BLACKBAUD INC

Previous wording

•And lastly, we have right-sized our operations by rationalizing office leases and renegotiating a number of our significant vendor contracts.

Current wording

•We have right-sized our operations by rationalizing office leases and renegotiating a number of our significant vendor contracts.

Previous wording

Three specific areas that our management team has focused on have contributed to our positive second quarter results: 1) acquiring new logos; 2) driving innovation and as such, strengthening our customer relationships through additional solutions and renewals; and 3) driving higher profitability through operational discipline and efficiencies.

Current wording

Three specific areas that our management team continues to focus on: 1) acquiring new logos; 2) driving innovation and, as such, strengthening our customer relationships through additional solutions and renewals; and 3) driving higher profitability through operational discipline and efficiencies.

Previous wording

As a remote-first workforce company, we continuously evaluate opportunities to shift various business units, functions or roles to lower-cost jurisdictions, including internationally, and may do so if and when we determine that it would reduce costs without negatively impacting the quality of our products and services. For example, we are currently expanding our operations in India, which we expect will give us greater access to talent, and increase the number of our employees, including management, in India. We have leased office space in India to accommodate those new operations, although we do not currently expect to have sales to customers in India in the foreseeable future.

Current wording

As a remote-flexible workforce company, we continuously evaluate opportunities to shift various business units, functions or roles to lower-cost jurisdictions, including internationally, when we determine that it would reduce costs without negatively impacting the quality of our products and services. See discussion about our operations in India above.

Previous wording

In February 2025, we announced that we intend to repurchase during 2025 between 3% and 5% of our outstanding common stock as of December 31, 2024 under our stock repurchase program. During the three months ended June 30, 2025, we did not repurchase any shares. During the six months ended June 30, 2025, we repurchased 1,513,022 shares for $100.0 million. Including net share settlement of employee stock compensation, this represents approximately 4.2% of the Company's common stock outstanding as of December 31, 2024. The remaining amount available to purchase stock under our stock repurchase program was $544.5 million as of June 30, 2025.

Current wording

In February 2025, we announced our intention to repurchase between 3% and 5% of our outstanding common stock as of December 31, 2024, during the course of 2025 under our stock repurchase program. During the three months ended September 30, 2025, we repurchased 459,528 shares for $30.1 million. During the nine months ended September 30, 2025, we repurchased an aggregate of 1,972,550 shares for $130.2 million. Including net share settlement of employee stock compensation, these repurchases represent approximately 5.2% of our outstanding common stock as of December 31, 2024. As of September 30, 2025, $514.4 million remained available under our stock repurchase program. We expect to remain active in the market during the fourth quarter of 2025 and into 2026. Based on our current plans, we expect total repurchases during 2025 to represent between 5.2% and 7.0% of our outstanding common stock as of December 31, 2024. We preliminarily expect our share repurchase activity in 2026 to be similar to 2025.

Previous wording

Income from operations increased by $14.6 million during the three months ended June 30, 2025, when compared to the same period in 2024, driven largely by the following:

Current wording

Income from operations increased by $13.4 million and $35.7 million, during the three and nine months ended September 30, 2025, respectively, when compared to the same periods in 2024, driven largely by the following:

Previous wording

We are continuing to make critical investments in the business in areas such as innovation, cybersecurity, and our continued shift of cloud infrastructure to leading public cloud service providers.

Current wording

We are continuing to make critical investments in the business in areas such as innovation, AI, cybersecurity, and our continued shift of cloud infrastructure to leading public cloud service providers.

Previous wording

At June 30, 2025, our cash and cash equivalents were $41.6 million. Under the 2024 Credit Facilities, the carrying amount of our debt was $1.1 billion and our net leverage ratiowas 2.70 to 1.00.

Current wording

At September 30, 2025, our cash and cash equivalents were $38.3 million. Under the 2024 Credit Facilities, the carrying amount of our debt was $1.0 billion and our net leverage ratiowas 2.45 to 1.00.

Previous wording

During the six months ended June 30, 2025, we generated $68.3 million in cash from operations, had a net increase in borrowings of $84.6 million, returned $103.2 million to stockholders by way of share repurchases, including excise tax payments, and had aggregate cash outlays of $29.1 million for purchases of property and equipment and capitalized software development costs.

Current wording

During the nine months ended September 30, 2025, we generated $207.5 million in cash from operations, had a net decrease in borrowings of $9.9 million, returned $130.2 million to stockholders by way of share repurchases, and had aggregate cash outlays of $45.1 million for purchases of property and equipment and capitalized software development costs.

