What changed in this filing

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Item 1. Financial Statements

2026-05-06 compared with 2025-11-05 · 118 added, 148 removed, 241 unchanged (52% of the section changed)

3 unchanged sentences

(Amounts in thousands, except share data)

September 30, 2025

March 31, 2026

December 31, 2025

2 unchanged sentences

Accounts receivable, net of allowance for doubtful accounts of $ 122 and $ 231 as of

September 30, 2025 and December 31, 2024, respectively

March 31, 2026 and December 31, 2025, respectively

Prepaid expenses and other current assets

11 unchanged sentences

Deferred revenue

Dividend payable

Total current liabilities

4 unchanged sentences

Preferred stock—$ 0.001 par value, 10,000,000 shares authorized, and 0 shares

issued and outstanding, as of September 30, 2025 and December 31, 2024

issued and outstanding, as of March 31, 2026 and December 31, 2025

Common stock—$ 0.001 par value, 200,000,000 shares authorized, 14,112,391 and

13,936,329 shares issued and outstanding, as of September 30, 2025 and

December 31, 2024

14,151,350 shares issued, and 14,111,891 and 14,151,350 shares outstanding, as of

March 31, 2026 and December 31, 2025

Treasury stock, at cost, 500 and 0 shares as of March 31, 2026 and December 31, 2025

Additional paid-in capital

Retained earnings (accumulated deficit)

Retained earnings

Total shareholders' equity

4 unchanged sentences

(Amounts in thousands, except share data)

Three Months Ended September 30,

Nine Months Ended September 30,

Three Months Ended March 31,

Costs and expenses:

15 unchanged sentences

Treasury stock

Additional paid-in

Retained earnings

(accumulated deficit)

Balance at June 30, 2024

Vesting of restricted stock units

Increase in treasury stock resulting

from shares withheld to cover

statutory taxes

Retirement of treasury stock

Share-based compensation

Balance at September 30, 2024

Balance at June 30, 2025

Vesting of restricted stock units

Increase in treasury stock resulting

from shares withheld to cover

statutory taxes

Common stock repurchased

Retirement of treasury stock

Share-based compensation

Balance at September 30, 2025

Treasury stock

Retained earnings

paid-in capital

5 unchanged sentences

statutory taxes

Common stock repurchased

Retirement of treasury stock

Share-based compensation

Balance at September 30, 2024

Balance at March 31, 2025

Balance at December 31, 2025

6 unchanged sentences

Share-based compensation

Balance at September 30, 2025

Balance at March 31, 2026

See notes to condensed consolidated financial statements.

2 unchanged sentences

(Amounts in thousands)

Nine Months Ended September 30,

Three Months Ended March 31,

CASH FLOWS FROM OPERATING ACTIVITIES:

24 unchanged sentences

Net cash used in financing activities

Net increase in cash and cash equivalents

Net decrease in cash and cash equivalents

Cash and cash equivalents at beginning of period

5 unchanged sentences

Retirement of treasury stock

Right-of-use assets obtained in exchange of operating lease liabilities

See notes to condensed consolidated financial statements.

7 unchanged sentences

The accompanying unaudited condensed consolidated financial statements reflect all normal recurring adjustments necessary to present fairly the financial position, results of operations, and cash flows for the interim periods, but are not necessarily indicative of the results of operations to be anticipated for any future interim periods or for the full year ending December 31, 2026.

The information included in this quarterly report on Form 10-Q should be read in conjunction with the consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 filed with the SEC on February 27, 2025 (“Form 10-K”).

The information included in this quarterly report on Form 10-Q should be read in conjunction with the consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025 filed with the SEC on March 4, 2026 (“Form 10-K”).

The condensed consolidated balance sheet as of December 31, 2025 included herein was derived from the audited financial statements as of that date included in the Form 10-K, but does not include all disclosures required by US GAAP.

1 unchanged sentence

The condensed consolidated financial statements include the financial statements of the Company and its subsidiaries.

All significant transactions among the Company and its subsidiaries have been eliminated upon consolidation.

All significant intercompany transactions and balances have been eliminated in consolidation.

(b) Recently issued accounting standards

In December 2023, the Financial Accounting Standard Board (the “FASB”) issued Accounting Standard Updates (“ASU”) No.

2023-09, " Income Taxes (Topic 740):

Improvements to Income Tax Disclosures (ASU 2023-09) ," which improves the transparency of income tax disclosures by requiring consistent categories and greater disaggregation of information in the effective tax rate reconciliation and income taxes paid disaggregated by jurisdiction.

It also includes certain other amendments to improve the effectiveness of income tax disclosures.

This guidance will be effective for the annual periods beginning after December 31, 2024.

