WORKIVA INC
For the period ended Mar 31, 2025. Filed May 1, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2025 · Filed May 1, 2025
WK$72.76-14.9%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-09-30; filed 2024-11-06.
0001445305-24-000143
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-03-31; filed 2025-05-01.
0001445305-25-000091
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 101 previous paragraphs and 88 current paragraphs.
55 unchanged; 29 reworded; 4 added; 16 removed; 1 previous and 0 current paragraphs rearranged.
Tables are not compared: 11 previous and 11 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (4)
Current report
Effects of Policy Uncertainty on Sales of Sustainability Solutions
Current report
Sales of our sustainability management solutions, including Workiva Carbon, could be materially impacted by domestic and global policy uncertainties. Risks relating to shifts in regulatory priorities and newly emerging trends due to changes in the U.S. presidential administration, and the outcome of other global elections, and risks relating to legal challenges to sustainability-related rules and regulations, may affect our market expansion opportunities in the U.S. and abroad. For example, amendments to the European Union’s Corporate Sustainability Reporting Directive (“CSRD”) standards used to identify and collect the information and data, with different implementation dates depending on the company size and geographic location, are still developing and uncertain. That regulatory uncertainty has limited or delayed compliance obligations or requirements, could slow market adoption and may reduce or delay the growth of our sustainability solutions. The extent of this policy uncertainty, and its potential impact on our growth trajectory, cannot be accurately predicted.
Current report
Cash used in investing activities of $9.1 million for the three months ended March 31, 2025 consisted of $103.0 million in purchases of marketable securities and $0.8 million in purchases of fixed assets partially offset by $94.6 million from the maturities of marketable securities. Our capital expenditures were associated primarily with computer equipment in support of expanding our infrastructure and work force.
Current report
Cash used in financing activities of $1.3 million for the three months ended March 31, 2024 consisted of $8.6 million in taxes paid related to net share settlements of stock-based compensation awards partially offset by $7.1 million in proceeds from shares issued in connection with our ESPP and $0.3 million in proceeds from option exercises.
Removed paragraphs (16)
Previous report
Recent Business Developments
Previous report
On June 17, 2024, we acquired all of the issued and outstanding equity interests in Sustain.Life, a leading provider of carbon accounting solutions, to launch Workiva Carbon. Workiva Carbon is an audit-ready carbon accounting solution that helps organizations measure, manage, track, and report carbon emissions, including data from third-party supply chain partners. Coupled with Workiva's ESG reporting solution, companies can now collect key business data, calculate critical metrics, set data-driven ESG strategy, measure progress, and report results all in the Workiva platform. See Note 11 to the condensed consolidated financial statements for more information.
Previous report
Cost of revenue increased $10.0 million during the nine months ended September 30, 2024 compared to the same period a year ago. Subscription and support cost of revenue increased $12.4 million due primarily to $8.4 million in higher cash-based compensation and benefits costs, $2.0 million of additional stock-based compensation, and a $0.5 million increase in travel expense. The increase in compensation was primarily driven by a modest increase in employee headcount. The increase in travel expense was primarily due to a general increase in travel driven by an increase in employee headcount. Amortization of acquired intangible assets for Sustain.Life was $0.6 million. Professional services cost of revenue decreased $2.4 million due primarily to a $2.1 million decrease in cash-based compensation and benefits costs and a $0.7 million decrease in professional service fees. The decrease was primarily driven by a decrease in employee headcount and staff augmentation as we continue to transition consulting and other services to our partners.
Previous report
Operating Expenses
Previous report
Research and development expenses increased $12.1 million during the nine months ended September 30, 2024 compared to the same period a year ago due primarily to $8.1 million in higher cash-based compensation and benefits, $1.8 million of additional stock-based compensation, and a $2.1 million increase in professional service fees. The remaining increase in compensation was primarily driven by a modest increase in employee headcount. The increase in professional service fees resulted primarily from our continued investment in and support of our platform and solutions.
Previous report
Sales and marketing expenses increased $41.9 million during the nine months ended September 30, 2024 compared to the same period a year ago due primarily to $24.3 million in higher cash-based compensation and benefits, $5.7 million of additional stock-based compensation, a $4.1 million increase in travel expense, a $3.6 million increase in professional service fees, and a $3.5 million increase in marketing and advertising. The increase in compensation was primarily due to an increase in employee headcount and sales commissions as we continue to invest in our go-to-market activities. The increase in travel expense was primarily due to a general increase in travel driven by an increase in employee headcount and our continued investment in our go-to-market activities. The increases in professional service fees and marketing and advertising were the result of our continued investment in and support of our platform and solutions.
