What changed in this filing

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Item 7. Management’s Discussion and Analysis

2025-04-01 compared with 2024-03-26 · 204 added, 178 removed, 331 unchanged (54% of the section changed)

9 unchanged sentences

“Management's Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the fiscal year ended January 31, 2024, filed with the SEC on March 26, 2024.

Through its single software-as-a-service ("SaaS") platform, nCino helps financial institutions ("FI") serving corporate and commercial, small business, consumer, and mortgage customers modernize and more effectively onboard clients, open accounts, make loans and navigate the loan lifecycle, and effectively monitor and manage their portfolio.

Transforming how FIs operate through innovation, reputation and speed, nCino is partnered with more than 1,800 customers globally.

With the nCino Bank Operating System, FIs can:

• digitally serve their clients across lines of business,

As employees at financial institutions do their daily work and serve their clients, they often face inefficiencies from disparate systems, broken workflows, manual processes, and the inability to harness and utilize data effectively.

This negatively impacts risk management, decision making and the experiences of bankers and their clients.

To solve the problem, FIs need technology that helps them reengineer every experience, intelligently and with agility as market needs shift, and a partner with the experience to help advise on best practices.

nCino's trusted platform enables FIs to consolidate vendors while optimizing operations by integrating AI and actionable insights to cohesively bring together people and data and thereby enhance strategic decision-making, risk management, and customer satisfaction.

From managing complex credit portfolios to streamlining account onboarding and originating loans, nCino helps FIs of all sizes globally deliver faster, intelligent, and more connected experiences.

With the nCino Platform, FIs can:

• embrace the power of intelligent automation and uncover data-driven insights,

• improve efficiency,

• elevate employee experience and performance,

• manage risk and compliance more effectively,

• establish an active data, audit, and business intelligence hub, and

• embrace the value of intelligent automation and uncover data-driven insights.

nCino was originally founded in a bank to improve that FI’s operations and client service.

After realizing that the same problems—cumbersome legacy technology, fragmented data, disconnected business functions, and a disengaged workforce made it difficult to maintain relevancy in their clients' lives—were endemic across the financial services industry, nCino spun out as a separate company in late 2011.

This heritage is the foundation of our deep banking domain expertise, which differentiates us, continues to drive our strategy, and makes us uniquely qualified to help FIs create new efficiencies by providing an end-to-end platform that spans business lines and combines capabilities for a seamless experience.

The nCino Bank Operating System was initially designed to help transform commercial and small business lending for community and regional banks.

This solution was introduced to enterprise banks in the United States ("U.S.") in 2014, and then internationally in 2017, and has subsequently expanded across North America, Europe, the Middle East, and Asia-Pacific ("APAC").

Throughout this market expansion, we broadened the nCino Bank Operating System by adding functionality for consumer lending, client onboarding, deposit account opening, analytics and artificial intelligence and machine learning.

In fiscal 2020, we acquired nCino Portfolio Analytics, LLC (formerly Visible Equity) and FinSuite as part of our strategy to build out our nIQ capabilities, and we established our nCino K.K.

joint venture to facilitate our entry into the Japanese market.

Additionally, in January 2022, we acquired SimpleNexus, which expanded our capabilities to the U.S.

point-of-sale mortgage market.

On September 8, 2023, SimpleNexus began operating as SimpleNexus, LLC d/b/a nCino Mortgage, LLC ("nCino Mortgage") as part of our rebranding effort, resulting in a change to the trade name useful life.

As a result, the Company recorded accelerated amortization to fully amortize the remaining trade name intangible asset.

The effect of this change in estimate for the year ended January 31, 2024 was an increase in sales and marketing amortization expense of $9.5 million, which resulted in an increase in loss of operations and net loss attributable to nCino, Inc.

of $9.5 million, or $0.08 per basic and diluted share.

We generally offer the nCino Bank Operating System on a subscription basis pursuant to non-cancellable multi-year contracts that typically range from three to five years, and we employ a “land and expand” business model.

The nCino Bank Operating System is designed to scale with our customers, and once our solution is deployed, we seek to have our customers expand adoption within and across lines of business.

For fiscal 2024, we had a subscription revenue retention rate of 117%.

See Item 7 of this Annual Report on Form 10-K, “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Factors Affecting Our Operating Results—Subscription Revenue Retention Rate” for additional information on subscription revenue retention rates.

• elevate employee and customer experience,

• manage risk and helping to ensure compliance more effectively,

nCino was originally founded in a bank to improve that institution's operations and client service.

After realizing that virtually all banks and credit unions were dealing with the same problems—cumbersome legacy technology, fragmented data, disconnected business functions, and a disengaged workforce made it difficult to maintain relevancy in their clients' lives—nCino was spun out as a separate company in late 2011 to help more institutions solve these challenges using cloud-based technology.

We initially focused on developing the nCino Platform to transform commercial and small business lending for community and regional banks in the United States ("U.S.").

We scaled the platform to enterprise banks in the U.S.

in 2014, and then internationally in 2017.

We have subsequently expanded across North America, Europe, the Middle East, Japan and Asia-Pacific ("APAC").

nCino's approach to market expansion includes strategically building products and acquiring technology to continue to fulfill a platform vision.

Over the years, we built and enhanced products internally to ensure innovation and seamless integration across key solutions lines of commercial, small business and consumer banking.

Through the strategic acquisitions of SimpleNexus, DocFox, FullCircl, ILT, Visible Equity, FinSuite, and our recent acquisition of Sandbox Banking, we significantly augmented the nCino's Platform's capabilities for mortgage lending, onboarding, account opening, indirect auto lending, and advanced analytics and AI.

This strategic approach has allowed us to create a unified platform of best-in-class intelligent solutions, enabling FIs to replace multiple legacy systems, connect their operations, and streamline workflows and processes across various business lines to achieve desired business impact and process improvement.

We generally offer the nCino Platform on a subscription basis pursuant to non-cancellable multi-year contracts that are typically three to five years.

nCino has evolved from being a single product workflow solution to offering a platform of best-in-class, intelligent solutions.

Our new Intelligent Solution Framework pricing model helps ensure the value-based positioning and pricing of our products and creates an opportunity to embed intelligence into all our solutions.

Starting in fiscal 2025, by moving away from a seat-based pricing model to pricing directly correlated to the FI's assets, we are aligning our revenues to the usefulness the nCino Platform provides as nCino creates efficiencies for our customers.

For fiscal 2025, we had a subscription revenue net retention rate of 110%.

See Item 7 of this Annual Report on Form 10-K, “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Factors Affecting Our Operating Results—Subscription Revenue Net Retention Rate” for additional information on subscription revenue retention rates.

We sell our solutions directly through our business development managers, account executives, field sales engineers, and customer success managers.

Our sales efforts in the U.S.

are organized around FIs based on size, whereas internationally, we focus our sales efforts by geography.

As of January 31, 2024, we had 223 sales and sales support personnel in the U.S., including nCino Mortgage, and 69 sales and support personnel in offices outside the U.S.

are organized around FIs based on size, whereas

internationally, we focus our sales efforts by geography.

As of January 31, 2025, we had 194 sales and sales support personnel in the U.S.

and 136 sales and support personnel in offices outside the U.S.

To help customers go live with our solutions, we offer professional services including configuration and implementation, training, and advisory services.

For enterprise FIs, we generally work with SI partners such as Accenture, Deloitte, and PwC for the delivery of professional services for the nCino Bank Operating System.

For enterprise FIs, we generally work with SI partners such as Accenture, Deloitte, and PwC for the delivery of professional services for the nCino Platform.