Previous wording

Comparison of the three and six months ended June 30, 2025 and 2024

Current wording

Comparison of the three and nine months ended September 30, 2025 and 2024

Previous wording

Cost of revenue is primarily comprised of compensation costs for customer support, production IT, professional services and onsite training personnel, hosting and data center costs, third-party contractor expenses, third-party royalty and data expenses, allocated depreciation, facilities and IT support costs, amortization of intangible assets from business combinations, amortization of software development costs, transaction-based costs related to payments services including remittances of amounts due to third-parties, data expense incurred to perform one-time analytic services and other costs incurred in providing support, recurring services and onsite customer training to our customers.

Current wording

Cost of revenue is primarily comprised of compensation costs for customer support, production IT, professional services and onsite training personnel, hosting and data center costs, third-party contractor expenses, third-party royalty and data expenses, allocated depreciation, facilities and IT support (including cybersecurity) costs, amortization of intangible assets from business combinations, amortization of software development costs, transaction-based costs related to payments services including remittances of amounts due to third-parties, data expense incurred to perform one-time analytic services and other costs incurred in providing support, recurring services and onsite customer training to our customers.

Previous wording

Revenue decreased by $5.9 million, or 2.1%, and $14.5 million, or 2.6%, during the three and six months ended June 30, 2025, respectively, when compared to the same periods in 2024. For a discussion of our changes in revenue, see "Revenue" above starting on page 24 in this report.

Current wording

Revenue decreased by $5.5 million, or 1.9%, and $19.4 million, or 2.3%, during the three and nine months ended September 30, 2025, respectively, when compared to the same periods in 2024. For a discussion of our changes in revenue, see "Revenue" above starting on page 32 in this report.

Previous wording

Cost of revenue decreased by $11.1 million, or 8.9%, and $22.5 million, or 9.0%, during the three and six months ended June 30, 2025, respectively, when compared to the same periods in 2024, driven primarily by the following:

Current wording

Cost of revenue decreased by $15.6 million, or 12.1%, and $41.5 million, or 10.8%, during the three and nine months ended September 30, 2025, respectively, when compared to the same periods in 2024, driven primarily by the following:

Previous wording

Gross margin increased by 300 basis points and 290 basis points for the three and six months ended June 30, 2025, respectively, when compared to the same periods in 2024, primarily due to the decreases in cost of revenue outpacing the decreases in revenue.

Current wording

Gross margin increased by 470 basis points and 390 basis points for the three and nine months ended September 30, 2025, respectively, when compared to the same periods in 2024, primarily due to the decreases in cost of revenue outpacing the decreases in revenue.

Previous wording

Sales, marketing and customer success expense includes compensation costs, variable sales commissions, travel-related expenses, advertising and marketing materials, public relations costs, variable reseller commissions and allocated depreciation, facilities and IT support costs.

Current wording

Sales, marketing and customer success expense includes compensation costs, variable sales commissions, travel-related expenses, advertising and marketing materials, public relations costs, variable reseller commissions and allocated depreciation, facilities and IT support (including cybersecurity) costs.

Previous wording

Sales, marketing and customer success expense decreased by $3.0 million, or 6.4%, and $9.3 million, or 9.5%, during the three and six months ended June 30, 2025, respectively, when compared to the same periods in 2024. The decreases in dollars and as a percentage of revenue were primarily driven by the following:

Current wording

Sales, marketing and customer success expense decreased by $5.7 million, or 11.4%, and $14.6 million, or 9.9%, during the three and nine months ended September 30, 2025, respectively, when compared to the same periods in 2024. The decreases in dollars and as a percentage of revenue were primarily driven by the following:

Previous wording

Research and development expense includes compensation costs for engineering and product management personnel, third-party contractor expenses, software development tools and other expenses related to developing new solutions or upgrading and enhancing existing solutions that do not qualify for capitalization, and allocated depreciation, facilities and IT support costs.

Current wording

Research and development expense includes compensation costs for engineering and product management personnel, third-party contractor expenses, software development tools and other expenses related to developing new solutions or upgrading and enhancing existing solutions that do not qualify for capitalization, and allocated depreciation, facilities and IT support (including cybersecurity) costs.

