QTWO 10-K & 10-Q changes, risk factors and insider trading

•the current economic environment and challenges in the financial services industry, including impacts on our customers' decisions to purchase our products and services and the related demand for our solutions relative to our expectationsexpectations, including economic impacts resulting from changes to U.S. trade policy, tariff and import/export regulations;

•defects,the failuresrecently orcompleted interruptionsmigration inof third-partythe servicescomputing, orstorage solutions,and includingprocessing of our digital banking platform solutions from our third-party data centers andto third-party public cloud service providers;

•the dilutive effects of future sales,sales or anticipation of future sales, of our common stock and the resulting impact on the price of our common stock;

We maintain various types of confidential information, including our own information and that of our customers and their End Users. For example, certain elements of our solutions process and store personally identifiable information, or PII, such as banking and personal information of our customers and their End Users, and we also regularly have access to PII during various stages of the implementation process or during the course of providing customer support. Furthermore, as we develop additional functionality, we may gain greater access to PII. Our solutions and the solutions of our third-party partners are used to process various types of transactions, including debit card, credit card, electronic bill payment, Automated Clearing House, or ACH, payments, real-time payments through faster payment networks, transactions in cryptocurrencies and check clearing that support consumers, financial institutions and other businesses. We maintain policies, procedures and technological safeguards designed to protect the confidentiality, integrity, availability and privacy of confidential information, including PII, our solutions and our information technology systems. However, we are vulnerable to attack and cannot entirely eliminate the risk of improper or unauthorized access to our solutions or information technology systems or disclosure of confidential information or other security and privacy events that impact the integrity, availability or privacy of confidential information, including PII, or our systems, solutions and operations, or the related costs we may incur to mitigate the consequences from such events. Further, given the flexibility and complexity of our solutions, including an increasing number of integrations to third party solutions and increasing reliance on third-party public cloud service providers, there is a risk that configurations of, or defects in, the solutions or errors in their development or implementation could create vulnerabilities to fraud, security and privacy breaches. There have been and will continue to be unlawful attempts to disrupt or gain access to our solutions, information technology systems or the PII or funds of our customers or their End Users, and any successful attempts could disrupt our or our customers' operations and result in financial losses to us and our customers. In addition, because we increasingly leverage third-party providers, including cloud, software, data centersoftware and other critical technology vendors to develop and deliver our solutions to our customers and their End Users, we rely heavily on the data security technology practices and policies adopted by these third-party providers, and we may not be able to identify vulnerabilities in such third-party practices and policies. A vulnerability in a third-party provider's software or systems, a failure of our third-party providers' safeguards, policies, procedures or overall business operations or a breach of a third-party provider's software or systems could result in financial loss and the compromise of the confidentiality, integrity or availability of our systems or the data housed in our solutions.

In addition, third parties may attempt to fraudulently induce our employees or the employees of our customers or third-party providers into disclosing sensitive information such as usernames, passwords or other information to gain access to our confidential or proprietary information or the data of our customers and their End Users. A party who is able to compromise the security of our facilities, whether physical or systematic, could cause interruptions or malfunctions in our operations. We continue to make investments in insider threat programs, but we may be unable to anticipate or prevent techniques used to obtain unauthorized access or sabotage systems because they change frequently and generally are not detected until after an incident has occurred. As we increase our customer base and our brand becomes more widely known and recognized, we may become more of a target for third parties seeking to compromise our security measures or gain unauthorized access to our systems or solutions. In addition, there may be a heightened risk of state-sponsored cyberattacks or cyber fraud during periods of geopolitical uncertainty, as cybercriminals attempt to profit from the disruption, given increased online banking, e-commerce and other online activity. Additionally, there is an increased risk that we may experience cybersecurity-related events, such as phishing attacks, and other security challenges as a result of some of our employees and employees of our service providers working remotely from non-corporate managed networks. Increased risks associated with cyberattacks, data and privacy breaches and breaches of security measures within our solutions, systems and infrastructure or the products, systems and infrastructure of our customers or third parties upon which we rely and the resultant costs and liabilities may cause failure or inability to meet our customers' expectations with respect to security and confidentiality and could harm our business, and seriously damage our reputation and affect our ability to retain customers and attract new business. Our systems and operations are also subject to inherent internal threats from employees or contractors such as unauthorized information access or disclosure and asset misappropriation, including as a result of inadequate access management. While we endeavor to counter these threats through processes designed to identify and monitor potentially risky behaviors, including data loss prevention and access rights management protocols, no risk mitigation strategy can entirely eliminate the risks posed by internal threats.

Although we monitor our solutions and information technology systems to detect and block threats, as cyber threats have evolved and continue to evolve, vulnerabilities in the supplier ecosystem, our solutions and information technology systems have been and may in the future be exploited. We expectcontinue to expend additional resources to continue to modify or enhance our layers of defense to remediate such vulnerabilities.vulnerabilities and adjust lifecycle management. System enhancements and updates create risks associated with implementing new systems and integrating them with existing ones, including risks associated with the effectiveness of our, our customers' and our third-party providers' software development lifecycles. Due to the complexity and interconnectedness of our systems and solutions, the process of enhancing our layers of defense, including addressing hardware-based vulnerabilities, can itself create a risk of systems disruptions and security issues. Our and our customers' and third-party providers' ability and willingness to deliver patches and updates to mitigate vulnerabilities in a timely manner can introduce additional risks, particularly when a vulnerability is being actively exploited by threat actors. Customer utilization of older versions of our solutions can increase the risk and complexity of security vulnerabilities and the resources and time required to address them.

Our operating results may vary based on the impact of changes in our industry, the geopolitical landscape or the global economy on us or our customers and their End Users. Continued widespread geopolitical and global economic conditions such as inflationary pressures, high and shifting interest rates, inflation rates, recession fears or economic slowdown in the United States or internationally, geopolitical uncertainty including acts of war, military conflict, uncertainties or conflicts in and around Ukraine, the Middle East and other parts of the world, regulatory changes, or political or regulatory uncertainty or discord, could adversely affect demand for our solutions and make it difficult to accurately forecast our results and plan our future business activities. While we do not have significant operations in directly affected areas, we are unable to predict the impact of geopolitical factors on the global economy or on our financial condition or results of operations. The revenue growth and potential profitability of our business depend on demand for enterprise SaaS solutions and services generally and for financial services solutions in particular. Weak or deteriorating economic conditions in the financial services industry could adversely affect our current or prospective customers' ability or willingness to purchase our solutions, put pressure on corporate information technology expenditures, delay purchasing decisions, reduce the value or duration of their subscriptions, or affect subscription renewal rates, all of which could adversely limit our ability to grow our business and negatively affect our operating results. Persistent elevated interest rates or any fluctuationsChanges in interest rates may impact account holder demand for loans and the creditworthiness of existing borrowers, resulting in operational challenges for financial institutions, including higher credit losses and difficulty in assessing risk in their existing loan portfolios and in making new lending decisions. Economic uncertainties, whether relating to general economic and geopolitical conditions, a changing or uncertain regulatory environment or challenges in the financial services industry, including specifically related to discretionary spending, have the ability to limit the growth of our business and negatively affect our operating results. Uncertain economic and geopolitical conditions may also adverselydisrupt affectsupply chains, including third parties with which we have entered into relationships and upon which we depend in order to grow our business, such as technology vendors and third-party public cloud service providers.providers, which could lead to payment delays and failures to settle financial transactions. The duration and severity of these unfavorable or uncertain conditions and their long-term effects on us and our customers remain uncertain and difficult to predict, and we may be unable to continue to grow or to grow at a similar rate in the event of future and sustained economic slowdowns.

Recent economic pressures from elevated and fluctuating interest rates, inflationary pressures, instability in the banking and financial services sectors and slowdowns in the economy, financial markets and credit markets have had and could continue to have an impact on account holders or End Users of our solutions, our customers' prospects and our business sales cycles, and our customers' or prospective customers' spending decisions. Downturns in the financial services industry and unfavorable economic conditions affecting the regions in which our customers or prospective customers are concentrated or particular segments of customers or prospective customers on which we focus, including the Alt-FI and FinTech sectors, have and may continue to cause our customers or prospective customers to delay or reduce their spending on solutions such as ours or seek to terminate or renegotiate their contracts with us, including in either case as a result of insolvency or bankruptcy. A significant portion of our revenues is derived from financial institutions, and in particular RCFIs, and we have been and may continue to be impacted by challenges in the economic environment and financial services industry. Some financial institutions have in the past experienced significant pressure due to economic uncertainty, liquidity concerns and increased regulatory scrutiny. In recent years, many financial institutions have merged or been acquired, and periodically during downturns a limited number of financial institutions have failed, creating market disruption and uncertainty within the financial services industry, in particular among RCFIs. The actions taken by such institutions to address potential liquidity concerns have resulted in certain institutions incurring substantial costs that have negatively impacted, and may continue to negatively impact, their profitability and could lead to further market instability or bank failures. Additionally, regulatory changes aimed at stabilizing the financial system could impose new burdens, further straining the profitability of these institutions and potentially leading to a contraction in economic activities. Market conditions, including deteriorating performance of certain loan portfolios, including commercial real estate loan portfolios, capital constraints, and fluctuating levels of direct losses and charge-offs for some financial institutions, have also caused and may continue to cause financial institutions to reduce lending activity as they seek to increase their reserves to maintain better liquidity. Additionally, banking regulators, as well as increasingly cautious investors, have increased scrutiny of commercial real estate lending. This heightened attention may compel financial institutions with substantial commercial real estate loan portfolios to adopt more stringent underwriting standards, enhance internal controls, bolster risk management policies, conduct more rigorous portfolio stress testing, and maintain higher reserve levels. While the U.S. government has taken measures to strengthen public confidence in the banking system and protect depositors, such steps may be insufficient to resolve the volatility in the financial markets and reduce the risk of additional bank failures. It is possible these conditions may persist, deteriorate or reoccur, and longer term, failures and consolidations are likely to continue, and there are very few new financial institutions being created. Further, if our customers merge with or are acquired by other entities that have in-house developed solutions or that are not our customers or use fewer of our solutions, our customers may discontinue, reduce or change the terms of their use of our solutions. It is also possible that the larger financial institutions that result from mergers or consolidationsconsolidations, including large scale core migrations leading to industry consolidation, could have greater leverage in negotiating terms with us or could decide to replace some or all of our solutions. Financial institutions increasingly face competition from non-depository institutions or other innovative products or emerging technologies, such as cryptocurrenciescryptocurrencies, stablecoin or stablecoin,deposit tokenization, which may reduce the number of End Users, or log-ins or transactions using their more traditional financial services. Any of these developments could have an adverse effect on our business, results of operations and financial condition.