For regional FIs, we work with SIs such as West Monroe Partners, and for community banks, we work with SIs or perform configuration and implementation ourselves.

We expect enterprise FIs to make up a greater proportion of our nCino Bank Operating System sales.

On January 18, 2023, the Company announced a workforce reduction of approximately seven percent 7% and office space reductions in certain markets (collectively, the “Restructuring Plan”) in furtherance of its efforts to improve operating margins and advance the Company’s objective of profitable growth.

Employees impacted by this event are included in our headcount as of January 31, 2023.

The Company incurred charges in the fourth quarter of the Company’s fiscal 2023 of $4.8 million in connection with the Restructuring Plan.

As of January 31, 2023, the accrual for severance and related benefit costs of $5.0 million for terminated employees was included in accrued compensation and benefits in the consolidated balance sheets and was paid in the first quarter of the Company’s fiscal 2024.

The Company paid $0.8 million in the fourth quarter of fiscal 2023 to exercise an early termination clause to exit a facility during fiscal 2024, which was accounted for as a lease modification under ASC 842.

See Note 19 "Restructuring" of the notes to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K for additional information.

We expect enterprise FIs to make up a greater proportion of our nCino Platform sales.

On March 20, 2024 (the "DocFox Acquisition Date"), we acquired DocFox, Inc.

("DocFox") which provides a solution for automating onboarding experiences for commercial and business banking, for an aggregate preliminary purchase price of $74.3 million.

We funded the purchase consideration with $75.0 million borrowed under our revolving credit facility.

We acquired Integrated Lending Technologies, LLC ("ILT") on April 1, 2024 (the "ILT Acquisition Date"), which provides consumer loan origination software that streamlines direct and indirect lending operations, for an aggregate purchase price of $20.0 million in cash.

On November 5, 2024 (the "FullCircl Acquisition Date"), we acquired Artesian Solutions Limited, operating as FullCircl ("FullCircl"), a UK-based SaaS platform built to help FIs automate and accelerate onboarding and improve client lifecycle management.

We funded $129.2 million of the purchase consideration with borrowings made in October 2024 under our revolving credit facility.

See Note 6 "Business Combinations" and Note 14 "Revolving Credit Facility" of the notes to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K for additional information.

We have included the financial results of DocFox, ILT and FullCircl in the consolidated financial statements from the DocFox Acquisition Date, the ILT Acquisition Date, and the FullCircl Acquisition Date, respectively.

Our total revenues were $408.3 million, $476.5 million, and $540.7 million for fiscal 2023, 2024, and 2025, respectively, representing a 15.1% compound annual growth rate.

Our revenues include $3.9 million in revenues from SimpleNexus from the Acquisition Date for fiscal 2022 and $65.4 million for fiscal 2023.

Our subscription revenues in fiscal 2022 were $224.9 million or 82.1% of total revenues, $344.8 million or 84.4% of total revenues in fiscal 2023, and $409.5 million or 85.9% of total revenues in fiscal 2024, representing a 34.9% compound annual growth rate.

Our subscription-based revenues include $3.7 million from SimpleNexus from the Acquisition Date for fiscal 2022 and $59.8 million for fiscal 2023.

Due to our investments in growth, we recorded net losses attributable to nCino in fiscal 2022, 2023, and 2024 of $49.4 million, $102.7 million, and $42.3 million, respectively.

Our net losses include the operating results of SimpleNexus from the Acquisition Date.

In March 2024, we acquired DocFox, a leading solution provider automating onboarding experiences for commercial and business banking, for an aggregate purchase price of $75.0 million.

Our subscription revenues were $344.8 million, $409.5 million, and $469.2 million for fiscal 2023, 2024, and 2025, representing a 16.7% compound annual growth rate.

Our total subscription revenues include an aggregate of $12.3 million from DocFox, ILT, and FullCircl for fiscal 2025.

We recorded net losses attributable to nCino in fiscal 2023, 2024, and 2025 of $102.7 million, $42.3 million, and $37.9 million, respectively.

For fiscal 2025, our financial results include the operating results of DocFox, ILT and FullCircl from the DocFox Acquisition Date, the ILT Acquisition Date, and the FullCircl Acquisition Date, respectively.

In February 2025, we acquired Alphapack, Co.

dba Sandbox Banking ("Sandbox Banking"), a digital transformation leader serving the financial services industry, for an aggregate purchase price of $52.5 million, subject to customary adjustments, with an additional earn-out opportunity of up to $10.0 million.

This acquisition strengthens our ability to enhance data connectivity and streamline operations for banks and credit unions through an industry-leading Integration Platform as a Service (iPaaS) solution for a more intelligent and harmonious technology platform.

See Note 20 "Subsequent Events" of the notes to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K for additional information.

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Our success in growing our customer base and expanding adoption of our solutions by existing customers requires a focused direct sales engagement and the ability to convince key decision makers at FIs to replace legacy third-party point solutions or internally developed software with our solutions.

Our ability to successfully implement our new asset-based pricing model that formally started in fiscal 2025 will also be a key driver.

In addition, growing our customer base will require us to increasingly penetrate markets outside the U.S., which accounted for 21.5% of total revenues for fiscal 2025.

For new customers, our sales cycles are typically lengthy, generally ranging from six to nine months for smaller FIs to 12 to 18 months or more for larger FIs.

For new customers, our sales cycles are typically lengthy, generally ranging from 6 to 9 for smaller FIs to 12 to 18 months or more for larger FIs.

Key to landing new customers is our ability to successfully take our existing customers live and help them achieve measurable returns on their investment, thereby turning them into referenceable accounts.

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Mix of Subscription and Professional Services Revenues.

The initial deployment of our solutions by our customers requires a period of implementation and configuration services that typically range from three months to 18 months, depending on the scope.

As a result, during the initial go-live period for a customer on the nCino Bank Operating System, professional services revenues generally make up a substantial portion of our revenues from that customer, whereas over time, revenues from established customers are more heavily weighted to subscriptions.

While professional services revenues will fluctuate as a percentage of total revenues in the future and tend to be higher in periods of faster growth, over time we expect subscription revenues will make up an increasing proportion of our total revenues as our overall business grows.

Subscription Revenue Retention Rate .

The initial deployment of our solutions by our customers requires a period of implementation and configuration services that typically average less than six months, but may extend beyond twelve months depending on scope.

As a result, during the initial go-live period for a customer on the nCino Platform, professional services revenues generally make up a substantial portion of our revenues from that customer, whereas over time, revenues from established customers are more heavily weighted to subscriptions.

While professional services

revenues will fluctuate as a percentage of total revenues, we expect subscription revenues will continue to make up an increasing proportion of our total revenues.

Subscription Revenue Net Retention Rate .

We believe that our ability to retain and grow subscription revenues from our existing customers over time strengthens the stability and predictability of our revenue base and is reflective of both the adoption curve of customers and the value we deliver to them.

We assess our performance in this area using a metric we refer to as subscription revenue retention rate.

We calculate our subscription revenue retention rate as total subscription revenues in a fiscal year from customers who contracted for any of our solutions as of January 31 of the prior fiscal year, expressed as a

percentage of total subscription revenues for the prior fiscal year.

We assess our performance in this area using a metric we refer to as subscription revenue net retention rate.

We calculate our subscription revenue net retention rate as total subscription revenues in a fiscal year from customers who contributed subscription revenues in the prior fiscal year, expressed as a percentage of total subscription revenues for the prior fiscal year.

In accordance with this definition, subscription revenues from customers obtained through an acquisition will first be included in the calculation in the fiscal year subsequent to such acquisition, for the periods they were a customer of nCino.