Previous wording

We continue to make investments intended to delight our customers with innovative and secure cloud solutions. Research and development expenses decreased by $5.5 million, or 14.0%, and $14.7 million, or 18.0%, during the three and six months ended June 30, 2025, respectively, when compared to the same periods in 2024. The decreases in dollars and as a percentage of revenue were primarily driven by the following:

Current wording

We continue to make investments intended to delight our customers with innovative and secure cloud solutions, including AI technology. Research and development expenses decreased by $0.7 million, or 1.9%, and $11.7 million, or 10.1%, during the three and nine months ended September 30, 2025, respectively, when compared to the same periods in 2024. The decreases were primarily driven by the following:

Previous wording

Not included in research and development expense for the three months ended June 30, 2025 and 2024 were $14.4 million and $14.8 million, respectively, and for the six months ended June 30, 2025 and 2024 were $26.8 million and $28.5 million, respectively, of qualifying costs associated with software development activities that are required to be capitalized under GAAP, such as those for our cloud solutions. Qualifying capitalized development costs associated with our cloud solutions are subsequently amortized to costof revenue over the related assets' estimated useful life, which generally range from three to seven years. We expect that the amount of software development costs capitalized will be relatively consistent in the near-term as we continue making investments in innovation, quality, security and the integration of our solutions, which we believe will drive long-term revenue growth.

Current wording

Not included in research and development expense for the three months ended September 30, 2025 and 2024 were $12.1 million and $16.0 million, respectively, and for the nine months ended September 30, 2025 and 2024 were $38.9 million and $44.5 million, respectively, of qualifying costs associated with software development activities that are required to be capitalized under GAAP, such as those for our cloud solutions. Qualifying capitalized development costs associated with our cloud solutions are subsequently amortized to costof revenue over the related assets' estimated useful life, which generally range from three to seven years. We expect that the amount of software development costs capitalized will be relatively consistent in the near-term as we continue making investments in innovation, quality, security and the integration of our solutions, which we believe will drive long-term revenue growth.

Previous wording

General and administrative expense consists primarily of compensation costs for general corporate functions, including senior management, finance, accounting, legal, human resources and corporate development, Security Incident-related expenses (including legal fees, settlements and loss contingency accruals), third-party professional fees, insurance, allocated depreciation, facilities and IT support costs, acquisition-related expenses and other administrative expenses.

Current wording

General and administrative expense consists primarily of compensation costs for general corporate functions, including senior management, finance, accounting, legal, human resources and corporate development, Security Incident-related expenses (including legal fees, settlements and loss contingency accruals), third-party professional fees, insurance, allocated depreciation, facilities and IT support (including cybersecurity) costs, acquisition-related expenses and other administrative expenses.

Previous wording

General and administrative expense increased by $8.3 million, or 10.3%, during the six months ended June 30, 2025, when compared to the same period in 2024. The increases in dollars and as a percentage of revenue were primarily driven by the following:

Current wording

General and administrative expense increased by $3.5 million, or 12.8%, during the three months ended September 30, 2025, when compared to the same period in 2024. The increases in dollars and as a percentage of revenue were primarily driven by the following:

Previous wording

The increases in interest expense in dollars and as a percentage of total revenue during the three and six months ended June 30, 2025, when compared to the same periods in 2024, were primarily due to our incremental borrowings to fund stock repurchases during 2024 and 2025 and the expiration of favorable interest rate swaps in October 2024. We currently expect interest expense for the full year 2025 to be approximately $65 million to $69 million. Our interest expense in connection with the variable rate portion of our outstanding debt could increase in a rising interest rate environment. See Note 7 to our unaudited, condensed consolidated financial statements in this report for more information regarding our derivative instruments, which we use to manage our variable interest rate risk, and Item 3. Quantitative and Qualitative Disclosures about Market Risk: Interest Rate Risk (below) for more information about our variable interest rate exposure and related risk.

Current wording

The increases in interest expense in dollars and as a percentage of total revenue during the three and nine months ended September 30, 2025, when compared to the same periods in 2024, were primarily due to our incremental borrowings to fund stock repurchases during 2024 and 2025 and the expiration of favorable interest rate swaps in October 2024. We currently expect interest expense for the full year 2025 to be approximately $66 million to $70 million. Our interest expense in connection with the variable rate portion of our outstanding debt could increase in a rising interest rate environment. See Note 7 to our unaudited, condensed consolidated financial statements in this report for more information regarding our derivative instruments, which we use to manage our variable interest rate risk, and Item 3. Quantitative and Qualitative Disclosures about Market Risk: Interest Rate Risk (below) for more information about our variable interest rate exposure and related risk.

