COMSCORE, INC. 10-Q

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our Condensed Consolidated Financial Statements and the related Notes to Condensed Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q, or 10-Q. In addition to historical financial information, the following discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. Our actual results and timing of selected events in future periods may differ materially from those anticipated or implied in these forward-looking statements as a result of many factors, including those discussed under Item 1A , "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2024 (the "2024 10-K"), under Item 1A , "Risk Factors" in this 10-Q and elsewhere in this 10-Q. See also " Cautionary Note Regarding Forward-Looking Statements " at the beginning of this 10-Q. Overview We are a global information and analytics company that measures advertising, content, and the consumer audiences of each, across media platforms. We create our products using a global data platform that combines information on digital platforms (connected televisions, mobile devices, tablets and computers), televisions, direct to consumer applications, and movie screens with demographics and other descriptive information. We have developed proprietary data science that enables measurement of person-level and household-level audiences, removing duplicated viewing across devices and over time. This combination of data and methods enables a common standard for buyers and sellers to transact on advertising. This helps companies across the media ecosystem better understand and monetize their audiences and develop marketing plans and products to more efficiently and effectively reach those audiences. Our ability to unify behavioral and other descriptive data enables us to provide audience ratings, advertising verification and granular consumer segments that describe hundreds of millions of consumers. Our customers include digital publishers, television networks, movie studios, content owners, brand advertisers, agencies and technology providers. The platforms we measure include televisions, mobile devices, computers, tablets, CTV devices and movie theaters. The information we analyze crosses geographies, types of content and activities, including websites, mobile and over-the-top applications, video games, television and movie programming, e-commerce and advertising. Results of Operations The following table sets forth selected Condensed Consolidated Statements of Operations and Comprehensive Loss data as a percentage of revenues for each of the periods indicated. Percentages may not add due to rounding. Three Months Ended March 31, 2025 2024 (In thousands) Dollars % of Revenue Dollars % of Revenue Revenues $ 85,709 100.0 % $ 86,795 100.0 % Cost of revenues 51,747 60.4 % 50,067 57.7 % Selling and marketing 14,803 17.3 % 15,364 17.7 % Research and development 8,118 9.5 % 8,767 10.1 % General and administrative 12,475 14.6 % 13,213 15.2 % Amortization of intangible assets 632 0.7 % 801 0.9 % Restructuring — — % 460 0.5 % Total expenses from operations 87,775 102.4 % 88,672 102.2 % Loss from operations (2,066) (2.4) % (1,877) (2.2) % Interest expense, net (1,758) (2.1) % (572) (0.7) % (Loss) gain from foreign currency transactions (1,743) (2.0) % 963 1.1 % Other income, net — — % 275 0.3 % Loss before income taxes (5,567) (6.5) % (1,211) (1.4) % Income tax benefit 1,574 1.8 % 157 0.2 % Net loss $ (3,993) (4.7) % $ (1,054) (1.2) % 16 Table of Contents Revenues Our products and services are organized around two solution groups: • Content & Ad Measurement represents the measurement portion of our business - measuring audiences across content and advertisements for linear TV, CTV, desktops, laptops, tablets and mobile devices. Product offerings reported in this solution group include our legacy subscription-based syndicated offerings that measure audiences for linear TV (national and local), digital and streaming, as well as theatrical box office receipts. Also included in this solution group are our transaction-based cross-platform products, Proximic by Comscore ("Proximic"), our Activation solution suite, Comscore Campaign Ratings ("CCR") and Comscore Content Measurement ("CCM"). These syndicated and cross-platform products are used as currency to plan and execute ad campaigns, measure the outcome of ad campaigns, optimize ad campaigns that are in-flight, activate programmatic campaigns, and make content easier for programmatic advertisers to reach. • Research & Insight Solutions represents the custom solutions we provide that are tailored to