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

To sustain or increase our revenue, we must regularly add new clients and encourage existing clients to maintain or increase the amount of spend through our platform and adopt existing or new offerings that we make available. If competitors introduce lower cost or differentiated offerings that compete with or are perceived to compete with our offerings, our ability to sell our services to new or existing clients could be impaired. We focus on the value of our platform and related offerings. Agencies and advertisers may have an adverse reaction to the related pricing, which could impair our ability to maintain and attract existing and new clients and our share of their advertising budgets. We have spent significant effort in cultivating our relationships with advertising agencies and advertisers, which has resulted in an increase in the budgets allocated to, and the amount of advertising purchased on, our platform. However, it is possible that we may reach a point of saturation at which we cannot continue to grow our revenue from such agencies or advertisers because of internal limits that advertisers may place on the allocation of their advertising budgets to digital media to a particular provider or otherwise. While we generally have master services agreements (“MSAs”) in place with our clients, such agreements allow our clients to choose the amount they spend through our platform and terminate our services with limited notice. We at times supplement our MSAs with joint business plans and other incentive programs designed to increase spend from existing clients; however, such increased spend may not materialize in the amounts we expect or at all. We do not typically have exclusive relationships with our clients and there is limited cost and difficulty to moving their media spend to our competitors. As a result, we have limited visibility to our future advertising revenue streams. We cannot assure you that our clients will continue to use our platform or related offerings to the extent that we expect or at all, or that we will be able to replace, in a timely or effective manner, departing clients with new clients that generate comparable revenue. If a major client representing a significant portion of our business decides to materially reduce its use of our platform or related offerings or to cease their use altogether, it is possible that our revenue or revenue growth rate could be significantly reduced, and our business negatively impacted.

Our clients include advertising agencies, many of which are owned by holding companies, where decision making is decentralized such that purchasing decisions are made, and relationships with advertisers are located, at the agency, local branch or division level. If all of our individual client contractual relationships were aggregated at the holding company level, onetwo holding companycompanies would have each represented more than 10% of our gross billings for 2024.2025.

In most cases, we enter into separate contracts and billing relationships with the individual agencies and account for them as separate clients. However, some holding companies for these agencies may choose to exert control over the individual agencies in the future. Additionally, aA holding company may be acquired by, or consolidate with, another holding company that does not utilize our platform, or a holding company may choose to exert control over its individual agencies in a way that may otherwise reduceresult in an overall spendreduction onin our platform as a result of an acquisition or consolidation.revenue. If so, any consolidation of, or loss of relationships with such holding companies and consequently, of their agencies, local branches or divisions, as clients could significantly harm our business, financial condition and results of operations.

Macroeconomic conditions beyond our control could harm the overall demand for advertising and the economic health of agencies and advertisers, which could adversely affect our business, financial condition and results of operations.

Our business depends on the overall demand for advertising and on the economic health of the agencies and advertisers that benefit fromuse our platform. Market uncertainties or downturns, whether global, local or industry or sector specific, and any associated macroeconomic conditions, such as growing inflation, concerns around a potential recession, changes in interest rates, recessionary fears, changes in foreign currency exchange rates, changes in trade policies and practices, supply chain disruptions, the impact of global instability in many parts of the world and public health crises, may disrupt the operations of our clients and partners and cause agencies and advertisers to decrease or pause their advertising budgets, which could reduce spend though our platform and adversely affect our business, financial condition and results of operations. As we explore new countries to expand our business, economic downturns or unstable market conditions in any of those countries could also result in our investments not yielding the returns we anticipate.

Inventory suppliers control the bidding process, rules and procedures for the inventory they supply. SuchAdditionally, processessuppliers and other third parties in the programmatic supply chain may extract more value than they add. As a result, supply chains in the market for programmatic ad buying may not always work in our favor or for the benefit of our clients and may createhave inefficiencies inand thelack supply chain for advertising inventory.transparency. Although we have in the past and maycontinue in the futureto undertake efforts to address theseimprove supply chain inefficiencies,efficiency and transparency, we may not be successful in such efforts. Given the importance of ensuring access to quality inventory for our advertisers, we launched our OpenPath offering in order to give clients a simplified, direct connection to publishers. We have been investing in this offering and plan to continue to grow the amount of OpenPath inventory and publishers available through our platform, but we cannot guarantee that this or future offerings will prove attractive to our clients or otherwise be successful.

We operate in a highly competitive and rapidly changing industry. We expect competition to persist and intensify in the future, which could harm our ability to increase revenue and maintain profitability. New technologies and methods of buying advertising present a dynamic competitive challenge, as market participants develop and offer new products and services aimed at capturing advertising spend or disrupting the digital marketing landscape, such as analytics, automated media buying and exchanges. Additionally, the impact of AI on our industry is still emerging and uncertain. We have been developing and implementing AI and machine learning models in our platform for nearly a decade and plan to continue such efforts, but there can be no assurance that our implementation of AI initiatives will continue to enhance our platform and related offerings in the manner we expect. We expect our AI initiatives will require increased investment in infrastructure. To the extent we fail to adopt such technologies effectively or as intended, experience delays in integrating these technologies into our operations or our competitors successfully implement improved AI technologies into their products or services, our ability to compete effectively could be harmed and our growth prospects and results of operations could be adversely affected.

OurFurthermore, our current and potential competitors may have significantly more financial, technical, marketing, and other resources than we have, which may allow them to devote greater resources to the development, promotion, sale and support of their products and services. They may also have more extensive advertiser bases and broader publisher relationships than we have, rich first-partyfirst party data sets, and may be better positioned to execute on advertising conducted over certain channels, such as social media, mobile, and video.video and in the case of “walled garden” inventory providers, may exclusively sell their own inventory directly to advertisers, which prevents us from competing with them entirely for such inventory. Some of our competitors may have a longer operating history and greater name recognition. As a result, these competitors may be better able to respond quickly to new technologies, develop superior solutions, develop deeper advertiser relationships or offer services at lower prices. Any of these developments would make it more difficult for us to sell our platform or related offerings and could result in increased pricing pressure, increased development, sales and marketing expense, or the loss of market share.

Our industry is subject to rapid and frequent changes in technology and laws governing our activities, evolving client needs and expectations and the frequent introduction by our competitors of new and enhanced offerings. If new or existing competitors have more attractive offerings, we may lose clients or clients may decrease their use of our platform. New client demands, superior competitive offerings or new industry standards could require us to make unanticipated and costly changes to our platform or business model. We must constantly make investment decisions regarding new and existing offerings and technology to meet client demand and evolving industry and legal standards. We may make bad decisions regarding these investments.investments, and our efforts to introduce new or upgraded platform features or related offerings, including, for example, those related to third-party data marketplace features, may not function as intended or result in the improvements we expect. Furthermore, even if we believe that our investments improve uponor supplement our platform and related offerings, such as updates to our various platform features and user interface, they may nevertheless fail to meet new or existing client expectations or preferences, which could result in decreased client adoption or use of our platform.platform and related offerings.

In addition, as we develop and introduce new offerings,offerings and further develop existing ones, including in both cases those incorporatingthat increasingly incorporate or utilizingutilize artificial intelligenceAI and machine learning andor newthe processing of personal information, including identifiable information, they may raise new, or heighten existing, technological, security, legallegal, commercial and other risks and challenges, which may cause unintended consequences, and they may not function properly or may be misused by our clients. If we fail to adapt to our rapidly changing industry or to evolving client needs or expectations, or we provide new or updated offerings that exacerbate technological, security, legal or other challenges, the reputation of and demand for our platform or related offerings could decrease and our business, financial condition and operations may be adversely affected. In addition to competitive, regulatory and marketplace uncertainties in the ecosystem, we also anticipate that evolution of the use of AI and machine learning in digital advertising may create challenges and further ecosystem uncertainty, which can be difficult to predict.

We face various and evolving cybersecurity risks that threaten the confidentiality, integrity and availability of our systems and the data that we process. Our offerings involve the storage and transmission of significant amounts of datadata, including personal information from users, clients, and inventory and data providers, a large volume of which is hosted by third-party service providers. Our services and the data on our platform, related offerings and in our systems could be exposed to unauthorized access due to activities that breach or undermine security measures, including: negligence or malfeasance by internal or external actors; attempts by outside parties to fraudulently induce employees, clients or vendors to disclose information or data, including personal information; or errors or vulnerabilities in our systems, offerings or processes or in those of our service providers, clients, and vendors.

For example, from time to time, we experience cyberattacks of varying degrees and other attempts to obtain unauthorized access to our systems, including to employee mailboxes. We have dedicated and expect to continue to dedicate resources toward security protections that are designed to shield our systems and data from these activities, including worldwide incident response teams and dedicated resources to incident response processes. However, such measures cannot provide absolute security and could, among other issues, fail to be adequate or accurately assess the incident severity, not proceed quickly enough, or fail to sufficiently remediate an incident. Further, we can expect that the deployment of techniques to circumvent our security measures may occur with more frequency and sophistication and may not be recognized until launched against a target.target, including through the use of AI. Accordingly, we may be unable to anticipate or detect these techniques or to implement adequate preventative measures.

A breach of our security, a flawed design, and/or our failure to respond sufficiently to a security incident could disrupt our services and result in theft, misuse, loss, corruption, or improper use or disclosure of our systems or data. This could result in government investigations, lawsuits (including class actions), enforcement actions and other legal and financial liability, and/or loss of confidence in the availability and security of our offerings, all of which could seriously harm our reputation and brand and impair our ability to attract and retain clients. As some of our newer offerings involve the receipt and processing of identifiable information, the risks associated with data, including risks related to a breach of our systems increases, and we could be subject to contractual breach and indemnification claims from other clients and partners and otherwise suffer damage to our reputation, brand, and business. We could also be required to notify regulators, customersclients or other third parties. Our platform may also receive data in aggregated or pseudonymized form, and if our systems are breached and such data or information is compromised, it could be damaging to our brand, reputation, and business. Cyberattacks could also compromise our own trade secrets and other confidential information and result in such information being disclosed to others and becoming less valuable, which could negatively affect our business. Although we maintain errors or omissions and cyber liability insurance, the costs related to an incident or other security threats or disruptions may not be fully insured or indemnified by other means and insurance and other safeguards might only partially reimburse us for our losses, if at all. We also cannot guarantee that applicable insurance will be available to us in the future on economically reasonable terms or at all.

Privacy and data protection laws to which we and our clients, inventory partners, and third-party data providers are subject may cause us to incur additional or unexpected costs, subject us to litigation, investigations or enforcement actions for alleged compliance failures, result in less demand for our offerings, or cause us to change our platform, related offerings or business model, which may have a material adverse effect on our business.

