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Item 1A. Risk Factors

2026-03-10 compared with 2025-03-13 · 105 added, 70 removed, 798 unchanged (18% of the section changed)

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Additional discussion of the risks summarized below, and other risks that we face, may be found immediately following this summary.

Risks Related to Strategic Considerations

• Our capital allocation strategy, including our ongoing self-tender offer, may not be effective at enhancing stockholder value, or providing other benefits we expect.

Risks Related to Our Business and Industry

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• We have a history of losses and may not achieve profitability in the future.

• Adverse economic conditions including inflation or reduced technology spending may adversely impact our business.

• Adverse economic conditions including inflation, trade disputes, or reduced technology spending may adversely impact our business.

• We have and may continue to expand our business through acquisitions, which may result in unexpected risks and challenges to complete and integrate.

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• The reliability of our network and support infrastructure will be critical to our success.

Sustained failures or outages could

lead to significant costs and service disruptions, which could negatively affect our business, financial results and reputation.

Sustained failures or outages could lead to significant costs and service disruptions, which could negatively affect our business, financial results and reputation.

• Real or perceived errors, failures or bugs in our software, or in the software or systems of our third-party application providers and partners, could materially and adversely affect our operating results and growth prospects.

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Market volatility may affect the value of an investment in our common stock and could subject us to litigation.

Risks Related to Strategic Considerations

Our capital allocation strategy, including our ongoing self-tender offer, may not be effective at enhancing stockholder value, or providing other benefits we expect.

Although our capital allocation strategy, including our ongoing capital return, is intended to enhance stockholder value while allowing the Company to execute on its strategic initiatives, there can be no assurance it will be effective.

We have taken significant steps intended to better align our existing capital structure with our go-forward capital allocation strategy.

For example, in February 2026, following a strategic alternatives review process, our Board of Directors determined to commence a “modified Dutch auction” self-tender offer to repurchase up to $180.0 million in value of shares of our common stock, which was subsequently decreased to up to $140.0 million on March 4, 2026.

In connection with the self-tender offer, our long-term indebtedness is expected to increase to approximately $147.5 million, compared to approximately $98.0 million as of January 31, 2026.

Returning capital to our stockholders, including through the ongoing issuer tender offer, may reduce the market liquidity for our stock, potentially affecting its trading volatility and price, diminish our cash reserves and/or increase our leverage.

Therefore, if we do not properly allocate our capital, we may fail to produce optimal financial results and experience a reduction in stockholder value.

Risks Related to Our Business and Industry

Our revenue growth has slowed and even contracted in recent periods.

We experienced declines in our revenue growth in recent years, including revenue growth rates of 3% from the fiscal year ended January 31, 2022 to the fiscal year ended January 31, 2023, 1% from the fiscal year ended January 31, 2023 to the fiscal year ended January 31, 2024, and 4% from the fiscal year ended January 31, 2024 to the fiscal year ended January 31, 2025.

Our revenue growth has slowed and even contracted.

We experienced revenue growth rates of 6% from the fiscal year ended January 31, 2025 to the fiscal year ended January 31, 2026, 4% from the fiscal year ended January 31, 2024 to the fiscal year ended January 31, 2025, and 1% from the fiscal year ended January 31, 2023 to the fiscal year ended January 31, 2024.

While total revenue increased by 6% from the fiscal year ended January 31, 2025 to the fiscal year ended January 31, 2026, this increase was inorganic due to our acquisition of Hearsay, and without this acquisition, our revenue would have otherwise declined 2% year-over-year in the same period.

This decline is inclusive of the resulting absence of revenue from a large customer that did not renew their contract as of January 31, 2024.

Similarly, absent Hearsay's inclusion of revenue within our results for the fiscal year ended January 31, 2025, our revenue would have otherwise declined 4% year-over-year from the year ended January 31, 2024.

While our historical revenue growth rates are not indicative of future growth, we may not achieve revenue growth in future periods, or our growth rates may slow further or contract in future periods, despite any increase in revenue as a result of acquisitions.

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You should not rely on our revenue for any prior quarterly or annual periods as an indication of our future revenue or revenue growth.

While our recent decline in growth rate was largely attributable to the departure of a large customer, we may continue to experience declines as a result of a number of factors, including our ability to execute on our business strategy, our ability to compete effectively for customers and business partners, the impact of public health emergencies, such as the COVID-19 pandemic, geopolitical events and shifts such as regional conflicts that influence overall business activity, and other macroeconomic factors on our business, and other factors that are outside of our control.

We may continue to experience declines in growth rate as a result of a number of factors, including our ability to execute on our business strategy, our ability to compete effectively for customers and business partners, the impact of public health emergencies, such as the COVID-19 pandemic, geopolitical events and shifts such as regional conflicts that influence overall business activity, and other macroeconomic factors on our business, and other factors that are outside of our control.