our clients' specific needs. These offerings include custom TV, digital and cross-platform data feeds, as well as other data integrations. They also include our survey business, our Consumer Brand Health business, and other bespoke research, data and insight deliverables that help our clients better understand their business, competitive landscape, clients and market. We categorize our revenue along these two solution groups; however, our cost structure is tracked at the corporate level and not by our solution groups. These shared costs include employee costs, purchased data, operational overhead, data storage and technology that supports both solution groups. Revenues for the three months ended March 31, 2025 and 2024 were as follows: Three Months Ended March 31, (In thousands) 2025 % of Revenue 2024 % of Revenue $ Variance % Variance Content & Ad Measurement Syndicated Audience $ 63,504 74.1 % $ 64,600 74.4 % $ (1,096) (1.7) % Cross-Platform 9,662 11.3 % 8,020 9.3 % 1,642 20.5 % Total Content & Ad Measurement 73,166 85.4 % 72,620 83.7 % 546 0.8 % Research & Insight Solutions 12,543 14.6 % 14,175 16.3 % (1,632) (11.5) % Total revenues $ 85,709 100.0 % $ 86,795 100.0 % $ (1,086) (1.3) % Content & Ad Measurement revenue increased due to renewals and new business in local TV and an increase in our Cross-Platform revenue, primarily driven by increased usage of our Proximic products. This increase was offset by a decrease in revenue from our national TV and syndicated digital products due to lower renewals. Research & Insight Solutions revenue decreased primarily due to lower deliveries of certain custom digital products. Cost of Revenues Cost of revenues consists primarily of expenses related to producing our products, operating our network infrastructure, and the recruitment, maintenance and support of our consumer panels. These expenses include employee costs for salaries, benefits, stock-based compensation and other related personnel costs of network operations, survey operations, custom analytics and technical support, all of which are expensed as they are incurred. Cost of revenues also includes costs to obtain multichannel video programming distributor ("MVPD") data sets and panel, census-based and other data sets used in our products as well as operational costs associated with our data centers, including depreciation expense associated with computer equipment and internally developed software that supports our panels and systems. Additionally, cost of revenues includes allocated overhead, lease expense and other facilities-related costs, and depreciation expense generated by general purpose equipment and software. 17 Table of Contents Cost of revenues for the three months ended March 31, 2025 and 2024 were as follows: Three Months Ended March 31, (In thousands) 2025 % of Revenue 2024 % of Revenue $ Change % Change Data costs $ 17,255 20.2 % $ 18,787 21.6 % $ (1,532) (8.2) % Employee costs 10,656 12.4 % 9,895 11.4 % 761 7.7 % Lease expense and depreciation 7,057 8.2 % 6,099 7.0 % 958 15.7 % Systems and bandwidth costs 6,852 8.0 % 6,781 7.8 % 71 1.0 % Panel costs 3,499 4.1 % 3,037 3.5 % 462 15.2 % Royalties and resellers 2,051 2.4 % 1,203 1.4 % 848 70.5 % Sample and survey costs 1,542 1.8 % 1,740 2.0 % (198) (11.4) % Professional fees 1,409 1.6 % 1,257 1.4 % 152 12.1 % Technology 1,176 1.4 % 1,035 1.2 % 141 13.6 % Other 250 0.3 % 233 0.3 % 17 7.3 % Total cost of revenues $ 51,747 60.4 % $ 50,067 57.7 % $ 1,680 3.4 % Lease expense and depreciation increased primarily due to higher depreciation driven by an increase in capitalized internal-use software and finance leases. Royalties and resellers costs increased primarily due to increased sales for products in which we pay royalties. Data costs decreased primarily due to the December 2024 amendment to our data license agreement with Charter Operating, for which fees are now paid based on household counts provided during the period. Selling and Marketing Selling and marketing expenses consist primarily of employee costs, including salaries, benefits, commissions, stock-based compensation and other related costs for personnel associated with sales and marketing activities, as well as costs related to online and offline advertising, industry conferences, promotional materials, public relations, other sales and marketing programs and allocated overhead, lease expense and other facilities-related costs, and depreciation expense generated by general purpose equipment and software. Selling and marketing expenses for the three months ended March 31, 2025 and 2024 were as follows: Three Months Ended March 