Financial Analysis

"Acquisitions Asset Acquisition Security Savvy Ltd On September 15, 2025, the Company acquired certain assets of Security Savvy Ltd, a third-party security platform that helps organizations manage identity-related risks associated with their software as a service (""SaaS"") applications, for $18.4 million, which included $0.5 million in direct transaction costs that were capitalized as a component of the consideration transferred. The transaction was accounted for as an asset acquisition and substantially all of the acquired assets consisted of developed technology. The purchase price includes a holdback amount of $1.8 million to be paid 12 months from the date of closing subject to the resolution of certain indemnities. The purchase price also includes a contingent consideration of $0.2 million, which was paid and fully settled on November 21, 2025. The purchase price consideration was primarily allocated to a developed technology intangible asset with a useful life of six years. Business Combinations Entro On June 29, 2026, the Company completed the acquisition of 100% of the outstanding equity interests of Entro Security Ltd. and its wholly owned subsidiary, Entro Security Inc. (collectively, ""Entro""), for total purchase consideration of approximately $122.6 million in cash. In connection with the acquisition, the Company committed to issue up to $7.3 million in restricted stock to certain key employees and former shareholders of Entro who became employees. Because the i …

BusinessCombinationDisclosureTextBlock · excerpt; the full note is in the filing

Commitments and Contingencies Contractual Purchase Commitments The Company has contractual commitments associated with agreements that are enforceable and legally binding. These contractual commitments do not include obligations under contracts that the Company can cancel without significant penalty or purchase orders as the purchase orders represent authorizations to purchase rather than binding agreements. On February 1, 2026, the Company entered into a new amendment with its cloud storage provider, terminating the previous arrangement. The new agreement, effective February 1, 2026 through January 31, 2031, requires the Company to commit to minimum annual purchases of $107.0 million, $127.0 million, $147.0 million, $162.0 million, and $178.0 million in contract years one through five, respectively, for a total commitment of $721.0 million. If the Company does not meet the minimum purchase obligation during any contract year, it will be required to pay the difference. There have been no further amendments or material developments related to this agreement since its execution. During the six months ended July 31, 2026, there were no other material changes outside the ordinary course of business to the Companys non-cancelable contractual commitments previously disclosed in the fiscal 2026 Form 10-K. Indemnification Arrangements In the ordinary course of business, the Company enters into contractual arrangements under which it agrees to provide indemnification of varying scope …

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"Credit Agreement and Debt 2025 Credit Agreement On June 25, 2025, the Company entered into a credit agreement (the ""2025 Credit Agreement"") that provides for a five -year $250.0 million secured revolving credit facility, including a letter of credit sub-facility of up to $10.0 million (the ""2025 Revolving Credit Facility""). The 2025 Revolving Credit Facility matures on June 25, 2030. The Company incurred deferred financing costs of $2.7 million related to the entry into the 2025 Credit Agreement, which are included in other non-current assets on the accompanying condensed consolidated balance sheets. These costs are being amortized to interest expense over the life of the 2025 Credit Agreement on a straight-line basis. Amortization of deferred financing costs related to the 2025 Credit Agreement was $0.1 million and $0.3 million for the three and six months ended July 31, 2026, respectively. Amortization of deferred financing costs related to the 2025 Credit Agreement was $0.1 million for both the three and six months ended July 31, 2025. The Company is subject to customary letter of credit fees, including a fronting fee equal to 0.125% per annum of the daily maximum amount then available to be drawn under such letters of credit, as well as customary issuance and administration fees. These fees were $0.1 million and $0.3 million for the three and six months ended July 31, 2026, respectively, and are recorded as interest expense on the condensed consolidated statements of …