Previous report
General and administrative expenses decreased $10.4 million during the nine months ended September 30, 2024 compared to the same period a year ago due primarily to a $12.2 million decrease in stock-based compensation partially offset by a $2.0 million increase in professional service fees. In addition, during the nine months ended September 30, 2023, we recorded a one-time benefit of $1.0 million related to a goods and services tax refund as well as one-time fees of $0.6 million related to the cancellation of certain events which did not recur in 2024. The decrease in compensation during the first nine months of 2024 is primarily due to the recognition of $1.4 million and $18.1 million in cash-based and stock-based compensation, respectively, pursuant to certain transition agreements with former executives during the first quarter of 2023 which did not recur in 2024, partially offset by a modest increase in employee headcount and an increase in performance-based restricted stock expense driven by additional performance-based restricted stock awards issued to executives in the latter part of the first quarter of 2024 and changes in the assumptions associated with the attainment of company-specific performance targets. The increase in professional service fees was primarily due to costs incurred to acquire Sustain.Life.
Previous report
During the nine months ended September 30, 2024, interest income increased $14.5 million compared to the same period a year ago due primarily to an increase in our investment balance, facilitated by the issuance of our 2028 convertible notes (the "2028 Notes"), coupled with higher interest rates. During the nine months ended September 30, 2023, we recorded a $45.1 million loss on induced conversion from the partial repurchase of our 2026 Notes, which did not recur in 2024 and contributed primarily to the decrease in interest expense compared to the same period a year ago. Other expense, net decreased $1.1 million compared to the same period a year ago due primarily to gains on foreign currency transactions as well as losses on the sale of available-for-sale securities from the first nine months of 2023 which did not recur in 2024.
Previous report
Cash provided by operating activities of $15.0 million for the three months ended September 30, 2023 consisted of a net loss of $56.3 million adjusted for non-cash charges of $65.7 million and net cash inflows of $5.5 million from changes in operating assets and liabilities. The adjustments for non-cash charges included a $45.1 million loss on induced conversion from the partial repurchase of our 2026 Notes. Customer growth and contract renewals for longer terms accounted for most of the increase in deferred revenue. Deferred costs decreased primarily due to the amortization of direct and incremental costs of obtaining a customer contract. The increases in accounts receivable, other receivables, and accrued expenses and other liabilities as well as the decreases in prepaid expenses and other assets were attributable primarily to the timing of our billings, cash collections, and cash payments.
Previous report
Cash provided by operating activities of $46.5 million for the nine months ended September 30, 2023 consisted of a net loss of $123.3 million adjusted for non-cash charges of $128.9 million and net cash inflows of $41.0 million from changes in operating assets and liabilities. Customer growth accounted for most of the increase in deferred revenue. Deferred costs decreased primarily due to the amortization of direct and incremental costs of obtaining a customer contract. The increases in other receivables, prepaid expenses, and accrued expenses and other liabilities as well as the decreases in accounts receivable and accounts payable were attributable primarily to the timing of our billings, cash collections, and cash payments.
Previous report
Cash used in investing activities of $49.6 million for the three months ended September 30, 2024 consisted of $158.5 million in purchases of marketable securities and $0.2 million for the acquisition of Sustain.Life partially offset by $109.0 million from the maturities of marketable securities.
Previous report
Cash used in investing activities of $109.0 million for the three months ended September 30, 2023 consisted of $145.0 million in purchases of marketable securities and $0.9 million in purchases of fixed assets partially offset by $36.9 million from the maturities of marketable securities. Our capital expenditures were associated primarily with computer equipment in support of expanding our infrastructure and work force.
Previous report
Cash used in investing activities of $182.0 million for the nine months ended September 30, 2023 consisted of $322.0 million in purchases of marketable securities and $1.7 million in purchases of fixed assets partially offset by $65.1 million from the sale of marketable securities and $76.8 million from the maturities of marketable securities. Our capital expenditures were associated primarily with computer equipment in support of expanding our infrastructure and work force.
Previous report
Cash provided by financing activities of $301.2 million for the three months ended September 30, 2023 consisted of $691.1 million in proceeds from the issuance of the 2028 Notes, net of issuance costs, $7.0 million in proceeds from shares issued in connection with our ESPP, and $1.1 million in proceeds from option exercises partially offset by $396.9 million paid for the partial repurchase of our 2026 Notes and $1.0 million in taxes paid related to net share settlements of stock-based compensation awards.