31, (In thousands) 2025 % of Revenue 2024 % of Revenue $ Change % Change Employee costs $ 11,627 13.6 % $ 11,928 13.7 % $ (301) (2.5) % Technology 811 0.9 % 794 0.9 % 17 2.1 % Professional fees 679 0.8 % 697 0.8 % (18) (2.6) % Marketing and advertising 644 0.8 % 847 1.0 % (203) (24.0) % Lease expense and depreciation 557 0.6 % 690 0.8 % (133) (19.3) % Other 485 0.6 % 408 0.5 % 77 18.9 % Total selling and marketing expenses $ 14,803 17.3 % $ 15,364 17.7 % $ (561) (3.7) % Research and Development Research and development expenses include product development costs, consisting primarily of employee costs including salaries, benefits, stock-based compensation and other related costs for personnel associated with research and development activities, third-party expenses to develop new products and third-party data costs and allocated overhead, lease expense and other facilities-related costs, and depreciation expense related to general purpose equipment and software. Research and development expenses for the three months ended March 31, 2025 and 2024 were as follows: Three Months Ended March 31, (In thousands) 2025 % of Revenue 2024 % of Revenue $ Change % Change Employee costs $ 6,296 7.4 % $ 6,751 7.8 % $ (455) (6.7) % Technology 786 0.9 % 790 0.9 % (4) (0.5) % Professional fees 483 0.6 % 526 0.6 % (43) (8.2) % Lease expense and depreciation 450 0.5 % 599 0.7 % (149) (24.9) % Other 103 0.1 % 101 0.1 % 2 2.0 % Total research and development expenses $ 8,118 9.5 % $ 8,767 10.1 % $ (649) (7.4) % General and Administrative General and administrative expenses consist primarily of employee costs including salaries, benefits, stock-based compensation and other related costs, and related expenses for executive management, finance, human capital, legal and other administrative functions, as well as professional fees, overhead, including allocated overhead, lease expense and other facilities-related costs, depreciation expense related to general purpose 18 Table of Contents equipment and software, amortization of cloud-computing implementation costs, changes in the fair value of our contingent consideration liability, Board of Directors compensation and expenses incurred for other general corporate purposes. General and administrative expenses for the three months ended March 31, 2025 and 2024 were as follows: Three Months Ended March 31, (In thousands) 2025 % of Revenue 2024 % of Revenue $ Change % Change Employee costs $ 7,282 8.5 % $ 6,415 7.4 % $ 867 13.5 % Professional fees 3,085 3.6 % 3,947 4.5 % (862) (21.8) % Technology 840 1.0 % 857 1.0 % (17) (2.0) % Lease expense and depreciation 282 0.3 % 350 0.4 % (68) (19.4) % Other 986 1.2 % 1,644 1.9 % (658) (40.0) % Total general and administrative expenses $ 12,475 14.6 % $ 13,213 15.2 % $ (738) (5.6) % Amortization of Intangible Assets Amortization expense consists of charges related to the amortization of intangible assets associated with acquisitions, primarily our 2016 Rentrak merger. Amortization of intangible assets was $0.6 million and $0.8 million during the three months ended March 31, 2025 and 2024, respectively. Interest Expense, Net Interest expense, net consists of interest income and interest expense. Interest income primarily consists of interest earned from our cash and cash equivalent balances. Interest expense primarily relates to interest and amortization of debt issuance costs under our Credit Agreement, our Prior Credit Agreement and our finance leases. We incurred interest expense, net of $1.8 million and $0.6 million during the three months ended March 31, 2025 and 2024, respectively. The increase in interest expense, net for the three months ended March 31, 2025 as compared to 2024 was primarily due to the increase in debt balance related to the Credit Agreement executed on December 31, 2024. For additional information, refer to Footnote 5 , Debt. (Loss) Gain From Foreign Currency Transactions Our foreign currency transactions are recorded as a result of fluctuations in the exchange rate between the transactional currency and the functional currency of foreign subsidiary transactions, primarily resulting in non-cash unrealized gains and losses. Our foreign currency exposures that relate to the translation to U.S. Dollars are in a net liability position, and our foreign currency exposures that relate to the translation from U.S. Dollars are in a net asset position. For the three months ended March 31, 2025, the loss from foreign currency transactions was $1.7 million. The loss was primarily driven by fluctuations in the Chilean Peso against the U.S. Dollar and the U.S. Dollar against the