As we adjust our strategies to reflect the recent changes in our business, including transitioning a portion of our services business to various third-party service providers, this has and may continue to negatively impact our revenue growth rates.

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We have a history of losses and may not achieve profitability in the future.

We generated a net loss of $27.9 million, $2.6 million and $65.9 million for the fiscal years ended January 31, 2025, 2024 and 2023, respectively.

While we generated net income of $37.9 million, for the fiscal year ended January 31, 2026, we generated net losses of $27.9 million and $2.6 million for the fiscal year ended January 31, 2025 and 2024, respectively.

As of January 31, 2026, we had an accumulated deficit of $669.2 million, reflecting our losses recognized historically on a GAAP basis.

While we have recognized losses on a GAAP basis, we may be deemed to be profitable for tax purposes.

While we have historically recognized losses on a GAAP basis, we may be deemed to be profitable for tax purposes.

See “Risks Related to Laws, Regulation and Taxation” for further discussion.

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In general, worldwide economic conditions such as inflation, interest rates and currency exchange rates may remain unstable, and these conditions would make it difficult for our customers, prospective customers and us to forecast and plan future business activities accurately, and they could cause our customers or prospective customers to reevaluate their decision to purchase our features.

Weak global economic conditions, changes in consumer behavior or a reduction in technology spending even if economic conditions stabilize, could adversely impact our business and results of operations in a number of ways, including longer sales cycles,

lower demand or prices for our platform, fewer subscriptions and lower or no growth.

In addition, the economies of certain countries or regions around the world may experience weakness or uncertainty, which may lead to negative impacts on our business in those areas.

Weak global economic conditions, changes in global trade policies and tariffs resulting in increased costs, changes in consumer behavior or a reduction in technology spending even if economic conditions stabilize, could adversely impact our business and results of operations in a number of ways, including longer sales cycles, lower demand or prices for our platform, fewer subscriptions and lower or no growth.

In addition, the economies of certain countries or regions around the world may experience conflict, weakness or uncertainty, which may lead to negative impacts on our business in those areas.

For example, the U.S.

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For example, on August 1, 2024, we completed our acquisition of Hearsay, and on February 7, 2025, we completed the acquisition of KabanaSoft, LLC d/b/a Places Scout.

We are currently in the process of integrating each business respective business into Yext.

We are currently in the process of integrating each business into Yext.

The pursuit of potential acquisitions may divert the attention of management and cause us to incur various expenses in identifying, investigating and pursuing suitable acquisitions, whether or not they are consummated.

In addition, the accounting for purchases can be complicated.

For example, a significant portion of the purchase price of companies we acquire may be allocated to acquired goodwill and intangible assets, which must be assessed for impairment at least annually.

In the future, if our acquisitions do not yield expected returns, we may be required to take charges to our operating results based on this impairment assessment process, which could adversely affect our results of operations.

Acquisitions could also result in dilutive issuances of equity securities or the incurrence of debt, which could adversely affect our operating results.

If an acquired business fails to meet our expectations, our business, operating results and financial condition may suffer.

We may be unable to fully capture the expected value from strategic acquisitions.

Although we have previously acquired businesses, we have limited acquisition experience.

If we acquire additional businesses, we may not be able to integrate the acquired personnel, operations and technologies successfully or effectively manage the combined business following the acquisition.

We also may not achieve the anticipated benefits from the acquired business due to a number of factors, including:

As part of our business strategy, we have in the past acquired, and may continue to acquire, other businesses and technologies.

Our acquisitions may require substantial integration and management efforts.

Successfully realizing the benefits of these acquisitions involves a number of risks, including:

• unanticipated liabilities associated with the acquisition or the acquired business;

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• use of substantial portions of our available cash to consummate the acquisition.

In addition, the accounting for purchases can be complicated.

For example, a significant portion of the purchase price of companies we acquire may be allocated to acquired goodwill and intangible assets, which must be assessed for impairment at least annually.

Acquisitions could also result in dilutive issuances of equity securities or the incurrence of debt, which could adversely affect our operating results.

If an acquired business fails to meet our expectations, our business, operating results and financial condition may suffer.

As a result of these and other risks, we may not realize the anticipated benefits from our acquisitions, divestitures, and other strategic transactions.

Any failure to achieve these benefits or failure to successfully integrate acquired businesses and technologies or disaggregate divested businesses and technologies could seriously harm our business.

Because we recognize revenue from subscriptions for our platform over the term of the subscription, downturns or upturns in new business may not be immediately reflected in our operating results.

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Our business has evolved, which makes it difficult to predict our future operating results.