Early adoption is permitted.

Upon adoption, the guidance can be applied prospectively or retrospectively.

The Company is currently evaluating the guidance to determine the impact on its condensed consolidated financial statements and related disclosures.

In November, 2024, the FASB issued ASU No.

2024-03, " Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-04), Disaggregation of Income Statement Expenses (ASU 2024-03), " which requires disclosure within the notes to financial statements of specific information about certain costs and expenses including more detailed disclosures of certain categories of expenses such as employee compensation, depreciation, and intangible asset amortization that are components of existing expense captions presented on the face of the income statement.

In November 2024, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No.

2024-03, " Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40), Disaggregation of Income Statement Expenses," which requires disclosure within the notes to financial statements of specific information about certain costs and expenses including more detailed disclosures of certain categories of expenses such as employee compensation, depreciation, and intangible asset amortization that are components of existing expense captions presented on the face of the income statement.

The update is effective for annual periods for fiscal years beginning after December 15, 2026 and interim periods beginning after December 15, 2027 on a prospective or retrospective basis.

Early adoption is permitted.

The Company is currently assessing the impact adopting this ASU will have on its condensed consolidated financial statements.

The Company is currently evaluating the impact this ASU may have on its condensed consolidated financial statements.

In September 2025, the FASB issued ASU No.

2025-06, "Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40):

Targeted Improvements to the Accounting for Internal-Use Software." This ASU removes all references to prescriptive and sequential software development stages (referred to as “project stages”) and instead requires an entity to start capitalizing software costs when management has authorized and committed to funding the software project and it is probable that the project will be completed and the software will be used to perform the function intended.

Additional updates include changes to accounting for website development costs and certain disclosure requirements.

This ASU will be effective for annual reporting periods beginning after December 15, 2027, and interim reporting periods within those annual reporting periods.

Early adoption is permitted as of the beginning of an annual reporting period.

This ASU permits an entity to apply the new guidance using either a prospective transition approach, a modified transition approach that is based on the status of the project and whether software costs were capitalized before the date of adoption, or a retrospective transition approach.

The Company is currently evaluating the impact this ASU may have on its condensed consolidated financial statements.

In December 2025, the FASB issued ASU No.

2025-11, "Interim Reporting (Topic 270):

Narrow-Scope Improvements." The ASU clarifies interim disclosure requirements and the applicability of Topic 270.

The objective of the amendments is to provide further clarity about the current interim disclosure requirements.

The ASU is effective for interim reporting periods within annual reporting periods beginning after December 15, 2027.

Adoption of this ASU can be applied using either a prospective or a retrospective approach.

Early adoption is permitted.

The Company is currently evaluating the impact this ASU may have on its condensed consolidated financial statements.

Earnings per share

Basic earnings per share is computed by dividing net income by the weighted average number of shares of common stock outstanding during the periods.

Diluted earnings per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock and is calculated using the treasury stock method for unvested shares.

Three Months Ended September 30,

Nine Months Ended September 30,

Diluted earnings per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised, vested, or converted into common stock and is calculated using the treasury stock method and contingently issuable share guidance, as applicable.

Three Months Ended March 31,

(In thousands, except share data)

1 unchanged sentence

Earnings per share:

(1) For the three and nine months ended September 30, 2025 and 2024, diluted weighted average shares outstanding are calculated by the inclusion of unvested restricted stock units ("RSUs").

(1) For the three months ended March 31, 2026 and 2025, diluted weighted average shares outstanding reflect the dilutive effect of certain unvested restricted stock units ("RSUs").

Intangible assets, net

Intangible assets other than goodwill consist of the following:

September 30, 2025

March 31, 2026

December 31, 2025

5 unchanged sentences

The gross carrying amount of software developed for internal use includes capitalized costs related to the design, development, and testing of internal-use software.

These costs primarily consist of eligible personnel-related expenses, share-based compensation, travel expenses, and other directly attributable costs incurred during the application development stage.

These costs primarily consist of eligible personnel-related expenses, share-based compensation, and travel expenses incurred by relevant employees, and other directly attributable costs incurred during the application development stage.

The gross carrying amount of acquired intangible assets reflects the acquisition cost of certain data assets for which the Company has obtained perpetual usage rights.

Amortization expenses of $ 2,651 and $ 2,382 for the three months ended September 30, 2025 and 2024, respectively, and $ 7,746 and $ 6,918 for the nine months ended September 30, 2025 and 2024, respectively, were included in depreciation and amortization expense.

As of September 30, 2025, intangible assets of $ 4,964 , included in the gross carrying amounts of intangible assets, have not yet commenced amortization, as they are not ready for their intended use.