Such errors, defects, other performance problems, or disruptions in service to provide bug fixes or upgrades, whether in connection with day-to-day operations or otherwise, can be costly and complicated for us to remedy, cause damage to our customers' businesses and to their End Users and harm our reputation. Additionally, certain of our solutions are hosted by our customers or third-party resellers, resulting in our inability to directly access and monitor the data being processed by and our customers' use of such solutions. When any such solutions being hosted by our customers or third-party resellers encounter errors, defects or other performance problems, it can be difficult and costly to assess the issues properly and apply fixes, including because we must rely on the assistance and records of our customers or third-party resellers, as applicable. If the continuity of operations, integrity of processing, or ability to detect or prevent fraudulent payments were compromised in connection with payments transactions, we could suffer financial as well as reputational loss. In addition, if we have any such errors, defects or other performance problems, our customers could seek to terminate their agreements, elect not to renew their subscriptions, delay or withhold payment or make claims against us. Any of these actions could result in liability, lostloss of business, increased insurance costs, difficulty in collecting our accounts receivable, costly litigation, increased regulatory oversight, fines or penalties, adverse publicity and brand damage. Such errors, defects or other problems could also result in reduced sales or a loss of, or delay in, the market acceptance of our solutions.

We depend on third-party data centers, third-party public cloud service providers and third-party Internet service providers, and any disruption in the operation of these facilities, services or access to the Internet have in the past and could in the future adversely affect our business.

We currently host a significant portion ofoperate our digital banking platform solutions from twoon third-party datapublic centercloud hostinginfrastructure, facilitieswith locatedAmazon inWeb Austin,Services, Texasor AWS, and Carrollton,Microsoft Texas,Azure whichserving are both operated by the same third-party provider, andas our primary cloud providers. Our digital lending and relationship pricing solutions, Helixalong solutionswith andselect andigital increasingbanking portionplatform components, are hosted natively in third-party public cloud environments. We have completed the migration of our digital banking platformplatform, solutionsincluding arethe hostedcore bycomputing, third-partystorage and processing capabilities, from privately operated data centers to public cloud serviceinfrastructure. providers, including Amazon Web Services and Microsoft Azure. As we continue to move more computing, storage, and processing services out of our third-party data centers and facilities and into third-party public cloud hosting environments, ourOur reliance on these providers and their systems willis increase.significant. The owners and operators of these current and future facilities and third-party public cloud service providers do not guarantee that our customers' access to our solutions will be uninterrupted, error-free or secure. We have experienced, and may in the future experience, website disruptions, outages and other performance problems with these third-party data centers and third-party public cloud service providers. These problems may be caused by a variety of factors, including infrastructure changes, hardware failures, human or software errors, viruses, security attacks, fraud, operational disruption, spikes in customer usage and denial of service issues. In some instances, we may not be able to identify the cause or causes of these performance problems within an acceptable period of time. We do not control the operation of these third-party data center facilities and third-party public cloud service providers, and such facilities and services are vulnerable to damage or interruption from human error, intentional bad acts, power loss, hardware failures, telecommunications failures, fires, wars, terrorist attacks, floods, earthquakes, hurricanes, tornadoes, pandemics or similar catastrophic events. They also could be subject to break-ins, computer viruses, sabotage, intentional acts of vandalism and other misconduct. The occurrence of a natural disaster or an act of terrorism, a decision to close the facilities without adequate notice or terminate our hosting arrangement or other unanticipated problems could result in lengthy interruptions in the delivery of our solutions, cause system interruptions, prevent our customers' End Users from accessing their accounts or services online, cause reputational harm and loss of critical data, prevent us from supporting our solutions or cause us to incur additional expense in arranging for new facilities, services and support, and we may be required to pay refunds to our customers based on service level agreement (SLA) provisions in their contracts.

To increase our revenues, we will need to continue to attract new customers and encourage current customers to expand the utilization of our solutions or agree to price increases associated with existing solutions. In addition, for us to maintain or improve our results of operations, it is important that our customers renew their subscriptions with us on similar or more favorable terms to us when their existing subscription term expires. Our revenue growth rates may decline or fluctuate as a result of a number of factors, including customer spending levels, customer dissatisfaction with our solutions, customers failing to meet their End UserEnd-User growth projections, decreases in the number of customers, decreases in usage of our solutions by End Users, changes in the type and size of our customers, pricing changes, competitive conditions, the loss of our customers to other competitors and general economic conditions. We cannot give assurance that our current customers will renew or expand their use of our solutions. If we are unable to attract new customers or retain or attract new business from current customers or partners, our business, financial condition and results of operations may be materially and adversely affected.

We have and may continue to face unexpected implementation challenges related to the complexity of our customers' implementation and integration requirements, particularly implementations for larger customers with more complex requirements in their hardware, software and network infrastructure needs. Our implementation expenses increase when customers have unexpected data, hardware or software technology challenges, or complex or unanticipated business or regulatory requirements. In addition, our customers in some cases may require complex acceptance testing related to the implementation of our solutions. Implementations often involve integration with or conversion of customers off of systems and services of third parties over which we do not have control. We may also faceexperience implementation challengesinefficiencies, if we fail to accurately forecastdelays, or provisionincreased costs associated with the necessaryintroduction timeor and resources, including qualified talent, particularly following periodsexpansion of increasednew salesdelivery successtools, automation, or restructuringsAI-assisted impacting our implementation teams. Implementation delays may require us to delay revenue recognition under the related customer agreement longer than expected. Further, because we do not fully control our customers’ implementation schedules, if our customers do not allocate the internal resources necessary to meet implementation timelines or if there are unanticipated implementation delays or difficulties, our revenue recognition may be delayed. Losses of End Users or any difficulties or longer implementation processes,capabilities, including risks related to theadoption, timingperformance, andtraining, predictabilitychange of sales of our solutions, could cause customers to delaymanagement, or forgointegration futurewith purchasesexisting of our solutions.processes.

If the use of our solutions increases, or if our customers demand more advanced features from our solutions, we will need to devote additional resources to improving our solutions, and we also may need to expand our technical infrastructure and related resources at a more rapid pace than we have in the past. This would involve spending substantial amounts to purchase or lease third-party data center capacity and equipment, subscribe to new or additional third-party cloud service services, upgrade our technology and infrastructure or introduce new or enhanced solutions. It takes a significant amount of time to plan, develop and test changes to our solutions and related infrastructure and resources, and we may not be able to accurately forecast demand or predict the results we will realize from such improvements. There are inherent risks associated with changing, upgrading, improving and expanding our technical infrastructure and related resources. Any failure of our solutions to operate effectively with future infrastructure and technologies could reduce the demand for our solutions, resulting in customer dissatisfaction and harm to our business. Also, any expansion of our infrastructure and related resources would likely require that we appropriately scale our internal business systems and services organization, including implementation and customer support services, to serve our growing customer base. If we are unable to respond to these changes or fully and effectively implement them in a cost-effective and timely manner, our service may become ineffective, we may lose customers, and our operating results may be negatively impacted.

We currently compete with providers of technology and services in the financial services industry, including point system vendors, core processing vendors and systems internally developed by financial services providers. With respect to our digital banking platform, we have several point solution competitors, including Candescent, Alkami Technology, Backbase,CSI, ApitureBackbase and Lumin Digital in the online, consumer and SMB banking space and Finastra and Bottomline Technologies in the commercial banking space. We also compete with core processing vendors that provide systems and services such as Fiserv, Jack Henry and Associates and Fidelity National Information Services, or FIS. With respect to our digital lending and relationship pricing solutions, we compete against several point system competitors, including Abrigo, Baker Hill Solutions, nCino, Finastra, Brilliance Financial Technology, Temenos AG, and core processing vendors, including FIS and Fiserv. With respect to our Helix solution, we primarily compete with Galileo Financial Technologies, Marqeta and Green Dot in the BaaS and embedded finance markets, and we compete with Finxact, a Fiserv company, Nymbus, Mambu and Thought Machine Group in the cloud-core markets. Some of our competitors have significantly more financial, technical, marketing and other resources than we have, may devote greater resources to the promotion, sale and support of their systems than we can, have more extensive customer bases and broader customer relationships than we have and have longer operating histories and greater name recognition than we have. In addition, some of our competitors expend more funds on research and development, which may allow them to introduce new and improved technologies and services more frequently than us.