Information relating to individualsindividuals, households and their devices (commonly called “personal information” or “personal data”) is regulated under a wide variety of local, state, national and international laws and regulations that apply to its collection, use, retention, protection, disclosure, transfer (including transfer across national boundaries) and other processing. We typically collect and store IP addresses and other device identifiers (such as unique cookie identifiers and mobile applicationadvertising identifiers), which are or may be considered personal data or personal information in many jurisdictions or otherwise subject to regulation. In connection with certain of our offerings, including Unified ID 2.0, EUID and OpenPass, we receive information that directly identifies individuals, such as email addresses and phone numbers, both directly from consumers and from our clients or others. We deploy technical and security measures, internal policy controls, and contractual measures designed to limit how such identifying information is used and shared and to help honor consumer choices.shared. Nevertheless, we cannot guarantee any such measures or controls will be effective and handling identifying information increases our exposure under privacy and data protection laws. Some of our offerings, including those that entail some use of directly identifying information, may also increase our exposure to potential claims by plaintiffs’ attorneys, including by attempting to apply various legal theories – such as alleging violations of wiretapping statutes – to certain of our activities.

The global regulatory landscape regarding the privacy and protection of personal information is evolving, and U.S. (state, federal and local) and foreign governments continue to consider and enact additional legislation and rulemaking related to privacy and data protection, often with a particular focus on intermediaries in the online advertising ecosystem, including those that engage in targeted advertising, “sell” or “share” personal data, and act as “data brokers.” WeWhile a significant volume of laws has already been enacted, we expect to see an increase in, or changes to, privacy andadditional data protection legislation and regulation in this area for the foreseeable future. For example, in the United States, the FTC continues to propose updates to existing regulations, including those governing collection of data from children online and related to “commercial surveillance” generally. Further, the FTC uses its enforcement powers under Section 5 of the Federal Trade Commission Act (the “FTC Act”) (which prohibits “unfair” and “deceptive” trade practices) to investigate companies engaging in online tracking. ForIn example,the preceding few years, the FTC has been very active in bringing enforcement actions against companies that handle personal data it views as sensitive for advertising purposes, including location data brokers and companies that process health-related data. These enforcement announcements signal ongoing regulatory scrutiny of advertising practices that involve “sensitive” categories of personal data such as health data and precise location information. The CommissionFTC could continue to build on this trend under its recently granted authority to enforce a relatively new federal law focused on disclosures of certain “sensitive” information by companies operating as data brokers to certain restricted countries or entities “controlled” by such countries.countries, and the Department of Justice could act on authority granted under an executive order restricting similar practices, for which regulations and guidance have recently taken effect. Other companies in the advertising technology space have been subject to government investigation by regulatory bodies; advocacy organizations have also filed complaints with data protection authorities against advertising technology companies, arguing that certain of these companies’ practices do not comply with data privacy laws, or consumer protection laws such as the FTC Act. As noted above, plaintiffs’ attorneys are also increasingly pursuing claims against advertising technology companies related to their data collection, use and disclosure practices, as well as advertisers and publishers that rely on services provided by these companies. For example, in March 2025, suits alleging various privacy tort theories were filed against us in the Northern District of California. For additional information regarding the pending legal proceedings, refer to Note 13—Commitments and Contingencies—Litigation. We cannot avoid the possibility that one of these investigations or enforcement actions will require us to alter our practices. In addition, a potential federal omnibus privacy law remains a possibility. If ultimately passed, such a law would likely substantially impact the online advertising ecosystem.

State lawmakers are also actively addressing consumer data privacy issues. Many states have adopted omnibus consumer privacy laws, a host of which are already enforceable, while others will take effect over the coming years.laws. These state laws define “personal information” broadly enough to include many online identifiers provided by individuals’ devices, applications, and protocols (such as IP addresses, mobile applicationadvertising identifiers and unique cookie identifiers), individuals’ location data, and hashed versions of email addresses and phone numbers. These laws generally require covered businesses to meet numerous data privacy-related obligations and establish data privacy rights for consumers in such states (including rights to opt out of certain processing of their personal data and to request correction, deletion of and access to personal data), imposing special rules on the collection of personal data from minorsminors, precise location data and other personal data deemed “sensitive” under the laws, and creating new notice and consent obligations. Many also impose data minimization requirements, mandating that companies only collect and process data for certain purposes. MostIn a recent enforcement action, the California Attorney General employed these data minimization standards to attack advertising-related disclosures by a publisher of health-related information. Perhaps most significant for the advertising industry, however, these laws require businesses that engage in certain advertising uses of personal data to offer and honor an opt-out of such activities, including, in some states, through browser or device-based preference signals.activities. (Terminology varies slightly among some of the state laws, tying the opt-out requirement to “targeted advertising,” “sales” or “sharing” of personal data.) Because of these obligations, the availability of data within our platform, our related offerings and the advertising ecosystem more broadly may decline, potentially making our platform and related offerings less valuable to our clients.

These laws and their implementing regulations have and will likely also increase compliance costs and obligations on us, our clients, and other companies in the advertising industry. Although we have attempted to mitigate certain risks posed by these laws through contractual, platform and offering changes, we cannot predict with certainty the effect of these laws and their implementing regulations, manysome of which are not yet finalized, on our business, nor the share of consumers who will carry out their opt-out and other rights and how these actions will impact us, our clients, inventory sources, and our industry. Further, enforcement activity under such laws already in effect, particularly in California, reflects an ongoing focus on online advertising activities and signals regulators’ willingness to pursue in-depth investigations and impose substantial penalties on entities allegedly operating in violation of the statute. Thus, we expect that continuing to maintain compliance with states’ varying legal requirements, including monitoring and adjusting to new regulations and interpretations that emerge through enforcement actions, will require significant time, resources, and expense, as will the effort to monitor whether additional changes to our business practices and our backend configuration are needed, all of which may increase operating costs, or limit our ability to operate or expand our business.

In addition to these broad-based consumer privacy laws, lawmakers and regulators continue to focus on activities that involve use of categories of personal data perceived as especially sensitive, such as health data and children’s data. For example, the FTC has recently finalized an update to rules adopted pursuant to the Children Online Privacy Protection Act, modifying some requirements regardingrelating to the use of children’s data for targeted advertising and several states have enacted laws that would substantially impact activities that involve showing targeted advertisements to individuals under 18 years of age through a variety of new restrictions, or in some cases prohibit it altogether. Further, several states have enacted laws, updated existing laws or have introduced bills to impose new privacy obligations related to health-related personal information beyond that governed by federal and state laws governing medical records and similar information, such as HIPAA. For example, Washington’s My Health, My Data Act (“MHMD”) introduced a host of requirements related to a very broadly-defined notion of consumer health data that impacts the advertising industry in part because MHMD is subject to a private right of action (unlike most other state privacy laws), so plaintiffs’ attorneys could explore claims that stretch the bounds of the law’s text. A somewhat similar law enacted in Virginia is also backed by a private right of action. These laws and the heightened scrutiny associated with the enforcement of such laws may, in turn, ultimately lead to increased compliance and defense costs, and more obligations on us, our clients and other companies in the advertising industry.

Laws governing the processing of personal data in Europe (including the U.K. and EEA) also continue to impact us and continue to evolve. For example, the GDPR defines “personal data” broadly and enhances data protection obligations for controllers of such data and for service providers processing the data. It also provides certain rights, such as access and deletion, to the individuals about whom the personal data relates. IAB Europe previously collaborated with the digital advertising industry to create a user-facing framework (the Transparency and Control Framework, or “TCF”) for establishing and managing legal bases under the GDPR and other U.K. and EU privacy lawslaws, including the ePrivacy Directive. Although the TCF is actively in use, its viability as a compliance mechanism remains under review by European authorities and we cannot predict its effectiveness over the long term. Because we are under the supervision of relevant data protection authorities in both the EEA and the U.K., we may be fined under both the EU GDPR and the UK GDPR for the same breach, with penalties up to the greater of €20 million/BP 17.5 million or 4% of total worldwide annual turnover. In addition to fines, breach of the GDPR can also result in regulatory investigations, enforcement notices, reputational harm and civil claims. Continuing to maintain compliance with the requirements of the GDPR, including monitoring and adjusting to rulings and interpretations that affect our approach to compliance, requires significant time, resources and expense, as will the effort to monitor whether additional changes to our business practices and our backend configuration are needed, all of which may increase operating costs, or limit our ability to operate or expand our business.

Data residency and cross-border transfer restrictions also impact our operations. For the transfer of personal data from Europe to the U.S., we rely upon, and are certified under, the EU-U.S. and Swiss-U.S. Data Privacy Frameworks (“DPF”) and the U.K. extension to the EU-U.S. DPF. TheIn DPF replaced the Privacy Shield Framework as an adequate mechanism by which EU companies may pass personal datarelation to the U.S. However, the DPF is already subject to legal challenge in Europe. Relatedly, whether and how other transfer mechanisms, such ascross standard contractual clauses, can be used to transfer personal data to the U.S. is in question. While the adequacy decision for the DPF helps to reduce the legal uncertainty of cross-borderborder transfers of personal data,information, we expect the long-termexisting validitylegal ofcomplexity theseand transferuncertainty mechanismsregarding remainsinternational uncertain.personal Ifinformation all or some jurisdictions within the EU or the U.K. determine that the latest standard contractual clauses also cannot be usedtransfers to transfer personal data to the U.S. and if the DPF is ultimately struck down in a manner similar to the Privacy Shield Framework, we could be left with no reasonable option for the lawful cross-border transfer of personal data. In such circumstances, continuing to transfer personal data from the EU to the U.S. could lead to governmental enforcement actions, litigation, fines and penalties or adverse publicity.continue. As the regulatory guidance and enforcement landscape in relation to data transfers continue to develop, we could suffer additional costs, complaints or regulatory investigations or fines; we may have to stop using certain tools and vendors and make other operational changes; we may have to implement alternative data transfer mechanisms under the GDPR or take additional compliance and operational measures, such as establishing systems to maintain certain data in the EEA, potentially involving substantial expense and causing us to divert resources from other aspects of our operations, all of which may adversely affect our business. Other jurisdictions have adopted or are considering cross-border or data residency restrictions, which could reduce the amount of data we can collect or process and, as a result, significantly impact our business.

Further, our legal risk depends in part on our clients’ or other third parties’ adherence to data privacy laws and regulations and their use of our services in ways consistent with end user expectations. There can be no assurances that the privacy and security-related measures and safeguards we have put into place in relation to these third parties will be effective to protect us and/or the relevant personal information from the risks associated with the third-party processing of such data. We rely on representations made to us by clients, partners and providers that they will comply with all applicable laws, including all relevant data privacy and data protection regulations. Although we make reasonable efforts to enforce such representations and contractual requirements, we do not fully audit our clients’ compliance with our recommended disclosures ornor theircan adherencewe be certain that our clients, partners and providers will adhere to data privacy laws and regulations. If our clients, partners or providers fail to adhere to our expectations or contracts in this regard, we and our clients could be subject to adverse publicity, damages and related possible investigation or other regulatory activity.

