What changed in this filing

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Item 2. Management’s Discussion and Analysis

2025-08-26 compared with 2025-05-28 · 139 added, 93 removed, 323 unchanged (42% of the section changed)

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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.

nCino's trusted platform enables FIs to consolidate vendors while optimizing operations by integrating artificial intelligence ("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.

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• improve efficiency,

• elevate employee and customer experience, and

• elevate employee and customer experiences, and

• manage risk and help 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 are dealing with the same problems—cumbersome legacy technology, fragmented data, disconnected business functions, and a disengaged workforce that 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.

After realizing that virtually all banks and credit unions face the same problems—cumbersome legacy technology, fragmented data, disconnected business functions, and a disengaged workforce which 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 U.S.

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

As of April 30, 2025, we had 191 sales and sales support personnel in the U.S.

As of July 31, 2025, we had 177 sales and sales support personnel in the U.S.

and 126 sales and support personnel in offices outside the U.S.

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In March 2025, our Board of Directors authorized a stock repurchase program of up to $100.0 million of our outstanding common stock.

During the three months ended April 30, we repurchased 1.8 million shares of our outstanding common stock for $40.6 million, excluding transaction costs and excise tax associated with the repurchases, if any.

As of April 30, 2025, $59.4 million remained available for future repurchases under the share repurchase program.

During the three and six months ended July 31, 2025, we repurchased 0.7 million and 2.6 million shares of our outstanding common stock for $20.0 million and $60.5 million, respectively, excluding transaction costs and excise tax associated with the repurchases, if any.

As of July 31, 2025, $39.5 million remained available for future repurchases under the share repurchase program.

See Note 8 "Stockholders' Equity" of the notes to our unaudited condensed consolidated financial statements included in Part I, Item I of this Quarterly Report on Form 10-Q for more information.

We funded the purchase of Sandbox Banking and our share repurchases primarily through borrowings under our credit facility.

For the three months ended April 30, 2024 and 2025, our total revenues were $128.1 million and $144.1 million, respectively, representing a 12.5% increase.

For the three months ended April 30, 2024 and 2025, our subscription revenues were $110.4 million and $125.6 million, respectively, representing a 13.8% increase.

Our total subscriptions revenues include an aggregate of $7.4 million from DocFox, ILT, FullCircl and Sandbox Banking for the three months ended April 30, 2025.

We recorded net income attributable to nCino, Inc.

of $5.6 million for the three months ended April 30, 2025, compared to a net (loss) attributable to nCino, Inc.

of $(3.0) million for the three months ended April 30, 2024.

On May 27, 2025, we announced the “Restructuring Plan” in furtherance of our efforts to improve operational efficiencies.

We incurred charges in the second quarter of our fiscal 2026 of $10.1 million in connection with the Restructuring Plan.

See Note 15 "Restructuring" of the notes to our consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q for additional information.

For the three months ended July 31, 2024 and 2025, our total revenues were $132.4 million and $148.8 million, respectively, representing a 12.4% increase.

For the three months ended July 31, 2024 and 2025, our subscription revenues were $113.9 million and $130.8 million, respectively, representing a 14.8% increase.

We recorded net loss attributable to nCino, Inc.

of $15.3 million for the three months ended July 31, 2025, compared to a net loss attributable to nCino, Inc.

of $11.0 million for the three months ended July 31, 2024.

For the six months ended July 31, 2024 and 2025, our total revenues were $260.5 million and $293.0 million, respectively, representing a 12.5% increase.

For the six months ended July 31, 2024 and 2025, our subscription revenues were $224.3 million and $256.3 million, respectively, representing a 14.3% increase.

We recorded net loss attributable to nCino, Inc.

of $9.7 million for the six months ended July 31, 2025, compared to a net loss attributable to nCino, Inc.

of $14.0 million for the six months ended July 31, 2024.

Our total subscription revenues include an aggregate of $5.5 million from FullCircl and Sandbox Banking for the three months ended July 31, and $10.9 million for the six

months ended July 31, 2025.

We have included the financial results of Sandbox Banking in the unaudited condensed consolidated financial statements from the Sandbox Acquisition Date.

For fiscal 2026, our financial results also include the operating results of our fiscal 2025 acquisitions of DocFox, ILT, and FullCircl from their acquisition dates of March 20, 2024, April 1, 2024, and November 5, 2024, respectively.

On May 27, 2025, the Company announced a workforce reduction of approximately seven percent (7%) and office space reductions in certain markets.

See Note 15 "Subsequent Events" of the notes to our unaudited condensed consolidated financial statements included in Part I, Item I of this Quarterly Report on Form 10-Q for more information.

