Yext, Inc. 10-K

Item 7A. Quantitative and Qualitative Disclosures About Market Risk Market risk represents the risk of loss that may affect our financial position due to adverse changes in financial market prices and rates. We are exposed to market risks related to foreign currency exchange rates, inflation and interest rates. Foreign Currency Risk Assets and liabilities of non-U.S. subsidiaries that operate in a local currency environment, where the local currency is the functional currency, are translated from foreign currencies into U.S. dollars using month-end rates of exchange for assets and liabilities, and average rates for the period for revenue, costs and expenses. We record translation gains and losses in accumulated other comprehensive (loss) income as a component of stockholders' equity. We reflect net foreign exchange transaction gains and losses resulting from the conversion of the transaction currency to functional currency as a component of foreign currency exchange losses in other expense, net. Based on the size of our international operations and the amount of our expenses denominated in foreign currencies, we would not expect a 10% change in the value of the U.S. dollar from rates on January 31, 2026 to have a material effect on our financial position or results of operations. These exposures may change over time as business practices evolve and economic conditions change, including recent foreign currency impacts due to the macroeconomic environment. Inflation Risk We do not believe that inflation has had a material effect on our business, financial condition or results of operations, other than its impact on the general economy which includes labor costs. Nonetheless, if our costs, in particular personnel-related costs, continue to become subject to significant inflationary pressures, we may not be able to fully offset such higher costs through price increases. Our inability or failure to do so could harm our business, financial condition and results of operations. Interest Rate Risk As of January 31, 2026, we had cash and cash equivalents of $154.1 million. The primary objective of our investments is the preservation of capital to fulfill liquidity needs. We do not enter into investments for trading or speculative purposes. We do not believe our cash equivalents have significant risk of default or illiquidity. While we believe our cash equivalents do not contain excessive risk, we cannot assure you that in the future our investments will not be subject to adverse changes in market value. In addition, we maintain significant amounts of cash and cash equivalents at one or more financial institutions that are in excess of federally insured limits and are exposed to counterparty risk. We have not been exposed to, nor do we anticipate being exposed to, material risks due to changes in interest rates. A hypothetical change of 1% in the interest rate as of January 31, 2026 would impact our annual interest expense by approximately $1.0 million. Financial Institution Risk While we seek to minimize our exposure to third-party losses of our cash and cash equivalents, we hold our balances in a number of large financial institutions. Notwithstanding, those institutions are subject to risk of failure and our balances may be uninsured in certain cases. 60 Item 8. Consolidated Financial Statements and Supplementary Data Index to Consolidated Financial Statements PAGE Reports of Independent Registered Public Accounting Firm (PCAOB ID: 42 ) 62 Consolidated Balance Sheets 65 Consolidated Statements of Operations and Comprehensive Inc ome ( L oss ) 66 Consolidated Statements of Stockholders' Equity 67 Consolidated Statements of Cash Flows 68 Notes to Consolidated Financial Statements 70 61 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Stockholders and the Board of Directors of Yext, Inc. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Yext, Inc. (the Company) as of January 31, 2026 and 2025, the related consolidated statements of operations and comprehensive income (loss), stockholders’ equity and cash flows for each of the three years in the period ended January 31, 2026, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at January 31, 2026 and 2025, and the results of its operations and its cash flows for each of the three years in the period ended January 31, 2026, in conformity with U.S. generally accepted accounting principles. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of January 31, 2026, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated March 10, 2026 expressed an unqualified opinion thereon. Basis for Opinion These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matters The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. 62 Revenue Recognition Description of the Matter The Company recorded consolidated revenue of $447 million for the year ended January 31, 2026, and $218 million of unearned revenue as of January 31, 2026. As described in Note 2 to the consolidated financial statements, the Company primarily earns revenue from subscriptions and associated support to the platform. The Company’s revenue contracts include contractual terms and conditions that can impact the amount allocated to each of its performance obligations and the timing of revenue recognition. Auditing the timing and measurement of the Company's revenue recognition was especially challenging due to the volume of executed contracts and the assessment of the unique terms. This involved assessing the contractual terms and conditions of both new and modified contracts to determine the contract period and identifying all performance obligations. How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design, and tested the operating effectiveness of the Company’s internal controls over the accounting for revenue. For example, we tested controls over the Company’s processes to evaluate contractual terms and conditions and determine the timing and amount of revenue to be recognized related to the performance obligations identified as services are transferred to the customer. This included testing relevant controls over the IT systems that are important to the initiation, processing and recording of revenue transactions. We performed audit procedures that included, among others, reading a sample of revenue contracts to evaluate the contractual terms and conditions, identify performance obligations, and assess the measurement and timing of revenue recognized and unearned revenue recorded as of year-end. We tested the revenue recognized and unearned revenue as of year-end through tests of details and analytical procedures, including the recalculation of balances on a disaggregated basis. Finally, we assessed the appropriateness of the related disclosures in the consolidated financial statements. /s/ Ernst & Young, LLP We have served as the Company’s auditors since 2014. New York, New York March 10, 2026 63 Report of Independent Registered Public Accounting Firm To the Stockholders and the Board of Directors of Yext, Inc. Opinion on Internal Control Over Financial Reporting We have audited Yext, Inc.’s internal control over financial reporting as of January 31, 2026, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). In our opinion, Yext, Inc. (the Company) maintained, in all material respects, effective internal control over financial reporting as of January 31, 2026, based on the COSO criteria. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of January 31, 2026 and 2025, the related consolidated statements of operations and comprehensive income (loss), stockholders’ equity and cash flows for each of the three years in the period ended January 31, 2026, and the related notes and our report dated March 10, 2026 expressed an unqualified opinion thereon. Basis for Opinion The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Definition and Limitations of Internal Control Over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. /s/ Ernst & Young, LLP New York, New York March 10, 2026 64 YEXT, INC. Consolidated Balance Sheets (In thousands, except share and per share data) January 31, 2026 January 31, 2025 Assets Current assets: Cash and cash equivalents $ 154,123 $ 123,133 Restricted cash, current 1,500 9,671 Accounts receivable, net of allowances of $ 2,345 and $ 2,014 , respectively 120,637 112,942 Prepaid expenses and other current assets 21,253 18,094 Costs to obtain revenue contracts, current 20,291 21,961 Total current assets 317,804 285,801 Property and equipment, net 30,088 39,689 Operating lease right-of-use assets 50,908 67,452 Restricted cash, non-current 13,551 5,850 Costs to obtain revenue contracts, non-current 10,663 11,145 Goodwill 110,801 96,782 Intangible assets, net 85,133 94,247 Other long term assets 2,828 9,112 Total assets $ 621,776 $ 610,078 Liabilities and stockholders’ equity Current liabilities: Accounts payable, accrued expenses and other current liabilities $ 52,528 $ 70,022 Unearned revenue, current 217,465 229,144 Operating lease liabilities, current 18,590 18,604 Contingent consideration, current 8,200 26,944 Total current liabilities 296,783 344,714 Operating lease liabilities, non-current 61,915 76,809 Long term debt, net 97,959 — Contingent consideration, non-current — 18,056 Other long term liabilities 5,698 17,306 Total liabilities 462,355 456,885 Commitments and contingencies (Note 15) Stockholders’ equity: Preferred stock, $ 0.001 par value per share; 50,000,000 shares authorized at January 31, 2026 and 2025; zero shares issued and outstanding at January 31, 2026 and 2025 — — Common stock, $ 0.001 par value per share; 500,000,000 shares authorized at January 31, 2026 and 2025, respectively; 158,368,658 and 153,017,243 shares issued at January 31, 2026 and 2025, respectively; 122,933,027 and 126,999,461 shares outstanding at January 31, 2026 and 2025, respectively 158 153 Additional paid-in capital 1,027,900 996,477 Accumulated other comprehensive loss ( 1,569 ) ( 5,969 ) Accumulated deficit ( 669,249 ) ( 707,120 ) Treasury stock, at cost ( 197,819 ) ( 130,348 ) Total stockholders’ equity 159,421 153,193 Total liabilities and stockholders’ equity $ 621,776 $ 610,078 See the accompanying notes to the consolidated financial statements. 65 YEXT, INC. Consolidated Statements of Operations and Comprehensive Income (Loss) (In thousands, except share and per share data) Fiscal year ended January 31, 2026 2025 2024 Revenue $ 446,579 $ 420,957 $ 404,322 Cost of revenue 114,068 96,364 87,468 Gross profit 332,511 324,593 316,854 Operating expenses: Sales and marketing 134,765 174,779 178,830 Research and development 89,874 77,201 72,040 General and administrative 63,323 105,061 72,185 Total operating expenses 287,962 357,041 323,055 Income (loss) from operations 44,549 ( 32,448 ) ( 6,201 ) Interest income 3,856 6,102 7,094 Interest expense ( 7,575 ) ( 967 ) ( 470 ) Other expense, net ( 704 ) ( 745 ) ( 761 ) Income (loss) from operations before income taxes 40,126 ( 28,058 ) ( 338 ) (Provision for) benefit from income taxes ( 2,255 ) 110 ( 2,292 ) Net income (loss) $ 37,871 $ ( 27,948 ) $ ( 2,630 ) Net income (loss) per share attributable to common stockholders, basic $ 0.31 $ ( 0.22 ) $ ( 0.02 ) Net income (loss) per share attributable to common stockholders, diluted $ 0.07 $ ( 0.22 ) $ ( 0.02 ) Weighted-average number of shares used in computing net income (loss) per share attributable to common stockholders, basic 123,563,958 126,850,809 124,056,949 Weighted-average number of shares used in computing net income (loss) per share attributable to common stockholders, diluted 129,912,882 126,850,809 124,056,949 Other comprehensive income (loss): Foreign currency translation adjustment $ 4,409 $ ( 1,792 ) $ ( 568 ) Unrealized (loss) gain on marketable securities, net ( 9 ) 6 2 Total comprehensive income (loss) $ 42,271 $ ( 29,734 ) $ ( 3,196 ) See the accompanying notes to the consolidated financial statements. 66 YEXT, INC. Consolidated Statements of Stockholders' Equity (In thousands) Accumulated Common Stock Additional Paid-In Other Comprehensive Accumulated Treasury Total Stockholders’ Shares Amount Capital (Loss) Income Deficit Stock Equity Balance, January 31, 2023 122,335 $ 142 $ 897,368 $ ( 3,617 ) $ ( 676,542 ) $ ( 89,328 ) $ 128,023 Exercise of stock options 1,704 2 9,376 — — — 9,378 Vested restricted stock units converted to common shares, net of shares withheld for employee taxes 2,952 3 ( 13,017 ) — — — ( 13,014 ) Issuance of restricted stock 75 — — — — — — Issuance of common stock under employee stock purchase plan 782 1 3,671 — — — 3,672 Stock-based compensation — — 45,224 — — — 45,224 Repurchase of common stock ( 2,981 ) — — — — ( 22,913 ) ( 22,913 ) Other comprehensive loss — — — ( 566 ) — — ( 566 ) Net loss — — — — ( 2,630 ) — ( 2,630 ) Balance, January 31, 2024 124,867 148 942,622 ( 4,183 ) ( 679,172 ) ( 112,241 ) 147,174 Exercise of stock options 367 1 1,290 — — — 1,291 Vested restricted stock units converted to common shares, net of shares withheld for employee taxes 3,509 4 ( 3,189 ) — — — ( 3,185 ) Issuance of restricted stock 138 — — — — — — Issuance of common stock under employee stock purchase plan 805 — 3,689 — — — 3,689 Stock-based compensation — — 52,065 — — — 52,065 Repurchase of common stock ( 2,687 ) — — — — ( 18,107 ) ( 18,107 ) Other comprehensive loss — — — ( 1,786 ) — — ( 1,786 ) Net loss — — — — ( 27,948 ) — ( 27,948 ) Balance, January 31, 2025 126,999 153 996,477 ( 5,969 ) ( 707,120 ) ( 130,348 ) 153,193 Exercise of stock options 341 — 2,154 — — — 2,154 Vested restricted stock units converted to common shares, net of shares withheld for employee taxes 4,339 4 ( 23,014 ) — — — ( 23,010 ) Issuance of restricted stock 67 — — — — — — Issuance of common stock under employee stock purchase plan 605 1 3,166 — — — 3,167 Stock-based compensation — — 49,117 — — — 49,117 Repurchase of common stock ( 9,418 ) — — — — ( 67,471 ) ( 67,471 ) Other comprehensive income — — — 4,400 — — 4,400 Net income — — — — 37,871 — 37,871 Balance, January 31, 2026 122,933 $ 158 $ 1,027,900 $ ( 1,569 ) $ ( 669,249 ) $ ( 197,819 ) $ 159,421 See the accompanying notes to the consolidated financial statements. 67 YEXT, INC. Consolidated Statements of Cash Flows (In thousands) Fiscal year ended January 31, 2026 2025 2024 Operating activities: Net income (loss) $ 37,871 $ ( 27,948 ) $ ( 2,630 ) Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation and amortization expense 26,986 18,531 15,805 Impairment of long-lived assets 8,552 — — Bad debt expense 3,078 1,665 888 Stock-based compensation expense 48,711 51,780 44,961 Amortization of operating lease right-of-use assets 9,420 8,729 8,804 Adjustments to contingent consideration ( 28,600 ) 5,500 — Other, net 714 ( 2,597 ) 540 Changes in operating assets and liabilities, net of assets acquired and liabilities assumed in business acquisitions: Accounts receivable ( 8,315 ) ( 1,122 ) 518 Prepaid expenses and other current assets ( 5,246 ) ( 397 ) 755 Costs to obtain revenue contracts 3,049 10,048 8,818 Other long term assets 6,528 351 896 Accounts payable, accrued expenses and other current liabilities ( 4,866 ) 17,037 ( 10,176 ) Unearned revenue ( 15,689 ) ( 20,464 ) ( 11,252 ) Operating lease liabilities ( 14,327 ) ( 11,095 ) ( 11,687 ) Other long term liabilities ( 12,019 ) 193 ( 83 ) Net cash provided by operating activities 55,847 50,211 46,157 Investing activities: Capital expenditures ( 2,557 ) ( 2,085 ) ( 2,728 ) Cash paid in acquisitions, net of cash acquired ( 18,801 ) ( 89,407 ) — Net cash used in investing activities ( 21,358 ) ( 91,492 ) ( 2,728 ) Financing activities: Proceeds from exercise of stock options 2,154 1,290 9,405 Proceeds from debt issuance 99,000 — — Repurchase of common stock ( 67,431 ) ( 17,907 ) ( 23,086 ) Payments for taxes related to net share settlement of stock-based compensation awards ( 22,974 ) ( 10,826 ) ( 13,015 ) Payments of deferred financing costs ( 1,118 ) ( 853 ) ( 452 ) Deferred acquisition payments ( 22,009 ) ( 3,542 ) — Proceeds, net from employee stock purchase plan withholdings 2,855 3,297 3,894 Net cash used in financing activities ( 9,523 ) ( 28,541 ) ( 23,254 ) Effect of exchange rate changes on cash, cash equivalents and restricted cash 5,554 ( 1,708 ) ( 205 ) Net increase (decrease) in cash, cash equivalents and restricted cash 30,520 ( 71,530 ) 19,970 Cash, cash equivalents and restricted cash at beginning of period 138,654 210,184 190,214 Cash, cash equivalents and restricted cash at end of period $ 169,174 $ 138,654 $ 210,184 Supplemental disclosure of cash flow data: Cash paid on interest $ 6,491 $ 9 $ — Cash paid on income taxes $ 3,569 $ 3,176 $ 2,716 68 Supplemental reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheets: Fiscal year ended January 31, (in thousands) 2026 2025 2024 Cash and cash equivalents $ 154,123 $ 123,133 $ 210,184 Restricted cash, current and non-current 15,051 15,521 — Total cash, cash equivalents and restricted cash $ 169,174 $ 138,654 $ 210,184 See the accompanying notes to the consolidated financial statements. 