Financial Analysis

"BUSINESS COMBINATIONS Datagrid On January 16, 2026, the Company completed the acquisition of all outstanding equity of Toric Labs, Inc. (d/b/a Datagrid) (Datagrid), a leader in agentic artificial intelligence (AI) solutions for the construction industry, to accelerate the Companys AI strategy and deliver advanced reasoning and data connectivity capabilities for its customers. The purchase consideration was $168.0 million in cash. The preliminary purchase consideration was allocated to the following assets and liabilities at the acquisition date (in thousands): Fair Value Useful Life Assets acquired Cash and cash equivalents $ 9,073 Accounts receivable 832 Prepaid expenses and other current assets 1,039 Developed technology intangible asset 50,500 7 years Customer relationships intangible asset 4,000 10 years Goodwill 114,926 Total assets acquired $ 180,370 Liabilities assumed Accounts payable $ (343) Accrued expenses (58) Deferred revenue, current (2,073) Other current liabilities (5,798) Net deferred tax liabilities (4,128) Total liabilities assumed $ (12,400) Net assets acquired $ 167,970 Developed technology intangible asset represents the fair value of Datagrids technology, which was valued considering the cost to rebuild method. Key assumptions under the cost to rebuild method include the estimated level of effort and related costs of reproducing or replacing the acquired technology. Developed technology is amortized on a straight-line basis, which approximates the patt …

BusinessCombinationDisclosureTextBlock · excerpt; the full note is in the filing

COMMITMENTS AND CONTINGENCIES Legal Matters The Company is, and may in the future become, involved in or subject to various legal proceedings arising in the ordinary course of business, including, among other things, related to commercial matters, business or employment practices, regulatory compliance, and legal proceedings with third parties asserting infringement of their intellectual property rights. The results of any current or future legal proceedings cannot be predicted with certainty, and regardless of the outcome, such proceedings can have an adverse impact on the Company because of defense and settlement costs, diversion of management resources, and other factors. The Company reviews at least quarterly the status of each legal proceeding and assesses its potential financial exposure in light of the impacts of negotiations, estimated settlements, legal rulings, advice of legal counsel, and other information and events pertaining to such matters. The Company accrues a liability related to a legal proceeding when it is considered both probable that a liability has been incurred and the amount of the loss is reasonably estimable. However, legal proceedings are inherently uncertain and as circumstances change, it is possible that the amount of any accrued liability may increase, decrease, or be eliminated. Trade Secret Litigation On October 25, 2024, Oracle America, Inc. and certain of its affiliates (Oracle) filed a lawsuit against the Company, one of its affiliates, a …

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"STOCKHOLDERS EQUITY 2021 Equity Incentive Plan In May 2021, the Companys board of directors (the Board) adopted, and the stockholders approved, the 2021 Equity Incentive Plan (the 2021 Plan) with the purpose of granting stock-based awards, including stock options, stock appreciation rights, restricted stock awards, RSUs, PSUs, and other forms of awards, to employees, directors, and consultants. As of December 31, 2025, a total of 59,355,916 shares of common stock were authorized for issuance under the 2021 Plan. The number of shares of the Companys common stock reserved for issuance under the 2021 Plan automatically increases on January 1 of each calendar year, starting on January 1, 2022 through January 1, 2031, in an amount equal to either (i) 5% of the total number of shares of the Companys common stock outstanding on December 31 of the fiscal year before the date of each automatic increase, or (ii) a lesser number of shares determined by the Board prior to the applicable January 1. Accordingly, on January 1, 2026, the number of shares of common stock that may be issued under the 2021 Plan increased by an additional 7,585,428 shares. As a result, as of June 30, 2026, a total of 66,941,344 shares of common stock are authorized for issuance under the 2021 Plan. As of June 30, 2026, a total of 43,123,751 shares of common stock were available for issuance under the 2021 Plan. No stock options have been issued under the 2021 Plan. Stock options No stock options were granted du …