Previous report
Cash provided by financing activities of $5.9 million for the nine months ended September 30, 2024 consisted of $13.8 million in proceeds from shares issued in connection with our ESPP and $3.9 million in proceeds from option exercises partially offset by $11.4 million in taxes paid related to net share settlements of stock-based compensation awards.
Previous report
Cash provided by financing activities of $300.3 million for the nine months ended September 30, 2023 consisted of $691.1 million in proceeds from the issuance of the 2028 Notes, net of issuance costs, $12.5 million in proceeds from shares issued in connection with our ESPP, and $3.3 million in proceeds from option exercises partially offset by $396.9 million paid for the partial repurchase of our 2026 Notes and $9.4 million in taxes paid related to net share settlements of stock-based compensation awards.
Reworded paragraphs (29)
Previous wording
Workiva is on a mission to power transparent reporting for a better world. We build and deliver the world's leading cloud platform for assured integrated reporting to meet stakeholder demands for action, transparency, and disclosure of financial and non-financial data. Workiva offers the only unified software-as-a-service (“SaaS”) platform brings customers’ financial reporting, Governance, Risk, and Compliance (“GRC”) and Environmental, Social, and Governance (“ESG”) data together in a controlled, secure, audit-ready platform. Our platform simplifies the most complex reporting and disclosure challenges by streamlining processes, connecting data and teams, and ensuring consistency.
Current wording
The Workiva platform is built for transparency, accountability, and trust. We believe that all stakeholders, including consumers, employees, shareholders, and regulators expect more from business – more action, transparency, and disclosure of financial and non-financial information. We build solutions to meet that demand and streamline processes, connect data and teams, and ensure consistency – all within the Workiva platform. Our leading unified software-as-a-service (“SaaS”) platform brings customers’ financial reporting, sustainability management, and Governance, Risk, and Compliance (“GRC”) together in a controlled, secure, audit-ready platform.
Previous wording
Workiva provides more than 6,200 organizations across the globe with SaaS platform solutions to help solve some of the most complex reporting and disclosure challenges. While our customers use our platform for more than 100 different use cases, across dozens of vertical industries, we organize our sales and marketing resources into three purpose-built solution groups (Financial Reporting, ESG, and GRC) focusing primarily on the office of the Chief Financial Officer (“CFO”), Chief Sustainability Officer (“CSO”), and Chief Audit Executive (“CAE”).
Current wording
Workiva provides more than 6,300 organizations across the globe with SaaS platform solutions to help solve some of the most complex reporting and disclosure challenges. While our customers use our platform for more than 100 different use cases, across dozens of vertical industries, we organize our sales and marketing resources into three purpose-built solution groups (financial reporting, sustainability management, and GRC) focusing primarily on the office of the Chief Financial Officer (“CFO”), Chief Sustainability Officer (“CSO”), and Chief Audit Executive (“CAE”).
Previous wording
We continue to invest in the development of our solutions, infrastructure and sales and marketing to drive long-term growth. Our full-time employee headcount expanded to 2,751 at September 30, 2024 from 2,519 at September 30, 2023, an increase of 9.2%.
Current wording
We continue to invest in the development of our solutions, infrastructure and sales and marketing to drive long-term growth. Our full-time employee headcount expanded to 2,873 at March 31, 2025 from 2,561 at March 31, 2024, an increase of 12.2%.
Previous wording
We have achieved significant revenue growth in recent periods. Our revenue grew to $185.6 million and $538.8 million during the three and nine months ended September 30, 2024, respectively from $158.2 million and $463.4 million during the three and nine months ended September 30, 2023, respectively. We incurred net losses of $17.0 million and $46.2 million during the three and nine months ended September 30, 2024, respectively compared to $56.3 million and $123.3 million during the three and nine months ended September 30, 2023, respectively.
Current wording
We have achieved significant revenue growth in recent periods. Our revenue grew to $206.3 million during the three months ended March 31, 2025 from $175.7 million during the three months ended March 31, 2024. We incurred net losses of $21.4 million during the three months ended March 31, 2025 compared to $11.7 million during the three months ended March 31, 2024.
Previous wording
In the United States, volatility in the public markets has led to a decrease in the number of initial public offerings (“IPOs”) and special-purpose acquisition companies (“SPACs”) since fiscal year 2022. New sales of our SEC and capital markets solutions were adversely affected by this decline in the IPO and SPAC markets. We expect reduced valuation multiples caused by higher interest rates, inflation, and geopolitical instability to continue to negatively impact the number of IPOs and SPACs in fiscal year 2024. Whether and to what extent the IPO and SPAC markets will moderate cannot be accurately predicted.
