JFrog Ltd

Previous wording

We generate revenue from the sale of subscriptions to customers. We offer subscription tiers for self-managed deployments, where our customers deploy and manage our products across their public cloud, on-premise, private cloud, or hybrid environments, as well as JFrog-managed public cloud deployments, which we refer to as our SaaS subscriptions. Revenue from SaaS subscriptions contributed 43% of our total revenue for the three months ended March 31, 2025, compared to 37% for the three months ended March 31, 2024.

Current wording

We generate revenue from the sale of subscriptions to customers. We offer subscription tiers for self-managed deployments, where our customers deploy and manage our products across their public cloud, on-premise, private cloud, or hybrid environments, as well as JFrog-managed public cloud deployments, which we refer to as our SaaS subscriptions. Revenue from SaaS subscriptions contributed 45% and 44% of our total revenue for the three and six months ended June 30, 2025, respectively, compared to 38% and 37% for the corresponding periods in 2024, respectively.

Previous wording

Our self-managed subscriptions are offered on an annual and multi-year basis, and our SaaS subscriptions are offered on a monthly, annual, and multi-year basis. Revenue from Enterprise Plus subscription represented approximately 55% of our total revenue for the three months ended March 31, 2025, compared to approximately 49% for the three months ended March 31, 2024. The growth in revenue from our Enterprise Plus subscription demonstrates the increased demand for our end-to-end solutions for customers’ entire software supply chain management.

Current wording

Our self-managed subscriptions are offered on an annual and multi-year basis, and our SaaS subscriptions are offered on a monthly, annual, and multi-year basis. Revenue from Enterprise Plus subscription represented approximately 55% of our total revenue for the three and six months ended June 30, 2025, compared to approximately 50% and 49% for the corresponding periods in 2024, respectively. The growth in revenue from our Enterprise Plus subscription demonstrates the increased demand for our end-to-end solutions for customers’ entire software supply chain management.

Previous wording

We generated revenue of $122.4 million and $100.3 million for the three months ended March 31, 2025 and 2024, respectively, representing 22% growth. We have continued to invest in our business and had a net loss of $18.5 million and $8.8 million for the three months ended March 31, 2025 and 2024, respectively.

Current wording

We generated revenue of $127.2 million and $103.0 million for the three months ended June 30, 2025 and 2024, respectively, representing 23% growth, and $249.6 million and $203.4 million for the six months ended June 30, 2025 and 2024, respectively, representing 23% growth. We have continued to invest in our business and had a net loss of $21.7 million and $14.3 million for the three months ended June 30, 2025 and 2024, respectively, and $40.2 million and $23.1 million for the six months ended June 30, 2025 and 2024, respectively.

Previous wording

On October 7, 2023, Hamas militants and members of other terrorist organizations infiltrated Israel’s southern border from the Gaza Strip and conducted a series of terror attacks on civilian and military targets. Following the attack, Israel’s security cabinet declared war against Hamas and commenced a military campaign against these terrorist organizations. Since the commencement of these events, there have been additional active hostilities with other parties in the region. Although certain ceasefire agreements have been reached, these agreements have failed to be upheld, and military activity and hostilities continue to exist at varying levels of intensity. The situation remains volatile, with the potential for escalation into a broader regional conflict involving additional terrorist organizations and possibly other countries (including Hezbollah and Lebanon). Also, the current political situation in Syria may create further geopolitical instability in the region.

Current wording

On October 7, 2023, Hamas militants and members of other terrorist organizations infiltrated Israel’s southern border from the Gaza Strip and conducted a series of terror attacks on civilian and military targets. Following the attack, Israel’s security cabinet declared war against Hamas and commenced a military campaign against these terrorist organizations. Since the commencement of these events, there have been additional active hostilities with other parties in the region, including escalating tensions and direct confrontations between Israel and Iran and its proxies. Although certain ceasefire agreements have been reached, these agreements have failed to be upheld, and military activity and hostilities continue to exist at varying levels of intensity. The situation remains volatile, with the potential for escalation into a broader regional conflict involving additional terrorist organizations and possibly other countries (including Hezbollah and Lebanon). Additionally, the current political situation in Syria may create further geopolitical instability in the region.

