Financial Analysis

Commitments and Contingencies Legal Proceedings The Company may become party to various legal actions during the ordinary course of business. Defending such proceedings is costly and can impose a significant burden on management and employees, it may receive unfavorable preliminary or interim rulings during litigation, and there can be no assurances that favorable final outcomes will be obtained. In addition, the Companys industry is characterized by the existence of a large number of patents, copyrights, trademarks, trade secrets and other intellectual property and proprietary rights. Companies in our industry are often required to defend against litigation claims based on allegations of infringement or other violations of intellectual property rights. Furthermore, client agreements typically require the Company to indemnify clients against liabilities incurred in connection with claims alleging its solutions infringe the intellectual property rights of a third party. From time to time, the Company has been involved in disputes related to patent and other intellectual property rights of third parties, none of which has resulted in material liabilities. The Company expects these types of disputes may continue to arise in the future. Based upon present information, the Company believes that its liability, if any, arising from such pending legal proceedings, asserted legal claims and known potential legal claims that are likely to be asserted, is not reasonably likely to be mat …

CommitmentsAndContingenciesDisclosureTextBlock · excerpt; the full note is in the filing

Debt Amended Credit Facility On February 27, 2025, the Company entered into a Third Amendment (the Third Amendment) to the Companys Amended and Restated Credit Agreement dated as of April 29, 2022 (as amended, the Amended Credit Agreement), with Silicon Valley Bank, a division of First-Citizens Bank & Trust Company, as administrative agent, and other lenders party thereto. The Third Amendment, among other things, (i) extended the maturity date of the revolving commitment from April 29, 2027 to February 27, 2030, (ii) increased the amount of the revolving loan commitment by $100 million, for a total revolving commitment of $225 million (the Revolving Facility), (iii) extended the Financial Covenant Trigger Date (as defined therein) to December 31, 2026 or such earlier date as designated by the Company, (iv) reduced the applicable interest rate margins (1) prior to the Financial Covenant Trigger Date, from SOFR plus 3.00% to 3.50% per annum to SOFR plus 2.75% to 3.25% per annum, based on the Recurring Revenue Leverage Ratio (as defined therein) and (2) on or after the Financial Covenant Trigger Date, from SOFR plus 1.50% to 3.00% per annum to SOFR plus 1.25% to 2.50% per annum, based on the Consolidated Total Net Leverage Ratio (as defined therein), (v) permitted the acquisition of MANTL pursuant to the terms of the Merger Agreement, (vi) permitted certain Permitted Convertible Indebtedness and Permitted Equity Derivative Transactions (as such terms are defined therein), su …

DebtDisclosureTextBlock · excerpt; the full note is in the filing

The following table disaggregates the Company's revenue by major source for the three and six months ended June 30, 2026 and 2025: Three months ended June 30, Six months ended June 30, (in thousands) 2026 2025 2026 2025 SaaS subscription services $ 122,975 $ 105,859 $ 243,753 $ 198,667 Implementation services 3,326 3,244 6,985 5,516 Other services 3,543 2,956 5,244 5,711 Total revenues $ 129,844 $ 112,059 $ 255,982 $ 209,894

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Stockholders' Equity Equity Compensation Plans Stock-based compensation expense was included in the Unaudited Condensed Consolidated Statements of Operations as follows: Three months ended June 30, Six months ended June 30, (in thousands) 2026 2025 2026 2025 Cost of revenues $ 1,798 $ 1,706 $ 3,228 $ 4,342 Research and development 5,139 5,424 10,384 10,858 Sales and marketing 2,350 3,550 5,308 6,397 General and administrative 8,205 8,835 15,882 17,920 Total stock-based compensation expenses $ 17,492 $ 19,515 $ 34,802 $ 39,517 In connection with the acquisition of MANTL in March 2025, the vesting of certain outstanding unvested equity awards were accelerated and settled in cash, resulting in the Company recognizing $3.9 million of stock-based compensation expense for the six months ended June 30, 2025. Stock Repurchase Program On April 23, 2026, the Board of the Directors of the Company (the Board) authorized a stock repurchase program to repurchase up to $100.0 million of the Companys common stock, through December 31, 2028. Repurchases under the program may be made from time to time, at managements discretion, using a variety of methods, including open market purchases, privately negotiated transactions, and other means all in accordance with federal securities laws and other applicable legal requirements, including pursuant to one or more Rule 10b5-1 trading plans. The timing and size of any repurchases will be determined by management based on prevailing share prices, gene …