Current wording
In the U.S., volatility in the public markets led to a decrease in the number of initial public offerings (“IPOs”) and special-purpose acquisition companies (“SPACs”) since fiscal 2022. New sales of our SEC and capital markets solutions were adversely affected by this decline in the IPO and SPAC markets. We expect reduced valuation multiples caused by higher interest rates, inflation, global trade conflicts, and geopolitical instability to create an uncertain impact on the number of IPOs in fiscal year 2025. Whether and to what extent the IPO and SPAC markets will moderate cannot be accurately predicted.
Previous wording
Pursue New Customers. We sell to organizations that manage large, complex processes with distributed teams of contributors and disparate sets of business data. We market our platform to professionals and executives in the areas of financial and non-financial reporting, including regulatory, multi-entity and performance reporting. In addition, we market to teams responsible for ESG reporting, and GRC programs. We intend to continue to build our sales and marketing organization and leverage our brand equity to attract new customers.
Current wording
Pursue New Customers. We sell to organizations that manage large, complex processes with distributed teams of contributors and disparate sets of business data. We market our platform to professionals and executives in the areas of financial and non-financial reporting, including regulatory, multi-entity and performance reporting. In addition, we market to teams responsible for sustainability management and GRC programs. We intend to continue to build our sales and marketing organization and leverage our brand equity to attract new customers.
Previous wording
Total customers. We believe total number of customers is a key indicator of our financial success and future revenue potential. We define a customer as an entity with an active subscription contract as of the measurement date. Our customer is typically a parent company or, in a few cases, a significant subsidiary that works with us directly. Companies with publicly-listed securities account for a substantial majority of our customers. Our customer count as of September 30, 2024 does not include Sustain.Life.
Current wording
Total customers. We believe total number of customers is a key indicator of our financial success and future revenue potential. We define a customer as an entity with an active subscription contract as of the measurement date. Our customer is typically a parent company or, in a few cases, a significant subsidiary that works with us directly. Companies with publicly-listed securities account for a substantial majority of our customers. As customers acquired through our Sustain.Life acquisition in 2024 renew their contracts with Workiva, they are added to our customer count above.
Previous wording
Subscription and support revenue retention rate. We calculate our subscription and support revenue retention rate based on all customers that were active at the end of the same calendar quarter of the prior year (“base customers”). We begin by annualizing the subscription and support revenue recorded in the same calendar quarter of the prior year for those base customers who are still active at the end of the current quarter. We divide the result by the annualized subscription and support revenue in the same quarter of the prior year for all base customers.
Current wording
Gross retention rate. Our gross retention rate is based on subscription and support revenue. We calculate our gross retention rate based on all customers that were active at the end of the same calendar quarter of the prior year (“base customers”). We begin by annualizing the subscription and support revenue recorded in the same calendar quarter of the prior year for those base customers who are still active at the end of the current quarter. We divide the result by the annualized subscription and support revenue in the same quarter of the prior year for all base customers. We believe gross retention rates are an important metric to track how the Company retains its base revenue for each year.
Previous wording
Our subscription and support revenue retention rate was 97.5% as of September 30, 2024, down slightly from 97.7% as of September 30, 2023. We believe that our success in maintaining a high rate of revenue retention is attributable primarily to our robust technology platform and strong customer service. Customers whose securities were deregistered due to merger or acquisition or financial distress accounted for over half of our revenue attrition in the latest quarter.
Current wording
Our gross retention rate was 97.3% as of March 31, 2025, down slightly from 97.8% as of March 31, 2024. We believe that our success in maintaining a high rate of revenue retention is attributable primarily to our robust technology platform and strong customer service. Customers whose securities were deregistered due to merger or acquisition or financial distress accounted for over half of our revenue attrition in the latest quarter.
Previous wording
Subscription and support revenue retention rate including add-ons. Add-on revenue includes the change in both solutions and pricing for existing customers. We calculate our subscription and support revenue retention rate including add-ons by annualizing the subscription and support revenue recorded in the current quarter for our base customers that were active at the end of the current quarter. We divide the result by the annualized subscription and support revenue in the same quarter of the prior year for all base customers.