Euro. For the three months ended March 31, 2024, the gain from foreign currency transactions was $1.0 million. The gain was primarily driven by fluctuations between the Chilean Peso, U.S. Dollar and Euro exchange rates. Other Income, Net Other income, net represents income and expenses incurred that are generally not recurring in nature or are not part of our regular operations. Other income, net was zero and $0.3 million for the three months ended March 31, 2025 and 2024, respectively. Income Tax Benefit A valuation allowance has been established against our net U.S. federal and state deferred tax assets and certain foreign deferred tax assets, including net operating loss carryforwards. As a result, our income tax position is primarily related to foreign tax activity and U.S. deferred taxes for tax deductible goodwill and other indefinite-lived liabilities. For the three months ended March 31, 2025 and 2024, we recorded an income tax benefit of $1.6 million and $0.2 million, respectively, resulting in effective tax rates of 28.3% and 13.0%, respectively. These effective tax rates differ from the U.S. federal statutory rate primarily due to the effects of certain permanent items, foreign tax rate differences, changes in the valuation allowance against our domestic deferred tax assets and deferred tax expense resulting from amortization of tax deductible goodwill. 19 Table of Contents Liquidity and Capital Resources The following table summarizes our cash flows for each of the periods identified: Three Months Ended March 31, (In thousands) 2025 2024 Net cash provided by operating activities $ 9,062 $ 6,868 Net cash used in investing activities (5,651) (6,096) Net cash used in financing activities (3,022) (4,407) Effect of exchange rate changes on cash, cash equivalents and restricted cash 644 (384) Net increase (decrease) in cash, cash equivalents and restricted cash 1,033 (4,019) Overview Our principal uses of cash consist of cash paid for data, payroll and other operating expenses, including expenses incurred in prior periods; payments related to investments in equipment, primarily to support our consumer panels and technical infrastructure required to deliver our products and services and support our customers; and service of our debt and lease facilities. As of March 31, 2025, our principal sources of liquidity consisted of cash, cash equivalents and restricted cash totaling $34.5 million, including $3.5 million in restricted cash (primarily related to letters of credit); cash flows from our operations; and amounts available to us under our Credit Agreement, as described below. We had outstanding letters of credit of $3.2 million as of March 31, 2025. On December 31, 2024, we entered into the Credit Agreement with Blue Torch Finance LLC. The Credit Agreement has a term of four years and matures in December 2028. The Credit Agreement provides a borrowing capacity of $60.0 million consisting of a $45.0 million term loan that was fully funded at closing (the "Term Loan") and a $15.0 million revolving credit facility that was unfunded at closing (the "Revolving Facility"). Initial proceeds from the Term Loan were used to resolve our aged accounts payable, cash collateralize our outstanding letters of credit, pay transaction fees and expenses, and strengthen our cash position. As of March 31, 2025, we had no borrowings outstanding under the Revolving Facility, with remaining borrowing capacity of $15.0 million. On July 24, 2024, we issued 13.3 million additional shares of Preferred Stock to the existing holders of Preferred Stock in exchange for cancellation of our obligation to pay accrued dividends to such holders for dividend periods ended in 2023 and 2024. The additional shares of Preferred Stock have the same terms and conditions as the Preferred Stock previously issued by us, including that they accrue annual dividends at a rate of 7.5% per annum. Under the Credit Agreement, we are prohibited from paying cash dividends to the holders of Preferred Stock prior to April 1, 2026. On and after April 1, 2026, the Credit Agreement imposes certain limitations on cash dividends, including a heightened liquidity requirement. Macroeconomic Factors In recent years, macroeconomic challenges such as inflation, rising interest rates, capital market disruptions and recession concerns have caused some advertisers to reduce or delay advertising expenditures. Recent developments in U.S. trade policy have created additional uncertainty, contributing to further spending delays by advertisers. These declines have had a direct impact on demand for our