Our subscription revenue retention rate provides insight into the impact on current year subscription revenues of:

• the number and timing of new customers and phased activation of seats purchased by them in prior years, which activation schedules can span several fiscal years for larger contracts;

• expanding adoption of our solutions by our existing customers during the current year, excluding any revenues derived from businesses acquired during such year;

Our subscription revenue net retention rate provides insight into the impact on current year subscription revenues of:

• the number and timing of new customers, subscription fees to be charged existing customers in successive years, and phased activation of seats purchased by them in prior years, which activation schedules can span several fiscal years for larger contracts;

• expanding adoption of our solutions by our existing customers during the current year;

• customer attrition.

For fiscal 2022, 2023, and 2024, we had subscription revenue retention rates of 133%, 148%, and 117%, respectively.

The most significant driver of changes in our subscription revenue retention rate each year has historically been the number of new customers in prior years and the associated phased activation schedules for such customers.

In addition, because larger FIs tend to make more sizable purchases with longer activation schedules, we expect variability in our subscription revenue retention rates based on the timing and extent of our continued penetration of this portion of the market.

The increase in our subscription revenue retention rate for fiscal 2023 was due to the inclusion of customers who had contracts with nCino Mortgage in effect prior to January 31, 2022.

Subscription revenues from periods prior to the acquisition were excluded from the calculation for fiscal 2023.

Excluding nCino Mortgage, the subscription revenue retention rate for fiscal 2023 was 125%.

The moderation in our subscription revenue retention rate for fiscal 2024 was due to a decline in revenues from customers adversely affected by an increase in mortgage interest rates, from the expiration of licenses utilized for forgiveness monitoring of Paycheck Protection Program loans, and from the acquisition of customers by non-customers.

Our use of subscription revenue retention rate has limitations as an analytical tool, and investors should not consider it in isolation.

Other companies in adjacent markets may calculate subscription revenue retention rates or similar metrics differently, which reduces its usefulness as a comparative measure.

Long-term ACV Expansion .

For fiscal 2023, 2024, and 2025, we had subscription revenue net retention rates of 144%, 116%, and 110%, respectively.

The most significant driver of changes in our subscription revenue net retention rate each year has historically been the number of new customers in prior years and the associated phased activation schedules for such customers.

In addition, because larger FIs tend to make more sizable purchases, we expect variability in our subscription revenue net retention rates based on the timing and extent of our continued penetration of this portion of the market.

Excluding our U.S.

mortgage business, the subscription revenue net retention rate for fiscal 2023 was 124%.

The moderation in our subscription revenue net retention rate for fiscal 2024 was due to a decline in revenues from customers adversely affected by an increase in mortgage interest rates, from the expiration of licenses utilized for forgiveness monitoring of Paycheck Protection Program loans, and from the acquisition of certain customers by entities that do not currently use our solutions.

The moderation in our subscription revenue net retention rate for fiscal 2025 was due primarily to a decline in revenues from customers adversely affected by an increase in mortgage interest rates, and from the acquisition of certain customers by entities that do not currently use our solutions.

Our use of subscription revenue net retention rate has limitations as an analytical tool, and investors should not consider it in isolation.

Other companies in adjacent markets may calculate subscription revenue net retention rates or similar metrics differently, which reduces its usefulness as a comparative measure.

For fiscal 2025, we refined our methodology for calculating subscription revenue net retention rate to align with the details disclosed in Item 7 of this Annual Report on Form 10-K, “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Results of Operations regarding the change in subscription revenues.

Using our prior calculation methodology, subscription revenue retention rate was 148%, 117%, 112% for fiscal 2023, 2024, and 2025, respectively.

ACV Net Retention Rate .

A key element of our growth strategy is to expand our deployed footprint with a customer after initial adoption.

Our customers typically purchase the nCino Bank Operating System for a defined line of business or to support a specific use case and, once deployed, we seek to convince the customer to adopt our solutions within and across additional lines of business.

Our customers typically purchase the nCino Platform for a defined line of business or to support a specific use case and, once deployed, we seek to convince the customer to adopt our solutions within and across additional lines of business.

To date, we have been successful in executing our land and expand strategy as a result of the ability of our solutions to streamline workflow, generate meaningful insights for operational improvement, and help drive improved bottom line results.

Due to our rapid growth, many of our customers have not yet come up for renewal, so our historical net retention rates may not be predictive of future results.

If our customers do not continue to see the ability of our solutions to generate return on investment relative to other available solutions or at all, net retention rates could suffer and our operating results could be adversely affected.

We believe our ACV-based net retention of customers over the long term illustrates our success in executing our land and expand strategy, as it demonstrates growing adoption by existing customers, including price increases but net of attrition.

To measure net retention, we categorize customers by the year in which they first contracted for one of our solutions, which we call an annual cohort.

For each annual cohort, we measure the total ACV for our most recently completed fiscal year and divide it by the total ACV for such cohort at the end of the initial cohort year.

We refer to the resulting quotient as “ACV-based net retention.” In any given period, ACV for a customer represents the annualized subscription fees from the fully activated subscription contracts in effect for such customers at the end of the applicable period.

While we expect ACV-based net retention to increase over time for each respective cohort as we execute our land and expand strategy, occasionally ACV-based net retention can moderate from one period to the next, from customer consolidation for example.

The graphic below illustrates our ACV-based net retention for customers initially signed since fiscal 2013.

Customers who signed with nCino Mortgage prior to January 31, 2022, are included in the fiscal 2022 cohort and customers

who signed with Portfolio Analytics prior to January 31, 2020, are represented in the fiscal 2020 cohort.

Each individual cohort is not necessarily predictive of other or future cohorts.

Annual Contract Value ("ACV")

Our historical net retention rates may not be predictive of future results.

If our customers do not continue to see the ability of our solutions to generate return on investment relative to other available solutions or at all, ACV net retention rates could suffer and our operating results could be adversely affected.

We believe our ACV net retention rate over the long term illustrates our success in executing our land and expand strategy, as it demonstrates growing adoption by existing customers, including price increases but net of attrition.

We define ACV net retention rate as total ACV at the end of a fiscal year from customers with ACV as of the end of the prior fiscal year, expressed as a percentage of ACV as of the end of the prior fiscal year, converted to U.S.

dollar with foreign exchange rates in effect as of the end of the applicable period.

We define ACV as the highest annualized subscription fee obligation under customer contracts in effect at the end of the reporting period.

ACV net retention rate can occasionally moderate from one period to the next, from customer attrition for example.

Our ACV net retention rate was 105%, 102%, and 106% for fiscal 2023, 2024, and 2025, respectively.

The moderation in our ACV net retention rate for fiscal 2024 was due to a decline in ACV from customers adversely affected by an increase in mortgage interest rates, from the expiration of licenses utilized for

forgiveness monitoring of Paycheck Protection Program loans, and from the acquisition of customers by non-customers.

The increase in our ACV net retention rate for fiscal 2025 was attributable to increased ACV from customers who expanded their adoption of our solutions, offset in part due to a decline in ACV from customers adversely affected by an increase in mortgage rates.

Macroeconomic Environment.

We are currently operating in a higher interest rate environment as the U.S.

Federal Reserve has raised interest rates as a means to manage inflation.

These rate increases have had an impact on the real estate market in the U.S.

and specifically, the demand for mortgages and mortgage-related products and services, which has had a negative impact on our nCino Mortgage business.

We are currently operating in a fluctuating interest rate environment with inflationary pressures.