69 YEXT, INC. Notes to Consolidated Financial Statements 1. Organization and Description of Business Description of Business Yext, Inc. ("Yext" or the "Company") empowers businesses to manage their knowledge so they can deliver relevant, actionable answers to consumer questions as well as consistent, accurate and engaging experiences to customers throughout the digital ecosystem. The Company's digital presence platform (also known as the Answers Platform) lets businesses structure and organize information about their brands in the Company's Knowledge Graph (previously known as Yext Content), which is then delivered across first- and third-party websites and applications through its network of over 200 service and application providers, which the Company refers to as its Publisher Network. The Company's platform powers all of the Company's key products, including Listings, Reviews, Pages, Search, Social, Relate, and Scout, each with robust analytics capabilities for businesses to easily track performance across customer experiences. In August 2024, the Company acquired Hearsay Social, Inc., a digital client engagement platform for financial services ("Hearsay"). See Note 4 "Business Combinations" for additional information. Fiscal Year The Company's fiscal year ends on January 31 st . References to fiscal 2026, for example, are to the fiscal year ended January 31, 2026. 2. Summary of Significant Accounting Policies Basis of Presentation and Consolidation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") and applicable rules and regulations of the Securities and Exchange Commission ("SEC") regarding financial reporting. The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. There were no prior period amounts that have been reclassified to conform to the current period presentation. Business Combinations The Company accounts for business combinations using the acquisition method of accounting, which requires identifiable assets acquired and liabilities assumed in the acquiree, to be measured at their fair values, as of the acquisition date. Any excess of the fair value of consideration transferred over the fair value of the identifiable assets acquired and liabilities assumed is recorded as goodwill. The determination of fair value requires management to make significant estimates, particularly with respect to intangible assets. These estimates are inherently uncertain and subject to change as additional information is obtained during the measurement period, which lasts for up to one year from the acquisition date. Upon the conclusion of the measurement period, any subsequent adjustments are recorded in the consolidated statement of operations and comprehensive income (loss). See Note 4 "Business Combinations" for details. Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of those financial statements and the reported amounts of revenue and expense during the reporting period. These estimates include, but are not limited to, the standalone selling prices of performance obligations, the incremental borrowing rate associated with lease liabilities, the useful life of capitalized costs to obtain revenue contracts, income taxes including tax-related valuation allowances, the valuation and assumptions underlying stock-based compensation, the fair value of acquired assets and assumed liabilities from business combinations, contingent consideration, as well as the fair value of acquiree exchanged stock-based compensation awards, and useful lives and recoverability of intangible assets. Management bases its estimates on historical experience and on various other market-specific and relevant assumptions that it believes to be reasonable under the circumstances. Actual results could differ from those estimates and such differences could be material to the financial position and results of operations. Segment Information The Company is the provider of the platform and operates as one operating segment. An operating segment is defined as a component of an enterprise for which separate financial information is evaluated regularly by the chief operating decision maker ("CODM"). The CODM of the Company is the Chief Executive Officer. The CODM evaluates the Company's financial information, resources and performance on a consolidated basis. Since the Company operates as one operating segment, all required financial segment information can be found in the consolidated financial statements. 70 Revenue Recognition The Company derives its revenue primarily from its subscriptions and associated support to the Company's platform. The Company's subscriptions do not provide customers with the right to take possession of the software supporting the applications and, as a result, are accounted for as service contracts. The Company accounts for revenue in accordance with ASC Topic 606, "Revenue from Contracts with Customers". The Company recognizes revenue upon transfer of control of services to its customers in an amount that reflects the consideration it expects to receive in exchange for those services. The recognition of revenue is determined through application of the following five-step model: • Identification of the contract(s) with customers; • Identification of the performance obligation(s) in the contract; • Determination of the transaction price; • Allocation of the transaction price to the performance obligation(s) in the contract; and • Recognition of revenue when or as the performance obligation(s) are satisfied The Company identifies the performance obligations in a contract with a customer and determines whether they are distinct or distinct within the context of the contract. When there is more than one distinct performance obligation in a contract, the Company allocates the transaction price to the performance obligations on a relative standalone selling price basis. The Company estimates the amount of consideration expected to be received in exchange for transferring services if the consideration promised in a contract includes a variable amount. Revenue is generally recognized ratably over the contract term beginning on the commencement date of each contract, which is the date the Company's platform is made available to customers. Contracts are typically one year in length, but may be up to three years or longer in length. At the beginning of each subscription term the Company invoices its customers, typically in annual installments but also monthly, quarterly, and semi-annually. Amounts that have been invoiced for non-cancelable contracts are recorded in accounts receivable and in unearned revenue or revenue. The Company reports revenue net of sales tax and other taxes collected from customers to be remitted to government authorities. Costs Capitalized to Obtain Revenue Contracts The Company capitalizes costs of obtaining revenue contracts that are incremental and recoverable. Incremental costs primarily include sales commissions for new and renewal revenue contracts, certain related incentives, and associated payroll tax and fringe benefit costs. Capitalized amounts are recoverable through future revenue streams under all customer contracts. Costs capitalized to obtain new revenue contracts are amortized on a straight-line basis over three years , which reflects the average benefit period, and may be longer than the initial contract period. The Company determined the average benefit period having considered both qualitative and quantitative factors, including the estimated life of capitalized software development costs resulting from additional functionality to the Company's platform and estimated customer life, among other such factors. The Company amortizes costs capitalized for contract renewals over the renewal term, reflecting the average benefit period for such renewals, which is typically one year . Amortization of costs capitalized to obtain revenue contracts is included in sales and marketing expense in the accompanying consolidated statements of operations and comprehensive income (loss). The Company periodically evaluates whether there have been any changes in its business, market conditions, or other events which would indicate that its amortization period should be changed, or if there are potential indicators of impairment. During the fiscal years ended January 31, 2026 and 2025, the Company capitalized $ 24.1 million and $ 20.9 million of costs to obtain revenue contracts respectively, and amortized $ 26.3 million, $ 31.2 million and $ 36.4 million to sales and marketing expense as of January 31, 2026, 2025, and 2024, respectively. Costs capitalized to obtain revenue contracts on the Company's consolidated balance sheet totaled $ 31.0 million and $ 33.1 million at January 31, 2026 and 2025, respectively. There were no impairments of costs capitalized to obtain revenue contracts for the fiscal years ended January 31, 2026, 2025 and 2024, respectively. Cost of Revenue Cost of revenue is generally expensed as incurred, including personnel-related costs, costs associated with the Company’s Publisher Network application providers, and data center costs. Capitalized software development costs incurred in connection with additional functionality to the Company's platform are recognized in cost of revenue as depreciation expense in accordance with the “capitalized software development costs” section of this Note. Cost of revenue also includes amortization expense, which includes amounts related to intangible assets arising from acquisitions, as well as lease expenses and asset impairments associated with office spaces, which are allocated based on employee headcount. In addition, cost of revenue includes professional related costs and software expense, which relates to licenses, professional services, and other costs associated with software for use in the operations of the business, which is also allocated based on employee headcount. 71 Stock-Based Compensation Stock-based compensation for all employee stock-based awards, including restricted stock units, restricted stock, performance-based restricted stock units, and options to purchase common stock, is measured at fair value on the date of grant and recognized over the service period. The fair value of restricted stock units and restricted stock are estimated on the date of grant based on the fair value of the Company’s common stock. The fair value of performance-based restricted stock units are estimated on the date of grant for which the Company applies a Monte Carlo simulation model when the award contains market conditions. The fair value of employee stock options is estimated on the date of grant using a Black-Scholes option-pricing model. Stock-based compensation expense is generally recognized over the requisite service periods of awards, which is typically one to four years for restricted stock units, restricted stock and performance-based restricted stock units, and four years for options. The estimated forfeiture rate applied is based on historical forfeiture rates. The estimated number of stock-based awards that will ultimately vest requires judgment, and to the extent actual results, or updated estimates, differ from the Company’s current estimates, such amounts will be recorded as a cumulative adjustment in the period actual results are realized or estimates are revised. For awards containing performance conditions, stock-based compensation is recognized when it becomes probable that the underlying performance targets will be achieved. For awards containing market conditions, stock-based compensation is recognized over the requisite service period irrespective of whether the market conditions are achieved, provided the service requirement is fulfilled. Stock-based compensation expense associated with the Company's Employee Stock Purchase Plan (“ESPP”) is measured at fair-value using a Black-Scholes option-pricing model at commencement of each offering period and recognized over that offering period. The Company measures stock-based compensation associated with stock-based awards issued to non-employees at the grant date, based on the estimated fair value of the award, and recognizes expense on a straight-line basis over the requisite service period. The Company does not apply a forfeiture rate assumption to value such awards, given the nature of the services provided. Liability classified awards are remeasured at fair value at each reporting date until the award is settled. Advertising and Other Promotional Costs Advertising and other promotional costs are expensed as incurred. Advertising expenses were $ 0.9 million, $ 3.7 million and $ 3.9 million for the fiscal years ended January 31, 2026, 2025 and 2024, respectively and are included within sales and marketing expense in the consolidated statement of operations and comprehensive income (loss). Research and Development Research and development costs are generally expensed as incurred, including personnel-related costs. Research and development expenses also include data centers costs associated with pre-production costs for testing and quality assurance, as well as lease expenses and software expense, each of which are allocated based on employee headcount. Research and development costs exclude capitalized software development costs. Capitalized Software Development Costs The Company capitalizes certain software development costs included as software in progress or computer software within property and equipment, net. These costs are incurred in connection with additional functionality to the Company's platform, as well as internal-use projects during the application development stage and include elements of stock-based compensation. Computer software is recognized on a straight-line basis over an estimated useful life of 2 to 3 years. Capitalized software development costs incurred in connection with additional functionality to the Company's platform are recognized as depreciation expense in cost of revenue within the consolidated statement of operations and comprehensive income (loss). Capitalized software development costs incurred in internal-use projects are recognized as depreciation expense and are allocated based on employee headcount. Capitalized software development costs, net were $ 3.2 million and $ 2.1 million as of fiscal years ended January 31, 2026 and 2025, respectively, and primarily related to costs incurred in connection with additional functionality to the Company's platform. Depreciation expense associated with capitalized software development costs was $ 1.8 million during both the fiscal years ended January 31, 2026 and 2025 and $ 3.2 million for fiscal year ended January 31, 2024. Software costs that meet the cloud computing arrangements criteria are capitalized in accordance with ASC 350 “Intangibles—Goodwill and Other” and are recognized on a straight-line basis over the term of the arrangement, plus reasonably certain renewals. Capitalized costs included in prepaid expenses and other current assets were $ 0.4 million and $ 0.3 million as of January 31, 2026 and 2025 respectively, and $ 0.3 million, $ 0.5 million, and $ 1.0 million were amortized during the fiscal years ended January 31, 2026, 2025, and 2024, respectively. Software costs that do not meet the capitalization criteria, including costs incurred in the maintenance and minor upgrade and enhancement of software without additional