Adapting our business to enhanced and evolving privacy obligations across relevant jurisdictions could continue to involve substantial expense and may cause us to divert resources from other aspects of our operations, all of which may adversely affect our business. Additionally, as the advertising industry evolves, and new ways of collecting, combining and using data are created, governments may enact legislation in response to technological advancements and changesplaintiffs may explore novel legal theories that could result in ourus havingdeciding to re-design features or functions of our platform and related offerings, therefore incurring unexpected compliance costs. Further, adaptation of the digital advertising marketplace requires increasingly significant collaboration between participants in the market, such as publishers and advertisers. Failure of the industry to adapt to changes required for operating under existing and future data privacy laws, industry approaches that disfavor our platform and related offerings, and user response to such changes could negatively impact inventory, data, and demand. We cannot control or predict the pace or effectiveness of such adaptation, and we cannot currently predict the impact such changes may have on our business.

We deploy technical and organizational measures, internal policy controls, and contractual measures to limit how identifying information is used and shared and to help honor consumer choices. Nevertheless, we cannot guarantee any such measures or controls will be effective and handling identifying information increases our exposure under privacy and data protection laws. These laws and other obligations may be interpreted and applied in a manner that is inconsistent with our existing data management practices or the features of our platform and related offerings. If so, in addition to the possibility of fines, lawsuits and other claims, we could be required to fundamentally change our business activities and practices or modify our offerings, which could have an adverse effect on our business. In addition, public perception regarding data protection and privacy are significant in the programmatic advertising buying industry. Concerns about industry practices regarding the collection, use, and disclosure of personal data, whether or not valid and whether driven by applicable laws and regulations, industry standards, client or inventory provider expectations, or the broader public, may harm our reputation, result in loss of goodwill, and inhibit use of our platform or related offerings by current and future clients. For example, perception that our practices involve an invasion of privacy or are designed with insufficient protections, whether or not such practices are consistent with current or future laws, regulations, or industry practices, may subject us to public criticism, additional private class actions, reputational harm, or claims by regulators, which could disrupt our business and expose us to increased liability. We may be unable to make such changes and modifications to our business and offerings in a commercially reasonable manner or at all, and our ability to develop new offerings or certain features could be limited. All of this could impair our or our clients’ ability to collect, use, or disclose information relating to consumers, which could decrease demand for our platform and related offerings, increase our costs, and impair our ability to maintain and grow our client base and increase our revenue.

Our ability to successfully leverage user data and generate revenue from opportunities to serve advertisements could be impacted by restrictions imposed by laws or by third parties, including restrictions on our ability to use or read cookies, device identifiers, or other tracking features or our ability to use real-time bidding networks or other bidding networks. For example, if publishers or supply-side platforms decide to limit the data that we receive in order to comply (in their view) with state privacy laws orlaws, a potential federal privacy law,law or in response to other legal or industry developments, then our service may prove to be less valuable to our clients and we may find it more difficult to generate revenue. That is, if third parties on which we rely for data or opportunities to serve advertisements impose limitations (for whatever reason) or are restricted by other ecosystem participants or applicable regulations, then we may lose the ability to access data, bid on opportunities or purchase digital ad space, which could have a substantial impact on our revenue.

Today, digital advertising, including our platform, makes significant use of cookies to store device identifiers for the advertising activities described above. When we use cookies, they are generally considered third-party cookies, which are cookies owned and used by parties other than the owners of the website visited by the Internet user. The most commonly used Internet browsers—Chrome, Firefox,Safari, Internet Explorer and SafariFirefox —allow Internet users to modify their browser settings to prevent some or all cookies from being accepted by their browsers. Internet users can delete cookies from their computers at any time. Additionally, some browsers currently, or may in the future, block or limit some third-party cookies by default or may implement user control settings that algorithmically block or limit some cookies. Today, three major web browsers—Apple’s Safari, Mozilla’s Firefox and Microsoft’s Edge—block third-party cookies by default. Google’s web browser, Chrome, has introducedintroduced, newand is likely to continue to introduce, controls over third-party cookiescookies. andHowever, hadon announcedApril plans22, to deprecate support for third-party cookies and user agent strings entirely beginning in 2025. In July 2024,2025, Google announced that it waswould updatingmaintain its plancurrent approach to offering users third-party cookie choice in Chrome (thus, presumably, ending its efforts to deprecate third-party cookies in Chrome), and will not be rolling out a new standalone prompt for deprecation ofthird-party cookies andin would,Chrome. atFinally, someother pointparticipants in the future,real-time bidding ecosystem could decline to provide certain identifiers or introduce auser new experience in Chromesettings that allowsreduce usersthe number of identifiers provided to indicate a preference of an undefined typeus that wouldhelp apply in an unstated wayus to theoptimize user’ssupply webpaths, browsingtarget activity. Google has stated it will continue making its investmentsaudiences and testingmeasure various technologies under its label of “Privacy Sandbox” which may provide modified targeting and measurement functionality to digital advertising ecosystem participants as a limited replacement for the functionality currently provided through the use of third-party cookies. We believe that Google’s to-be-defined framework for browser-based user choice and its ongoing development of these technologies, which we expect to be technically complex and designed in a manner that does not favor us or our partners, has created and will likely continue to create industry uncertainty regarding the potential effects on user experience and advertiser targeting and measurement.outcomes. Although we believe our platform is well-positioned to adapt to suchbrowsers’ changes,blocking or limitation of some cookies, particularly with our Unified ID 2.0 offering, the impact of such changes — and broader scrutiny on the advertising technology ecosystem — remains uncertain and could be more disruptive than we anticipate, including to the display advertising ecosystem in particular, where such changes could adversely impact our growth in that channel.

Some Internet users also download free or paid ad-blocking software that not only prevents third-party cookies from being stored on a user’s computer, but also blocks all interaction with a third-party ad server. In addition, Google has introduced ad-blocking software in its Chrome web browser that will block certain ads based on quality standards established under a multi-stakeholder coalition. If such a feature inadvertently or mistakenly blocks ads that are not within the established blocking standards, or if such capabilities become widely adopted and the advertising technology industry does not collaboratively develop alternative technologies, our business could be harmed. The Interactive Advertising Bureau and Digital Advertising Alliance have also developed frameworks that allow users to opt out of the “sale” or use of their personal data for targeted advertising purposes under U.S. state privacy laws in ways that stop or severely limit the ability to show targeted ads. Because many state privacy laws require businesses to permit end users to opt out of processing their personal data for purposes of targeted advertising, including, in some statesstates, through automateddevice-based preference signals, we expect that more opt-out solutions will become available that may ultimately be used by end users, which may reduce our clients’ use of our platform and related offerings, and our business, financial condition, and results of operations could be adversely affected.

Advertising shown on mobile applications can also be affected by blocking or restricting use of mobile device identifiers. Data regarding interactions between users and devices are tracked mostly through stable, pseudonymous advertising identifiers that are built into the device operating system with privacy controls that allow users to express a preference with respect to data collection for advertising, including to disable the identifier. These identifiers and privacy controls are defined by the developers of the platforms through which the applications are accessed and could be changed by the platforms in a way that may negatively impact our business. For example, Apple has shifted to require user opt-in before permitting access to Apple’s unique advertising identifier, or IDFA, and Google has announced that it will eventually deprecate the mobile advertising identifier used on Android devices entirely. These changes have had, and will likely continue to have, a substantial impact on the mobile advertising ecosystem and could adversely impact our growth in this channel.

In addition, in the EU,EU and UK, national laws derived from Directive 2002/58/EC (as amended by Directive 2009/136/EC), commonly referred to as the ePrivacy or Cookie Directive, directs EU member states to ensureprovide that accessing information on an Internet user’s computer, such as through a cookie and other similar technologies, is allowed only if the Internet user has been informed about such access and given his or her consent. ARecent replacementEuropean for the ePrivacy Directive is currently under discussion by EU member states to complementcourt and bringregulator electronicdecisions communicationare servicesdriving inincreased line with the GDPR and force a harmonized approach across EU member states. Like the GDPR, the proposed ePrivacy Regulation applies extra-territoriallyattention to businesses established outside the EU who provide publicly available electronic communications services to, or gather data from the devices of, users in the EU. Though still subject to debate, the proposed ePrivacy Regulation may further raise the bar for the use of cookies and thesimilar finestracking and penalties for breach may be significant.technologies. We may be required to, or otherwise may determine that it is advisable to, make significant changes in our business operations and offerings to obtain user opt-in for cookies and use of cookie data, or develop or obtain additional tools and technologies to compensate for a lack of cookie data.

Increased transparency intoand scrutiny regarding the collection and use of data for digital advertising, introduced both through features in browsers and devices and regulatory requirements, such as the GDPR, U.S. state privacy laws and regulations, “Global Privacy Control” or similar opt-out signals and the ePrivacy Directive, as well as compliance with such requirements, may create operational burdens to implement and may lead more users to choose to block the collection and use of data about them. Adapting to these and similar changes has in the past and may in the future require significant time, resources and expense, which may increase our cost of operation or limit our ability to operate or expand our business.

•changes to our pricing or to the availability of and pricing of competitive products and services, and their effects on our pricingservices;

•changes in the pricing, cost or availability of third-party supplier-provided components of value-added services and data, including pricing structure changes and the alignment of our pricing model with our data partnerspartners, and our ability to successfully implement and rollout such changes;

•changes in our platform or related offerings, their features,features or their underlying components and design, and the mix of offerings that are adopted by our clients;

•improve our technology infrastructure,technology, including investing in internal technology development and acquiring outside technologies and investing in hosting infrastructure in an environment where a shortage of hosting capacity and hardware components is causing costs to increase;

Spend on our platform primarily comes through our agency clients. Many of our contracts with advertising agencies provide that if the advertiser does not pay the agency, the agency is not liable to us, and we must seek payment solely from the advertiser, a type of arrangement called sequential liability. Contracting with these agencies, which in some cases have or may develop higher-risk credit profiles, may subject us to greater credit risk than if we were to contract directly with advertisers. This credit risk may vary depending on the nature of an advertising agency’s aggregated advertiser base. In addition, typically, we are contractually required to pay advertising inventory and data suppliers within a negotiated period of time, regardless of whether our clients pay us on time, or at all. In addition, we typically experience slow payment cycles by advertising agencies as is common in our industry. While we attempt to negotiate long payment periods with our suppliers and shorter periods from our clients, we are not always successful. As a result, we oftengenerally face a timing issue withpay our accounts payable on shorter cycles than we collect on our accounts receivables, requiring us to remit payments from our own funds, and accept the risk of credit loss.