DebtDisclosureTextBlock · excerpt; the full note is in the filing

The following table presents the Companys revenue disaggregated by subscription product categories (in thousands): Three Months Ended July 31, Six Months Ended July 31, 2026 2025 2026 2025 Subscription SaaS $ 193,872 $ 144,758 $ 372,351 $ 276,573 Maintenance and support 35,468 38,471 70,031 75,860 Term subscriptions 56,196 58,120 100,112 98,160 Other subscription services 9,669 6,588 18,532 12,667 Total Subscription 295,205 247,937 561,026 463,260 Services and other 13,608 16,422 27,929 31,567 Total revenue $ 308,813 $ 264,359 $ 588,955 $ 494,827 The following table summarizes the revenue the Company recognizes at a point in time and over time (in thousands): Three Months Ended July 31, Six Months Ended July 31, 2026 2025 2026 2025 Revenue recognized over time $ 273,141 $ 223,165 $ 528,650 $ 428,014 Revenue recognized at a point in time 35,672 41,194 60,305 66,813 Total revenue $ 308,813 $ 264,359 $ 588,955 $ 494,827 …

DisaggregationOfRevenueTableTextBlock · excerpt; the full note is in the filing

"Equity-Based Compensation Omnibus Incentive Plan and Other Awards On February 12, 2025, the shareholders and the Company's Board of Directors (the ""Board"") approved the SailPoint, Inc. Omnibus Incentive Plan (the ""Omnibus Plan""), which then became effective. The aggregate number of shares of common stock that may be issued pursuant to the Omnibus Plan is 61,083,763, subject to an annual increase on February 1 of each fiscal year, equal to the lesser of (a) 5% of the aggregate number of shares of common stock outstanding on January 31 of the immediately preceding fiscal year and (b) such smaller number of shares as determined by the Board. Pursuant to the ""evergreen"" provision contained in the Omnibus Plan, the Board approved an increase of 28,189,081 additional shares to be added to the plan effective as of February 1, 2026. As of July 31, 2026 , the maximum number of shares authorized under the Omnibus Plan was 89,272,844 and the number of shares available for issuance was 44,924,448. Under the Omnibus Plan, the Company may grant stock options, stock appreciation rights, restricted stock awards (""RSAs""), restricted stock units (""RSUs""), stock awards, dividend equivalents, other stock-based awards, cash awards, and substitute awards intended to align the interests of award holders with those of the Company's stockholders. Awards made under the Omnibus Plan vest based on continued service to the Company and/or its affiliates. Equity-based compensation costs for gran …

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Fair Value Measurements Assets and Liabilities Measured at Fair Value on a Recurring Basis Assets and liabilities recorded at fair value in the financial statements are categorized based upon the level of judgment associated with the inputs used to measure their fair value. Hierarchical levels which are directly related to the amount of subjectivity associated with the inputs to the valuation of these assets or liabilities are as follows: Level 1: Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2: Observable inputs, other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3: Unobservable inputs reflecting the Companys own assumptions incorporated in valuation techniques used to determine fair value. These assumptions are required to be consistent with market participant assumptions that are reasonably available. The following tables present information about the Companys financial assets that are measured at fair value on a recurring basis (in thousands): July 31, 2026 Level 1 Level 2 Level 3 Total Assets: Cash equivalents and restricted cash: Money market funds $ 54,844 $ $ $ 54,844 Certificate of deposit 75,000 75,000 Total assets $ 129,844 $ $ $ 129,844 January 31, 2026 Level 1 Leve …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

Income Taxes The provision for income taxes consists of U.S. and state income taxes and income taxes in foreign jurisdictions in which the Company conducts business. The effective tax rate for the three months ended July 31, 2026 and 2025 was 11.9% and 74.8% , respectively. The effective tax rate for the six months ended July 31, 2026 and 2025 was 8.9% and 19.6% , respectively. For the three and six months ended July 31, 2026, the effective tax rate differs from the statutory rate primarily as a result of certain non-deductible equity-based compensation, non-deductible executive officer compensation, and an increase in valuation allowance. For the three and six months ended July 31, 2025, the effective tax rate differs from the statutory rate primarily as a result of a net discrete tax benefit for the change in valuation allowance for interest expense and Texas research and development credit carryforwards from changes in tax law.