Factors Affecting Our Operating Results

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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 21.9% of total revenues for the three months ended April 30, 2025.

In addition, growing our customer base will require us to increasingly penetrate markets outside the U.S., which accounted for 22.5% of total revenues for the three months ended July 31, 2025 and 22.2% for the six months ended July 31, 2025.

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

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Sales and marketing expenses consist primarily of personnel costs of our sales and marketing employees, including salaries, sales commissions and incentives, benefits and stock-based compensation expense, travel and related costs.

We capitalize incremental costs incurred to obtain contracts, primarily consisting of sales commissions, and subsequently amortize these costs over the expected period of benefit, which we have determined to be approximately four years.

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.

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Interest expense consists primarily of interest related to our financing obligations along with interest expense on borrowings, commitment fees, and amortization of debt issuance costs associated with our secured revolving credit facility.

Also included is interest expense accretion for a deferred payment on the acquisition of FullCircl.

Other Income (Expense), Net.

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The results of operations presented below should be reviewed in conjunction with the financial statements and notes included elsewhere in this Quarterly Report on Form 10-Q.

The following tables present our selected unaudited condensed consolidated statements of operations data for three months ended April 30, 2024 and 2025 in both dollars and as a percentage of total revenues, except as noted.

Three Months Ended April 30,

The following tables present our selected unaudited condensed consolidated statements of operations data for three and six months ended July 31, 2024 and 2025 in both dollars and as a percentage of total revenues, except as noted.

Three Months Ended July 31, Six Months Ended July 31,

($ in thousands)

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Other income (expense), net 150 717 (594) 16,814

Net income (loss) before income taxes (5,279) 10,551

Loss before income taxes (9,270) (12,510) (14,549) (1,959)

Income tax provision (benefit) 1,753 1,209 (1,229) 5,743

Net income (loss) (2,297) 6,017

Net loss (11,023) (13,719) (13,320) (7,702)

Net income (loss) attributable to redeemable non-controlling interest (58) (74) (223) 2

Adjustment attributable to redeemable non-controlling interest 75 1,612 919 1,991

Net income (loss) attributable to nCino, Inc.

Net loss attributable to nCino, Inc.

$ (11,040) $ (15,257) $ (14,016) $ (9,695)

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The Company recognized stock-based compensation expense as follows:

Three Months Ended April 30,

Three Months Ended July 31, Six Months Ended July 31,

($ in thousands) 2024 2025 2024 2025

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The Company recognized amortization expense for intangible assets as follows:

Three Months Ended April 30,

Three Months Ended July 31, Six Months Ended July 31,

($ in thousands) 2024 2025 2024 2025

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Total amortization expense $ 7,349 $ 9,241 $ 14,031 $ 18,430

Three Months Ended April 30,

Three Months Ended July 31, Six Months Ended July 31,

2024 2025 2024 2025

Subscription revenues 86.0 % 87.9 % 86.1 % 87.5 %

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Other income (expense), net 0.1 0.5 (0.2) 5.7

Net income (loss) before income taxes (4.2) 7.4

Loss before income taxes (7.1) (8.4) (5.6) (0.7)

Income tax provision (benefit) 1.3 0.8 (0.5) 2.0

Net income (loss) (1.9) % 4.3 %

Comparison of the Three Months Ended April 30, 2024 and 2025

Three Months Ended April 30,

Net loss (8.4) % (9.2) % (5.1) % (2.7) %

Comparison of the Three and Six Months Ended July 31, 2024 and 2025

Three Months Ended July 31, Six Months Ended July 31,

($ in thousands) 2024 2025 2024 2025

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Subscription Revenues

Subscription revenues increased $15.2 million for the three months ended April 30, 2025 compared to the three months ended April 30, 2024, 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.

Of the increase, 53.0% was attributable to initial revenues from customers who did not contribute to subscription revenues during the three months ended April 30, 2024 and 47.0% was attributable to increased revenues from existing customers as customers expanded their use and adoption of our solutions.

Subscription revenues were 87.1% of total revenues for the three months ended April 30, 2025 compared to 86.2% of total revenues for the three months ended April 30, 2024, primarily due to growth in our installed base.

Subscription revenues increased $16.8 million for the three months ended July 31, 2025 compared to the three months ended July 31, 2024, primarily attributable 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.

Of the increase, 51.7% was attributable to increased revenues from existing customers as customers expanded their use and adoption of our solutions, and 48.3% was attributable to initial revenues from customers who did not contribute to subscription revenues during the three months ended July 31, 2024.

