Financial Analysis

COMMITMENTS AND CONTINGENCIES Purchase Commitments The Companys purchase commitments as of June 30, 2026 are primarily related to agreements to purchase services in the ordinary course of business. As of June 30, 2026, the total minimum purchase obligations totaled $12.6 million. There have been no other material changes outside the normal course of business to the Companys non-cancellable purchases commitments. For additional information, please refer to Note 9 to the Companys Consolidated Financial Statements for the year ended December 31, 2025, included in Part II, Item 8 of the 2025 Form 10-K. Retirement Plan The Company has defined contribution plans for both its U.S. and foreign employees. For certain of these plans, employees may contribute up to the statutory maximum, which is set by law each year. The plans also provide for employer contributions. For the three months ended June 30, 2026 and 2025, the Companys matching contributions to these plans totaled $0.8 million and $0.8 million, respectively. For the six months ended June 30, 2026 and 2025, the Companys matching contributions to these plans totaled $1.7 million and $1.6 million, respectively. Oracle PeopleSoft Services Wind Down; July 2025 Rimini II Settlement Agreement with Oracle and Subsequent Stay of Rimini II Litigation Oracle PeopleSoft Services Wind Down In July 2024, the Company announced during its fiscal second quarter earnings call that it had unilaterally decided to wind down its offering of suppo …

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DEBT Debt is presented net of debt discounts and issuance costs in the Companys balance sheets and consisted of the following (in thousands): June 30, December 31, 2026 2025 Term Loan $ 46,575 $ 67,187 Less current maturities (4,031) Long-term debt, net of current maturities $ 46,575 $ 63,156 On March 27, 2026, the Company amended the Credit Facility, as originally executed, to implement certain changes to the aggregate amounts of permitted Restricted Payments (as such term is defined in the Credit Facility) such that (a) commencing with the Companys fiscal year ending on December 31, 2026 and for each fiscal year thereafter, the aggregate Restricted Payments shall not exceed $20.0 million per fiscal year and (b) in respect of Restricted Payments made on and after January 1, 2026, the aggregate Restricted Payments shall not exceed $50.0 million, in each case subject to the satisfaction of applicable conditions set forth in the Credit Facility Cash proceeds and payment activity relating to the Credit Facility consisted of the following (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Principal payments on revolving line of credit $ $ (5,000) $ $ (5,000) Principal payments on term loan (10,000) (937) (20,938) (1,875) Net cash activity relating to debt $ (10,000) $ (5,937) $ (20,938) $ (6,875) On June 25, 2026, March 30, 2026 and February 4, 2026, the Company made voluntary prepayments of $10.0 million, $5.0 million and $5.0 million, resp …

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COMMON STOCK OFFERING, RESTRICTED STOCK UNITS, STOCK OPTIONS AND WARRANTS Common Stock Repurchased During the three and six months ended June 30, 2026 and 2025, the Company did not acquire any shares of its Common Stock on the open market. On September 29, 2025, the Board of Directors authorized an extension to the Common Stock repurchase program to extend the termination date from June 1, 2026 to June 1, 2029, subject to compliance with the Companys Credit Facility, provided that all other applicable conditions and legal requirements are satisfied. The Board of Directors had previously authorized a Common Stock repurchase program of up to $50.0 million, of which $36.7 million still remains available as of June 30, 2026. Stock Plan The Companys stock plan consists of the 2013 Equity Incentive Plan, as amended and restated in July 2017 (the 2013 Plan). On February 12, 2026, pursuant to the evergreen provisions of the 2013 Plan, the Board of Directors authorized an increase of approximately 3.7 million shares available for grant under the 2013 Plan. On February 26, 2026, the Companys Board of Directors approved the Companys 2026 Long-Term Incentive Plan (the 2026 LTI Plan), consisting of awards of performance units (PSUs), restricted stock units (RSUs) and stock options to purchase shares of the Companys Common Stock under the terms of the Companys 2013 Plan, as amended, effective March 2, 2026. On March 4, 2025, the Companys Board of Directors approved the Companys 2025 Long-T …

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INCOME TAXES For the three months ended June 30, 2026 and 2025, the Companys effective tax rate was 51.6% and 25.8%, respectively. For the six months ended June 30, 2026 and 2025, the Companys effective tax rate was 48.3% and 30.6%, respectively. The Companys income tax expense was attributable to income before income taxes and foreign withholding taxes. The Company continues to explore opportunities to reduce withholding taxes such that its effective tax rate may decrease in future periods. After full utilization of net operating losses, the benefit of foreign tax and other credits would further reduce the Companys effective tax rate. The Company did not have any changes to its conclusions regarding valuation allowances for deferred income tax assets or uncertain tax positions for the three and six months ended June 30, 2026 and 2025. For additional information about income taxes, please refer to Note 8 to the Companys Consolidated Financial Statements for the year ended December 31, 2025, included in Part II, Item 8 of the 2025 Form 10-K. …

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LEASES The Company has operating leases for real estate and equipment with an option to renew the leases for up to one month to five years. Some of the leases include the option to terminate the leases upon a specified notice period with a penalty. The Companys leases have various remaining lease terms ranging from approximately seven months to approximately nine years. The components of lease expense and supplemental balance sheet information were as follows (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Operating lease expense related to ROU assets and liabilities $ 1,329 $ 1,230 $ 2,678 $ 2,421 Other lease expense 245 296 422 485 Total lease expense $ 1,574 $ 1,526 $ 3,100 $ 2,906 Other information related to leases was as follows (in thousands): Supplemental Balance Sheet Information June 30, 2026 December 31, 2025 Operating lease right-of-use assets, noncurrent $ 19,695 $ 21,371 June 30, 2026 December 31, 2025 Operating lease liabilities, current $ 4,355 $ 4,984 Operating lease liabilities, noncurrent 16,600 18,843 Total operating lease liabilities $ 20,955 $ 23,827 As of June 30, 2026, the Company has four additional operating leases with an aggregate net present value of $4.6 million that will commence between July 2026 and November 2026. Weighted Average Remaining Lease Term Years Operating leases 6.5 Weighted Average Discount Rate Operating leases 7.4 % Maturities of operating lease liabilities as of June 30, 2026 were as fo …