The Company capitalized intangible asset costs of $ 3,723 and $ 2,708 during the three months ended September 30, 2025 and 2024, respectively , and $ 10,498 and $ 8,328 during the nine months ended September 30, 2025 and 2024, respectively .

As of September 30, 2025, estimated amortization expense related to the Company’s intangible assets for the remainder of 2025 through 2030 and thereafter are as follows:

Amortization expenses of $ 2,746 and $ 2,500 were included in depreciation and amortization expense for the three months ended March 31, 2026 and 2025, respectively.

As of March 31, 2026, intangible assets of $ 7,211 , included in the gross carrying amounts of intangible assets, have not yet commenced amortization, as they are not ready for their intended use.

The Company capitalized costs of intangible assets of $ 3,661 and $ 3,991 during the three months ended March 31, 2026 and 2025, respectively.

As of March 31, 2026, estimated amortization expense related to the Company’s intangible assets for the remainder of 2026 through 2031 and thereafter is as follows:

(In thousands)

September 30, 2025

March 31, 2026

Remainder of 2026

1 unchanged sentence

Goodwill represents the cost in excess of the fair value of the net assets acquired in a business combination.

As of September 30, 2025 and December 31, 2024, the balance of goodwill of $ 5,227 was as a result of the acquisition of Interactive Data, LLC, a wholly-owned subsidiary of red violet, effective on October 2, 2014.

As of March 31, 2026 and December 31, 2025, the balance of goodwill of $ 5,227 resulted from the acquisition of Interactive Data, LLC, a wholly-owned subsidiary of red violet, effective on October 2, 2014.

In accordance with ASC 350, “Intangibles - Goodwill and Other,” goodwill is tested at least annually for impairment, or when events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable, by assessing qualitative factors or performing a quantitative analysis in determining whether it is more likely than not that its fair value exceeds the carrying value.

The measurement date of the Company’s annual goodwill impairment test is October 1 .

The Company did no t record a goodwill impairment loss during the three and nine months ended September 30, 2025 and 2024, and there was no accumulated goodwill impairment loss as of September 30, 2025.

The Company did no t record a goodwill impairment loss during the three months ended March 31, 2026 and 2025, and as of March 31, 2026, there was no accumulated goodwill impairment loss.

Revenue recognition

The Company recognized revenue in accordance with ASC 606, “Revenue from Contracts with Customers” (“Topic 606”).

The Company recognizes revenue in accordance with ASC 606, “Revenue from Contracts with Customers” (“Topic 606”).

Under this standard, revenue is recognized when control of goods or services is transferred to the Company’s customers, in an amount that reﬂects the consideration the Company expects to be entitled to in exchange for those goods or services.

7 unchanged sentences

In some arrangements, a right to consideration for the Company's performance under the customer contract may occur before invoicing to the customer, resulting in an unbilled accounts receivable.

As of September 30, 2025, the current and noncurrent portion of unbilled accounts receivable of $ 1,258 and $ 1,021 , respectively, were included within accounts receivable and other noncurrent assets, respectively, on the condensed consolidated balance sheets .

As of December 31, 2024, the current and noncurrent portion of unbilled accounts receivable of $ 937 and $ 1,080 , respectively, were included within accounts receivable and other noncurrent assets, respectively , on the consolidated balance sheets.

As of March 31, 2026, the current and noncurrent portions of unbilled accounts receivable of $ 1,408 and $ 964 , respectively, were included within accounts receivable and other noncurrent assets, respectively, on the condensed consolidated balance sheets .

As of December 31, 2025, the current and noncurrent portions of unbilled accounts receivable of $ 1,137 and $ 880 , respectively, were included within accounts receivable and other noncurrent assets, respectively , on the condensed consolidated balance sheets.

The Company's revenue arrangements do not contain significant financing components.

For the three months ended September 30, 2025 and 2024, 75 % and 77 % of total revenue was attributable to customers with pricing contracts, respectively, versus 25 % and 23 % attributable to transactional customers, respectively.

For the nine months ended September 30, 2025 and 2024, 75 % and 76 % of total revenue was attributable to customers with pricing contracts, respectively, versus 25 % and 24 % attributable to transactional customers, respectively.

For the three months ended March 31, 2026 and 2025, 75 % and 74 % of total revenue was attributable to customers with pricing contracts, respectively, versus 25 % and 26 % attributable to transactional customers, respectively.

Pricing contracts are generally annual contracts or longer, with auto renewal.

If a customer pays consideration before the Company transfers services to the customer, those amounts are classified as deferred revenue.

As of September 30, 2025 and December 31, 2024, the balance of deferred revenue was $ 859 and $ 712 , respectively, all of which is expected to be realized in the next 12 months.