Subscription revenues were 87.9% of total revenues for the three months ended July 31, 2025 compared to 86.0% of total revenues for the three months ended July 31, 2024, primarily due to growth in our installed base.

Subscription revenues increased $32.0 million for the six months ended July 31, 2025 compared to the six months ended July 31, 2024, primarily attributable 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.

Of the increase, 51.1% was attributable to increased revenues from existing customers as customers expanded their use and adoption of our solutions, and 48.9% was attributable to initial revenues from customers who did not contribute to subscription revenues during the six months ended July 31, 2024.

Subscription revenues were 87.5% of total revenues for the six months ended July 31, 2025 compared to 86.1% of total revenues for the six months ended July 31, 2024, primarily due to growth in our installed base.

Professional Services and Other Revenues

Professional services and other revenues increased $0.9 million for the three months ended April 30, 2025 compared to the three months ended April 30, 2024, primarily due to the addition of new customers as well as expanded adoption by existing customers within and across lines of business where implementation, configuration, and training services were required.

Professional services and other revenues decreased $(0.4) million for the three months ended July 31, 2025 compared to the three months ended July 31, 2024, primarily attributable to the mix of solutions being implemented and certain markets yielding lower effective bill rates.

Professional services and other revenues increased $0.4 million for the six months ended July 31, 2025 compared to the six months ended July 31, 2024, primarily attributable to the mix of solutions being implemented.

Cost of Revenues and Gross Margin

Three Months Ended April 30,

Three Months Ended July 31, Six Months Ended July 31,

($ in thousands) 2024 2025 2024 2025

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Cost of Subscription Revenues

Cost of subscription revenues increased $4.3 million for the three months ended April 30, 2025 compared to the three months ended April 30, 2024, generating a gross margin for subscription revenues of 71.2% for the three months ended April 30, 2024 and 2025.

The increase was driven primarily by a $3.1 million increase in other data costs, as well as a $0.9 million increase in amortization expense related to acquired intangible assets.

Cost of subscription revenues increased $4.6 million for the three months ended July 31, 2025 compared to the three months ended July 31, 2024, generating a gross margin for subscription revenues of 70.9% compared to a gross margin of

70.7% for the three months ended July 31, 2024.

The dollar increase was primarily attributable to a $2.4 million increase in other data costs and a $0.4 million increase in costs related to Salesforce user fees as we continued to add new customers and sell additional functionality to existing customers.

The increase in cost of subscription revenues also included a $1.1 million increase in personnel costs due to restructuring costs incurred in connection with the Restructuring Plan and compensation increases.

The increase in cost of subscription revenues also included a $0.7 million increase in amortization expense related to acquired intangible assets.

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 subscription revenues increased $9.0 million for the six months ended July 31, 2025 compared to the six months ended July 31, 2024, generating a gross margin for subscription revenues of 71.1% compared to a gross margin of 71.0% for the six months ended July 31, 2024.

The dollar increase was primarily attributable to a $5.5 million increase in other data costs and a $0.4 million increase in costs related to Salesforce user fees 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 $1.7 million in amortization expense related to acquired intangible assets, as well as a $1.3 million increase in personnel costs due to restructuring costs incurred in connection with the Restructuring Plan and compensation increases.

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 $2.2 million for the three months ended April 30, 2025 compared to the three months ended April 30, 2024, generating a gross margin for professional services and other revenues of (16.3)% compared to a gross margin of (9.7)% for the three months ended April 30, 2024.

For the three months ended April 30, 2025, personnel costs increased $1.6 million for professional services compared to the three months ended April 30, 2024,

mainly from an increase in headcount, primarily due to acquisitions.

The increase in cost of professional services and other revenues also included a $0.4 million increase for third-party costs of professional services.

Cost of professional services and other revenues increased $2.1 million for the three months ended July 31, 2025 compared to the three months ended July 31, 2024, generating a gross margin for professional services and other revenues of (25.7)% compared to a gross margin of (11.2)% for the three months ended July 31, 2024.

For the three months ended July 31, 2025, personnel costs increased $1.8 million for professional services compared to the three months ended July 31, 2024, primarily attributable to increased headcount from acquisitions and restructuring costs incurred in connection with the Restructuring Plan.

The increase in cost of professional services and other revenues also included a $0.5 million increase in allocated overhead primarily attributable to internal investments in AI technology.

The decrease in our professional services and other gross margin for the three months ended July 31, 2025 was primarily attributable to strategic investments in expanding our professional service capabilities, coupled with lower effective billing and utilization rates.