As a result of changes to our platform and our sales model, including as a result of acquisitions, our ability to forecast our future operating results is limited and subject to a number of uncertainties, including our ability to plan for and model our future growth.

As a result of changes to our platform and our sales model, including as a result of our recent strategic acquisitions, our ability to forecast our future operating results is limited and subject to a number of uncertainties, including our ability to plan for and model our future growth.

The dynamic nature of our business and our industry may make it difficult to evaluate our current business and future prospects, and as a result our historical performance should not be considered indicative of our future performance.

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If our assumptions regarding these risks and uncertainties are incorrect or change due to changes in our industry, or if we do not address these risks successfully, our operating and financial results could differ materially from our expectations and our business could suffer.

In addition, we have introduced new products such as Scout in recent months, which may have a significant effect on our operations.

At the same time, our capital allocation strategy, including our ongoing self-tender offer, could distract from our ability to execute on our core business.

As a result, we may have less ability to project our performance in the near term.

We have experienced significant changes to our organization and structure and may not be able to effectively manage those changes.

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We have hired a significant number of sales personnel in recent years.

If new sales personnel are unable to achieve desired productivity levels in a reasonable period of time, or if we are unable to retain and develop talented sales personnel, we may not be able to realize the expected benefits of this investment or increase our revenue.

If new sales personnel are unable to

achieve desired productivity levels in a reasonable period of time, or if we are unable to retain and develop talented sales personnel, we may not be able to realize the expected benefits of this investment or increase our revenue.

We have significant international operations, which exposes us to risk.

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• natural disasters, pandemics, acts of terrorism, war (including the ongoing military conflicts between Russia and Ukraine and in the Middle East, and resulting sanctions imposed by the United States and other countries), and other events beyond our control;

• political or social unrest or economic instability in a specific country or region in which we operate, which could have an adverse impact on our operations in that location.

• political or social unrest or economic instability in a specific country or region in which we operate, which could have an

adverse impact on our operations in that location.

Also, our network service provider fees outside of the United States are generally higher than domestic rates, and our gross margin may be affected and may fluctuate as we expand our operations and customer base worldwide.

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Our growth depends in part on the success of our strategic relationships with existing and prospective Publisher Network application providers.

We have established strategic relationships with over 200 third-party service and application providers that comprise our Publisher Network, including Amazon Alexa, Apple, Bing, Facebook, Google Business Profile, and Yelp and many others.

These application providers provide us with direct access to update content on their websites and applications.

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If most end consumers relied on a few websites or applications for this information, or if reliably accurate information across the most used websites and applications were generated from a single source, the need to synchronize information about a business and for our platform could decline significantly.

In particular, if larger providers of internet services were able to consolidate or control key websites and apps from which end consumers seek information about businesses, including regarding physical locations, other entities and attributes, our platform may become less necessary or attractive to our customers, and our revenue would suffer accordingly.

In particular, if larger providers of internet services were able to consolidate or control key websites and apps from which end consumers seek information about businesses, including

regarding physical locations, other entities and attributes, our platform may become less necessary or attractive to our customers, and our revenue would suffer accordingly.

Our platform faces competition in the marketplace.

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If our customers do not renew their subscriptions for our platform or decrease the amounts they spend with us, our revenue will decline and our business will suffer.

If our renewal rates fall significantly below the expectations of the public market, equity research analysts or investors, the price of our common stock could also be harmed.

If our renewal rates fall significantly

below the expectations of the public market, equity research analysts or investors, the price of our common stock could also be harmed.

If we are unable to attract new customers, our revenue growth could be slower than we expect and our business may be harmed.

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For the fiscal years ended January 31, 2026, 2025 and 2024, the aggregate of our top five customers accounted for approximately 9%, 8% and 8%, respectively, of our revenue.

During the three months ended January 31, 2024, we experienced the attrition of one of these top five customers, and the corresponding absence of revenue from this customer has and will be realized primarily in our quarterly results for the fiscal year ending January 31, 2025.

During the three months ended January 31, 2024, we experienced the attrition of one of these top five customers, and the corresponding absence of revenue from this customer has since been realized primarily in our quarterly results for the fiscal year ending January 31, 2025.

We anticipate that sales of our platform to a relatively small number of customers will continue to account for a significant portion of our revenue in future periods.

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Our revenues and cash flows from these regions may be adversely affected as a result of weakness in the Euro or British Pound.

Recent trade disputes and policy announcements have resulted in increased volatility in foreign exchange rates.

In addition, our operating results are subject to fluctuation if our mix of U.S.

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Additionally, as we anticipate growing our business further outside of the United States, the effects of movements in currency exchange rates will increase as our transaction volume outside of the United States increases.

Our credit facility may not be available to us at all or on the same terms as it has in the past.