functionality, are expensed as incurred. The Company evaluates the useful lives of these assets on an annual basis and tests for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. Income Taxes 72 The Company accounts for income taxes in accordance with ASC Topic 740, “Income Taxes,” under which deferred income taxes are provided for temporary differences between the financial reporting and tax basis of the Company’s assets and liabilities. The Company classifies all deferred tax assets and liabilities as non-current on the consolidated balance sheet. The effect of a change in tax rates on deferred tax assets and liabilities is recognized within the provision for income taxes on the consolidated statement of operations and comprehensive income (loss) in the period that includes the enactment date. The Company reduces deferred tax assets, if necessary, by a valuation allowance if it is more likely than not that the Company will not realize some or all of the deferred tax assets. In making such a determination, the Company considers all available positive and negative evidence, including results of recent operations, future reversals of existing taxable temporary differences, projected future taxable income and tax-planning strategies. See Note 13 "Income Taxes" for additional information on the composition of these valuation allowances. The Company recognizes the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by taxing authorities, based on the technical merits of the position. The tax benefit recognized is measured as the largest amount of benefit which is greater than 50 percent likely to be realized upon settlement with the taxing authority. The Company recognizes interest and penalties related to uncertain tax positions within the provision for income taxes on the consolidated statement of operations and comprehensive income (loss). Net Income (Loss) Per Share Basic net income (loss) per share is computed by dividing the net income (loss) attributable to common stockholders by the weighted average number of common shares outstanding during the period. Unvested restricted stock, restricted stock units and performance-based restricted stock units are excluded from the denominator of basic net income (loss) per share. Diluted net income (loss) per share is computed by dividing net income (loss) attributable to common stockholders by the weighted average number of common shares plus the common equivalent shares for the period, including any dilutive effect from such shares. See Note 16 "Net Income (Loss) Per Share Attributable to Common Stockholders" for further discussion. Foreign Currency The functional currency of the Company’s non-U.S. subsidiaries is generally the local currency. The Company translates the financial statements of its non-U.S. subsidiaries to U.S. dollars using month-end exchange rates for assets and liabilities, and average exchange rates for revenue, costs and expenses. The Company records translation gains and losses in accumulated other comprehensive (loss) income as a component of stockholders’ equity. Foreign currency transaction gains and losses are included within other expense, net in the consolidated statements of operations and comprehensive income (loss). Concentration of Credit Risk Certain financial instruments that could be exposed to a concentration of credit risk include cash and cash equivalents and accounts receivable. The Company deposits its cash with financial institutions, and such deposits, at times, may exceed federally insured limits. The Company has not experienced any losses on its deposits of cash and cash equivalents to date. Collateral is not required for accounts receivable. At January 31, 2026 and 2025, no single customer accounted for more than 10% of the Company's accounts receivable. No single customer accounted for more than 10% of the Company's total revenue for the fiscal years ended January 31, 2026, 2025 and 2024, respectively. Cash and Cash Equivalents Cash consists of cash on deposit with banks that is stated at cost, which approximates fair value. The Company considers all highly liquid investments purchased with original maturities of less than three months from the date of purchase to be cash equivalents. Restricted cash as of January 31, 2026, consists of $ 15.1 million related to collateralized amounts held in relation to leased offices, and funds held in escrow in connection with the acquisition of Places Scout for certain post-closing indemnification obligations. Marketable Securities The Company's investments in marketable securities may consist of debt securities, including U.S. treasury securities, corporate bonds, and commercial paper. The Company classifies marketable securities as available-for-sale at the time of purchase and reevaluates such classification as of each balance sheet date. The Company considers all of its investments in marketable securities, irrespective of the maturity date, as available for use in current operations, and therefore classifies these securities within current assets on the consolidated balance sheets. All marketable securities are carried at estimated fair value. Credit losses related to marketable securities are recorded, net in the consolidated statements of operations and comprehensive income (loss) through an allowance for credit losses rather than as a reduction in the amortized cost basis of the securities. As of January 31, 2026, 2025, and 2024 no credit losses related to marketable securities were recorded by the Company. Any remaining unrealized gains or losses for marketable securities are included in accumulated other comprehensive (loss) income, as a component of stockholders’ equity. 73 Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are carried at the original invoiced amount less an allowance for doubtful accounts based on the probability of future collection. The Company estimates its allowance for doubtful accounts based on historical loss patterns, the number of days that billings are past due, current market conditions, and reasonable and supportable forecasts of future economic conditions, in accordance with ASC 326 "Financial Instruments-Credit Losses." Accounts receivable are written off when deemed uncollectible and collection of the receivable is no longer being actively pursued. The following table summarizes the allowance for doubtful accounts activity: (in thousands) Fair Value Allowance for doubtful accounts as of January 31, 2024 $ 1,013 Additions 1,665 Additions related to Hearsay beginning balance at August 1, 2024 94 Deductions - write offs ( 758 ) Allowance for doubtful accounts as of January 31, 2025 2,014 Additions 3,078 Deductions - write offs ( 2,747 ) Allowance for doubtful accounts as of January 31, 2026 $ 2,345 Property and Equipment, Net Property and equipment are recorded at cost and depreciated or amortized on a straight-line basis over their estimated useful lives. Furniture and fixtures have an estimated useful life of five years . Office equipment has an estimated useful life of three years . Computer software, which includes capitalized software development costs, has an estimated useful life of two to three years . Leasehold improvements and assets held under operating leases are depreciated over the shorter of the term of the lease or their useful life. Upon retirement or sale of assets, the cost and related accumulated depreciation or amortization are removed from the consolidated balance sheet and the resulting gain or loss is reflected in the consolidated statement of operations and comprehensive income (loss). Repairs and maintenance costs are expensed as incurred. The Company evaluates the recoverability of property and equipment (including right-of-use assets) when events or changes in circumstances indicate a potential impairment exists. Events and changes in circumstances considered by the Company in determining whether the carrying value of long-lived assets may not be recoverable include, but are not limited to, significant changes in performance relative to expected operating results, significant changes in the use of the assets, significant negative industry or economic trends, and changes in the Company’s business strategy. Impairment testing is performed at an asset level that represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities (an “asset group”). In determining if impairment exists, the Company estimates the undiscounted cash flows to be generated from the use and ultimate disposition of the asset group. If the undiscounted cash flows for the asset group are less than its carrying value, an impairment loss is measured as the amount by which the carrying amount of the assets exceeds its fair value. Leases The Company accounts for leases in accordance with ASC Topic 842, "Leases." Lease expense is recognized as a single lease cost on a straight-line basis over the lease term. The lease term consists of non-cancelable periods, and may include options to extend or terminate the lease term, when it is reasonably certain such options will be exercised. The Company enters into contracts in the normal course of business and assesses whether any such contracts contain a lease. The Company determines if an arrangement is a lease at inception if it conveys the right to control the identified asset for a period of time in exchange for consideration. The Company classifies leases as operating or financing in nature, and records the associated lease liability and right-of-use asset on its balance sheet. The lease liability represents the present value of future lease payments, net of lease incentives, discounted using an incremental borrowing rate, which is a management estimate based on the information available at the commencement date of a lease arrangement. With respect to operating lease arrangements, the Company accounts for lease components, and non-lease components that are fixed, as a single lease component. Non-lease components that are variable are expensed as incurred in the statement of operations and comprehensive income (loss). The Company recognizes costs associated with lease arrangements having an initial term of 12 months or less ("short-term leases") on a straight-line basis over the lease term; such short-term leases are not recorded on the balance sheet. Goodwill and Intangible Assets Goodwill represents the excess of cost over the fair value of the net tangible and identifiable intangible assets acquired in a business combination. Goodwill is not amortized but is subject to periodic testing for impairment in accordance with ASC Topic 350, “Intangibles-Goodwill and Other.” The Company’s goodwill is evaluated at the entity level as it is determined there is one reporting unit. The Company performs its annual impairment test on November 1 st of each year, or more frequently if events occur or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. The 74 Company considers the following potential indicators of impairment: significant underperformance relative to historical or projected future operating results, significant changes in the Company’s use of acquired assets or the strategy of the Company’s overall business, significant negative industry or economic trends and a significant decline in the value of the Company’s enterprise value for a sustained period. A qualitative assessment is performed to determine whether it is more likely than not that the fair value of its reporting unit is less than its carrying amount. A quantitative assessment is performed if the qualitative assessment results in a more-likely-than-not determination or if a qualitative assessment is not performed. The quantitative assessment considers whether the carrying amount of a reporting unit exceeds its fair value, in which case an impairment charge is recorded to the extent that the reporting unit’s carrying value exceeds its fair value. Intangible assets are amortized over their estimated useful lives. The Company assesses the impairment of long-lived intangible assets whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. The Company has not recorded impairment charges on intangible assets for the periods presented in these consolidated financial statements. Legal and Other Contingencies From time to time, the Company may be a party to litigation and subject to claims incident to the ordinary course of business, including intellectual property claims, labor and employment claims, breach of contract claims and other asserted and unasserted claims. The Company investigates these claims as they arise and accrues estimates for resolution of legal and other contingencies when losses are probable and estimable. Recent Accounting Pronouncements In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which includes amendments that further enhance income tax disclosures, primarily through standardization and disaggregation of rate reconciliation categories and income taxes paid by jurisdiction. The Company adopted this accounting standard on January 31, 2026. See Note 13 "Income Taxes" for additional information. In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosure (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires disaggregated disclosures, in the notes to the financial statements, of certain categories of expenses that are included in expense line items on the face of the income statement. The updated standard is effective for the Company's annual periods beginning in fiscal 2028 and interim periods beginning in the first quarter of fiscal 2029. Early adoption is permitted. ASU 2024-03 is required to be applied prospectively, with retrospective application permitted. The Company is currently evaluating the impact of adopting ASU 2024-03. In September 2025, the FASB issued ASU 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, which removes all references to project stages throughout ASC 350-40 and clarifies the thresholds companies apply to begin capitalizing costs. The updated standard is effective for the Company's interim and annual periods beginning in fiscal 2029. The Company is currently evaluating the impact of adopting ASU 2025-06. 3. Revenue Geographic Region The Company disaggregates its revenue from contracts with customers by geographic region, as it believes this best depicts how the nature, amount, timing, and uncertainty of its revenues and cash flows are affected by economic factors. Revenue by geographic region is determined based on the region of the Company's contracting entity, which may be different than the region of its customers. The following table presents the Company's revenue by geographic region: Fiscal year ended January 31, (in thousands) 2026 2025 2024 North America $ 361,592 $ 336,323 $ 318,502 International 84,987 84,634 85,820 Total revenue $ 446,579 $ 420,957 $ 404,322 North America revenue is attributable to the United States. International revenue is predominantly attributable to European countries, but also includes Japan. The Company's revenue attributable to the United States represented 81 %, 80 %, and 79 % for the fiscal years ended January 31, 2026, 2025 and 2024, respectively. Revenue attributable to the United Kingdom, which serves as the Company's main contracting entity for Europe, represented 18 %, 19 % and 20 % of total revenue for the fiscal years ended January 31, 2026, 2025 and 2024, respectively. No other individual country represented more than 10% of total revenue during the fiscal years ended January 31, 2026, 2025 and 2024. 