We currently incorporate AI capabilities into certain of ourselect solutions, and we are making investments and anticipate further utilization of AI in our solutions in the future. As with many emerging technologies, AI presents risks, challenges,challenges and unintended consequences related to its development, adoption and use that could adversely affect our business. AI algorithms and training methodologies may create accuracy issues, unintended biases and other unexpected outcomes. Ineffective or inadequate AI development or deployment practices by us or others could result in incidents that impair the accuracy and acceptance of AI-based solutions or cause harm to individuals or customers, creating perceived or actual technical, legal, compliance, privacy, security and ethical risks, which could subject us to competitive harm, regulatory action, legal liability,liability and brand or reputational harm. These incidents could include explainability risk whereby our potential inability to interpret, articulate,articulate or justify the decision-making processes of AI models, compounded by challenges in achieving replicability of outcomes due to the adaptive nature of AI learning, where identical inputs may not always yield repeatable or consistent outputs, and may lead to concerns about trust, regulatory compliance and accountability. If we enable or offer AI-based solutions that are controversial because of their impact on human rights, privacy, employment,employment or other social, economic,economic or political issues, or which contain errors or bias or infringe upon the rights of third parties, we may experience competitive, brand or reputational harm or legal or regulatory action. Further, incorporating AI into our solutions may increase our risk of litigation and risk of non-compliance, as AI is an emerging technology for which the legal and regulatory landscape is not fully developed. The legal and regulatory landscape for AI is emerging and evolving rapidly, and what they ultimately will become remains uncertain, and our obligation to comply with them could entail significant costs, negatively affect our business or entirely limit our ability to incorporate certain AI capabilities into our solutions.

We also currently utilizeuse AI for certain internal functions and in operating our business and we anticipate expanding our use of AI for these purposes, which presents risks and challenges. While we aim to use AI ethically and attempt to identify and mitigate ethical or legal issues presented by its use, we may be unsuccessful in identifying or resolving issues before they arise. The use of AI to support business operations carries inherent risks related to data privacy and security, such as intended, unintended, or inadvertent transmission of proprietary or sensitive information, where security incidents may become more complicated to discover due to the nature of AI. Additionally, we may experience challenges related to implementing and maintaining AI tools, such as developing and maintaining appropriate datasets for such support and internal controls related to their use.use as well as active management of infrastructure and related costs as AI capabilities increase in the industry. Use of AI for business operations also involves the risk of infringing third-party intellectual property rights. Further, dependence on AI may introduce additional operational vulnerabilities by impacting our relationships with customers, partners,partners and suppliers, by producing inaccurate outcomes based on flaws in the underlying data,data or other unintended results. Our competitors or other third-parties may incorporate AI into their products more quickly or more successfully than us, which could impair our ability to compete effectively.

If we fail to respond to evolving technology, technological requirements or introduce adequate enhancements, new features or solutions, our solutions could become obsolete or less competitive.

If we fail to attract, hire and integrate qualified new employees, motivate and retain existing personnel, or maintain a highly skilled and diverse global workforce, our business and future growth prospects could be harmed. Competition for executive officers, software developers, domain experts in financial services and other highly skilled personnel in our industry is intense. In particular, we compete with many other companies for executive officers, software developers with high levels of experience in designing, developing and managing software, as well as skilled sales and operations professionals and knowledgeable customer support professionals, and we may not be successful in attracting the professionals we need. We have from time-to-time experienced, and we may experience in the future, difficulty in hiring and retaining highly skilled employees with appropriate qualifications. Qualified individuals are usually in high demand, and we may incur incremental costs to attract and retain them. We have hired and continue to hire personnel in countries where technical knowledge and other expertise are offered at lower costs than in the U.S., which increases the efficiency of our global workforce structure and reduces our personnel related expenditures. Nonetheless, as globalization continues, competition for employees in these countries has increased, which may impact our ability to retain these employees and increase our compensation-related expenses. We intend to continue to expand our international operations, which will require significant management attention and resources. We may be unable to scale our infrastructure effectively or as quickly as our competitors in these markets, and our revenue may not increase sufficiently to offset these expected increases in costs, causing our results to suffer.

We have international operations in India, Australia, Canada, the United Kingdom and Mexico. In recent years, we have expanded our international operations in order to maintain an appropriate cost structure, access a broader talent pool and meet our customers' needs, which has included opening offices in new jurisdictions. Our continued expansion efforts may involve expanding into less developed countries, which may be subject to political, social or economic instability and have less developed infrastructure and legal systems. The continued international expansion of our operations requires significant management attention and financial resources and involves significant administrative and compliance costs. Our limited experience in operating our business in certain regions outside the U.S. increases the risk that our expansion efforts into those regions may not be successful. In particular, our business model may not be successful in particular countries or regions outside the U.S. for reasons that we currently are unable to anticipate. In addition, conducting international operations subjects us to risks that we have not generally faced in the U.S. These include, but are not limited to:

We have incurred losses from operations in eachmany periodperiods since our inception in 2005, except for 2010 when we recognized a gain on the sale of a subsidiary.2005. We incurred net losses of $38.5 million, $65.4 million and $109.0$65.4 million for the years ended December 31, 2024, 20232024 and 2022,2023, respectively.respectively, and net income of $52.0 million for the year ended December 31, 2025. As of December 31, 2024,2025, we had an accumulated deficit of $664.2$612.2 million. These losses and accumulated deficitdeficit, and most recent period of income, reflect the substantial investments we have made to develop, sell and market our solutions, acquire customers and hire and retain qualified employees. As we seek to continue to grow our business, including through acquisitions, we expect to incur additional sales, marketing, implementation and other related expenses, including amortization of acquired intangibles. Our ability to achieve or sustain profitability will depend on our obtaining sufficient scale and productivity so that the cost of adding and supporting new customers does not adversely impact our margins. We also expect to continue to make other investments to develop and expand our solutions and our business, including continuing to increase our marketing, services and sales operations and continuing our significant investment in research and development and our technical infrastructure, while also managing our business in response to continued challenging economic conditions, challenges in the financial services industry and any anticipated or resulting economic slowdown. We may continue to incur losses in the future as we continue to focus on adding new customers and solutions, and we cannot predict whether or when we will achieve or sustain profitability. Our efforts to grow our business may be more costly than we expect, and we may not be able to increase our revenues enough to offset our higher operating expenses, thus making it challenging to achieve and maintain profitability. While our revenues have grown in recent periods, such growth may not be sustainable, and our revenues could decline or grow more slowly than we expect. We also may incur additional losses in the future for a number of reasons, including due to litigation and other unforeseen reasons and the risks described in this report. Accordingly, we cannot give assurance that we will achieve profitability in the future, nor that, if we do become profitable, we will be able to sustain profitability. If we are unable to achieve and sustain profitability, our customers may lose confidence in us and slow or cease their purchases of our solutions and we may be unable to attract new customers, which would adversely impact our operating results.

As of December 31, 2024,2025, we had approximately $438.4$458.8 million of U.S. federal net operating loss carryforwards. Utilization of these net operating loss carryforwards depends on many factors, including our future income, which cannot be assured. Section 382 of the Internal Revenue Code, as amended, generally imposes an annual limitation on the amount of net operating loss carryforwards that may be used to offset taxable income when a corporation has undergone an ownership change. An ownership change is generally defined as a greater than 50% change in equity ownership by value over a 3-year period. Future ownership changes or future regulatory changes could further limit our ability to utilize our net operating loss carryforwards. To the extent we are not able to offset our future income against our net operating loss carryforwards, this would adversely affect our operating results and cash flows ifto the extent we attainare able to sustain our profitability.

Financial accounting standards may change or their interpretation may change. A change in accounting standards or practices can have a significant impact on our reported financial results for periods prior and subsequent to such change. Changes to existing rules or the re-examining of current practices may adversely affect our reported financial results or the way we conduct our business. Accounting for revenues from sales of our solutions is particularly complex, is often the subject of intense scrutiny by the SEC and will evolve as the Financial Accounting Standards Board, or FASB, continues to consider applicable accounting standards in this area.

We may require additional capital in the future to pursue business opportunities or acquisitions, pay off our existing debtdebt, repurchase shares of our common stock under our Repurchase Program, or respond to challenges and unforeseen circumstances. We also may decide to engage in equity or debt financings or enter into credit facilities for other reasons. We may not be able to secure additional debt or equity financing in a timely manner, on favorable terms, or at all. Any debt financing we obtain in the future could involve restrictive covenants relating to our capital raising activities and other financial and operational matters, which may make it more difficult for us to obtain additional capital and pursue business opportunities, including potential acquisitions.