Our credit facility contains restrictive covenants that limit our ability to transfer or dispose of assets, merge with other companies or consummate certain changes of control, acquire other companies, pay dividends or repurchase Yext stock, incur additional indebtedness and liens and enter into new businesses.

We therefore may not be able to engage in any of the foregoing transactions unless we obtain the consent of the lender or terminate the credit facility, which may limit our operating flexibility.

In addition, our credit facility is secured by all of our assets and requires us to satisfy certain financial covenants.

Our credit agreement may limit our operating flexibility or otherwise adversely affect our business.

Our credit agreement contains restrictive covenants that, among other things, limit our ability to transfer or dispose of assets, acquire other companies or consummate certain changes of control, pay dividends or repurchase Yext stock, incur additional indebtedness and liens and enter into new businesses.

We therefore may not be able to engage in any of the foregoing transactions unless we obtain the consent of the required lenders and administrative agent under the credit agreement or terminate the credit agreement.

Our inability to engage in such actions could limit our operating flexibility, and prohibit us from taking certain actions that might be beneficial to our business.

In addition, our obligation under the credit agreement are secured by substantially all of our assets and guaranteed by certain of our subsidiaries.

Our credit agreement also requires us to satisfy certain financial covenants.

There is no guarantee that we will be able to generate sufficient cash flow or sales to meet these financial covenants or pay the principal and interest on any such debt.

Furthermore, there is no guarantee that future working capital, borrowings or equity financing will be available to repay or refinance any such debt.

In addition, if we do not comply with certain covenants, then other covenants may become applicable that we may not meet.

Any inability to make scheduled payments or meet the financial covenants on our credit facility would adversely affect our business.

Any inability to make scheduled payments or comply with the covenants in our credit agreement could result in the acceleration of the obligations thereunder and could adversely affect our business.

Our cash and cash equivalents may be exposed to failure of our banking institutions.

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We intend to continue to make investments to support our business and may require additional funds.

In particular, we may seek additional funds to develop new features and enhance our existing features, expand our operations, including our sales and marketing organizations and our presence outside of the United States, expand office space including into new facilities, improve our infrastructure or acquire complementary businesses, technologies, services, features and other assets.

infrastructure or acquire complementary businesses, technologies, services, features and other assets.

Accordingly, we may need to engage in equity or debt financings to secure additional funds.

If we raise additional funds through future issuances of equity or

convertible debt securities, our stockholders could suffer significant dilution, and any new equity securities we issue could have rights, preferences and privileges superior to those of holders of our common stock.

If we raise additional funds through future issuances of equity or convertible debt securities, our stockholders could suffer significant dilution, and any new equity securities we issue could have rights, preferences and privileges superior to those of holders of our common stock.

Any debt financing that we may secure in the future could involve restrictive covenants relating to our capital raising activities and other financial and operational matters, which may make it more difficult for us to obtain additional capital and to pursue business opportunities.

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We are vulnerable to computer viruses, break-ins, phishing attacks, ransomware, supply chain attacks, attempts to overload our servers with denial-of-service or other attacks and similar disruptions from unauthorized use of our computer systems.

Any such attack, or any security incident from any other source affecting us or our service providers, including, for example, through employee error or misconduct or additional vulnerabilities introduced by remote work arrangements, third-party integrations or other sources, could lead to interruptions, delays, website or application shutdowns, loss of data or unauthorized access to, or use or acquisition of, personal information, confidential information or other data that we or our service providers process or maintain.

Any such attack, or any security breach or incident from any other source affecting us or our service providers, including, for example, through employee error or misconduct or additional vulnerabilities introduced by remote work arrangements, third-party integrations or other sources, could lead to interruptions, delays, website or application shutdowns, loss, corruption, or unavailability of data or unauthorized access to, or use or acquisition of, personal information, confidential information or other data that we or our service providers maintain or otherwise process.

If we experience compromises to our security that result in performance or availability problems, the complete shutdown of our platform or the actual or perceived loss of, or unauthorized access to, unavailability of, or unauthorized use, disclosure, destruction, or other unauthorized processing of, personal information or other types of confidential information, our customers or application providers may assert claims against us for credits, refunds or other damages, and may lose trust and confidence in our platform.

Additionally, security breaches and incidents or other unauthorized access to, unavailability of, or unauthorized use, disclosure, destruction, acquisition, or other processing of, personal information or other types of confidential information that we or our service providers maintain, or the perception that any of these have occurred, could result in claims against us for identity theft or other similar fraud claims, breach of contract or indemnity, governmental enforcement actions, litigation, fines and penalties or adverse publicity, or other claims and litigation, and could cause our customers and partners to lose trust in us, any of which could have an adverse effect on our business, reputation, operating results and financial condition.

Our existing insurance coverage may not continue to be available on acceptable terms or may not be available in sufficient amounts to cover one or more large claims related to a security breach.