Current wording
Net retention rate. Our net retention rate is based on subscription and support revenue, and includes revenue from up-selling or cross-selling additional solutions, and pricing changes for existing customers and securing multi-year contract renewals containing periodic pricing term increases. We calculate our net retention rate by annualizing the subscription and support revenue recorded in the current quarter for our base customers that were active at the end of the current quarter. We divide the result by the annualized subscription and support revenue in the same quarter of the prior year for all base customers. We believe our net retention rate is an important metric to measure the long-term value of customer agreements and our ability to retain our customers.
Previous wording
Our subscription and support revenue retention rate including add-ons was 110.5% as of the quarter ended September 30, 2024, down from 112.0% as of September 30, 2023.
Current wording
Our net retention rate including add-ons was 110.1% as of the quarter ended March 31, 2025, down slightly from 110.6% as of March 31, 2024.
Previous wording
Annual contract value. Our annual contract value (“ACV”) for each customer is calculated by annualizing the subscription and support revenue recognized during each quarter. We believe the increase in the number of larger contracts shows our progress in expanding our customers’ adoption of our platform.
Current wording
Annual contract value. Our annual contract value (“ACV”) for each customer is calculated by annualizing the subscription and support revenue recognized during each quarter. We believe the increase in the number of larger contracts shows our progress in expanding our customers’ adoption of our platform. As customers acquired through our Sustain.Life acquisition in 2024 renew their contracts with Workiva, they are incorporated into our ACV metrics in the following table.
Previous wording
We generate revenue through the sale of subscriptions to our cloud-based software and the delivery of professional services. We serve a wide range of customers in many industries, and our revenue is not concentrated with any single customer or small group of customers. For the nine months ended September 30, 2024 and 2023, no single customer represented more than 1% of our revenue, and our largest 10 customers accounted for less than 10% of our revenue in the aggregate.
Current wording
We generate revenue through the sale of subscriptions to our cloud-based software and the delivery of professional services. We serve a wide range of customers in many industries, and our revenue is not concentrated with any single customer or small group of customers. For the three months ended March 31, 2025 and 2024, no single customer represented more than 1% of our revenue, and our largest 10 customers accounted for less than 10% of our revenue in the aggregate.
Previous wording
Comparison of Three and Nine Months Ended September 30, 2024 and 2023
Current wording
Comparison of Three Months Ended March 31, 2025 and 2024
Previous wording
Total revenue increased $27.4 million for the three months ended September 30, 2024 compared to the same quarter a year ago due primarily to a $27.6 million increase in subscription and support revenue. Growth in subscription and support revenue in the third quarter was attributable mainly to strong demand and continued solution expansion across our customer base. Revenue from professional services was relatively flat for the three months ended September 30, 2024 compared to the same quarter a year ago. We continue to transition consulting and other services to our partners and expect the revenue growth rate from subscription and support to continue to outpace revenue growth from professional services on an annual basis.
Current wording
Total revenue increased $30.6 million for the three months ended March 31, 2025 compared tothe same quarter a year ago due primarily to a $30.5 million increase in subscription and support revenue. Growth in subscription and support revenue in the first quarter was attributable mainly to strong demand and continued solution expansion across our customer base. Revenue from professional services was relatively flat for the three months ended March 31, 2025 compared to the same quarter a year ago. We continue to transition consulting and other services to our partners and expect the revenue growth rate from subscription and support to continue to outpace revenue growth from professional services on an annual basis.
Previous wording
Cost of revenue increased $5.3 million during the three months ended September 30, 2024 compared to the same quarter a year ago. Subscription and support cost of revenue increased $5.8 million due primarily to $3.5 million in higher cash-based compensation and benefits costs and $0.9 million of additional stock-based compensation. The increase in compensation was primarily driven by a modest increase in employee headcount. Amortization of acquired intangible assets for Sustain.Life was $0.6 million. Professional services cost of revenue decreased $0.4 million due primarily to a $0.5 million decrease in cash-based compensation and benefits costs. The decrease was primarily driven by a decrease in employee headcount as we continue to transition consulting and other services to our partners.
Current wording
Cost of revenue increased $6.8 million during the three months ended March 31, 2025 compared to the same quarter a year ago. Subscription and support cost of revenue increased $6.1 million due primarily to $4.1 million in higher cash-based compensation and benefits costs, $0.8 million of additional stock-based compensation, and a $0.5 million increase in the cost of licensed platform content. The increase in compensation was primarily driven by an increase in employee headcount. The cost of licensed platform content increased primarily from our continued investment in and support of our platform and solutions. Amortization of acquired intangible assets for Sustain.Life was $0.5 million. Professional services cost of revenue increased $0.7 million due primarily to a $0.5 million increase in cash-based compensation and benefits costs driven by a slight increase in headcount.