products, particularly those that are tied to advertising spend. We expect that softness in the advertising market will continue to affect our business in 2025. Although we cannot quantify the impact of macroeconomic factors on our future results, any worsening of ad market conditions could negatively impact our financial position and liquidity. Preferred Stock On March 10, 2021, we issued 82,527,609 shares of Preferred Stock in exchange for gross cash proceeds of $204.0 million. Net proceeds from the issuance totaled $187.9 million after deducting issuance costs. Shares of Preferred Stock are convertible into Common Stock as described in Footnote 4 , Convertible Redeemable Preferred Stock and Stockholders' Equity (Deficit) . The holders of Preferred Stock are entitled to participate in all dividends declared on the Common Stock on an as-converted basis and are also entitled to a cumulative dividend at the rate of 7.5% per annum, payable annually in arrears and subject to increase under certain specified circumstances (including in connection with the dividend waivers described below). In addition, such holders are entitled to request, and we must take all actions reasonably necessary to pay, a one-time special dividend on the Preferred Stock equal to the highest dividend that our Board of Directors determines can be paid at the applicable time (or a lesser amount agreed by the holders), subject to additional conditions and limitations described in Footnote 4 , Convertible Redeemable Preferred Stock and Stockholders' Equity (Deficit) . We may be obligated to obtain debt financing in order to effectuate the special dividend, which could significantly impact our financial position and liquidity depending on the timing and scope of the dividend payment and related financing. At an annual meeting held on June 15, 2023, our stockholders approved proposals permitting the payment of annual dividends on the Preferred Stock in the form of cash, shares of Common Stock, additional shares of Preferred Stock, or a combination thereof, subject to conditions set forth in the Certificate of Designations governing the Preferred Stock. On the same date, each holder of Preferred Stock waived its right to receive on June 30, 2023 the annual dividends otherwise payable by us on that date. Upon receipt of the waivers, our Board elected to defer the June 2023 20 Table of Contents payment. Under the waivers and the Certificate of Designations, the deferred dividends would accrue and accumulate at a rate of 9.5% per year from June 30, 2023 until declared and paid, with payment to occur on or before December 31, 2023. On December 26, 2023, each holder of our Preferred Stock waived its right to receive the deferred dividends on or before December 31, 2023. Under these waivers and the Certificate of Designations, the deferred dividends would continue to accrue at a rate of 9.5% per year until declared and paid, with payment to occur on or before June 30, 2024. On June 27, 2024, each holder of Preferred Stock further waived its right to receive the deferred dividends on or before June 30, 2024. In addition, each holder waived its right to receive on June 30, 2024 the annual dividends otherwise payable on that date for the dividend period ending June 29, 2024. Under these waivers and the Certificate of Designations, the deferred dividends for both periods (2023 and 2024) would continue to accrue and accumulate at a rate of 9.5% per year until declared and paid, with payment to occur on or before July 31, 2024, subject to certain conditions. On July 24, 2024, we issued 13,257,294 additional shares of Preferred Stock to the existing holders of Preferred Stock in exchange for cancellation of our obligation to pay the deferred dividends described above, which totaled $32.8 million on the issuance date. On the date of issuance, the additional shares of Preferred Stock were convertible into 662,862 shares of our Common Stock, representing an effective conversion price of $49.438 per share for the canceled dividend obligation. The additional shares of Preferred Stock have the same terms and conditions as the Preferred Stock previously issued, including that holders are entitled to cumulative dividends at a rate of 7.5% per annum, payable annually in arrears and subject to increase under certain circumstances. In connection with the issuance, we also entered into an amendment to the Stockholders Agreement with the holders of Preferred Stock. Among other things, the amendment reduced the $100.0 million special dividend threshold set forth in the Stockholders Agreement by an amount equal to the