Previous wording

Although we are domiciled in Israel, we are a global, cloud-based company, with operations spanning numerous countries with redundant infrastructure and code located outside of Israel. We have activated and maintained a comprehensive three-pillar business continuity plan and have taken the necessary steps which we believe are in line with such plan, in an effort to ensure that our operations and service to our customers remain consistent. The first pillar is our internal plan focused on the safety of our employees in Israel and maintaining internal communication channels. The second pillar revolves around technology to support continuity of our services, security, cyber defense, and research and development. The third pillar is dedicated to our external-facing activities to promote continuity of customer engagements, support and external communication. While certain of our employees and consultants have been called into military service, there has been no major interruption or material adverse impact on our operating results as of the date of this Quarterly Report on Form 10-Q. We will continue to monitor the situation as it progresses.

Current wording

Although we are domiciled in Israel, we are a global, cloud-based company with operations spanning numerous countries and redundant infrastructure and code located outside of Israel. We have activated and maintained a comprehensive three-pillar business continuity plan and have taken the necessary steps, which we believe are in line with such plan, in an effort to ensure that our operations and service to our customers remain consistent. The first pillar is our internal plan focused on the safety of our employees in Israel and maintaining internal communication channels. The second pillar revolves around technology to support the continuity of our services, security, cyber defense, and research and development. The third pillar is dedicated to our external-facing activities to promote the continuity of customer engagements, support, and external communication. While certain of our employees and consultants have been called into military service, there has been no major interruption or material adverse impact on our operating results as of the date of this Quarterly Report on Form 10-Q. We will continue to monitor the situation as it progresses.

Previous wording

We quantify our expansion across existing customers through our net dollar retention rate. Our net dollar retention rate compares our annual recurring revenue (“ARR”) from the same set of customers across comparable periods. We define ARR as the annualized revenue run-rate of subscription agreements from all customers as of the last month of the quarter. The ARR includes monthly subscription customers so long as we generate revenue from these customers. We annualize our monthly subscriptions by taking the revenue we would contractually expect to receive from such customers in a given month and multiplying it by 12. We calculate net dollar retention rate by first identifying customers (the “Base Customers”), which were customers in the last month of a particular quarter (the “Base Quarter”). We then calculate the contracted ARR from these Base Customers in the last month of the same quarter of the subsequent year (the “Comparison Quarter”). This calculation captures upsells, contraction, and attrition since the Base Quarter. We then divide total Comparison Quarter ARR by total Base Quarter ARR for Base Customers. Our net dollar retention rate in a particular quarter is obtained by averaging the result from that particular quarter with the corresponding results from each of the prior three quarters. Our net dollar retention rate may fluctuate as a result of a number of factors, including the level of penetration within our customer base, expansion of products and features, and our ability to retain our customers. As of March 31, 2025 and 2024, our net dollar retention rate was 116% and 118%, respectively. We expect our net dollar retention rate to remain relatively stable, with minor fluctuations around current levels.

Current wording

We quantify our expansion across existing customers through our net dollar retention rate. Our net dollar retention rate compares our annual recurring revenue (“ARR”) from the same set of customers across comparable periods. We define ARR as the annualized revenue run-rate of subscription agreements from all customers as of the last month of the quarter. The ARR includes monthly subscription customers so long as we generate revenue from these customers. We annualize our monthly subscriptions by taking the revenue we would contractually expect to receive from such customers in a given month and multiplying it by 12. We calculate net dollar retention rate by first identifying customers (the “Base Customers”), which were customers in the last month of a particular quarter (the “Base Quarter”). We then calculate the contracted ARR from these Base Customers in the last month of the same quarter of the subsequent year (the “Comparison Quarter”). This calculation captures upsells, contraction, and attrition since the Base Quarter. We then divide total Comparison Quarter ARR by total Base Quarter ARR for Base Customers. Our net dollar retention rate in a particular quarter is obtained by averaging the result from that particular quarter with the corresponding results from each of the prior three quarters. Our net dollar retention rate may fluctuate as a result of a number of factors, including the level of penetration within our customer base, expansion of products and features, and our ability to retain our customers. As of June 30, 2025 and 2024, our net dollar retention rate was 118%. We expect our net dollar retention rate to remain relatively stable, with minor fluctuations around current levels.