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"Recently Adopted Accounting Pronouncements The following accounting standards have been adopted during fiscal year 2026: In July 2025, the FASB issued ASU 2025-05, Financial InstrumentsCredit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets. ASU 2025-05 provides entities with a practical expedient to simplify the estimation of expected credit losses on current accounts receivable and current contract assets that arise from transactions accounted for under ASC 606, Revenue from Contracts with Customers by allowing the assumption that current conditions as of the balance sheet date will not change during the remaining life of the asset. ASU 2025-05 is effective for annual periods beginning after December 15, 2025 and interim reporting periods within those annual reporting periods, with early adoption permitted. The Company has adopted the practical expedient effective for fiscal year 2026 and the impact of this adoption did not have a significant impact on the Consolidated Financial Statements and related disclosures. Recent Accounting Pronouncements Not Yet Effective In November 2024, the FASB issued ASU 2024-03, ""Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses,"" and in January 2025, the FASB issued ASU 2025-01, ""Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying t …

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RELATED PARTY TRANSACTIONS An affiliate of Adams Street Partners and its affiliates (collectively referred to as ASP) is a member of the Companys Board of Directors. As of June 30, 2026, ASP owned approximately 25.2% of the Companys issued and outstanding shares of Common Stock. …

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DEFERRED CONTRACT COSTS AND DEFERRED REVENUE Activity for deferred contract costs consisted of the following (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Deferred contract costs, current and noncurrent, as of the beginning of period $ 41,657 $ 37,130 $ 42,170 $ 39,160 Capitalized commissions during the period 4,996 4,331 9,457 7,024 Amortized deferred contract costs during the period (5,010) (4,663) (9,984) (9,386) Deferred contract costs, current and noncurrent, as of the end of period $ 41,643 $ 36,798 $ 41,643 $ 36,798 Deferred revenue activity consisted of the following (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Deferred revenue, current and noncurrent, as of the beginning of period $ 277,329 $ 256,423 $ 287,541 $ 281,197 Billings, net 100,877 110,636 196,138 190,066 Revenue recognized (111,075) (104,114) (216,548) (208,318) Deferred revenue, current and noncurrent, as of the end of period $ 267,131 $ 262,945 $ 267,131 $ 262,945 The Company typically invoices its customers at the start of the support period, in annual and multi-year installments. When revenue recognized on a contract exceeds billings, the Company records a contract asset. As of June 30, 2026 and December 31, 2025, contract assets amounted to $0.5 million and $1.9 million, respectively, and are included in prepaid expenses and other on the condensed consolidated balance sheets. Deferred revenue is a contract liabili …

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SEGMENT AND GEOGRAPHIC INFORMATION Segment Information The Company operates as one operating segment. Operating segments are defined as components of an enterprise for which separate financial information is evaluated regularly by the chief operating decision maker (the CODM) in deciding how to allocate resources and assess performance. The CODM assesses the performance of the Company and decides how to allocate resources based on consolidated net income, which is identical to the information presented in the accompanying Unaudited Condensed Consolidated Statements of Operations and Comprehensive Income. The measure of segment assets is reported in the Unaudited Condensed Consolidated Balance Sheets as total assets. Additional information on segment information is included in Note 13 to the Companys Consolidated Financial Statements for the year ended December 31, 2025, included in Part II, Item 8 of the 2025 Form 10-K. The following table presents selected financial information with respect to the Companys single operating segment for the three and six months ended June 30, 2026 and 2025 (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Revenue $ 111,075 $ 104,114 $ 216,548 $ 208,318 Less: Cost of revenue, adjusted Employee compensation and benefits (a) 24,638 25,084 50,045 50,125 Engineering consulting costs 7,950 6,609 15,547 12,754 Administrative allocations 4,897 4,273 10,060 8,535 All other costs (b) 5,295 4,667 9,714 9,225 Total …

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"LIQUIDITY AND SIGNIFICANT ACCOUNTING POLICIES Liquidity As of June 30, 2026, the Companys current liabilities exceeded its current assets by $50.0 million, and the Company recorded net income of $2.4 million for the three months ended June 30, 2026. As of June 30, 2026, the Company had available cash and cash equivalents of $123.4 million. As of June 30, 2026, the Companys current liabilities included $243.1 million of deferred revenue whereby the costs of fulfilling the Companys commitments to provide services to its clients was approximately 39% of the related deferred revenue for the three months ended June 30, 2026. On April 30, 2024, the Company refinanced its $90 million five-year term loan into a new five-year term loan of $75 million (as amended by Amendment No. 1 thereto dated March 27, 2026, the Credit Facility). On June 25, 2026, March 30, 2026, and February 4, 2026, the Company made voluntary prepayments of $10.0 million, $5.0 million and $5.0 million, respectively, on the outstanding term loan principal balance under the Credit Facility. The Company also made its scheduled principal payment of $0.9 million on March 31, 2026. As a result, the Companys next scheduled principal payment is not due until April 30, 2029. See Note 5 for further information regarding the Companys Credit Facility, including the first amendment thereto dated March 27, 2026. Additionally, the Company is obligated to make operating lease payments that are due within the next 12 months in th …

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