75 Significant Judgments Significant judgments and estimates may be required to determine the appropriate application of accounting related to revenue, including whether performance obligations are distinct and assessments regarding the transaction price. Performance Obligations The Company has identified that it has two distinct performance obligations. The Company predominantly recognizes revenue through its performance obligation of a subscription and associated support to the Company's platform. The performance obligation is distinct because a customer's use of the Company's platform is fully functional upon access, does not require any additional development, modification or customization, and is often sold separately. In certain instances, the Company enters into a contract with a customer that includes a promise to provide certain technical or customized professional services, in addition to a promise to provide its subscription and associated support. The Company's professional services performance obligation is distinct as it does not significantly change or enhance the functionality of the Company's platform. In those instances when a contract includes more than one performance obligation, the Company must allocate the transaction price to the performance obligations on a relative standalone selling price basis ("SSP"). SSP represents the price at which a company would sell a promised product or service separately to a customer. The Company determines the SSP based on a series of complex factors. The Company's selling prices associated with its subscription and associated support are considered highly variable based on discounting practices, customer geography, customer size, and other such factors. In contrast, the Company's selling prices associated with its professional services are more observable, predictable and consistent. Accordingly, the Company uses the residual method, under which the total transaction price and observable SSP of the professional services performance obligation is used to arrive at the estimated SSP of the subscription and associated support performance obligation. The Company's revenue is predominantly related to its subscription and associated support to the Company's platform. Professional services revenue accounted for approximately 6 %, 7 % and 8 % of the Company's total revenue for the fiscal years ended January 31, 2026, 2025 and 2024, respectively. Contract Assets The Company records a contract asset when revenue is recognized prior to being billed. Contract assets were $ 4.5 million and $ 1.7 million as of January 31, 2026 and 2025, respectively. Contract assets are included in prepaid expenses and other current assets on the consolidated balance sheet. Contract Liabilities A contract liability is an obligation to transfer goods or services for which consideration has been received or is due to a customer. The Company's contract liabilities consist primarily of unearned revenue and, to a lesser extent, customer deposits. As of January 31, 2026 and 2025, unearned revenue, current was $ 217.5 million and $ 229.1 million, while unearned revenue, non-current, which is included within other long term liabilities on the Company's consolidated balance sheet was $ 0.4 million and $ 0.6 million, respectively. Unearned revenue represents amounts billed, or payments received, in advance of revenue recognition for which the Company has an unconditional obligation to transfer goods or services associated with a non-cancelable contract. Unearned revenue is subsequently recognized as revenue when transfer of control to a customer has occurred. The unearned revenue balance is influenced by several factors, including seasonality, the compounding effects of renewals, and invoice duration, timing and size. The portion of unearned revenue expected to be recognized during the succeeding twelve-month period is classified as unearned revenue, current, and the remaining portion is classified within other long term liabilities in the Company’s consolidated balance sheet. Revenue recognized of $ 228.0 million during the fiscal year ended January 31, 2026 was included in unearned revenue, current as of January 31, 2025. Customer deposits represent payments received in advance in instances where a revenue contract is cancelable in nature, and therefore the Company does not have an unconditional obligation to transfer control to a customer. Customer deposits was $ 0.4 million and $ 0.2 million as of January 31, 2026 and 2025, respectively, and was included in accounts payable, accrued expenses and other current liabilities on the Company's consolidated balance sheet. Remaining Performance Obligations The transaction price allocated to remaining performance obligations represents amounts under non-cancelable contracts expected to be recognized as revenue in future periods, and may be influenced by several factors, including seasonality, the timing of renewals, and contract terms. As of January 31, 2026, the Company had $ 513.3 million of remaining performance obligations, of which $ 452.4 million is expected to be recognized as revenue over the next twenty-four months , with the remaining balance expected to be recognized thereafter. As of January 31, 2025, the Company had $ 490.1 million of remaining performance obligations. 76 4. Business Combination Hearsay Acquisition On August 1, 2024, Yext completed its acquisition of Hearsay pursuant to an Agreement and Plan of Merger dated June 10, 2024. At the effective time of the acquisition, each outstanding share of Hearsay stock was canceled and converted to a right to receive cash consideration, and Hearsay became a wholly owned subsidiary of Yext. The acquisition is intended to produce an end-to-end digital presence platform, combining Yext’s digital presence management capabilities with Hearsay's compliant engagement solutions across social media, websites, text, and voice. During the three months ended April 30, 2025, the Company finalized the accounting for its acquisition of Hearsay. The fair value of consideration transferred for Hearsay as of the acquisition date consisted of the following: (in thousands) Cash consideration and liabilities incurred $ 132,462 Contingent consideration (1) 39,800 Fair value of outstanding employee awards assumed 7,825 Other transaction related payments (2) 640 Total consideration transferred $ 180,727 (1) Inclusive of $ 0.3 million measurement period adjustment recorded during the three months ended April 30, 2025. (2) Inclusive of post-closing adjustments of less than $ 0.1 million. Cash consideration and liabilities incurred of $ 132.5 million includes the base purchase price of $ 125.0 million and customary adjustments set forth in the merger agreement. The cash consideration includes $ 17.2 million of payments held in escrow as partial security for certain indemnification obligations of the former holders of Hearsay equity. Amounts held in escrow were reflected on the Company's consolidated balance sheet at the acquisition date within restricted cash (current and non-current) as the funds are owned by the Company until settlement. In connection with the amounts held in escrow, the Company recognized a corresponding liability on its consolidated balance sheet at the acquisition date at its present value of $ 16.6 million to reflect the amounts payable to former Hearsay equity holders following the resolution of contingencies surrounding the amounts held in escrow. The liability will be accreted to its contractual value over the estimated escrow period with changes in the liability being recorded within interest expense on the Company's consolidated statements of operations and comprehensive income (loss). During the three months ended April 30, 2025 interest expense of $ 0.5 million was recognized, which encompassed all remaining accretion. As of January 31, 2026, all escrow amounts have been fully released with the corresponding cash outflows being categorized as deferred acquisition payments in the Company's consolidated statement of cash flows. The purchase price also includes $ 39.8 million of contingent consideration related to an earnout arrangement, inclusive of a $ 0.3 million measurement period adjustment recorded during the three months ended April 30, 2025 based on refined estimates. Under the terms of the earnout arrangement, the Company may be required to pay up to $ 75.0 million to the former holders of Hearsay's outstanding equity interests, subject to the achievement of certain Annual Recurring Revenue ("ARR") milestones over a two-year period which will end in September 2026. The portion of the earnout arrangement included within contingent consideration excludes amounts attributable to employees of Hearsay that held unvested awards as of the acquisition date, for which earnout payments are subjected to future service. Accordingly, these amounts represent compensation expense in the post-acquisition period. Payment of the earnout can be settled in cash or shares at the Company's election. As the first year of the earnout lapsed, the Company was required to pay $ 10.5 million, of which $ 8.6 million was paid as of January 31, 2026, and the remaining $ 1.9 million was paid in February 2026. The Company estimated the fair value of the contingent consideration as of the acquisition date. This estimate incorporated projected ARR values inclusive of revenue synergies and growth rates, as well as other key inputs. The key inputs as of the acquisition date are outlined below: Volatility 15 % Revenue beta 0.35 Expected timing of payment FY 2026 - FY 2027 Discount rate 5.90 % - 6.20 % See Note 6 "Fair Value of Financial Instruments" for additional details on the fair value of contingent consideration. The Company also issued approximately 2.1 million replacement equity awards with a fair value of $ 11.8 million, of which (i) $ 7.8 million was allocated to consideration transferred for pre-acquisition services, inclusive of employer related payroll taxes, and (ii) $ 4.2 million was allocated to the post-acquisition period and expensed over the remaining requisite service period associated with the awards. The value attributed to consideration transferred was based on the fair value of Hearsay options prior to the exchange. Approximately 1.5 million equity awards that were granted also vested on the acquisition date, and $ 0.6 million was recognized in the 77 post-acquisition period immediately to reflect the excess of the fair value of the replacement awards over the fair value of the Hearsay options. These awards were subsequently net settled, which represents an event that is separate from the acquisition. In addition, the Company recognized other transaction related payments of $ 0.6 million in the consideration which are comprised primarily of post-closing adjustments, including working capital. The Company is also required to make additional payments related to a $ 20.0 million incentive pool that can be settled in cash or shares at the Company's election, shortly after the first anniversary of the acquisition date. Approximately $ 8.8 million of this pool is to be paid to Hearsay founders and early employees, and is not contingent on future service being provided. This amount was recognized immediately in the post-acquisition period in operating expenses, within general and administrative expenses on the Company's consolidated statements of operations and comprehensive income (loss). The remaining amount of the incentive pool is allocated to employees generally subject to continued employment of one-year from the acquisition date. In addition, a transaction bonus of $ 1.5 million is payable to individuals determined by Hearsay and deemed to be compensation expense attributable to the post-acquisition period. Amounts attributable to the remaining incentive pool and transaction bonus will be expensed in the post-Acquisition period over the requisite service period. As of September 1, 2025, all remaining payments related to the incentive pool were settled in cash for $ 18.2 million. In aggregate, incentive pool payments totaled $ 19.9 million, with forfeitures amounting to $ 0.1 million. Acquisition-related costs related to Hearsay totaled $ 11.2 million for the fiscal year ended January 31, 2026. These costs were expensed as incurred and include $ 8.8 million related to the portion of the incentive pool attributable to Hearsay founders and early employees, as well as professional fees. Acquisition-related costs are presented within general and administrative expense in the Company's consolidated statement of operations and comprehensive income (loss). The following table summarizes the purchase price allocation of the fair values of the assets acquired and liabilities assumed at the acquisition date: (amounts in thousands) Assets acquired: Cash and cash equivalents $ 26,362 Accounts receivable, net 5,619 Prepaid expenses and other current assets 2,454 Property and equipment, net 399 Operating lease right-of-use assets 414 Other long term assets (1) 5,942 Liabilities assumed: Accounts payable, accrued expenses, and other current liabilities ( 5,127 ) Operating lease liabilities, current ( 74 ) Unearned revenue, current ( 37,672 ) Operating lease liabilities, non-current ( 340 ) Other long term liabilities (1)(2) ( 11,340 ) Identifiable intangible assets acquired (3) 101,850 Net assets acquired $ 88,487 Goodwill $ 92,240 Total consideration (4)(5) $ 180,727 (1) Other long term assets includes a $ 5.9 million indemnification asset, with the underlying indemnified liability of $ 6.2 million recorded within other long term liabilities. (2) Included within other long term liabilities is a deferred tax liability of $ 3.6 million. (3) Inclusive of measurement period adjustments of $ 0.7 million recorded during the three months ended April 30, 2025. (4) Inclusive of post-closing adjustments of less than $ 0.1 million. (5) Inclusive of measurement period adjustments of $ 0.3 million related to contingent consideration recorded during the three months ended April 30, 2025. The Company determined the fair value of assets acquired and liabilities assumed by using available market information and various valuation methods that require judgment related to estimates. During the fiscal year ended January 31, 2026, the Company refined its estimates pertaining to the valuation of intangibles which resulted in an increase of $ 9.9 million in intangible assets, a $ 1.7 million increase in deferred tax liabilities, as well as an increase to the useful life of the customer relationships from 12 years to 13 years. During the three months ended April 30, 2025, the Company further refined its estimates in connection with finalizing its valuation of intangible assets. Additional measurement period adjustments were recorded resulting in an increase of $ 0.7 million in 78 intangible assets and a $ 0.2 million increase in deferred tax liabilities. See Note 7 "Goodwill and Intangible Assets" for additional information. Pursuant to the terms of the merger agreement, the Company was indemnified by the sellers for the pre-acquisition contingent liability assumed in the acquisition associated with the Canadian Good and Services Tax (“GST”) and Harmonized sales tax (“HST”) related to certain historical foreign sales transactions. The indemnification of the indirect tax liability is capped at $ 5.9 million and an escrow fund was established in the same amount. At the acquisition date, the associated indirect tax liability was recorded at the estimated fair value of $ 6.2 million within other long term liabilities, and the Company recorded an indemnification asset up to the amount of the escrow fund balance of $ 5.9 million. In October 2024, initial filings to settle this matter with the Canada Revenue Agency were initiated and to date, payments of $ 2.0 million have been made. During the three months ended April 30, 2025, the Company was notified by the Canada Revenue Agency that the matter was effectively settled, at which point the remaining indirect tax liability was released. Goodwill represents the excess of the purchase consideration over the fair value of the underlying net identifiable assets and is attributable primarily to expected synergies and the assembled workforce of Hearsay. Goodwill is not deductible for income tax purposes. Intangible Assets The following table sets forth the amounts, allocated to the intangible assets identified and their estimated useful lives as of the acquisition date: Identifiable Intangible Assets Acquired Fair Value (In thousands) Estimated Useful Life (In years) Classification of Amortization Customer relationships $ 76,200 13 Sales and marketing Technology 24,800 3 Cost of revenue Trademark 850 3 Sales and marketing Total $ 101,850 The fair values of the identifiable intangible assets are based on management’s estimates as of the acquisition