Our existing insurance coverage may not continue to be available on acceptable terms or may not be available in sufficient amounts to cover one or more large claims related to a security breach or incident.

An insurer may also deny coverage as to a future claim.

The successful assertion of one or more large claims against us that exceed available insurance coverage, or the occurrence of changes in our insurance policies could have a material adverse effect on our business.

We could also be required to incur significant costs for remediation or expend significant capital and other resources to address a security breach.

We could also be required to incur significant costs for remediation or expend significant capital and other resources to address a security breach or incident.

The techniques used to obtain unauthorized access, disable or degrade service or sabotage systems change frequently, often are not recognized until launched against a target and may originate from less regulated countries, we may be unable to proactively address these techniques or to implement adequate preventative measures.

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This type of unauthorized activity could negatively affect our ability to attract new customers and application providers, deter current customers and application providers from using our platform, subject us to third-party lawsuits, regulatory fines, indemnification requests or additional liability under customer contracts, or other action or liability, any of which could materially harm our business, operating results and financial condition.

Assertions by third parties of infringement or other violations by us of their intellectual property rights could result in significant costs and harm our business and operating results.

Assertions by third parties of infringement or other violations by us of their intellectual property rights could result in significant

costs and harm our business and operating results.

Patent and other intellectual property disputes are common in our industry.

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If asserted, we cannot assure you that an infringement claim will be successfully defended.

Certain third parties have

substantially greater resources than we have and may be able to sustain the costs of intellectual property litigation for longer periods of time than we can.

Certain third parties have substantially greater resources than we have and may be able to sustain the costs of intellectual property litigation for longer periods of time than we can.

A successful claim against us could require that we pay substantial damages or ongoing royalty payments, prevent us from offering our platform, or require that we comply with other unfavorable terms.

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Such litigation may fail, and even if successful, could be costly, time-consuming and distracting to management and could result in a diversion of significant resources.

Our efforts to enforce our intellectual property rights may be met with defenses, counterclaims and countersuits attacking the validity and enforceability of our intellectual property rights or alleging that we infringe the counterclaimant’s own intellectual property.

An adverse determination of any litigation or defense proceedings could put our intellectual property at risk of being invalidated or interpreted narrowly and could put our related pending patent applications at risk of not being issued.

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Our ability to mitigate risks associated with disclosure of our confidential information, including in connection with AI-powered software, will depend on our implementation, maintenance, monitoring and enforcement of appropriate technical and administrative safeguards, policies and procedures governing the use of AI in our business.

accessed via AI tools may be subject to third-party usage restrictions that could impede our ability to use such content or AI tools or

otherwise lead to liability.

Furthermore, any content created by us using generative AI tools may not be subject to copyright protection which may adversely affect our intellectual property rights in, or ability to commercialize or use, any such content, and certain content collected, used in, or accessed via AI tools may be subject to third-party usage restrictions that could impede our ability to use such content or AI tools or otherwise lead to liability.

In the United States, a number of civil lawsuits have been initiated related to the foregoing and other concerns, the outcome of any one of which may, amongst other things, require us to limit the ways in which we use AI in our business and may affect our ability to develop our AI-powered platform innovations and features.

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For example, the output produced by generative AI tools may include information subject to certain rights of publicity or privacy laws or constitute an unauthorized derivative work of the copyrighted material used in training the underlying AI model, any of which could also create a risk of liability for us, or adversely affect our business or operations.

Further, numerous jurisdictions have proposed, and in certain cases enacted, laws and regulations addressing the development, use, and deployment of AI.

In addition, the use of AI has resulted in, and may in the future result in, cybersecurity incidents that implicate the personal data of users of AI-powered applications.

To the extent that we do not have sufficient rights to use the data or other material or content used in or produced by the generative AI tools used in our business, or if we experience cybersecurity incidents in connection with our use of AI, it could adversely affect our reputation and expose us to legal liability or regulatory risk, including with respect to third-party intellectual property, privacy, publicity, contractual or other rights.

To the extent that we do not have sufficient rights to use the data or other material or content used in or produced by the generative AI tools used in our business, that we fail to comply with relevant legal obligations, or if we experience cybersecurity incidents in connection with our use of AI, or if any of the foregoing is believed or reported to have occurred, it could adversely affect our reputation and expose us to legal liability or regulatory risk, including with respect to third-party intellectual property, privacy, publicity, contractual or other rights.

Further, our competitors or other third parties may incorporate AI into their products more quickly or more successfully than us, which could impair our ability to compete effectively.

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We expect additional states may continue to enact data protection legislation that may be similar to or different from the state privacy laws already adopted.

In addition, the Department of Justice issued a final rule effective in 2025, that places limitations, and in some cases prohibitions, on certain transfers of sensitive personal data to entities located with other specified links to China and other designated countries.