We may also be involved in disputes with clients, and in the case of agencies, their advertisers, over the operation of our platform, the terms of our agreements or our billings for purchases made by them through our platform. If we are unable to resolve disputes with our clients, we may lose clients or clients may decrease their use of our platform and our financial performance and growth may be adversely affected. If we are unable to collect or make adjustments to bills to clients, we could incur write-offs for credit loss,loss or reductions to revenue, respectively, which could harm our results of operations. In the future, credit loss may exceed reserves for such contingencies and our credit loss exposure may increase over time. Any increase in write-offs for credit loss could harm our business, financial condition and results of operations. Even if we are not paid by our clients on time or at all, we are still obligated to pay suppliers for the cost of advertising inventory, value-added services and data that clients purchase on our platform, and as a consequence, our business, financial condition and results of operations would be adversely impacted.

Campaigns are set up using several variables available to our clients on our platform. While our platform includes several checks and balances, it is possible for human error to result in significant overspending. The system requires a daily cap at the ad group level. We also provide for the client to input daily and overall caps at the advertising inventory campaign level at their discretion. Additionally, we set a credit limit for each user so that they cannot spend beyond the level of credit risk we are willing to accept. Despite these protections, the ability for overspend exists. For example, campaigns which last for a period of time can be set to pace evenly or as quickly as possible. If a client with a high credit limit enters the wrong daily cap with a campaign set to a rapid pace, it is possible for a campaign to accidentlyaccidentally go significantly over budget. While our client contracts state that clients are responsible for media purchased through our platform, we are ultimately responsible for paying the inventory providers, and we may be unable to collect from clients facing such issues, in which case our results of operations would be harmed.

We have a U.K. entity through which we have entered into international client and partner agreements, including with those in the EU, which are governed by English Law, and some of our clients and partners pay us in Euros, British Pounds and Euros.other foreign currencies.

In addition, if the stock market for technology companies, or the stock market generally, experiences a loss of investor confidence, the trading price of our Class A common stock could decline for reasons unrelated to our business, financial condition or results of operations. Stock prices of many technology companies have fluctuated in a manner unrelated or disproportionate to the operating performance of those companies. The trading price of our Class A common stock might also decline in reaction to events that affect other companies in our industry even if these events do not directly affect us. InFor theexample, past,in stockholdersFebruary haveand filedMarch 2025, securities class action litigation was filed against us following periodsa ofdrop marketin volatility.our Ifstock weprice. wereFor additional information regarding the pending legal proceedings, refer to becomeNote involved13—Commitments and Contingencies—Litigation. Our involvement in securities litigation,litigation it couldwill subject us to substantial costs, divert resources and the attention of management from our core business,business and may adversely affect our business.

Our Class B common stock has ten votes per share and our Class A common stock has one vote per share. Because of the ten-to-one voting ratio between our Class B and Class A common stock, the holders of our Class B common stock collectively have substantial control of the combined voting power of our common stock. Our amended and restated articles of incorporation provide that all Class B common stock will convert automatically into Class A common stock on December 22, 2025,2035, unless converted prior to such date. As of December 31, 2024,2025, stockholders who held shares of Class B common stock, including our executive officers, employees, and directors and their affiliates, together held approximately 49.3%49.9% of the voting power of our outstanding capital stock. This concentrated control limits or precludes your ability to influence corporate matters, as the holders of Class B common stock are able to influence or substantially control matters requiring approval by our stockholders, including the election of the directors, excluding the director we have designated as a Class A director, and the approval of mergers, acquisitions or other extraordinary transactions. Their interests may differ from yours and they may vote in a manner that is adverse to your interests. This ownership concentration may deter, delay or prevent a change of control of our company, deprive our stockholders of an opportunity to receive a premium for their common stock as part of a sale of our company and may ultimately affect the market price of our common stock. Furthermore, in connection with the dual class nature of our common stock, we have become subject to legal proceedings and could become involved in additional litigation, including securities class action claims and/or derivative litigation. Any such legal proceedings, regardless of outcome or merit, may divert management’s time and attention and may result in the incurrence of significant expense, including legal fees. For additional information regarding the pending legal proceedings, refer to “ItemNote 3.13—Commitments Legaland Proceedings.”Contingencies—Litigation.

Our amended and restated articles of incorporation and amended and restated bylaws contain provisions that could delay or prevent a change in control of our company. These provisions could also make it difficult for stockholders to elect directors that are not nominated by the current members of our board of directors or take other corporate actions, including effecting changes in our management. These provisions include the following provisions:

•require super-majority voting to amend certain provisions in our amended and restated articles of incorporation and amended and restated bylaws;

We offerare a self-service,global cloud-basedleader ad-buyingin platformadvertising thattechnology. empowersWe ourempower clientsad buyers to plan,create, manage, optimizemanage and measure more expressive data-drivenoptimize digital advertising campaigns. Our platform allows clients to execute integrated campaigns across ad formatsformats, channels and channels, including CTV and other video, display, audio, and native, on a multitude of devices, such as televisions, streaming devices, mobile devices, computers and digital-out-of-home devices. Our platform’s integrationsdepth, withAI majorcapabilities and rich ecosystem of inventory, publisher and data partnerspartner provideintegrations adenable buyerssuperior reach and decisioning capabilities,for andclients. In addition to the primary capabilities provided by our self-service platform, our enterprise APIs enableequip our clients with the ability to customize and expand platform functionality.

We believe that growth of the programmatic advertising market is important for our ability to grow our business. Adoption of programmatic advertising by advertisers allows us to acquire new clients and grow revenue from existing clients. Although our clients include some of the largest advertising agencies and advertisers in the world, we believe there is significant room for us to expand furtherour withinbusiness relationships with these clients andto gain a larger amountportion of their advertising spend through our platform. We also believe that the industry trends noted above will lead to advertisers adopting programmatic advertising through platforms such as ours. Accordingly, we see a significant market opportunity across advertisers and agencies with which we do not yet do business.

Similarly, the adoption of programmatic advertising by inventory owners and content providers allows us to expand the volume and type of advertising inventory we present to our clients. For example, we have expanded our CTV, audio and other advertising offerings through our integrations with supply-side partners and publishers. In addition, we have expanded our efforts to improve the efficiency and transparency of complex open internet supply channels.

We invest for long-term growth. We anticipate that our operating expenses will continue to increase in the foreseeable future as we invest in platform operations andfor our hosting capabilities as well as technology and development to enhance our platform,platform and related offerings, including programmaticour buyingcontinued focus on the development and incorporation of CTV ad inventory, and hosting capabilities.AI. We also anticipate that our sales and marketing expenses will continue to increase to acquire new clients and reinforce our relationships with existing clients. In addition, we expect to continue making investments in our infrastructure, including our information technology, financial and administrative systems and controls to support our growing operations.

We believe the markets outside of the United States, and in particular across Europe and Asia in markets such as the U.K,U.K., Germany, France, China, Japan, India and Australia, offer opportunities for growth. However, such markets may also pose challenges related to compliance with local laws and regulations, restrictions on foreign ownership or investment, uncertainty related to trade relations and a variety of additional risks. We intend to make additional investments in sales and marketing and product development to expand in international markets where we are making significant investments in our platform and growing our team.

Changes in interest andrates, foreign currency exchange rates, trade policies and practices, inflation and other geopolitical developments have resulted, and may continue to result, in a global slowdown of economic activity, which may decrease demand for a broad variety of goods and services in various industries, including those provided by our clients, while also disrupting supply channels,chains, sales channels and advertising and marketing activities for an unknown period of time until economic activity normalizes. In addition, due to high demand for hosting infrastructure components, their prices have become increasingly inelastic and the cost for such components has been rising. As a result of the current uncertainty in economic activity, we are unable to predict the size and duration of the impact on our revenue and our results of operations. The extent of the impact of these macroeconomic factors on our operational and financial performance will depend on a variety of factors, and the duration and extent of geopolitical and global economic disruption and their respective impacts on our clients, partners, industry and employees, all of which are uncertain at this time and cannot be accurately predicted. See “Item 1A. Risk Factors” in Part I of this Annual Report on Form 10-K for further discussion of the adverse impacts of macroeconomic uncertainty on our business.

Our recent growth has been largely driven by expanding our share of spend by our existing clients and adding new clients. Our clients include some of the largest advertising agencies and advertisers in the world, and we believe there is significant room for us to expand further within these clients.clients, including room to expand the aperture of customers we support across the mid-market. As a result, future revenue growth dependsdepends, in large part, upon our ability to retain our existing clients and to gain a larger amount of their spend through our platform in a highly competitive advertising market. This includes our ability to differentiate to clients our platform’s overall value from competitors’ platforms that may offer artificially low prices, which are enabled by inherent conflicts of interest and a lack of objectivity that come with also selling advertising inventory. We believe that we offer differentiated offerings with superior value to new and existing clients.

In order to analyze gross spend contributions and growth from new and existing clients, we measure annual gross spend on our platform for the set of clients, or cohort,clients that commenced spending on our platform in a specific year relative to subsequent periods. TheHistorically, grossour existing clients have generally increased their spend from each ofon our cohorts has increased over subsequent periods.platform. However, over time, weour will likely lose clients from each cohort,existing clients may spend less on our platform and the growth rate of gross spendrevenue may change. Any such change could have a significant negative impact on gross spendrevenue and operating results.

We enable the purchase of advertising inventory in a wide variety of ad formats and channels, including CTV and other video, display, audio, and native, on a multitude of devices, such televisions, streaming devices, mobile devices, computers and digital-out-of-home devices. Our future growth will depend on our ability to maintain and grow the inventory and spend across these channels, in addition to continued growth in CTV.CTV and potentially in any new inventory sources that may arise with the advent of AI. Our future growth will also depend on our ability to continue innovating and improving the technology underlying our platform and related offerings and enhancing their functionality, including the development of new or improved value-added services or the inclusion of additional data.data, and driving continual and increased adoption of such value-added services and data by our clients. We believe that our ability to integrate and offer CTV and other quality advertising inventory for purchase through our platform, our ability to continuously improve the features and functionality of our platform and related offerings and, in particular, our ability to manage the increased costs that will accompany these efforts, such as the cost of developing and hosting our growing, AI-rich platform and related offerings, will impact the future growth and profitability of our business.

In the advertising industry, companies commonly experience seasonal fluctuations in revenue. For example, many advertisers allocate the largest portion of their budgets to the fourth quarter of the calendar year in order to coincide with increased holiday purchasing. Historically, the fourth quarter of the year reflects our highest level of advertising activity and the first quarter reflects the lowest level of such activity. Additionally, advertising activity is typically heightened in the periods leading up to major United States political elections. We expect our revenue to continue to fluctuate based on seasonal factors that affect the advertising industry as a whole.

We generate revenue from clients who enter into agreements with us to use our platform to purchase advertising inventory, value-added services and data. We charge our clients for total spend on our platform, which includes spend and fees on advertising inventory, value-added services and data to support those purchases, in addition to the platform fee that is generally based on a percentage of our clients’ total spend on the platform. Generally, we report revenue as an agent on a net basis, which represents gross billings net of amounts we pay suppliers for the cost of advertising inventory, supplier-provided components of value-added services and data (collectively, “Supplier Components”).