Cost of professional services and other revenues increased $4.3 million for the six months ended July 31, 2025 compared to the six months ended July 31, 2024, generating a gross margin for professional services and other revenues of (20.9)% compared to a gross margin of (10.5)% for the six months ended July 31, 2024.

For the six months ended July 31, 2025, personnel costs, including stock-based compensation expense, increased $3.4 million for professional services compared to the six months ended July 31, 2024, mainly from an increase in headcount primarily due to acquisitions and restructuring costs incurred in connection with the Restructuring Plan.

The increase in cost of professional services and other revenues also included a $0.7 million increase in allocated overhead primarily attributable to internal investments in AI technology, as well as a $0.4 million increase for third-party services costs.

The decrease in our professional services and other gross margin for the six months ended July 31, 2025 was primarily attributable to strategic investments in expanding our professional service capabilities, coupled with lower effective billing and utilization rates.

Operating Expenses

Three Months Ended April 30,

Three Months Ended July 31, Six Months Ended July 31,

($ in thousands) 2024 2025 2024 2025

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Sales and Marketing

Sales and marketing expenses increased $4.9 million for the three months ended April 30, 2025 compared to the three months ended April 30, 2024, primarily attributable to an increase of $2.2 million in personnel costs driven by an increase in headcount, offset by a decrease of $1.0 million in stock-based compensation expense.

The increase in sales and marketing also included an increase of $1.7 million in allocated overhead, mostly attributable to a $1.6 million increase in amortization expenses for acquired intangible assets.

The increase in sales and marketing expenses also included an increase of $1.0 million in marketing costs.

Our sales and marketing headcount increased by 37 from April 30, 2024 to April 30, 2025, primarily due to acquisitions.

We expect sales and marketing expenses will increase as a percentage of revenues as we expand more into credit unions in the U.S.

Sales and marketing expenses increased $5.6 million for the three months ended July 31, 2025 compared to the three months ended July 31, 2024, primarily attributable to an increase of $2.8 million in personnel costs driven by an increase in headcount, mainly attributable to acquisitions, and restructuring costs incurred with the Restructuring Plan, partially offset by a decrease of $0.4 million in stock-based compensation expense.

The increase in sales and marketing expenses also included an

increase of $1.5 million in marketing costs, and a $1.5 million increase in allocated overhead, mostly attributable to a $1.2 million increase in amortization expenses for acquired intangible assets.

The increase in sales and marketing expenses was also partially offset by a $0.3 million decrease in third-party professional fees.

Sales and marketing expenses increased $10.5 million for the six months ended July 31, 2025 compared to the six months ended July 31, 2024, primarily attributable to an increase of $5.0 million in personnel costs driven by an increase in headcount, mainly attributable to acquisitions, and restructuring costs incurred in connection with the Restructuring Plan, as well as compensation increases, partially offset by a $1.5 million decrease in stock-based compensation expense.

The increase in sales and marketing expenses also included an increase of $3.2 million in allocated overhead, mostly attributable to a $2.7 million increase in amortization expenses for acquired intangible assets, and a $2.5 million increase in in marketing costs.

The increase in sales and marketing expenses was partially offset by a decrease of $0.4 million in third-party professional services.

Sales and marketing headcount increased by 15 from July 31, 2024 to July 31, 2025, primarily attributable to acquisitions and net of restructuring.

We expect sales and marketing expenses will increase as a percentage of total revenues as we expand into credit unions in the U.S.

and on the European continent.

Research and Development

Research and development expenses increased $3.4 million for the three months ended April 30, 2025 compared to the three months ended April 30, 2024, primarily due to an increase of $2.7 million in personnel costs, mainly from an increase in headcount.

Our research and development headcount increased by 52 from April 30, 2024 to April 30, 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.

Research and development expenses increased $0.4 million for the three months ended July 31, 2025 compared to the three months ended July 31, 2024, primarily attributable to an increase of $0.8 million in allocated overhead for internal investments in AI technology.

The increase in research and development also included an increase of $0.6 million in personnel costs due to restructuring costs incurred in connection with the Restructuring Plan, partially offset by a $1.6 million decrease in stock-based compensation expense.

The increase in research and development was partially offset by a decrease of $0.8 million in third-party professional fees.

Research and development expenses increased $3.8 million for the six months ended July 31, 2025 compared to the six months ended July 31, 2024, primarily attributable to an increase of $3.3 million in personnel costs, mostly attributable to restructuring costs incurred in connection with the Restructuring Plan, partially offset by a $1.7 million decrease in stock-based compensation expense.