date. The fair value of the intangible assets was determined using the excess earnings method and the relief from royalty method, under the income approach. The Company applied judgment in estimating the fair value of customer relationships using the excess earnings method, which involved the use of significant assumptions with respect to revenue, EBITDA, attrition rate, research and development addback, technology royalty rate, and discount rate. The fair value of the developed technology and trademark was estimated using the relief from royalty method, which incorporates assumptions including royalty rates, annual obsolescence, tax rates, and discount rates. Pro Forma Results The unaudited pro forma financial information presented below was derived from historical financial records of Yext and Hearsay and presents the operating results for the periods presented as if the acquisition occurred on February 1, 2023. The pro forma results include adjustments to record additional compensation expense, adjust commission expense, and adjust for the impact of purchase accounting adjustments including amortization and depreciation expense, and the related tax effects. Accordingly, the following unaudited pro forma results are presented for informational purposes only and are not necessarily indicative of what the actual results of operations of the combined company would have been if the acquisition had occurred at the beginning of fiscal year 2025, nor are they indicative of future results of operations: (in thousands) Fiscal Year Ended January 31, 2025 Revenue $ 452,129 Net loss $ ( 25,225 ) 79 Places Scout Acquisition On February 7, 2025, the Company completed its acquisition of KabanaSoft, LLC, doing business as Places Scout (“Places Scout”), for a purchase price of $ 20.3 million in cash, subject to customary adjustments as set forth in the Unit Purchase Agreement. The acquisition strengthens the Company's ability to provide best-in-class competitive intelligence, benchmarking, and AI-powered insights. The purchase price of $ 20.3 million was allocated to intangible assets including technology and customer relationships, totaling $ 5.6 million and $ 0.9 million, respectively, and the remaining $ 13.8 million was allocated to goodwill. The goodwill recognized is deductible for income tax purposes. In connection with the acquisition, the Company also agreed to grant approximately $ 10.0 million of incentive equity awards to certain key employees of Places Scout. These awards are subject to continued employment and are expensed in the post-acquisition period over the requisite service period associated with the awards of two years . Pro forma results of operations for this acquisition were not presented as the effects were not material to the Company's financial results. 5. Investments in Marketable Securities The following tables summarize the Company's investments in marketable securities: January 31, 2026 (in thousands) Amortized Cost Unrealized Gains Unrealized Losses Fair Value Money market funds $ 36,227 $ — $ — $ 36,227 Commercial paper 29,904 — ( 9 ) 29,895 U.S. treasury securities 29,876 — — 29,876 Total marketable securities $ 96,007 $ — $ ( 9 ) $ 95,998 January 31, 2025 (in thousands) Amortized Cost Unrealized Gains Unrealized Losses Fair Value Money market funds $ 36,371 $ — $ — $ 36,371 Total marketable securities $ 36,371 $ — $ — $ 36,371 As of January 31, 2026 and 2025, the Company's marketable securities have a maturity of 90 days or less and are classified as cash and cash equivalents. During the fiscal years ended January 31, 2026, 2025 and 2024, the Company had no material reclassification adjustments from accumulated other comprehensive (loss) income to net income. The Company classifies interest income on investments in marketable securities, amortization of premiums and discounts, and realized gains and losses on securities available for sale within interest income in the consolidated statements of operations and comprehensive income (loss). The Company regularly reviews its debt securities and monitors the surrounding economic conditions to assess the risk of expected credit losses. As of January 31, 2026 and 2025, the unrealized losses and the related risk of expected credit losses were not significant. 6. Fair Value of Financial Instruments Fair value is the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Subsequent changes in fair value of these financial assets and liabilities are recognized in earnings or other comprehensive (loss) income when they occur. When determining the fair value measurements for assets and liabilities which are required to be recorded at fair value, the Company considers the principal or most advantageous market in which the Company would transact and the market-based risk measurement or assumptions that market participants would use in pricing the assets or liabilities, such as inherent risk, transfer restrictions, and credit risk. The Company applies the following fair value hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement: Level 1 inputs are based on quoted prices in active markets for identical assets or liabilities. Level 2 inputs are based on observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets with insufficient volume or infrequent transactions (less active markets); or model-derived 80 valuations in which all significant inputs are observable or can be derived principally from or corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 inputs are based on unobservable inputs to the valuation methodology that are significant to the measurement of fair value of assets or liabilities, and typically reflect management's estimates of assumptions that market participants would use in pricing the asset or liability. The Company's assets and liabilities measured at fair value on a recurring basis, by level, within the fair value hierarchy are as follows: January 31, 2026 (in thousands) Level 1 Level 2 Level 3 Total Assets: Money market funds $ 36,227 $ — $ — $ 36,227 Commercial paper — 29,895 — 29,895 U.S. treasury securities — 29,876 — 29,876 Total assets $ 36,227 $ 59,771 $ — $ 95,998 Liabilities: Contingent consideration $ — $ — $ 8,200 $ 8,200 Total liabilities $ — $ — $ 8,200 $ 8,200 January 31, 2025 (in thousands) Level 1 Level 2 Level 3 Total Assets: Money market funds $ 36,371 $ — $ — $ 36,371 Total assets $ 36,371 $ — $ — $ 36,371 Liabilities: Contingent consideration $ — $ — $ 45,000 $ 45,000 Total liabilities $ — $ — $ 45,000 $ 45,000 The Company’s cash equivalents and marketable securities for the periods presented were valued using quoted market prices or alternative pricing sources and models utilizing observable market inputs and were classified as Level 1 or Level 2, accordingly. The Company measured its contingent consideration associated with the Hearsay acquisition, on a recurring basis using significant unobservable inputs, classified as Level 3. Contingent Consideration The Company records contingent consideration resulting from a business combination at its fair value on the acquisition date. The Company generally determines the fair value of contingent consideration using the Real Options Method that employs a Monte Carlo simulation model. Each reporting period thereafter, these obligations are revalued and changes in their fair values are recorded within general and administrative expenses within the consolidated statements of operations and comprehensive income (loss). Changes in the fair value of the contingent consideration can result from changes in assumed discount periods and rates, and from changes pertaining to the estimated or actual achievement of the defined milestones. Significant judgment is employed in determining the appropriateness of these assumptions as of the acquisition date and for each subsequent period. Accordingly, future business and economic conditions, as well as changes in any of the assumptions described above, can materially impact the fair value and corresponding changes in fair value of the contingent consideration the Company records in any given period. In connection with the Hearsay acquisition, the estimated fair value of the contingent consideration incorporates projected ARR values inclusive of revenue synergies and growth rates, as well as other key inputs. The key inputs as of January 31, 2026 are outlined below: Volatility 12.9 % Revenue beta 0.29 Expected timing of payment FY 2027 Discount rate 8.84 % - 8.90 % 81 A rollforward of the fair value of the contingent consideration liability for the fiscal year ended January 31, 2026 is as follows: (in thousands) Balance as of January 31, 2025 $ 45,000 Measurement period adjustment 300 Changes in fair value (1) ( 28,600 ) Payments made in the period ( 8,500 ) Balance as of January 31, 2026 $ 8,200 (1) Changes in fair value during fiscal year ended January 31, 2026, were primarily driven by a decline in the estimated achievement of the defined milestones. 7. Goodwill and Intangible Assets Goodwill Goodwill is not amortized but is subject to periodic testing for impairment at the reporting unit level, which is at or one level below the operating segment level. The Company operates as one operating segment, which represents its one reporting unit. The test for impairment is conducted annually each November 1 st , or more frequently if events occur or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. On February 7, 2025, the Company completed its acquisition of Places Scout and during the three months ended April 30, 2025, the Company recorded additional measurement period adjustments upon finalizing the accounting for its acquisition of Hearsay, which resulted in the following changes in the carrying amount of goodwill. See Note 4 "Business Combinations" for additional information. The following table presents a reconciliation of the beginning and ending balances of goodwill: (in thousands) Balance as of January 31, 2025 $ 96,782 Goodwill acquired - Places Scout 13,801 Measurement period adjustments related to Hearsay acquisition ( 189 ) Effect of foreign currency translation on Goodwill acquired 407 Balance as of January 31, 2026 $ 110,801 The Company determined that no events occurred or circumstances changed that would more likely than not reduce the fair value of the Company's reporting unit below its carrying amount during the reporting periods ended January 31, 2026, and 2025. However, if certain events occur or circumstances change, it may be necessary to record impairment charges in the future. Intangible Assets The Company’s intangible assets with definite lives are amortized on a straight-line basis over their estimated useful lives, which range from approximately 2 to 15 years. Intangible assets with finite lives are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. The Company has no indefinite-lived intangible assets. The Company determined that no events occurred or circumstances changed during the reporting periods ended January 31, 2026 and 2025 that would indicate that its intangible assets with finite lives may not be recoverable. However, if certain events occur or circumstances change, it may be necessary to record impairment charges in the future. Amortization expense was $ 16.3 million and $ 7.1 million for the fiscal years ended January 31, 2026 and 2025, respectively, and less than $ 0.1 million for the fiscal year ended January 31, 2024. 82 The gross carrying amount and accumulated amortization of intangible assets other than goodwill are as follows: As of January 31, 2026 (in thousands) Gross Carrying Amount Accumulated Amortization Net Carrying Value Weighted Average Remaining Useful Life Domains $ 365 $ ( 245 ) $ 120 5.1 Customer relationships (1) 77,100 ( 9,392 ) 67,708 11.5 Technology (2) 30,400 ( 13,520 ) 16,880 2.2 Trademarks (3) 850 ( 425 ) 425 1.5 Total as of January 31, 2026 $ 108,715 $ ( 23,582 ) $ 85,133 9.5 As of January 31, 2025 (in thousands) Gross Carrying Amount Accumulated Amortization Net Carrying Value Weighted Average Remaining Useful Life Domains $ 365 $ ( 221 ) $ 144 6.0 Customer relationships 76,200 ( 2,931 ) 73,269 12.5 Technology 24,200 ( 4,033 ) 20,167 2.5 Trademarks 800 ( 133 ) 667 2.5 Total as of January 31, 2025 $ 101,565 $ ( 7,318 ) $ 94,247 10.1 (1) Includes amounts recognized in connection with the acquisitions of Hearsay and Places Scout of $ 76.2 million and $ 0.9 million, respectively. (2) Includes amounts recognized in connection with the acquisitions of Hearsay and Places Scout of $ 24.8 million and $ 5.6 million, respectively. (3) Includes amounts recognized in connection with the acquisition of Hearsay of $ 0.9 million. The estimated future aggregate amortization expense as of January 31, 2026 is as follows (in thousands): Fiscal Year Ending January 31, 2027 $ 15,856 2028 11,281 2029 7,005 2030 7,004 2031 5,882 2032 and thereafter 38,105 Total $ 85,133 83 8. Property and Equipment, Net Property and equipment are recorded at cost and depreciated or amortized on a straight-line basis over their estimated useful lives. Property and equipment, net consisted of the following: (in thousands) January 31, 2026 January 31, 2025 Computer software $ 26,839 $ 24,086 Office equipment 23,907 23,529 Furniture and fixtures 7,133 7,894 Leasehold improvements 57,983 59,944 Construction in progress 33 27 Software in progress 687 548 Total property and equipment, gross 116,582 116,028 Less: accumulated depreciation ( 86,494 ) ( 76,339 ) Total property and equipment, net $ 30,088 $ 39,689 As of January 31, 2026 and 2025, the Company's property and equipment, net attributable to the United States was 93 % and 91 %, respectively. No other individual country represented more than 10% of the total property and equipment, net as of those periods. Depreciation expense was $ 10.7 million, $ 11.4 million and $ 15.8 million for the fiscal years ended January 31, 2026, 2025 and 2024, respectively. During the fiscal year ended January 31, 2026, the Company subleased a floor related to its corporate headquarters and was in the process of subleasing an additional floor as of January 31, 2026. In connection with these arrangements, the Company recorded a $ 2.1 million impairment loss related to leasehold improvements. See Note 14 "Leases" for additional information. 9. Accounts Payable, Accrued Expenses and Other Current Liabilities Accounts payable, accrued expenses and other current liabilities consisted of the following: (in thousands) January 31, 2026 January 31, 2025 Accounts payable $ 5,833 $ 4,771 Accrued employee compensation (1) 26,129 29,153 Accrued Publisher Network fees 2,701 4,051 Accrued professional services and associated costs 2,734 3,131 Accrued employee stock purchase plan withholdings liability 1,253 1,565 Other current liabilities (2)(3) 13,878 27,351 Total accounts payable, accrued expenses and other current liabilities $ 52,528 $ 70,022 (1) As of January 31, 2026 and January 31, 2025, accrued employee compensation included $ 0.7 million and $ 8.6 million, respectively, related to the portion of the incentive pool and other retention arrangements where continuing service is required arising from the Hearsay acquisition. (2) As of January 31, 2025, other current liabilities included $ 9.7 million payable to Hearsay owners in connection with escrow funds held by Yext related to indemnity claims in connection with the Hearsay acquisition. During the fiscal year ended January 31, 2026, the escrow balances were fully released and the corresponding liabilities were settled. (3) As of January 31, 2025, other current liabilities included $ 8.8 million, related to the incentive pool allocated to founders and early employees in connection with the Hearsay acquisition. Payments to settle this liability were made during the fiscal year ended January 31, 2026. 