Definitive Healthcare Corp.

Previous wording

During the first quarter of 2025, we experienced declines in our market capitalization as a result of sustained decreases in our stock price, which represented a triggering event requiring our management to perform a quantitative goodwill impairment test as of the end of the first quarter of 2025. As a result of the impairment test, we determined that the fair value of our single reporting unit was lower than its carrying value and, accordingly, recorded a non-cash, pre-tax, goodwill impairment charge of $176.5 million during the first quarter of 2025. The goodwill impairment charge did not affect our liquidity or the financial covenants in our outstanding debt agreement. There were no triggering events identified during the second quarter of 2025 that would have required our management to perform a goodwill impairment test.

Current wording

During the first quarter of 2025, we experienced declines in our market capitalization as a result of sustained decreases in our stock price, which represented a triggering event requiring our management to perform a quantitative goodwill impairment test as of the end of the first quarter of 2025. As a result of the impairment test, we determined that the fair value of our single reporting unit was lower than its carrying value and, accordingly, recorded a non-cash, pre-tax, goodwill impairment charge of $176.5 million during the first quarter of 2025. The goodwill impairment charge did not affect our liquidity or the financial covenants in our outstanding debt agreement. There were no triggering events identified during the third quarter of 2025 that would have required our management to perform a goodwill impairment test.

Previous wording

During the first quarter of 2024, we committed to a restructuring plan intended to reduce operating costs, improve operating margins, and continue advancing our ongoing commitment to profitable growth (the “2024 Restructuring Plan”). The 2024 Restructuring Plan provided for a reduction of the Company’s current workforce by approximately 150 people. During the three and six months ended June 30, 2024, we incurred restructuring and related charges of $0.6 million and $7.8 million, respectively, consisting primarily of severance payments, employee benefits, and related cash expenses. These charges were recognized within transaction, integration, and restructuring expenses in our unaudited condensed consolidated statements of operations. We do not expect to incur any additional material charges associated with the 2024 Restructuring Plan.

Current wording

During the first quarter of 2024, we committed to a restructuring plan intended to reduce operating costs, improve operating margins, and continue advancing our ongoing commitment to profitable growth (the “2024 Restructuring Plan”). The 2024 Restructuring Plan provided for a reduction of the Company’s current workforce by approximately 150 people. During the three and nine months ended September 30, 2024, we incurred restructuring and related charges of $0.2 million and $8.0 million, respectively, consisting primarily of severance payments, employee benefits, and related cash expenses. These charges were recognized within transaction, integration, and restructuring expenses in our unaudited condensed consolidated statements of operations. We do not expect to incur any additional material charges associated with the 2024 Restructuring Plan.

Previous wording

In fiscal year 2024, we recorded impairment charges of $1.2 million related to the consolidation of certain leased office space at our corporate headquarters. These charges comprised $0.9 million relating to the operating lease right-of-use assets and $0.3 million relating to the leasehold improvements. During the first quarter of 2025, we incurred an additional $0.2 million in impairment charges related to the operating lease right-of-use assets. These charges were recognized within transaction, integration, and restructuring expenses in our unaudited condensed consolidated statements of operations for each respective period. No such charges were incurred during the second quarter of 2025.

Current wording

In fiscal year 2024, we recorded impairment charges of $1.2 million related to the consolidation of certain leased office space at our corporate headquarters. These charges comprised $0.9 million relating to the operating lease right-of-use assets and $0.3 million relating to the leasehold improvements. During the nine months ended September 30, 2025, we incurred additional impairment charges of $0.4 million related to the operating lease right-of-use assets. These charges were recognized within transaction, integration, and restructuring expenses in our unaudited condensed consolidated statements of operations for each respective period.

Previous wording

As part of the 2024 Restructuring Plan, we made significant changes to our go-to-market team that reduced overlay expenses, created a separate group and sales motion for our small and medium sized customers, and allocated more resources to our Enterprise Customers (as the term is defined below). These changes created disruptions to our sales efforts in 2024, impacting both new customer acquisition and upsell to existing customers. These factors, in addition to the lower than historical renewal rates we observed through the second half of 2024 and the first half of 2025, have impacted, and we expect will continue to impact, our results in 2025.

Current wording

As part of the 2024 Restructuring Plan, we made significant changes to our go-to-market team that reduced overlay expenses, created a separate group and sales motion for our small and medium sized customers, and allocated more resources to our Enterprise Customers (as the term is defined below). These changes created disruptions to our sales efforts in 2024, impacting both new customer acquisition and upsell to existing customers. These factors, in addition to the lower than historical renewal rates we observed through the second half of 2024 and throughout 2025, have impacted, and we expect will continue to impact, our results in 2025.

Previous wording

We have been observing changes in the healthcare claims data market as a result of data source disruption in calendar year 2024, including how data providers are reviewing pricing, data availability, and use terms, all of which may negatively impact the prices at which we acquire such data. We are continuing to evaluate these and other past and potential future direct and indirect impacts on our business and results of operations.

Current wording

We have been observing changes in the healthcare claims data market as a result of data source disruption in calendar year 2024, including how data providers are reviewing pricing, data availability, and use terms, all of which may negatively impact the prices at which we acquire such data. We are continuing to evaluate these and other past and potential future direct and indirect impacts on our business and results of operations. We are working to mitigate potential risk through renegotiation of select existing agreements and the addition of new data sources.