The increase in research and development also included an increase of $1.0 million in allocated overhead primarily attributable to internal investments in AI technology.

The increase in research and development was partially offset by a decrease of $0.6 million in third-party professional fees.

Research and development headcount decreased by 33 from July 31, 2024 to July 31, 2025, primarily attributable to the Restructuring Plan.

We expect research and development expenses will decrease as a percentage of total revenues as we leverage our existing technology investments.

General and Administrative

General and administrative expenses decreased $0.9 million for the three months ended April 30, 2025 compared to the three months ended April 30, 2024, primarily due to a decrease of $3.1 million in third-party professional fees, mostly attributable to a decrease in acquisition-related expenses and a decrease in other professional fees.

The decrease in general and administrative spend was partially offset by an increase of $1.5 million in personnel costs, mostly attributable to a $0.7 million increase in stock-based compensation expense and headcount.

The decrease in general and administrative expenses was also partially offset by an increase of $0.6 million in allocated overhead and other general and administrative costs.

Our general and administrative headcount increased by 9 from April 30, 2024 to April 30, 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.

General and administrative expenses increased $5.1 million for the three months ended July 31, 2025 compared to the three months ended July 31, 2024, primarily attributable to an increase of $2.3 million in restructuring costs for exit costs and asset write-offs associated with the Restructuring Plan.

The increase in general and administrative expenses also included an increase of $2.3 million in personnel costs, driven by $1.1 million in restructuring costs for severance incurred in connection with the Restructuring Plan and a $1.4 million increase in stock-based compensation expense.

General and administrative expenses increased $4.2 million for the six months ended July 31, 2025 compared to the six months ended July 31, 2024, primarily attributable to an increase of $3.8 million in personnel costs, driven by $1.1 million in restructuring costs for severance incurred in connection with the Restructuring Plan and a $2.1 million increase in stock-based compensation expense.

The increase in general and administrative expenses also included an increase of $2.3 million in restructuring costs for exit costs and asset write-offs associated with the Restructuring Plan, a $0.5 million increase in allocated overhead, and a $0.3 million increase in the fair value of contingent consideration.

The increase in general and administrative spend was partially offset by a decrease of $2.9 million in third-party professional fees, mostly attributable to a decrease in acquisition related expenses and professional fees.

General and administrative headcount decreased by 6 from July 31, 2024 to July 31, 2025, primarily attributable to the Restructuring Plan.

We expect general and administrative expenses will decrease as a percentage of total revenues as we leverage operational efficiencies from our existing infrastructure.

Non-Operating Income (Expense)

Three Months Ended April 30,

Three Months Ended July 31, Six Months Ended July 31,

($ in thousands) 2024 2025 2024 2025

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Other income (expense), net 150 0.1 717 0.5 (594) (0.2) 16,814 5.7

Interest income decreased $0.2 million for the three months ended April 30, 2025 compared to the three months ended April 30, 2024, due to balance and rate fluctuations of our accounts earning interest.

Interest expense increased $3.0 million for the three months ended April 30, 2025 compared to the three months ended April 30, 2024, primarily due to borrowings on our revolving credit facility.

The increase of $16.8 million in other income (expense), net for the three months ended April 30, 2025 compared to the three months ended April 30, 2024, was primarily driven by remeasurement of intercompany loans and transactions that are denominated in currencies other than the underlying functional currency of the applicable entity.

Interest income increased $0.2 million for the three months ended July 31, 2025 compared to the three months ended July 31, 2024, primarily attributable to balance and rate fluctuations of our accounts earning interest.

Interest expense increased $2.6 million for the three months ended July 31, 2025 compared to the three months ended July 31, 2024, primarily attributable to borrowings on our revolving credit facility.

The increase of $0.6 million in other income, net for the three months ended July 31, 2025 compared to the three months ended July 31, 2024, was primarily attributable to remeasurement of intercompany loans and transactions that are denominated in currencies other than the underlying functional currency of the applicable entity.

Interest income was flat for the six months ended July 31, 2025 compared to the six months ended July 31, 2024.

Interest expense increased $5.6 million for the six months ended July 31, 2025 compared to the six months ended July 31, 2024, primarily attributable to borrowings on our revolving credit facility.

The increase of $17.4 million in other income (expense), net for the six months ended July 31, 2025 compared to the six months ended July 31, 2024, was primarily attributable to intercompany loans and transactions that are denominated in currencies other than the underlying functional currency of the applicable entity.