Revenue asearned a percentage offrom gross spend on our platform may fluctuate duefrom period to period based on the types of services rendered and client-selectedthe featuresextent purchasedto throughwhich our platform’s value-added services and data are utilized by clients; our client and channel mix; changes in our platform or related offerings; pricing; volume discounts; and the amount of certain volumecosts discounts.of supplier-provided components of value-added services and data recorded as reductions to revenue versus as expenses in platform operations. We expect that our revenue asearned afrom percentageour ofclients’ gross spend will fluctuate in the future,future pursuant to these factors, especially as we introduce new and enhanced platform features onand ourrelated platformofferings that aremay be adopted by our clients, expand our omnichannel capabilities, extend our reach to more CTV and other inventory and add additional clients whose businesses may have different underlying business models.

Refer to “—Critical Accounting Policies and Estimates—Revenue Recognition” below for a description of our revenue recognition policies.

Platform Operations. Platform operations expense consists of expenses related to hosting our platform, which includes “internet traffic” associated with the viewing of available impressions or queries per second (“QPS”), and computing power to enable technical features and functionality such as AI, purchasing data used to inform and improve the platform and providing support to our clients. Platform operations expense includes hosting costs, including depreciation relating to data center computing and networking equipment, personnel costs, data-related costs and amortization of capitalized software costs for platform development. Personnel costs include salaries, bonuses, stock-based compensation, employee benefit costscosts, commission costs, bonuses and travel for personnel who support our platform and provide our clients with platform support. We capitalize certain costs associated with the development of our platform, which are amortized in platform operations expense over their estimated useful lives.

Our sales organization focuses on marketing our platform and related offerings to increase itstheir adoption by existing and new clients. We are also focused on expanding our international business by growing our sales teams in countries in which we currently operate, including in the United States and internationally, as well as establishing a presence in additional countries. As a result, we expect sales and marketing expenses to increase in absolute dollars in future periods. Sales and marketing expense as a percentage of revenue may fluctuate from period to period based on revenue levels and the timing of our investments in our sales and marketing functions as these investments may vary in scope and scale over periods and are impacted by the revenue seasonality in our industry and business.

Technology and Development. Technology and development expense consists primarily of personnel costs, including salaries, bonuses, stock-based compensation, employee benefits costs and traveltravel, as well as third-party consultant costs associated with the ongoing development of our platform and related offerings as well as integrations with our advertising inventory and data suppliers. Technology and development costs are expensed as incurred, except to the extent that such costs are associated with software development that qualifies for capitalization. We record capitalized software development costs related to platform development in other assets, non-current in our consolidated balance sheets, and we amortize those costs in platform operations expense.

We believe that continued investment in our platform is critical to attaining our strategic objectives and long-term growth. Therefore, we expect technology and development expense to increase as we continue to invest in the development of our platform and related offerings to support additional platform features and functionality, including AI and machine learning, increase the number of advertising inventory and data suppliers and support the anticipated increase in volume of advertising spendQPS on our platform. Our development efforts also include additional platform functionality to support our international expansion. We also intend to invest in technology to further automate our business processes.

General and Administrative. General and administrative expense consists primarily of personnel costs, including salaries, bonuses, stock-based compensation, employee benefits costs and travel associated with our executive, finance, legal, human resources, compliance and other administrative personnel, as well as accounting and legal professional services fees, local business taxes and fees and credit loss expense. General and administrative expenses also include stock-based compensation expense related to the CEO Performance Option.Option, which was granted in 2021.

We expect to continue to invest in corporate infrastructure and headcount to support growth. Excluding the impact of the CEO Performance Option, we expect general and administrative expenses to increase in absolute dollars in future periods. In addition, general and administrative expenses may fluctuate period to period due to various litigation, regulatory and governance matters, in which timing and extent of such expense is variable.

Interest Expense. Interest expense is mainly related to our debt, which carries a variable interest rate.rate and fees for undrawn amounts. Refer to “—Liquidity and Capital Resources — Credit Facility” below for further information.

Foreign Currency Exchange Loss (Gain), Net. Foreign currency exchange loss (gain), net consists primarily of gains and losses on foreign currency transactions net of gains and losses on foreign currency forwards. We do not designate foreign currency forwards as hedges for accounting purposes. We have foreign currency exposure related to our accounts receivable and, to a much lesser extent, accounts payable that are denominated in currencies other than the U.S. Dollar, principally the Euro, British Pound, Canadian Dollar, Australian Dollar, Japanese Yen, Indian Rupee, Indonesian Rupiah, Hong Kong DollarDollar, New Zealand Dollar, South Korean Won and Singapore Dollar.

The provision for income taxes consists primarily of U.S. federal, state and foreign income taxes. Our provision for income tax provisiontaxes may be significantly affected by changes to our estimates for tax in jurisdictions in which we operate, and other estimates utilized in determining the global effective tax rate. Actual results may also differ from our estimates based on changes in economic conditions. Such changes could have a substantial impact on the income tax provision. We evaluate the judgments surrounding our estimates and make adjustments, as appropriate, each reporting period. Our provision for income tax provisiontaxes may also be affected by the timing of vesting and/or exercise of our stock-based awards. The extent of the impact may be subject to volatility resulting from changes in our stock price and volume of transactions by employees.

Our effective tax rate differs from the U.S. federal statutory tax rate of 21% primarily due to researchthe andimpact developmentof taxstock-based credits,awards including non-deductible stock-based compensation net of tax benefits associated with employee exercises of stock options and vesting of restricted stock, nondeductiblestate stock-basedtaxes, compensationresearch and development tax credits and foreign tax rate differences and state taxes.effects.

The following discusses the results of our operations for the year ended December 31, 20242025, compared with the year ended December 31, 2023.2024. For a discussion of the results of our operations for the year ended December 31, 20232024, compared with the year ended December 31, 2022,2023, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023,2024, filed with SEC on February 15, 2024. References to “Notes” are notes to our consolidated financial statements in “Item 8. Financial Statements and Supplementary Data.”

Revenue asearned a percentage offrom gross spend inon theour aggregateplatform may fluctuate from period to period based on the types of services rendered and the extent to which our platform’s value-added services and data are utilized by clients; our client mix,and channel mix; changes in our platform or related offerings; pricing; volume discounts; and the extentamount toof whichcertain clientscosts utilizeof oursupplier-provided platform’scomponents of value-added services and data.data recorded as reductions to revenue versus as expenses in platform operations.

Platform operations expense increased by $106$147 million, or 29%,31%, for the year ended December 31, 2024,2025, as compared to the year ended December 31, 2023.2024. The increase was primarily due to increases of $80$123 million in hosting costs and $21$20 million in personnel costs, which included ana $8$5 million increase in stock-based compensation. The increase in hosting costs was primarily attributable to support costs relatedrelating to the increased use of our platform byto ourquery clients,ad opportunities and purchase ad impressions on the platform, increased use of features by our technical teams in support of our platform and investment in new data centers to support the continued growth of our platform. The increase in personnel costs was primarily due to headcount growth as well as the increase in stock-based compensation driven by new equity awards and the impact of the rising stock price on our 2024 employee stock purchase plan (the “ESPP”); an increase in platform support by engineers; headcount growth; an increase in taxes on equity awards; and an increase in travel.awards.

We expect platform operations expensesexpense to increase in absolute dollars in future periods as we continue to experience an increased volumesvolume of queries per second (“QPS”) and media impressions purchased through our platform, invest in our hosting capabilities and hire additional personnel to support our growth.platform;

Sales and marketing expense increased by $99$98 million, or 22%,18%, for the year ended December 31, 2024,2025, as compared to the year ended December 31, 2023.2024. The increase was primarily due to increases of $84$74 million in personnel costs, which included a $23$13 million increase in stock-based compensation, $10$17 million in marketing costs and $7 million in allocated facilities costs and $5 million in marketing costs. The increase in personnel costs was primarily due to headcount growth to support our sales efforts and to continue to develop and maintain relationships with our clients;clients, an increase in incentive compensation driven by grossheadcount, spendan growth;increase in severance benefit costs and an increase in travel.travel costs. The increase in stock-based compensation was primarily driven by new equity awardsawards. The increase in marketing costs was primarily due to an increase in marketing campaigns, creatives, client engagement, sponsorships and themarketing impact of the rising stock price on the ESPP.events. The increase in allocated facilities costs was primarily driven by new leases for additional office space to support our future growth as well as office support expenses. The increase in marketing costs was primarily due to an increase in marketing campaigns, events, sponsorships and client engagement.

We expect sales and marketing expenses to increase in absolute dollars in future periods, as we focus on increasing the adoption of our platform and related offerings with existing and new clients and expanding our international business.

Technology and development expense increased by $52$62 million, or 13%, for the year ended December 31, 2024,2025, as compared to the year ended December 31, 2023.2024. The increase was primarily due to increases of $43$52 million in personnel costs, which included ana $18$25 million increase in stock-based compensation, and $7$6 million in allocated facilities costs. The increase in personnel costs was primarily attributable to headcount growth to maintain and support further development of our platform,platform anand increaserelated offerings, partially offset by a decrease in taxes on equity awards and an increase in travel.awards. The increase in stock-based compensation was due to a $32 million increase primarily driven by new equity awards and the impact of the rising stock price on the ESPP; this was partially offset by the cancellation of unvested equity awards for our former Chief Technology Officer (“CTO”) in 2023, which resulted in the recognition of $14 million in incremental stock-based compensation in the year ended December 31, 2023, that did not recur in the year ended December 31, 2024. Refer to Note 10—Stock-Based Compensation for further detail.awards. The increase in allocated facilities costs was primarily driven by new leases for additional office space to support our future growth as well as office support expenses.

We expect technology and development expense to increase in absolute dollars as we continue to hire additional personnel, invest in the development of our platform and related offerings to support additional platform features and functionality,functionality including AI and machine learning, increase the number of advertising inventory and data suppliers and support the anticipated increase in volume of advertising spend by our clientsQPS on our platform. We also intend to invest in technology to further automate our business processes.

General and administrative expense increaseddecreased by $16$17 million, or 3%, for the year ended December 31, 2024,2025, as compared to the year ended December 31, 2023.2024. The increasedecrease was primarily due to a $48 million decrease in stock-based compensation, partially offset by increases of $33$18 million in administrative costs, $11 million in personnel costs and $28$2 million in administrativeallocated costs,facilities partially offset by a $46 million decrease in stock-based compensation. The increase in personnel costs was primarily due to increased headcount to support our growth, an increase in travel and an increase in taxes on equity awards. The increase in administrative costs was primarily driven by increases in external professional fees and local business taxes.costs. The decrease in stock-based compensation was primarily drivendue byto a $70$61 million decrease fromrelating to the CEO Performance Option driven by the graded-vesting attribution method, under which more expense is recognized earlier in the option’s life, partially offset by a $24$13 million increase primarily driven by new equity awards and an acceleration of stock-based compensation in connection with an executive transition. The increase in administrative costs was primarily driven by increases in external professional fees, including legal expenses for various litigation, regulatory and governance matters. The increase in personnel costs was primarily attributable to increased headcount to support our growth, partially offset by a decrease in cash incentive award expenses. The increase in allocated facilities costs was primarily driven by new leases for additional office space to support our future growth as well as theoffice impactsupport of the rising stock price on the ESPP.expenses.