Our customers and prospective customers are highly regulated and may be required to comply with stringent regulations in connection with subscribing to, implementing and using our solutions. As a provider of technology to financial institutions, we are examined on a periodic basis by various regulatory agencies and required to review our third-party suppliers and partners. The stringency of our third-party review is based on criticality criteria. The examination handbook and other guidance issued by the Federal Financial Institutions Examination Council, or FFIEC,FFIEC govern the examination of our operations and include a review of our systems and data center and technical infrastructure, management, financial condition, development activities and our support and delivery capabilities. If deficiencies are identified, customers may choose to terminate or reduce their relationships with us. In addition, while much of our operations are not directly subject to the same regulations applicable to financial institutions or our bank partners, we are generally obligated to our customers to provide software solutions and maintain internal systems and processes that comply with federal, state and other regulations applicable to them. In particular, as a result of obligations under our customer agreements, we are required to comply with certain provisions of the Gramm-Leach-Bliley Act related to the privacy of consumer information and may be subject to other privacy and data security laws because of the solutions we provide. In addition, numerous regulations have been proposed and are still being written to implement the Dodd-Frank Act, including requirements for enhanced due diligence of the internal systems and processes of companies like ours by their financial institution customers. In October 2024, the CFPB issued a rule pursuant to sectionSection 1033 of the Dodd-Frank Act that requireswould require banks and other financial institutions to share certain customer account data securely with consumers and authorized third parties upon consumer request by giving them control over their personal financial data while promoting transparency, data portability, and competition in the financial sector. Institutions must comply by set dates based on their size starting in 2026.request. In general, larger financial institutions are subject to more stringent regulations and as a result, as we sell our solutions to larger financial institutions, we will become obligated to meet more stringent regulatory standards, including more in-depth due diligence. Certain of our solutions are designed to be highly configurable by our customers and their ability to perform as intended can be affected by the manner in which our customers use or configure the solutions. To the extent we do not adequately train our customers to properly use such highly configurable solutions and advise them of the associated risks, or to the extent our customers do not follow our training, our customers may use them incorrectly or in a manner that violates the law or causes harm to our customers or their End Users. Regulatory scrutiny of BaaS solutions has recently increased and may require us to devote significant resources to enhancing relevant policies, procedures and operations related to our Helix solutions, and the failure to satisfy such increased scrutiny may cause regulators to take action against us. Furthermore, regulatory scrutiny of BaaS solutions extends directly to middleware providers, which, in certain circumstances, may result in our customers bearing accountability for our compliance and risk management, including with respect to penalties, fines, and other measures that bank regulatory agencies take in the event of non-compliant activity or risks that are not well controlled. InAdditionally, Julyregulatory 2024,agencies have expressed increased interest in the FDIC released a noticeuse of proposedautomated rulemakingand (thedata-driven "NPR")tools toin revisefinancial regulationsservices. Changes in supervisory expectations or enforcement approaches related to brokeredsuch deposits, revising the "deposit broker" definition and proposing to eliminate the "exclusive deposit placement arrangement exception," among other changes. Elimination of the "exclusive deposit placement arrangement exception" as proposed in the NPR would require our customers to reevaluate their current classification of certain BaaS deposits andtools could require ouradditional customerscompliance toinvestments reclassifyor thoseoperational as brokered depositsadjustments and may alsoadversely requireaffect our customersbusiness. In July 2025, the GENIUS Act, which established a framework for regulating stablecoins, was signed into law and may impact our prospects' and customers' operations. Financial services providers and their solutions are subject to reclassify certain BaaS deposits as brokered deposits. As FinTechsextensive and financialcomplex institutionsregulations faceand increasedoversight by federal, state and other regulatory scrutiny,authorities. theirNew scrutinyregulations of our services will likely increase and our inability to satisfactorily respond to partner demands could result in those partners moving to different solutions. If we have to makeor changes to ourexisting internalregulations processesmay create uncertainty or additional cost for financial services providers as they adjust their operations and solutionscompliance efforts. Changes to regulations or new regulations may also encourage the adoption and prevalence of new financial products and services from non-depository institutions, such as acryptocurrencies resultor ofstablecoin, thesewhich regulatorymay changes,compete wewith couldtheir bemore requiredtraditional tofinancial invest substantial time and funds and divert time and resources from other corporate purposes to remedy any identified deficiency.services.

Failure to comply with laws concerningapplicable privacy, data protection andor information security laws and requirements, whether due to our own controls, third-party service providers or evolving regulatory expectations, could result in enforcement actionactions against us, including fines, penalties, remediation obligations, reduced demand for our solutions, imprisonment of company officials and public censure, claims for damages by customers, End Users and other affected individuals, damage to our reputation and loss of goodwill (both in relation to existing customers and End Users and prospective customers and End Users), any of which could havematerially aadversely material adverse effect onaffect our operations,business, results of operations and financial performancecondition. Compliance with breach notifications and business.remediation obligations alone could result in substantial costs. In addition, we could suffer adverse publicity and loss of customer confidence were it known that we did not take adequate measures to assure the confidentiality of the personally identifiable information that our customers had given to us. This could result in a loss of customers and revenue that could jeopardize our success. Moreover, even where we believe we are in compliance, we may nevertheless be subject to claims, investigations or enforcement actions due to evolving legal standards, regulatory interpretations or allegations of inadequate safeguards. We may not be successful in avoiding potential liability or disruption of business resulting from the failure to comply with these laws and, even if we comply with laws, may be subject to liability because of a security incident. If we were required to pay any significant amount of money in satisfaction of claims under these laws, or any similar laws enacted by other jurisdictions, or if we were forced to cease our business operations for any length of time because of our inability to comply fully with any of these laws, our business, operating results and financial condition could be adversely affected. Further, complying with the applicable notice requirements in the event of a security and privacy breach could result in significant costs.

We may become subject, from time to time, to legal proceedings and claims that arise in the ordinary course of business such as claims brought by our customers in connection with commercial or intellectual property disputes, employment claims made by our current or former employees, whistleblower claims or commercial or intellectual property claims by our suppliers or service providers. Litigation might result in substantial costs and may divert management's attention and resources, which might seriously harm our business, our overall financial condition and our operating results. Insurance may not cover such claims, provide sufficient payments to cover all the costs to resolve one or more such claims or continue to be available on terms acceptable to us. A claim brought against us that is uninsured or underinsured could result in unanticipated costs and impact our liquidity, thereby reducing our operating results and impacting our financial condition, leading analysts and investors to reduce their confidence and expectations which may reduce the trading price of our stock.condition.

Our employees may use certain technological tools and infrastructure that allow us to enhance productivity, such as AI-enhanced chat bot functionality, which can generate code or other content. If we cannot develop or maintain effective policies and controls around the use of AI, or if resulting code or content inadvertently contains malicious or vulnerable data or code, open-source code, infringes upon third-party intellectual property rights or is encumbered by third-party rights, our business and reputation could be harmed. Such use of AI may also result in disclosure of Q2our confidential or proprietary information to the third party providing the AI, or others, and potentially further use or copying by such third parties of Q2'sour proprietary information.

As of December 31, 2024,2025, we had nineseven patent applications pending and 1617 patents issued in the U.S. and other countries. We do not know whether our pending patent applications will result in the issuance of patents or whether the examination process will require us to narrow the scope of our claims. To the extent that our pending patent applications or any portion of such applications proceed to issuance as a patent, any such future patent may be opposed, contested, circumvented, designed around by a third party or found to be invalid or unenforceable. In addition, our existing and any future issued patents may be opposed, contested, circumvented, designed around by a third party or found to be invalid or unenforceable. The process of seeking patent protection can be lengthy and expensive. We rely on a combination of patent, copyright, trade secret, trademark and other intellectual property laws to protect our intellectual property, and much of our technology is not covered by any patent or patent application.

We strive to conduct our business in a responsible and sustainable manner, considering environmental, social, and governanceESG factors in our decision-making processes. We are committed to sustainable business practices and strive for positive impacts in not just environmental matters, but also social and governance practices. We disclose our goals, accomplishments, and targets related to these matters on our website and through various public communications. While we are dedicated to these objectives, they are aspirational in nature and not guarantees of future performance or results. In addition, as anti-ESG sentiment has gained momentum in the U.S. in recent years, we may also face scrutiny, reputational risk, lawsuits, market access restrictions or governmental enforcement actions or penalties as a result of our ESG programs and commitments.

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and related notes included elsewhere in this Annual Report on Form 10-K. In addition to historical consolidated financial information, the following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to these differences include those discussed below and elsewhere in this Annual Report on Form 10-K, particularly in the sections titled "Risk Factors" and "Special Note Regarding Forward LookingForward-Looking Statements" above for a discussion of the uncertainties, risks and assumptions associated with these statements. The following discussion and analysis also includes a discussion of certain non-GAAP financial measures. For a description and reconciliation of the non-GAAP measures discussed in this section, see "Non-GAAP Financial Measures."

Significant resources, personnel and expertise are required to effectively deliver and manageDelivering advanced digital solutions in the complex and heavily regulated financial services industry.industry requires significant resources, personnel and expertise. We provide digital solutions that are designed to be highly configurable, scalable and adaptable to the specific needs of our customers. We design and develop our solutions with an open platform approach intended to provide comprehensive integration among our solution offerings and our customers' internal and third-party systems. Our platform architecture supports modular innovation and enables customers and partners to deploy new capabilities efficiently while maintaining operational resilience and compliance. This integrated approach allows our customers to deliver a unified and robust financial experiencesexperience across digital channels. Our solutions provide our customers the flexibility to configure their digital services in a manner that is consistent with each customer's specific offerings, workflows, processes and controls. Our solutions also allow our customers to personalize the digital experiences they deliver to their End Users by extending their individual services and brand requirements across digital channels. Our solutions and our data center and cloud-based hosting infrastructure and resources are designed to comply with the stringent security and technical regulations applicable to financial institutions and financial services providers and to safeguard our customers' data and that of their End Users.

Founded over 2021 years ago, Q2 began by providing digital banking solutions to domestic regional and community financial institutions, or RCFIs. We have rapidly grown since then through a combination of innovation, broad market acceptanceadoption of our solutions, strategic investments and acquisitions. As customer needs and technology architectures have evolved, we have expanded our solution portfolio to address a broader set of mission-critical technology, data and operational requirements across the financial services value chain. Our expanded collection of solutions now spans digital banking, digital lending and relationship pricing, regulatory and compliance, risk and fraud, account switching, data-driven sales enablement, spending insights and portfolio management, and also includes our open platform solutions as well as our core and BaaS offerings. We serve account holders and borrowers across retail, SMBs,SMBs and commercial segments. While we continue to generate a substantial majority of our revenue from our digital banking platform, we are actively leveraging our broader product portfolio and deep domain expertise to expand our market presence. This strategy includes seeking to further penetrate the digital banking market and drive significant growth across our diverse customer base in the broader financial services sector, while opening up new and meaningful expansion opportunities for our business.

