Convertible Senior Notes; (iii) effectively subordinated to the Company’s existing and future secured indebtedness, to the extent of the value of the collateral securing that indebtedness, including amounts outstanding under the Loan Agreement or the new Credit Agreement (see section below); and (iv) structurally subordinated to all existing and future indebtedness and other liabilities, including trade payables, and (to the extent the Company is not a holder thereof) preferred equity, if any, of the Company’s subsidiaries that do not guarantee the Convertible Senior Notes. The Convertible Senior Notes accrue interest at 0.25 % per annum payable semi-annually in arrears on March 15 and September 15 of each year, beginning on September 15, 2021. The Convertible Senior Notes will mature on March 15, 2026 unless they are redeemed, repurchased or converted prior to such date. The Convertible Senior Notes are convertible at the option of holders only during certain periods and upon satisfaction of certain conditions. Holders have the right to convert their notes (or any portion of a note in an authorized denomination), in the following circumstances: (i) during any calendar quarter commencing after the calendar quarter ending on June 30, 2021, if the last reported sale price per share of the Company’s common stock exceeds 130 % of the conversion price for each of at least 20 trading days during the 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter; (ii) during the five consecutive business days immediately after any ten consecutive trading day period (such ten consecutive trading day period, the "measurement period") in which the trading price per $1,000 principal amount of notes for each trading day of the measurement period was less than 98 % of the product of the last reported sale price per share of the Company’s common stock on such trading day and the conversion rate on such trading day; (iii) upon the occurrence of certain corporate events or distributions on the Company’s common stock; (iv) if the Company calls such Convertible Senior Notes for redemption; and (v) on or after September 15, 2025, until the close of business on the second scheduled trading day immediately before the maturity date, holders of the Convertible Senior Notes may, at their option, convert all or a portion of their Convertible Senior Notes regardless of the foregoing conditions at any time from, and including, September 15, 2025 until the close of business on the second scheduled trading day immediately before the maturity date. Upon conversion, the Convertible Senior Notes may be settled in shares of the Company’s common stock, cash or a combination of cash and shares of the Company’s common stock, at the Company’s election. All conversions with a conversion date that occurs on or after September 15, 2025 will be settled using the same settlement method, and the Company will send notice of such settlement method to noteholders no later than the open of business on September 15, 2025. Subject to the terms of the indenture agreement, the Company has the right, at its election, to redeem all, or any portion (subject to the partial redemption limitation) in an authorized denomination, of the Convertible Senior Notes, at any time, and from time to time, on a redemption date on or after March 20, 2024 and on or before the 40 th scheduled trading day immediately before the maturity date, for cash, but only if the "last reported sale price," as defined under the Offering Memorandum, per share of common stock exceeds 130 % of the “conversion price” on (i) each of at least 20 trading days, during the 30 consecutive trading days ending on, and including, the trading day immediately before the date the Company sends the related redemption notice; and (ii) the trading day immediately before the date the Company sends such notice. In addition, calling any note for redemption will constitute a "make-whole fundamental change" (as defined below) with respect to that note, in which case the conversion rate applicable to the conversion of that note will be increased in certain circumstances if it is converted after it is called for redemption. If the Company elects to redeem less than all of the outstanding notes, then the redemption will not constitute a make-whole fundamental change with respect to the notes not called for redemption, and holders of the notes not called for redemption will not be entitled to an increased conversion rate for such notes as described above on account of the redemption, except to the limited extent described further below. No sinking fund is provided for the Convertible Senior Notes, which means that the Company is not required to redeem or retire the Convertible Senior Notes periodically. 87 Table of Contents If a fundamental change occurs, then each noteholder will have the right to require the Company to repurchase its notes (or any portion thereof in an authorized denomination) for cash on a date (the "fundamental change repurchase date") of the Company’s choosing, which must be a business day that is no more than 45 , nor less than 20 , business days after the date the Company distributes the related fundamental change notice. If an event of default, other than a reporting default remedied by special interest as defined in the indenture agreement, occurs with respect to the Company or any guarantor, then the principal amount of, and all accrued and unpaid interest on, all of the notes then outstanding will immediately become due and payable without any further action or notice by any person. If an event of default (other than a reporting event of default described above with respect to the Company or any guarantor and not solely with respect to a significant subsidiary of the Company’s or a guarantor, other than the Company or such guarantor) occurs and is continuing, then, the trustee, by notice to the Company, or noteholders of at least 25 % of the aggregate principal amount of notes then outstanding, by written notice to the Company and the trustee, may declare the principal amount of, and all accrued and unpaid interest on, all of the notes then outstanding to become due and payable immediately. The Convertible Senior Notes have an initial conversion rate of 15.6539 shares of common stock per $1,000 principal amount of the Convertible Senior Notes, which will be subject to customary anti-dilution adjustments in certain circumstances. In connection with the pricing of the Convertible Senior Notes, the Company entered into privately negotiated capped call transactions with various financial institutions (the "Capped Call Transactions"). The Capped Call Transactions were entered into with third party broker-dealers to limit the potential dilution that would occur if the Company has to settle the conversion value in excess of the principal in shares. This exposure will be covered (i.e., the Company will receive as many shares as are required to be issued between the conversion price of $ 63.8818 and the maximum price of $ 91.2600 ). Any shares required to be issued by the Company over this amount would have net earnings per share dilution impact. By entering into the Capped Call Transactions, the Company expects to reduce the potential dilution to its common stock (or, in the event the conversion is settled in cash, to reduce its cash payment obligation) in the event that at the time of conversion its stock price exceeds the conversion price under the Convertible Senior Notes. The Company paid $ 39.0 million for the Capped Call Transactions, which was recorded as additional paid-in capital, using a portion of the gross proceeds from the sale of the Convertible Senior Notes. The cost of the Capped Call Transactions is not expected to be tax