Excluding the impact of the CEO Performance Option, the stock-based compensation for which is expected to be fully recognized by the first quarter of 2026, we expect general and administrative expenses to increase primarily due to continued investment in corporate infrastructureinfrastructure, headcount to support growth.growth and various litigation, regulatory and governance matters, for which expenses may fluctuate from period to period. For additional information regarding the CEO Performance Option, refer to Note 10— Stock-Based Compensation.

Total other income, net increaseddecreased by $13$11 million for the year ended December 31, 2024,2025, as compared to the year ended December 31, 2023.2024. The increasedecrease was primarily due to higherlower interest income on our cash and cash equivalents and short-term investments primarily driven by higherlower amounts invested asin wellmoney asmarket risingfunds and falling portfolio interest rates.

The difference between the effective tax rate in 20242025 of 23%33% and the U.S. federal statutory income tax rate of 21% was primarily due to nondeductible stock-based compensationcompensation, net of tax benefits associated with stock-based awards, and the impact of taxes in foreignstate and stateforeign jurisdictions, partially offset by research and development tax credits. For 2025, the impactprovision for income taxes included approximately $9 million of excess tax benefits associated with stock-based awards and research and development tax credits. For 2024, the provision for income taxes included $73 million of excess tax benefits associated with stock-based awards and $29$18 million of research and development tax credits.credits, excluding changes in unrecognized tax benefits.

The difference between the effective tax rate in 20232024 of 33%23% and the U.S. federal statutory income tax rate of 21% was primarily due to nondeductible stock-based compensationcompensation, net of tax benefits associated with stock-based awards, and the impact of taxes in foreign and state jurisdictions, partially offset by research and development tax credits. For 2024, the impactprovision from income taxes included approximately $73 million of excess tax benefits associated with stock-based awards and research and development tax credits. For 2023, the provision from income taxes included $53 million of excess tax benefits associated with stock-based awards and $23$30 million of research and development tax credits.credits, excluding changes in unrecognized tax benefits.

As of December 31, 2024,2025, we had working capital of $2,463$2.0 million,billion, which included $1,369$658 million in cash and cash equivalents, $88$104 million of which was held by our international subsidiaries, and $552$645 million in short-term investments in marketable securities. Additionally, we had $442$445 million available under our Amended Credit Facility (refer to the “Credit Facility” section below). For the year ended December 31, 2024,2025, we generated $739$993 million in cash flows from operating activities.

In the future, we may attempt to raise additional capital through the sale of equity securities or through equity-linked or debt-financing arrangements.arrangements, such as a new credit facility arrangement. If we raise additional funds by issuing equity or equity-linked securities, the ownership of our existing stockholders will be diluted. If we raise additional financing by incurring additional indebtedness, we may be subject to increased fixed payment obligations and could also be subject to additional restrictive covenants, such as limitations on our ability to incur additional debt, and other operating restrictions that could adversely impact our ability to conduct our business. Any future indebtedness we incur may result in terms that could be unfavorable to equity investors.

On December 17, 2021, we amended the Credit Facility to expand the process for issuing letters of credit and the related invoicing, particularly with respect to letters of credit not denominated in U.S. Dollars. On February 9, 2023, we further amended the Credit Facility (as amended, the “Amended Credit Facility”) to transition from a variable interest rate based on the London Interbank Offered Rate (“LIBOR”) to a variable interest rate based on the securedSecured overnightOvernight financingFinancing rateRate (“SOFR”).

Our primary investing activities consist of investing in short-term marketable securities, capital expenditures for property and equipment for the expansion of facilities to support our hosting capabilities and growing headcount as well as capital expenditures to develop our software in support of enhancing our platform.platform and related offerings. As our business grows, we expect our capital expenditures to increase, and our other investment activity may increase. Capital expenditures to support our hosting capabilities are also subject to rising prices for data center components, the timing, extent and duration of which cannot be predicted.

Our financing activities consist primarily of repurchases of our Class A common stock, proceeds from our stock-based award plans and taxes paid to net settle restricted stock awards.stock.

In 2024,2025, we used $108$1.4 millionbillion of cash in financing activities, consisting of $235$1.4 millionbillion of cash paid for repurchases of Class A common stock and $139$98 million of taxes paid for restricted stock award settlements, partially offset by $216$43 million of proceeds from the ESPP and $24 million of proceeds from stock option exercises and $50 million of proceeds from the ESPP.exercises.

In 2023,2024, we used $626$108 million of cash in financing activities, consisting of $647$235 million of cash paid for repurchases of Class A common stock and $79$139 million of taxes paid for restricted stock award settlements, partially offset by $61$216 million of proceeds from stock option exercises and $38$50 million of proceeds from the ESPP.

The loss of agencies or advertisers as clientsclients, especially those that represent relatively large amounts of our gross billings, could significantly harm our business, financial condition and results of operations. If we fail to maintain satisfactory relationships with an advertising agency, we risk losing business from the current and future advertisers represented by that agency.

We must maintain a consistent supply of quality ad inventory that is attractive to our clients. Our success depends on our ability to secure quality inventory on reasonable terms across a broad range of advertising networks and exchanges and social media platforms, including CTV and other video, mobile, display and audio inventory. The amount, quality and cost of inventory available to us can change at any time, including as publishers and other inventory suppliers respond to competition, consolidation among media companies or changes in the legal and regulatory landscape. A few inventory suppliers hold a significant portion of the programmatic inventory either generally or concentrated in a particular channel, such as audio and social media. In addition, we compete with companies with which we have business relationships. For example, Google is one of our largest advertising inventory suppliers in addition to being one of our competitors. If Google or any other company with attractive advertising inventory limits our access to its advertising inventory, our business could be adversely affected. If our relationships with certain of our suppliers were to cease, or if the material terms of these relationships were to change unfavorably, our business would be negatively impacted. Our suppliers are generally not bound by long-term contracts. As a result, there is no guarantee that we will have access to a consistent supply of quality inventory on favorable terms or at all. If we are unable to compete favorably for advertising inventory available on real-time advertising exchanges, or if real-time advertising exchanges decide not to make their advertising inventory available to us, we may not be able to place advertisements or find alternative sources of inventory with comparable traffic patterns and consumer demographics in a timely manner. Furthermore, the inventory that we access through real-time advertising exchanges may be of low quality or misrepresented to us, despite attempts by us and our suppliers to prevent fraud and conduct quality assurance checks.

If we fail to innovate or make the right investment decisions in our platform and related offerings, we may fail to attract and retain advertisers and advertising agencies and our revenue and results of operations may decline.be harmed.

A breach of our security, a flawed design, and/or our failure to respond sufficiently to a security incident could disrupt our services and result in theft, misuse, loss, corruption, or improper use or disclosure of our systems or data. This could result in government investigations, lawsuits (including class actions), enforcement actions and other legal and financial liability, and/or loss of confidence in the availability and security of our offerings, all of which could seriously harm our reputation and brand and impair our ability to attract and retain clients. As some of our offerings involve the receipt and processing of identifiable information, the risks associated with data, including risks related to a breach of our systemssystems, increases,increase, and we could be subject to contractual breach and indemnification claims from other clients and partners and otherwise suffer damage to our reputation, brand, and business. We could also be required to notify regulators, clients or other third parties. Our platform may also receive data in aggregated or pseudonymized form, and if our systems are breached and such data or information is compromised, it could be damaging to our brand, reputation, and business. Cyberattacks could also compromise our own trade secrets and other confidential information and result in such information being disclosed to others and becoming less valuable, which could negatively affect our business. Although we maintain errors or omissions and cyber liability insurance, the costs related to an incident or other security threats or disruptions may not be fully insured or indemnified by other means and insurance and other safeguards might only partially reimburse us for our losses, if at all. We also cannot guarantee that applicable insurance will be available to us in the future on economically reasonable terms or at all.

The market for talent in many of our areas of operations, including California and New York, is intensely competitive, as technology companies like ours compete to attract the best talent. As a business-to-business company, we do not have the same level of name recognition among potential recruits as business-to-consumer companies. Additionally, we have less experience with recruiting and less name recognition in geographies outside of the United States and may face additional challenges in attracting and retaining international employees. In addition, many companies now offer a remote or hybrid work environment, which may increase the competition for employees from employers outside of our traditional office locations. AsWe amay result,face wechallenges and may incur increasingly significant costs to attract and retain employees,highly skilled talent, including significant expenditures related to salaries and benefits and compensation expenses related to equity awards, and we may lose new employees to our competitors or other companies before we realize the benefit of our investment in recruiting and training them.

PeriodsWe have experienced, and may continue to experience, periods of significant change or transition, including leadership changes, organizational restructuring, oremployee shiftsturnover, inand the introduction of new strategic priorities,priorities. Such transitions can disrupt our operations andoperations, reduce efficiency. Such transitions may reduce continuity andefficiency, create uncertainty that mayuncertainty, delay decision-making and execution of key initiatives.initiatives Inand addition, these changes canadversely affect our corporate culture,culture decreaseand employee morale,morale. and lead to increasedIncreased employee turnover, includingparticularly among key personnel.personnel Losshas resulted, and may continue to result, in the loss of institutional knowledge and challenges in attracting and retaining highly skilled talent may further hinder productivity and collaboration. None of our key employees have an employment agreement for a specific term, and all of our employees may terminate their employment with us at any time. If we are unable to manage these transitions or executive successions effectively, our business, financial condition and results of operations could be adversely affected.

We have personnel in countries within North America, Central America, Europe, Asia and Australia, and we are continuing to expand our international operations. Some of the countries into which we are, or potentially may, expand score unfavorably on the Corruption Perceptions Index (“CPI”) of the Transparency International. Our teams in locations outside the United States are substantially smaller than some of our teams in the United States. To the extent we are unable to effectively engage with non-U.S. advertising agencies or international divisions of U.S. agencies due to our limited sales force capacity, or we are unable to secure quality non-U.S. ad inventory and data on reasonable terms due to our limited inventory and data team capacity, we may be unable to effectively grow in international markets.