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Fair Value of Financial Instruments The Companys financial instruments consist primarily of cash, cash equivalents, marketable securities, accounts receivable and accounts payable. The carrying values of cash, cash equivalents, accounts receivable and accounts payable approximate their respective fair values due to the short-term nature of these instruments. Cash equivalents include amounts held in money market accounts that are measured at fair value using observable market prices. Marketable securities include debt securities that are measured at fair value using observable inputs. The Company uses a three-tier fair value hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value: Level 1. Quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2. Significant other inputs that are directly or indirectly observable in the marketplace. Level 3. Significant unobservable inputs that are supported by little or no market activity. The Company evaluates its financial assets and liabilities subject to fair value measurements on a recurring basis to determine the appropriate level in which to classify them for each reporting period. The following tables summarize the Companys financial assets measured at fair value as of June 30, 2026 and December 31, 2025 and indicate the fair value hierarchy of the valuation: Fair Value at Reporting Date Using (in thousands) June 30, 2026 Level 1 Level 2 Level 3 Assets: Cash …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

Goodwill and Other Intangibles Goodwill and intangible assets deemed to have an indefinite life are not amortized, but are reviewed annually for impairment of value or when indicators of a potential impairment are present. As part of the Companys business planning cycle, the Company performs an annual goodwill impairment test in the fourth quarter of the fiscal year. There were no indications of impairment of goodwill noted as of June 30, 2026. Goodwill has a carrying value of $403.4 million as of both June 30, 2026 and December 31, 2025. Total intangible assets consisted of the following as of June 30, 2026 and December 31, 2025: As of June 30, 2026 (in thousands) Carrying Value Accumulated Amortization Net Carrying Value Finite-lived: Customer Relationships $ 92,800 $ (12,407) $ 80,393 Developed Technology 99,200 (39,288) 59,912 Tradenames 6,450 (1,076) 5,374 Total amortizable intangible assets 198,450 (52,771) 145,679 Website domain name (Indefinite-lived) 25 25 Total intangible assets $ 198,475 $ (52,771) $ 145,704 As of December 31, 2025 (in thousands) Carrying Value Accumulated Amortization Net Carrying Value Finite-lived: Customer Relationships $ 92,800 $ (9,314) $ 83,486 Developed Technology 99,200 (29,462) 69,738 Tradenames 6,450 (756) 5,694 Total amortizable intangible assets 198,450 (39,532) 158,918 Website domain name (Indefinite-lived) 25 25 Total intangible assets $ 198,475 $ (39,532) $ 158,943 Amortization expense recognized on intangible assets was $6.6 millio …

GoodwillAndIntangibleAssetsDisclosureTextBlock · excerpt; the full note is in the filing

Income Taxes The Company recorded income tax benefit of $0.2 million and income tax expense of $2.5 million for the three and six months ended June 30, 2026, respectively, resulting in an effective tax rate of 2.3% and (15.6)%, respectively, compared to income tax benefit of $4.3 million and $11.6 million for the three and six months ended June 30, 2025, respectively, resulting in an effective tax rate of 24.0% and 35.1%, respectively. The Companys effective tax rates for the three and six months ended June 30, 2026 and 2025 differ from the U.S. statutory tax rate primarily due to unfavorable permanent differences and changes in the valuation allowance recorded against the Companys deferred tax assets. For the three and six months ended June 30, 2025, the effective tax rate was further impacted by a deferred tax benefit resulting from the partial release of a pre-existing valuation allowance in connection with the MANTL business combination. The Company recognizes deferred tax assets and liabilities based on the estimated future tax effects of temporary differences between the financial statement basis and tax basis of assets and liabilities given the provisions of enacted tax law. Management reviews deferred tax assets to assess their future realization by considering all available evidence, both positive and negative, to determine whether a valuation allowance is needed for all or some portion of the deferred tax assets, using a more likely than not standard. The assessment …