These fluctuations have had an impact on the real estate market in the U.S.

and specifically, the demand for mortgages and mortgage-related products and services, which has had a negative impact on our U.S.

mortgage business.

We will continue to monitor the impact the macroeconomic environment may have on our business.

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Subscription Revenues .

Our subscription revenues consist principally of fees from customers for accessing our solutions and maintenance and support services that we generally offer under non-cancellable multi-year contracts, which

typically range from three to five years for the nCino Bank Operating System and one to three years for nCino Mortgage.

Specifically, we offer:

• Client onboarding, loan origination, and deposit account opening applications targeted at a FI’s commercial, small business, and retail lines of business, for which we generally charge on a per seat basis.

• nIQ for which we generally charge based on the asset size of the customer or on a usage basis.

• Through nCino Mortgage, a digital homeownership solution uniting people, systems, and stages of the mortgage process into a seamless end-to-end journey for which we generally charge on a per seat basis.

• Client onboarding, loan origination, and deposit account opening solutions targeted at a FI’s commercial, small business, and retail lines of business, as well as Banking Advisor and other ancillary products, for which we generally charge on a per seat basis or based upon the asset size of the customer.

As we continue to implement our new pricing model, we expect the number of customers we charge based on asset size will increase considerably.

• Through our U.S.

mortgage business, a digital homeownership solution uniting people, systems, and stages of the mortgage process into a seamless end-to-end journey for which we generally charge on a per seat basis or anticipated lending volume basis.

• Maintenance and support services as well as internal-use or “sandbox” development licenses, for which we generally charge as a percentage of the related subscription fees.

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Where seats are activated in stages, we charge subscription fees from the date of activation through the anniversary of the initial activation date, and annually thereafter.

Subscription fees associated with the nCino Bank Operating System are generally billed annually in advance while subscription fees for nCino Mortgage are generally billed monthly in advance.

Subscription fees are generally billed annually in advance while subscription fees for U.S.

mortgage are generally billed monthly in advance.

Maintenance and support fees, as well as development licenses, are provided over the same periods as the related subscriptions, so fees are invoiced and revenues are recognized over the same periods.

Subscription fees invoiced are recorded as deferred revenue pending recognition as revenues.

In certain cases, we are authorized to resell access to Salesforce’s CRM solution along with the nCino Bank Operating System.

In certain cases, we are authorized to resell access to Salesforce’s CRM solution along with the nCino Platform.

When we resell such access, we charge a higher subscription price and remit a higher subscription fee to Salesforce for these subscriptions.

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Professional services and other revenues consist of fees for implementation and configuration assistance, training, and advisory services.

For enterprise and larger regional FIs, we generally work with SI partners to provide the majority of implementation services for the nCino Bank Operating System, for which these SI partners bill our customers directly.

We have historically delivered professional services ourselves for community banks and smaller credit unions and nCino Mortgage has historically provided professional services directly to its customers.

Revenues for implementation, training, and advisory services are generally recognized on a proportional performance basis, based on labor hours incurred relative to total budgeted hours.

For enterprise and larger regional FIs, we generally work with SI partners to provide the majority of implementation services for the nCino Platform, for which these SI partners bill our customers directly.

We have historically delivered professional services ourselves for community banks and smaller credit unions and our U.S.

mortgage business has historically provided professional services directly to its customers.

Revenues for implementation, training, and advisory services are generally recognized on a proportional performance basis,

based on labor hours incurred relative to total budgeted hours.

To date, our losses on professional services contracts have not been material.

During the initial go-live period for a customer on the nCino Bank Operating System, professional services revenues generally make up a substantial portion of our revenues from that customer, whereas over time, revenues from established customers are more heavily weighted to subscriptions.

During the initial go-live period for a customer on the nCino Platform, professional services revenues generally make up a substantial portion of our revenues from that customer, whereas over time, revenues from established customers are more heavily weighted to subscriptions.

While professional services revenues will fluctuate as a percentage of total revenues in the future and tend to be higher in periods of faster growth, over time we expect to see subscription revenues make up an increasing proportion of our total revenues.

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Sales and marketing expenses also include outside consulting fees, marketing programs, including lead generation, costs of our annual user conference, advertising, trade shows, other event expenses, amortization of intangible assets, and allocated overhead.

We expect sales and marketing expenses will decrease as a percentage of revenues as we leverage the investments we have made to date.

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

Research and Development.

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Basic and diluted 110,615,734 112,672,397 115,162,175

1 Includes the operating results of SimpleNexus from the Acquisition Date, see Note 7 "Business Combinations" of the notes to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K for additional information.

1 Includes the operating results of DocFox, ILT and FullCircl from the DocFox Acquisition Date, the ILT Acquisition Date and the FullCircl Acquisition Date, respectively, see Note 6 "Business Combinations" of the notes to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K for additional information.

The Company recognized stock-based compensation expense as follows:

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$ 50,232 $ 58,035 $ 71,592

1 Includes $0.2 million benefit incurred for the fiscal year ended January 31, 2023 in connection with the restructuring plan commenced in January 2023.

See Note 19 "Restructuring" of the notes to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K for more information.

The Company recognized amortization expense for intangible assets as follows:

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Subscription Revenues

Subscription revenues increased $64.7 million for fiscal 2024 compared to fiscal 2023, due to initial revenues from customers who did not contribute to subscription revenues during the prior period and growth from existing customers within and across lines of business.

Subscription revenues increased $59.7 million for fiscal 2025 compared to fiscal 2024, due to initial revenues from customers who did not contribute to subscription revenues during the prior period, growth from existing customers within and across lines of business, and acquisitions.

Of the increase, 70.6% was attributable to increased revenues from existing customers as additional seats were activated in accordance with contractual terms and customers expanded their adoption of our solutions, and 29.4% was attributable to initial revenues from customers who did not contribute to subscription revenues during the prior period.

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Cost of subscription revenues increased $14.1 million for fiscal 2025 compared to fiscal 2024, generating a gross margin for subscription revenues of 71.2% compared to a gross margin of 70.5% for fiscal 2024.

Costs related to Salesforce user fees increased $10.4 million as we continued to add new customers and sell additional functionality to existing customers, and other costs of subscription revenues increased $2.5 million due to costs associated with access to other platforms and data center costs.

Personnel costs, including stock-based compensation expense, increased $2.0 million, mainly from an increase in average headcount.

We expect the cost of subscription revenues will continue to increase in absolute dollars as the number of users of the nCino Bank Operating System grows.

Other costs of subscription revenues increased $6.3 million due to other data costs.

Personnel costs, including stock-based compensation expense, increased $4.0 million, mainly from an increase in overall headcount.

Costs related to Salesforce user fees increased $2.3 million as we continued to add new customers and sell additional functionality to existing customers.

The increase in cost of subscription revenues also included an increase of $1.5 million in amortization expense related to acquired intangibles.

We expect the cost of subscription revenues will continue to increase in absolute dollars as the number of users of the nCino Platform grows.

Cost of Professional Services and Other Revenues

Cost of professional services and other revenues increased $10.3 million for fiscal 2025 compared to fiscal 2024, generating a gross margin for professional services and other revenues of (13.2)% compared to a gross margin of (5.3)% for fiscal 2024.

For fiscal 2024, personnel costs increased $6.3 million for professional services and other revenues compared to the prior year period, mainly from an increase in average headcount and a $2.1 million increase in stock-based compensation expense, partially offset by a decrease in restructuring costs incurred in connection with the headcount reductions announced in January 2023.

The increase in cost of professional services and other revenues also included an increase of $0.8 million in allocated

overhead costs due to growth supporting our business, partially offset by a decrease of $0.3 million in travel-related costs.