The financial services industry is experiencing significant transformation driven by the growing demand within financial institutions to digitize their operations and offerings, as well as the rise of FinTechs and Alt-FIs, which are reshaping End-User expectations for more innovative and engaging digital financial experiences. At the same time, advancements in data analytics, automation, and AI are increasing the importance of modern, fast, flexible technology platforms that can support innovation while meeting stringent regulatory, security and resiliency requirements. These shifts are leading to new roles and interdependencies among financial institutions, FinTechs and Alt-FIs, necessitating new technology, partnerships, and business models. We believe that lasting value creation in financial services will be achieved by those companies that are capable of supporting and embracing these market dynamics. We have developed a comprehensive suite of offerings to accelerate and optimize this transformation for our customers, ranging from digitizing entire banks to facilitating partnerships between financial institutions, FinTechs,FinTechs and Alt-FIs.

We offer our solutions to most of our customers using a software-as-a-service, or SaaS,SaaS model under which our customers pay subscription fees for the use of our solutions. Our digital banking platform customers have numerous End Users, and those End Users can represent one or more account holders registered to use one or more of our solutions on our digital banking platform. We generally price our digital banking platform solutions based on the number of solutions purchased by our customers and the number of Registered Users, as defined in "Key Operating Measures" below, or commercial account holders utilizing our solutions. We generally earn additional revenues from our digital banking platform customers based on the number of End Users on our solutions, the number of transactions that End Users perform on our solutions,solutions and the excess number of users and transactions above what is included in our standard subscription fee. As a result, our revenues from digital banking platform customersrevenues growgenerally increase as our customers buy more solutions from us and increase the number of EndRegistered Users and companies utilizing our solutions and as those retail users and companies increase their number of transactions on our solutions. Our risk and fraud solutions can be sold as part of, or alongside, our digital banking platform, while some solutions may be sold on a standalone basis and are generally monetized through subscription-based arrangements recognized over the term of the applicable customer agreements. The structure and terms of our digital lending and relationship pricing arrangements vary but generally are also sold on a subscription basis through our direct sales organization, and the related revenues are recognized over the terms of the customer agreements. The structure and terms of our Helix arrangements with FinTechs vary but typically involve relatively lower contracted minimum revenues and instead emphasize usage-based revenue, with such revenue recognized as it is incurred. This combination of subscription-based and usage-based revenue models aligns pricing with customer adoption and platform utilization.

We primarily sell our solutions through our direct sales organization. While the financial institutionsinstitution market is well-defined due to the regulatory classificationsclassification of those financial institutions, the markets for FinTechs and Alt-FIsother financial services providers are broader and more difficult to define due to the changing number of providers in each market. Over the long term, we intend to continue to invest in additional sales representatives to identify and address opportunities in the financial institution, FinTech and Alt-FI markets across the U.S. and internationally and to increase our number of sales support and marketing personnel, as well as our investment in marketing initiatives designed to increase awareness of our solutions and generate new customer opportunities.

We have continuously invested in expanding and improving our digital banking platform since we introduced it in 2005. We intend to continue investing organically and to selectively pursue acquisitions of and strategic investments in technologies that will strengthen and expand the features and functionality of our solutions and provide access to new customers and markets. We have also acquired or developed new solutions and additional functionality that serve a broader range of needs of financial institutions as well as the needs of FinTechs and Alt-FIs. Our portfolio of digital solutions includes a comprehensive suite of offerings for retail, SMB and commercial banking, onboarding, regulatory and compliance, risk and fraud, digital lending and relationship pricing, open platform solutions, BaaS, account switching and data-driven sales enablement, spending insights and portfolio management solutions, among others. We believe our portfolio, which reflects years of strategic development and innovation, affords us a distinct competitive advantage across multiple market segments. Additionally, Q2 Innovation Studio, an API-basedAPI and SDK-based open technology platform, allows our financial institution customers and other partners to develop unique extensions of and integrations to our digital banking platform, allowing financial institutions to quickly and easily deploy customized experiences and the latest financial services expected by End Users. We believe our portfolio, which reflects years of strategic development and innovation, affords us a distinct competitive advantage across multiple market segments.

InstalledCustomer CustomersAccounts

We define a Registered User as an individual relatedassociated towith an account holder of a customer with an Installed Customer on ouractive consumer digital banking platformsolution who has registered to use one or more of our digital banking solutions and has current access to use those solutions as of the last day of the reporting period presented. OurGrowth average number ofin Registered Users peris Installeddriven Customerby growsexpansion as ourwithin existing customer relationships, increased adoption of digital banking platformservices customersby addend more Registered Usersusers and asthe addition of new customers. Over time, we add larger financial institutions to our Installed Customer base. We anticipate thatexpect the number of Registered Users willto grow at a faster rate than ourthe number of Installedrelated Customers.Customer WeAccounts addas newcustomers Registeredincrease Userspenetration throughacross boththeir organicuser andbases, inorganicalthough growth frommay existing customers andfluctuate from theperiod additionto of End Users from new Installed Customers.period. Our Installed Customerscustomers had approximately 24.727.3 million, 22.024.7 million and 21.122.0 million Registered Users as of December 31, 2024,2025, 20232024 and 2022,2023, respectively.

We believe Subscription Annual Recurring Revenue, or Subscription ARR, and Total Annual Recurring Revenue, or Total ARR, provide important information about our future revenue potential and our ability to maintain and expand our relationship with existing clients. We calculate Subscription ARR as the annualized value of all recurring subscription revenue recognized in the last month of the reporting period, with the exception of variable revenue in excess of contracted amounts for which we instead take the average monthly run rate of the trailing three months within that reporting period. Our Subscription ARR also includes the contracted minimum subscription amounts associated with all contracts in place at the end of the quarter for which revenue recognition has not yet commenced. Subscription revenues are defined within "Critical Accounting Policies and Significant JudgementsJudgments and Estimates." We calculate Total ARR as the annualized value of all recurring revenue recognized in the last month of the reporting period, with the exception of variable revenue in excess of contracted amounts for which we instead take the average monthly run rate of the trailing three months within that reporting period. Our Total ARR also includes the contracted minimums associated with all contracts in place at the end of the quarter for which revenue recognition has not yet commenced, and revenue generated from Integrated Services, which we previously referred to as Premier Services. Integrated Services revenue is generated from select established customer relationships where we have engaged with the customer for more tailored, premium professional services resulting in a deeper and ongoing level of engagement with them, which we deem to be recurring in nature. Total ARR does not include revenue from professional services or other sources of revenue that are not deemed to be recurring in nature. Subscription and Total ARR are not a forecast of future revenue, which can be impacted by contract start and end dates and renewal rates. Subscription and Total ARR should be viewed independently of revenue and deferred revenue as Subscription and Total ARR are operating metrics and are not intended to be combined with or replace these items. Our use of Subscription and Total ARR has limitations as an analytical tool, and investors should not consider it in isolation. Other companies in our industry may calculate Subscription ARR and Total ARR differently, which reduces their usefulness as comparative measures.

In addition to financial measures prepared in accordance with GAAP, we use certain non-GAAP financial measures to clarify and enhance our understanding, and aid in the period-to-period comparison, of our performance. We believe that these non-GAAP financial measures provide supplemental information that is meaningful when assessing our operating performance because they exclude the impact of certain categories that our management and board of directors do not consider part of core operating results when assessing our operational performance, allocating resources, preparing annual budgets and determining compensation. Accordingly, these non-GAAP financial measures may provide insight to investors into the motivation and decision-making of management in operating the business. Set forth in the tables below are the corresponding GAAP financial measures for each non-GAAP financial measure. Investors are encouraged to review the reconciliation of each of these non-GAAP financial measures to its most comparable GAAP financial measure included below. While we believe that these non-GAAP financial measures provide useful supplemental information, non-GAAP financial measures have limitations and should not be considered in isolation from, or as a substitute for, their most comparable GAAP measures. These non-GAAP financial measures are not prepared in accordance with GAAP, do not reflect a comprehensive system of accounting and may not be comparable to similarly titled measures of other companies due to potential differences in their financing and accounting methods, the book value of their assets, their capital structures, the method by which their assets were acquired and the manner in which they define non-GAAP measures. Items such as the deferred revenue reduction from purchase accounting, stock-based compensation, transaction-related costs, amortization of acquired technology, amortization of acquired intangible assets andassets, lease and other restructuring charges and non-recurring legal settlements can have a material impact on our GAAP financial results. Beginning in the year ended December 31, 2024, because there was no impact of purchase accounting on revenue, our non-GAAP total revenue is now equivalent to our GAAP total revenue.

We define non-GAAP revenue as total revenue excluding the impact of purchase accounting. We monitor these measures to assess our performance because we believe our revenue growth rates would be understated without these adjustments. We believe presenting non-GAAP revenue aids in the comparability between periods and in assessing our overall operating performance. During the twelve months ended December 31, 2025 and 2024, there was no impact of purchase accounting on revenue, and our non-GAAP total revenue is now equivalent to our GAAP total revenue. The following table presents a reconciliation of GAAP revenue to non-GAAP revenue for each of the periods indicated (in thousands):

We provide non-GAAP operating income that excludes such items as deferred revenue reduction from purchase accounting, stock-based compensation, transaction-related costs, amortization of acquired technology, amortization of acquired intangible assets andassets, lease and other restructuring charges.charges and non-recurring legal settlements. There was no deferred revenue reduction from purchase accounting in either of twelve months ended December 31, 2025 or 2024. We believe excluding these items is useful for the following reasons:

We define adjusted EBITDA as net income (loss) before deferred revenue reduction from purchase accounting, stock-based compensation, transaction-related costs, depreciation, amortization, lease and other restructuring charges, non-recurring legal settlements, provision for income taxes, gain on extinguishment of debt and interest and other (income) expense, net. We believe that adjusted EBITDA provides useful information to investors and others in understanding and evaluating our operating results for the following reasons:

Adjusted EBITDA should not be considered as an alternative to net income (loss) or any other measure of financial performance calculated and presented in accordance with GAAP. The use of adjusted EBITDA as an analytical tool has limitations such as:

Because of these and other limitations, investors and others should consider adjusted EBITDA together with our GAAP financial measures including cash flow from operations and net loss.income (loss). The following table presents a reconciliation of net income (loss) to adjusted EBITDA for each of the periods indicated (in thousands):

Revenue-generating activities directly relate to the sale, implementation and support of our solutions within a single operating segment. We derive the majority of our revenues from subscription fees for the use of our solutions hosted in either our third-party data centers or with third-party public cloud service providers,solutions, transactional revenue from bill-pay solutions and remote deposit products, revenues for professional services and implementation services related to our solutions and certain third-party related pass-through fees. We recognize the corresponding revenues over time on a ratable basis over the customer agreement term or as incurred based on the nature of the revenue. A small portion of our revenues are derived from customers which host and manage our solutions on-premises or in third-party data centers under term license and maintenance agreements. For these customers, we recognize software license revenue once the customer obtains control of the license, which generally occurs at the start of each license term, and recognize the remaining arrangement consideration for maintenance revenue over time on a ratable basis over the term of the software license.