These rules also may broadly require us to extract promises from other third-party service providers that they will not transfer data we share with them onward to parties linked to countries of concern.

These and other future further regulations, legislation or restrictions could adversely impact our current or future third-party arrangements, and may add unforeseen burdens to the process of contracting with service providers.

Additionally, the FTC and many state attorneys general are interpreting federal and state consumer protection laws as imposing standards for the collection, use, dissemination, and security of personal data.

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The GDPR includes stringent operational requirements for processors and controllers of personal data and imposes significant penalties for non-compliance.

Other new EU laws, including the EU Data Act, may impose additional rules and restrictions on the use of our products and services.

The United Kingdom has implemented data protection laws that substantially align with requirements under the GDPR and provide for similar penalties.

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The storage of such information may require us to modify and enhance our platform at a significant cost.

Any failure or perceived failure by us to comply with laws, regulations, policies, legal or contractual obligations, industry standards, or regulatory guidance relating to privacy or information security may result in governmental investigations and enforcement actions, litigation, fines and penalties, consumer actions, and/or adverse publicity, and could cause our customers and partners to lose trust in us, which could have an adverse effect on our reputation and business.

Any failure or perceived failure by us to comply with laws, regulations, policies, legal or contractual obligations, industry

standards, or regulatory guidance relating to privacy or information security may result in governmental investigations and enforcement actions, litigation, fines and penalties, consumer actions, and/or adverse publicity, and could cause our customers and partners to lose trust in us, which could have an adverse effect on our reputation and business.

This could materially affect our business, operating results, and financial condition.

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This framework categorizes AI systems based on the risks associated with such AI systems’ intended purposes as creating “unacceptable”, “high” or “limited” risks.

There is a risk that our current or future AI-powered software or applications may obligate us to comply with the applicable requirements of the AI Act, which may impose additional costs on us, increase our risk of liability, or adversely affect our business.

There is a risk that our current or future AI-powered software or applications may obligate us to comply with applicable requirements of the AI Act, which may impose additional costs on us, increase our risk of liability, or adversely affect our business.

For example, “high” risk AI systems are required, amongst other things, to implement and maintain certain risk and quality management systems, conduct certain conformity and risk assessments, use appropriate data governance and management practices, including in development and training, and meet certain standards related to testing, technical robustness, transparency, human oversight, and cybersecurity.

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This regulatory framework is expected to have a material impact on AI regulation in the European Union, and together with developing guidance and/or decisions in this area, may affect our use of AI and our ability to provide and to improve our services, require additional compliance measures and changes to our operations and processes, result in increased compliance costs and potential increases in civil claims against us, and could adversely affect our business, financial condition and results of operations.

Additionally, several U.S.

states have proposed, and in certain cases have enacted, legislation covering the development, deployment and use of AI technology, or otherwise imposing obligations in connection with the use of AI.

We are subject to anti-corruption and anti-bribery, laws, and anti-money laundering laws and similar laws, and non-compliance with such laws can subject us to criminal penalties or significant fines and harm our business and reputation.

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Anti-corruption and anti-bribery laws have been enforced aggressively in recent years, are interpreted broadly and prohibit companies and their employees and agents from promising, authorizing, making, offering, soliciting or accepting improper payments or other benefits to or from government officials and others in the private sector.

As we increase our international sales and business, particularly in countries with a low score on the Corruptions Perceptions Index by Transparency International, and increase our use of third-party business partners such as sales agents, distributors, resellers, or consultants, our risks under these laws may increase.

As we increase our international sales and business, particularly in countries with a low score on the Corruptions

Perceptions Index by Transparency International, and increase our use of third-party business partners such as sales agents, distributors, resellers, or consultants, our risks under these laws may increase.

We can be held liable for the corrupt or other illegal activities of our employees, representatives, contractors, business partners, resellers, agents and third-party intermediaries, even if we do not explicitly authorize, control or have actual knowledge of such activities.

While we have policies and procedures in this area, we cannot guarantee that none of our employees, agents, representatives, business partners or third-party intermediaries will take actions in violation of our policies and applicable law, for which we may be ultimately held responsible.

contracting, the loss of export privileges, whistleblower complaints, reputational harm, adverse media coverage, and other collateral consequences, all of which could have an adverse effect on our business, results of operations, prospects and financial condition.

Any allegations concerning or violations of these laws could subject us to investigations, sanctions, settlements, prosecution, enforcement actions, disgorgement of profits, significant fines, damages, other civil and criminal penalties or injunctions, suspension or debarment from government contracting, the loss of export privileges, whistleblower complaints, reputational harm, adverse media coverage, and other collateral consequences, all of which could have an adverse effect on our business, results of operations, prospects and financial condition.