The decrease in our professional services and other gross margin for fiscal 2024 was primarily due to a decline in realized effective billing and utilization rates in our professional services teams.

For fiscal 2025, personnel costs increased $9.0 million for professional services and other revenues compared to the prior year period, mainly from an increase in headcount and a $2.6 million increase in stock-based compensation expense.

The increase in cost of professional services and other revenue also included an increase of $1.2 million in third-party costs of

professional services.

The decrease in our professional services and other gross margin for fiscal 2025 was primarily due to a decline in realized effective billing rates in our professional services teams.

Operating Expenses

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Sales and Marketing

Sales and marketing expenses increased $2.9 million for fiscal 2024 compared to fiscal 2023, primarily attributable to an increase of $9.5 million in trade name amortization expense as a result of accelerated amortization expense in the third quarter of fiscal 2024 to fully amortize the remaining trade name intangible asset as a result of the rebranding of the SimpleNexus solution to nCino Mortgage.

The increase in sales and marketing expenses also included an increase of $0.8 million in allocated overhead costs.

The increase in sales and marketing expenses was partially offset by a decrease of $4.3 million in personnel costs, mainly from a decrease in average headcount and a decrease in restructuring costs incurred in connection with the headcount reductions announced in January 2023, partially offset by a $2.1 million increase in stock-based compensation expense, compensation increases, and an increase in expatriate tax equalization expenses.

Also included in the offset to the increase in sales and marketing expenses was a decrease of $1.3 million in marketing costs, a decrease of $1.2 million in sales-related travel costs, and a decrease of $0.6 million in third-party consulting fees.

Our sales and marketing headcount decreased by 64 from January 31, 2023 to January 31, 2024 primarily due to attrition and our workforce reduction announced in January 2023.

We expect sales and marketing expenses will decrease as a percentage of revenues as we leverage the investments we have made to date.

Sales and marketing expenses decreased $7.3 million for fiscal 2025 compared to fiscal 2024, primarily attributable to a decrease of $11.9 million due to no longer amortizing the SimpleNexus trade name intangible asset as a result of the rebranding of the SimpleNexus solution to nCino Mortgage during fiscal 2024, partially offset by an increase of $2.8 million in amortization expense for fiscal 2025 acquired intangible assets.

The decrease in sales and marketing expenses also included a decrease of $0.5 million sales-related travel costs.

The decrease in sales and marketing expenses was partially offset by an increase $1.2 million in personnel costs primarily due to an increase in stock-based compensation expense.

The decrease in sales and marketing expenses was also partially offset by an increase of $1.1 million in marketing costs.

Our sales and marketing headcount increased by 54 from January 31, 2024 to January 31, 2025, primarily due to acquisitions.

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

Research and Development

Research and development expenses decreased $4.3 million for fiscal 2024 compared to fiscal 2023, primarily due to a $2.4 million decrease in third party professional fees as a result of reduced contract research and development spend and a decrease of $2.3 million in personnel costs, mainly from a decrease in average headcount and a decrease in restructuring costs incurred in connection with the headcount reductions announced in January 2023, partially offset by a $4.3 million increase in stock-based compensation expense and compensation increases.

The decrease in research and development expenses was partially offset by an increase of $0.7 million in allocated overhead costs due to growth supporting our continued business expansion.

Our research and development headcount decreased by 71 from January 31, 2023 to January 31, 2024 primarily due to our workforce reduction announced in January 2023.

Research and development expenses increased $12.1 million for fiscal 2025 compared to fiscal 2024, primarily attributable to a $9.2 million increase in personnel cost, mainly from an increase in headcount due to acquisitions and an increase in stock-based compensation expense.

The increase in research and development expenses also included an increase of $2.1 million in third-party professional fees as a result of increased contract research and development spend, and an increase of $0.5 million in allocated overhead costs due to growth supporting our continued business expansion.

Our research and development headcount increased by 22 from January 31, 2024 to January 31, 2025, primarily due to acquisitions.

We expect research and development expenses will decrease as a percentage of revenues as we leverage the investments we have made to date.

General and Administrative

General and administrative expenses decreased $6.8 million for fiscal 2024 compared to fiscal 2023, primarily due to a decrease of $3.5 million in third party professional fees, mostly attributable to decreases related to acquisition costs for SimpleNexus and fees and expenses related to other litigation expenses including a dismissed government antitrust investigation and related civil action (the "Antitrust Matters"), partially offset by the proposed settlement agreement for the related civil action of approximately $2.2 million, disclosed in Item 3 "Legal Proceedings" of Part I of this Annual Report on Form 10-K, and an increase in other professional fees.

The decrease in general and administrative spend also included a decrease of $3.4 million in personnel costs for fiscal 2024 compared to fiscal 2023, mostly attributable to a $1.2 million decrease in stock-based compensation expense, a decrease in average headcount, and a decrease in restructuring costs incurred in connection with the headcount reductions announced in January 2023, partially offset by compensation increases.

included in the decrease in general and administrative expenses was a decrease of $0.5 million in travel-related costs, offset by an increase of $0.5 million in allocated overhead and other general and administrative costs.

Our general and administrative headcount decreased by 26 from January 31, 2023 to January 31, 2024, primarily due to our workforce reduction announced in January 2023.

General and administrative expenses increased $13.5 million for fiscal 2025 compared to fiscal 2024, primarily due to an increase of $9.8 million in personnel costs, mostly attributable to a $6.8 million increase in stock-based compensation expense, and an increase in headcount.

The increase in general and administrative expenses also included an increase of $5.2 million in third-party professional fees, mostly attributable to an increase for acquisition-related expenses for fiscal 2025 acquisitions offset by a decrease in litigation expenses and other professional fees.

The increase in general and administrative spend was partially offset by a decrease of $1.6 million in allocated overheard and other general and administrative costs.

Our general and administrative headcount increased by 18 from January 31, 2024 to January 31, 2025, primarily due to acquisitions.

We expect general and administrative expenses will decrease as a percentage of revenues as we leverage the investments we have made to date.

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Other expense, net (856) (0.2) (10,427) (1.9)

Interest income increased $2.2 million for fiscal 2024 compared to fiscal 2023, due to increase in our accounts earning interest and increased interest rates.

Interest expense increased $1.3 million for fiscal 2024 compared to fiscal 2023, due to borrowing on our revolving credit facility and an increase in our financing obligations for leases for which we are considered the owners for accounting purposes.

The decrease of $0.5 million in other expense, net was primarily driven by intercompany loans and transactions that are denominated in currencies other than the underlying functional currency of the applicable entity.

Income Tax Provision

Interest income decreased $0.8 million for fiscal 2025 compared to fiscal 2024, due to the mix of our accounts earning interest and interest rates.

Interest expense increased $4.6 million for fiscal 2025 compared to fiscal 2024, due to borrowing on our revolving credit facility.

The increase of $9.6 million in other expense, net was primarily driven by intercompany loans and transactions that are denominated in currencies other than the underlying functional currency of the applicable entity resulting in remeasurement losses.

Income Tax Provision (Benefit)

Fiscal Year Ended January 31,

($ in thousands) 2024 2025

Income tax provision $ 4,071 1.0 % $ 1,590 0.3 %

Income tax provision was $1.6 million for fiscal 2024 compared to a provision of $4.1 million for fiscal 2023 and resulted in an effective tax rate of (3.8)% compared to (4.2)% in the prior fiscal year.