liquidation preference of the additional Preferred Stock ($32.8 million). After further reducing the threshold by annual dividends paid in prior years, the current special dividend threshold is $47.0 million. As of March 31, 2025, each share of Preferred Stock was convertible into 0.052830 shares of Common Stock, with such conversion rate scheduled to return to 0.05 upon payment of accrued dividends. Any payment of dividends (annual or special) in the form of cash could significantly impact our financial position and liquidity. Secured Credit Agreement On December 31, 2024, we entered into the Credit Agreement with Blue Torch Finance LLC. The Credit Agreement has a term of four years and matures in December 2028. The Credit Agreement provides a borrowing capacity of $60.0 million consisting of the $45.0 million Term Loan and the $15.0 million Revolving Facility. As of March 31, 2025, the interest rate for the Term Loan was 11.56% based on the Adjusted Term SOFR rate, as defined in the Credit Agreement. In addition, the Credit Agreement provides for an unused commitment fee equal to 1.0% per annum of the unused Revolving Facility. Amounts outstanding under the Credit Agreement must be prepaid from time to time with the net cash proceeds of certain debt incurrences, equity issuances, asset sales and other dispositions, insurance and condemnation proceeds, tax refunds and other extraordinary receipts. Additionally, beginning with the fiscal year ending December 31, 2025, we may be required to prepay the loans annually with Excess Cash Flow (as defined in the Credit Agreement) at specified percentages. Certain payments may be subject to prepayment premiums. The Credit Agreement contains financial covenants that require us to maintain a maximum Senior Leverage Ratio and minimum Liquidity (each term as defined in the Credit Agreement) during the term of the facility. Additionally, the Credit Agreement contains restrictive covenants that limit our ability to, among other things, incur additional indebtedness and liens, make investments and loans, enter into mergers and acquisitions, make or declare dividends and other payments, enter into certain contracts, sell assets and engage in transactions with affiliates. With respect to dividends, the Credit Agreement prohibits the payment of cash dividends to holders of the Preferred Stock prior to April 1, 2026 and imposes certain limitations on cash dividends, including a heightened Liquidity requirement, on and after that date. As of March 31, 2025, we were in compliance with our covenants under the Credit Agreement. As of March 31, 2025, we had $44.9 million outstanding under the Term Loan and no borrowings outstanding under the Revolving Facility, with a remaining borrowing capacity of $15.0 million. For additional information on the Credit Agreement, refer to Footnote 5 , Debt . Operating Activities Our primary source of cash provided by operating activities is revenues generated from sales of our products and services. Our primary uses of cash from operating activities include personnel costs and costs related to data and infrastructure used to develop and maintain our products and services. Cash provided by operating activities is calculated by adjusting our net loss for changes in working capital, as well as by excluding non-cash items such as: depreciation, stock-based compensation, non-cash operating lease expense, amortization expense of finance leases and intangible assets and deferred tax benefit. Net cash provided by operating activities for the three months ended March 31, 2025 was $9.1 million compared to $6.9 million for the three months ended March 31, 2024. The increase in cash provided by operating activities was attributable to a net increase in cash generated from 21 Table of Contents operating assets and liabilities, with $4.2 million of cash provided for the three months ended March 31, 2025 as compared to $1.7 million of cash used for the three months ended March 31, 2024, primarily due to higher cash collections in 2025 as a result of customer payment timing. Investing Activities Cash used in investing activities primarily consists of payments related to capitalized internal-use software costs, purchases of computer and network equipment to support our technical infrastructure, and furniture and equipment. The extent of these investments will be affected by our ability to expand relationships with existing customers, grow our customer base and introduce new digital formats, as well as constraints on cash expenditures due to our financial position and the current economic environment. Net