Subscription fees are based on the number of solutions purchased by our customers, the number of End Users using the solutions and other usage fees those users generate by using our solutions in excess of the levels included in our standard subscription fee. Subscription fees are billed monthly, quarterly or annually and are recognized monthly over the term of our customer agreements. The initial term of our digital banking platform agreements averages over five years, although it varies by customer. The structure and terms of our digital lending and relationship pricing arrangements vary but generally are also sold on a subscription basis through our direct sales organization, and the related revenues are recognized over the terms of the customer agreements. The structure and terms of our Helix arrangements with FinTechs vary but typically involve relatively lower contracted minimum revenues and instead emphasize usage-based revenue, with such revenue recognized as it is incurred. This combination of subscription-based and usage-based revenue models aligns pricing with customer adoption and platform utilization. We begin recognizing subscription fees when the control of the service transfers to the customer, generally when the solution is implemented and made available to the customer. We recognize revenue for debit card and bill-pay related transaction services when End Users utilize debit card services integrated within our Helix and other payment-service solutions in the month incurred based on actual or estimated transactions. The timing of our implementations varies period-to-period based on our implementation capacity, the number of solutions purchased by our customers, the size and unique needs of our customers and the readiness of our customers to implement our solutions. We typically recognize any related implementation services revenues ratably over the initial customer agreement term beginning on the date we commence recognizing subscription fees. Contract asset balances arise primarily when we provide services in advance of billing for those services. Amounts that have been invoiced are recorded in accounts receivable, and in revenues or deferred revenues, depending on when control of the service transfers to the customer.

Cost of revenues is comprised primarily of salaries and other personnel-related costs, including employee benefits, bonuses and stock-based compensation, for employees providing services to our customers. This includes the costs of our personnel performing implementation, customer support, third-party data centersimplementations and customer training activities.support. Cost of revenues also includes third-party public cloud service providers, the direct costs of bill-pay and other third-party intellectual property included in our solutions, third-party public cloud service providers, the amortization of deferred solution and services costs, amortization of certain software development costs, co-location facility costs and depreciation of our data center assets, debit card related pass-through fees, third-party public cloud service providers, an allocation of general overhead costs, the amortization of acquired technology intangiblesintangibles, referral fees, co-location facility costs and referraldepreciation fees.of our data center assets. We allocate general overhead expenses to all departments based on the number of employees in each department, which we consider to be a fair and representative means of allocation.

We capitalize certain personnel costs directly related to the implementation of our solutions to the extent those costs are recoverable from future revenues. We amortize the costs for ancapitalized implementation costs once revenue recognition commences, and we amortize those implementation costs to cost of revenues over the expected period of customer benefit, which has been determined to be the estimated life of the technology. Other costs not directly recoverable from future revenues are expensed in the period incurred.

Operating expenses primarily consist of sales and marketing, research and development and general and administrative expenses. They also include costs related to our acquisitions and the resulting amortization of acquired intangible assets from those acquisitions. In an effort to reduce certain of our personnel related expenditures and improve the scaling of expenses relative to revenue growth, we have taken measures intended to increase the cost efficiency of our global workforce structure. Over the long term, we intend to continue to hire new employees and make other investments to support our anticipated growth.growth, Asand as a result, we expect our operating expenses to increase in absolute dollars but to decrease as a percentage of revenues over the long term as we grow our business.

Certain research and development costs that are related to our software development, which include salaries and other personnel-related costs, comprised of employee benefits, stock-based compensation and bonuses attributed to programmers, software engineers and quality control teams working on our software solutions, are capitalized and included in intangible assets, net on the consolidated balance sheets. We intend to continue our investments in our software development teams and the associated technology in order to serve our customers and support our growth.

General and administrative expenses consist primarily of salaries and other personnel-related costs, including employee benefits, bonuses and stock-based compensation, of our administrative, finance and accounting, information systems, compliance and security, legal, human resources employees and certainthe membersmajority of our executive team. General and administrative expenses also include consulting and professional fees, travel and other corporate expenses. We expectexpenses to continue to incur incremental expenses associatedcomply with theregulations growthgoverning ofpublic our businesscompanies and compliancefinancial requirements associated with operating as a regulated, public company.institutions.

Transaction-related costs include compensation expenses related to milestone provisions and retention agreements with certain former shareholders and employees of acquired businesses, which are recognized as earned, and various legal and professional service expenses incurred in connection with merger and acquisition and divestiture related matters, which are recognized when incurred.

Total Other Income (Expense),Income, Net

Total other income (expense),income, net, consists primarily of interest income and expense, other non-operating income and expense, loss on disposal of long-lived assets, foreign currency translation adjustment and gain on extinguishment of debt. We earn interest income on our cash, cash equivalents and investments. Interest expense consists primarily of the interest from the amortization of debt issuance costs, coupon interest attributable to our convertible notes, commitment fees and interest associated with our Revolving Credit Agreement, as well as fees and interest associated with the letter of credit issued to our landlord for the security deposit for our corporate headquarters.

As a result of our current net operating loss utilization, ourOur income tax expenses and benefits consist primarily of federal, state, and international current and deferred income tax expense from global operations.

Revenue-generating activities directly relate to the sale, implementation and support of our solutions within a single operating segment. We derive the majority of our revenues from subscription fees for the use of our solutions hosted in either our third-party data centers or with third-party public cloud service providers,solutions, transactional revenue from bill-pay solutions and remote deposit products, revenues for professional services and implementation services related to our solutions and certain third-party related pass-through fees.

We generate a majority of our transactional revenues based on the number of bill-pay transactions that End Users initiate on our digital banking platform. We also generate a portion of our transactional revenuesplatform, from third-party fees related to End Users utilizing remote deposit products and from fees generated when End Users utilize debit cards integrated with our Helix products. We recognize revenue for transaction services in the month incurred based on actual or estimated transactions.

We evaluate whether we are the principal (i.e., report revenues on a gross basis) or agent (i.e., report revenues on a net basis) with respect to the vendor reseller agreements pursuant to which we resell certain third-party solutions along with our solutions. Generally, we report revenues from these types of contracts on a gross basis, meaning the amounts billed to customers are recorded as revenues, and expenses incurred are recorded as cost of revenues. Where we are the principal, we first obtain control of the inputs to the specific good or service and direct their use to create the combined output. Our control is evidenced by our involvement in the integration of the good or service on our platform before it is transferred to our customers and is further supported by us being primarily responsible to our customers and having a level of discretion in establishing pricing. Revenues provided from agreements in which we are an agent are insignificant.not significant but may increase over time as we expand our relationships with additional third-party solutions.

We grant performance-based restricted stock units which provide for shares of common stock to be earned based on our total stockholder return, or TSR, performance relative to the TSR performance of specified stock indexes, or TSR PSUs, and previously referred to as Market Stock Units, or MSUs. We value TSR PSUs and MSUs on grant date using the Monte Carlo simulation model. The determination of fair value is affected by our stock price and a number of assumptions including the expected volatility and the risk-free interest rate. Our expected volatility at the date of grant is based on the historical volatilities of our stock and peer firms' stocks and the Index over the performance period. We assume no dividend yield and recognize compensation expense ratably over the performance period of the award, as applicable. The number of TSR PSUs and MSUs that vest is based on actual TSR relative to the TSR benchmark as set forth in the award agreement. The minimum percentage that can vest is 0%, with a maximum percentage of 200%. TSR PSUs and MSUs will vest over two-year anda three-year performance periods.period. We recognize compensation expense using the graded attribution method on a straight-line basis over the performance period for each award, as applicable.

Impairment of long-livedLong-lived assets such as property and equipment, acquired intangible assets, capitalized software development costs and right of use assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. We evaluate the recoverability of our long-lived assets by comparing the carrying amount of the asset group to the estimated undiscounted future cash flows. If the carrying value is not recoverable, an impairment is recognized to the extent that the carrying value of the asset group exceeds its fair value.

______________________________________________________________________________ (1) Includes deferred revenue reduction from purchase accounting of zero, $0.3 millionzero and $0.6$0.3 million for the years ended December 31, 2024,2025, 20232024 and 2022,2023, respectively.

Revenues increased by $71.8$98.3 million, or 11.5%,14.1%, from $624.6 million for the year ended December 31, 2023 to $696.5 million for the year ended December 31, 2024.2024 to $794.8 million for the year ended December 31, 2025. This increase in revenue was primarily attributable to a $77.7$95.0 million increase in subscription revenue from the sale of additional solutions to new and existing customers and growth in usageexpansions from new andwith existing customers andcustomers, a $3.1$2.1 million increase in transactional revenue from usage of our solutions,solutions partially offset byand a decrease of $8.9$1.2 million increase in services and other revenue from declines in professional and discretionary services and Helix related pass-through revenue.