Income tax provision (benefit) $ 1,590 0.3 % $ (2,511) (0.5) %

Income tax benefit was $2.5 million for fiscal 2025 compared to a provision of $1.6 million for fiscal 2024 and resulted in an effective tax rate of 7.1% compared to (3.8)% in the prior fiscal year.

See Note 11 "Income Taxes" of the notes to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K for further details on the components of income tax and a reconciliation of the U.S.

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It is determined by management when a valuation allowance should be recorded, utilizing significant judgement and the use of estimates.

In fiscal 2024, based on all available positive and negative evidence, having demonstrated sustained profitability and cumulative pre-tax book income for the past three years, which is objective and verifiable, we have concluded that it is more likely than not that our United Kingdom deferred tax assets will be realizable.

We released $3.7 million of our valuation allowance in fiscal 2024 and will continue to monitor the need for a valuation allowance against our deferred tax assets on a quarterly basis.

We have adopted, as required, Code Section 174, as amended by the Tax Cuts and Jobs Act of 2017.

This will result in the repartition of our deferred tax asset balances from net operating losses and tax credit carryforwards to non-tax attribute deferred tax balances.

In addition, this may reduce our operating cash flows in future periods through cash remittances of U.S.

federal and state income tax.

We expect these changes to continue to impact our cash tax liability.

The Company regularly evaluates and continues to monitor the likelihood of outcomes resulting from legislation changes to determine the adequacy of our provision for income taxes.

In 2021, the Organization of Economic Cooperation and Development introduced its Pillar Two Framework Model Rules ("Pillar 2"), that was supported by over 130 countries worldwide, which is designed to impose a 15% global minimum tax on adjusted financial results.

Certain aspects of Pillar 2 took effect on January 1, 2024, while other aspects go into effect on January 1, 2025.

While many aspects of the application of Pillar 2 remain to be clarified, the Company does not expect Pillar 2 to impact its tax liability.

The company will continue to monitor and reflect the impact of such legislative changes in future financial statements as appropriate.

In fiscal year 2025, the Company acquired DocFox and recorded a net U.S.

deferred tax liability mostly related to identifiable intangible assets.

The deferred tax liability recognized provides additional positive evidence that a portion of the Company’s U.S.

deferred tax assets are realizable.

As a result, the Company reduced the historical valuation allowance in the U.S.

by $3.6 million.

Comparison of the Fiscal Years Ended January 31, 2023 and 2024

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Accordingly, we believe that this financial measure reflects our ongoing business in a manner that allows for meaningful comparisons and analysis of trends in the business and provides useful information to investors and others in understanding and evaluating our operating results, and enhancing the overall understanding of our past performance and future prospects.

Although the calculation of non-GAAP financial measures may vary from company to company, our detailed presentation may facilitate analysis and comparison of our operating results by management and investors with other peer companies, many of which use a similar non-GAAP financial measure to supplement their GAAP results in their public disclosures.

companies, many of which use a similar non-GAAP financial measure to supplement their GAAP results in their public disclosures.

This non-GAAP financial measure is non-GAAP operating income (loss), as discussed below.

Non-GAAP operating income (loss).

Non-GAAP operating income (loss) is defined as loss from operations as reported in our consolidated statements of operations excluding the impact of amortization of intangible assets, stock-based compensation expense, acquisition-related expenses, legal expenses related to certain litigation, and restructuring and related charges.

Non-GAAP operating income (loss) is defined as loss from operations as reported in our consolidated statements of operations excluding the following items:

Amortization of Purchased Intangibles.

nCino incurs amortization expense for purchased intangible assets in connection with certain mergers and acquisitions.

Because these costs have already been incurred, cannot be recovered, are non-cash, and are affected by the inherent subjective nature of purchase price allocations, nCino excludes these expenses for our internal management reporting processes.

nCino’s management also finds it useful to exclude these charges when assessing the appropriate level of various operating expenses and resource allocations when budgeting, planning and forecasting future periods.

Although nCino excludes amortization expense for purchased intangibles from these non-GAAP measures, management believes it is important for investors to understand that such intangible assets were recorded as part of purchase accounting and contribute to revenue generation.

Stock-Based Compensation Expense.

nCino excludes stock-based compensation expenses primarily because they are non-cash expenses that nCino excludes from our internal management reporting processes.

nCino’s management also finds it useful to exclude these expenses when they assess the appropriate level of various operating expenses and resource allocations when budgeting, planning and forecasting future periods.

Moreover, because of varying available valuation methodologies, subjective assumptions and the variety of award types that companies can use, nCino believes excluding stock-based compensation expenses allows investors to make meaningful comparisons between our recurring core business operating results and those of other companies.

Acquisition Related Expenses.

nCino excludes expenses related to acquisitions as they limit comparability of operating results with prior periods.

Acquisition-related expenses, include but are not limited to, costs incurred from third-party professional services firms in connection with business combination and one-time integration activities.

We believe these costs are non-recurring in nature and outside the ordinary course of business.

Litigation Expenses .

nCino excludes fees and expenses related to certain litigation expenses incurred from legal matters outside the ordinary course of our business as we believe their exclusion from non-GAAP operating expenses will facilitate a more meaningful explanation of operating results and comparisons with prior period results.

Restructuring Costs.

nCino excludes costs incurred related to bespoke restructuring plans and other one-time costs that are fundamentally different in strategic nature and frequency from ongoing initiatives.

We believe excluding these costs facilitates a more consistent comparison of operating performance over time.

See Note 18 "Restructuring" of the notes to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K for more information on the charges related to the restructuring.

Non-GAAP operating income (loss) is widely used by securities analysts, investors, and other interested parties to evaluate the profitability of companies.

Non-GAAP operating income (loss) eliminates potential differences in performance caused by these items that are not indicative of the Company's ongoing operating performance and hinders comparability with prior and future performance.

This non-GAAP financial measure does not replace the presentation of our GAAP financial results and should only be used as a supplement to, not as a substitute for, our financial results presented in accordance with GAAP.

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Non-GAAP operating income (loss) $ (2,141) $ 61,779 $ 96,165

1 Represents legal expenses related to the Antitrust Matters and a shareholder derivative lawsuit.

1 Represents legal expenses related to a closed government antitrust investigation and related civil action and a dismissed shareholder derivative lawsuit.

2 Stock-based compensation benefit of $0.2 million related to restructuring is included on the stock-based compensation expense line item for the fiscal year ended January 31, 2023.

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As of January 31, 2025, we had $120.9 million in cash and cash equivalents, and an accumulated deficit of $385.3 million.

Our net losses have been driven by our investments in developing the nCino Bank Operating System and scaling our sales and marketing organization and finance and administrative functions to support our rapid growth.

To date, we have funded our capital needs through issuances of common stock including our initial public offering in July 2020, operating cash flows, and during fiscal 2023, our revolving line of credit.

Our net losses have been driven by our investments in developing the nCino Platform and scaling our sales and marketing organization and finance and administrative functions to support our rapid growth.

To date, we have funded our capital needs through issuances of common stock including our initial public offering in July 2020, operating cash flows, and our revolving line of credit.

We generally bill and collect from our customers annually in advance.

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Because we recognize revenues ratably, our deferred revenue balance mirrors the seasonality of our billings.

As of January 31, 2024, the Company had no amounts outstanding, no letters of credit issued under the Credit Facility, was in compliance with all covenants and had borrowing availability of $50.0 million.

As of January 31, 2025, the Company had $166.0 million outstanding, no letters of credit issued under the 2024 Credit Facility, was in compliance with all covenants and had borrowing availability of $84.0 million.

On March 17, 2024, the Company entered into the Second Amendment for the 2022 Credit Facility which, among other things, increased our borrowing availability to $100.0 million.