IncomeTaxDisclosureTextBlock · excerpt; the full note is in the filing

Leases The Company leases office space under non-cancellable operating leases for its corporate headquarters in Plano, Texas. On February 24, 2026, the Company entered into an agreement for an office lease in India that became effective on March 9, 2026, with a lease term of five years. The Company recognized a lease liability and ROU asset of $4.8 million for the India lease that was included in the Condensed Consolidated Balance Sheets as of March 31, 2026. Operating lease expense consisted of: Three months ended June 30, Six months ended June 30, (in thousands) 2026 2025 2026 2025 Operating lease expense $ 854 $ 671 $ 1,626 $ 1,343 Short-term lease expense and other (1) 357 351 663 526 Total lease expense $ 1,211 $ 1,022 $ 2,289 $ 1,869 (1) Other lease expense includes variable lease expense. Supplemental Cash Flow Information Six months ended June 30, Cash flow information (in thousands) 2026 2025 Cash paid for operating lease liabilities $ 1,780 $ 1,393 Right-of-use assets obtained in exchange for operating lease obligations (1) $ 4,797 $ (1) For the six months ended June 30, 2026, right-of-use assets obtained in exchange for operating lease obligations is related to the commencement of the Companys lease agreement in India. The future maturities of operating lease liabilities are as follows: (in thousands) June 30, 2026 2026 (six months remaining) $ 1,920 2027 3,738 2028 3,945 2029 4,307 2030 4,458 Thereafter 9,017 Total minimum lease payments 27,385 Less: present value …

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Recent Accounting Pronouncements In September 2025, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2025-06, IntangiblesGoodwill and OtherInternal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software (ASU 2025-06). The amendments in the ASU are intended to simplify the capitalization guidance by removing all references to software development project stages so that guidance is neutral to different software development methods. ASU 2025-06 is effective for fiscal years beginning after December 15, 2027 and for interim periods within those annual reporting periods. Early adoption is permitted. The Company is currently evaluating the impact of the adoption on its Condensed Consolidated Financial Statements. In November 2024, the FASB issued ASU No. 2024-03, Income StatementReporting Comprehensive IncomeExpense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (ASU 2024-03). The amendments in the ASU require disclosures about specific types of expenses included in the expense captions presented on the Condensed Consolidated Statements of Operations, as well as disclosures about selling expenses. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, on a prospective basis. Early adoption is permitted. The Company is currently evaluating the impact of adopti …

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Revenues and Deferred Costs The following table disaggregates the Company's revenue by major source for the three and six months ended June 30, 2026 and 2025: Three months ended June 30, Six months ended June 30, (in thousands) 2026 2025 2026 2025 SaaS subscription services $ 122,975 $ 105,859 $ 243,753 $ 198,667 Implementation services 3,326 3,244 6,985 5,516 Other services 3,543 2,956 5,244 5,711 Total revenues $ 129,844 $ 112,059 $ 255,982 $ 209,894 The Company recognized approximately $23.0 million of revenue during the six months ended June 30, 2026 that was included in deferred revenues in the accompanying Unaudited Condensed Consolidated Balance Sheets as of the beginning of the reporting period. For those contracts that were wholly or partially unsatisfied as of June 30, 2026, the Companys remaining performance obligation totaled approximately $1.7 billion. The Company expects to recognize approximately 52.2% of these remaining obligations as revenue over the next 24 months, an additional 33.0% in the next 25 to 48 months, and the remaining balance thereafter. This estimate does not include estimated consideration for excess user and transaction processing fees that the Company expects to earn under its subscription contracts. Contract assets totaled $4.3 million and $3.6 million as of June 30, 2026 and December 31, 2025, respectively, which are included in other assets in the accompanying Unaudited Condensed Consolidated Balance Sheets. Deferred Cost Recognition The …

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Subsequent Event In July 2026, the Company repurchased an additional 531,620 shares of its common stock under its authorized stock repurchase program for an aggregate consideration of $10.0 million.

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