Income Tax Provision (Benefit)

Three Months Ended April 30,

Three Months Ended July 31, Six Months Ended July 31,

($ in thousands) 2024 2025 2024 2025

Income tax provision (benefit) $ 1,753 1.3 % $ 1,209 0.8 % $ (1,229) (0.5) % $ 5,743 2.0 %

Income tax benefit was $3.0 million for the three months ended April 30, 2024 compared to a provision for $4.5 million for the three months ended April 30, 2025, and resulted in an effective tax rate of 56.5% and 43.0%, respectively.

The change in the effective tax rate for the three months ended April 30, 2025 compared to the effective tax rate for the three months ended April 30, 2024 was primarily due to a reduction of our valuation allowance and profitable foreign jurisdictions.

Income tax provision was $1.8 million for the three months ended July 31, 2024, compared to a provision of $1.2 million for the three months ended July 31, 2025, and resulted in an effective tax rate of (18.9)% and (9.7)%, respectively.

Income tax benefit was $1.2 million for the six months ended July 31, 2024 compared to an income tax provision of $5.7 million for the six months ended July 31, 2025, and resulted in an effective tax rate of 8.4% and (293.1)%, respectively.

The change in the effective tax rate for the six months ended July 31, 2024 compared to the effective tax rate for the six months ended July 31, 2025 was primarily attributable to changes in our valuation allowance and profitable foreign jurisdictions.

We continue to maintain a valuation allowance against our deferred tax assets in several jurisdictions, including the U.S.

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

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

Through acquisitions, the Company recorded a net U.S.

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

by $2.0 million during the three months ended April 30, 2025.

by $2.0 million during the first quarter of the Company's fiscal 2026.

The Company increased the valuation allowance in the United Kingdom by $2.5 million due to limitations on the ability to utilize acquired deferred tax attributes as part of corporate reorganizations related to foreign acquisitions during the second quarter of the Company's fiscal 2026.

On July 4, 2025, H.R.

1, the One Big Beautiful Bill Act was signed into law.

This legislation includes several changes to federal tax law that generally allow for more favorable deductibility of certain business expenses beginning in the Company’s fiscal 2026, including the restoration of immediate expensing of domestic research and development expenditures, more favorable rules for determining limitations on deductions for interest expense, and reinstatement of accelerated fixed asset depreciation.

These changes were reflected in the income tax provision for the period ending July 31, 2025 and did not result in material changes to the Company’s tax position.

In addition, this could increase our operating cash flows in future periods through a reduction in cash remittances of U.S.

federal and state income tax.

Non-GAAP Financial Measure

In addition to providing financial measurements based on GAAP, we provide non-GAAP operating income as an additional financial metric that is not prepared in accordance with GAAP (non-GAAP).

Our calculation of non-GAAP operating income is described below.

Our calculation of non-GAAP

operating income is described below.

Management uses this non-GAAP financial measure, in addition to GAAP financial measures, to understand and compare operating results across accounting periods, for financial and operational decision making, for planning and forecasting purposes, and to evaluate our financial performance.

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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.

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.

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The following table reconciles non-GAAP operating income to loss from operations, the most directly comparable financial measure, calculated and presented in accordance with GAAP (in thousands):

Three Months Ended April 30,

Three Months Ended July 31, Six Months Ended July 31,

($ in thousands) 2024 2025 2024 2025

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Litigation expenses 1

Restructuring and related charges — 10,065 — 10,065

Total adjustments 27,204 39,306 55,312 65,649

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Liquidity and Capital Resources

As of April 30, 2025, we had $133.2 million in cash and cash equivalents and an accumulated deficit of $379.4 million.

As of July 31, 2025, we had $122.9 million in cash and cash equivalents and an accumulated deficit of $393.0 million.

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.

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

As of April 30, 2025, the Company had $208.5 million outstanding and no letters of credit issued under the credit facility, was in compliance with all covenants, and had borrowing availability of $41.5 million.

During the three months ended April 30, 2025, the Company had net borrowings of $42.5 million to fund the Sandbox Banking acquisition and repurchase shares of the Company's common stock.

As of April 30, 2025, the applicable interest rate was 6.32%.

As of July 31, 2025, the Company had $203.5 million outstanding and no letters of credit issued under the credit facility, was in compliance with all covenants, and had borrowing availability of $46.5 million.

During the six months ended July 31, 2025, the Company had net borrowings of $37.5 million to fund the Sandbox Banking acquisition and repurchase shares of the Company's common stock.

As of July 31, 2025, the applicable interest rate was 6.33%.

See Note 10 "Revolving Credit Facility" of the notes to our unaudited condensed consolidated financial statements included in Part I, Item I of this Quarterly Report on Form 10-Q for more information.