Previous wording

Our total customer count, which includes smaller customers, was approximately 2,400 as of June 30, 2025, compared with approximately 2,600 customers as of June 30, 2024. Our Enterprise Customer accounts have decreased by 27 to 510 customers as of June 30, 2025 compared with 537 customers as of June 30, 2024. Our smaller customers have churned at disproportionately higher rates, primarily due to current macroeconomic conditions.

Current wording

Our total customer count, which includes smaller customers, was approximately 2,400 as of September 30, 2025, compared with approximately 2,570 customers as of September 30, 2024. Our Enterprise Customer accounts have decreased by 10 to 520 customers as of September 30, 2025 compared with 530 customers as of September 30, 2024. Our smaller customers have churned at disproportionately higher rates year-over-year, primarily due to current macroeconomic conditions.

Previous wording

The growth of our business is driven in part by our ability to apply our deep healthcare domain expertise to innovate and expand our platform. We have continually created new products since our founding in 2011. We plan to continue to invest significantly into our engineering and research and development efforts to enhance our capabilities and functionality and facilitate the expansion of our platform to new use cases and customers. In addition, we work to continuously release updates and new features. While we are primarily focused on organic investments to drive innovation, we will also evaluate strategic acquisitions and investments that further expand our platform.

Current wording

The growth of our business is driven in part by our ability to apply our deep healthcare domain expertise to innovate and expand our platform. We have continually created new products since our founding in 2011. We have continued and plan to continue to invest significantly into our engineering and research and development efforts to enhance our capabilities and functionality and facilitate the expansion of our platform to new use cases and customers. In addition, we work to continuously release updates and new features. While we are primarily focused on organic investments to drive innovation, we will also evaluate strategic acquisitions and investments that further expand our platform.

Previous wording

For the six months ended June 30, 2025, we derived approximately 96% of our revenue from subscription services and the remainder from professional services. Our subscription services consist primarily of subscription fees for access to our platform and stand-ready support. Our subscription contracts typically have a term ranging from 1 to 3 years and are non-cancellable. We typically bill for services in advance annually, and we typically require payment at the beginning of each annual period. Our subscription revenue is recognized ratably over the contract term. Our professional services revenue typically is derived from non-recurring consulting services or from other one-time deliveries, which are generally capable of being distinct and can be accounted for as separate performance obligations. Revenue related to these professional services is recognized at a point in time when the performance obligations under the terms of the contract are satisfied and control has been transferred to the customer.

Current wording

For the nine months ended September 30, 2025, we derived approximately 97% of our revenue from subscription services and the remainder from professional services. Our subscription services consist primarily of subscription fees for access to our platform and stand-ready support. Our subscription contracts typically have a term ranging from 1 to 3 years and are non-cancellable. We typically bill for services in advance annually, and we typically require payment at the beginning of each annual period. Our subscription revenue is recognized ratably over the contract term. Our professional services revenue typically is derived from non-recurring consulting services or from other one-time deliveries, which are generally capable of being distinct and can be accounted for as separate performance obligations. Revenue related to these professional services is recognized at a point in time when the performance obligations under the terms of the contract are satisfied and control has been transferred to the customer.

Previous wording

As part of the 2024 Restructuring Plan, we made significant changes to our go-to-market team that reduced overlay expenses, created a separate group and sales motion for our small and medium sized customers, and allocated more resources to our Enterprise Customers. These changes disrupted our sales efforts in 2024, coupled with continued macroeconomic headwinds and sales execution challenges throughout 2024. As we moved through 2024 and the first half of 2025, we did not see subscription renewals return to historical levels. Based on these impacts, we expect our revenue to decline in 2025 compared with 2024.

Current wording

As part of the 2024 Restructuring Plan, we made significant changes to our go-to-market team that reduced overlay expenses, created a separate group and sales motion for our small and medium sized customers, and allocated more resources to our Enterprise Customers. These changes disrupted our sales efforts in 2024, coupled with continued macroeconomic headwinds and sales execution challenges throughout 2024. As we moved through 2024 and 2025, we have not seen subscription renewals return to historical levels. Based on these impacts, we expect our revenue to decline in 2025 compared with 2024.

Previous wording

We have been observing changes in the healthcare claims data market as a result of data source disruption since early 2024, including how data providers are reviewing pricing, data availability, and use terms, all of which may negatively impact the prices at which we acquire such data.

Current wording

We have been observing changes in the healthcare claims data market as a result of data source disruption since early 2024, including how data providers are reviewing pricing, data availability, and use terms, all of which may negatively impact the prices at which we acquire such data. We are working to mitigate potential risk through the renegotiation of select existing agreements and the addition of new data sources.

Previous wording

Other income (expense), net consists primarily of the revaluation of Tax Receivable Agreement liabilities, realized and unrealized gains and losses related to the impact of transactions denominated in a foreign currency, and a loss on the partial extinguishment of debt. Significant changes in the projected liability resulting from the Tax Receivable Agreement may occur based on changes in anticipated future taxable income, changes in applicable tax rates, or other changes in tax attributes that may occur and could affect the expected future tax benefits to be received by us. We do not have significant exposure to foreign exchange volatility and do not anticipate foreign currency transaction gains or losses to materially impact our results of operations.