10. Stock-Based Compensation 2008 Equity Incentive Plan The Company's 2008 Equity Incentive Plan (the "2008 Plan"), as amended on March 10, 2016, allowed for the issuance of up to 25,912,531 shares of common stock. Awards granted under the 2008 Plan may be incentive stock options ("ISOs"), nonqualified stock options ("NQSOs"), restricted stock and restricted stock units. The 2008 Plan is administered by the Company's Board of Directors, which determines the terms of the options granted, the exercise price, the number of shares subject to option and the option vesting period. No ISO or NQSO is exercisable after 10 years from the date of grant, and option awards will typically vest over a four-year period. The 2008 Plan was terminated in connection with the adoption of the Company's 2016 Equity Incentive Plan (the "2016 Plan") in December 2016, and since the 2008 Plan termination the Company has not granted and will not grant any additional awards under the 2008 Plan. However, the 2008 Plan will continue to govern the terms and conditions of the outstanding awards previously granted thereunder. 2016 Equity Incentive Plan 84 In December 2016, the Company's Board of Directors adopted, and its stockholders approved, the 2016 Plan. The number of shares reserved for issuance under the 2016 Plan will increase on the first day of each fiscal year during the term of the 2016 Plan by the lesser of: (i) 10,000,000 shares, (ii) 4 % of the outstanding shares of common stock as of the last day of the immediately preceding fiscal year; or (iii) such other amount as the Company's Board of Directors may determine. On February 1, 2025, the number of shares of common stock available for issuance under the 2016 Plan was automatically increased according to its terms by 5,079,978 shares. In addition, the shares reserved for issuance under the 2016 Plan also include shares returned to the 2008 Plan as the result of expiration or termination of options or other awards. As of January 31, 2026, the number of shares available for future award under the 2016 Plan is 12,842,891 . Hearsay Social, Inc. 2019 Equity Incentive Plan In connection with the acquisition, the Company assumed the Hearsay Social, Inc. 2019 Equity Incentive Plan (the "Hearsay Plan"), including all outstanding restricted stock units ("RSUs") held by continuing Hearsay employees. These assumed awards were converted into approximately 2.1 million RSUs to receive shares of the Company’s common stock at the effective time of the acquisition and are generally subject to their original terms and conditions under the Hearsay Plan. The Hearsay Plan allows for the issuance of up to approximately 6.0 million shares of the Company’s common stock. Under the Hearsay Plan, the Company may grant stock options with an exercise price that is no less than the fair market value on the date of grant, restricted stock, RSUs, and other stock-based awards to the Company’s employees. Equity awards granted under the Hearsay Plan following the acquisition are expected to be on similar terms and consistent with similar grants made pursuant the Company’s 2016 Equity Incentive Plan. Awards canceled and forfeited and shares withheld to satisfy tax withholding obligations become further available for future issuance under the Hearsay Plan. As of January 31, 2026, the number of shares available for future award under the Hearsay Plan is 1,229,221 . Stock-Based Compensation Expense Stock-based compensation represents the cost related to stock-based awards granted in lieu of monetary payment. The Company measures stock-based compensation associated with stock-based awards issued to employees at the grant date, based on the estimated fair value of the award, and recognizes expense, net of estimated forfeitures, over the requisite service period of the applicable award generally using the straight-line method or accelerated attribution method. The following table summarizes the Company's stock-based compensation expense for equity classified awards for the periods presented: Fiscal year ended January 31, (in thousands) 2026 2025 2024 Equity classified awards: Cost of revenue $ 2,624 $ 2,753 $ 2,900 Sales and marketing 7,400 15,583 15,067 Research and development 13,843 10,265 11,349 General and administrative 24,844 23,179 15,645 Total stock-based compensation expense $ 48,711 $ 51,780 $ 44,961 During the fiscal years ended January 31, 2026, 2025 and 2024, the Company capitalized $ 0.4 million, $ 0.3 million and $ 0.3 million, respectively, of stock-based compensation related to software development. As of January 31, 2026, there was approximately $ 47.8 million of total unrecognized compensation cost related to unvested stock-based awards, which is expected to be recognized over an estimated remaining weighted-average vesting period of approximately 1.78 years. In addition, certain liability classified awards were granted in connection with the Hearsay acquisition and relate to portions of the incentive pool and earnout that generally vest over one year from the Hearsay acquisition date. These awards may be settled in cash or shares at the Company's election, and are measured at fair value at each reporting date based on their expected value, with compensation cost being recognized over the related service period. The corresponding liabilities associated with these awards are included within accounts payable, accrued expenses and other current liabilities on the Company's consolidated balance sheet until settlement. The following table summarizes the Company's compensation expense for liability classified awards for the periods presented: 85 Fiscal year ended January 31, (in thousands) 2026 2025 2024 Liability classified awards: Cost of revenue $ 720 $ 201 $ — Sales and marketing 603 5,782 — Research and development 1,234 2,419 — General and administrative 239 703 — Total compensation expense $ 2,796 $ 9,105 $ — Stock Options The following table summarizes the activity related to the Company's stock options: Options Outstanding Outstanding Stock Options Weighted-Average Exercise Price Weighted-Average Remaining Contractual Life (in years) Aggregate Intrinsic Value (in thousands) Balance, January 31, 2025 1,566,134 $ 6.78 1.48 $ 450 Granted — $ — Exercised ( 341,553 ) $ 6.31 Forfeited or canceled ( 45,767 ) $ 10.81 Balance, January 31, 2026 1,178,814 $ 6.75 0.56 $ 665 Vested and expected to vest 1,178,814 $ 6.75 0.56 $ 665 Exercisable at January 31, 2026 1,178,814 $ 6.75 0.56 $ 665 The aggregate intrinsic value of options vested and expected to vest and exercisable is calculated based on the difference between the exercise price and the fair value of the Company’s common stock as of January 31, 2026. The fair value of the common stock is the Company’s closing stock price as reported on the New York Stock Exchange. The aggregate intrinsic value of exercised options was $ 0.7 million, $ 0.8 million and $ 6.3 million for the fiscal years ended January 31, 2026, 2025 and 2024, respectively, and is calculated based on the difference between the exercise price and the fair value of the Company’s common stock as of the exercise date. Restricted Stock and Restricted Stock Units The following table summarizes the activity related to the Company's restricted stock and restricted stock units ("RSUs"): Outstanding Weighted-Average Grant Date Fair Value Balance, January 31, 2025 10,315,199 $ 6.37 Granted 6,269,951 $ 7.72 Vested and converted to shares ( 6,903,945 ) $ 6.21 Forfeited or canceled ( 2,073,344 ) $ 6.85 Balance, January 31, 2026 7,607,861 $ 7.51 The estimated weighted-average grant date fair value of restricted stock and RSUs granted was $ 7.72 , $ 5.85 , and $ 8.28 per share for the fiscal years ended January 31, 2026, 2025, and 2024, respectively. The fair value of the common stock is the Company’s closing stock price as reported on the New York Stock Exchange. The total fair value of restricted stock and RSUs vested was $ 42.9 million, $ 40.6 million, and $ 40.7 million for the fiscal years ended January 31, 2026, 2025, and 2024, respectively. Employee Stock Purchase Plan The Company offers an ESPP to eligible employees. The ESPP allows employees to purchase shares of common stock at a 15 % discount, based on the lower of the fair market value per share at the commencement of or completion of the offering period. Offering periods commence on the first trading day on or after March 15 th and September 15 th of each year, and end on the first trading day, approximately six months later. 86 In connection with the offering period which ended on March 15, 2025, 355,981 shares of common stock were purchased under the ESPP at a purchase price of $ 5.24 per share for total proceeds of $ 1.9 million. In connection with the offering period which ended on September 15, 2025, 248,723 shares of common stock were purchased under the ESPP at a purchase price of $ 5.24 per share for total proceeds of $ 1.3 million. The Black-Scholes option-pricing model assumptions used to calculate the fair value of shares, estimated at commencement of the offering period, were as follows: Fiscal year ended January 31, 2026 2025 2024 Expected life (years) 0.50 0.50 0.50 Expected volatility 41.28 % - 50.80 % 46.36 % - 52.80 % 55.12 % - 76.43 % Dividend yield — % — % — % Risk-free rate 3.81 % - 4.29 % 4.55 % - 5.38 % 4.73 % - 5.49 % During the fiscal years ended January 31, 2026, 2025 and 2024, the Company recorded stock-based compensation expense associated with the ESPP of $ 1.0 million, $ 1.4 million and $ 1.7 million, respectively. As of January 31, 2026, total unrecognized compensation cost related to the ESPP was $ 0.1 million, net of estimated forfeitures, which will be amortized over a weighted-average remaining period of 0.12 years. Performance-Based Restricted Stock Units In March 2022, the Company made a grant to an executive in the form of 2,000,000 performance-based restricted stock units ("PSUs"). This grant was outside of the Company’s 2016 Equity Incentive Plan, and will vest over approximately a four-year period following the achievement of certain stock price targets. During the fiscal year ended January 31, 2024, the Company granted additional PSUs to certain executives under the Company’s 2016 Equity Incentive Plan, which vest over approximately a one-year period following the achievement of certain stock price targets. In January 2024, the Company made an additional grant to an executive in the form of 1,250,000 target PSUs under the 2016 Equity Incentive Plan. The total number of shares that will be eligible to vest ranges from 0 % to 200 % of the target PSUs and is based on the total shareholder return ("TSR") of the Company, relative to the TSR of companies in the S&P Software and Services Select Index over specified performance periods. These awards vest over approximately a one to two-year period. During the fiscal year ended January 31, 2026, the Company granted 1,025,000 PSUs to certain executives which vest over approximately a two-year period based upon continued service and the achievement of pre-determined ARR and Adjusted EBITDA margin growth metrics. The total number of shares that are eligible to vest ranges from 0 % to 250 % of the target PSUs. The Company measures the fair value of PSUs on the grant date of the award and applies a Monte Carlo simulation model when the award contains market conditions. Stock-based compensation expense is recognized using the accelerated attribution method over the requisite service period. For PSUs with performance conditions, stock-based compensation is recognized when it becomes probable that the underlying performance targets will be achieved. The following table summarizes the activity related to the Company’s PSUs: Number of Performance-Based Restricted Stock Units Weighted-Average Grant Date Fair Value Balance as of January 31, 2025 3,495,000 $ 5.97 Granted 1,025,000 $ 7.17 Vested ( 391,875 ) $ 5.69 Forfeited or canceled ( 303,125 ) $ 6.11 Balance as of January 31, 2026 3,825,000 $ 6.31 During the fiscal years ended January 31, 2026, 2025 and 2024, the Company recognized stock-based compensation expense related to PSUs of approximately $ 9.1 million, $ 8.3 million and $ 4.6 million, respectively. As of January 31, 2026, the total unrecognized stock-based compensation expense related to unvested PSUs was $ 3.0 million, which will be amortized over a weighted-average remaining period of 0.79 years. 87 11. Equity Preferred Stock Effective April 2017, the Company’s Board of Directors is authorized to issue up to 50,000,000 shares of preferred stock, $ 0.001 par value, in one or more series without stockholder approval. The Company's Board of Directors has the discretion to determine the rights, preferences, privileges and restrictions, including voting rights, dividend rights, conversion rights, redemption privileges and liquidation preferences, of each series of preferred stock. The issuance of preferred stock could have the effect of restricting dividends on the Company’s common stock, diluting the voting power of its common stock, impairing the liquidation rights of its common stock, or delaying or preventing changes in control or management of the Company. As of January 31, 2026 and 2025, no shares of preferred stock were issued or outstanding. Common Stock As of January 31, 2026 and 2025, the Company had authorized 500,000,000 shares of voting $ 0.001 par value common stock. Each holder of the Company's common stock is entitled to one vote for each share on all matters to be voted upon by the stockholders and there are no cumulative rights. Subject to any preferential rights of any outstanding preferred stock, holders of the Company's common stock are entitled to receive ratably the dividends, if any, as may be declared from time to time by the Company's Board of Directors out of legally available funds. If there is a liquidation, dissolution or winding up of the Company, holders of the Company's common stock would be entitled to share in the Company's assets remaining after the payment of liabilities and any preferential rights of any outstanding preferred stock. Holders of the Company's common stock have no preemptive or conversion rights or other subscription rights, and there are no redemption or sinking fund provisions applicable to the common stock. All outstanding shares of the Company's common stock will be fully paid and non-assessable. The rights, preferences and privileges of the holders of the Company's common stock are subject to, and may be adversely affected by, the rights of the holders of shares of any series of preferred stock which the Company may designate and issue in the future. Treasury Stock As of January 31, 2026, the Company had 35,435,631 shares of treasury stock carried at its cost basis of $ 197.8 million . As of January 31, 2025, the Company had 26,017,782 shares of treasury stock carried at its cost basis of $ 130.3 million. Share Repurchase Program In March 2022, the Company's Board of Directors authorized a $ 100.0 million share repurchase program of the Company’s common stock, which was increased by an additional $ 50.0 million in September 2023 and an additional $ 50.0 million in March 2025. During the fiscal year ended January 31, 2026, 9,417,849 shares were purchased for a total cost of $ 67.0 million, excluding broker commissions. As of January 31, 2026, a total of 28,930,297 shares have been purchased for a total cost of $ 185.1 million since the commencement of the program, excluding broker commissions, and approximately $ 14.9 million remained available for future purchases. As part of the share repurchase program, shares may be purchased in open market transactions or pursuant to any trading plan that may be adopted in accordance with Rule 10b5-1 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The timing, manner, price and amount of any repurchases will be determined at the Company’s discretion, and the share repurchase program may be suspended, terminated or modified at any time for any reason. The repurchase program does not obligate the Company to acquire any specific number of shares, and all open market repurchases will be made in accordance with Exchange Act Rule 10b-18, which sets certain restrictions on the method, timing, price and volume of open market stock repurchases. Tender Offer On February 10, 2026, the Company announced the commencement of an issuer self-tender offer (the "Tender Offer") to purchase for cash up to $ 180.0 million in value of shares of common stock of the Company at price of not less than $ 5.75 nor greater than $ 6.50 per share, to the seller in cash, less any applicable withholdings and without interest, upon the terms and subject to the conditions described in the offer to purchase and the related letter of transmittal filed with the SEC on February 10, 2026, as each may be amended time to time. The Tender Offer was originally scheduled to expire on March 12, 2026. On March 4, 2026, the Company decreased the maximum aggregate purchase price of shares to be repurchased in the Tender Offer to $ 140.0 million and extended the expiration date to March 18, 2026, unless further extended or earlier terminated. See Note 18 "Subsequent Events" for additional information. 