Previous wording
Research and development expenses increased $6.7 million during the three months ended September 30, 2024 compared to the same quarter a year ago due primarily to $4.0 million in higher cash-based compensation and benefits, $1.5 million of additional stock-based compensation and a $1.0 million increase in professional service fees The increase in compensation was primarily driven by a modest increase in employee headcount. The increase in professional service fees resulted primarily from our continued investment in and support of our platform and solutions.
Current wording
Research and development expenses increased $8.3 million during the three months ended March 31, 2025 compared to the same quarter a year ago due primarily to $5.4 million in higher cash-based compensation and benefits, $1.4 million of additional stock-based compensation, a $0.7 million increase in professional service fees, and a $0.6 million increase in internal event costs. The increase in compensation was primarily driven by an increase in employee headcount. The increase in professional service fees resulted primarily from our continued investment in and support of our platform and solutions. The increase in internal event costs relate to our annual research and development event which spanned the first quarter and second quarter of 2025 but was held in the second quarter of 2024.
Previous wording
Sales and marketing expenses increased $17.2 million during the three months ended September 30, 2024 compared to the same quarter a year ago due primarily to $8.0 million in higher cash-based compensation and benefits, $2.8 million of additional stock-based compensation, a $1.9 million increase in travel expense, a $1.7 million increase in professional service fees, and a $2.5 million increase in marketing and advertising. During the third quarter of 2024 we recognized an additional $1.8 million in cash-based and stock-based compensation pursuant to certain severance obligations. The remaining increase in compensation was primarily due to an increase in employee headcount as we continue to invest in our go-to-market activities. The increase in travel expense was primarily due to a general increase in travel driven by an increase in employee headcount and our continued investment in our go-to-market activities. The increases in professional service fees and marketing and advertising was the result of our continued investment in and support of our platform and solutions.
Current wording
Sales and marketing expenses increased $19.0 million during the three months ended March 31, 2025 compared to the same quarter a year ago due primarily to $13.2 million in higher cash-based compensation and benefits, $1.7 million of additional stock-based compensation, a $0.8 million increase in travel expense, a $1.2 million increase in internal event costs, a $1.0 million increase in marketing and advertising, and a $0.6 million increase in professional service fees. During the first quarter of 2025 we recognized an additional $0.7 million in cash-based and stock-based compensation pursuant to certain severance obligations. The increases in compensation, travel, internal event costs and marketing and advertising were primarily due to an increase in employee headcount and our continued investment in our go-to-market activities. The increase in professional service fees was the result of our continued investment in and support of our platform and solutions.
Previous wording
General and administrative expenses increased $4.5 million during the three months ended September 30, 2024 compared to the same quarter a year ago due primarily to a $0.9 million increase in cash-based compensation and benefits, $2.6 million of additional stock-based compensation, and a $0.8 million increase in recruiting and professional service fees. The increase in compensation was primarily due to additional performance-based restricted stock awards issued to executives in the latter part of the first quarter of 2024 and changes in the assumptions associated with the attainment of company-specific performance targets. The remaining increase in compensation was due to a modest increase in employee headcount. The increase in professional service fees was primarily due to costs incurred to acquire Sustain.Life.
Current wording
General and administrative expenses increased $2.9 million during the three months ended March 31, 2025 compared to the same quarter a year ago due primarily to a $1.4 million increase in cash-based compensation and benefits, $0.7 million of additional stock-based compensation, and a $0.3 million increase in professional service fees. The increase in stock-based compensation was primarily due to performance-based restricted stock awards and changes in the assumptions associated with the attainment of company-specific performance targets. The remaining increase in compensation was due to a modest increase in employee headcount.
Previous wording
Interest Income, Interest Expense and Other Expense, Net
Current wording
Interest Income, Interest Expense, and Other (Expense) Income, Net
Previous wording
During the three months ended September 30, 2024, interest income increased $2.0 million compared to the same quarter a year ago due primarily to an increase in our investment balance, coupled with higher interest rates. During the three months ended September 30, 2023, we recorded a $45.1 million loss on induced conversion from the partial repurchase of our convertible senior notes due in 2026 (the "2026 Notes"), which did not recur in 2024 and contributed primarily to the decrease in interest expense compared to the same quarter a year ago. Other expense, net increased $0.3 million compared to the same quarter a year ago due primarily to losses on foreign currency transactions.