Current wording

Other income (expense), net consists primarily of the revaluation of TRA liabilities, realized and unrealized gains and losses related to the impact of transactions denominated in a foreign currency, and a loss on the partial extinguishment of debt. Significant changes in the projected liability resulting from the TRA may occur based on changes in anticipated future taxable income, changes in applicable tax rates, or other changes in tax attributes that may occur and could affect the expected future tax benefits to be received by us. We do not have significant exposure to foreign exchange volatility and do not anticipate foreign currency transaction gains or losses to materially impact our results of operations.

Previous wording

Revenue decreased $7.3 million, or 6%, in the six months ended June 30, 2025 compared with the same period in the prior year due to lower subscription revenue of $8.2 million, partially offset by higher professional services revenue of $1.0 million. Revenue attributable to customers that existed prior to the start of 2025 decreased $14.8 million, which was partially offset by a $7.5 million increase in revenue from new customers in 2025, inclusive of revenue from a data partnership that was launched earlier this year.

Current wording

Revenue decreased $2.7 million, or 4%, in the three months ended September 30, 2025 compared with the same period in the prior year due to lower subscription revenue of $2.7 million, partially offset by higher professional services revenue of less than $0.1 million. Revenue attributable to customers that existed prior to the start of 2025 decreased $9.4 million, which was partially offset by a $6.7 million increase in revenue from new customers in 2025, inclusive of revenue from a data partnership that was launched earlier this year.

Previous wording

Cost of revenue increased $3.2 million, or 12%, in the six months ended June 30, 2025 compared with the same period in the prior year. The increase was driven primarily by a $3.9 million increase in amortization expense resulting from new data asset purchases and higher rates of amortization on certain technology assets amortized under economic consumption methods, and a $0.2 million increase in hosting fees and data subscription and collection costs. Though we continue to experience increased data and hosting costs as a result of expanded customer usage of our platform, the year-over-year increase in these costs were primarily offset by one-time credits totaling approximately $1.9 million we observed during the quarter ended June 30, 2025, primarily as a result of a renegotiation on an existing data contract. We also experienced a $0.9 million decrease in personnel costs, including stock-based compensation, which was primarily driven by costs incurred associated with the 2024 Restructuring Plan that did not repeat in 2025.

Current wording

Cost of revenue increased $0.4 million, or 3%, in the three months ended September 30, 2025 compared with the same period in the prior year. The increase was driven primarily by a $1.4 million increase in amortization expense resulting from new data asset purchases and higher rates of amortization on certain technology assets amortized under economic consumption methods, partially offset by a $0.8 million decrease in hosting fees and data subscription and collection costs. Though we continue to experience increased data and hosting costs as a result of expanded customer usage of our platform, the period-over-period net decrease in these costs was due to one-time credits resulting from renegotiations on existing data contracts and the exit of a major data contract from a prior acquisition that no longer provided an economic benefit to the Company. We also experienced a $0.2 million decrease in personnel costs, including stock-based compensation, which was primarily driven by a moderate reduction in headcount.

Previous wording

Operating expenses decreased $369.3 million, or 88%, during the three months ended June 30, 2025 compared with the same period in the prior year. The decrease to operating expense was primarily due to a goodwill impairment charge of $363.6 million incurred in the prior year period, which did not repeat in the current year period, and:

Current wording

Operating expenses decreased $219.7 million, or 80%, during the three months ended September 30, 2025 compared with the same period in the prior year. The decrease to operating expense was primarily due to a goodwill impairment charge of $228.2 million incurred in the prior year period, which did not repeat in the current year period, and:

Previous wording

A decrease in product development expense of $2.2 million for the three months ended June 30, 2025, primarily due to lower personnel costs in the current period, including stock-based compensation expense, resulting from the 2024 Restructuring Plan. These decreases were partially offset by increased costs associated with new software application investments in the current period;

Current wording

An increase in product development expense of $0.3 million for the three months ended September 30, 2025, primarily due to increased costs associated with new software application investments during the current year, partially offset by lower personnel costs in the current period resulting from an increase in capitalized payroll and third-party costs related to internal-use software development;

Previous wording

An increase in general and administrative expense of $0.1 million for the three months ended June 30, 2025, primarily due to reductions in bad debt expense, sales tax exposure charges, and consulting fees and severance costs associated with strategic transition initiatives. These decreases were partially offset by higher personnel costs, including stock-based compensation;

Current wording

An increase in general and administrative expense of $1.0 million for the three months ended September 30, 2025, primarily due to consulting fees and severance costs associated with strategic transition initiatives and the write-off of deferred offering costs associated with the Company’s expired shelf registration, partially offset by reductions in bad debt expense.

Previous wording

Total other expense, net was $4.6 million for the three months ended June 30, 2025 compared to total other income, net, of $41.6 million in the same period in the prior year. The change was primarily driven by a TRA liability remeasurement loss of $2.9 million during the three months ended June 30, 2025 compared with a $41.7 million gain during the same period in the prior year. The TRA liability remeasurement gain in the prior year was primarily driven by a $363.6 million goodwill impairment charge incurred during the three months ended June 30, 2024. Also contributing to the change was a foreign currency transaction loss of $0.5 million in the current year period, compared with a loss of $0.1 million in the prior year period, as well as interest expense, net, of $1.2 million in the current period, compared with interest expense, net, of less than $0.1 million in the prior year period.