Previous wording

We focus on growing the number of large customers as a measure of our ability to scale with our customers and attract larger organizations to adopt our products. As of March 31, 2025, 1,051 of our customers had ARR of $100,000 or more, increasing from 1,018 customers as of December 31, 2024. We had 54 customers with ARR of at least $1.0 million as of March 31, 2025, increasing from 52 customers as of December 31, 2024.

Current wording

We focus on growing the number of large customers as a measure of our ability to scale with our customers and attract larger organizations to adopt our products. As of June 30, 2025, 1,076 of our customers had ARR of $100,000 or more, increasing from

Previous wording

Income tax expense (benefit) consists primarily of income taxes related to the U.S. and other foreign jurisdictions in which we conduct business. We maintain a full valuation allowance on deferred tax assets in Israel as we have concluded that it is not more likely than not that the deferred tax assets will be realized. Our effective tax rate is affected by tax rates in foreign jurisdictions and the relative amounts of income we earn in those jurisdictions, non-deductible expenses, excess tax benefits from share-based compensation awards, and changes in our valuation allowance.

Current wording

Income tax expense consists primarily of income taxes related to the United States and other foreign jurisdictions in which we conduct business. We maintain a full valuation allowance on deferred tax assets in Israel as we have concluded that it is not more likely than not that the deferred tax assets will be realized. Our effective tax rate is affected by tax rates in foreign jurisdictions and the relative amounts of income we earn in those jurisdictions, non-deductible expenses, excess tax benefits from share-based compensation awards, and changes in our valuation allowance.

Previous wording

The increase in total subscription revenue for the three months ended March 31, 2025, compared to the three months ended March 31, 2024, consisted of approximately $18.8 million growth from existing customers and the remaining attributable to new customers.

Current wording

The increase in total subscription revenue for the three months ended June 30, 2025 compared to the three months ended June 30, 2024 consisted of approximately $20.8 million in growth from existing customers and the remaining attributable to new customers.

Previous wording

Total cost of revenue increased for the three months ended March 31, 2025 compared to the three months ended March 31, 2024. The increase was primarily attributable to an increase of $3.8 million in third-party hosting costs mainly driven by increased revenue from SaaS subscriptions, an increase of $2.1 million in intangible amortization mainly as a result of our acquisition in July 2024, an increase of $1.6 million in personnel-related expenses mainly as a result of increased headcount, and an increase of $1.1 million in share-based compensation expense as discussed in the section titled “Share-Based Compensation Expense” below.

Current wording

Total cost of revenue increased for the three months ended June 30, 2025 compared to the three months ended June 30, 2024. The increase was primarily attributable to an increase of $2.9 million in third-party hosting costs mainly driven by increased revenue from SaaS subscriptions, an increase of $2.0 million in intangible amortization mainly as a result of our acquisition in July 2024, an increase of $1.7 million in personnel-related expenses mainly as a result of increased headcount, and an increase of $1.0 million in share-based compensation expense as discussed in the section titled “Share-Based Compensation Expense” below.

Previous wording

The decrease in gross margin for three months ended March 31, 2025, compared to the three months ended March 31, 2024, was primarily due to a continuous shift in our revenue mix towards SaaS subscriptions, which incur higher hosting costs, and intangible amortization as discussed above.

Current wording

Gross margin decreased for the three months ended June 30, 2025 compared to the three months ended June 30, 2024, primarily due to a continuous shift in our revenue mix towards SaaS subscriptions, which incur higher hosting costs, and intangible amortization as discussed above.

Previous wording

Research and development expense increased for the three months ended March 31, 2025 compared to the three months ended March 31, 2024. The increase was primarily attributable to an increase of $4.3 million in share-based compensation expense and an increase of $2.1 million in personnel-related expenses mainly as a result of increased headcount.