Current wording
During the three months ended March 31, 2025, interest income decreased $1.7 million compared to the same quarter a year ago due primarily to a decrease in our investment balance, coupled with lower interest rates. Interest expense remained relatively flat compared to the same quarter a year ago. Other expense, net increased $0.3 million compared to the same quarter a year ago due primarily to losses on foreign currency transactions.
Previous wording
As of September 30, 2024, our principal sources of liquidity were cash, cash equivalents and marketable securities totaling $776.4 million, which were held for working capital purposes. We have financed our operations primarily through cash generated from operations and issuances of convertible debt. We have generated significant operating losses as reflected in our accumulated deficit on our condensed consolidated balance sheets. While we expect to continue to incur operating losses and may incur negative cash flows from operations in the future, we believe that current cash and cash equivalents and cash flows from operating activities will be sufficient to fund our operations for at least the next twelve months.
Current wording
As of March 31, 2025, our principal sources of liquidity were cash, cash equivalents and marketable securities totaling $767.0 million, which were held for working capital purposes. We have financed our operations primarily through cash generated from operations and issuances of convertible debt. We have generated significant operating losses as reflected in our accumulated deficit on our condensed consolidated balance sheets. While we expect to continue to incur operating losses and may incur negative cash flows from operations in the future, we believe that current cash and cash equivalents and cash flows from operating activities will be sufficient to fund our operations for at least the next twelve months.
Previous wording
In August 2023, we issued $702.0 million aggregate principal amount of our 1.250% 2028 Notes. Proceeds from the issuance of the 2028 Notes totaled $691.1 million, net of initial purchaser discounts and issuance costs. We used $396.9 million of the net proceeds from the 2028 Notes offering to repurchase $273.8 million principal amount, together with accrued and unpaid interest thereon, of our 1.125% 2026 Notes in separate and individually negotiated transactions with certain holders. As of September 30, 2024, we had outstanding debt relating to our 2026 Notes and 2028 Notes of $70.7 million and $693.5 million, with corresponding maturity dates of August 15, 2026 and August 15, 2028, respectively.
Current wording
In August 2023, we issued $702.0 million aggregate principal amount of our 1.250% 2028 Notes. Proceeds from the issuance of the 2028 Notes totaled $691.1 million, net of initial purchaser discounts and issuance costs. We used $396.9 million of the net proceeds from the 2028 Notes offering to repurchase $273.8 million principal amount, together with accrued and unpaid interest thereon, of our 1.125% 2026 Notes in separate and individually negotiated transactions with certain holders. As of March 31, 2025, we had outstanding debt relating to our 2026 Notes and 2028 Notes of $70.9 million and $694.6 million, with corresponding maturity dates of August 15, 2026 and August 15, 2028, respectively.
Previous wording
On July 30, 2024, our board of directors authorized a share repurchase program for up to $100.0 million of our outstanding Class A common stock (the “2024 Repurchase Plan”). The repurchases may be made in the open market or through privately negotiated transactions, pursuant to Rule 10b5-1 trading plans or other available means, each in compliance with Rule 10b-18 under the Exchange Act. The timing, manner, price, and amount of the repurchase will be subject to the discretion of the Company’s management, and it may be suspended or discontinued at any time. As of September 30, 2024, we have not made any repurchases under the 2024 Repurchase Plan.
Current wording
On July 30, 2024, our board of directors authorized a share repurchase plan for up to $100.0 million of our outstanding Class A common stock (the “2024 Repurchase Plan”). The repurchases may be made in the open market or through privately negotiated transactions, pursuant to Rule 10b5-1 trading plans or other available means, each in compliance with Rule 10b-18 under the Exchange Act. The timing, manner, price, and amount of the repurchase will be subject to the discretion of the Company’s management, and it may be suspended or discontinued at any time. As of March 31, 2025, we have repurchased $40.1 million of our Class A common stock under the 2024 Repurchase Plan.
Previous wording
Cash provided by operating activities of $18.9 million for the three months ended September 30, 2024 consisted of a net loss of $17.0 million adjusted for non-cash charges of $28.5 million and net cash inflows of $7.4 million from changes in operating assets and liabilities. The change in operating assets and liabilities was primarily driven by an increase in deferred revenue which was due in part to an increase in large contracts signed in the period coupled with growth in our customer base. The increases in accounts receivable, other receivables, and accounts payable as well as the decrease in accrued expenses and other liabilities were attributable primarily to the timing of cash payments and collections.