deductible as the Company did not elect to integrate the capped call into the Convertible Senior Notes for tax purposes. The cost of the Capped Call Transaction was recorded as a reduction of the Company’s additional paid-in capital in the accompanying consolidated financial statements. The Company incurred debt issuance costs of $ 11.4 million in March 2021. The Convertible Senior Notes are presented net of issuance costs on the Company's consolidated balance sheets. The debt issuance costs are amortized on an effective interest basis over the term of the Convertible Senior Notes and are included in interest expense and amortization of debt discount in the accompanying consolidated statements of operations. During the year ended December 31, 2023, the Company repurchased its Convertible Senior Notes in the open market with cash on hand for $ 165.5 million. The Company recognized a gain on extinguishment of debt of $ 26.5 million related to the repurchase of $ 194.9 million of principal balance of Convertible Senior Notes and $ 2.9 million of unamortized debt issuance costs associated with the extinguished debt during the year ended December 31, 2023. The gain on extinguishment is included in other (income) expense in the Company's consolidated statement of operations. The following table sets forth interest expense related to the Convertible Senior Notes for the years ended December 31, 2025, 2024, and 2023 (in thousands, except interest rates): December 31, 2025 December 31, 2024 December 31, 2023 (in thousands, except interest rates) Contractual interest expense $ 513 $ 513 $ 797 Amortization of debt issuance costs 1,172 1,173 1,823 Total interest expense $ 1,685 $ 1,686 $ 2,620 Effective interest rate 0.82 % 0.82 % 0.82 % 2021 and 2024 Credit Agreements On April 30, 2021, the Company entered into a credit agreement (the "2021 Credit Agreement") with Goldman Sachs Bank USA as administrative agent and collateral agent, and other lender parties thereto. The 2021 Credit Agreement provided for a $ 360.0 million seven-year senior secured term loan facility ("2021 Term Loan B Facility"), which had a maturity in April 2028, and a $ 65.0 million senior secured revolving credit facility (as amended in June 2021, the "2021 Revolving Credit Facility"), which had a maturity in December 2025. In June 2023, the Company amended the 2021 Credit Agreement (the "Amended 2021 Credit 88 Table of Contents Agreement") to transition away from a variable interest rate based on the Eurodollar Rate towards a similar variable interest rate based on Adjusted Term SOFR, as defined in the Amended 2021 Credit Agreement, which is based on the secured overnight financing rate ("SOFR"). Amounts outstanding under the Amended 2021 Credit Agreement accrue interest at a rate equal to either, (1) for the 2021 Term Loan B Facility, at the Company’s election, the Adjusted Term SOFR plus a margin of 5.00 % per annum, or ABR (as defined in the Amended 2021 Credit Agreement) plus a margin of 4.00 %, and (2) for the 2021 Revolving Credit Facility, at the Company’s election, the Adjusted Term SOFR plus a margin of 4.25 % to 4.75 %, or ABR plus a margin of 3.25 % to 3.75 %, in each case, depending on the Company’s first lien net leverage ratio. On February 6, 2024, the Company refinanced the Amended 2021 Credit Agreement and entered into a new credit agreement (the "2024 Credit Agreement") with Morgan Stanley Senior Funding, Inc. as the Company term loan administrative agent and Citibank, N.A. as the Company's revolving facility administrative agent and collateral agent, and other lender parties thereto. The 2024 Credit Agreement included a $ 365.0 million seven-year senior secured term loan facility (the "2024 Term Loan B Facility"), which will mature in February 2031 and a $ 175.0 million five-year senior secured revolving credit facility (the "2024 Revolving Credit Facility"), which will mature in February 2029. The Company primarily used the proceeds from the 2024 Term Loan B Facility to repay in full all outstanding amounts owed under the Company's Amended 2021 Credit Agreement. Accordingly, the Amended 2021 Credit Agreement was terminated and replaced in its entirety. The obligations under the 2024 Credit Agreement are secured by substantially all of the assets of the Company. Amounts outstanding under the 2024 Credit Agreement accrue interest at a rate equal to either, (1) for the 2024 Term Loan B Facility, at the Company’s election, Term SOFR (as defined in the 2024 Credit Agreement) plus a margin of 4.50 % per annum, or ABR (as defined in the 2024 Credit Agreement) plus a margin of 3.50 %, and (2) for the 2024 Revolving Credit Facility, at the Company’s election, Term SOFR plus a margin of 3.50 % to 4.00 %, or ABR plus a margin of 2.50 % to 3.00 %, in each case, depending on the Company’s First Lien Net Leverage Ratio (as defined in the 2024 Credit Agreement). On September 18, 2024, the Company entered into Amendment No. 1 to the 2024 Credit Agreement ("Amendment No. 1"), which reduced the interest rate of the 2024 Term Loan B Facility by 75 basis points to Term SOFR plus a margin of 3.75 %, from the previous rate of Term SOFR plus a margin of 4.50 %, and on March 18, 2025, the Company entered into Amendment No. 2 to the 2024 Credit Agreement ("Amendment No. 2"), which reduced the interest rate of the 2024 Term Loan B Facility by an additional 75 basis points to Term SOFR plus a margin of 3.00 %. The remaining terms of the 2024 Term Loan B Facility and the 2024 Revolving Credit Facility were substantially unchanged by these amendments. As of December 31, 2025, the contractual interest rate related to the 2024 Term Loan B Facility was 6.72 %. In addition to having to pay contractual interest on the 2024 Term Loan B Facility, the Company is also required to pay certain other fees, primarily to the lenders under the 2024 Revolving Credit Facility, in order to maintain their revolving facility commitments. The covenants of the 2024 Credit Agreement include customary negative covenants that, among other things, restrict the Company’s ability to incur additional indebtedness, grant liens and make certain acquisitions, investments, asset dispositions and restricted payments. In addition, the 2024 Credit Agreement contains a springing financial covenant that is tested on the last day of any fiscal quarter only if utilization of the 2024 Revolving Credit Facility exceeds 35 % of the total revolving commitments, whereby the Company is required to maintain a First Lien Net Leverage Ratio below 3.25 to 1.00. As of December 31, 2025, no amounts were outstanding under the 2024 Revolving Credit Facility and the Company was in compliance with its debt covenants. At December 31, 2025, amounts available under the 2024 Revolving Credit Facility were $ 171.0 million, net of letters of credit outstanding in the amount of $ 4.0 million. The 2024 Credit Agreement includes customary events of default, and customary rights and remedies upon the occurrence of any event of default thereunder, including rights to accelerate the loans, terminate the commitments thereunder and realize upon the collateral securing the obligations under the 2024 Credit Agreement. The 2024 Credit Agreement calls for customary scheduled loan amortization payments of 0.25 % of the initial principal balance, which at the time of Amendment No. 2 was $ 363.2 million, payable quarterly (i.e. 1 % in aggregate per year) as well as a provision that requires the Company to prepay the 2024 Term Loan B Facility based on an annual calculation of free cash flow ("Excess Cash Flow") as defined by the 2024 Credit Agreement. The Company was not required to make any such mandatory prepayment required by the Excess Cash Flow provision for the period ended December 31, 2025. 