In relation to the deferred revenue balance as of December 31, 2024, $ 123 and $ 617 was recognized into revenue during the three and nine months ended September 30, 2025, respectively.

As of September 30, 2025, $ 19,820 of revenue is expected to be recognized in the future for performance obligations that are unsatisfied or partially unsatisfied , related to pricing contracts that have a term of more than 12 months, of which, $ 3,166 of revenue will be recognized in the remainder of 2025, $ 9,425 in 2026, $ 5,520 in 2027, $ 1,402 in 2028, $ 302 in 2029, and $ 5 in 2030.

As of March 31, 2026 and December 31, 2025, the balance of deferred revenue was $ 956 and $ 1,028 , respectively, all of which is expected to be realized in the next 12 months.

In relation to the deferred revenue balance as of December 31, 2025, $ 440 was recognized into revenue during the three months ended March 31, 2026.

As of March 31, 2026, $ 22,177 of revenue is expected to be recognized in the future for performance obligations that are unsatisfied or partially unsatisfied , related to pricing contracts that have a term of more than 12 months, of which, $ 9,507 of revenue will be recognized in the remainder of 2026, $ 8,750 in 2027, $ 2,986 in 2028, $ 814 in 2029, and $ 120 in 2030 and thereafter.

The actual timing of recognition may vary due to factors outside of the Company’s control.

6 unchanged sentences

In each quarter, the Company updates its estimate of the annual effective tax rate, and if its estimated annual tax rate changes, the Company makes a cumulative adjustment in that quarter.

The Company concluded that, due to its established historical cumulative positive income before income taxes plus permanent differences for the recent years, projections of future taxable income, and the reversal of taxable temporary differences, the realization of deferred tax assets as of September 30, 2025 was more likely than not.

The Company’s effective income tax rate was 15 % and 40 % for the three months ended September 30, 2025 and 2024, respectively, and 18 % and 28 % for the nine months ended September 30, 2025 and 2024, respectively, differing from the U.S.

statutory corporate federal income tax rate of 21 %.

For the three and nine months ended September 30, 2025, the effective income tax rates were lower than the statutory rate, primarily attributable to the benefit of research and development tax credits and excess tax benefit from share-based compensation, partially offset by state income taxes and nondeductible permanent differences.

In contrast, for the three and nine months ended September 30, 2024, the effective income tax rates were higher than the statutory rate, primarily driven by state income taxes and nondeductible permanent differences, partially offset by the benefit of research and development tax credits.

The Company concluded that, due to its established historical cumulative positive income before income taxes plus permanent differences for recent years, projections of future taxable income, and the reversal of taxable temporary differences, the realization of deferred tax assets as of March 31, 2026 was more likely than not.

The Company’s effective income tax rate was 24 % for each of the three months ended March 31, 2026 and 2025.

The effective tax rate differed from the U.S.

federal statutory rate of 21 % primarily due to state income taxes and certain nondeductible expenses, partially offset by research and development tax credits and excess tax benefits related to share-based compensation.

The Company assesses its income tax positions and records tax benefits for all years subject to examination based upon its evaluation of the facts, circumstances and information available at the reporting date.

3 unchanged sentences

Due to the existence of net operating loss carryforwards since inception, all of the Company’s income tax filings remain open for tax examinations.

The Company does no t have any material unrecognized tax benefits as of September 30, 2025 and December 31, 2024.

On July 4, 2025, the One Big Beautiful Bill Act (the "OBBBA") was enacted into law.

The OBBBA makes permanent key elements of the Tax Cuts and Jobs Act, including the full expensing of domestic research and experimentation expenditures.

ASC 740, “ Income Taxes ”, requires the effects of changes in tax rates and laws on deferred tax balances to be recognized in the period in which the legislation is enacted.

The Company evaluated the impact of the OBBBA on its financial statements and concluded that it does not have a material impact on the Company’s effective tax rate.

The Company does no t have any material unrecognized tax benefits as of March 31, 2026 and December 31, 2025.

Shareholders' equity

Common stock and treasury stock

As of September 30, 2025 and December 31, 2024, the number of issued shares of common stock was 13,967,217 and 13,936,329 , respectively.

The Company held no shares of treasury stock as of either date.

During the nine months ended September 30, 2025, the changes in the number of issued shares of common stock and treasury stock were due to the following factors:

• An aggregate of 66,767 shares of common stock were issued as a result of the vesting of RSUs, of which, 20,442 shares of common stock were withheld to pay withholding taxes upon such vesting, which were reflected in treasury stock at a cost of $ 860 .

All 20,442 shares of treasury stock were retired during the period .