88 12. Debt Silicon Valley Bank On March 11, 2020, the Company entered into a credit agreement (the “Credit Agreement”) with Silicon Valley Bank (“SVB”). In January 2021, the Company amended the Credit Agreement which modified the conditions pursuant to which subsidiaries are required to become guarantors. On December 22, 2022, the Company entered into a second amendment (“Amendment No. 2”) to the Credit Agreement, dated March 11, 2020, and on July 26, 2024, the Company entered into a third amendment ("Amendment No. 3") to the Credit Agreement, collectively referred to as the Credit Facility. No significant debt issuance costs were incurred in association with Amendment No.2 and Amendment No.3. Amendment No. 2 amended the Credit Facility to, among other things (i) extend the maturity date of the Credit Facility to December 22, 2025, (ii) amend the interest rate provisions to replace LIBOR with SOFR as the interest rate benchmark, and (iii) amend the recurring revenue growth rate financial covenant. Amendment No. 3 amended the Credit Facility to, among other things (i) amend the interest rate applicable to loans under the Credit Facility, and (ii) replace the consolidated quick ratio and recurring revenue growth rate financial covenants with consolidated total leverage ratio and minimum liquidity financial covenants. The Credit Facility provides for a senior secured revolving loan facility of up to $ 50.0 million that matures on December 22, 2025, with the right subject to certain conditions to add an incremental revolving loan facility of up to $ 50.0 million in the aggregate. The revolving loan facility provides for borrowings up to the amount of the facility with sub-limits of up to (i) $ 30.0 million to be available for the issuance of letters of credit and (ii) $ 10.0 million to be available for swingline loans. On May 15, 2025, in connection with the May 2025 Credit Agreement entered into with BlackRock, the Credit Facility with SVB was terminated and was accounted for as a debt extinguishment. No amounts were drawn under the facility at the time of termination, and all remaining unamortized issuance costs were written off, which were immaterial. BlackRock On May 15, 2025, the Company entered into the May 2025 Credit Agreement which provides for (i) a senior secured initial term loan facility (the “Initial Term Loan Facility”) in an aggregate principal amount of up to $ 100.0 million, (ii) a secured delayed draw term loan facility in an aggregate principal amount of up to $ 50.0 million (the “Delayed Draw Term Loan Facility”), and (iii) an uncommitted secured discretionary delayed draw term loan facility in an aggregate principal amount of up to $ 50.0 million (the “Discretionary Delayed Draw Term Loan Facility”, and together with the Initial Term Loan Facility and the Delayed Draw Term Loan Facility, the “Term Loan Facilities” and borrowings under the Term Loan Facilities, the "Term Loans"). The Term Loan Facilities mature on May 15, 2030. The Company borrowed $ 100.0 million under the Initial Term Loan Facility on May 15, 2025 and borrowed $ 50.0 million under the Delayed Draw Term Loan Facility on March 6, 2026. The proceeds of the term loans made under the Initial Term Loan Facility were used to repay existing debt and related fees and expenses associated with Term Loan Facilities, with the remainder available for general corporate purposes, and the Company intends to use the proceeds of the term loans made under the Delayed Draw Term Loan Facility in connection with the Tender Offer. See Note 18 "Subsequent Events" for additional information. The Term Loan Facilities are held by a related party who was an equity holder of the Company on the Closing Date and as of January 31, 2026. The Company includes shareholders holding more than 5% of the voting securities within its definition of related parties. The Term Loan Facilities bear interest, at the Company's option, at an annual rate based on an adjusted term SOFR rate or a base rate. Term Loans based on the adjusted term SOFR rate shall bear interest at a per annum rate equal to term SOFR (subject to a 1.00 % floor) plus 5.25 %. Term Loans based on the base rate shall bear interest at a per annum rate equal to the greatest of (i) the prime rate then in effect, (ii) the federal funds effective rate then in effect, plus 0.50 % per annum, (iii) an adjusted term SOFR rate determined on the basis of a one-month interest period, plus 1.00 % per annum, and (iv) 2.00 %, in each case, plus a margin of 4.25 %. Interest is due and payable quarterly in arrears, in the case of Term Loans bearing interest at the base rate, and at the end of an interest period (or quarterly, in the case of any interest period longer than 3 months), in the case of Term Loans bearing interest at the adjusted term SOFR rate. As of January 31, 2026, interest on the Term Loan Facilities was based on an adjusted term SOFR rate. The obligations under the May 2025 Credit Agreement are guaranteed by certain of the Company's subsidiaries and secured by a lien on substantially all of the Company's property and certain subsidiary guarantors. The May 2025 Credit Agreement contains customary affirmative and negative covenants and restrictions that, among other things, restrict the Company and the Company's subsidiaries' ability to repurchase stock, incur additional debt, pay dividends and make distributions, make certain investments and acquisitions, and prepay certain indebtedness, create liens, enter into agreements with affiliates, modify the nature of its business, enter into sale-leaseback transactions, transfer and sell material assets and merge or consolidate. The May 2025 Credit Agreement also contains financial covenants that require the Company to maintain minimum qualified cash of at least $ 35.0 million at all times and minimum consolidated EBITDA for relevant test periods, tested on a quarterly basis. The May 2025 Credit Agreement contains customary events of default relating to, among other things, payment defaults, breach of covenants, cross acceleration to material indebtedness, bankruptcy-related defaults, judgment defaults, and the occurrence of certain change of control events. Non-compliance with one or more of the covenants and restrictions or the occurrence of an event of default 89 could result in the full or partial principal balance of the May 2025 Credit Agreement becoming immediately due and payable and termination of the commitments. The Term Loans are subject to certain mandatory prepayment events, including an excess cash flow sweep of up to 30 % for excess cash flow periods in which annualized recurring revenue is less than $ 350.0 million. In connection with the May 2025 Credit Agreement, the Company incurred original issue discount costs of $ 1.0 million and debt issuance costs of $ 0.8 million. These costs will be amortized to interest expense over the term of the Term Loan Facilities using the effective interest method. As of January 31, 2026, the Company was in compliance with all debt covenants. The following table sets forth the Company’s debt obligations for the period presented: (in thousands) January 31, 2026 Principal $ 100,000 Unamortized original issue discount and debt issuance costs ( 2,041 ) Net carrying amount $ 97,959 As of January 31, 2026, the fair value of the Term Loan approximates its carrying value and is classified as Level 2 in the fair value hierarchy. See Note 6 "Fair Value of Financial Instruments" for further discussion on the fair value hierarchy. 13. Income Taxes The domestic and international components of the Company's income (loss) from operations before income taxes are as follows: Fiscal year ended January 31, (in thousands) 2026 2025 2024 Domestic $ 33,480 $ ( 33,349 ) $ ( 4,444 ) International 6,646 5,291 4,106 Income (loss) from operations before income taxes $ 40,126 $ ( 28,058 ) $ ( 338 ) The Company's (provision for) benefit from income taxes is comprised of the following: Fiscal year ended January 31, (in thousands) 2026 2025 2024 Current: Federal $ ( 180 ) $ ( 63 ) $ ( 43 ) State ( 415 ) ( 1,359 ) ( 912 ) International ( 1,766 ) ( 1,893 ) ( 1,262 ) Total current ( 2,361 ) ( 3,315 ) ( 2,217 ) Deferred: Federal 112 2,378 ( 4 ) State 6 1,007 ( 11 ) International ( 12 ) 40 ( 60 ) Total deferred 106 3,425 ( 75 ) Total (provision for) benefit from income taxes $ ( 2,255 ) $ 110 $ ( 2,292 ) The Company’s current tax provision for the fiscal years ended January 31, 2026 and 2025, is primarily attributable to profitable jurisdictions outside of the United States (U.S.) and U.S. state income taxes due to limitations imposed on state operating loss ("NOLs") carryforwards and state margin tax. During the fiscal year ended January 31, 2025, the Company recorded a deferred tax benefit of $ 3.4 million from a partial release of the valuation allowance in connection with the Hearsay acquisition. The net deferred tax liability from the acquisition provided a source of additional income to support the realizability of the Company's pre-existing deferred tax assets and as a result, the Company released a portion of its valuation allowance. 90 The Company has elected to prospectively adopt the guidance in ASU 2023-09 Income taxes (Topic 740): Improvements to Income Taxes Disclosures. The following table is a reconciliation of the U.S. federal statutory rate of 21% to the Company's effective tax rate for the year ended January 31, 2026 in accordance of the guidance in ASU 2023-09: Fiscal year ended January 31, 2026 (in thousands) Dollars Percent U.S. Federal Statutory Tax Rate $ 8,426 21.00 % State and local income tax, net of federal income tax effect (1) 408 1.02 % Foreign tax effects: Switzerland Adjustments to deferred tax assets (NOL expiration) 707 1.76 % FX adjustment ( 603 ) ( 1.50 %) Other ( 118 ) ( 0.29 %) Other foreign jurisdictions 396 0.99 % Effect of cross-border tax laws: Global intangible low-taxed income 1,062 2.65 % Other 191 0.47 % Tax Credits: R&D credit ( 2,532 ) ( 6.31 %) Changes in valuation allowances ( 2,479 ) ( 6.18 %) Nontaxable or nondeductible items: Stock-based compensation 1,814 4.52 % Executive compensation 2,461 6.13 % Contingent consideration ( 6,336 ) ( 15.79 %) Other 1,469 3.66 % Changes in unrecognized tax benefits ( 28 ) ( 0.07 %) Other 223 0.55 % Excess tax benefits ( 2,806 ) ( 6.99 %) Total tax provision $ 2,255 5.62 % (1) State taxes in California, Pennsylvania, Texas, and Virginia made up the majority (greater than 50 percent) of the tax effect in this category. 91 The following table is a reconciliation of the U.S. federal statutory rate of 21 % to the Company's effective tax rate for the year ended January 31, 2025 and 2024 in accordance with the guidance prior to the adoption of ASU 2023-09: Fiscal year ended January 31, (in thousands) 2025 2024 U.S. federal tax benefit at statutory rate $ 5,892 $ 71 State taxes, net of federal benefit 2,711 ( 1,286 ) Foreign tax rate differential ( 317 ) ( 191 ) Non-deductible expenses ( 2,209 ) ( 1,902 ) R&D credit carryforward 3,725 15,656 Changes in valuation allowance ( 2,133 ) ( 13,913 ) Rate change ( 1 ) 386 Stock-based compensation ( 758 ) ( 1,593 ) Net excess tax (shortfalls) benefits from stock-based compensation ( 1,334 ) 213 Return to provision adjustment ( 56 ) ( 25 ) Global intangible low-taxed income ( 1,191 ) — Acquisition-related costs ( 3,532 ) — Other, net ( 687 ) 292 Total benefit from (provision for) income taxes $ 110 $ ( 2,292 ) The following table represents income taxes paid (net of refund received) for the year ended January 31, 2026 in accordance with the guidance in ASU 2023-09: (in thousands) Fiscal Year Ended January 31, 2026 Federal $ — State 873 Foreign 2,696 Total income taxes paid $ 3,569 Income taxes paid in individual jurisdictions exceeding 5% of total income taxes paid for the year ended January 31, 2026 is as follows: (in thousands) Fiscal Year Ended January 31, 2026 United Kingdom $ 763 France 409 Mexico 348 California 334 India 391 Germany 238 Hungary $ 230 92 Deferred Income Taxes Deferred income taxes reflect the net tax effects of (a) temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes, and (b) operating loss and tax credit carryforwards. The components of the Company's deferred income taxes were as follows: As of January 31, (in thousands) 2026 2025 Deferred tax assets: Net operating loss carryforwards $ 109,034 $ 97,463 Tax credit carryforwards 25,007 22,577 Stock-based compensation 4,484 5,905 Allowance for doubtful accounts 598 524 Operating lease liability 19,134 23,392 Accrued expenses 3,736 6,420 Unearned revenue 81 65 Property and equipment 1,373 199 Capitalized research & experimental expenditures 32,678 51,062 Other 2,325 1,451 Total deferred tax assets 198,450 209,058 Less: valuation allowance ( 168,940 ) ( 171,650 ) Deferred tax assets, net of valuation allowance 29,510 37,408 Deferred tax liabilities: Costs to obtain revenue contracts ( 5,820 ) ( 5,916 ) Operating lease right-of-use assets ( 12,001 ) ( 16,638 ) Intangible assets ( 11,413 ) ( 14,427 ) Other ( 438 ) ( 533 ) Total deferred tax liabilities ( 29,672 ) ( 37,514 ) Net deferred tax liabilities $ ( 162 ) $ ( 106 ) As of January 31, 2026, for federal income tax purposes, the Company had $ 370.3 million of gross U.S. federal NOL carryforwards, with pre-2018 NOLs expiring starting in fiscal 2036 with others indefinitely carried forward. As of January 31, 2026, for state income tax purposes, the Company had $ 22.9 million of post-apportioned, tax-effected NOL carryforwards, which expire in fiscal 2027 through fiscal 2046. As of January 31, 2026, the Company had $ 7.5 million of tax-effected foreign NOL carryforwards which expire starting in fiscal 2027. As of January 31, 2026, for federal income tax purposes, the Company had $ 32.0 million of gross U.S. federal research and development tax credits carryforwards which expire starting in fiscal 2037, and $ 0.3 million of gross state research and development credits which expires starting in fiscal 2034. Utilization of the Company’s NOLs and tax credit carryforwards in the future will be dependent upon its ability to generate taxable income and could be limited due to ownership changes, as defined under the provisions of Section 382 of the Code and similar state provisions. Utilization of the Company’s foreign NOL carryforwards in the future will be dependent upon local tax laws and regulations. The Company regularly evaluates the realizability of its deferred tax assets and establishes a valuation allowance if it is more likely than not that some or all the deferred tax assets will not be realized. In making such a determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, loss carryback, and tax-planning strategies. Generally, more weight is given to objectively verifiable evidence, such as the cumulative loss in recent years, as a significant piece of negative evidence to overcome. During the fiscal year ended January 31, 2026, the valuation allowance had a net decrease of $ 2.7 million from approximately $ 171.6 million to $ 168.9 million, primarily due to decreases in U.S. deferred tax assets resulting from capitalization and amortization of research and development expenses, netted with the generation of U.S. research and development tax credits and NOLs in the current period. During the fiscal year ended January 31, 2025, the valuation allowance increased $ 2.1 million from approximately $ 169.5 million to $ 171.6 million, primarily due to increases in U.S. deferred tax assets resulting from capitalization and amortization of research and development expenses, and generation of U.S. research and development tax credits, then netted with the net deferred tax liability from the Hearsay acquisition 93 and impact of NOLs utilized. The Company will continue to assess the realizability of the deferred tax assets in each applicable jurisdiction going forward. Other Considerations The Company generally does not provide deferred income taxes for the undistributed earnings of its foreign subsidiaries where the Company intends to reinvest such earnings indefinitely. The Company maintains a mix of assertions across the various jurisdictions where foreign subsidiaries are located. During the current year, the Company changed its assertion with respect to certain subsidiaries' undistributed earnings; however, any incremental U.S. income taxes or local withholding taxes are not material. A reconciliation of the beginning and ending balance of total unrecognized tax benefits for the fiscal years ended January 31, 2026, 2025, and 2024 is as follows: Fiscal year ended January 31, (in thousands) 2026 2025 2024 Beginning of period $ 6,531 $ 4,920 $ — Tax positions taken in prior period Gross increases — 942 4,404 Gross decreases ( 27 ) — — Tax positions taken in current period Gross increases 670 669 516 Currency translation effect — — — End of period $ 7,174 $ 6,531 $ 4,920 The Company did not recognize interest and penalties in fiscal years ended January 31, 2026 and 2025, and 2024. As of January 31, 2026 and 2025, none of the accrued unrecognized tax benefits, if recognized, would reduce the provision for or increase the benefit from income taxes, respectively, or the Company's effective tax rate. The Company is subject to income tax examinations in the United States and various state and foreign jurisdictions. The Company’s most significant operations are in the United States and the earliest open tax year subject to potential examination in the United States is 2008. 