Current wording

Total other expense, net was $8.6 million for the three months ended September 30, 2025 compared to total other income, net, of $23.8 million in the same period in the prior year. The change was primarily driven by a TRA liability remeasurement loss of $7.1 million during the three months ended September 30, 2025 due largely to tax law updates concerning software development expenses under Internal Revenue Code Section 174 (“IRC 174”) from the codification of the One Big Beautiful Bill Act (the “OBBBA”), compared with a $24.2 million gain during the same period in the prior year. The TRA liability remeasurement gain in the prior year was primarily driven by a $228.2 million goodwill impairment charge incurred during the three months ended September 30, 2024. Also contributing to the change was a foreign currency transaction loss of $0.1 million in the current year period, compared with a loss of $0.4 million in the prior year period, as well as interest expense, net, of $1.3 million in the current period, compared with interest expense, net, of less than $0.1 million in the prior year period.

Previous wording

Provision for income taxes was $0.5 million for the three months ended June 30, 2025 compared to a benefit from income taxes of $21.9 million in the comparable prior year period. The overall change was primarily attributed to the $363.6 million impairment of goodwill during the prior period, resulting in a reduction of indefinite-lived deferred tax liabilities. The resulting income tax benefit from the goodwill impairment did not reoccur in the current period.

Current wording

Provision for income taxes was $0.5 million for the three months ended September 30, 2025 compared to a benefit from income taxes of $13.7 million in the comparable prior year period. The overall change was primarily attributed to the $228.2 million impairment of goodwill during the prior period, resulting in a reduction of indefinite-lived deferred tax liabilities. The resulting income tax benefit from the goodwill impairment did not reoccur in the current period.

Previous wording

Revenue decreased $3.0 million, or 5%, in the three months ended June 30, 2025 compared with the same period in the prior year due to lower subscription revenue of $3.8 million, partially offset by higher professional services revenue of $0.8 million. Revenue attributable to customers that existed prior to the start of 2025 decreased $7.9 million, which was partially offset by a $4.9 million increase in revenue from new customers in 2025, inclusive of revenue from a data partnership that was launched earlier this year.

Current wording

Revenue decreased $9.9 million, or 5%, in the nine months ended September 30, 2025 compared with the same period in the prior year due to lower subscription revenue of $10.9 million, partially offset by higher professional services revenue of $1.0 million. Revenue attributable to customers that existed prior to the start of 2025 decreased $24.1 million, which was partially offset by a $14.2 million increase in revenue from new customers in 2025, inclusive of revenue from a data partnership that was launched earlier this year.

Previous wording

Cost of revenue increased $0.9 million, or 6%, in the three months ended June 30, 2025 compared with the same period in the prior year. The increase was driven primarily by a $2.0 million increase in amortization expense resulting from new data asset purchases and higher rates of amortization on certain technology assets amortized under economic consumption methods, partially offset by a $0.6 million decrease in hosting fees and data subscription and collection costs. Though we continue to experience increased data and hosting costs as a result of expanded customer usage of our platform, the year-over-year decrease in these costs was due to one-time credits totaling approximately $1.9 million we observed during the quarter ended June 30, 2025, primarily as a result of a renegotiation on an existing data contract. We also experienced a $0.4 million decrease in personnel costs, including stock-based compensation, which was primarily driven by costs incurred associated with the 2024 Restructuring Plan that did not repeat in 2025.

Current wording

Cost of revenue increased $3.6 million, or 9%, in the nine months ended September 30, 2025 compared with the same period in the prior year. The increase was driven primarily by a $5.3 million increase in amortization expense resulting from new data asset purchases and higher rates of amortization on certain technology assets amortized under economic consumption methods, partially offset by a $0.9 million decrease in hosting fees and data subscription and collection costs. Though we continue to experience increased data and hosting costs as a result of expanded customer usage of our platform, the year-over-year net decrease in these costs was due to one-time credits resulting from renegotiations on existing data contracts and the exit of a major data contract from a prior acquisition that no longer provided an economic benefit to the Company. We also experienced a $0.8 million decrease in personnel costs, including stock-based compensation, which was primarily driven by a moderate reduction in headcount.

Previous wording

Operating expenses, which included goodwill impairment charges of $176.5 million and $363.6 million incurred during the six months ended June 30, 2025 and 2024, respectively (refer to Note 8. Goodwill and Intangible Assetsto our accompanying unaudited condensed consolidated financial statements for further details), decreased $207.4 million, or 43%, during the six months ended June 30, 2025 compared with the same period in the prior year. The decrease to operating expense as compared to the prior-year period was primarily due to a lower goodwill impairment charge in the current period and:

Current wording

Operating expenses, which included goodwill impairment charges of $176.5 million and $591.8 million incurred during the nine months ended September 30, 2025 and 2024, respectively (refer to Note 8. Goodwill and Intangible Assetsto our accompanying unaudited condensed consolidated financial statements for further details), decreased $427.1 million, or 56%, during the nine months ended September 30, 2025 compared with the same period in the prior year. The decrease to operating expense as compared to the prior-year period was primarily due to a lower goodwill impairment charge in the current period and:

Previous wording

A decrease in sales and marketing expense of $2.2 million for the six months ended June 30, 2025, primarily due to lower personnel costs in the current period, including stock-based compensation expense, resulting from the 2024 Restructuring Plan and the departure of certain executive-level employees in the prior year, which did not repeat at the same level during the six months ended June 30, 2025, partially offset by increased costs associated with new software applications, and with certain sales and marketing events in the current period;

Current wording

A decrease in sales and marketing expense of $1.9 million for the nine months ended September 30, 2025, primarily due to lower personnel costs in the current period, including stock-based compensation expense, resulting from the 2024 Restructuring Plan and the departure of certain executive-level employees in the prior year, which did not repeat at the same level during the nine months ended September 30, 2025, partially offset by increased costs associated with new software applications, and with certain sales and marketing events and advertising campaigns in the current period;

Previous wording

A decrease in product development expense of $3.0 million for the six months ended June 30, 2025, primarily driven by lower personnel costs in the current period, including stock-based compensation expense. Higher stock-based compensation costs in the first quarter of 2024 associated with equity grant modifications were primarily driven by the 2024 Restructuring Plan, which did not repeat at the same level during the current period. These decreases were partially offset by increased costs associated with new software application investments in the current period;

Current wording

A decrease in product development expense of $2.7 million for the nine months ended September 30, 2025, primarily driven by lower personnel costs in the current period, including stock-based compensation expense. Higher stock-based compensation costs in the first quarter of 2024 associated with equity grant modifications were primarily driven by the 2024 Restructuring Plan, which did not repeat at the same level during the current period. Capitalized payroll and third-party costs related to internal-use software development also increased during the current period, further contributing to the year-over-year decrease in product development expense, which was partially offset by increased costs associated with new software application investments in the current period;

Previous wording

A decrease in general and administrative expense of $4.5 million for the six months ended June 30, 2025, primarily driven by lower stock-based compensation expense in the current period. Higher costs incurred in the prior period associated with equity grant modifications were primarily driven by the 2024 Restructuring Plan and the departure of certain executive-level employees, which did not repeat at the same level during the current period. Also during the current period, we experienced reductions in bad debt expense, sales tax exposure charges, and consulting fees and severance costs associated with strategic transition initiatives. These decreases were partially offset by higher personnel costs and higher franchise taxes;

Current wording

A decrease in general and administrative expense of $3.5 million for the nine months ended September 30, 2025, primarily driven by lower stock-based compensation expense in the current period. Higher costs incurred in the prior period associated with equity grant modifications were primarily driven by the 2024 Restructuring Plan and the departure of certain executive-level employees, which did not repeat at the same level during the current period. Also during the current period, we experienced reductions in bad debt expense and business insurance costs. These decreases were partially offset by higher personnel costs, including consulting fees and severance costs associated with strategic transition initiatives, higher franchise taxes, and a charge for the write-off of deferred offering costs associated with the Company’s expired shelf registration;

Previous wording

A decrease in depreciation and amortization expense of $1.2 million for the six months ended June 30, 2025, primarily driven by certain customer relationship intangible assets utilizing economic consumption amortization methods with lower amortization in the current period; and

Current wording

A decrease in depreciation and amortization expense of $1.6 million for the nine months ended September 30, 2025, primarily driven by certain customer relationship intangible assets utilizing economic consumption amortization methods with lower amortization in the current period; and

Previous wording

A decrease in transaction, integration, and restructuring expenses of $2.2 million for the three months ended June 30, 2025, primarily driven by higher costs incurred in the prior year period associated with the consolidation of certain leased office facilities and the 2024 Restructuring Plan.

Current wording

A decrease in transaction, integration, and restructuring expenses of $2.1 million for the nine months ended September 30, 2025, primarily driven by higher costs incurred in the prior year period associated with the 2024 Restructuring Plan and the consolidation of certain leased office facilities, which did not repeat at the same level during the current period, partially offset by higher acquisition and integration costs during the current period, including an integration charge to recognize a liability for a major data contract from a prior acquisition that no longer provided an economic benefit to the Company.

Previous wording

Total other income, net was $14.2 million for the six months ended June 30, 2025 compared to $44.3 million in the same period in the prior year. The decrease was primarily driven by a decrease in the TRA liability remeasurement gain of $26.2 million during the six months ended June 30, 2025, compared with the same period in the prior year. The TRA liability remeasurement gain was lower in the current period, primarily as a result of a $187.1 million decrease in goodwill impairment charges incurred during the six months ended June 30, 2025 compared with the same period in 2024. Also contributing to the decrease was a foreign currency transaction loss of $1.5 million in the current year period, compared with a gain of $0.3 million in the prior year period, interest expense, net, of $1.6 million in the current year period, compared with interest income, net, of $0.1 million in the prior year period, and a $0.5 million loss on the partial extinguishment of debt incurred during the six months ended June 30, 2025.