89 Table of Contents The following table summarizes the amount outstanding under the Company's 2024 Term Loan B Facility as of December 31, 2025 and 2024: December 31, 2025 December 31, 2024 (in thousands) 2024 Term Loan B Facility $ 360,454 $ 363,177 Unamortized debt discount ( 4,275 ) ( 6,198 ) Unamortized debt issuance costs ( 4,882 ) ( 6,877 ) 2024 Term Loan B Facility, net of debt discount and issuance costs $ 351,297 $ 350,102 February 6, 2024 Debt Refinance As part of the debt refinance on February 6, 2024, where lenders under the Amended 2021 Credit Agreement continued to be lenders under the 2024 Credit Agreement, certain of their loans and revolving facility commitments were deemed to have been modified ("Modified Loans" and "Modified Commitments," respectively). The Company continued to defer debt discount costs of $ 3.7 million and debt issuance costs of $ 5.7 million from Modified Loans over the term of the new 2024 Term Loan B Facility. The Company continued to defer financing costs as of February 6, 2024 of an immaterial amount from Modified Commitments over the term of the new 2024 Revolver Facility. Deferred financing costs are included in other assets, non-current in the consolidated balance sheets. For lenders of the 2021 Credit Agreement that did not continue to participate in the 2024 Credit Agreement, their pro-rata portion of the unamortized debt discount of $ 2.8 million, unamortized debt issuance costs of $ 4.3 million, and an immaterial amount of unamortized deferred financing costs were deemed to be extinguished. The resulting loss on extinguishment of debt of $ 7.4 million is included in other (income) expense in the Company's consolidated statement of operations for the year ended December 31, 2024. The Company paid $ 7.7 million in third-party fees related to the closing of the 2024 Credit Agreement. Third-party fees attributed to new lenders of $ 2.4 million were capitalized as part of the debt issuance costs and will be amortized over the term of the 2024 Term Loan B Facility while third-party fees attributed to Modified Loans of $ 3.1 million were included in general and administrative expenses in the Company's consolidated statement of operations for the year ended December 31, 2024. In addition, third-party fees of $ 2.1 million attributed to new revolving lenders and Modified Commitments were capitalized as part of deferred financing costs and will be amortized over the term of the 2024 Revolving Facility. The Company also capitalized additional debt discount costs of $ 3.7 million associated with the closing of the 2024 Term Loan B Facility, which will be amortized over the term of the 2024 Term Loan B Facility. September 18, 2024 Debt Repricing The Company analyzed the changes of Amendment No. 1 on a lender-by-lender basis and determined that the transaction would primarily be accounted for as a modification, with a portion of it accounted for as debt extinguishment and new debt issuance. As a result, the Company recognized an immaterial loss on extinguishment related to unamortized debt discount and unamortized debt issuance costs related to the portion of the 2024 Term Loan B Facility that was extinguished. The Company paid $ 1.0 million in third-party fees related to Amendment No. 1 of which an immaterial amount was capitalized as debt issuance costs and $ 1.0 million was included in general and administrative expenses in the Company's consolidated statement of operations for the year ended December 31, 2024. As part of Amendment No. 1, most lenders decided to roll their loan balances over from the original 2024 Term Loan B Facility to the amended 2024 Term Loan B Facility, while some decided to cash out and reassign their loan balances. On September 18, 2024, $ 312.0 million of the 2024 Term Loan B Facility principal balance was rolled over as part of non-cash financing activities while $ 52.1 million of the 2024 Term Loan B Facility principal balance was repaid and then reissued. March 18, 2025 Debt Repricing The Company analyzed the changes of Amendment No. 2 on a lender-by-lender basis and determined that the transaction would primarily be accounted for as a modification, with a portion of it accounted for as debt extinguishment and new debt issuance. As a result, the Company recognized a loss on extinguishment of $ 2.2 million related to $ 1.0 million of unamortized debt discount and $ 1.1 million of unamortized debt issuance costs related to the portion of the 2024 Term Loan B Facility that was extinguished. The Company incurred $ 1.0 million of third-party debt refinancing expense, which was included in general and administrative expenses in the Company's consolidated statement of operations for the year ended December 31, 2025. As part of Amendment No. 2, most of the 2024 Term Loan B lenders decided to roll their loan balances over from Amendment No. 1 to Amendment No. 2, while some decided to cash out and reassign their loan balances. On March 18, 2025, $ 270.6 million of the 2024 Term Loan B principal balance from Amendment No. 1 was rolled over to Amendment No. 2 as part of non-cash financing 90 Table of Contents activities while $ 92.6 million of the 2024 Term Loan B Facility principal balance from Amendment No. 1 was repaid and then reissued as part of Amendment No. 2. The following table sets forth interest expense related to the 2024 Term Loan B Facility and 2021 Term Loan B Facility for the years ended December 31, 2025, 2024, and 2023 (in thousands, except interest rates): December 31, 2025 December 31, 2024 December 31, 2023 (in thousands, except interest rates) Contractual interest expense $ 27,211 $ 35,139 $ 36,261 Amortization of debt discount 903 1,111 1,564 Amortization of debt issuance costs 1,022 1,299 2,441 Total interest expense $ 29,136 $ 37,549 $ 40,266 Effective interest rate 8.04 % 10.35 % 11.40 % The estimated remaining amortization expense for the 2024 Term Loan B Facility debt discount and debt issuance costs for fiscal years 2026 through 2030 and thereafter was as follows (in thousands): Fiscal Year Debt Discount Debt Issuance Costs 2026 $ 856 $ 978 2027 847 968 2028 839 958 2029 830 948 2030 821 938 Thereafter 82 92 Total $ 4,275 $ 4,882 Total Interest Expense and Interest Income Interest expense consists primarily of contractual interest expense and amortization of debt discount, debt issuance costs, and deferred financing costs related to the Company's debt facilities under its 2024 Credit Agreement, Amended 2021 Credit Agreement as well as its Convertible Senior Notes. Interest income primarily consists of interest earned on the Company's cash equivalents. The following includes interest expense and interest income, as presented within interest expense, net in the consolidated statement of operations (in thousands): December 31, 2025 December 31, 2024 December 31, 2023 Interest expense $ 31,648 $ 40,430 $ 43,461 Interest income ( 12,725 ) ( 13,398 ) ( 11,092 ) Interest expense, net $ 18,923 $ 27,032 $ 32,369 Note 13— Commitments and Contingencies Commitments The Company has commitments under non-cancelable operating leases for facilities, and its managed data center facilities (refer to Note 11). As of December 31, 2025 and 2024, the Company had $ 4.0 million and $ 5.2 million, respectively, of letters of credit associated with office leases available for borrowing, on which there were no outstanding borrowings as of either date. In the normal course of business, the Company enters into non-cancelable contractual obligations with various parties, primarily related to cloud-managed service agreements, software service agreements, and data center providers. As of December 31, 91 Table of Contents 2025, the Company's outstanding