• During the nine months ended September 30, 2025, the Company repurchased 15,437 shares of common stock under the Stock Repurchase Program, as defined below, which was reflected in treasury stock at a cost of $ 653 .

All 15,437 shares of treasury stock were retired during the period.

On May 2, 2022, the Board of Directors of the Company authorized the repurchase of up to $ 5.0 million of the Company's common stock from time to time, and subsequently on December 19, 2023 and March 28, 2024, the Board of Directors authorized the repurchase of an additional $ 5.0 million each, bringing the total authorization to $ 15.0 million (the "Stock Repurchase Program").

The Stock Repurchase Program does not obligate the Company to repurchase any shares and may be modified, suspended, or terminated at any time and for any reason at the discretion of the Board of Directors.

On November 3, 2025, the Board of Directors further authorized the repurchase of an additional $ 15.0 million under the Stock Repurchase Program, bringing the total authorization to $ 30.0 million.

On December 3, 2024, the Company declared a special cash dividend on its common stock of $ 0.30 per share (the “Dividend”) to shareholders of record as of January 31, 2025, and the aggregate amount of approximately $ 4.2 million was paid on February 14, 2025.

As of March 31, 2026 and December 31, 2025, the number of issued shares of common stock was 14,112,391 and 14,151,350 , respectively, which included shares of treasury stock of 500 and 0 , respectively.

The changes in the number of issued shares of common stock and treasury stock were due to the following factors:

• An aggregate of 34,659 shares of common stock were issued as a result of the vesting of RSUs, of which, 10,618 shares of common stock were withheld to pay withholding taxes upon such vesting, which were reflected in treasury stock, with a cost of $ 498 .

All 10,618 shares of treasury stock were retired during the three months ended March 31, 2026.

• During the three months ended March 31, 2026, the Company repurchased 63,500 shares of common stock under the Stock Repurchase Program, as defined below, which was reflected in treasury stock, with a cost of $ 2,704 .

Related treasury stock of 63,000 shares, with a cost of $ 2,687 , was retired during the three months ended March 31, 2026, resulting in a treasury stock balance of $ 17 as of March 31, 2026 .

On May 2, 2022, the Company's Board of Directors authorized a stock repurchase program to repurchase the Company's common stock from time to time through open market purchases, privately negotiated transactions or other means, including pursuant to Rule 10b5-1 trading plans, which was subsequently amended on each of December 19, 2023, March 28, 2024, and November 3, 2025, bringing the total authorization to $ 30.0 million (the "Stock Repurchase Program").

The Stock Repurchase Program does not obligate the Company to repurchase any shares and may be modified, suspended, or terminated at any time at the discretion of the Board of Directors.

Share-based compensation

On March 22, 2018, the Board of Directors of the Company and Cogint, Inc.

(“cogint”) (now known as Fluent, Inc.), in its capacity as sole stockholder of the Company prior to the Company’s spin-off from cogint on March 26, 2018 (the “Spin-off”), approved the Red Violet, Inc.

2018 Stock Incentive Plan (the “2018 Plan”), which became effective immediately prior to the Spin-off.

A total of 3,000,000 shares of common stock were authorized to be issued under the 2018 Plan.

Subsequently on June 3, 2020 and May 25, 2022, the Company’s stockholders approved amendments to the 2018 Plan to increase the number of shares of common stock authorized for issuance under the 2018 Plan to 4,500,000 shares and 6,500,000 shares, respectively.

On June 10, 2025, the Company's stockholders approved an amendment and restatement to the 2018 Plan (the "Amended and Restated Plan") to, among other things, further increase the number of shares of common stock authorized for issuance under the 2018 Plan from 6,500,000 shares to 7,500,000 shares.

The primary purpose of the Amended and Restated Plan is to attract, retain, reward and motivate certain individuals by providing them with an opportunity to acquire or increase a proprietary interest in the Company and to incentivize them to expend maximum effort for the growth and success of the Company, so as to strengthen the mutuality of the interests between such individuals and the stockholders of the Company.

As of September 30, 2025, there were 2,652,597 shares of common stock available for future issuance under the Amended and Restated Plan.

To date, all stock incentives issued under the Amended and Restated Plan have been in the form of RSUs.

RSUs granted under the Amended and Restated Plan vest and settle upon the satisfaction of a time-based condition or with both time- and performance-based conditions.

The time-based condition for these awards is generally satisfied over three or four years with annual vesting.

Details of unvested RSU activity during the nine months ended September 30, 2025 were as follows:

Under the Red Violet, Inc.

2018 Stock Incentive Plan, as amended and restated (the “2018 Plan”), 7,500,000 shares of the Company’s common stock are authorized for issuance.