Previous wording

The decreases in other income, net in dollars and as a percentage of total revenue during the three and six months ended June 30, 2025, when compared to the same periods in 2024, were primarily due to increases in current year losses in currency revaluation compared to prior year losses. See Note 5 to our unaudited, condensed consolidated financial statements in this report for more information regarding our other income.

Current wording

During the three months ended September 30, 2025, other income, net was relatively consistent with the same period in 2024. The decrease in other income, net in dollars and as a percentage of total revenue during the nine months ended September 30, 2025, when compared to the same period in 2024, was primarily due to a decrease in interest income largely driven by lower year-over-year U.S. federal interest rates and, to a lesser extent, by an increase in the current year currency revaluation loss compared to the prior year loss. See Note 5 to our unaudited, condensed consolidated financial statements in this report for more information regarding our other income.

Previous wording

The increase in deferred revenue during the six months ended June 30, 2025 was primarily due toa seasonal increase in customer contract billings. Historically, due to the timing of customer budget cycles, we have an increase in billings and customer contract renewals at or near the beginning of our third quarter. Generally, our lowest balance of deferred revenue during the year is at the end of our first quarter.

Current wording

The increase in deferred revenue during the nine months ended September 30, 2025 was primarily due toa seasonal increase in customer contract billings. Historically, due to the timing of customer budget cycles, we have an increase in billings and customer contract renewals at or near the beginning of our third quarter. Generally, our lowest balance of deferred revenue during the year is at the end of our first quarter.

Previous wording

The increases in our effective income tax rate for the three and six months ended June 30, 2025 when compared to the same periods in 2024 were primarily due to the unfavorable impact of a valuation allowance recorded against our net U.S. deferred tax assets.

Current wording

The decreases in our effective income tax rate for the three and nine months ended September 30, 2025 when compared to the same periods in 2024 were primarily due to the favorable impact of a valuation allowance reduction recorded against our net U.S. deferred tax assets.

Previous wording

(2)Includes charges of $24.3 million incurred during the six months ended June 30, 2025 related to the release from our lease for office space in Washington, DC (which was acquired as part of our acquisition of EVERFI in December 2021).

Current wording

(2)Includes charges of $24.3 million incurred during the nine months ended September 30, 2025 related to the release from our lease for office space in Washington, DC (which was acquired as part of our acquisition of EVERFI in December 2021).

Previous wording

(3)Includes Security Incident-related costs incurred during the three months ended June 30, 2025 which were insignificant for on-going legal fees, during the six months ended June 30, 2025 of $2.6 million, which included approximately $1.1 million in aggregate accruals for loss contingencies and during the three and six months ended June 30, 2024 of $1.8 million and $12.1 million, respectively, which included approximately $0.0 million and $7.0 million, respectively, in aggregate accruals for loss contingencies. Recorded expenses consisted primarily of payments to third-party service providers and consultants, including legal fees, as well as settlements of customer claims, negotiated settlements and accruals for certain loss contingencies. Not included in this adjustment were costs associated with enhancements to our cybersecurity program. As of June 30, 2025, we have recorded approximately $1.6 million in aggregate liabilities for loss contingencies that we believed we could reasonably estimate in accordance with our loss contingency procedures. Our liabilities for loss contingencies are recorded in accrued expenses and other current liabilities on our unaudited, condensed consolidated balance sheets. It is reasonably possible that our estimated actual losses may change in the near term for those matters, but we believe that they are not reasonably likely, either separately or in the aggregate, to have a material adverse impact on our results of operations, cash flows or financial condition.

Current wording

(3)Includes Security Incident-related costs incurred during the three months ended September 30, 2025 and 2024 which were insignificant for on-going legal fees, during the nine months ended September 30, 2025 of $2.8 million, which included approximately $1.1 million in recorded accruals for loss contingencies and during the nine months ended September 30, 2024 of $12.8 million, which included approximately $6.8 million in recorded accruals for loss contingencies. Recorded expenses consisted primarily of payments to third-party service providers and consultants, including legal fees, as well as settlements of customer claims, negotiated settlements and accruals for certain loss contingencies. Not included in this adjustment were costs associated with enhancements to our cybersecurity program. As of September 30, 2025, we do not have any recorded liabilities for loss contingencies related to the Security Incident.

Previous wording

At June 30, 2025, our total cash and cash equivalents balance included approximately $20.7 million of cash that was held by operations outside the U.S. While these funds may not be needed to fund our U.S. operations for at least the next twelve months, if we need these funds, we may be required to accrue and pay taxes to repatriate the funds. We currently do not intend nor anticipate a need to repatriate our cash held outside the U.S.