In addition, responding to any action will likely result in a materially significant diversion of management’s attention and resources and significant defense and compliance costs and other professional fees.

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Although we take precautions to prevent our platform from being provided in violation of such laws, our platform may have been in the past, and could in the future be, provided inadvertently in violation of such laws, despite the precautions we take.

Additionally, although we take precautions to prevent transactions with U.S.

sanction targets, we could inadvertently provide our platform to persons prohibited by U.S.

If we fail to comply with these laws and regulations, we and certain of our employees could be subject to civil or criminal penalties, including the possible loss of export or import privileges, monetary penalties, and, in extreme cases, imprisonment of responsible employees for knowing and willful violations of these laws.

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Any change in export or import laws and regulations, shift in the enforcement or scope of existing laws and regulations, or change in the countries, governments, persons or technologies targeted by such laws and regulations, could also result in decreased use of our products or in our decreased ability to export or sell our products to existing or potential customers with international operations.

For example, in February 2022, following Russia’s invasion of Ukraine, the United States and other countries announced economic sanctions against Russia, and the United States and other countries have continued to impose wider sanctions.

Any decreased use of our products or limitation on our ability to export or sell our products would likely adversely affect our business.

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We are subject to income taxes in the United States and various jurisdictions outside of the United States.

Our effective tax rate could fluctuate due to changes in the mix of earnings and losses in countries with differing statutory tax rates, changes in non-deductible expenses, expiration or non-utilization of net operating losses, changes in excess tax benefits related to exercises and vesting of stock options and awards compensation, changes in the valuation of deferred tax assets and liabilities and our ability to utilize them, the applicability of withholding taxes, effects from acquisitions, and changes in accounting principles and tax laws in jurisdictions where we operate.

While we regularly evaluate new information that may change our judgment resulting in recognition, derecognition or change in measurement of a tax position taken, there can be no assurance that the final determination of any examinations will not have an adverse effect on our business, operating results or financial condition.

Beginning in fiscal year 2023, the Tax Cuts and Jobs Act of 2017 eliminated the option to deduct research and development expenditures currently and requires taxpayers to amortize such costs over a period of five or fifteen years.

Such provision may accelerate our cash taxes and increase our effective tax rate, resulting in an adverse effect on our overall results of operations and financial condition.

In addition, global tax developments applicable to multinational businesses continue to evolve and create uncertainty to us.

For example, the United States has enacted an alternative minimum tax for companies with modified GAAP net income in excess of $1 billion.

The Organization for Economic Cooperation and Development (the “OECD”) also has proposals regarding the implementation of global minimum tax.

Our effective tax rate could fluctuate due to multiple factors, including but not limited to changes in the mix of earnings and losses in countries with differing statutory tax rates, changes in non-deductible expenses, expiration or non-utilization of net operating losses, changes in excess tax benefits related to exercises and vesting of stock options and awards compensation, changes in the valuation of deferred tax assets and liabilities and our ability to utilize them, the applicability of withholding taxes, effects from acquisitions, and changes in accounting principles and tax laws in jurisdictions where we operate.

While we regularly evaluate new information that may affect our tax liabilities, resulting in recognition, derecognition or change in measurement of a tax position taken, there can be no assurance that the final determination of any examinations will not have an adverse effect on our business, operating results or financial condition.

In fiscal year 2023, the Tax Cuts and Jobs Act of 2017 eliminated the option to deduct research and development expenditures annually and required taxpayers to amortize such costs over a period of five or fifteen years.

On July 4, 2025, The One Big Beautiful Bill Act, or the OBBBA, was enacted in the United States and made a number of changes to the U.S.

federal income tax law.

Among other things, the OBBBA restored deductions for U.S.

research and development expenditures (while continuing to require taxpayers to capitalize and amortize foreign research and development expenditures), changed the calculation and deductibility of global intangible low-taxed income (renamed Net CFC Tested Income) and foreign derived intangibles income (renamed Foreign-Derived Deduction Eligible Income) for taxable years beginning after December 31, 2025, and changed the calculation of deductible business interest expense to include depreciation and amortization.

Although we have evaluated the potential impact of the OBBBA on our operations, business and financial performance, the application of these provisions may evolve and could cause our cash taxes and effective tax rate to fluctuate.

In addition, global tax developments applicable to multinational businesses continue to evolve and create uncertainty for us.

For example, in 2022, the United States enacted an alternative minimum tax for companies with modified GAAP net income in excess of $1 billion.

The Organization for Economic Cooperation and Development (the “OECD”) also has developed a global minimum tax framework to impose a minimum tax of 15% for multinationals with global revenue exceeding certain thresholds, known as "Pillar Two".

Although these rules are not currently applicable to us, we operate in participating countries that have implemented or are expected to implement these rules.