The current amended and restated form of the 2018 Plan was approved by the Company’s stockholders on June 10, 2025 and, among other things, increased the number of shares authorized for issuance from 6,500,000 shares to 7,500,000 shares.

The primary purpose of the 2018 Plan is to attract, retain, reward and motivate certain individuals by providing them with an opportunity to acquire or increase a proprietary interest in the Company and to incentivize them to contribute to the growth and success of the Company, so as to strengthen the mutuality of the interests between such individuals and the stockholders of the Company.

As of March 31, 2026, there were 1,636,286 shares of common stock available for future issuance under the 2018 Plan.

To date, all share-based awards granted under the 2018 Plan have been in the form of RSUs.

RSUs granted under the 2018 Plan vest upon the satisfaction of either service-based vesting conditions or both service-based and performance-based vesting conditions.

Service-based vesting conditions are generally satisfied over three or four years with annual vesting.

Unvested activity related to RSUs subject solely to service-based vesting conditions for the three months ended March 31, 2026 was as follows :

Number of units

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Withheld as treasury stock (2)

Unvested as of September 30, 2025 (3)

(1) During the nine months ended September 30, 2025, the Company granted an aggregate of 112,050 RSUs to certain employees and directors at grant date fair values ranging from $ 34.18 to $ 49.67 per share, with a vesting period ranging from three to four years .

Unvested as of March 31, 2026

(1) During the three months ended March 31, 2026, the Company granted an aggregate of 22,657 RSUs to certain employees and directors at grant date fair values ranging from $ 42.39 to $ 52.81 per share, with vesting periods ranging from three to four years .

(2) Withheld as treasury stock represents shares withheld to pay statutory taxes upon the vesting of RSUs.

Refer to Note 7 for details.

(3) On March 18, 2024, the Company granted 130,000 RSUs, subject to performance-based vesting conditions, to a non-executive employee, at a grant date fair value of $ 18.30 per share.

Such RSU grant will not vest unless and until the Company has achieved certain revenue for a portion of its business prior to December 31, 2030, the final achievement date deadline.

As of September 30, 2025, the Company determined that it is not probable that the performance criteria associated with 70,000 of the 130,000 RSUs will be met.

Accordingly, no share-based compensation expense has been recognized for these RSUs.

The 70,000 RSUs remain unvested and were included in "Unvested as of September 30, 2025" in the table above.

As of September 30, 2025, unrecognized share-based compensation expense associated with the granted RSUs amounted to $ 13,399 , which is expected to be recognized over a remaining weighted average period of 2.4 years.

Share-based compensation was allocated to the following accounts in the condensed consolidated financial statements for the three and nine months ended September 30, 2025 and 2024:

Three Months Ended September 30,

Nine Months Ended September 30,

Refer to Note 7, "Shareholders' equity" for details.

As of March 31, 2026, unrecognized share-based compensation expense associated with the granted RSUs subject solely to service-based vesting conditions amounted to $ 18,055 , which is expected to be recognized over a remaining weighted average period of 2.3 years.

Performance-based awards

On March 18, 2024, the Company granted 130,000 RSUs to one non-executive employee, subject to performance-based vesting conditions, with a grant-date fair value of $ 18.30 per share.

The RSUs will vest only upon the achievement of specified revenue targets for a portion of the Company's business on or prior to December 31, 2030, the last achievement date deadline (collectively, the "2024 Performance Criteria").

Of the 130,000 RSUs granted, 15,000 vested and delivered prior to December 31, 2025.

No amortization of share-based compensation expense has been recognized for 70,000 RSUs from this grant because, as of March 31, 2026, the Company determined that it is not probable the applicable 2024 Performance Criteria will be met in the future.

On January 9, 2026, the Company granted an aggregate of 832,690 RSUs to certain key executive officers under the 2018 Plan, subject to performance-based vesting conditions, with a grant-date fair value of $ 52.77 per share.

The awards vest upon achievement of specified revenue and adjusted EBITDA margin targets over a trailing twelve-month period on or prior to March 31, 2030 (the "2026 Performance Criteria").

Each recipient received three awards of increasing size tied to progressively higher revenue thresholds, subject to a consistent adjusted EBITDA margin requirement.

In the event of a change of control, portions of the awards may vest based on enterprise value at the time of the transaction.

Compensation expense for these awards will be recognized if and when the performance conditions are determined to be probable of achievement.

No share-based compensation expense related to these awards has been recognized, because, as of March 31, 2026, the 2026 Performance Criteria are not determined to be probable.

As of March 31, 2026 and December 31, 2025, the unvested RSUs with the performance-based vesting conditions probable of achievement are 45,000 shares.