non-cancelable contractual obligations with a remaining term in excess of one year consist of the following (in thousands): Fiscal Year 2026 $ 122,494 2027 69,934 2028 10,712 2029 458 2030 447 Thereafter 37 Total $ 204,082 The amounts above include commitments under a cloud-managed services agreement, under which the Company has a non-cancelable commitment from July 2025 to June 2028 containing minimum spend amounts for each twelve-month period (i.e. July 2025 to June 2026, July 2026 to June 2027, and July 2027 to June 2028) as well as an additional minimum spend amount over the entire three-year term. The table above approximates the manner in which the Company expects to fulfill the obligation. Guarantees and Indemnification The Company’s agreements with sellers, buyers, and other third parties typically obligate the Company to provide indemnity and defense for losses resulting from claims of intellectual property infringement, damages to property or persons, business losses, or other liabilities. Generally, these indemnity and defense obligations relate to the Company’s own business operations, obligations, and acts or omissions. However, under some circumstances, the Company agrees to indemnify and defend contract counterparties against losses resulting from their own business operations, obligations, and acts or omissions, or the business operations, obligations, and acts or omissions of third parties. For example, because the Company’s business interposes the Company between buyers and sellers in various ways, buyers often require the Company to indemnify them against acts and omissions of sellers, and sellers often require the Company to indemnify them against acts and omissions of buyers. In addition, the Company’s agreements with sellers, buyers, and other third parties typically include provisions limiting the Company’s liability to the counterparty, and the counterparty’s liability to the Company. These limits sometimes do not apply to certain liabilities, including indemnity obligations. These indemnity and limitation of liability provisions generally survive termination or expiration of the agreements in which they appear. The Company has also entered into indemnification agreements with its directors, executive officers, and certain other officers that will require the Company, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as directors, officers, or employees. No material demands have been made upon the Company to provide indemnification under such agreements and there are no claims that the Company is aware of that could have a material effect on the Company’s consolidated financial statements. Litigation The Company and its subsidiaries may from time to time be parties to legal or regulatory proceedings, lawsuits and other claims incident to their business activities and to the Company’s status as a public company. Such routine matters may include, among other things, assertions of contract breach or intellectual property infringement, claims for indemnity arising in the course of the Company’s business, claims relating to our collection or use of data, regulatory investigations, audits by taxing authorities, or enforcement proceedings, and claims by persons whose employment has been terminated. For example, the Company has recently been subject to class action lawsuits alleging violations of various privacy statutes. Additionally, on September 16, 2025, the Company filed a lawsuit against Google LLC ("Google") in the U.S. District Court of the Eastern District of Virginia. The complaint alleges that Google has engaged in anticompetitive conduct in the ad exchange and ad server markets in violation of federal antitrust laws, including actions that restrict publishers' ability to use competing services and favor Google's own advertising exchange. Magnite seeks monetary damages, an injunction, structural relief, and reimbursement of reasonable costs and expenses. Magnite intends to pursue its claims vigorously, but cannot predict the outcome of this matter. Such matters are subject to many uncertainties, and outcomes are not predictable with assurance. Consequently, management is unable to ascertain the ultimate aggregate amount of monetary liability or awards, amounts which may be covered by insurance or recoverable from third parties, or the financial impact with respect to such matters as of December 31, 2025. However, based on management’s knowledge as of December 31, 2025, management believes that the final resolution of these matters known at such date, individually and in the aggregate, will not have a material adverse effect upon the Company’s consolidated financial position, results of operations or cash flows. 92 Table of Contents Employment Contracts The Company has entered into severance agreements with certain employees and officers. The Company may be required to pay severance and accelerate the vesting of certain equity awards in the event of involuntary terminations. Note 14— Stockholders' Equity On February 1, 2024, the Board of Directors approved a share repurchase program (the "February 2024 Repurchase Plan") under which the Company is authorized to repurchase common stock or Convertible Senior Notes, with an aggregate market value of up to $ 125.0 million, through February 1, 2026. Under the February 2024 Repurchase Plan, 4.5 million shares were purchased in open market purchases through December 31, 2025 for a total of approximately $ 60.9 million at an average of $ 13.43 per share. The average price paid per share purchased under the Program includes broker commission costs. As of December 31, 2025, $ 64.1 million remains available under the February 2024 Repurchase Plan. For accounting purposes, common stock repurchases under the Company's repurchase programs are recorded based upon the purchase date of the applicable trade. Repurchased shares are accounted for as treasury stock in the consolidated balance sheets and have all been subsequently retired. Note 15— Accumulated Other Comprehensive Loss The components of accumulated other comprehensive loss, which relate to foreign currency translation, were as follows (in thousands): Accumulated Other Comprehensive Loss Balance at December 31, 2022 $ ( 3,151 ) Other comprehensive income 1,075 Balance at December 31, 2023 ( 2,076 ) Other comprehensive loss ( 2,345 ) Balance at December 31, 2024 ( 4,421 ) Other comprehensive income 2,970 Balance at December 31, 2025 $ ( 1,451 ) Note 16— Stock-Based Compensation In connection with its IPO, the Company implemented its 2014 Equity Incentive Plan, which governs equity awards made to employees and directors of the Company since the IPO. In November 2014, the Company approved the 2014 Inducement Grant Equity Incentive Plan (the "Inducement Plan"), which governs certain equity awards made to certain employees in connection with commencement of employment. In connection with the Company's acquisition of nToggle, Inc. ("nToggle"), it assumed the nToggle 2014 Equity Incentive Plan (the "nToggle Plan"), and in connection with the merger with Telaria, Inc. ("Telaria"), the Company assumed Telaria's 2013 Equity Incentive Plan, as amended (the "Telaria Plan"). Available shares under the nToggle Plan and the Telaria Plan were rolled into the available share pool under the 2014 Equity Incentive Plan at the time of acquisition of and merger with, respectively, each company. On June 14, 2023, the Company's stockholders approved the Magnite, Inc. Amended and Restated 2014 Equity Incentive Plan (the "Amended and Restated 2014 Equity Incentive Plan"), which, among other things, increased the aggregate maximum number of shares of common stock that may be issued under the plan, removed the prior evergreen provision, and extended the