14. Leases The Company's operating lease arrangements are principally for office space. As of January 31, 2026, the Company had $ 18.6 million of operating lease liabilities, current, $ 61.9 million of operating lease liabilities, non-current, $ 50.9 million of operating lease right-of-use assets, and no financing leases, on its consolidated balance sheet. The operating lease arrangements included in the measurement of lease liabilities had a weighted-average remaining lease term of 4.9 years and a weighted-average discount rate of 6.0 %, as of January 31, 2026. During the fiscal year ended January 31, 2026, the Company paid $ 19.6 million for amounts included in the measurement of lease liabilities and obtained $ 0.7 million of operating lease right-of-use assets in exchange for lease obligations. The following table summarizes the Company's lease expense for the periods presented: Fiscal year ended January 31, (in thousands) 2026 2025 2024 Operating lease expense $ 14,736 $ 14,894 $ 15,637 Short-term lease expense 115 748 709 Variable lease expense 10,167 9,696 10,082 Total lease expense $ 25,018 $ 25,338 $ 26,428 Operating lease expense is recognized on a straight-line basis over the term of the arrangement beginning on the lease commencement date for lease arrangements that have an initial term greater than twelve months and therefore are recorded on the balance sheet. Upon impairment of an operating lease, lease expense is recognized based on accretion of the lease liability and amortization of the right of use asset which is recorded on a straight-line basis through the end of remaining the lease term. Short-term lease expense is recognized on a straight-line basis over the lease term for lease arrangements that have an initial term of 12 months or less and therefore are not recorded on the balance sheet. Variable lease expense is recognized as incurred and includes real estate taxes and utilities, among other office space related expenses. 94 The total remaining operating lease payments included in the measurement of lease liabilities on the Company's consolidated balance sheet as of January 31, 2026, was as follows (in thousands): Fiscal year ending January 31: Operating Lease Payments 2027 $ 19,207 2028 18,979 2029 18,823 2030 17,324 2031 17,200 2032 and thereafter 1,980 Total operating lease payments 93,513 Less: imputed interest ( 13,008 ) Total lease liabilities, reflecting the present value of net lease payments $ 80,505 During the fiscal year ended January 31, 2026, the Company subleased a floor related to its corporate headquarters and was in the process of subleasing an additional floor as of January 31, 2026. In connection with these arrangements, the Company recorded a $ 8.6 million impairment loss during the fiscal year ended January 31, 2026, of which $ 6.5 million was attributable to the right-of-use asset and $ 2.1 million to the related leasehold improvements. The following table summarizes the Company’s impairment loss for the periods presented: Fiscal year ended January 31, (in thousands) 2026 2025 2024 Cost of revenue $ 2,528 $ — $ — Sales and marketing 2,272 — — Research and development 2,052 — — General and administrative 1,700 — — Total impairment loss $ 8,552 $ — $ — During the fiscal year ended January 31, 2026, the Company recorded $ 0.6 million of sublease income. As of January 31, 2026, the Company's future cash inflows from subleases are as follows (in thousands): Fiscal year ending January 31: 2027 $ 1,880 2028 2,506 2029 2,506 2030 2,506 2031 2,506 2032 and thereafter 208 Total $ 12,112 95 15. Commitments and Contingencies Contractual Obligations The Company is obligated to make payments under certain non-cancelable contractual obligations in the normal course of business. The Company's contractual obligations primarily relate to its operating lease arrangements for office space. Its other contractual obligations include contracts with its Publisher Network application providers, which generally have a term of one year, although some have a term of several years, and its software vendors, among others. These obligations represent minimum contractual payments, or the Company's best estimate for variable elements based on historical payments. The Company's contractual obligations have various expiry dates between fiscal years 2027 and 2035. As of January 31, 2026, the Company's contractual obligations are as follows (in thousands): Fiscal year ending January 31: Leases Other 2027 $ 19,207 $ 41,685 2028 18,979 19,477 2029 18,823 2,367 2030 17,324 659 2031 17,200 18 2032 and thereafter 1,980 67 Total $ 93,513 $ 64,273 In connection with the acquisition of Hearsay, an earnout arrangement exists where the Company may also be required to pay up to $ 75.0 million to the former holders of Hearsay's outstanding equity interests, subject to the achievement of certain ARR milestones over a two-year period. Payments can be settled in cash or shares at the Company's election and the remaining payments are estimated to occur in fiscal year 2027. As of January 31, 2026, $ 8.6 million was paid related to the first year of the earnout. See Note 4 "Business Combination" for additional information. As of January 31, 2026, an escrow balance pertaining to the Places Scout acquisition of $ 1.5 million was held as partial security for certain indemnification obligations, which was subsequently released in February 2026. Legal Proceedings The Company is and may be involved in various legal proceedings arising in the normal course of business. Although the results of litigation and claims cannot be predicted with certainty, currently, in the opinion of the Company, the likelihood of any material adverse impact on the Company's results of operations, cash flows or the Company's financial position for any such litigation or claims is deemed to be remote. Regardless of the outcome, litigation can have an adverse impact on the Company because of defense costs, diversion of management resources and other factors. Warranties and Indemnifications The Company's platform is in some cases warranted to perform in a manner consistent with general industry standards that are reasonably applicable and materially in accordance with the Company's product specifications. The Company's arrangements generally include certain provisions for indemnifying customers against liabilities if its products or services infringe a third-party's intellectual property rights and/or if the Company breaches its contractual agreements with a customer or in instances of negligence, fraud or willful misconduct by the Company. To date, the Company has not incurred any material costs as a result of such obligations and has not accrued any significant liabilities related to such obligations in the accompanying consolidated financial statements. The Company has also agreed to indemnify certain of its directors and executive officers for costs associated with any fees, expenses, judgments, fines and settlement amounts incurred by any of these persons in any action or proceeding to which any of those persons is, or is threatened to be, made a party by reason of the person's service as a director or officer, including any action by the Company, arising out of that person's services as the Company's director or officer or that person's services provided to any other company or enterprise at the Company's request. The Company maintains director and officer insurance coverage that would generally enable the Company to recover a portion of future amounts paid. The Company may also be subject to indemnification obligations by law with respect to the actions of its employees under certain circumstances and in certain jurisdictions. 96 16. Net Income (Loss) Per Share Attributable to Common Stockholders The Company computes basic net income (loss) per share using the weighted average number of common shares outstanding. The Company computes diluted net income (loss) per share using the weighted average number of common shares outstanding plus the effect of potentially dilutive shares using the treasury stock method or the if-converted method depending on the arrangement. The following table sets forth the computation of basic and diluted net income (loss) per share attributable to common stockholders: Fiscal year ended January 31, (in thousands, except share and per share data) 2026 2025 2024 Basic net income (loss) per share: Numerator: Net income (loss) attributable to common stockholders $ 37,871 $ ( 27,948 ) $ ( 2,630 ) Denominator: Weighted-average common shares outstanding, basic 123,563,958 126,850,809 124,056,949 Net income (loss) per share attributable to common stockholders, basic $ 0.31 $ ( 0.22 ) $ ( 0.02 ) Diluted net income (loss) per share: Numerator: Net income (loss) $ 37,871 $ ( 27,948 ) $ ( 2,630 ) Fair value adjustment related to contingent consideration ( 28,600 ) — — Net income (loss), diluted $ 9,271 $ ( 27,948 ) $ ( 2,630 ) Denominator: Number of shares used in basic calculation 123,563,958 126,850,809 124,056,949 Dilutive effect of employee stock-based awards 4,462,689 — — Dilutive effect of incentive pool 666,445 — — Dilutive effect of earnout arrangement 1,219,790 — — Weighted-average common shares outstanding, diluted 129,912,882 126,850,809 124,056,949 Net income (loss) per share attributable to common stockholders, diluted $ 0.07 $ ( 0.22 ) $ ( 0.02 ) Since the Company was in a net loss position for the fiscal years ended January 31, 2025 and 2024, net loss per share attributable to common stockholders was the same on a basic and diluted basis in those periods, as the inclusion of all potential common equivalent shares outstanding would have been anti-dilutive. Anti-dilutive common equivalent shares were as follows: As of January 31, 2026 2025 2024 Options to purchase common stock 317,348 1,566,134 2,021,494 Restricted stock and restricted stock units 1,619,400 10,315,199 9,790,748 Shares estimated to be purchased under ESPP — 366,055 487,529 Performance-based restricted stock units 2,431,250 3,495,000 3,555,000 Total anti-dilutive common equivalent shares 4,367,998 15,742,388 15,854,771 The earnout arrangement and incentive pool entered into in connection with the acquisition of Hearsay represent liability-classified arrangements that may be settled in cash or shares at the Company's election. Diluted net income per share includes the effect of the potential share settlement associated with these arrangements when such effects are dilutive, for the period the arrangements were outstanding. See Note 4 "Business Combinations" for additional information related to the earnout and incentive pool. 97 17. Segment Information The Company operates as one operating segment for which the CODM uses consolidated net income (loss) to measure segment profit or loss. This measure of segment profit or loss is used by the CODM to allocate resources and assess performance. See Note 2 "Summary of Significant Accounting Policies" for more information about the Company's segment policy. The following table is a summary of the significant expenses and consolidated net income (loss) provided to the CODM: Fiscal year ended January 31, (in thousands) 2026 2025 2024 Revenue $ 446,579 $ 420,957 $ 404,322 Less: Cost of revenue (1) 98,683 89,364 84,568 Sales and marketing (1) 118,018 149,390 163,763 Research and development (1) 72,811 64,319 60,691 General and administrative (1) 60,515 62,279 56,540 Other segment expenses (2) 58,681 83,553 41,390 Consolidated net income (loss) $ 37,871 $ ( 27,948 ) $ ( 2,630 ) (1) Excludes i) stock-based compensation expense; ii) amortization of acquired intangibles; iii) acquisition-related costs inclusive of transaction and related costs, subsequent fair value movements in contingent consideration, and compensation arrangements; iv) asset impairments; v) strategic transaction costs related to Michael Walrath's non-binding proposal to acquire all outstanding shares of the Company; and vi) payroll tax contingencies related to a one-time state payroll withholding tax audit. The significant expense categories align with the information that is regularly provided to the CODM. (2) Other segment expenses include i) stock-based compensation expense; ii) amortization of acquired intangibles; iii) acquisition-related costs inclusive of transaction and related costs, subsequent fair value movements in contingent consideration, and compensation arrangements; iv) asset impairments; v) strategic transaction costs; and vi) payroll tax contingencies. Other segment expenses also include interest (income) expense, net, (provision for) benefit from income taxes and other expense (income), net. 18. Subsequent Events On February 2, 2026, the Company announced that Michael Walrath, the Company's Chief Executive Officer and Chairman of the Board of Directors, had withdrawn his previously announced non-binding proposal to acquire all outstanding shares of the Company not already owned by him at a price of $ 9.00 per share in cash. Mr. Walrath informed the Board of Directors that he would not be able to obtain the necessary financing at the price set forth in his proposal. On February 10, 2026, the Company announced the commencement of the Tender Offer to purchase for cash up to $ 180.0 million in value of shares of common stock of the Company at price of not less than $ 5.75 nor greater than $ 6.50 per share, to the seller in cash, less any applicable withholdings and without interest, upon the terms and subject to the conditions described in the offer to purchase and the related letter of transmittal filed with the SEC on February 10, 2026, as each may be amended time to time. The Tender Offer was originally scheduled to expire on March 12, 2026. On March 4, 2026, the Company decreased the maximum aggregate purchase price of shares to be repurchased in the Tender Offer to $ 140.0 million and extended the expiration date to March 18, 2026, unless further extended or earlier terminated. On March 6, 2026, the Company borrowed $ 50.0 million under the Delayed Draw Term Loan Facility pursuant to the May 2025 Credit Agreement which the Company intends to use in connection with the Tender Offer. 98 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure None.