As of March 31, 2026, the unrecognized share-based compensation expense associated with the granted RSUs subject to performance-based vesting conditions amounted to $ 45,582 .

For awards probable of achievement, the unrecognized share-based compensation expense amounted to $ 360 , which is expected to be recognized over a remaining weighted average period of 2.2 years.

Summary of share-based compensation

Share-based compensation was allocated to the following accounts in the condensed consolidated financial statements for the three months ended March 31, 2026 and 2025:

Three Months Ended March 31,

(In thousands)

Cost of revenue (exclusive of depreciation and amortization)

Sales and marketing expenses

3 unchanged sentences

The Company leases its corporate headquarters of 21,020 rentable square feet in accordance with a non-cancellable operating lease agreement as amended and effective in January 2017, and the Company entered into a further amendment on September 20, 2023 to exercise the extension option for an additional 60 months through June 30, 2029, with an option to further extend for an additional 60 months.

The Company also leases an additional office space of 6,003 rentable square feet for its Seattle office in accordance with a non-cancellable operating lease agreement entered into in April 2017, which expired in March 2025.

The Company also leased an additional office space of 6,003 rentable square feet for its Seattle office in accordance with a non-cancellable operating lease agreement that expired in March 2025.

The extension options of such agreements were not included in the determination of the lease terms.

On December 20, 2024, the Company entered into a non-cancellable 80-month operating lease agreement for its new Seattle office space of 6,709 rentable square feet (the "New Seattle Lease Agreement"), with the lease commencement date on May 1, 2025 (the "Commencement Date").

For the three and nine months ended September 30, 2025 and 2024, a summary of the Company’s lease information is shown below:

Three Months Ended September 30,

Nine Months Ended September 30,

On December 20, 2024, the Company entered into a non-cancellable 80-month operating lease agreement for its new Seattle office space of 6,709 rentable square feet, with the lease commencement date on May 1, 2025.

For the three months ended March 31, 2026 and 2025, a summary of the Company’s lease information is shown below:

Three Months Ended March 31,

(In thousands)

2 unchanged sentences

Cash paid for operating leases

Right-of-use assets obtained in exchange for new

operating lease liabilities (1)

(1) The New Seattle Lease Agreement resulted in the recognition of $ 1,153 in right-of-use assets obtained in exchange for operating lease liabilities as of May 1, 2025.

The Company applied a 6.0 % discount rate, its estimated incremental borrowing rate for similar secured assets, to determine the present value of the lease payments, as the implicit rate in the lease is not readily determinable.

The discount rate was based on information available as of the Commencement Date.

As of September 30, 2025 and December 31, 2024, the weighted-average remaining term of the Company's operating leases was 4.8 years and 4.3 years, respectively, and the weighted-average discount rate used to measure the operating lease liabilities was 8.30 % and 9.94 %, respectively.

As of September 30, 2025, scheduled future maturities and present value of the operating lease liabilities are as follows:

As of March 31, 2026 and December 31, 2025, the weighted average remaining operating lease term was 4.4 years and 4.6 years, respectively, and the weighted average discount rate used to measure the operating lease liabilities was 8.16 % and 8.23 %, respectively.

As of March 31, 2026, scheduled future maturities and present value of the operating lease liabilities are as follows:

(In thousands)

September 30, 2025

March 31, 2026

Remainder of 2026

2030 and thereafter

Total maturities

5 unchanged sentences

Segment information

The Company currently has one single operating and reporting segment, identity and information solutions, as defined by ASC 280, “Segment Reporting.” The Company adopted ASU 2023-07 as of December 31, 2024.

There have been no significant changes in the basis of segmentation or in the basis of measurement of segment profit since the last annual report.

The Company’s chief operating decision maker (the “CODM”) assesses performance for the identity and information solutions segment and decides how to allocate resources based on net income that also is reported on the condensed consolidated statements of operations as net income.

The Company operates as a single operating and reportable segment, identity and information solutions, as defined under ASC 280, “Segment Reporting.” There have been no significant changes in the basis of segmentation or in the basis of measurement of segment profit since the last annual report.

The Company’s chief operating decision maker (the “CODM”) is a group consisting of its Chief Executive Officer, President, and Chief Financial Officer.

The CODM assesses performance for the identity and information solutions segment and decides how to allocate resources based on net income that also is reported on the condensed consolidated statements of operations as net income.

The measure of segment assets is reported on the condensed consolidated balance sheet as total assets.