plan through April 2033. All compensatory equity awards outstanding at December 31, 2025 were issued pursuant to the Amended and Restated 2014 Equity Incentive Plan, the 2014 Equity Incentive Plan, the nToggle Plan, the Telaria Plan, or the Inducement Plan. The Company’s equity incentive plans provide for the grant of equity awards, including non-statutory or incentive stock options, restricted stock awards ("RSAs"), restricted stock units that vest based on continuous service ("RSUs"), and restricted stock units that include performance criteria (“performance stock units” or "PSUs"), to the Company's employees, officers, directors, and consultants. The Company's board of directors administers the plans. Options vest based upon continued service at varying rates, but generally over four years from issuance with 25 % vesting after one year of service and the remainder vesting monthly thereafter. RSAs and RSUs vest at varying rates, typically approximately 25 % vesting after approximately one year of service and the remainder vesting annually, semi-annually, or quarterly thereafter. In addition, each Director of the Company's Board of Directors receives an annual grant which vests at the earlier of the one year anniversary of the grant date and the following annual shareholder meeting in addition to an initial equity awards in the first year of their election into the Board of Directors. Options, RSAs, RSUs, 93 Table of Contents and PSUs granted under the plans accelerate under certain circumstances for certain participants upon a change in control, as defined in the governing plan. As of December 31, 2025, an aggregate of 16,576,998 shares remained available for future grants, assuming target number of PSUs, under the Amended and Restated 2014 Equity Incentive Plan. Stock Options A summary of stock option activity for the year ended December 31, 2025 is as follows: Shares Under Option Weighted- Average Exercise Price Weighted- Average Contractual Life Aggregate Intrinsic Value (in thousands) (in thousands) Outstanding at December 31, 2024 4,160 $ 8.57 Granted 81 $ 16.46 Exercised ( 526 ) $ 5.82 Expired ( 28 ) $ 17.23 Outstanding at December 31, 2025 3,687 $ 9.07 3.9 years $ 31,543 Exercisable at December 31, 2025 3,477 $ 8.84 3.6 years $ 30,808 The total intrinsic value of options exercised during the years ended December 31, 2025, 2024, and 2023 was $ 8.4 million, $ 1.0 million, and $ 2.2 million, respectively, based on their respective exercise dates. At December 31, 2025, the Company had unrecognized stock-based compensation expense relating to unvested stock options of approximately $ 1.5 million, which is expected to be recognized over a weighted-average period of 2.0 years. The Company estimates the fair value of stock options that contain service conditions using the Black-Scholes option pricing model. The grant date fair value of options granted during the years ended December 31, 2025, 2024, and 2023 was $ 11.40 , $ 6.34 , and $ 7.27 , respectively, per share. The weighted-average input assumptions used by the Company were as follows: Year Ended December 31, 2025 December 31, 2024 December 31, 2023 Expected term (in years) 5.0 5.0 5.0 Risk-free interest rate 4.45 % 3.93 % 3.99 % Expected volatility 84 % 84 % 84 % Dividend yield — % — % — % Restricted Stock Units A summary of restricted stock unit ("RSU") activity for the year ended December 31, 2025 is as follows: Number of Shares Weighted-Average Grant Date Fair Value (in thousands) Restricted stock units outstanding at December 31, 2024 11,809 $ 10.69 Granted 4,372 $ 16.59 Canceled ( 840 ) $ 11.73 Vested and released ( 5,823 ) $ 11.43 Restricted stock units outstanding at December 31, 2025 9,518 $ 12.86 The weighted-average grant date fair value per share of restricted stock units granted during the years ended December 31, 2025, 2024, and 2023 was $ 16.59 , $ 9.43 , and $ 10.67 , respectively. The fair value of restricted stock units that vested and were released during the years ended December 31, 2025, 2024, and 2023 was $ 109.3 million, $ 61.9 million, and $ 50.7 million, respectively, based on their respective vesting dates. At December 31, 2025, the intrinsic value of unvested restricted stock units was $ 154.5 million. At December 31, 2025, the Company had unrecognized stock-based compensation expense relating to unvested restricted stock units of approximately $ 100.7 million, which is expected to be recognized over a weighted-average period of 2.3 years. 94 Table of Contents Performance Stock Units The Company granted 379,635 performance stock units ("PSU") to the Company's CEO in August 2021, (the "August 2021 PSUs"), which are subject to both time-based and performance-based vesting conditions. The PSUs consist of three equal tranches (each, a "Performance Tranche"), based on achievement of a share price condition if the Company achieves share price targets of $ 60.00 , $ 80.00 , and $ 100.00 , respectively, over 60 consecutive trading days during a performance period commencing on August 26, 2022 and ending on August 26, 2026. The grant date fair value for such PSUs was estimated using a Monte-Carlo simulation model that incorporates option-pricing inputs covering the period from the grant date through the end of the performance period. To the extent any of the performance-based requirements are met, the Company's CEO must also provide continued service to the Company through at least August 26, 2024 to receive any shares of common stock underlying the grant and through August 26, 2026 to receive all of the shares of common stock underlying the performance units that have satisfied the applicable performance-based requirement. In 2022 and 2023, the Company granted PSUs to select executive employees that vest based on share price metrics tied to total shareholder return ("TSR") relative to a peer group over a three-year period, assuming a performance measurement of 100 %. These PSUs are also subject to a time-based service component. The grant date fair value for such PSUs was estimated using a Monte-Carlo simulation model that incorporates option-pricing inputs covering the period from the grant date through the end of the performance period. Between 0 % and 150 % of the performance stock units will vest at the end of the performance period, which is generally on the third anniversary of the PSU grant date. In 2024, the Company granted PSUs to select executive employees that vest based on share price metrics tied to total shareholder return ("TSR") relative to a peer group over a three-year period beginning January 1, 2024, as well as certain interim measurements based on relative TSR for the one-year and two-year periods beginning on January 1, 2024, assuming a performance measurement of 100 %. At December 31, 2024, the one-year interim performance measurement was 150 %, subject to the remaining vesting criteria and at December 31, 2025, the two-year interim performance measurement was also 150 %, subject to the remaining vesting criteria. In 2025, the Company granted PSUs with an aggregate target of 346,287 shares, assuming a performance measurement of 100 %. The amount of shares that will ultimately vest will be determined based on the Company's TSR relative to the TSRs of a peer group for the three-year period beginning January 1, 2025, as well as certain interim measurements based on relative TSR for the one-year and two-year periods beginning on January 1, 2025. At December 31, 2025, the first one-year interim performance measurement was 80 %, subject to the remaining vesting criteria. Stock-based compensation expense for PSUs is based on the grant date fair value and the number of shares assuming a performance measurement of 100 %. The compensation expense will not be reversed if the performance metrics are not met. A summary of PSU activity for the year ended December 31, 2025 is as follows: Number of Shares Weighted-Average Grant Date Fair Value (in thousands) Outstanding at December 31, 2024 1,427 $ 15.35 Granted* 368 $ 20.72 Vested and released* ( 108 ) $ 17.28 Outstanding at December 31, 2025 1,687 $ 16.40 * PSUs granted and weighted-average grant date fair value include 22 shares issued above the target shares for PSUs that vested and were released during the year ended December 31, 2025. 