In March 2024, we borrowed $75.0 million under the 2022 Credit Facility to fund the acquisition of DocFox.

The interest rate at the time of borrowing was 7.36%.

Following the acquisition, we had borrowing availability of $25.0 million.

See Note 15 "Revolving Credit Facility" and Note 20 "Subsequent Events" of the notes to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K for more information.

On October 28, 2024, the Company entered into the 2024 Credit Facility, which increased our borrowing availability to $250.0 million.

The Company borrowed $166.0 million under the 2024 Credit Facility to fund the acquisition of FullCircl and pay the outstanding amount under the 2022 Credit Facility.

The Company expects to pay an additional $15.0 million in two years for the FullCircl acquisition upon the satisfaction and performance of certain warranties and covenants.

During fiscal 2025, we repaid $75.0 million on the 2022 and 2024 Credit Facilities.

As of January 31, 2025, the applicable interest rate was 6.31%.

See Note 14 "Revolving Credit Facility" of the notes to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K for more information.

In February 2025, the Company borrowed an additional $52.5 million on the 2024 Credit Facility to fund an acquisition and in March 2025 the Company repaid $50.0 million on the 2024 Credit Facility, see Note 20 "Subsequent Events" for additional information.

We believe that current cash and cash equivalents as well as borrowings available under the 2024 Credit Facility will be sufficient to fund our operations and capital requirements for at least the next 12 months.

Our future capital requirements will depend on many factors, including our growth rate, the timing and extent of spending to support research and development efforts to enhance the nCino Bank Operating System and introduce new applications, market acceptance of our solutions, the continued expansion of our sales and marketing activities, capital expenditure requirements, and any potential future acquisitions.

Our future capital requirements will depend on many factors, including our growth rate, the timing and extent of spending to support research and development efforts to enhance the nCino Platform and introduce new solutions, market acceptance of our solutions, the continued expansion of our sales and marketing activities, capital expenditure requirements, and any potential future acquisitions.

We expect capital expenditures will be appreciably higher in absolute dollars in fiscal 2026 for planned office build-outs, mainly for an international office, compared to prior fiscal years to accommodate our growth, which we estimate to be approximately $8.4 million.

We may from time-to-time seek to raise additional capital to support our growth.

Any equity financing we may undertake could be dilutive to our existing stockholders, and any debt financing we may undertake could require debt service and financial and operational covenants that could adversely affect our business.

Any equity financing we may undertake could be dilutive to our existing stockholders, and any debt financing we may undertake could

require debt service and financial and operational covenants that could adversely affect our business.

There is no assurance we would be able to obtain future financing on acceptable terms or at all.

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since its inception.

Pursuant to an agreement with the holders of the non-controlling interest in nCino

K.K., beginning in 2027 we may redeem the non-controlling interest, or be required to redeem such interest by the holders thereof, based on a prescribed formula derived from the relative revenues of nCino K.K.

Pursuant to an agreement with the holders of the non-controlling interest in nCino K.K., beginning in 2027 we may redeem the non-controlling interest, or be required to redeem such interest by the holders thereof, based on a prescribed formula derived from the relative revenues of nCino K.K.

and the Company.

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As of January 31, 2024 and January 31, 2025, the redeemable non-controlling interest was $3.4 million and $8.3 million, respectively.

As part of our joint venture obligations, we made an additional cash capital contribution of $1.0 million to nCino K.K.

during the third quarter of fiscal 2024.

Summary Cash Flow information for fiscal 2023, 2024, and 2025 are set forth below.

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Net cash provided by (used in) financing activities 36,712 (21,113) 170,478

Net Cash Provided by (Used in) Operating Activities

The $57.3 million provided by operating activities in fiscal 2024 reflects our net loss of $43.5 million and $16.4 million used in changes in working capital accounts, offset by $117.2 million in non-cash charges.

Net Cash Provided by Operating Activities

The $55.2 million of net cash provided by operating activities in fiscal 2025 reflects our net loss of $33.0 million and $38.5 million used in changes in working capital accounts, offset by $126.7 million in non-cash charges.

Non-cash charges primarily consisted of stock-based compensation, depreciation and amortization, amortization of costs capitalized to obtain revenue contracts, foreign currency losses related to intercompany loans and transactions, deferred income taxes, and non-cash operating lease costs.

Cash used in working capital accounts was principally a function of a $31.4 million increase in accounts receivable due to the timing of billings and collections from customers, an increase of $21.5 million of capitalized costs to obtain revenue contracts, which consisted primarily of sales commissions, a $7.1 million increase in prepaid expenses and other assets, a decrease of $3.8 million in operating lease liabilities, and a $0.2 million decrease in accounts payable.

The cash used in working capital accounts was partially offset by a $13.8 million increase in deferred revenue, as we expanded our customer base and renewed existing customers, a $10.2 million increase in accrued expenses and other current liabilities primarily due to acquisition costs and compensation, and a $1.4 million increase in other long-term liabilities.

The $57.3 million of net cash provided by operating activities in fiscal 2024 reflects our net loss of $43.5 million and $16.4 million used in changes in working capital accounts, partially offset by $117.2 million in non-cash charges.

Non-cash charges primarily consisted of stock-based compensation, depreciation and amortization, amortization of costs capitalized to obtain revenue contracts, non-cash operating lease costs, deferred income taxes, provision for bad debt, foreign currency losses related to intercompany loans and transactions, and an unrealized gain on investment.

Cash used in working capital accounts was principally a function of a $14.3 million increase in accounts receivable due to the timing of billings and collections from customers, payments of $10.3 million of capitalized costs to obtain revenue contracts, which consisted primarily of sales commissions, a $6.0 million decrease in accrued expenses and other current liabilities which includes payments of approximately $5.0 million for severance and other employee costs associated with the restructuring plan and changing commission payment plans from a quarterly basis to a monthly basis, and a decrease of $4.1 million in operating lease liabilities.

Cash used in working capital accounts was principally a function of a $14.3 million increase in accounts receivable due to the timing of billings and collections from customers, an increase of $10.3 million of capitalized costs to obtain revenue contracts, which consisted primarily of sales commissions, a $6.0 million decrease in accrued expenses and other current liabilities which includes payments of approximately $5.0 million for severance and other employee costs associated with the restructuring plan and changing commission payment plans from a quarterly basis to a monthly basis, and a decrease of $4.1 million in operating lease liabilities.

The cash used in working capital accounts was partially offset by a $15.9 million increase in deferred revenue, as we expanded our customer base and renewed existing customers, a $1.9 million decrease in prepaid expenses and other assets, and a $0.5 million increase in accounts payable.

The $15.4 million used in operating activities in fiscal 2023 reflects our net loss of $101.8 million and $14.9 million used in changes in working capital accounts, partially offset by $101.3 million in non-cash charges.

Non-cash charges primarily consisted of stock-based compensation, depreciation and amortization, amortization of costs capitalized to obtain revenue contracts, non-cash operating lease costs, foreign currency losses related to intercompany loans and transactions, deferred income taxes, and provision for bad debt.

Cash used in working capital accounts was principally a function of a $26.8 million increase in accounts receivable due to the timing of billings and collections from customers, an increase of $12.2 million of capitalized costs to obtain revenue contracts, which primarily related to payments for sales commissions as we expanded our customer base, a decrease of $4.8 million in operating lease liabilities, a $3.4 million increase in prepaid expenses and other assets, and a $1.2 million decrease in accrued expenses and other current liabilities.

The cash used in working capital accounts was partially offset by a $33.5 million increase in deferred revenue, as we expanded our customer base and renewed existing customers.