Information about reported segment revenue, segment net income, and significant segment expenses is shown as follows:

Three Months Ended September 30,

Nine Months Ended September 30,

Three Months Ended March 31,

(Dollars in thousands)

Cost of revenue (exclusive of depreciation and

amortization)

Cost of revenue (exclusive of depreciation and amortization) (1)

Personnel-related expenses

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Consolidated net income

(1) Professional fees for the nine months ended September 30, 2025, include $ 358 of acquisition-related costs incurred in connection with the due diligence of potential strategic targets.

Comparable acquisition-related costs were $ 7 for the nine months ended September 30, 2024.

(1) Cost of revenue (exclusive of depreciation and amortization) includes certain personnel-related expenses and share-based compensation expense, which are not included in the related line items below.

(2) Professional fees for the three months ended March 31, 2026 included $ 259 of acquisition-related costs incurred in connection with due diligence of potential strategic targets.

No acquisition-related costs were incurred during the three months ended March 31, 2025.

(3) Other segment items include primarily travel and entertainment, write-off of long-lived assets, and other selling, general and administrative expenses.

1 unchanged sentence

(a) Capital commitment

The Company incurred data costs, included within cost of revenue (exclusive depreciation and amortization), of $ 2,423 and $ 2,328 for the three months ended September 30, 2025 and 2024, respectively , and $ 7,382 and $ 7,168 for the nine months ended September 30, 2025 and 2024, respectively, under certain data licensing agreements.

Effective on May 1, 2025, the Company entered into an amendment with its largest data supplier, extending the term of the agreement through April 30, 2031.

The Company may elect to extend the term for an additional twelve months upon written notice to this supplier at least 30 days prior to April 30, 2031.

As of September 30, 2025, the remaining minimum purchase commitment of the agreement with this data supplier was $ 24.6 million.

The Company incurred data costs, included within cost of revenue (exclusive of depreciation and amortization), of $ 2,439 and $ 2,542 for the three months ended March 31, 2026 and 2025, respectively , under certain data licensing agreements.

In April 2025, the Company entered into a five-year, non-cancellable cloud services agreement with a third-party provider.

1 unchanged sentence

Costs incurred under this agreement are either (i) expensed as infrastructure fees and included in cost of revenue (exclusive of depreciation and amortization) when used in the delivery of our services to customers, or (ii) capitalized as internal-use software costs within intangible assets when consumed in the development or enhancement of the Company’s internal-use software.

As of September 30, 2025, the total material capital commitments under certain data licensing agreements and the cloud service agreement amounted to $ 44,909 , shown as follows:

As of March 31, 2026, the total material capital commitments under certain data licensing agreements and the cloud service agreement amounted to $ 39,813 , shown as follows:

(In thousands)

September 30, 2025

March 31, 2026

Remainder of 2026

2030 and thereafter

(b) Contingencies

1 unchanged sentence

Legal fees associated with such legal proceedings are expensed as incurred.

The Company reviews legal proceedings and claims on an ongoing basis and follow appropriate accounting guidance, including ASC 450, when making accrual and disclosure decisions.

The Company reviews legal proceedings and claims on an ongoing basis and follows appropriate accounting guidance, including ASC 450, when making accrual and disclosure decisions.

The Company establishes accruals for those contingencies where the incurrence of a loss is probable and can be reasonably estimated, and it discloses the amount accrued and the amount of a reasonably possible loss in excess of the amount accrued, if such disclosure is necessary for its financial statements to not be misleading.

6 unchanged sentences

The Company is one of over 150 companies sued by Atlas and a combination of individual plaintiffs in actions containing nearly identical allegations and seeking similar damages.

The Company removed the matter to the United States District Court for the District of New Jersey, but the matter was remanded back to the Superior Court of New Jersey, Law Division, Monmouth County by order dated November 21, 2024, where the Action is pending.

The Company removed the matter to the United States District Court for the District of New Jersey, but it was remanded to the Superior Court of New Jersey, Law Division, Monmouth County by order dated November 21, 2024, where the Action is pending.

On May 1, 2026, the acting Administrative Director of the Courts denied Atlas’s application to consolidate all cases against various defendants in the Superior Court of New Jersey.

No trial date has been scheduled.

5 unchanged sentences

In addition to the foregoing, the Company may be involved in litigation from time to time in the ordinary course of business.

The Company does not believe that the ultimate resolution of any such matters will have a material adverse effect on its business, financial condition, results of operations or cash flows.

The Company does not believe that the ultimate resolution of any such matter will have a material adverse effect on its business, financial condition, results of operations, or cash flows.

However, the results of such matters cannot be predicted with certainty, and the Company cannot assure you that the ultimate resolution of any legal or administrative proceeding or dispute will not have a material adverse effect on its business, financial condition, results of operations, and cash flows.

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

What changed 10-Q

Item 1. Financial Statements