The following table presents our cost of revenuesrevenue for each of the periods indicated (dollars in thousands):

Cost of revenues increased by $20.0$23.1 million, or 6.2%,6.8%, from $322.0 million for the year ended December 31, 2023 to $342.0 million for the year ended December 31, 2024.2024 to $365.1 million for the year ended December 31, 2025. This increase was primarily attributable to a $9.2 million increase in personnel costs, including an increase in the number of personnel who provide implementation and customer support services and maintain our third-party data centers and other technical infrastructure, an $8.8$13.4 million net increase in co-location facility, hardware and software costs, third-party public cloud service provider costs and depreciationsoftware of our data center assetscosts resulting from the increased infrastructure necessary to support growing customer activity,activity and migration to third-party public cloud service providers, a $6.1$6.7 million increase from the amortization of capitalized software development and capitalized implementation services, a $3.5$2.1 million net increase in personnel costs, a $2.0 million increase in overhead costs and other discretionary expenses and a $1.2 million net increase in third-party costs related to intellectual property included in our solutions and transaction processing costs and a $2.0 million increase in overhead costs and other discretionary expenses,costs, partially offset by a $4.8$1.3 million decrease as a result of higher capitalized implementation costs, a $3.4 million decrease in services, primarily in pass-through feescosts and a $1.4$1.0 million decrease in amortization of acquired customer technology resulting from assets that becamewas fully amortized.amortized during the year.

We intend to continue to invest in personnel,our businessimplementation processand improvement,customer support teams and third-party partners for intellectual property and transactional processing in our solutions and systemstechnology infrastructure to standardize our business processes and drive future efficiency in our implementations, customerserve our customers and support andour thegrowth. We recently completed migration of a significant portion of the computing, storage and processing of our digital banking platform solutions from our third-party data centers to third-party public cloud service providers. As wea continue to make these investments,result, we expect theythird-party willpublic cloud service provider costs and other similar investments over the long term to increase cost of revenues in absolute dollars,dollars as we grow our business, and we expect such expenses to decline as a percentage of revenuerevenue, asbased ouron operationscost continueefficiencies torealized scalein the business, the level and revenuestiming grow.of implementation support activities, timing of capitalized software development costs, debit card related pass-through fees and other related costs.

Sales and marketing expenses decreased by $3.6$0.1 million, or 3.3%,0.1%, from $109.5 million for the year ended December 31, 2023 to $106.0 million for the year ended December 31, 2024.2024 to $105.9 million for the year ended December 31, 2025. This decrease was primarily attributable to a reduction in personnel costscosts, duelargely tofrom measuresstock-based taken to drive operational effectiveness in our go-to-market strategy.compensation.

Sales and marketing expenses as a percentage of total revenues may change in any given period based on factors such as the addition of newly hired sales professionals, the timing of significant marketing events such as our annual in-person client conference, which we typically hold during the second quarter of each year, and the amount of sales commissions expense amortized. Commissions are generally capitalized and then amortized over the expected period of customer benefit. We anticipate that sales and marketing expenses will increase in absolute dollars overin the long-termlong term as we continue to support our revenue growth and increase marketing spend to attract new customers, retain and grow business with existing customers, build brand awareness, and as we continue to hold various experiences for our current and prospective customers, including our annual client conference typically held during the second quarter.customers. While sales and marketing expenses as a percentage of revenue may fluctuate on a near-term basis, we expect such expenses to decline as a percentage of our revenues over the long-termlong term as our revenues grow and we realize cost efficiencies in the business.

Research and development expenses increased by $5.9$11.1 million, or 4.3%,7.7%, from $137.3 million for the year ended December 31, 2023 to $143.2 million for the year ended December 31, 2024.2024 to $154.3 million for the year ended December 31, 2025. This increase was primarily attributable to a $2.4 million increase from lower capitalization of software development costs, a $2.3$5.6 million increase in personnel costs as a result of the growth in our research and development organization to support continued enhancements to our solutions andsolutions, a $1.0$3.1 million increase in travel-related and other discretionary expenses.expenses, a $2.0 million increase from lower capitalization of software development and implementation services costs and a $0.4 million increase due to an impairment loss related to capitalized software development costs from certain software assets that are no longer expected to be recoverable.

We define a Registered User as an individual associated with an account holder of a customer with an active consumer digital banking solution who has registered to use one or more of our digital banking solutions and has current access to use those solutions as of the last day of the reporting period presented. Growth in Registered Users is driven by expansion within existing customer relationships, increased adoption of digital banking services by end users and the addition of new customers. Over time, we expect the number of Registered Users to grow at a faster rate than the number of related Customer Accounts as customers increase penetration across their user bases, although growth may fluctuate from period to period. Our customers had approximately 27.3 million, 24.7 million and 22.0 million Registered Users as of December 31, 2025, 2024 and 2023, respectively. Registered Users as of June 30, 2026 were 27.8 million compared to 26.2 million as of June 30, 2025.

We believe that our ability to retain our customers and expand their use of our products and services over time is an indicator of the stability of our revenue base and the long-term value of our customer relationships. One of the ways we assess our performance in this area is through our net revenue retention rate and subscription net revenue retention rate, orwhich we refer to collectively as our net revenue retention rates. We calculate our net revenue retention rate as the total revenues in a calendar year, excluding any revenues from acquired customers during such year, from customers who were implemented on any of our solutions as of December 31 of the prior year, expressed as a percentage of the total revenues during the prior year from the same group of customers. Similarly, we calculate our subscription net revenue retention rate as total subscription revenues in a calendar year from customers who were implemented on any of our solutions as of December 31 of the prior year, expressed as a percentage of total subscription revenues for the prior year from the same group of customers. Our net revenue retention rates provide insight into the impact on current year revenues of: the number of new customers implemented on any of our solutions during the prior year; the timing of our implementation of those new customers in the prior year; growth in the number of End Users on such solutions and changes in their usage of such solutions; and sales of new products and services to our existing customers during the current year, excluding any products or services resulting from businesses acquired during such year and customer attrition. The most significant drivers of changes in our net revenue retention rates each year have historically been the number of new customers in the prior year and the timing of our implementation of those new customers. The timing of our implementation of new customers in the prior year is significant because we do not start recognizing revenues from new customers until they are implemented. As an example, if implementations are weighted more heavily in the first or second half of the prior year, both our net revenue retention rate and subscription net revenue retention rate will be lower or higher, respectively, in the subsequent year. Our use of net revenue retention rate and subscription net revenue retention rate have limitations as analytical tools, and investors should not consider them in isolation. Other companies in our industry may calculate net revenue retention rates differently, which reduces their usefulness as a comparative measure. Our net revenue retention rate was 113%, 109% and 108% for the years ended December 31, 2025, 2024 and 2023, respectively, and our subscription net revenue retention rate was 115%, 114% and 112% for the years ended December 31, 2025, 2024 and 2023, respectively.

Our Subscription ARR was $780.1 million, $681.9 million and $593.9 million for the years ended December 31, 2025, 2024 and 2023, respectively. Subscription ARR as of MarchJune 31,30, 2026 was $802.3$825.5 million compared to $702.4$716.0 million as of MarchJune 31,30, 2025. Our Total ARR was $921.4 million, $824.2 million and $734.8 million for the years ended December 31, 2025, 2024 and 2023, respectively. Total ARR as of MarchJune 31,30, 2026 was $944.9$970.8 million compared to $846.6$860.6 million as of MarchJune 31,30, 2025.

We define adjusted EBITDA as net income before stock-based compensation, transaction-related costs, depreciation,depreciation and amortization, lease and other restructuring charges, non-recurring legal settlements, provision for income taxes and interest and other income, net. We believe that adjusted EBITDA provides useful information to investors and others in understanding and evaluating our operating results for the following reasons:

Cost of revenues is comprised primarily of salaries and other personnel-related costs, including employee benefits, bonuses and stock-based compensation, for employees providing services to our customers. This includes the costs of our personnel performing implementations and customer support. Cost of revenues also includes third-party public cloud service providers, the direct costs of bill-pay and other third-party intellectual property included in our solutions, amortization of deferred solution and services costs, amortization of certain software development costs, debit card related pass-through fees, an allocation of general overhead costs, including access to AI-powered productivity and development tools for our employees, the amortization of acquired technology intangibles, referral fees, co-location facility costs and depreciation of our data center assets. We allocate general overhead expenses to all departments based on the number of employees in each department, which we consider to be a fair and representative means of allocation.

Operating expenses primarily consist of sales and marketing, research and development and general and administrative expenses. They also include costs related to our acquisitions and the resulting amortization of acquired intangible assets from those acquisitions. Over the long term, we intend to continue to hire new employees and make other investments to support our anticipated growth, including access to AI-powered productivity and development tools for our employees, and as a result, we expect our operating expenses to increase in absolute dollars but to decrease as a percentage of revenues over the long term as we grow our business.

_______________________________________________________________________________ (1) Includes amortization of acquired technology of $4.3 million and $5.5 million for the three months ended MarchJune 31,30, 2026 and 2025, respectively, and $8.7 million and $11.0 million for each of the six months ended June 30, 2026 and 2025, respectively.

______________________________________________________________________________ (1) Includes amortization of acquired technology of 2.0% and 2.9%2.8% for the three months ended MarchJune 31,30, 2026 and 2025, respectively, and 2.0% and 2.9% for the six months ended June 30, 2026 and 2025, respectively.

Comparison of the Three and Six Months Ended MarchJune 31,30, 2026 and 2025

TheDuring the three months ended June 30, 2026, the increase in revenuerevenues was primarily attributable to a $25.6$24.4 million increase in subscription revenue from the sale of additional solutions to new and existing customers and growth in expansions with existing customers and a $2.0$1.2 million increase in services and othertransactional revenue, partially offset by a $0.8$0.9 million decrease in transactionalservices and other revenue.