Current wording

At September 30, 2025, our total cash and cash equivalents balance included approximately $17.9 million of cash that was held by operations outside the U.S. While these funds may not be needed to fund our U.S. operations for at least the next twelve months, if we need these funds, we may be required to accrue and pay taxes to repatriate the funds. We currently do not intend nor anticipate a need to repatriate our cash held outside the U.S.

Previous wording

Net cash provided by operating activities decreased by $50.1 million during the six months ended June 30, 2025, when compared to the same period in 2024, primarily due to a $9.5 million decrease in net income adjusted for non-cash expenses and a $40.6 million decrease in cash flow from operations associated with working capital.

Current wording

Net cash provided by operating activities decreased by $14.8 million during the nine months ended September 30, 2025, when compared to the same period in 2024, primarily due to a $2.8 million decrease in net income adjusted for non-cash expenses and a $12.1 million decrease in cash flow from operations associated with working capital.

Previous wording

The decrease in cash flow from operations associated with working capital during the six months ended June 30, 2025, when compared to the same period in 2024, was primarily due to:

Current wording

The decrease in cash flow from operations associated with working capital during the nine months ended September 30, 2025, when compared to the same period in 2024, was primarily due to:

Previous wording

•fluctuations in the timing of vendor payments; and

Current wording

•fluctuations in the timing of vendor payments; offset by

Previous wording

Net cash used in investing activities of $41.3 million remained relatively consistent during the six months ended June 30, 2025, when compared to the same period in 2024.

Current wording

Net cash used in investing activities of $57.3 million remained relatively consistent during the nine months ended September 30, 2025, when compared to the same period in 2024.

Previous wording

During the six months ended June 30, 2025, we used cash of $27.8 million for software development costs, which was relatively consistent with cash spent during the same period in 2024. We spent $1.3 million for purchases of property and equipment during the six months ended June 30, 2025, which was a decrease of $4.8 million when compared to the same period in 2024. During the six months ended June 30, 2025, we used net cash of $12.2 million for the disposition of a business compared to $1.2 million used during the same period in 2024.

Current wording

During the nine months ended September 30, 2025, we used cash of $40.3 million for software development costs, which was a decrease of $2.6 million when compared to the same period in 2024. We spent $4.8 million for purchases of property and equipment during the nine months ended September 30, 2025, which was a decrease of $2.4 million when compared to the same period in 2024. During the nine months ended September 30, 2025, we used net cash of $12.2 million for the disposition of a business compared to $1.2 million used during the same period in 2024.

Previous wording

During the six months ended June 30, 2025, we had a net increase in borrowings of $84.6 million, primarily due to our stock repurchase program and to satisfy tax obligations of employees upon settlement of equity awards (see discussion below).

Current wording

During the nine months ended September 30, 2025, we had a net decrease in borrowings of $9.9 million, primarily due to our stock repurchase program and to satisfy tax obligations of employees upon settlement of equity awards (see discussion below).

Previous wording

We paid $38.7 million to satisfy tax obligations of employees upon settlement of equity awards during the six months ended June 30, 2025 compared to $54.5 million during the same period in 2024. The amount of taxes paid by us on behalf of employees related to the settlement of equity awards varies from period to period based upon the timing of grants and vesting, as well as the market price for shares of our common stock at the time of settlement. Most of our equity awards currently vest in our first quarter.

Current wording

We paid $39.7 million to satisfy tax obligations of employees upon settlement of equity awards during the nine months ended September 30, 2025 compared to $56.0 million during the same period in 2024. The amount of taxes paid by us on behalf of employees related to the settlement of equity awards varies from period to period based upon the timing of grants and vesting, as well as the market price for shares of our common stock at the time of settlement. Most of our equity awards currently vest in our first quarter.

Previous wording

During the six months ended June 30, 2025, cash flow from financing activities associated with changes in restricted cash due to customers increased $128.6 million, compared to an increase of $106.9 million during the same period in 2024. This line in the statement of cash flows represents the change in the amount of restricted cash held and payable by us to customers from one period to the next. This restricted cash due to customers is not available to us for operational purposes.

Current wording

During the nine months ended September 30, 2025, cash flow from financing activities associated with changes in restricted cash due to customers decreased $323.5 million, compared to a decrease of $263.7 million during the same period in 2024. This line in the statement of cash flows represents the change in the amount of restricted cash held and payable by us to customers from one period to the next. This restricted cash due to customers is not available to us for operational purposes.