We continue to evaluate the impact of these tax developments as new guidance and regulations are published and such becomes applicable.

In January 2026, the OECD released administrative guidance reflecting a "side-by-side" framework to exclude U.S.

multinational companies from certain minimum tax enforcement measures beginning in fiscal 2027.

We continue to evaluate the impact of these tax developments and those under other OECD and non-U.S.

rules as new guidance and regulations are published and such becomes applicable.

Changes to these and other areas in relation to international tax reform, including future actions taken by foreign governments could increase uncertainty and may adversely affect our tax rate and operating results in future years.

We may have additional tax liabilities, which could harm our business, results of operations or financial condition.

Significant judgments and estimates are required in determining the provision for income taxes and other tax liabilities.

We generally conduct our international operations through wholly-owned subsidiaries and report our taxable income based upon our business operations in those jurisdictions.

We generally conduct our international operations through wholly-owned subsidiaries in various jurisdictions and report our taxable income based upon our business operations in those jurisdictions.

The amount of taxes we pay may depend on the application of the tax laws of various jurisdictions, including the United States, to our business activities, changes in tax rates, new or revised tax laws or interpretations of existing tax laws and policies and our ability to operate our business in a manner consistent with our corporate structure and intercompany arrangements.

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Any resulting increase in our tax obligation or cash taxes paid could adversely affect our results of operations and financial condition.

The United States enacted the Inflation Reduction Act August 2022 which introduced several tax provisions including a 1% excise tax on certain stock repurchases made after December 31, 2022.

The United States enacted the Inflation Reduction Act of 2022 which introduced several tax provisions including a 1% excise tax on certain stock repurchases made after December 31, 2022.

We may be subject to this new excise tax which could increase the cost of such repurchases.

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New income, sales, use or other tax laws, statutes, rules, regulations or ordinances could be enacted at any time, possibly with retroactive effect, and could be applied solely or disproportionately to services provided over the internet.

These enactments could adversely affect our sales activity due to the inherent cost increase the taxes would represent and ultimately result in a negative impact on our operating results and cash flows.

These enactments could adversely affect our sales activity due to the inherent cost increase the taxes would represent and ultimately result in a negative impact on our operating results

and cash flows.

Existing tax laws, statutes, rules, regulations or ordinances could be interpreted, changed, modified or applied adversely to us, possibly with retroactive effect, which could require us or our customers to pay additional tax amounts, as well as require us or our customers to pay fines or penalties and interest for past amounts.

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Some analysts have ceased covering us, and current coverage by analysts may be more limited than prior periods.

In particular, we do not plan to release any earnings guidance or host earnings conference calls in the near future and instead intend to continue to provide our financial results in a quarterly letter to stockholders and earnings release.

If additional analysts cease coverage of us or fail to publish reports on us regularly, demand for our common stock could decrease, which might cause our common stock price and trading volume to decline.

In addition, if one or more of the analysts who cover us downgrade our common stock or publish inaccurate or unfavorable research about our business, the price of our common stock would likely decline.

In addition, from time to time, we may release earnings guidance or other forward-looking statements in our earnings releases, earnings conference calls or otherwise regarding our future performance that represent our management’s estimates as of the date of release.

In the future, we may release earnings guidance or other forward-looking statements in our earnings releases, earnings conference calls or otherwise regarding our future performance that represent our management’s estimates as of the date of release.

Some or all of the assumptions of any future guidance that we furnish may not materialize or may vary significantly from actual future results.

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We currently intend to retain any future earnings to finance the operation and expansion of our business, and we do not expect to declare or pay any dividends in the foreseeable future.

In addition, our ability to pay dividends may be limited by our credit facility.

In addition, our ability to pay dividends may be limited by our credit agreement.

Consequently, stockholders must rely on sales of their common stock after price appreciation as the only way to realize any future gains on their investment.

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Such repurchases may be made from time to time subject to pre-determined price and volume guidelines.

As of January 31, 2025, we repurchased 19,512,448 shares for $118.1 million.

Repurchases pursuant to our share repurchase program could affect our stock price and increase its volatility and will reduce the market liquidity for our stock.

As of January 31, 2026, we repurchased 28,930,297 shares for $185.1 million under the repurchase program.

In addition, in February 2026, we commenced an issuer tender offer to repurchase up to $180.0 million of our common stock, which was subsequently decreased to up to $140.0 million on March 4, 2026.

Such repurchases could affect our stock price and increase its volatility and will reduce the market liquidity for our stock.

These activities may have the effect of maintaining the market price of our common stock or slow down a decline in the market price of the common stock, and, as a result, the price of our common stock may be higher than the price that otherwise might exist in the open market.

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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-K

Item 1A. Risk Factors