We have observed improved subscription bookings and associated revenue primarily from our digital banking solutions from both initial bookings with new customers and expansions with existing customers. For the three and six months ended MarchJune 31,30, 2026, our subscription revenue growth was 17%15% and 16%, respectively, as compared to the prior year period, and we expect subscription revenue will continue to increase as a percentage of total revenue.

TheDuring the three months ended June 30, 2026, the decrease in cost of revenues was primarily attributable to a $1.6$1.7 million decrease in depreciation of our data center assets resulting from our migration to third-party public cloud service providers, a $1.3 million decrease as a result of higher capitalized implementation costs,costs and a $1.2 million decrease in amortization of acquired technology that was fully amortized during the prior yearyear, and a $0.4 million net decrease in personnel costs, largely from stock-based compensation, significantlypartially offset by a $1.9$1.3 million increase from the amortization of capitalized software development and capitalized implementation services, a $0.6$1.2 million increase in overhead costs and a $0.5 million net increase in third-party public cloud service provider costs and software costs resulting from the increased infrastructure necessary to support growing customer activity and migrationa to$0.7 third-partymillion publicincrease cloudin serviceallocated providers.overhead costs, which includes AI-related usage costs and facilities costs.

TheDuring the three months ended June 30, 2026, the decrease in sales and marketing was primarily attributable to a $0.4$1.7 million decrease in personnel costs, largely from stock-based compensationcompensation, andpartially offset by a $0.4 million decreaseincrease in otherallocated discretionaryoverhead, expenses.which includes AI-related usage costs and facilities costs and a $0.3 million increase in marketing events.

TheDuring the three months ended June 30, 2026, the increase in research and development was primarily attributable to a $4.4$3.6 million increase in personnel costs as a result of the growth in our research and development organization to support continued enhancements to our solutions, ana $0.8$1.1 million increase in allocated overhead costs, which includes AI-related usage costs and facilities costs and a $0.4$1.0 million increase in software and other discretionary expenses, partially offset by a $1.6$1.5 million decrease from higher capitalization of software development costs.

We intend to continue our investments in our software development teams and the associated technologytechnology, including AI-related usage, in order to serve our customers and support our growth. We anticipate that research and development expenses will increase in absolute dollars in the future as we continue to support and expand our platform and enhance our existing solutions, as we believe existing customers will have an increased focus on maintaining and improving their digital offerings. While research and development expenses as a percentage of revenue may fluctuate on a near-term basis, we expect such expenses to decline as a percentage of our revenues over the long term as our revenues grow and we realize cost efficiencies in the business.

TheDuring decreasethe six months ended June 30, 2026, the increase in general and administrative expenses was primarily attributable to a $1.3 million increase in personnel costs, including stock-based compensation, to support the growth of our business, a $1.2 million increase in professional services, a $0.7 million net increase in other discretionary expenses and a $0.4 million net increase in allocated overhead, which includes AI-related usage costs and facilities costs, partially offset by a $1.8 million non-recurring legal settlement charge in the prior year related to certain litigation, significantly offset by a $1.4 million increase in personnel costs, including stock-based compensation, to support the growth of our business and a $0.3 million net increase in other discretionary expenses.litigation.

Transaction-related costs are related to various legal and professional expenses incurred in connection with mergers, acquisition,acquisitions, divestitures and other corporate transactions.

TheDuring the three months ended June 30, 2026, the net decreaseincrease in lease and other restructuring charges was primarily attributable to a $1.2$0.6 million reductionincrease in severance charges associated with restructuring or eliminating certain positions and a $0.5$0.3 million decreaseincrease related to updated assessments and ongoing expenses of previously vacated facilities.

TheDuring the three months ended June 30, 2026, the decrease in other income, net was primarily attributable to lowera $2.5 million decrease in interest income due to lower cash investible balances resulting from the repayment of convertible notes at maturity in the prior year.year and current period, partially offset by a $0.9 million realized gain on the sale of fixed assets recognized during the current period and a $0.5 million increase for decreased interest expense due to the maturities of our convertible notes.

TheDuring the three months ended June 30, 2026, the increase in provision for income taxes was primarily driven by a $1.2$0.7 million increase in state income taxes, a $0.9 million increase in federal income taxes and a $0.5 million increase in foreign income taxes, offset by a $1.1 million decrease in federal income taxes.

As of MarchJune 31,30, 2026, our principal sources of liquidity were cash, cash equivalents and investments of $378.9$106.4 million. Based upon our current levels of operations, we believe that our cash flow from operations along with our other sources of liquidity, including our ability to access capital markets and available borrowings under our $125.0 million Revolving Credit Agreement, are adequate to meet our cash requirements for the next twelve months, including the repayment of our 2026 Notes upon maturity.months. We also believe that our longer-term working capital, planned capital expenditures, repurchases of common stock under our share repurchase program, or the Repurchase Program, and other general corporate funding requirements will be satisfied through cash flows from operations and, to the extent necessary, from our borrowing facilities.facility. However, if we determine a need for additional short-term or long-term liquidity, there is no assurance that such financing, if pursued, would be adequate or available on terms acceptable to us.

For the threesix months ended MarchJune 31,30, 2026, our net cash and cash equivalents provided by operating activities was $56.3$117.0 million, which consisted of net income of $26.6$56.5 million and non-cash adjustments of $40.7$79.8 million, partially offset by cash outflows from changes in operating assets and liabilities of $11.0$19.3 million. The primary drivers of cash outflows in operating assets and liabilities were a $22.8 million cash outflow resulting from an increase in accounts receivable, primarily due to the timing of annual billings, an $18.9$24.0 million cash outflow resulting from a gross increase in deferred solution costs primarily from annual commission payments in the prior period and deferred implementation costs from both new customers and existing customer expansionsexpansion and a $11.0$19.0 million cash outflow resulting from aan decreaseincrease in accruedaccounts liabilitiesreceivable, primarily drivendue byto ourthe annualtiming bonusand payout.collection of billings. Cash outflows were partially offset by a $45.5$29.2 million cash inflow resulting from an increase in deferred revenue due to the timing of annual billings and deposits received from customers prior to the recognition of revenue from those related payments. Non-cash adjustments primarily consisted of stock-based compensation, depreciation and amortization, amortization of deferred implementation and deferred solution and other costs, amortization of debt issuance costs, deferred income taxescosts and lease restructuring and impairments, partially offset by amortization of premiums and discounts on investments.impairments.

For the threesix months ended MarchJune 31,30, 2025, our net cash and cash equivalents provided by operating activities was $43.5$92.2 million, which consisted of net income of $4.8$16.5 million and non-cash adjustments of $40.4$84.4 million, partially offset by cash outflows from changes in operating assets and liabilities of $1.6$8.8 million. The primary drivers of cash outflows in operating assets and liabilities were a $20.5$18.2 million cash outflow resulting from an increase in accounts receivable, primarily due to the timing of annual billings, a $11.7$16.0 million cash outflow resulting from a net increase in deferred solution costs primarily from annual commission payments and deferred implementation costs and a $8.5$12.8 million cash outflow resulting from a decrease in accounts payable and accrued liabilities primarilydue drivento bytiming ourof payments and payment of annual bonusbonuses payout.during the first quarter. Cash outflows were partially offset by a $36.1$39.7 million cash inflow resulting from an increase in deferred revenue due to the increase in billings for services to be provided in future periods and deposits received from customers in advance of service delivery and a $5.4 million cash inflow resulting from an increase in accounts payable primarily driven by the timing of payments.delivery. Non-cash adjustments primarily consisted of stock-based compensation, depreciation and amortization, amortization of deferred implementation and deferred solution and other costs,costs and amortization of debt issuance costs, deferred income taxes and lease impairments, partially offset by amortizationa ofdecrease premiumsin anddeferred discountsincome on investments.taxes.

For the threesix months ended MarchJune 31,30, 2026, our net cash provided by investing activities was $16.4$36.9 million, consisting of $28.5$58.7 million received from the maturities of investments, partially offset by $6.6$13.5 million for capitalized software development costs and $8.3 million for the purchase of property and equipment and $5.5 million for capitalized software development costs.equipment.

For the threesix months ended MarchJune 31,30, 2025, our net cash used in investing activities was $19.5$41.6 million, consisting of $34.0$66.2 million for purchases of investments, $4.9$10.5 million for capitalized software development costs and $0.8$2.1 million for the purchase of property and equipment, partially offset by $20.2$37.2 million received from the maturities of investments.

For the threesix months ended MarchJune 31,30, 2026, our net cash used in financing activities was $97.2$420.5 million, consisting of $304.0 million for repayment of the 2026 Notes and $120.1 million for share repurchases under the Repurchase Program.Program, partially offset by $3.6 million received from contributions to our ESPP to purchase our common stock.

For the threesix months ended MarchJune 31,30, 2025, our net cash provided by financing activities was $0.5$4.2 million, attributable to cash received from exercises of stock options.options and contributions to our ESPP to purchase our common stock.

Our principal commitments consist of the 2026 Notes, non-cancelable operating leases primarily related to our facilities, minimum purchase commitments for third-party products, stadium sponsorship costs, commitment fees associated with our Revolving Credit Agreement, third-party public cloud service provider fees and other product costs. Our obligations under the 2026 Notes and Revolving Credit agreement are described in Note 9 to our Condensed Consolidated Financial Statements included in this Quarterly Report on Form 10-Q. Information regarding our non-cancellable leases, non-recurring legal settlementsleases and other purchase commitments as of MarchJune 31,30, 2026 can be found in Note 7 and Note 8 to our Condensed Consolidated Financial Statements included in this Quarterly Report on Form 10-Q.