Previous wording

Historically, we have drawn on our credit facility from time to time to help us meet financial needs, primarily due to the seasonality of our cash flows from operations and financing for business acquisitions. At June 30, 2025, our available borrowing capacity under the 2024 Credit Facilities was $374.3 million. The 2024 Credit Facilities mature in April 2029.

Current wording

Historically, we have drawn on our credit facility from time to time to help us meet financial needs, primarily due to the seasonality of our cash flows from operations and financing for business acquisitions. At September 30, 2025, our available borrowing capacity under the 2024 Credit Facilities was $463.5 million. The 2024 Credit Facilities mature in April 2029.

Previous wording

At June 30, 2025, the carrying amount of our debt under the 2024 Credit Facilities was $1.1 billion. Our average daily borrowings during the three and six months ended June 30, 2025 were $1.1 billion and $1.1 billion, respectively.

Current wording

At September 30, 2025, the carrying amount of our debt under the 2024 Credit Facilities was $1.0 billion. Our average daily borrowings during the three and nine months ended September 30, 2025 were $1.0 billion and $1.1 billion, respectively.

Previous wording

As of June 30, 2025, we had total remaining principal payments of approximately $1.2 billion. These payments represent principal payments only, under the following assumptions: (i) that the amounts outstanding under the 2024 Credit Facilities, our real estate loans and our other debt at June 30, 2025 will remain outstanding until maturity, with minimum payments occurring as currently scheduled, and (ii) that there are no assumed future borrowings on the revolving credit loans under the 2024 Revolving Facility for the purposes of determining minimum commitment amounts. See Note 6 to our unaudited, condensed consolidated financial statements in this report for more information.

Current wording

As of September 30, 2025, we had total remaining principal payments of approximately $1.1 billion. These payments represent principal payments only, under the following assumptions: (i) that the amounts outstanding under the 2024 Credit Facilities, our real estate loans and our other debt at September 30, 2025 will remain outstanding until maturity, with minimum payments occurring as currently scheduled, and (ii) that there are no assumed future borrowings on the revolving credit loans under the 2024 Revolving Facility for the purposes of determining minimum commitment amounts. See Note 6 to our unaudited, condensed consolidated financial statements in this report for more information.

Previous wording

In addition to principal payments, as of June 30, 2025, we expect to pay interest expense over the life of our debt obligations of approximately $274.9 million. These payments represent our estimated future interest payments on debt using our debt balances and the related weighted average effective interest rates as of June 30, 2025, which includes the effect of interest rate swap agreements. The actual interest expense recognized in our unaudited, condensed consolidated statements of comprehensive income will depend on the amount of debt, the length of time the debt is outstanding and the interest rate, which could be different from our assumptions on our remaining principal payments described above.

Current wording

In addition to principal payments, as of September 30, 2025, we expect to pay interest expense over the life of our debt obligations of approximately $230.0 million. These payments represent our estimated future interest payments on debt using our debt balances and the related weighted average effective interest rates as of September 30, 2025, which includes the effect of interest rate swap agreements. The actual interest expense recognized in our unaudited, condensed consolidated statements of comprehensive income will depend on the amount of debt, the length of time the debt is outstanding and the interest rate, which could be different from our assumptions on our remaining principal payments described above.

Previous wording

As of June 30, 2025, we had remaining operating lease payments of $8.1 million. These payments have not been reduced by sublease income, incentive payments, reimbursement of leasehold improvements or the amount representing imputed interest which was $1.1 million. Our operating leases are generally for corporate offices, subleased offices and certain equipment and furniture. Given our remote-first workforce strategy and real estate footprint optimization efforts, we do not anticipate entering any new, material operating leases for offices for the foreseeable future. See Note 8 to our unaud ited, condensed consolidated financial statements in this report for more information.

Current wording

As of September 30, 2025, we had remaining operating lease payments of $7.6 million. These payments have not been reduced by sublease income, incentive payments, reimbursement of leasehold improvements or the amount representing imputed interest which was insignificant. Our operating leases are generally for corporate offices, subleased offices and certain equipment and furniture. Given our remote-first workforce strategy and real estate footprint optimization efforts, we do not anticipate entering any new, material operating leases for offices for the foreseeable future. See Note 8 to our unaud ited, condensed consolidated financial statements in this report for more information.