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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 to incur capital expenditures for planned office build-outs to accommodate our growth, primarily for an international office, which we estimate to spend approximately $3.9 million in the remainder of fiscal 2026.

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

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

During the three months ended April 30, 2025, we repurchased 1.8 million shares of our outstanding common stock for $40.6 million, excluding transaction costs and excise tax associated with the repurchases, if any.

As of April 30, 2025, $59.4 million remained available for future repurchases under the share repurchase program.

During the six months ended July 31, 2025, we repurchased 2.6 million shares of our outstanding common stock for $60.5 million, excluding transaction costs and excise

tax associated with the repurchases, if any.

As of July 31, 2025, $39.5 million remained available for future repurchases under the share repurchase program.

See Note 8 "Stockholders' Equity" of the notes to our unaudited condensed consolidated financial statements included in Part I, Item I of this Quarterly Report on Form 10-Q for more information.

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The balance of the redeemable non-controlling interest is reported on our balance sheet below total liabilities but above stockholders’ equity at the greater of the initial carrying amount adjusted for the redeemable non-controlling interest’s share of earnings or losses and other comprehensive income or loss, or its estimated redemption value.

As of January 31, 2025 and April 30, 2025, the redeemable non-controlling interest was $8.3 million and $8.7 million, respectively.

As of January 31, 2025 and July 31, 2025, the redeemable non-controlling interest was $8.3 million and $10.3 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 the three months ended April 30, 2024 and 2025 are set forth below:

Three Months Ended April 30,

Summary Cash Flow information for the six months ended July 31, 2024 and 2025 are set forth below:

Six Months Ended July 31,

($ in thousands) 2024 2025

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Net cash used in investing activities (91,925) (53,445)

Net cash provided by financing activities 55,980 2,250

Net cash provided by (used in) financing activities 43,159 (20,184)

Net Cash Provided by Operating Activities

The $54.3 million provided by operating activities in the three months ended April 30, 2025 reflects our net income of $6.0 million, $19.1 million in net non-cash charges and $29.2 million generated by changes in working capital accounts.

Non-cash charges primarily consisted of stock-based compensation, depreciation and amortization, amortization of costs capitalized to obtain revenue contracts, deferred income taxes, non-cash operating lease costs, provision for bad debt, and change in fair value of contingent consideration, partially offset by deferred income taxes and foreign currency gains related to remeasurement of intercompany loans and transactions and gains on investments.

Cash generated by working capital accounts was principally a function of a $45.7 million decrease in accounts receivable due to the timing of billings and collections from customers, $5.2 million increase in deferred revenue due to the timing of billings and revenue recognition, and a $0.5 million increase in accounts payable.

The cash generated by working capital accounts was partially offset by a $15.8 million decrease in accrued expenses and other liabilities primarily due to the payout of bonuses and commission, an increase of $3.2 million of capitalized costs to obtain revenue contracts, which consisted primarily of sales commissions, and a $1.5 million increase in prepaid expenses and other assets and a $1.3 million decrease in operating lease liabilities.

The $54.4 million provided by operating activities in the three months ended April 30, 2024 reflects our net loss of $2.3 million, offset by $30.7 million generated by changes in working capital accounts and $26.0 million in non-cash charges.

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

Cash generated by working capital accounts was principally a function of a $37.5 million decrease in accounts receivable due to timing of billings and collections from customers, a $6.2 million increase in deferred revenue, due to the timing of billings and revenue recognition and a $3.8 million increase in accounts payable which includes acquisition related expenses.

The cash generated by working capital accounts was partially offset by a $8.2 million decrease in accrued expenses and other current liabilities primarily due to the payout of bonuses and commissions, $5.1 million of capitalized costs to obtain revenue contracts, which consisted primarily of sales commissions, a $2.1 million increase in prepaid expenses and other assets, and a $1.4 million decrease in operating lease liabilities.

The $72.1 million provided by operating activities in the six months ended July 31, 2025 reflects our net loss of $7.7 million, offset by $54.7 million in net non-cash charges and $25.0 million generated by changes in working capital accounts.

Non-cash charges primarily consisted of stock-based compensation, depreciation and amortization, amortization of costs capitalized to obtain revenue contracts, deferred income taxes, non-cash operating lease costs, loss on disposal of long-lived assets, change in fair value of contingent consideration, provision for bad debt, and amortization of debt issuance costs, partially offset by foreign currency gains related to remeasurement of intercompany loans and transactions and gains on investments.

Cash generated by working capital accounts was principally a function of a $51.8 million decrease in accounts receivable due to the timing of billings and collections from customers, a $1.6 million decrease in prepaid expenses, and a $0.7 million increase in accounts payable.