Our Class B common stock has ten votes per share and our Class A common stock has one vote per share. Because of the ten-to-one voting ratio between our Class B and Class A common stock, the holders of our Class B common stock collectively have substantial control of the combined voting power of our common stock. Our amended and restated articles of incorporation provide that all Class B common stock will convert automatically into Class A common stock on December 22, 2035, unless converted prior to such date. As of MarchJune 31,30, 2026, stockholders who held shares of Class B common stock, including our executive officers, employees, and directors and their affiliates, together held approximately 50.2%50.3% of the voting power of our outstanding capital stock. This concentrated control limits or precludes your ability to influence corporate matters, as the holders of Class B common stock are able to influence or substantially control matters requiring approval by our stockholders, including the election of the directors, excluding the director we have designated as a Class A director, and the approval of mergers, acquisitions or other extraordinary transactions. Their interests may differ from yours and they may vote in a manner that is adverse to your interests. This ownership concentration may deter, delay or prevent a change of control of our company, deprive our stockholders of an opportunity to receive a premium for their common stock as part of a sale of our company and may ultimately affect the market price of our common stock. Furthermore, in connection with the dual class nature of our common stock, we have become subject to legal proceedings and could become involved in additional litigation, including securities class action claims and/or derivative litigation. Any such legal proceedings, regardless of outcome or merit, may divert management’s time and attention and may result in the incurrence of significant expense, including legal fees. For additional information regarding the pending legal proceedings, refer to Note 11—Commitments and Contingencies—Litigation.

The U.S. and non-U.S. tax laws applicable to our business activities are subject to interpretation and are changing. We are subject to audit by the Internal Revenue Service and by taxing authorities of the state, local and foreign jurisdictions in which we operate. Our tax obligations are based in part on our corporate operating structure, including the manner in which we develop, value, use and hold our intellectual property, the jurisdictions in which we operate, how tax authorities assess revenue-based taxes such as sales and use taxes and other indirect taxes such as value-added taxes, the scope of our international operations and the value we ascribe to our intercompany transactions. Taxing authorities may challenge, and have challenged, our tax positions and methodologies for valuing developed technology or intercompany arrangements, positions regarding the collection of sales and use taxes, and the jurisdictions in which we are subject to taxes, which could expose us to additional taxes. Any adverse outcomes of such challenges to our tax positions could result in additional taxes for prior periods, interest and penalties, as well as higher future taxes. In addition, our future tax expense could increase as a result of changes in tax laws, regulations or accounting principles, or as a result of earning income in jurisdictions that have higher tax rates. For example, the European Commission has proposed, and various jurisdictions, including a number of states in the United States, are considering enacting or have enacted laws that impose separate taxes on specified digital services, which may increase our tax obligations in such jurisdictions. In addition, the Organization for Economic Cooperation and Development announced an Inclusive Framework on Base Erosion and Profit Shifting, including Pillar Two Model Rules defining a global minimum tax, which calls for the taxation of large multinational corporations at a minimum rate of 15%. Further, on July 4, 2025, the United States enacted the One Big Beautiful Bill Act that changes or makes permanent certain tax laws for corporations. On June 29, 2026, the State of California enacted Senate Bill 122, which, among other changes, extended annual limitations on research and development credits, which may limit or delay the realizability of tax benefits from the Company’s research and development efforts in California; in addition, Senate Bill 122 expanded its state sales and use tax base to include digital products beginning January 1, 2027. While the changes from these rules have not negativelyhad impacteda significant, negative impact to our financial condition or results of operations, they could increase our effective tax rate and cash tax paymentspayments, or otherwise negatively impact our profitability, in future periods. Any increase in our tax expense could have a negative effect on our financial condition and results of operations. Moreover, the determination of our provision for income taxes and other tax liabilities requires significant estimates and judgment by management, and the tax treatment of certain transactions is uncertain. Any changes, ambiguity, or uncertainty in taxing jurisdictions’ administrative interpretations, decisions, policies and positions, including, the position of taxing authorities with respect to revenue generated by reference to certain digital services, could also materially impact our income tax liabilities. Although we believe we will make reasonable estimates and judgments, the ultimate outcome of any particular issue may differ from the amounts previously recorded in our financial statements and any such occurrence could materially affect our financial condition and results of operations.

We investremain forfocused on operating efficiently while investing in significant opportunities to contribute toward long-term growth. We anticipate that our platform operations and technology and development operating expenses will continue to increase in the foreseeable future as we invest in platform operations for our hosting capabilities as well as technology and development to enhance our platform and related offerings, including our continued focus on the development and incorporation of AI. We also anticipateaim thatfor ourbalanced investments in sales and marketing expensesactivities willin continue to increaseorder to acquire new clients and reinforce our relationships with existing clients. In addition, we expect to continue making disciplined investments in our infrastructure, including our information technology, financial and administrative systems and controls to support our growing operations.

We believe the markets outside of the United States, and in particular across Europe and Asia in markets such as the U.K., Germany, France, China, Japan, India and Australia, offer opportunities for growth. We intend to make additional investments in sales and marketing and product development to expand in international markets where we are making significantbalanced investments in our platform and growing our team.team to capitalize on the opportunity in international markets.

Our business model has allowed us to grow significantly,significantly over the long term, and we believe that our operating leverage enables us to support future long-term growth profitably.

Results of Operations for the Three and Six Months Ended MarchJune 31,30, 2026 Compared with the Three and Six Months Ended MarchJune 31,30, 2025

Revenue increased by $73$21 million, or 12%,3%, for the three months ended MarchJune 31,30, 2026, as compared to the three months ended MarchJune 31,30, 2025. The increase was primarily due to an increase in gross spend on our platform, which was primarily driven by more overall advertising campaigns executed by new andclients, partially offset by a decrease in gross spend from existing clients and increased application of and changes in the mix of revenue-generating value-added services.clients. The increase in revenue was also driven by a higher proportion of revenue earned from client spend due to increased pricing associated with value-added services, higheras utilizationwell as the continued evolution of ourcertain value-added services and higherdata offerings, including changes to the use of supplier-provided components within those offerings, which resulted in the recognition of certain costs in platform fees.operations Enhancementsrather than as reductions to ourrevenue. platformThese andincreases thewere value-addedpartially servicesoffset availableby to clients, including from Kokaivolume and other features,discounts in connection with joint business plans and increasedother pricingstrategic associatedpartnerships within value-addedan services, enabled both our clients and useffort to capturedrive increasedfuture value and drove higher utilization of our value-added services.growth.

Revenue earned from our clients’ gross spend on our platform may fluctuate from period to period based on the types of services rendered and the extent to which our platform’s value-added services and data are utilized by clients; our client and channel mix; changes in our platform or related offerings; pricing; volume and other discounts; and the amount of certain costs of supplier-provided components of value-added services and data recorded as reductions to revenue versus as expenses in platform operations. We expect that our revenue earned from our clients’ gross spend will fluctuate in the future pursuant to these factors, especially as our platform evolves and we introduce new and enhanced platform features and related offerings that may be adopted by our clients, expand our omnichannel capabilities, continue to enter into joint business plans and other strategic partnerships, extend our reach to more CTV and other inventory and add additional clients whose businesses may have different underlying business models.

Platform operations expense increased by $39$33 million, or 27%,22%, for the three months ended MarchJune 31,30, 2026, as compared to the three months ended MarchJune 31,30, 2025. The increase was primarily due to increases of $23$18 million in costs from supplier-provided components of value-added services and data, $8 million in hosting costs, $11 million in data-related costs and $4$3 million in personnel costs. The increase in costs from supplier provided-components of value-added services and data was primarily attributable to the continued evolution of certain value-added services and data offerings, including changes to the use of supplier-provided components within those offerings, which resulted in the recognition of certain costs in platform operations rather than as reductions to revenue. The increase in hosting costs was primarily attributable to investment in new data centers to support the continued growth of our platform; support costs relating to the increased use of our platform to query ad opportunities and purchase ad impressions while leveraging the AI and machine learning capabilities of our platform; investment in new data centers to support the continued growth of our platform; and increased use of features by our technical teams in support of our platform. The increase in data-relatedhosting costs was primarilypartially attributableoffset by a gain on the sale of computing and networking equipment in connection with a normal-course decommissioning of certain data center assets as well as a change in the estimated useful lives of certain other data center computing and networking equipment. Refer to investmentsNote in2 supplier-provided- componentsBasis of value-added servicesPresentation and dataSummary toof informSignificant andAccounting improvePolicies ourfor platformadditional and related offerings.information. The increase in personnel costs was primarily due to headcount growth.

We expect platform operations expense will fluctuate period to increaseperiod, in absolute dollars in future periodsincluding as wea continuepercentage of revenue. We expect to experience an increased volume of queries per second (“QPS”) and media impressions purchased through our platform; and invest in our hosting capabilities, including to support new technical features and functionality of our platform and related offerings and our growing AI and machine learning capabilities, subject to rising prices for data center components;components. andWe expect to invest in hiring and retaining top talent to support our clients.clients Platformwhile operationsbalancing expenseplatform assupport aneeds percentagewith ofother revenuestrategic may fluctuate period to period based on revenue levels and the timing of these investments in our hosting capabilities, as we continue to strategically invest in efficient data center computing and networking capacity.priorities. Platform operations expense also may vary due to the amount of certain costs of supplier-provided components of value-added services and data recorded as platform operations expense versus as reductions to revenue.

Sales and marketing expense increased by $19$13 million, or 13%,8%, for the three months ended MarchJune 31,30, 2026, as compared to the three months ended MarchJune 31,30, 2025. The increase was primarily due to increases of $18$11 million in personnel costs and $1$3 million in marketing costs. The increase in personnel costs was primarily due to an increase in incentive compensation driven by changes in incentive plan structure, salary increases in connection with regular merit and promotion cycles and an increase in headcount to support our sales efforts and to continue to develop and maintain relationships with our clients and an increase in incentive compensation driven by changes in incentive targets, commissionable headcount growth and gross spend growth.clients. The increase in marketing costs was primarily due to an increase infrom marketing campaigns, creatives and client engagement.events.

Technology and development expense increased by $10$6 million, or 8%,5%, for the three months ended MarchJune 31,30, 2026, as compared to the three months ended MarchJune 31,30, 2025. The increase was due to an increaseincreases of $9$4 million in personnel costs and $2 million in third-party costs. The increase in personnel costs was primarily attributable to headcount growth to maintain and support further development of our platform and related offerings.offerings as well as salary increases in connection with regular merit and promotion cycles. The increase in third-party costs was primarily attributable to increased use of AI software tools to support our development efforts.

We expect technology and development expense towill increasefluctuate in absolutefuture dollarsperiods, including as a percentage of revenue, as we continueoptimize toour focus on hiring and retaining top talent, investinvestments in the development of our platform and related offerings to support additional platform features and functionalityfunctionality, including AI and machine learning, the anticipated increase the number ofin advertising inventory and data suppliers and support the anticipated increase in volume of QPS on our platform. We expect to invest in hiring and retaining top talent as well as utilizing other development tools, such as AI, to optimize for our business and focus development on offerings that support efficient and scalable growth.