Current wording

Research and development expense increased for the three months ended June 30, 2025 compared to the three months ended June 30, 2024. The increase was primarily attributable to an increase of $4.5 million in personnel-related expenses mainly as a result of increased headcount and an increase of $4.0 million in share-based compensation expense.

Previous wording

Sales and marketing expense increased for the three months ended March 31, 2025 compared to the three months ended March 31, 2024. The increase was primarily attributable to an increase of $2.9 million in share-based compensation expense, an increase of $1.9 million in personnel-related expenses mainly as a result of increased headcount, an increase of $1.8 million in commissions, and an increase of $1.6 million in allocated overhead costs.

Current wording

Sales and marketing expense increased for the three months ended June 30, 2025 compared to the three months ended June 30, 2024. The increase was primarily attributable to an increase of $2.9 million in share-based compensation expense, an increase of $2.4 million in personnel-related expenses mainly as a result of increased headcount, an increase of $1.6 million in commission expense, and an increase of $1.5 million in allocated overhead costs.

Previous wording

General and administrative expense increased for the three months ended March 31, 2025 compared to the three months ended March 31, 2024. The increase was primarily attributable to an increase of $1.2 million in share-based compensation expense and an increase of $0.8 million in personnel-related expenses mainly as a result of increased headcount.

Current wording

General and administrative expense increased for the three months ended June 30, 2025 compared to the three months ended June 30, 2024. The increase was primarily attributable to an increase of $1.5 million in share-based compensation expense and an increase of $1.1 million in personnel-related expenses mainly as a result of increased headcount

Previous wording

Share-based compensation expenses increased for the three months ended March 31, 2025 compared to the three months ended March 31, 2024, primarily attributable to grants to new and existing employees. Additionally, during the three months ended March 31, 2025, we recognized $2.6 million in share-based compensation expense primarily in research and development, related to acquisition holdback ordinary shares and replacement RSUs.

Current wording

Share-based compensation expenses increased for the three months ended June 30, 2025 compared to the three months ended June 30, 2024, primarily attributable to grants to new and existing employees. Additionally, during the three months ended June 30, 2025, we recognized $2.7 million in share-based compensation expense mostly in research and development, related to acquisition holdback ordinary shares and replacement RSUs.

Previous wording

Interest and other income, net decreased for the three months ended March 31, 2025 compared to the three months ended March 31, 2024, primarily due to lower interest income on deposits and marketable investments as a result of lower interest rates.

Current wording

Interest and other income, net decreased for the three months ended June 30, 2025 compared to the three months ended June 30, 2024, primarily due to lower interest income on deposits and marketable securities as a result of lower interest rates.

Previous wording

As of March 31, 2025, our principal sources of liquidity were cash, cash equivalents, and short-term investments of $563.5 million. Cash and cash equivalents primarily consist of cash in banks and money market funds. Short-term investments generally consist of bank deposits, certificates of deposit, commercial paper, corporate debt securities, municipal securities, and government and agency debt. We believe our existing cash, cash equivalents, and short-term investments, together with cash provided by operations, will be sufficient to meet our needs for the next 12 months, as well as in the long-term.

Current wording

As of June 30, 2025, our principal sources of liquidity were cash, cash equivalents, and short-term investments of $611.7 million. Cash and cash equivalents primarily consist of cash in banks and money market funds. Short-term investments generally consist of bank deposits, certificates of deposit, commercial paper, corporate debt securities, municipal securities, and government and agency debt. We believe our existing cash, cash equivalents, and short-term investments, together with cash provided by operations, will be sufficient to meet our needs for the next 12 months, as well as in the long-term.

Previous wording

Net cash provided by operating activities of $17.5 million for three months ended March 31, 2024 was related to our net loss of $8.8 million, adjusted for non-cash charges of $31.4 million, including share-based compensation expense of $27.3 million, and net cash outflows of $5.2 million from changes in our operating assets and liabilities. Changes in our operating assets and liabilities consisted primarily of an increase of $4.0 million in prepaid expenses and other assets due to timing of payments, a decrease of $3.2 million in accrued expense and other liabilities mainly due to reduction of ESPP withholdings as a result of purchases of shares, a decrease of $2.9 million in deferred revenue due to higher recognition of revenue relative to billings, a decrease of $2.5 million in accounts payable due to timing of payments, and a decrease of $2.1 million in operating lease liabilities as a result of lease payments. The outflows were partially offset by a decrease of $9.8 million in accounts receivable due to timing of billing and collections.