95 Table of Contents The grant date fair value for the PSUs was estimated using a Monte-Carlo simulation model. The grant date fair value of PSUs granted during the years ended December 31, 2025, 2024, and 2023 was $ 20.93 , $ 11.76 , and $ 13.32 , respectively, per share. The weighted-average input assumptions used by the Company were as follows: Year Ended December 31, 2025 December 31, 2024 December 31, 2023 Performance period (in years) 3.0 3.0 3.0 Risk-free interest rate 4.26 % 4.05 % 4.19 % Expected volatility of Magnite 78 % 87 % 94 % Expected volatility of selected peer companies 56 % 55 % 64 % Expected correlation coefficients of Magnite 0.57 0.59 0.62 Expected correlation coefficients of selected peer companies 0.47 0.47 0.54 Dividend yield — % — % — % The fair value of PSUs that vested and were released during the year ended December 31, 2025 was $ 1.9 million, based on their respective vesting dates. No PSUs vested during the years ended December 31, 2024. The fair value of PSUs that vested and were released during the year ended December 31, 2023 was $ 1.2 million, based on their respective vesting dates. At December 31, 2025, the intrinsic value of unvested performance stock units based on expected achievement levels was $ 26.0 million. As of December 31, 2025, the Company had unrecognized stock-based compensation expense relating to unvested PSUs of approximately $ 7.1 million, which will be recognized over a weighted-average period of 1.2 years. Employee Stock Purchase Plan In November 2013, the Company adopted the Company's 2014 Employee Stock Purchase Plan ("ESPP"). The ESPP is designed to enable eligible employees to periodically purchase shares of the Company's common stock at a discount through payroll deductions of up to 10 % of their eligible compensation, subject to any plan limitations. At the end of each six-month offering period, employees are able to purchase shares at a price per share equal to 85 % of the lower of the fair market value of the Company's common stock on the first trading day of the offering period or on the last trading day of the offering period. Offering periods generally commence and end in May and November of each year. On June 14, 2023, the Company's stockholders approved the Magnite, Inc. Amended and Restated 2014 Employee Stock Purchase Plan (the "Amended and Restated 2014 Employee Stock Purchase Plan"), which, among other things, removed the evergreen provision and extended the plan through June 2033. As of December 31, 2025, the Company has reserved 3,959,114 shares of its common stock for issuance under the Company's Amended and Restated 2014 Employee Stock Purchase Plan. Stock-Based Compensation Expense Total stock-based compensation expense recorded in the consolidated statements of operations was as follows: Year Ended December 31, 2025 December 31, 2024 December 31, 2023 (in thousands) Cost of revenue $ 2,130 $ 1,924 $ 1,809 Sales and marketing 32,942 31,436 27,263 Technology and development 17,025 18,210 20,542 General and administrative 24,551 24,949 22,860 Merger, acquisition, and restructuring costs — — 143 Total stock-based compensation expense $ 76,648 $ 76,519 $ 72,617 For the year ended December 31, 2025, the Company recognized $ 57.3 million of income tax benefit on stock-based compensation expense related to 2025, which was reflected in the provision (benefit) for income taxes in the consolidated statements of operations. For the year ended December 31, 2025, income tax benefit realized related to awards vested or exercised during 2025 was $ 27.3 million. For the year ended December 31, 2024, the Company recognized $ 1.1 million of income tax benefit on stock-based compensation expense related to 2024, which was reflected in the provision (benefit) for income taxes in the consolidated statements of operations. For the year ended December 31, 2024, income tax benefit realized related to awards vested or exercised during 2024 was $ 14.5 million. For the year ended December 31, 2023, the Company recognized $ 5.5 million of income tax expense on stock-based compensation expense related to 2023, which was reflected in the provision (benefit) for income 96 Table of Contents taxes in the consolidated statements of operations. For the year ended December 31, 2023, income tax benefit realized related to awards vested or exercised during 2023 was $ 12.5 million. Note 17— Income Taxes The following are the domestic and foreign components of the Company’s income (loss) before income taxes for the years ended December 31, 2025, 2024, and 2023: Year Ended December 31, 2025 December 31, 2024 December 31, 2023 (in thousands) Domestic $ 62,422 $ 19,481 $ ( 165,311 ) International 8,205 7,003 7,764 Income (loss) before income taxes $ 70,627 $ 26,484 $ ( 157,547 ) The following are the components of the provision (benefit) for income taxes for the years ended December 31, 2025, 2024, and 2023: Year Ended December 31, 2025 December 31, 2024 December 31, 2023 (in thousands) Current: Federal $ ( 170 ) $ 89 $ 218 State 2,545 1,803 1,994 Foreign 1,953 1,743 1,707 Total current provision 4,328 3,635 3,919 Deferred: Federal ( 49,348 ) 47 763 State ( 27,453 ) ( 235 ) ( 5,317 ) Foreign ( 1,513 ) 251 2,272 Total deferred provision (benefit) ( 78,314 ) 63 ( 2,282 ) Total provision (benefit) for income taxes $ ( 73,986 ) $ 3,698 $ 1,637 The Company recorded an income tax benefit of $ 74.0 million for the year ended December 31, 2025 compared to an income tax expense of $ 3.7 million and $ 1.6 million for the years ended December 31, 2024 and 2023, respectively. The income tax benefit for the year ended December 31, 2025 was primarily the result of the release of the majority of the domestic and certain foreign valuation allowances on the Company's deferred tax assets and the state and foreign income tax liabilities. The release was supported by sustained profitability and the Company’s cumulative three-year pre-tax income position, inclusive of the impact of permanent book-to-tax differences, as of December 31, 2025, together with forecasts of future taxable income and the expected reversal of taxable temporary differences sufficient to support realization of deferred tax assets. The income tax expense for the year ended December 31, 2024 was primarily the result of the domestic valuation allowance on the Company's deferred tax assets and the federal, state, and foreign income tax liabilities. The income tax expense for the year ended December 31, 2023 was primarily the result of the domestic valuation allowance on the Company's deferred tax assets and the federal, state, and foreign income tax liabilities. The Company continues to maintain a valuation allowance against certain state and foreign deferred tax assets where it is not more likely than not that such assets will be realized. Set forth below provides the updated requirements of ASU 2023-09 for 2025 (see Note 2). The table below is a reconciliation of the components that caused the Company’s provision (benefit) for income taxes to differ from amounts computed by applying the U.S. federal statutory rate of 21% for the year ended December 31, 2025 (in thousands except for percentages): 97 Table of Contents Year