Net Cash Used in Investing Activities

The $6.3 million used in investing activities in fiscal 2024 was comprised of $3.5 million used for the purchase of property and equipment and leasehold improvements to support the expansion of our business, $2.5 million used for the purchase of preferred stock in Rich Data Co, and $0.4 million for the final cash considerations relating to an asset acquisition completed in August 2022.

The $20.7 million used in investing activities in fiscal 2023 was comprised of $18.3 million used for the purchase of property and equipment and the completion of leasehold improvements to our additional headquarter building to support the expansion of our business, $2.5 million used for the purchase of preferred stock in Zest AI, and $0.6 million for

an asset acquisition completed in August 2022.

The cash used in investing activities was partially offset by $0.7 million received for a net working capital adjustment from our SimpleNexus acquisition.

The $219.2 million of net cash used in investing activities in fiscal 2025 was comprised of $216.9 million used for the acquisition of DocFox, ILT, and FullCircl, $1.8 million for the purchase of property and equipment and leasehold

improvements to support the expansion of our business, and $0.5 million for the acquisition of certain technology.

The $6.3 million of net cash used in investing activities in fiscal 2024 was comprised of $3.5 million used for the purchase of property and equipment to support the expansion of our business, $2.5 million used for the purchase of preferred stock in Rich Data Co, and $0.4 million for an asset acquisition completed in August 2022.

Net Cash Provided by (Used in) Financing Activities

The $21.1 million used in financing activities in fiscal 2024 was comprised principally of payments of $30.0 million on the Credit Facility and principal payments of $1.2 million on financing obligations.

The cash used in financing activities was partially offset by $4.7 million of proceeds from stock issuances under the employee stock purchase plan, $4.5 million of proceeds from the exercise of stock options, and $1.0 million in proceeds from the non-controlling interest in our Japan joint venture.

The $36.7 million provided by financing activities in fiscal 2023 was comprised principally of $50.0 million of proceeds from borrowings on the Credit Facility to expand our liquidity, $4.5 million in proceeds from stock issuances under the employee stock purchase plan, and $3.8 million of proceeds from the exercise of stock options.

The cash provided by financing activities was partially reduced by payments of $20.0 million on the Credit Facility, principal payments of $1.1 million on the financing obligations, and payments of debt issuance costs of $0.4 million.

The $170.5 million of net cash provided by financing activities in fiscal 2025 was comprised principally of $241.0 million proceeds from borrowings on the 2022 and 2024 Credit Facility to fund the acquisitions of DocFox and FullCircl, $4.5 million of proceeds from stock issuances under the employee stock purchase plan, and $2.8 million of proceeds from the exercise of stock options.

The cash provided by financing activities was partially offset by payments of $75.0 million on the 2022 Credit Facility, payments of debt issuance costs of $1.5 million, and principal payments of $1.3 million on financing obligations.

The $21.1 million of net cash used in financing activities in fiscal 2024 was comprised principally of payments of $30.0 million on the Credit Facility and principal payments of $1.2 million on the financing obligations.

The cash used in financing activities was partially offset by $4.7 million in proceeds from stock issuances under the employee stock purchase plan, $4.5 million of proceeds from the exercise of stock options, and $1.0 million in proceeds from the non-controlling interest in our Japan joint venture.

Contractual Obligations and Commitments

Our estimated future obligations principally consist of leases related to our facilities, purchase obligations related primarily to licenses and hosting services, financing obligations for leases for which we are considered the owners for accounting purposes, and the Credit Facility.

See Note 14 "Leases," Note 15 "Revolving Credit Facility," and Note 16 "Commitments and Contingencies" of the notes to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K for more information.

Our estimated future obligations principally consist of an indemnity holdback associated with a business combination, leases related to our facilities, purchase obligations related primarily to licenses and hosting services, financing obligations for leases for which we are considered the owners for accounting purposes, and the Credit Facility.

See Note 6 "Business Combinations," Note 13 "Leases," Note 14 "Revolving Credit Facility," and Note 15 "Commitments and Contingencies" of the notes to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K for more information.

Critical Accounting Policies and Estimates

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Accordingly, these are the policies we believe are the most critical to aid in fully understanding and evaluating our consolidated financial condition and results of our operations.

See Note 2 "Summary of Significant Accounting Policies" of the notes to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K, for a description of our other significant accounting policies.

See Note 1 "Summary of Business and Significant Accounting Policies" of the notes to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K, for a description of our other significant accounting policies.

The preparation of our consolidated financial statements in conformity with accounting principles generally accepted in the U.S.

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Arrangements with customers do not provide the customer with the right to take possession of the software supporting the cloud-based application service at any time and, as a result, are accounted for as a service contract.

Generally, our subscription contracts for the nCino Bank Operating System are three years or longer in length, billed annually in advance, are non-cancelable, and do not contain refund-type provisions.

Subscription contracts for nCino Mortgage typically range from one to three years and are generally billed monthly in advance.

Subscription arrangements for the nCino Bank Operating System that are cancelable generally have penalty clauses.

Generally, our subscription contracts are three to five years in length, billed annually in advance, are non-cancelable, and do not contain refund-type provisions.

mortgage contracts are generally billed monthly in advance.

Subscription arrangements that are cancelable generally have penalty clauses.

Professional Services and Other Revenues

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We use our best estimates and assumptions to assign fair value to tangible and intangible assets acquired and liabilities assumed at the acquisition date.

The estimates of fair value require management to make estimates of, among other things, future expected cash flows, obsolescence life and factor, and discount rates.

We determine the fair value of intangible assets acquired in consultation with third-party valuation advisors.

The excess of the purchase price over the fair value of net assets acquired is recorded as goodwill.

The determination of fair value requires management to make significant estimates, particularly with respect to intangible assets.

These estimates can include, but are not limited to:

• future expected cash flows from subscriptions contracts and acquired developed technologies;

• historical and expected customer attrition rates and anticipated growth in revenue from acquired customers;

• royalty rates applied to acquired developed technology platforms and other intangible assets;

• assumptions about the period of time and intended use of acquired intangible assets;

• discount rates;

• uncertain tax positions and tax related valuation allowances

While we use our best estimates and assumptions, our estimates are inherently uncertain and subject to refinement.

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Determining the useful life of an intangible asset also requires judgment as different types of intangible assets have different lives.

Accrued income taxes are reported as a component of either accounts receivable or other accrued liabilities, as appropriate, in our consolidated balance sheets and reflect our estimate of income taxes to be paid or received.

Accrued income taxes are reported as a component of either prepaid expenses and other current assets or accrued expenses and other current liabilities, as appropriate, in our consolidated balance sheets and reflect our estimate of income taxes to be paid or received.

Deferred income taxes represent the amount of future income taxes to be paid or refunded and are accounted for using the asset and liability method.

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Due to the complexity of any uncertainty, the ultimate resolution may result in a remittance that is different from the current estimate of any tax liabilities.

Change in Accounting Estimate

See Note 8 "Goodwill and Intangible Assets" of the notes to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K for a change in estimate related to the useful life of the SimpleNexus trade name during the third quarter of fiscal 2024.

Recent Accounting Pronouncements

See Note 2 "Summary of Significant Accounting Policies" of the notes to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K for recently adopted accounting pronouncements and recently issued accounting pronouncements not yet adopted, if applicable.

See Note 1 "Summary of Business and Significant Accounting Policies" of the notes to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K for recently adopted accounting pronouncements and recently issued accounting pronouncements not yet adopted, if applicable.

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

What changed 10-K

Item 7. Management’s Discussion and Analysis