Current wording

Net cash provided by operating activities of $64.9 million for the six months ended June 30, 2025 was related to our net loss of $40.2 million adjusted for non-cash charges of $89.0 million, including share-based compensation expense of $74.9 million and depreciation and amortization expense of $13.3 million, and changes in our operating assets and liabilities of $16.0 million. Changes in our operating assets and liabilities were primarily related to an increase of $9.5 million in accrued expense and other liabilities mainly due to accrued compensation and benefits and accrued acquisition-related compensation, a decrease of $7.7 million in accounts receivable due to timing of collection, and an increase of $7.6 million in deferred revenue. The inflows were partially offset by a decrease of $4.3 million in operating lease liabilities as a result of payments, and an increase of $3.1 million in deferred contract acquisition costs. The increases in deferred revenue and deferred contract acquisition costs were driven by higher sales.

Previous wording

Net cash provided by operating activities of $28.8 million for three months ended March 31, 2025 was related to our net loss of $18.5 million, adjusted for non-cash charges of $44.0 million, including share-based compensation expense of $36.8 million and depreciation and amortization of $6.7 million, and changes in our operating assets and liabilities of $3.3 million. Changes in our operating assets and liabilities consisted primarily of a decrease of $6.5 million in accounts receivable due to timing of billing and collections, partially offset by a decrease of $2.2 million in operating lease liabilities as a result of lease payments.

Current wording

Net cash provided by operating activities of $34.2 million for the six months ended June 30, 2024 was related to our net loss of $23.1 million adjusted for non-cash charges of $64.4 million, including share-based compensation expense of $55.9 million and depreciation and amortization expense of $7.6 million, and net cash outflow of $7.1 million from changes in our operating assets and liabilities. The changes in our operating assets and liabilities were primarily related to an increase of $5.6 million in accounts receivable, an increase of $5.0 million in prepaid expense and other assets due to timing of payments, and a decrease of $4.2 million in operating lease liabilities as a result of payments. The outflows were partially offset by an increase of $7.2 million in deferred revenue. The increases in accounts receivable and deferred revenue were driven by higher sales.

Previous wording

Net cash used in investing activities of $45.8 million for the three months ended March 31, 2025 consisted primarily of net purchases of short-term investments of $45.1 million.

Current wording

Net cash used in investing activities of $85.3 million for the six months ended June 30, 2025 consisted primarily of net purchases of short-term investments of $84.1 million.

Previous wording

Net cash provided by financing activities of $11.5 million for the three months ended March 31, 2025 consisted of proceeds from employee share purchases under our ESPP of $6.3 million, proceeds from exercise of share options of $3.8 million, and net proceeds of $1.5 million from our employee equity transactions to be remitted to tax authorities.

Current wording

Net cash provided by financing activities of $21.1 million for the six months ended June 30, 2025 consisted of net proceeds from employee equity transactions to be remitted to tax authorities of $7.9 million, proceeds from exercise of share options of $6.9 million, and proceeds from employee share purchases under our ESPP of $6.3 million.

Previous wording

Net cash provided by financing activities of $16.6 million for the three months ended March 31, 2024 consisted of proceeds from exercise of share options of $6.8 million, net proceeds of $5.3 million from our employee equity transactions to be remitted to tax authorities, and proceeds from employee share purchases under our ESPP of $4.5 million.

Current wording

Net cash provided by financing activities of $11.9 million for the six months ended June 30, 2024 consisted primarily of proceeds from exercise of share options of $7.7 million and proceeds from employee share purchases under our ESPP of $4.5 million.

Previous wording

Our critical accounting policies and estimates were disclosed in Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report. There have been no significant changes to these policies and estimates during the three months ended March 31, 2025.

Current wording

Our critical accounting policies and estimates were disclosed in Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report. There have been no significant changes to these policies and estimates during the six months ended June 30, 2025.