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FAIR VALUE OF FINANCIAL INSTRUMENTS Financial assets measured at fair value on a recurring basis within the fair value hierarchy are summarized as follows (in thousands): June 30, 2026 Level 1 Level 2 Total Cash equivalents: Money market funds $ 407,589 $ $ 407,589 Marketable securities: U.S. treasury securities 76,718 76,718 Corporate notes and obligations 84,804 84,804 Total $ 484,307 $ 84,804 $ 569,111 December 31, 2025 Level 1 Level 2 Total Cash equivalents: Money market funds $ 403,979 $ $ 403,979 Marketable securities: U.S. treasury securities 132,036 132,036 Commercial paper 14,310 14,310 Corporate notes and obligations 183,985 183,985 Total $ 536,015 $ 198,295 $ 734,310 …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

INTANGIBLE ASSETS AND GOODWILL Intangible assets During the six months ended June 30, 2026, the Company completed the acquisition of Datagrid, which was accounted for as a business combination, as described above in Note 6. The Companys intangible assets are summarized as follows (in thousands): June 30, 2026 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Weighted-Average Remaining Useful Life (Years) Developed technology $ 262,961 $ (144,541) $ 118,420 4.7 Customer relationships 79,950 (57,436) 22,514 6.6 Total intangible assets $ 342,911 $ (201,977) $ 140,934 5.0 December 31, 2025 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Weighted-Average Remaining Useful Life (Years) Developed technology $ 212,463 $ (127,638) $ 84,825 3.8 Customer relationships 75,950 (55,411) 20,539 6.4 Total intangible assets $ 288,413 $ (183,049) $ 105,364 4.3 Certain of the Companys intangible assets related to the previous acquisitions were fully amortized in 2025. The Company estimates that there is no significant residual value related to its intangible assets. Amortization expense recorded on the Companys intangible assets is summarized as follows (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Cost of revenue $ 8,311 $ 8,015 $ 16,019 $ 15,617 Sales and marketing 905 3,346 2,026 6,651 Research and development 221 658 883 1,290 Total amortization of acquired intangible assets $ 9,437 $ 12,019 $ 18,928 $ 23,558 Goo …

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INCOME TAXES For the three months ended June 30, 2026 and 2025, the Company recorded an income tax (benefit) of $(1.8) million and $(0.4) million, respectively. For the six months ended June 30, 2026 and 2025, the Company recorded an income tax (benefit) provision of $(3.6) million and $4.9 million, respectively. As of June 30, 2026, the Company maintained a full valuation allowance on its U.S. federal and state net deferred tax assets as it was more likely than not that those deferred tax assets would not be realized. In determining quarterly provisions for income taxes, the Company uses the annual estimated effective tax rate applied to the actual year-to-date income or loss, adjusted for discrete items, if any, arising in that quarter. The Companys annual estimated effective tax rate differs from the U.S. federal statutory rate of 21% primarily as a result of state taxes, foreign taxes, and changes in the Companys valuation allowance. …

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LEASES The Company has primarily entered into lease arrangements for office space, in addition to other miscellaneous equipment. The Companys leases have initial non-cancelable lease terms ranging from one to 14 years. Some of the Companys leases include an option for it to extend the term of the lease for up to 5 years. During the six months ended June 30, 2026, the Company executed a strategic plan for its office leases in Carpinteria, California, altering its long-term renewal expectations. While the Company previously assumed it was reasonably certain to exercise two 5-year renewal options across all suites, management elected to exercise only one 5-year renewal for its primary core lease space and decline future renewal extensions for the remaining office suites. These actions shortened the remaining lease terms and triggered a reclassification of the arrangements from finance leases to operating leases. Consequently, future contractual rent commitments decreased by a net of $29.7 million. Total finance lease modifications during the period resulted in net decreases to right of use assetsfinance leases and corresponding finance lease liabilities of $18.8 million and $27.6 million, respectively, which primarily related to the modified leases in Carpinteria. Total operating lease modifications related to Carpinteria during the period resulted in net increases to right of use assetsoperating leases and corresponding operating lease liabilities of $0.9 million and $3.9 milli …