General and administrative expense decreased by $8$17 million, or 6%,13%, for the three months ended MarchJune 31,30, 2026, as compared to the three months ended MarchJune 31,30, 2025, primarily due to a $16$20 million decrease in stock-based compensation, partially offset by an increase of $8$3 million in personnel costs. The decrease in stock-based compensation was primarily due to a $19 million decrease relating to the CEO Performance OptionOption, drivenwhich was fully recognized by the graded-vestingend attribution method, under which more expense is recognized earlier inof the option’sfirst life, partially offset by a $3 million increase primarily driven by an accelerationquarter of stock-based compensation in connection with an executive transition.2026. The increase in personnel costs was primarily attributable to increased headcount to support our growth, an increase in severance benefit costs and salary increases in connection with regular merit and promotion cycles,cycles as wewell continueas increased headcount to investsupport inour attracting and retaining top talent.growth.

Total other income, net, decreased by $9$5 million for the three months ended MarchJune 31,30, 2026, as compared to the three months ended MarchJune 31,30, 2025. The decrease was primarily due to lower interest income on our cash and cash equivalents and short-term investments primarily driven by lower amounts invested and falling portfolio interest rates as well as foreign currency transaction losses driven by changes in foreign currency exchange rates against the U.S. Dollar, partially offset by gains on foreign currency forwards.

The U.S. federal statutory tax rate was 21% for the three and six months ended MarchJune 31,30, 2026 and 2025.

The provision for income taxes increased by $14$6 million for the three months ended MarchJune 31,30, 2026, as compared to the three months ended MarchJune 31,30, 2025. The increase was primarily due to tax detriments associated with employee stock-based awards, compared to tax benefits associated with employee stock-based awards in the three months ended MarchJune 31,30, 2025.2025, partially offset by lower pre-tax profitability.

As of MarchJune 31,30, 2026, we had working capital of $2.0 billion, which included $878$1.1 millionbillion in cash and cash equivalents, $128$92 million of which was held by our international subsidiaries, and $528$362 million in short-term investments in marketable securities. Additionally, as of MarchJune 31,30, 2026, we had $445$745 million available under our Amended CreditRevolving Facility (refer to “— Credit Facility” below). For the threesix months ended MarchJune 31,30, 2026, we generated $392$545 million in cash flows from operating activities.

On June 15, 2021, we and a syndicate of banks, led by JPMorgan Chase Bank, N.A., as agent, entered into a Loan and Security Agreement (the “Credit Facility”). The Credit Facility consistsconsisted of a $450 million revolving loan facility, with a $20 million sublimit for swingline borrowings and a $15 million sublimit for the issuance of letters of credit. Under certain circumstances, we havehad the right to increase the Credit Facility by an amount not to exceed $300 million.

Outstanding letters of credit under the Amended Credit Facility continuecontinued in full and unchanged subsequent to the execution of the Restated Loan and Security Agreement. No outstanding debt balance existed under the Amended Credit Facility at the time of the execution of the Restated Loan and Security Agreement. We paid immaterial accrued interest and fees upon execution of the Restated Loan and Security Agreement. The Revolving Facility has a scheduled maturity of April 14, 2031, at which time all outstanding amounts become due and payable, subject to certain extension mechanics set forth in the Restated Loan and Security Agreement.

As of December 31, 2025, $150 million remained available and authorized for repurchases. In February 2026, an additional $350 million was authorized under this program, bringing the total amount available for future repurchases to $500 million. During the three months ended MarchJune 31,30, 2026, we repurchased and subsequently retired 73 million shares of our Class A common stock for an aggregate repurchase amount of $174$59 million. During the six months ended June 30, 2026, we repurchased and subsequently retired 10 million shares of our Class A common stock for an aggregate repurchase amount of $233 million. The aggregate repurchase amountamounts for the three and six months ended MarchJune 31,30, 2026, included $1immaterial millionamounts relating to the 1% excise tax on share repurchases, net of share issuances, from the Inflation Reduction Act of 2022 (“IRA”). As of MarchJune 31,30, 2026, $327$269 million remained available and authorized for repurchases.

For the threesix months ended MarchJune 31,30, 2026, cash provided by operating activities of $392$545 million resulted primarily from net income adjusted for noncash items of $209$418 million and a net increase from our operating assets and liabilities of $182$127 million. The net increase from our operating assets and liabilities was primarily due to a $429$548 million decrease in accounts receivable and a $59$60 million decrease in prepaid expenses and other assets, partially offset by a $279$428 million decrease in accounts payablepayable, a $36 million decrease in operating lease liabilities and a $17 million decrease in operatingaccrued leaseexpenses and other liabilities. The decrease in accounts receivable was due to the timing and seasonality of cash receipts from clients. The decrease in prepaid expenses and other assets was primarily due to a reduction in income taxes receivable driven by the receipt of a tax refund and the current tax provisionprovision, net of tax payments, partially offset by prepayments to certain cloud-based hosting and data-relatedthe servicereceipt providers.of a tax refund. The decrease in accounts payable was due to the timing and seasonality of payments for Supplier Components. The decrease in operating lease liabilities was primarily due primarily to rent payments. The decrease in accrued expenses and other liabilities was primarily due to the timing and seasonality of payments for certain personnel costs and a reduction of the liability relating to the ESPP due to the purchase of shares in accordance with the plan.

For the threesix months ended MarchJune 31,30, 2025, cash provided by operating activities of $291$456 million resulted primarily from net income adjusted for noncash items of $208$470 million and a net increasedecrease from our operating assets and liabilities of $83$14 million. The net increasedecrease from our operating assets and liabilities was due to a $282$32 million decrease in accountsoperating receivable,lease liabilities, a $29$24 million increasedecrease in accrued expenses and other liabilities andliabilities, a $20 million decrease in accounts payable and an $18 million increase in prepaid expenses and other assets, partially offset by aan $235$80 million decrease in accounts payablereceivable. and a $14 millionThe decrease in operating lease liabilities. The decrease in accounts receivableliabilities was due primarily to therent timing and seasonality of cash receipts from clients.payments. The increasedecrease in accrued expenses and other liabilities was primarily due to antax increasepayments inagainst the prior year income tax liability drivenand bya the current income tax provision, netreduction of tax payments, and an increase inthe liability relating to the ESPP employeedue contributions towardto the upcoming purchase of shares,shares in accordance with the plan, partially offset by athe timing of payment for certain personnel costs. The decrease in incentiveaccounts compensationpayable liabilitieswas drivendue byto the timing and the seasonality of ourpayments business.to suppliers for Supplier Components. The decreaseincrease in prepaid expenses and other assets was primarily due to estimated tax payments, partially offset by the current tax provision and the timing of payment for employee engagement costs, including for travel and in-person events that occurred in the first quarter of 2025. The decrease in accounts payablereceivable was due to the timing and seasonality of paymentscash toreceipts suppliersfrom for Supplier Components. The decrease in operating lease liabilities was due primarily to rent payments.clients.

Our primary investing activities consist of investing in short-term marketable securities, capital expenditures for property and equipment for the expansion of facilities to support our hosting capabilities and growing headcount as well as capital expenditures to develop our software in support of enhancing our platform and related offerings. As our business grows, ourOur capital expenditures and other investment activity may increase.fluctuate based on liquidity needs and investment priorities, such as for hosting capabilities, platform development and repurchases of our Class A common stock in financing activities. Capital expenditures to support our hosting capabilities are also subject to rising prices for data center components, the timing, extent and duration of which cannot be predicted. From time to time, we may engage in sales of certain long-lived assets based upon business needs and market factors.

For the threesix months ended MarchJune 31,30, 2026, cash provided by investing activities of $0.5$165 million primarily resulted from $116$283 million of net maturities and sales of short-term investments,investments and $16 million of proceeds from the sale of property and equipment, partially offset by $113$126 million to purchase property and equipment and $3$7 million of investments in capitalized software.

For the threesix months ended MarchJune 31,30, 2025, we used $133$346 million of cash in investing activities, consisting of $66$232 million of net purchases of short-term investments, $59$104 million to purchase property and equipment, $6 million of investments in capitalized software and $4 million for the acquisition of certain assets accounted for as a business combination and $3 million of investments in capitalized software.combination.

For the threesix months ended MarchJune 31,30, 2026, we used $172$246 million of cash in financing activities, consisting of $164$241 million of cash paid for repurchases of our Class A common stock and $11$21 million of taxes paid for restricted stock settlements, partially offset by $2$12 million of proceeds from our ESPP and $5 million of proceeds from stock option exercises.

For the threesix months ended MarchJune 31,30, 2025, we used $410$583 million of cash in financing activities, consisting of $386$647 million of cash paid for repurchases of our Class A common stock and $31$57 million of taxes paid for restricted stock settlements, partially offset by $8$74 million of proceeds from short-term borrowings, $32 million of proceeds from our ESPP and $14 million of proceeds from stock option exercises.

We do not have any relationships with other entities or financial partnerships, such as entities often referred to as structured finance or special purpose entities that have been established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes. We did not have any off-balance sheet arrangements at MarchJune 31,30, 2026 other than the indemnification agreements described below.

The following table summarizes our non-cancelable contractual obligations as of MarchJune 31,30, 2026 (in thousands):

In the ordinary course of business, we enter into agreements in which we may agree to indemnify clients, suppliers, vendors, lessors, business partners, lenders, stockholders and other parties with respect to certain matters, including losses resulting from claims of intellectual property infringement, damages to property or persons, business losses or other liabilities. Generally, these indemnity and defense obligations relate to our own business operations, obligations and acts or omissions. However, under some circumstances, we agree to indemnify and defend contract counterparties against losses resulting from their own business operations, obligations and acts or omissions, or the business operations, obligations and acts or omissions of third parties. These indemnity provisions generally survive termination or expiration of the agreements in which they appear. In addition, we have entered into indemnification agreements with our directors, executive officers and other officers that will require us to indemnify them against liabilities that may arise by reason of their status or service as directors, officers or employees. In the ordinary course of business, demands have been made upon us to provide indemnification under such agreements, but we are not aware of any claims that could have a material effect on our condensed consolidated financial statements. Accordingly, no material amounts have been recorded at MarchJune 31,30, 2026.

The following table presents a reconciliation of net income, the most comparable GAAP measure, to Adjusted EBITDA for the three and six months ended MarchJune 31,30, 2026 and 2025 (in thousands):

We believe that the assumptions and estimates associated with the evaluation of revenue recognition criteria, including the determination of revenue recognition as net versus gross in our revenue arrangements such as whether supplier-provided components of value-added services and data should be recognized as reductions to revenue or expenses recorded in platform operations; stock-based compensation expense; and income taxes, including the realizability of deferred tax assets, have the greatest potential impact on our condensed consolidated financial statements. Therefore, we consider these to be our critical accounting policies and estimates. Refer to “Critical Accounting Policies and Estimates” contained in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2025, for a complete discussion of our critical accounting estimates. There have been no material changes to ourthese critical accounting policies or estimates since our Annual Report on Form 10-K for the year ended December 31, 2025.