Current wording

Total other income, net was $5.6 million for the nine months ended September 30, 2025 compared to $68.1 million in the same period in the prior year. The decrease was primarily driven by a $57.5 million decrease in the TRA liability remeasurement gain during the nine months ended September 30, 2025, compared with the same period in the prior year. The TRA liability remeasurement gain was lower in the current period, primarily as a result of a $415.3 million decrease in goodwill impairment charges incurred during the nine months ended September 30, 2025 compared with the same period in 2024, and to a lesser extent by a TRA remeasurement loss in the current quarter driven by tax law updates concerning software development expenses under IRC 174 from the codification of the OBBBA. Also contributing to the decrease in other income, net was a foreign currency transaction loss of $1.6 million in the current year period, compared with a loss of $0.1 million in the prior year period, interest expense, net, of $3.0 million in the current year period, compared with interest income, net, of less than $0.1 million in the prior year period, and a $0.5 million loss on the partial extinguishment of debt incurred during the nine months ended September 30, 2025.

Previous wording

Benefit from income taxes was $10.4 million for the six months ended June 30, 2025 compared to $22.7 million in the comparable prior year period. The decrease was primarily attributed to a $187.1 million decrease in goodwill impairment charges during the current period, resulting in reduced income tax benefits from the reduction of indefinite-lived deferred tax liabilities.

Current wording

Benefit from income taxes was $9.9 million for the nine months ended September 30, 2025 compared to $36.4 million in the comparable prior year period. The decrease was primarily attributed to a $415.3 million decrease in goodwill impairment charges during the current period, resulting in reduced income tax benefits from the reduction of indefinite-lived deferred tax liabilities.

Previous wording

We present “Adjusted EBITDA” as a measure of our operating performance. EBITDA is defined as earnings before (i) debt-related costs, including interest expense and loss on partial extinguishment of debt, (ii) interest expense (income), net, (iii) provision for (benefit from) income taxes, and (iv) depreciation and amortization. Management further adjusts EBITDA in its presentation of Adjusted EBITDA to exclude (i) other expense (income), net, (ii) equity-based compensation, (iii) transaction, integration, and restructuring expenses, (iv) goodwill impairment, and (v) other non-core items. We exclude these items because they are by nature non-cash, non-recurring, and/or unrelated to our core operations, and therefore we do not believe them to be representative of ongoing operational performance. Adjusted EBITDA Margin is defined as Adjusted EBITDA as a percentage of revenue. Adjusted EBITDA and Adjusted EBITDA Margin are key metrics used by management and our Board to assess the profitability of our operations. We believe these metrics provide useful measures to investors to assess our operating performance and in measuring the profitability of our operations on a consolidated level.

Current wording

We present “Adjusted EBITDA” as a measure of our operating performance. EBITDA is defined as earnings before (i) debt-related costs, including interest expense (income), net and loss on partial extinguishment of debt, (ii) provision for (benefit from) income taxes, and (iii) depreciation and amortization. Management further adjusts EBITDA in its presentation of Adjusted EBITDA to exclude (i) other expense (income), net, (ii) equity-based compensation, (iii) transaction, integration, and restructuring expenses, (iv) goodwill impairment, and (v) other non-core items. We exclude these items because they are by nature non-cash, non-recurring, and/or unrelated to our core operations, and therefore we do not believe them to be representative of ongoing operational performance. Adjusted EBITDA Margin is defined as Adjusted EBITDA as a percentage of revenue. Adjusted EBITDA and Adjusted EBITDA Margin are key metrics used by management and our Board to assess the profitability of our operations. We believe these metrics provide useful measures to investors to assess our operating performance and in measuring the profitability of our operations on a consolidated level.

Previous wording

Primarily represents foreign exchange and Tax Receivable Agreement liability remeasurement gains and losses.

Current wording

Primarily represents foreign exchange and TRA liability remeasurement gains and losses.

Previous wording

Transaction and integration expenses primarily represent legal, accounting, and consulting expenses and fair value adjustments for contingent consideration related to our acquisitions and strategic partnerships. Restructuring expenses relate to the 2024 Restructuring Plan, as well as impairment and restructuring charges related to office closures, relocations, and consolidations.

Current wording

Transaction and integration expenses primarily represent legal, accounting, and consulting expenses and fair value adjustments for contingent consideration related to our acquisitions and strategic partnerships, inclusive of an integration charge in the third quarter of 2025 to recognize a liability for a major data contract from a prior acquisition that no longer provided an economic benefit to the Company. Restructuring expenses relate to the 2024 Restructuring Plan as well as impairment and restructuring charges related to office closures, relocations, and consolidations.

Previous wording

Goodwill impairment represents non-cash, pre-tax, goodwill impairment charges. We experienced declines in our market capitalization as a result of a sustained decrease in our stock price, which represented a triggering event requiring our management to perform a quantitative goodwill impairment test as of the end of the first quarter of 2025. As a result of the impairment test conducted, we determined that the fair value of our single reporting unit was lower than its carrying value and, accordingly, recorded the impairment charge.

Current wording

Goodwill impairment represents non-cash, pre-tax, goodwill impairment charges. We experienced declines in our market capitalization as a result of sustained decreases in our stock price, which represented triggering events requiring our management to perform quantitative goodwill impairment tests as of the end of the first quarter of 2025 and multiple quarters in fiscal year 2024. As a result of the impairment tests conducted, we determined that the fair value of our single reporting unit was lower than its carrying value and, accordingly, recorded the impairment charges.