Ended December 31, 2025 Amount Percent U.S. federal statutory income tax rate $ 14,832 21.0 % Domestic state and local income taxes, net of federal effect (1) ( 19,677 ) ( 27.9 ) % Foreign tax effects: United Kingdom: Changes in valuation allowance ( 492 ) ( 0.7 ) % Stock option windfall benefit ( 837 ) ( 1.2 ) % Other 683 1.0 % Other foreign jurisdictions ( 589 ) ( 0.8 ) % Tax credits: Research and development credits ( 1,889 ) ( 2.7 ) % Nontaxable and nondeductible items: Sec 162(m) officers' compensation 9,052 12.8 % Stock-based compensation expense ( 8,867 ) ( 12.6 ) % Other 581 0.8 % Changes in valuation allowances (2) ( 67,036 ) ( 94.9 ) % Worldwide changes in prior years unrecognized tax expenses 130 0.2 % Other 123 0.2 % Total tax provision (benefit) and effective income tax rate $ ( 73,986 ) ( 104.8 ) % (1) We consistently report the effects of the state valuation allowance on the state income tax expense line-item within our effective tax rate. In 2025, we released $ 22.0 million of our valuation allowance on our U.S. state deferred tax assets. State taxes in California, New York, and Virginia made up the majority (greater than 50%) of the tax effect in this category. See the income taxes paid table below as required under ASU 2023-09. (2) In 2025, we released our entire valuation allowance of $ 67.0 million on our U.S. federal deferred tax assets. This is included on the change in valuation allowance line item. As previously disclosed for the years ended December 31, 2024 and 2023, prior to the adoption of ASU 2023-09, the table below is a reconciliation of the components that caused the Company’s provision (benefit) for income taxes to differ from amounts computed by applying the U.S. federal statutory rate of 21%: Year Ended December 31, 2024 December 31, 2023 U.S. federal statutory income tax rate 21.0 % 21.0 % State income taxes, net of federal benefit 4.6 % 1.7 % Foreign income (loss) at other than U.S. rates 1.8 % ( 0.3 ) % Stock-based compensation expense 9.0 % ( 2.4 ) % Meals and entertainment 1.9 % ( 0.3 ) % Other permanent items 0.9 % ( 0.2 ) % Change in valuation allowance ( 42.5 ) % ( 17.8 ) % Sec 162(m) officers' compensation 19.1 % ( 3.3 ) % Provision to return adjustments 4.9 % 0.2 % Research and development tax credits ( 6.9 ) % 0.4 % Foreign withholding taxes 0.2 % — % Effective income tax rate 14.0 % ( 1.0 ) % 98 Table of Contents Set forth below are the tax effects of temporary differences that give rise to a significant portion of the deferred tax assets and deferred tax liabilities as of December 31, 2025 and 2024: December 31, 2025 December 31, 2024 (in thousands) Deferred Tax Assets: Allowance for doubtful accounts $ 1,853 $ 1,597 Accrued liabilities 1,180 2,102 Lease liabilities 8,735 8,704 Stock-based compensation 2,830 3,053 Intangible assets — 1,276 Net operating loss carryovers 70,295 77,581 Tax credit carryovers 12,430 11,098 Capitalized facilitative costs 11,014 5,975 Other 2,455 816 Total deferred tax assets 110,792 112,202 Less valuation allowance ( 4,257 ) ( 94,373 ) Deferred tax assets, net of valuation allowance 106,535 17,829 Deferred Tax Liabilities: Fixed assets ( 17,550 ) ( 7,510 ) Intangible assets ( 2,919 ) — Right-of-use lease assets ( 7,685 ) ( 7,647 ) Debt issuance and original issue discount ( 2,066 ) ( 3,082 ) Total deferred tax liabilities ( 30,220 ) ( 18,239 ) Net deferred tax assets (liabilities) $ 76,315 $ ( 410 ) As of December 31, 2025, the net deferred tax asset of $ 76.3 million consists of deferred tax assets of $ 76.7 million and deferred tax liabilities of $ 0.3 million. As of December 31, 2024, the net deferred tax liabilities of $ 0.4 million consists of deferred tax liabilities of $ 0.7 million and deferred tax assets of $ 0.3 million. The valuation allowance was decreased by $ 90.1 million and $ 12.6 million for the years ended December 31, 2025 and 2024, respectively, and increased by $ 30.2 million for the year ended December 31, 2023. The net deferred tax assets balance is presented in other assets, non-current within the Company's consolidated balance sheets and the net deferred tax liabilities balance is presented in other liabilities, non-current within the Company's consolidated balance sheets. The Company evaluates the realizability of deferred tax assets on a jurisdictional basis at each reporting date and records a valuation allowance when it is more likely than not that some portion or all of a deferred tax asset will not be realized. In assessing realizability, the Company considers all available positive and negative evidence, including cumulative results of operations, historical and projected taxable income, reversal of taxable temporary differences, and the carryforward periods of existing tax attributes. During the year ended December 31, 2025, the Company concluded that it is more likely than not that substantially all of its U.S. federal and certain state deferred tax assets will be realized. This conclusion was primarily driven by (i) sustained profitability and a cumulative three-year pre-tax income position as of December 31, 2025, (ii) forecasts of future taxable income, and (iii) the expected reversal of taxable temporary differences sufficient to support realization of deferred tax assets. As a result, the Company released its U.S. federal, the majority of its state, and certain foreign valuation allowances during 2025. A valuation allowance continues to be recorded against certain New York state and city net operating losses subject to Section 382 limitations and certain foreign net operating losses where realization is not considered more likely than not. At December 31, 2025, the Company had U.S. federal net operating loss carryforwards, or NOLs, of approximately $ 252.6 million. Approximately $ 103.5 million were generated in tax years beginning before January 1, 2018 and may offset 100% of taxable income, but begin to expire in 2037. The remaining federal net operating losses were generated in tax years beginning after December 31, 2017, have an indefinite carryforward period, and may offset up to 80% of taxable income in a given year. 99 Table of Contents At December 31, 2025, the Company had state NOLs of approximately $ 205.3 million, which will begin to expire in 2028. At December 31, 2025, the Company had foreign NOLs of approximately $ 17.6 million, which will begin to expire in 2026. At December 31, 2025, the Company had acquired federal research and development tax credit carryforwards of approximately $ 8.1 million which will begin to expire in 2036, and state research and development tax credits of approximately $ 10.1 million, the majority of which carry forward indefinitely. Based on current projections of future taxable income, the Company expects to fully utilize its federal net operating losses, federal research and development credits, and the majority of the state net operating losses prior to expiration. Certain New York state and city net operating losses are subject to Section 382 limitations and are not expected to be fully realized. Based on current foreign business operations in certain foreign jurisdictions, the Company continues to maintain valuation allowances for losses that are not likely to be realized. At December 31, 2025, unremitted earnings of the subsidiaries outside of the United States were approximately $ 40.7 million. The Company’s intention is to indefinitely reinvest these earnings outside the United States. Upon distribution of those earnings in the form of a dividend or otherwise, the Company would be subject to withholding taxes payable to various foreign countries and, potentially, various state taxes. The amounts of such tax liabilities that might be payable upon actual repatriation of foreign earnings, after consideration of corresponding foreign tax credits, are not material. The following table summarizes the activity related to the unrecognized tax benefits (in thousands): Amount Balance as of December 31, 2023 $ 4,443 Increases related to current year tax positions 490 Decreases related to prior year tax positions ( 457 ) Increases related to prior year tax positions 18 Balance as of December 31, 2024 4,494 Increases related to current year tax positions 529 Decreases related to prior year tax positions ( 288 ) Balance as of December 31, 2025 $ 4,735 Interest and penalties related to the Company’s unrecognized tax benefits accrued at December 31, 2025, 2024, and 2023 were not material. 