cash used in investing activities for the three months ended March 31, 2025 was $5.7 million compared to $6.1 million for the three months ended March 31, 2024. The decrease in cash used in investing activities was primarily due to a decrease in cash paid for capitalized internally developed software. Financing Activities Net cash used in financing activities during the three months ended March 31, 2025 was $3.0 million compared to $4.4 million during the three months ended March 31, 2024. The decrease in cash used in financing activities was primarily due to the third and final installment of the contingent consideration for the Shareablee acquisition paid during the three months ended March 31, 2025 being lower than the second installment paid during the three months ended March 31, 2024. This decrease was partially offset by financing and debt issuance payments related to our Credit Agreement during the three months ended March 31, 2025. Contractual Payment Obligations We have certain long-term contractual arrangements that have fixed and determinable payment obligations including purchase obligations with MVPDs and connected TV data providers, operating and financing leases, and data storage and bandwidth arrangements. We have data licensing agreements with a number of MVPDs and other providers for set-top box and connected TV data. These agreements have remaining terms of less than one year to six years. As of March 31, 2025, the total fixed payment obligations related to set-top box and connected TV data agreements are $118.4 million and $21.1 million, respectively. In addition, we expect to make variable payments related to a set-top box data agreement totaling an estimated $104.0 million over the next six years. We have both operating and financing leases related to corporate office space and equipment. Our leases have remaining terms from less than one year to five years. As of March 31, 2025, the total fixed payment obligation related to these agreements is $33.7 million. We have an agreement for cloud-based data storage and bandwidth to help process and store our data. The remaining term for this agreement is less than one year. As of March 31, 2025, the total fixed payment obligation related to this agreement is $10.0 million. Future Capital Requirements Our ability to generate cash is subject to our performance, general economic conditions, industry trends and other factors, including the timing of cash collections from our customers, data costs and other trade payables, service of our debt and lease facilities, dividend payment obligations, and expenses from ongoing compliance efforts and legal matters. To the extent that our existing cash, cash equivalents and operating cash flow, together with savings from cost-reduction initiatives undertaken by our management and amounts available to us under the Revolving Facility, are insufficient to fund our future activities and requirements, we may need to raise additional funds through public or private equity or debt financing. We may also be required to prepay or refinance our Credit Agreement or raise additional funds in order to pay dividends to holders of our Preferred Stock, as described above. Our history of net losses, as well as disruption and volatility in global capital and credit markets, could impact our ability to access capital resources on terms acceptable to us or at all. If we issue additional equity securities in order to raise additional funds, pay dividends or for other purposes, further dilution to existing stockholders may occur. Critical Accounting Estimates Our discussion and analysis of our financial condition and results of operations are based on our Condensed Consolidated Financial Statements, which have been prepared in accordance with GAAP. The preparation of these financial statements requires us to make estimates, assumptions and judgments that affect the amounts reported in our Condensed Consolidated Financial Statements and the accompanying Notes to Condensed Consolidated Financial Statements. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. Refer to the critical accounting estimates disclosed in Item 7 , "Management's Discussion and Analysis of Financial Condition and Results of Operations," in our 2024 10-K for detailed information about the estimates and assumptions that we consider to be the most critical to an understanding of our financial condition and results of operations. These estimates and assumptions involve significant judgments and uncertainties, and actual results in these areas could differ from our estimates. 22 Table of Contents