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"Recently Adopted Accounting Pronouncements Accounting Standards Update 2025-05 In July 2025, the Financial Accounting Standards Board (the ""FASB"") issued ASU-2025-05, Financial Instruments Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets (ASU 2025-05), which amends Topic 326 to provide a practical expedient and an accounting policy election related to the estimation of expected credit losses for current accounts receivable and current contract assets that arise from transactions accounted for under Accounting Standards Codification (ASC) 606. Specifically, in developing reasonable and supportable forecasts as part of estimating expected credit losses, all entities may elect a practical expedient that assumes that current conditions as of the balance sheet date do not change for the remaining life of the asset. ASU 2025-05 is effective for annual reporting periods beginning after December 15, 2025, and interim reporting periods within those annual reporting periods, with early adoption permitted. Entities should apply the new guidance prospectively. The Company adopted this standard prospectively and it did not have a material impact on its consolidated financial statements or disclosures. Recently Issued Accounting Standards Not Yet Adopted Accounting Standards Update 2025-06 In September 2025, the FASB issued ASU-2025-06, IntangiblesGoodwill and OtherInternal-Use Software (Subtopic 350-40): Targeted Improvements to the Ac …

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Related Party Transactions The Company is an affiliate of Thoma Bravo. The Company engaged in ordinary sales transactions with entities affiliated with Thoma Bravo, with no significant activity for the three months ended July 31, 2026 and $0.1 million for the three months ended July 31, 2025, and $0.8 million for each of the six months ended July 31, 2026 and 2025. The Company engaged in ordinary purchase transactions with entities affiliated with Thoma Bravo of $0.2 million and $0.9 million for the three months ended July 31, 2026 and 2025, respectively, and $1.5 million and $2.2 million for the six months ended July 31, 2026 and 2025, respectively.

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Revenue Recognition Disaggregation of Revenue The following table presents the Companys revenue disaggregated by subscription product categories (in thousands): Three Months Ended July 31, Six Months Ended July 31, 2026 2025 2026 2025 Subscription SaaS $ 193,872 $ 144,758 $ 372,351 $ 276,573 Maintenance and support 35,468 38,471 70,031 75,860 Term subscriptions 56,196 58,120 100,112 98,160 Other subscription services 9,669 6,588 18,532 12,667 Total Subscription 295,205 247,937 561,026 463,260 Services and other 13,608 16,422 27,929 31,567 Total revenue $ 308,813 $ 264,359 $ 588,955 $ 494,827 The following table summarizes the revenue the Company recognizes at a point in time and over time (in thousands): Three Months Ended July 31, Six Months Ended July 31, 2026 2025 2026 2025 Revenue recognized over time $ 273,141 $ 223,165 $ 528,650 $ 428,014 Revenue recognized at a point in time 35,672 41,194 60,305 66,813 Total revenue $ 308,813 $ 264,359 $ 588,955 $ 494,827 Contract Balances Deferred revenue consists primarily of payments received in advance of revenue recognition under the Companys contracts with customers. Revenue recognized during the three months ended July 31, 2026 and 2025 that was included in the deferred revenue balances at the beginning of the respective periods was $212.3 million and $174.5 million, respectively. Revenue recognized during the six months ended July 31, 2026 and 2025 that was included in the deferred revenue balances at the beginning of the respe …

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"Segments and Geographic Information Operating segments are defined as components of an entity for which separate financial information is available and that is regularly reviewed by the Chief Operating Decision Maker (the ""CODM""). The CODM is comprised of the Company's Chief Executive Officer, Chief Financial Officer and President. The Company's CODM reviews financial information presented on a consolidated basis for the purposes of making operating decisions, allocating resources, and evaluating financial performance. Accordingly, the Company determined that it operates in one reportable segment. The CODM utilizes GAAP and non-GAAP measures of profit and loss for evaluating the Company's overall performance and informing resource allocation to support strategic priorities. The GAAP measure of profit and loss used by the CODM for such purposes is net loss. Significant expense categories regularly provided to the CODM are those disclosed in the condensed consolidated financial statements and related notes. The following is a summary of consolidated revenues within geographic areas determined by the billing address of the customer for the periods presented (in thousands): Three Months Ended July 31, Six Months Ended July 31, 2026 2025 2026 2025 United States $ 205,112 $ 170,356 $ 383,902 $ 321,533 EMEA 62,509 58,618 123,919 106,575 Rest of the World 41,192 35,385 81,134 66,719 Total revenue $ 308,813 $ 264,359 $ 588,955 $ 494,827 No single country other than the United State …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing