DROPBOX, INC.

Previous wording

By solving these universal problems, we’ve become invaluable to our users. The popularity of our platform allows us to scale efficiently. We’ve built a thriving global business with 18.07 million paying users.

Current wording

By solving these universal problems, we’ve become invaluable to our users. The popularity of our platform allows us to scale efficiently. We’ve built a thriving global business with 18.09 million paying users.

Previous wording

We generate revenue from individuals, families, teams, and organizations by selling subscriptions to our platform, which serve the varying needs of our diverse customer base. Our subscriptions include individual licenses through our Plus, Professional or Essentials plans, or multiple licenses through our Family plan or our Standard, Advanced, Business, Business Plus and Enterprise team plans. We also offer Dash for Business, our AI-powered universal search tool, which we offer to teams at an additional cost. Each team or family represents a separately billed deployment that is managed through a single administrative dashboard. Teams must have a minimum of three users, but can also have more than tens of thousands of users. Families can have up to six users. Customers can choose between an annual or monthly plan, with a small number of large organizations on multi-year plans. A majority of our customers opt for our annual plan, although we have seen and may continue to see an increase in customers opting for our monthly plans. We typically bill our customers at the beginning of their respective terms and recognize revenue ratably over the term of the subscription period. International customers can pay in U.S. dollars or a select number of foreign currencies.

Current wording

We generate revenue from individuals, families, teams, and organizations by selling subscriptions to our platform, which serve the varying needs of our diverse customer base. Our subscriptions include individual licenses through our Plus, Simple, Professional or Essentials plans, or multiple licenses through our Family plan or our Standard, Advanced, Business, Business Plus and Enterprise team plans. We also offer Dash, our AI-powered universal search tool, which we offer to teams at an additional cost. Each team or family represents a separately billed deployment that is managed through a single administrative dashboard. Teams must have a minimum of three users, but can also have more than tens of thousands of users. Families can have up to six users. Customers can choose between an annual or monthly plan, with a small number of large organizations on multi-year plans. A majority of our customers opt for our annual plan, although we have seen and may continue to see an increase in customers opting for our monthly plans. We typically bill our customers at the beginning of their respective terms and recognize revenue ratably over the term of the subscription period. International customers can pay in U.S. dollars or a select number of foreign currencies.

Previous wording

Our premium subscription plans, such as Professional and Advanced, provide more functionality than our other subscription plans and have higher per user prices. Our Standard, Advanced, Business and Business Plus subscription plans offer robust capabilities for businesses, and the vast majority of Dropbox Business teams purchase our Standard or Advanced subscription plans. While our Enterprise subscription plan offers more opportunities for customization, companies can subscribe to any of these team plans for their business needs.

Current wording

Our premium subscription plans, such as Professional and Advanced, provide more functionality than our other subscription plans and have higher per user prices. Our team subscription plans offer robust capabilities for businesses, and the vast majority of Dropbox Business teams purchase our Standard or Advanced subscription plans. While our Enterprise subscription plan offers more opportunities for customization, companies can subscribe to any of these team plans for their business needs.

Previous wording

We offer FormSwift, our cloud-based service that gives individuals and businesses a simple solution to create, complete, edit, and save critical business forms and agreements. Customers can choose between annual or monthly subscriptions based on their individual or business needs. We typically bill FormSwift customers at the beginning of their respective terms and recognize revenue ratably over the subscription period. FormSwift primarily sells within the United States, and the majority of its sales are in U.S. dollars. We made the strategic decision to significantly reduce investments in FormSwift at the beginning of 2025, which has negatively impacted our annual recurring revenue ("ARR"), revenue and paying users in 2025.

Current wording

We offer FormSwift, our cloud-based service that gives individuals and businesses a simple solution to create, complete, edit, and save critical business forms and agreements. We offer only monthly subscriptions based on their individual or business needs. We typically bill FormSwift customers at the beginning of their respective terms and recognize revenue ratably over the subscription period. FormSwift primarily sells within the United States, and the majority of its sales are in U.S. dollars. We made the strategic decision to significantly reduce investments in FormSwift at the beginning of 2025 and plan to wind down operations by the end of 2026, which has negatively impacted our annual recurring revenue ("ARR"), revenue and paying users.

Previous wording

We offer a range of paid subscription plans, from Plus, Professional, and Essentials for individuals to Standard, Advanced, Business, Business Plus and Enterprise for teams. We analyze usage patterns within our network and run hundreds of targeted marketing campaigns to encourage paying users to upgrade their plans. We prompt individual subscribers who collaborate with others on Dropbox to purchase our Standard, Advanced or Business, and Business Plus plans for a better team experience, and we also encourage existing Dropbox Business teams to purchase additional licenses or to upgrade to premium subscription plans. We also aim to offer additional products that expand our content collaboration capabilities, such as through our acquisitions of Dropbox Sign, DocSend and Reclaim.

Current wording

We offer a range of paid subscription plans, from Plus, Simple, Professional, and Essentials for individuals to Standard, Advanced, Business, Business Plus and Enterprise for teams. We analyze usage patterns within our network and run hundreds of targeted marketing campaigns to encourage paying users to upgrade their plans. We prompt individual subscribers who collaborate with others on Dropbox to purchase our Standard, Advanced or Business, and Business Plus plans for a better team experience, and we also encourage existing Dropbox Business teams to purchase additional licenses or to upgrade to premium subscription plans. We also aim to offer additional products that expand our content collaboration capabilities, such as through our acquisitions of Dropbox Sign, DocSend and Reclaim.

Previous wording

Our ARR fluctuates and may decrease in some periods as compared to prior periods. In the near term, ARR has experienced and may continue to experience a slight decline, reflecting our strategic decision to significantly reduce investments in FormSwift at the beginning of 2025.

Current wording

Our ARR fluctuates and may decrease in some periods as compared to prior periods. In the near term, ARR has experienced and may continue to experience a slight decline, primarily reflecting our strategic decision to significantly reduce investments in FormSwift at the beginning of 2025 as well as our plan to wind down operations by the end of 2026.

Previous wording

Total ARR decreased for the period ended September 30, 2025, compared to the periods ended December 31, 2024 and September 30, 2024, primarily driven by our strategic decision to significantly reduce our investment in FormSwift at the beginning of 2025 and a challenging operating environment across our Teams plans.

Current wording

Total ARR increased for the period ended March 31, 2026, compared to the periods ended December 31, 2025 and March 31, 2025, primarily driven by a favorable impact of changes in foreign exchange rates across multiple currencies relative to the U.S. dollar and growth in Individual plans, offset by our strategic decision to significantly reduce our investment in FormSwift.

Previous wording

The number of paying users as of September 30, 2025 declined as compared to December 31, 2024 and September 30, 2024, largely due to a challenging operating environment across our Teams plans and our strategic decision to significantly reduce our investments in FormSwift at the beginning of 2025. We expect that the total number of paying users will continue to fluctuate from period to period and may continue to decrease in some periods as compared to prior periods.

Current wording

The number of paying users as of March 31, 2026 increased as compared to December 31, 2025, largely due to growth in our Simple plan partially offset by continued softness in our Teams plans, for which we are starting to see early signs of improvement, and reduced investment in FormSwift. However, the number of paying users as of March 31, 2026 declined as compared to March 31, 2025, largely due to our strategic decision to significantly reduce our investments in FormSwift at the beginning of 2025. We expect that the total number of paying users will continue to fluctuate from period to period and may continue to decrease in some periods as compared to prior periods.

Previous wording

The average revenue per paying user increased for the three months ended September 30, 2025 as compared to the three months ended September 30, 2024, as a result of the favorable impact of changes in foreign exchange rates across multiple currencies relative to the U.S. dollar offset by our strategic decision to significantly reduce our investment in FormSwift. The average revenue per paying user for the nine months ended September 30, 2025 decreased as compared to the nine months ended September 30, 2024 as a result of our strategic decision to significantly reduce our investment in FormSwift and an increased mix of sales towards our lower priced plans.

Current wording

The average revenue per paying user increased for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025, as a result of the favorable impact of changes in foreign exchange rates across multiple currencies relative to the U.S. dollar offset by our strategic decision to significantly reduce our investment in FormSwift.

Previous wording

The below table sets forth our ARPU for the three and nine months ended September 30, 2025 and 2024.

Current wording

The below table sets forth our ARPU for the three months ended March 31, 2026 and 2025.

Previous wording

Our FCF increased for the nine months ended September 30, 2025, compared to the nine months ended September 30, 2024, primarily due to an increase in cash provided by operating activities, in addition to a decrease in capital expenditures. The increase in cash provided by operating activities was primarily due to an increase in net income, as adjusted for stock-based compensation and depreciation and amortization expenses, partially offset by an increase in cash outflows from changes in operating assets and liabilities. The increase in cash outflows from operating assets and liabilities was primarily driven by the payment for the third tranche termination fee for the partial termination of our lease for our San Francisco, California corporate headquarters and payments related to our reduction in workforce announced in the fourth quarter of 2024.

Current wording

Our FCF increased for the three months ended March 31, 2026, compared to the three months ended March 31, 2025, primarily due to an increase in cash provided by operating activities, reflecting payments made in the first quarter of 2025 for the third tranche termination fee for the partial termination of our lease for our San Francisco, California corporate headquarters and related to our 2024 reduction in workforce.

Previous wording

We expect our FCF to generally increase in the near term as we drive operating efficiencies, partly due to our reduction in workforce in the fourth quarter of 2024. We expect to continue purchasing infrastructure equipment to support our user base and anticipate that our capital expenditures will increase in the last quarter of 2025. However, we expect overall spend in future periods to remain consistent with prior years as we continue to invest in our internal infrastructure, network and security. The timing of our operating expenses as described below, may cause FCF to vary from period to period as a percentage of revenue.

Current wording

We expect our FCF to fluctuate in the near term due to ongoing operating efficiency initiatives and variability in interest payments now that our term loan facility is fully drawn, as well as fluctuations in market interest rates. We expect capital expenditures will generally remain consistent in future periods as we continue to invest in our internal infrastructure, network and security to support our user base, except for a one-time incremental investment related to the build-out of our new San Francisco, California headquarters given we will vacate our current San Francisco, California headquarters due to subleases executed in the first quarter of 2026. The timing of our operating expenses as described below, may cause FCF to vary from period to period as a percentage of revenue.

Previous wording

Our revenue growth is impacted by both the number of paying users and our ability to increase the average revenue per paying user. Our overall paying user growth rate has declined, and we expect growth in paying users to fluctuate from period to period in the future. Given that our revenue and average revenue per paying user have declined, if we do not successfully increase the average revenue per paying user, for example, through pricing and packaging changes or increased sales of our higher-priced subscription plans, or otherwise offset slower growth or declines in paying users, we expect our revenue and revenue growth rate to continue decreasing.

Current wording

Our revenue growth is impacted by both the number of paying users and our ability to increase the average revenue per paying user. Our overall paying user growth rate has declined, and we expect growth in paying users to fluctuate from period to period in the future. If we do not successfully reverse the trend of decreasing average revenue per paying user, for example through increased sales of our higher-priced subscription plans, or otherwise offset slower growth or declines in paying users, we expect our revenue and revenue growth rate to continue decreasing.

Previous wording

Cost of revenue. Our cost of revenue consists primarily of expenses associated with the storage, delivery, and distribution of our platform for both paying users and free users. These costs, which we refer to as infrastructure costs, include depreciation of our servers located in co-location facilities that we lease and operate, rent and facilities expense for those datacenters, network and bandwidth costs, support and maintenance costs for our infrastructure equipment, and payments to third-party datacenter service providers. Cost of revenue also includes salaries, bonuses, employer payroll taxes and benefits, travel-related expenses, expenses related to our reduction in workforce in the fourth quarter of 2024, such as severance, benefits and other related items, and stock-based compensation, which we refer to as employee-related costs, for employees whose primary responsibilities relate to supporting our infrastructure and delivering user support. Other non-employee costs included in cost of revenue include credit card fees related to processing customer transactions, and allocated overhead, such as facilities, including rent, utilities, depreciation on leasehold improvements and other equipment shared by all departments, and shared information technology costs. In addition, cost of revenue includes amortization of developed technologies, professional fees related to user support initiatives, and property taxes related to datacenter equipment.

Current wording

Cost of revenue. Our cost of revenue consists primarily of expenses associated with the storage, delivery, and distribution of our platform for both paying users and free users. These costs, which we refer to as infrastructure costs, include depreciation of our servers located in co-location facilities that we lease and operate, rent and facilities expense for those datacenters, network and bandwidth costs, support and maintenance costs for our infrastructure equipment, and payments to third-party datacenter service providers. Cost of revenue also includes salaries, bonuses, employer payroll taxes and benefits, travel-related expenses, and stock-based compensation, which we refer to as employee-related costs, for employees whose primary responsibilities relate to supporting our infrastructure and delivering user support. Other non-employee costs included in cost of revenue include credit card fees related to processing customer transactions, and allocated overhead, such as facilities, including rent, utilities, depreciation on leasehold improvements and other equipment shared by all departments, and shared information technology costs. In addition, cost of revenue includes amortization of developed technologies, professional fees related to user support initiatives, and property taxes related to datacenter equipment.

Previous wording

Research and development. Our research and development expenses consist primarily of employee-related costs for our engineering, product, and design teams, expenses related to our reduction in workforce in the fourth quarter of 2024, such as severance, benefits and other related items, compensation expenses related to key personnel from acquisitions and allocated overhead. These groups are responsible for the design, development, testing, delivery of new technologies and features, and support of our self-serve platform. We continue to focus our product development efforts on adding new features and enhancing the functionality and ease of use of our offerings. Additionally, research and development expenses include internal development-related third-party hosting fees. We have expensed almost all of our research and development costs as they were incurred.

Current wording

Research and development. Our research and development expenses consist primarily of employee-related costs for our engineering, product, and design teams, compensation expenses related to key personnel from acquisitions and allocated overhead. These groups are responsible for the design, development, testing, delivery of new technologies and features, and support of our self-serve platform. We continue to focus our product development efforts on adding new features and enhancing the functionality and ease of use of our offerings. Additionally, research and development expenses include internal development-related third-party hosting fees. We have expensed almost all of our research and development costs as they were incurred.

Previous wording

We expect that research and development costs will decrease in absolute dollars and as a percentage of revenue in both the near term and long term as a result of our reduction in workforce in the fourth quarter of 2024, partially offset by continued hiring for our engineering, product, and design teams in roles critical to our future growth initiatives. The trend and timing of research and development expenses will depend in part on the timing for these new hires.

Current wording

We expect that research and development costs will decrease in absolute dollars and as a percentage of revenue in both the near term and long term as we continue to drive operating efficiencies across the business, partially offset by ongoing investment in key growth initiatives.

Previous wording

Sales and marketing. Our sales and marketing expenses relate to both self-serve and outbound sales activities, and consist primarily of employee-related costs, expenses related to our reduction in workforce in the fourth quarter of 2024, such as severance, benefits and other related items, advertising costs, brand marketing costs, lead generation costs, sponsorships and allocated overhead. Sales commissions earned by our outbound sales team and the related payroll taxes, as well as commissions earned by third-party resellers that we consider to be incremental and recoverable costs of obtaining a contract with a customer, are deferred and are typically amortized over an estimated period of benefit of five years. Additionally, sales and marketing expenses include non-employee costs related to app store fees, fees payable to third-party sales representatives and amortization of acquired customer relationships.

Current wording

Sales and marketing. Our sales and marketing expenses relate to both self-serve and outbound sales activities, and consist primarily of employee-related costs, advertising costs, brand marketing costs, lead generation costs, sponsorships and allocated overhead. Sales commissions earned by our outbound sales team and the related payroll taxes, as well as commissions earned by third-party resellers that we consider to be incremental and recoverable costs of obtaining a contract with a customer, are deferred and are typically amortized over an estimated period of benefit of five years. Additionally, sales and marketing expenses include non-employee costs related to app store fees, fees payable to third-party sales representatives and amortization of acquired customer relationships.

Previous wording

General and administrative. Our general and administrative expenses consist primarily of employee-related costs for our legal, finance, human resources, and other administrative teams, as well as certain executives. In addition, general and administrative expenses include expenses related to our reduction in workforce in the fourth quarter of 2024, such as severance, benefits and other related items, allocated overhead, outside legal, accounting and other professional fees, and non income-based taxes.

Current wording

General and administrative. Our general and administrative expenses consist primarily of employee-related costs for our legal, finance, human resources, and other administrative teams, as well as certain executives. In addition, general and administrative expenses include allocated overhead, outside legal, accounting and other professional fees, and non income-based taxes.

Previous wording

Interest (expense) income, net consists primarily of interest expense related to our term loan facility, finance lease obligations for infrastructure and amortization of debt issuance costs, offset by interest income earned on our investments classified as cash and cash equivalents, and short-term investments. Subsequent to the term loan issuance in the fourth quarter of 2024, we expect interest (expense) income, net to remain relatively constant in both the near term and the long term, assuming no significant changes in market rates.

Current wording

Interest expense, net consists primarily of interest expense related to our term loan facility, finance lease obligations for infrastructure and amortization of debt issuance costs, offset by interest income earned on our investments classified as cash and cash equivalents, and short-term investments. We expect that interest expense, net may fluctuate in both the near term and the long term now that our term loan facility is fully drawn, as well as from changes in market interest rates.

Previous wording

Provision for income taxes consists of U.S. federal, state and foreign jurisdiction income taxes. For 2025 and 2024, the difference between the U.S. statutory rate and our effective tax rate is primarily due to the jurisdictional mix of earnings, tax credits, state income taxes, and changes to our unrecognized tax benefits.

Current wording

Provision for income taxes consists of U.S. federal, state and foreign jurisdiction income taxes. For 2026 and 2025, the difference between the U.S. statutory rate and our effective tax rate is primarily due to the jurisdictional mix of earnings, tax credits, state income taxes, stock-based compensation, and changes to our unrecognized tax benefits.

Previous wording

Revenue decreased $4.4 million or 0.7% during the three months ended September 30, 2025, as compared to the three months ended September 30, 2024 primarily due toour strategic decision to significantly reduce our investment in FormSwift as well as weakness in Teams plans as a result of churn and fewer customers upgrading, offset by growth in our Individuals plans. In addition, revenue was positively impacted by$3.1 million from changes in foreign exchange rates across multiple currencies.

Current wording

Revenue increased $4.8 million or 0.8% during the three months ended March 31, 2026, as compared to the three months ended March 31, 2025 primarily due to growth from our Individual plans, offset byour strategic decision to significantly reduce our investment in FormSwift and our plan to wind down operations by the end of 2026. In addition, revenue was positively impacted by changes in foreign exchange rates across multiple currencies.

Previous wording

Cost of revenue increased $16.8 million or 15.1% during the three months ended September 30, 2025, as compared to the three months ended September 30, 2024. This increase was primarily driven by a $16.7 million increase in infrastructure costs due to increased depreciation resulting from our datacenter refresh cycle.

Current wording

Cost of revenue increased $11.4 million or 9.8% during the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. This increase was primarily driven by an $11.4 million increase in infrastructure costs, including costs associated with adding equipment in support of our data center refresh cycle, data center facilities costs, and third party hosting fees.

Previous wording

Our gross margin decreased during the three months ended September 30, 2025 compared to the three months ended September 30, 2024, primarily due to a 15.1% increase in our cost of revenue, along with a 0.7% decrease in revenue during the period, as described above.

Current wording

Our gross margin decreased during the three months ended March 31, 2026 compared to the three months ended March 31, 2025, primarily due to a 9.8% increase in our cost of revenue, partially offset by a 0.8% increase in revenue during the period, as described above.

Previous wording

Sales and marketing expenses decreased $19.0 million or 17.2% during the three months ended September 30, 2025, as compared to the three months ended September 30, 2024, primarily due to a decrease of $11.6 million related to advertising due to our strategic decision to significantly reduce our investments in FormSwift and other marketing related expenses as well as a $5.1 million decrease in employee-related costs driven by a decrease in headcount.

Current wording

Sales and marketing expenses decreased $5.1 million or 5.5% during the three months ended March 31, 2026, as compared to the three months ended March 31, 2025, primarily due to a decrease of $3.1 million related to advertising expenses as well as a $2.8 million decrease in employee-related costs driven by a decrease in headcount.

Previous wording

Other income, net decreased $2.2 million during the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024, primarily due to a $2.8 million increase in foreign currency transaction losses.

Current wording

Other income, net increased by $5.0 million during the three months ended March 31, 2026, as compared to the three months ended March 31, 2025, primarily due to a $2.7 million increase in foreign currency transaction gains and a $2.1 million gain on datacenter equipment resales.

Previous wording

Provision for income taxes increased $7.4 million during the three months ended September 30, 2025, as compared to the three months ended September 30, 2024, primarily due an increase in income before income taxes and the cumulative impact of the One Big Beautiful Bill Act reflected in thethree months ended September 30, 2025.

Current wording

Provision for income taxes increased $7.7 million during the three months ended March 31, 2026, as compared to the three months ended March 31, 2025, primarily due to the impact of the One Big Beautiful Bill Act reflected in the three months ended March 31, 2026, a reduction in stock based compensation tax benefits, and changes to our unrecognized tax benefits.

Previous wording

As of September 30, 2025, we had cash and cash equivalents of $730.7 million and short-term investments of $194.6 million, which were held for working capital purposes. Our cash, cash equivalents, and short-term investments consist primarily of cash, money market funds, corporate notes and obligations, U.S. Treasury securities, asset-backed securities, U.S. agency obligations, supranational securities, and municipal securities. As of September 30, 2025, $351.2 million of our cash and cash equivalents was held by our foreign subsidiaries. We do not expect to incur material taxes in the event we repatriate any of these amounts. Our cash is held at several large financial institutions and our investments are focused on the preservation of capital, fulfillment of our liquidity needs, and maximization of investment performance within the parameters set forth in our investment policy and subject to market conditions. The investment policy sets forth credit rating minimums, permissible allocations, and limits our exposure to specific investment types. We believe these policies mitigate our exposure to risk concentrations.

Current wording

As of March 31, 2026, we had cash and cash equivalents of $1,207.4 million and short-term investments of $81.4 million, which were held for working capital purposes. Our cash, cash equivalents, and short-term investments consist primarily of cash, money market funds, corporate notes and obligations, U.S. Treasury securities, asset-backed securities, U.S. agency obligations, supranational securities, and municipal securities. As of March 31, 2026, $304.3 million of our cash and cash equivalents was held by our foreign subsidiaries. We do not expect to incur material taxes in the event we repatriate any of these amounts. Our cash is held at several large financial institutions and our investments are focused on the preservation of capital, fulfillment of our liquidity needs, and maximization of investment performance within the parameters set forth in our investment policy and subject to market conditions. The investment policy sets forth credit rating minimums, permissible allocations, and limits our exposure to specific investment types. We believe these policies mitigate our exposure to risk concentrations.

Previous wording

We have historically financed our operations primarily through cash generated from our operations, the Notes issuance, borrowings from our term loan facility, equity issuances, and finance leases to finance infrastructure-related assets in co-location facilities that we directly lease and operate. We enter into finance leases in part to better match the timing of payments for infrastructure-related assets with that of cash received from our paying users. In our business model, some of our registered users convert to paying users over time, and consequently there is a lag between initial investment in infrastructure assets and cash received from some of our users. We also have delayed draw term loan commitments as part of the term loan facility for additional working capital flexibility, as described below.

Current wording

We have historically financed our operations primarily through cash generated from our operations, borrowings from our term loan facility, the Notes (as defined below) issuance, equity issuances, and finance leases for our infrastructure-related assets in co-location facilities that we directly lease and operate. We enter into finance leases in part to better match the timing of payments for infrastructure-related assets with that of cash received from our paying users. In our business model, some of our registered users convert to paying users over time, and consequently there is a lag between initial investment in infrastructure assets and cash received from some of our users.

Previous wording

In February 2021, we issued approximately $1.4 billion in aggregate principal amount of the Notes, comprised of $695.8 million in aggregate principal amount of 2026 Notes and $693.3 million in aggregate principal amount of 2028 Notes. The net proceeds from the issuance of the 2026 Notes and 2028 Notes were $684.8 million, net of debt issuance costs, and $682.3 million, net of debt issuance costs, respectively. The 2026 Notes mature on March 1, 2026 and the 2028 Notes mature on March 1, 2028. The Notes of each series do not bear regular interest and the principal does not accrete. The Notes of each series may bear special interest as the remedy relating to our failure to comply with certain of our reporting obligations. These Notes can be converted or repurchased prior to maturity if certain conditions are met.

Current wording

In February 2021, we issued approximately $1.4 billion in aggregate principal amount of the 2026 Notes and the 2028 Notes (together the "Notes"), comprised of $695.8 million in aggregate principal amount of 2026 Notes and $693.3 million in aggregate principal amount of 2028 Notes. The net proceeds from the issuance of the 2026 Notes and 2028 Notes were $684.8 million, net of debt issuance costs, and $682.3 million, net of debt issuance costs, respectively. The Company paid a total of $695.8 million in cash to settle the unconverted principal balance of the 2026 Notes upon maturity in the first quarter of 2026 using the proceeds from the 2025 delayed draw term loans described below. The 2028 Notes mature on March 1, 2028. The 2028 Notes do not bear regular interest and the principal does not accrete. The 2028 Notes may bear special interest as the remedy relating to our failure to comply with certain of our reporting obligations. The 2028 Notes can be converted or repurchased prior to maturity if certain conditions are met.

Previous wording

In December 2024, we entered into a secured five-year term loan facility in an aggregate principal amount of up to $2.0 billion, consisting of initial term loans and initial delayed draw term loan commitments each in an aggregate principal amount of up to $1.0 billion, respectively. The terms of the initial Credit Agreement also provide for a secured letter of credit facility in an aggregate amount of up to $35.0 million. In September 2025, we entered into the First Amendment to the term loan facility which provided for additional secured delayed draw term loan commitments in an aggregate principal amount of up to $700.0 million. The 2025 delayed draw term loans may be borrowed solely for the purpose of prepaying, repaying, repurchasing, redeeming, exchanging or settling upon conversion the 2026 Notes. We expect to pay the 2026 Notes using proceeds from the loans prior to or at maturity in 2026.

Current wording

In December 2024, we entered into a secured five-year term loan facility in an aggregate principal amount of up to $2.0 billion, consisting of initial term loans and initial delayed draw term loan commitments (the "initial delayed draw term loans") each in an aggregate principal amount of up to $1.0 billion, respectively. The terms of the initial Credit Agreement also provide for a secured letter of credit facility in an aggregate amount of up to $35.0 million. In September 2025, we entered into the First Amendment to the term loan facility which provided for additional secured delayed draw term loan commitments in an aggregate principal amount of up to $700.0 million (the "2025 delayed draw term loans"), which was drawn in the first quarter of 2026 to settle the 2026 Notes as described above, with the remaining proceeds available for general corporate purposes.

Previous wording

The initial term loans have a maturity date of December 11, 2029 and the 2025 delayed draw term loans have a maturity date of September 9, 2030. Quarterly principal payments for the initial term loan began on March 31, 2025 and will continue on the last business day of each quarter thereafter, equal to 0.25% of the original principal amount of such term loans or such greater percentage as may be required to make the initial delayed draw term loans fungible with any then-outstanding term loans. Quarterly repayments of 0.25% of the original principal amount of the 2025 delayed draw term loans are required beginning on the last business day of the quarter after the funding of such loans and continuing thereafter. As of September 30, 2025, we had $1,142.1 million outstanding and $1,550.0 million available to draw on the term loan facility.

Current wording

The initial term loans and initial delayed draw term loans have a maturity date of December 11, 2029 and the 2025 delayed draw term loans have a maturity date of September 9, 2030. Quarterly principal payments for the initial term loans and initial delayed draw term loans began on March 31, 2025 and on the last business day of the quarter after the funding of such loans, respectively, and will continue on the last business day of each quarter thereafter, equal to 0.25% of the original principal amount of such term loans or such greater percentage as may be required to make the initial delayed draw term loans fungible with any then-outstanding initial term loans and initial delayed draw term loans. Quarterly repayments of 0.25% of the original principal amount of the 2025 delayed draw term loans began on March 31, 2026 and on the last business day of the quarter after the funding of such loans and continuing thereafter. As of March 31, 2026, we had $2,681.6 million outstanding on the term loan facility and no commitment remained available. As of March 31, 2026, $18.7 million of letters of credit were issued and $16.3 million remains to be issued under the letter of credit facility.

Previous wording

Interest on borrowings under the term loan facility accrues at either an alternate base rate or a term SOFR rate (further described in Note 7 "Debt") at the Company's option. Pursuant to the terms of the Amended Credit Agreement, we are required to pay a quarterly commitment fee that accrues at a rate of 1.00% per annum on both the unused portion of the initial delayed draw term loan commitments and the unused portion of the 2025 delayed draw term loans. The 2025 delayed draw term loans commitment fees will start accruing on the unused portion three months after the effective date of the First Amendment.

Current wording

Interest on borrowings under the term loan facility accrues at either an alternate base rate plus a margin of 2.75% or a term SOFR rate plus a margin of 3.75% (further described in Note 7 "Debt") at our option.

Previous wording

The term loan facility permits the Company, subject to satisfaction of certain conditions, including obtaining commitments from new or existing lenders, to add new term loan facilities or increase the term loan commitments under the term loan agreement, in each case, subject to certain limits. Additionally, the Amended Credit Agreement contains customary representations and warranties, customary affirmative and negative covenants, and customary events of default. Failure to comply with these covenants may result in a portion of the outstanding term loan debt becoming due immediately. We were in compliance with all covenants under the term loan facility as of September 30, 2025.

Current wording

The term loan facility permits us, subject to satisfaction of certain conditions, including obtaining commitments from new or existing lenders, to add new term loan facilities or increase the term loan commitments under the term loan agreement, in each case, subject to certain limits. Additionally, the Amended Credit Agreement contains customary representations and warranties, customary affirmative and negative covenants, and customary events of default. Failure to comply with these covenants may result in a portion of the outstanding term loan debt becoming due immediately. We were in compliance with all covenants under the term loan facility as of March 31, 2026.

Previous wording

Our principal uses of cash in recent periods have been funding our operations, repurchases of our Class A common stock, the satisfaction of tax withholding obligations in connection with the settlement of restricted stock units and awards, making principal payments on our finance lease obligations, and capital expenditures. Our Board of Directors has authorized three separate $1.2 billion Class A common stock repurchase programs since February 2022, with authorizations in February 2022, July 2023 and December 2024. We completed the February 2022 and July 2023 authorizations during the three months ended March 31, 2024, and March 31, 2025, respectively. In August 2025, our Board of Directors authorized a new repurchase program for the purchase of an additional $1.5 billion shares of our Class A common stock. Share repurchases are made from time-to-time in private transactions or open market purchases as permitted by securities laws and other legal requirements and are subject to a review of the circumstances in place at that time, including prevailing market prices. The program does not obligate us to repurchase any specific number of shares and has no specified time limit; it may be discontinued at any time. During the three and nine months ended September 30, 2025, we repurchased and subsequently retired 13.8 million and 46.0 million, respectively, of our Class A common stock for an aggregate amount of $393.3 million and $1,300.3 million, respectively. This amount includes the 1% excise tax under the Inflation Reduction Act, as well as repurchase execution costs incurred in connection with our share repurchase program. The pace of our share repurchases may fluctuate due to various circumstances, including market conditions, our stock price, and other strategic investments.

Current wording

Our principal uses of cash in recent periods have been funding our operations, repurchases of our Class A common stock, the satisfaction of tax withholding obligations in connection with the settlement of RSUs and RSAs, making principal payments on our finance lease obligations, and capital expenditures. Our Board of Directors has authorized two separate $1.2 billion Class A common stock repurchase programs in July 2023 and December 2024. We completed the July 2023 and December 2024 authorizations during the three months ended March 31, 2025 and December 31, 2025, respectively. In August 2025, our Board of Directors authorized a new repurchase program of up to an additional $1.5 billion of the outstanding shares of our Class A common stock. Share repurchases are made from time-to-time in private transactions or open market purchases as permitted by securities laws and other legal requirements and are subject to a review of the circumstances in place at that time, including prevailing market prices. The program does not obligate us to repurchase any specific number of shares and has no specified time limit; it may be discontinued at any time. During the three months ended March 31, 2026, we repurchased and subsequently retired 14.3 million shares of our Class A common stock for an aggregate amount of $370.0 million. This amount includes the 1% excise tax under the Inflation Reduction Act, as well as repurchase execution costs incurred in connection with our share repurchase program. The pace of our share repurchases may fluctuate due to various circumstances, including market conditions, our stock price, and other strategic investments.

Previous wording

For the nine months ended September 30, 2025, net cash provided by operating activities was $716.4 million, which primarily consisted of our net income of $399.7 million, adjusted for stock-based compensation expense of $223.4 million, depreciation and amortization expenses of $116.7 million, and net cash outflow of $109.6 million from operating assets and liabilities. The outflow from operating assets and liabilities was primarily due to the payment of our 2024 corporate bonus, the payment for the third tranche termination fee for the partial termination of our lease for our San Francisco, California corporate headquarters, and payments related to our reduction in workforce that we announced in the fourth quarter of 2024, offset by an increase in deferred revenue, as a majority of our paying users are invoiced in advance.

Current wording

For the three months ended March 31, 2026, net cash provided by operating activities was $204.5 million, which primarily consisted of our net income of $114.5 million, adjusted for stock-based compensation expense of $71.1 million, depreciation and amortization expenses of $39.1 million, and net cash outflow of $49.9 million from operating assets and liabilities. The outflow from operating assets and liabilities was primarily due to the payment of our 2025 corporate bonus.

Previous wording

The increase of $36.1 million in net cash provided by operating activities during the nine months ended September 30, 2025, compared to the nine months ended September 30, 2024, was primarily due to an increase of $65.7 million in net income, as adjusted for stock-based compensation, depreciation and amortization expenses, and other non-cash losses (gains), partially offset by an increase of $29.6 million in cash outflows from changes in operating assets and liabilities, primarily driven by the payment for the third tranche termination fee for the partial termination of our lease for our San Francisco, California corporate headquarters and payments related to our reduction in workforce announced in the fourth quarter of 2024.

Current wording

The increase of $50.7 million in net cash provided by operating activities during the three months ended March 31, 2026, compared to the three months ended March 31, 2025, was primarily due to a decrease of $69.8 million in cash outflows from changes in operating assets and liabilities, primarily driven by the payments made in the first quarter of 2025 for the third tranche termination fee for the partial termination of our lease for our San Francisco, California corporate headquarters and for payments related to our 2024 reduction in workforce. This was partially offset by a decrease of $19.1 million in net income, as adjusted for stock-based compensation, depreciation and amortization expenses, and other non-cash (gains) losses.

Previous wording

For the nine months ended September 30, 2025, net cash provided by investing activities was $66.0 million, which primarily related to $76.1 million in net investment activity inflows, driven by the maturities of short-term investments. The increase was partially offset by cash paid for acquisitions of $13.1 million.

Current wording

For the three months ended March 31, 2026, net cash provided by investing activities was $66.9 million, which primarily related to $65.6 million in net investment activity inflows, driven by the maturities of short-term investments.

Previous wording

The decrease of $264.0 million in net cash provided by investing activities during the nine months ended September 30, 2025, compared to the nine months ended September 30, 2024, was primarily due to a decrease of $309.1 million in net investment activity inflows, offset by a decrease of $44.7 million in cash paid for acquisitions and $8.7 million in cash paid for capital expenditures.

Current wording

The increase of $31.1 million in net cash provided by investing activities during the three months ended March 31, 2026, compared to the three months ended March 31, 2025, was primarily due to an increase of $35.6 million in net investment activity inflows, offset by a decrease of $6.0 million in cash receipts from equipment rebates.

Previous wording

Net cash used in financing activities is primarily impacted by cash used for repurchases of common stock, tax withholding obligations for the release of restricted stock units ("RSUs") and restricted stock awards ("RSAs"), principal payments on finance lease obligations for our infrastructure equipment, principal payments on amounts drawn upon the term loan facility, payments of debt issuance costs and loan commitment fees related to the term loan facility, and payments of acquisition-related indemnity holdback amounts, offset by proceeds from the term loan facility.

Current wording

Net cash used in financing activities is primarily impacted by cash used for repurchases of common stock, tax withholding obligations for the release of RSUs and RSAs, principal payments on finance lease obligations for our infrastructure equipment, principal payments on amounts drawn upon the term loan facility, payments of debt issuance costs and loan commitment fees related to the term loan facility, repayments of convertible senior notes at maturity, and payments of acquisition-related indemnity holdback amounts, offset by proceeds from the term loan facility.

Previous wording

For the nine months ended September 30, 2025, net cash used in financing activities was $1,389.9 million, which primarily consisted of $1,298.9 million for the repurchase of our common stock, $113.9 million for the satisfaction of tax withholding obligations for the release of restricted stock units and awards, $101.9 million in principal payments on finance lease obligations, and $7.9 million for the principal payments against the term loan facility. The outflow was offset by $132.6 million in proceeds from the term loan facility, net of debt issuance costs and loan commitment fees.

Current wording

For the three months ended March 31, 2026, net cash provided by financing activities was $46.2 million, which primarily consisted of $1,200.0 million in proceeds from the term loan facility. The inflow was offset by $695.8 million for the repayment of convertible senior notes at maturity, $366.8 million for the repurchase of our common stock, $30.3 million for the satisfaction of tax withholding obligations for the release of RSUs and RSAs, $43.4 million in principal payments on finance lease obligations, $8.1 million in payments of debt issuance costs and loan commitment fees under the term loan facility, and $6.8 million in principal payments against the term loan facility.