Previous wording

Other non-core items represent expenses driven by events that are typically by nature one-time, non-operational, and/or unrelated to our core operations. These expenses are comprised of non-core legal and regulatory costs isolated to unique and extraordinary litigation, legal and regulatory matters that are not considered normal and recurring business activity, including sales tax accrual adjustments inclusive of penalties and interest for sales taxes that we may have been required to collect from customers in certain previous years, and other non-recurring legal and regulatory matters. Other non-core items also include consulting fees and severance costs associated with strategic transition initiatives, as well as professional fees related to financing, capital structure changes, and other non-core items.

Current wording

Other non-core items represent expenses driven by events that are typically by nature one-time, non-operational, and/or unrelated to our core operations. These expenses are comprised of non-core legal and regulatory costs isolated to unique and extraordinary litigation, legal and regulatory matters that are not considered normal and recurring business activity, including sales tax accrual adjustments inclusive of penalties and interest for sales taxes that we may have been required to collect from customers in certain previous years, and other non-recurring legal and regulatory matters. Other non-core items also include consulting fees and severance costs associated with strategic transition initiatives, as well as professional fees related to financing, capital structure changes, and other non-core items, including a charge in the third quarter of 2025 for the write-off of deferred offering costs associated with the Company’s expired shelf registration.

Previous wording

As of June 30, 2025, we had $81.0 million of cash and cash equivalents, $103.2 million of short-term investments, and $49.7 million available under our Revolving Credit Facility (as the term is defined below). Our principal sources of liquidity are cash and cash equivalents and short-term investments on hand, as well as the cash flows we generate from operations. Our principal uses of liquidity have been, and are expected to continue to be, primarily for investment in long-term growth of the business through capital expenditures, acquisitions, as well as for debt services (see Note 10. Long-Term Debt to our accompanying unaudited condensed consolidated financial statements for further details), repurchases of our Class A Common Stock, and distributions to members of Definitive OpCo, and payments under our tax receivable agreement.

Current wording

As of September 30, 2025, we had $108.3 million of cash and cash equivalents, $77.6 million of short-term investments, and $49.7 million available under our Revolving Credit Facility (as the term is defined below). Our principal sources of liquidity are cash and cash equivalents and short-term investments on hand, as well as the cash flows we generate from operations. Our principal uses of liquidity have been, and are expected to continue to be, primarily for investment in long-term growth of the business through capital expenditures and acquisitions, as well as for various other financing activities, including debt services (see Note 10. Long-Term Debt to our accompanying unaudited condensed consolidated financial statements for further details), repurchases of our Class A Common Stock, distributions to members of Definitive OpCo, and payments under our TRA liability.

Previous wording

Net cash provided by operating activities was $35.4 million during the six months ended June 30, 2025, primarily as a result of a net loss of $164.4 million, offset by non-cash charges of $198.5 million. The non-cash charges were primarily comprised of $176.5 million in goodwill impairment charges recorded during the six months ended June 30, 2025, a gain on remeasurement of the TRA of $17.8 million, amortization of intangible assets of $26.7 million, a decrease in deferred taxes of $10.6 million, equity compensation costs of $14.3 million, amortization of deferred contract costs of $7.9 million, and a $0.5 million loss on the extinguishment of debt. The net increase in operating assets and liabilities of $1.2 million for the six months ended June 30, 2025 was primarily driven by cash inflows resulting from a decrease in accounts receivable of $15.9 million, and an increase in deferred revenue of $8.0 million due to the timing of billings and cash received in advance of revenue recognition for subscription services. These factors were partially offset by cash outflows resulting from lower accounts payable, accrued expenses, and other liabilities, collectively, of $12.1 million, an increase in deferred contract costs of $6.3 million, and an increase in prepaid expenses and other assets of $4.2 million.

Current wording

Net cash provided by operating activities was $51.1 million during the nine months ended September 30, 2025, primarily as a result of a net loss of $182.2 million, offset by non-cash charges of $227.8 million. The non-cash charges were primarily comprised of $176.5 million in goodwill impairment charges recorded during the nine months ended September 30, 2025, a gain on remeasurement of the TRA of $10.6 million, amortization of intangible assets of $39.9 million, equity compensation costs of $21.0 million, amortization of deferred contract costs of $11.9 million, a decrease in deferred taxes of $10.3 million, and a $0.5 million loss on the partial extinguishment of debt. The net increase in operating assets and liabilities of $5.4 million for the nine months ended September 30, 2025 was primarily driven by cash inflows resulting from a decrease in accounts receivable of $19.4 million and higher accounts payable, accrued expenses, and other liabilities, collectively, of $0.4 million. These factors were partially offset by cash outflows resulting from an increase in deferred contract costs of $9.4 million, an increase in prepaid expenses and other assets of $3.5 million, and a decrease in deferred revenue of $1.5 million due to the timing of billings and cash received in advance of revenue recognition for subscription services.

Previous wording

Cash provided by investing activities during the six months ended June 30, 2025 was $73.4 million, driven primarily by $147.4 million in maturities of short-term investments, partially offset by $64.1 million in purchases of short-term investments, and $10.0 million in purchases of property (including software), equipment, and data assets.

Current wording

Cash provided by investing activities during the nine months ended September 30, 2025 was $97.5 million, driven primarily by $173.9 million in maturities of short-term investments, partially offset by $64.1 million in purchases of short-term investments, and $12.3 million in purchases of property (including software), equipment, and data assets.