The cash generated by working capital accounts was partially offset by a $16.4 million decrease in accrued expenses and other liabilities primarily due to the payment of bonuses and commission, an increase of $6.6 million of capitalized costs to obtain revenue contracts, which consisted primarily of sales commissions, a $3.4 million decrease in deferred revenue due to the timing of billings and revenue recognition, and a $2.6 million decrease in operating lease liabilities.

The $59.4 million provided by operating activities in the six months ended July 31, 2024 reflects our net loss of $13.3 million, offset by $58.4 million in non-cash charges and $14.3 million generated by changes in working capital accounts.

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, partially offset by deferred income taxes.

Cash generated by working capital accounts was principally a function of a $37.8 million decrease in accounts receivable due to timing of billings and collections from customers, and a $0.8 million increase in accounts payable.

The cash generated by working capital accounts was partially offset by a $8.6 million decrease in accrued expenses and other current liabilities primarily due to the payment of bonuses and commissions, an increase of $8.4 million of capitalized costs to obtain revenue contracts, which consisted primarily of sales commissions, a $2.6 million decrease in deferred revenue, due to the timing of billings and revenue recognition, a $2.4 million increase in prepaid expenses and other assets, and a $2.2 million decrease in operating lease liabilities.

Net Cash Used in Investing Activities

The $48.3 million used in investing activities in the three months ended April 30, 2025 was comprised of $50.3 million used for the acquisition of Sandbox, $1.7 million for the purchase of property and equipment and leasehold improvements to support the expansion of our business.

The $53.4 million used in investing activities in the six months ended July 31, 2025 was comprised of $50.3 million used for the acquisition of Sandbox, $6.9 million for the purchase of property and equipment and leasehold improvements to support the expansion of our business primarily for one of our international offices.

The cash used in investing activities was partially offset by proceeds from the sale of an investment of $3.7 million.

The $91.2 million used in investing activities in the three months ended April 30, 2024 was comprised of $90.7 million used for the acquisition of DocFox and ILT, $0.3 million for the purchase of property and equipment and leasehold improvements to support the expansion of our business, and $0.2 million for an asset acquisition.

Net Cash Provided by Financing Activities

The $2.3 million provided by financing activities in the three months ended April 30, 2025 was comprised principally of $102.5 million proceeds from borrowings on our credit facility, to fund the acquisition of Sandbox Banking and to make repurchases of our common stock under the stock repurchase program, and $0.7 million of proceeds from the exercise of stock options.

The cash provided by financing activities was offset by payments of $60.0 million on our credit facility, repurchases of our common stock of $40.6 million, and principal payments of $0.4 million on financing obligations.

The $56.0 million provided by financing activities in the three months ended April 30, 2024 was comprised principally of payments of $75.0 million proceeds from borrowings on our credit facility to fund the acquisition of DocFox and $1.6 million of proceeds from the exercise of stock options.

The cash provided by financing activities was partially offset by payments of $20.0 million

on the credit facility, principal payments of $0.4 million on financing obligations, and payments of debt issuance costs of $0.3 million.

The $91.9 million used in investing activities in the six months ended July 31, 2024 was comprised of $90.8 million used for the acquisition of DocFox and ILT, $0.8 million for the purchase of property and equipment and leasehold improvements to support the expansion of our business, and $0.3 million for an asset acquisition.

Net Cash Provided by (Used in) Financing Activities

The $20.2 million used in financing activities in the six months ended July 31, 2025 was comprised principally of payments of $65.0 million on our credit facility, repurchases of our common stock of $60.6 million, and principal payments of $0.8 million on financing obligations.

The cash used in financing activities was offset by $102.5 million proceeds from borrowings on our credit facility to fund the acquisition of Sandbox Banking and to make repurchases of our common stock under the stock repurchase program, $2.4 million of proceeds from stock issuances under the employee stock purchase plan, and $1.3 million of proceeds from the exercise of stock options.

The $43.2 million provided by financing activities in the six months ended July 31, 2024 was comprised principally of payments of $75.0 million of borrowings on the Credit Facility to fund the acquisition of DocFox, $2.5 million of proceeds from stock issuances under the employee stock purchase plan, and $1.7 million of proceeds from the exercise of stock options.

The cash provided by financing activities was partially offset by payments of $35.0 million on the credit facility, principal payments of $0.7 million on financing obligations, and payments of debt issuance costs of $0.4 million.

Contractual Obligations and Commitments

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

What changed 10-Q

Item 2. Management’s Discussion and Analysis