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Recently issued accounting pronouncements - not yet adopted Disaggregation of Income Statement Expenses In November 2024, the FASB issued ASU No. 2024-03, Income Statement Reporting Comprehensive Income Expense Disaggregation Disclosures (Subtopic 220-40) Disaggregation of Income Statement Expenses (ASU 2024-03). The new amendment expands financial reporting by requiring that public entities disclose additional information about certain expense categories in tabular form in the notes to financial statements at interim and annual reporting periods. ASU 2024-03 is effective for public business entities for fiscal years beginning after December 15, 2026 and for interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. Upon adoption, public entities should apply the amendment either (1) prospectively to financial statements issued for reporting periods after the effective date or (2) retrospectively to all periods presented in the financial statements. The Company is evaluating the impact of the adoption of ASU 2024-03 on its condensed consolidated financial statements and disclosures. Improvements to Accounting for Internal-Use Software In September 2025, the FASB issued ASU No. 2025-06, Intangibles Goodwill and Other Internal-Use Software (ASU 2025-06). The new amendment modernizes the accounting for software costs by changing the timing of when an entity is required to start capitalizing software projects and requiring entities to ev …

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RESTRUCTURING In January 2026, the Company executed a reduction of 4% of its global workforce as part of its ongoing evaluation of its operations to ensure alignment of its workforce with, and to enable greater investment in key growth opportunities. The reduction in force was completed as of March 31, 2026. The following table summarizes the severance and other benefit costs incurred during the six months ended June 30, 2026 by line item within the condensed consolidated statement of operations and comprehensive income (loss) (in thousands) related to this restructuring event: Cost of revenue $ 1,002 Sales and marketing 2,428 Research and development 1,893 General and administrative 638 Total restructuring-related costs $ 5,961 As of June 30, 2026 , there was no liability remaining for restructuring-related costs.

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GEOGRAPHIC INFORMATION The following table sets forth the Companys revenues by geographic region, which is determined based on the billing location of the customer (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Revenue by geographic region: U.S. $ 316,559 $ 276,144 $ 621,928 $ 540,741 Rest of the world 58,648 47,775 112,562 93,810 Total revenue $ 375,207 $ 323,919 $ 734,490 $ 634,551 Percentage of revenue by geographic region: U.S. 84 % 85 % 85 % 85 % Rest of the world 16 % 15 % 15 % 15 % …

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"SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of presentation The accompanying condensed consolidated financial statements include the interim financial statements of Procore. The condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (GAAP or U.S. GAAP) and are unaudited. Certain information and disclosures normally included in consolidated financial statements prepared in accordance with U.S. GAAP have been condensed or omitted. Accordingly, these condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes for the year ended December 31, 2025. The condensed consolidated balance sheet information as of December 31, 2025 has been derived from the Companys audited consolidated financial statements. The condensed consolidated financial statements have been prepared on a basis consistent with that used to prepare the audited annual consolidated financial statements and include, in the opinion of management, all adjustments, consisting of normal recurring items, necessary for the fair statement of the condensed consolidated financial statements. All intercompany balances and transactions have been eliminated in consolidation. Use of estimates The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the repor …

SignificantAccountingPoliciesTextBlock · excerpt; the full note is in the filing

UBSEQUENT EVENTS On July 27, 2026, the Company entered into an Agreement and Plan of Merger to acquire DroneDeploy, Inc., a Delaware corporation (DroneDeploy), for a purchase price of approximately $845.0 million in cash, subject to certain adjustments for working capital, transaction expenses, cash, and indebtedness, among other things, as described in the merger agreement. DroneDeploy is a software company that provides cloud-control software solutions for drones and other robots, which include automated flight safety checks, workflows, and real-time mapping and data processing. In addition to the purchase price, the Company has agreed to create a retention pool for the benefit of certain service providers of DroneDeploy consisting of equity awards, or cash where equity cannot be granted due to applicable law, to encourage such service providers to continue providing services to the Company or its affiliates following the closing of the merger. The completion of this transaction is anticipated to occur later this year and is subject to the satisfaction of certain closing conditions. As such, the Company is not able to disclose certain information relating to the business combination, including the preliminary fair value of assets acquired, liabilities assumed, and the final purchase price allocation. In connection with its entry into the merger agreement, on July 27, 2026, the Company entered into a debt financing commitment letter with Goldman Sachs Bank USA, pursuant to w …

SubsequentEventsTextBlock · excerpt; the full note is in the filing