Previous wording

Cash used in financing activities during the six months ended June 30, 2025 was $134.4 million, driven by net repayments of the 2021 Term Loan (as defined below) of $73.4 million, payments of $40.2 million for repurchases of our Class A Common Stock, including commissions, payments of $13.8 million under the TRA, taxes paid related to the net share settlement of equity awards of $2.5 million, distributions to members of $2.8 million, and payments of debt issuance costs of $1.7 million.

Current wording

Cash used in financing activities during the nine months ended September 30, 2025 was $146.9 million, driven by net repayments of the 2021 Term Loan (as defined below) of $75.6 million, payments of $49.5 million for repurchases of our Class A Common Stock, including commissions, payments of $13.8 million under the TRA, taxes paid related to the net share settlement of equity awards of $3.5 million, distributions to members of $2.8 million, and payments of debt issuance costs of $1.7 million.

Previous wording

The loans under the Term Facility and the Revolving Credit Facility mature on January 16, 2030. The Facilities are guaranteed, subject to customary exceptions, by all of DH Holdings’ wholly-owned domestic restricted subsidiaries and AIDH Buyer, LLC, a Delaware limited liability company and the direct parent company of DH Holdings (“Holdings”), and are secured by associated collateral agreements that pledge a lien on substantially all of DH Holdings’ assets, including fixed assets and intangibles, and the assets of the guarantors, in each case, subject to customary exceptions (the “Pledged Assets”). As of June 30, 2025, the Pledged Assets of these subsidiaries approximated $664.2 million, and the net assets of these subsidiaries approximated $351.7 million.

Current wording

The loans under the Term Facility and the Revolving Credit Facility mature on January 16, 2030. The Facilities are guaranteed, subject to customary exceptions, by all of DH Holdings’ wholly-owned domestic restricted subsidiaries and AIDH Buyer, LLC, a Delaware limited liability company and the direct parent company of DH Holdings (“Holdings”), and are secured by associated collateral agreements that pledge a lien on substantially all of DH Holdings’ assets, including fixed assets and intangibles, and the assets of the guarantors, in each case, subject to customary exceptions (the “Pledged Assets”). As of September 30, 2025, the Pledged Assets of these subsidiaries approximated $649.0 million, and the net assets of these subsidiaries approximated $335.5 million.

Previous wording

In connection with the DH Holdings Credit Agreement Amendment, we repaid $69.1 million of outstanding principal amount of the Term Facility and reduced our borrowing capacity under the Revolving Credit Facility by $25.0 million. As a result, we incurred a loss on partial extinguishment of debt of $0.5 million during the first quarter of 2025 attributed to the derecognition of a proportionate amount of the unamortized debt discount, a result of repaying the $69.1 million of outstanding principal on the Term Facility and reducing our Revolving Credit Facility. In addition, we capitalized financing costs totaling $1.7 million, of which $1.2 million related to the Term Facility and $0.5 million related to the Revolving Line of Credit. The financing costs associated with the Term Facility are recorded as a contra-debt balance in term loan, net of current portion in the consolidated balance sheets and are amortized over the remaining life of the loan using the effective interest method. The financing costs associated with the Revolving Line of Credit are recorded in other assets in the unaudited condensed consolidated balance sheets are amortized over the life of the arrangement. At June 30, 2025 and December 31, 2024, the unamortized financing costs were $0.5 million and $0.3 million, respectively.

Current wording

In connection with the DH Holdings Credit Agreement Amendment, we repaid $69.1 million of outstanding principal amount of the Term Facility and reduced our borrowing capacity under the Revolving Credit Facility by $25.0 million. As a result, we incurred a loss on partial extinguishment of debt of $0.5 million during the first quarter of 2025 attributed to the derecognition of a proportionate amount of the unamortized debt discount, a result of repaying the $69.1 million of outstanding principal on the Term Facility and reducing our Revolving Credit Facility. In addition, we capitalized financing costs totaling $1.7 million, of which $1.2 million related to the Term Facility and $0.5 million related to the Revolving Line of Credit. The financing costs associated with the Term Facility are recorded as a contra-debt balance in term loan, net of current portion in the consolidated balance sheets and are amortized over the remaining life of the loan using the effective interest method. The financing costs associated with the Revolving Line of Credit are recorded in other assets in the unaudited condensed consolidated balance sheets and are amortized over the life of the arrangement. At September 30, 2025 and December 31, 2024, the unamortized financing costs were $0.5 million and $0.3 million, respectively.

Previous wording

Financing obligations generally include repayment of principal amounts of the 2021 Term Loan, lease payments, and purchase obligations. With the exception of the DH Holdings Credit Agreement Amendment as described under Debt Obligations, there have been no material changes to our financing obligations during the six months ended June 30, 2025. Refer to Note 5. Leases and Note 14. Commitments and Contingencies to our consolidated financial statements included in our 2024 Form 10-K for further information.

Current wording

Financing obligations generally include repayment of principal amounts of the 2021 Term Loan, lease payments, and purchase obligations. With the exception of the DH Holdings Credit Agreement Amendment as described under Debt Obligations, there have been no material changes to our financing obligations during the nine months ended September 30, 2025. Refer to Note 5. Leases and Note 14. Commitments and Contingencies to our consolidated financial statements included in our 2024 Form 10-K for further information.