100 Table of Contents Set forth below provides the new requirements of ASU 2023-09 for 2025 (see Note 2). The following table summarizes the income taxes paid, net of refunds, for the year ended December 31, 2025: Year Ended December 31, 2025 (in thousands) U.S. federal $ 200 U.S. state and local: New York State 216 Virginia 211 Michigan 200 Other 1,449 Foreign: Australia 676 India 424 Other 384 Total income taxes paid $ 3,760 Due to the net operating loss carryforwards, the Company's United States federal and a majority of its state returns are open to examination by the Internal Revenue Service and state jurisdictions for all years since inception. For the India, Netherlands, Sweden, and the United Kingdom, all tax years remain open for examination by the local country tax authorities, for France only 2023 and forward are open for examination, for Australia and Singapore only 2022 and forward are open for examination, for Brazil, Canada, Germany, Malaysia, and New Zealand only 2021 and forward are open for examination, for Italy only 2020 and forward are open for examination, and for Japan 2019 and forward remain open for examination. The Company does not expect its uncertain income tax positions to have a material impact on its consolidated financial statements within the next twelve months. On July 4, 2025, the President of the United States signed H.R. 1, commonly referred to as the "One Big Beautiful Bill Act" ("OBBBA") into law. The legislation includes several changes to federal tax law that generally allow for more favorable deductibility of certain business expenses beginning in 2025, including the restoration of immediate expensing of domestic R&D expenditures, reinstatement of 100% bonus depreciation, and more favorable rules for determining the limitation on business interest expense. OBBBA also includes certain changes to the U.S. taxation of foreign activity, including changes to foreign tax credits, Global Intangible Low-Taxed Income, Foreign-Derived Intangible Income, and Base Erosion and Anti-Abuse Tax amongst other changes. These changes are generally effective for tax years beginning after December 31, 2025. OBBBA changes effective for 2025 were reflected in the income tax provision for the year ended December 31, 2025. Based on current projections, the continuing impact will be a deferral of the payment of current income taxes over multiple years; however, the Company expects the net impact to its effective tax rate for 2026 to be immaterial. The Company will monitor as additional guidance becomes available. Note 18— Merger, Acquisition, and Restructuring Costs Merger, acquisition, and restructuring costs consist primarily of professional services fees and employee termination costs, including stock-based compensation charges, associated with historical acquisitions and restructuring activities. The Company incurred $ 0.2 million of merger, acquisition, and restructuring costs for the year ended December 31, 2025 and did not incur any merger, acquisition, and restructuring costs for the year ended December 31, 2024. During the year ended December 31, 2023, the Company incurred $ 7.5 million of merger, acquisition, and restructuring costs related to the Company's reduction of its global workforce primarily associated with the elimination of duplicative roles and other costs associated with the consolidation of its legacy CTV and SpotX CTV platforms following the SpotX, Inc. ("SpotX") acquisition, including loss contracts for office facilities the Company does not plan to continue to occupy and impairment charges related to certain assets it no longer plans to utilize. 101 Table of Contents The following table summarizes merger, acquisition, and restructuring cost activity in the year ended December 31, 2023: Year Ended December 31, 2023 (in thousands) Personnel related (severance and one-time termination benefit costs) $ 3,218 Loss contracts (facility related) 2,190 Exit costs 1,408 Impairment of property and equipment, net 506 Non-cash stock-based compensation (double trigger acceleration and severance) 143 Professional services (investment banking advisory, legal and other professional services) — Total merger, acquisition, and restructuring costs $ 7,465 Accrued restructuring costs related to mergers, acquisition, and restructuring activities were primarily related to the SpotX acquisition and the Telaria merger. Accrued restructuring costs associated with personnel costs are included in accounts payable and accrued expenses and accruals related to assumed loss contracts are included in other current liabilities and other liabilities, non-current on the Company's consolidated balance sheets. The following table summarizes accrued restructuring activity in the year ended December 31, 2023: Year Ended December 31, 2023 (in thousands) Accrued merger, acquisition, and restructuring costs at beginning of period $ 1,222 Personnel related and non-cash stock-based compensation 3,361 Loss contracts (facility related) 2,190 Exit costs 1,408 Impairment of property and equipment, net 506 Cash paid for restructuring costs ( 4,521 ) Non-cash loss contracts (lease related) ( 2,190 ) Non-cash impairments ( 506 ) Non-cash stock-based compensation ( 143 ) Accrued merger, acquisition, and restructuring costs at end of period $ 1,327 Accrued restructuring activity for the years ended December 31, 2025 and 2024 relate to $ 0.2 million and $ 0.9 million of cash paid for restructuring costs, respectively. At December 31, 2025 and December 31, 2024, the accrued merger, acquisition, and restructuring costs balance was $ 0.2 million and $ 0.5 million, respectively. Note 19— Related Party Transactions During the years ended December 31, 2025, 2024, and 2023, the Company did not have material transactions with its related parties or affiliates of its related parties requiring disclosure pursuant to the applicable rules of the Financial Accounting Standards Boards or the U.S. Securities and Exchange Commission. 102 Table of Contents Note 20— Subsequent Events In January 2026, the Company granted 4.2 million restricted stock units, 0.4 million performance stock units, and 0.1 million stock options to the Company's employees. The RSUs granted will vest over four years from issuance with approximately 25 % after one year , and the remainder vesting quarterly thereafter. The options granted will vest over four years from grant date, with 25 % vesting after one year and the remainder vesting monthly thereafter. The PSUs will vest on the three-year anniversary of the grant date based on certain stock price performance metrics to be measured on December 31, 2026, December 31, 2027 and December 31, 2028. The award is eligible to vest as to 0 % to 150 % of the target number of PSUs. On February 23, 2026, the Board of Directors approved a new repurchase plan (the “February 2026 Repurchase Plan”), which authorized the repurchase of common stock with a value up to $ 200.0 million, through February 29, 2028. Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure None.