Current wording
Cash used in operating activities of $7.4 million for the three months ended March 31, 2025 consisted of a net loss of $21.4 million adjusted for non-cash charges of $29.6 million and net cash outflows of $15.6 million from changes in operating assets and liabilities. The change in operating assets and liabilities was primarily driven by a decrease in accrued expenses and other liabilities which was due in part to a reduction in accrued commissions as we experience higher bookings at year-end driving a reduction the following quarter. The decrease in deferred revenue was driven by the deduction of bookings and timing of billings in the current period. Deferred costs decreased primarily due to amortization of incremental costs associated with obtaining customer contracts. The decreases in accounts receivable and other receivables as well as the increases in accounts payable and prepaid expenses and other were attributable primarily to the timing of cash payments and collections.
Previous wording
Cash provided by operating activities of $43.7 million for the nine months ended September 30, 2024 consisted of a net loss of $46.2 million adjusted for non-cash charges of $75.9 million and net cash inflows of $14.0 million from changes in operating assets and liabilities. The adjustments for non-cash charges included a $45.1 million loss on induced conversion from the partial repurchase of our 2026 Notes. The change in operating assets and liabilities was primarily driven by an increase in deferred revenue which was due in part to multi-year prepaid customer contracts coupled with growth in our customer base. The increase in deferred costs was primarily due to growth in subscription bookings. The increases in accounts receivable, other assets, accounts payable, and accrued expenses and other liabilities as well as the decreases in other receivables and prepaid expenses were attributable primarily to the timing of our billings, cash collections, and cash payments.
Current wording
Cash provided by operating activities of $24.8 million for the three months ended March 31, 2024 consisted of a net loss of $11.7 million adjusted for non-cash charges of $22.0 million and net cash inflows of $14.6 million from changes in operating assets and liabilities. The change in operating assets and liabilities was driven by a decrease in deferred revenue which was due in part to a reduction of multi-year prepaid customer contracts and timing of contract negotiations. The decreases in accounts receivable and accrued expenses and other liabilities as well as the increases in accounts payable and prepaid expenses were attributable primarily to the timing of our billings, cash collections, and cash payments.
Previous wording
Cash used in investing activities of $58.5 million for the nine months ended September 30, 2024 consisted of $310.1 million in purchases of marketable securities, $98.1 million for the acquisition of Sustain.Life, and $0.6 million in purchases of fixed assets partially offset by $345.7 million from the maturities of marketable securities and $4.6 million from the sale of marketable securities. Our capital expenditures were associated primarily with computer equipment in support of expanding our infrastructure and work force.
Current wording
Cash provided by investing activities of $17.4 million for the three months ended March 31, 2024 consisted of $129.6 million from the maturities of marketable securities and $4.6 million from the sale of marketable securities partially offset by $116.6 million in purchases of marketable securities.
Previous wording
Cash provided by financing activities of $8.7 million for the three months ended September 30, 2024 consisted of $6.7 million in proceeds from shares issued in connection with our Employee Stock Purchase Plan ("ESPP") and $3.3 million in proceeds from option exercises partially offset by $1.2 million in taxes paid related to net share settlements of stock-based compensation awards.
Current wording
Cash used in financing activities of $45.0 million for the three months ended March 31, 2025 consisted of $40.1 million in repurchases of our Class A common stock under the 2024 Repurchase Plan and $12.9 million in taxes paid related to net share settlements of stock-based compensation awards partially offset by $7.5 million in proceeds from shares issued in connection with our Employee Stock Purchase Plan ("ESPP") and $0.6 million in proceeds from option exercises.
Previous wording
During the nine months ended September 30, 2024, there were no significant changes to our critical accounting policies and estimates as described in the financial statements contained in the Annual Report on Form 10-K for the year ended December 31, 2023 filed with the SEC on February 20, 2024.
Current wording
During the three months ended March 31, 2025, there were no significant changes to our critical accounting policies and estimates as described in the financial statements contained in the Annual Report on Form 10-K for the year ended December 31, 2024 filed with the SEC on February 25, 2025.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
Total revenue increased $75.4 million for the nine months ended September 30, 2024 compared to the same period a year ago due primarily to a $76.9 million increase in subscription and support revenue. Growth in subscription and support revenue was attributable mainly to strong demand and continued solution expansion across our customer base. Revenue from professional services decreased $1.5 million for the nine months ended September 30, 2024 compared to the same period a year ago. We continue to transition consulting and other services to our partners and expect the revenue growth rate from subscription and support to continue to outpace revenue growth from professional services on an annual basis.