Upland Software Inc

For the period ended Sep 30, 2024. Filed Nov 7, 2024.

About this filing

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.

Sep 30, 2024 · Filed Nov 7, 2024

UPLD$3.82-3.9%Stored close · as of Nov 9, 2026

Extracted filing text, with the paragraph anchors used by the comparison.

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Contents

Item 1. Financial Statements

	Condensed Consolidated Balance Sheets as of September 30, 2024 and December 31, 2023	1
	Condensed Consolidated Statements of Operations for the Three and Nine Months Ended September 30, 2024 and September 30, 2023	2
	Condensed Consolidated Statements of Comprehensive Income (Loss) for the Three and Nine Months Ended September 30, 2024 and September 30, 2023	3
	Condensed Consolidated Statements of Equity for the Three and Nine Months Ended September 30, 2024 and September 30, 2023	4
	Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2024 and September 30, 2023	6
	Notes to Condensed Consolidated Financial Statements	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	35
Item 4.	Controls and Procedures	36
Part II.	OTHER INFORMATION	37
Item1A.	Risk Factors	37
Item 5.	Other Information	37
Item 6.	Exhibits	37
Exhibit Index	38
Signature	39

Condensed Consolidated Balance Sheets

(in thousands, except for share and per share amounts)

	September 30, 2024	December 31, 2023
ASSETS · (unaudited)
Current assets:
Cash and cash equivalents	$59,739	$236,559
Accounts receivable (net of allowance of $385 and $572 at September 30, 2024, and December 31, 2023, respectively)	31,849	38,765
Deferred commissions, current	9,192	10,429
Unbilled receivables	3,505	2,701
Income tax receivable, current	2,931	3,775
Prepaid expenses and other current assets	10,731	8,004
Total current assets	117,947	300,233
Tax credits receivable	1,319	1,657
Property and equipment, net	1,559	1,932
Operating lease right-of-use asset	1,595	2,929
Intangible assets, net	142,652	182,349
Goodwill	269,010	353,778
Deferred commissions, noncurrent	11,866	12,568
Interest rate swap assets	8,576	14,270
Other assets	414	308
Total assets	$554,938	$870,024
LIABILITIES, CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$8,788	$8,137
Accrued compensation	6,707	7,174
Accrued expenses and other current liabilities	6,085	7,050
Deferred revenue	92,740	102,763
Operating lease liabilities, current	1,278	2,351
Current maturities of notes payable (includes unamortized discount of $2,022 and $2,228 at September 30, 2024, and December 31, 2023, respectively)	3,378	3,172
Total current liabilities	118,976	130,647
Notes payable, less current maturities (includes unamortized discount of $1,688 and $3,148 at September 30, 2024, and December 31, 2023, respectively)	293,912	473,502
Deferred revenue, noncurrent	3,296	3,860
Operating lease liabilities, noncurrent	843	1,597
Noncurrent deferred tax liability, net	14,706	16,025
Other long-term liabilities	489	461
Total liabilities	432,222	626,092
Mezzanine equity:
Series A Convertible Preferred stock, $0.0001 par value; 5,000,000 shares authorized; 115,000 shares issued and outstanding as of September 30, 2024, and December 31, 2023, respectively	121,809	117,638
Stockholders’ equity:
Common stock, $0.0001 par value; 75,000,000 shares authorized; 27,440,968 and 29,908,407 shares issued and outstanding as of September 30, 2024, and December 31, 2023, respectively	3	3
Additional paid-in capital	605,353	608,995
Accumulated other comprehensive income (loss)	(6,275)	6,168
Accumulated deficit	(598,174)	(488,872)
Total stockholders’ equity	907	126,294
Total liabilities, convertible preferred stock and stockholders’ equity	$554,938	$870,024

Condensed Consolidated Statements of Operations

(in thousands, except for share and per share amounts)

	Three Months Ended September 30,		Nine Months Ended September 30,
	2024	2023	2024	2023
Revenue:
Subscription and support	$63,771	$69,962	$196,353	$213,370
Perpetual license	1,106	1,494	4,306	4,317
Total product revenue	64,877	71,456	200,659	217,687
Professional services	1,815	2,665	6,108	7,987
Total revenue	66,692	74,121	206,767	225,674
Cost of revenue:
Subscription and support	18,449	20,853	57,525	66,411
Professional services and other	1,256	2,085	3,703	6,241
Total cost of revenue	19,705	22,938	61,228	72,652
Gross profit	46,987	51,183	145,539	153,022
Operating expenses:
Sales and marketing	16,325	16,860	50,134	46,904
Research and development	11,432	12,740	36,072	37,713
General and administrative	11,051	14,597	38,163	47,369
Depreciation and amortization	11,490	14,262	34,266	44,209
Acquisition-related expenses	—	443	—	2,609
Impairment of goodwill	—	—	87,227	128,755
Total operating expenses	50,298	58,902	245,862	307,559
Loss from operations	(3,311)	(7,719)	(100,323)	(154,537)
Other income (expense):
Interest income (expense), net	2,337	(2,525)	(7,677)	(13,362)
Other income (expense), net	(229)	103	(109)	911
Total other income (expense)	2,108	(2,422)	(7,786)	(12,451)
Loss before benefit from (provision for) income taxes	(1,203)	(10,141)	(108,109)	(166,988)
Benefit from (provision for) income taxes	(530)	1,471	(1,193)	3,126
Net loss	$(1,733)	$(8,670)	$(109,302)	$(163,862)
Preferred stock dividends	(1,406)	(1,344)	(4,171)	(3,988)
Net loss attributable to common stockholders	$(3,139)	$(10,014)	$(113,473)	$(167,850)
Net loss per common share:
Net loss per common share, basic and diluted	$(0.12)	$(0.31)	$(4.07)	$(5.17)
Weighted-average common shares outstanding, basic and diluted	27,292,410	32,579,544	27,850,947	32,438,682

Condensed Consolidated Statements of Comprehensive Income (Loss)

(in thousands)

	Three Months Ended September 30,		Nine Months Ended September 30,
	2024	2023	2024	2023
Net loss	$(1,733)	$(8,670)	$(109,302)	$(163,862)
Other comprehensive income (loss):
Foreign currency translation adjustment	4,615	(4,103)	1,796	(3,248)
Unrealized translation gain (loss) on foreign currency denominated intercompany loans, net of taxes	4,138	(2,588)	2,468	1,111
Interest rate swaps	(14,428)	(3,496)	(16,707)	(3,745)
Other comprehensive income (loss):	$(5,675)	$(10,187)	$(12,443)	$(5,882)
Comprehensive loss	$(7,408)	$(18,857)	$(121,745)	$(169,744)

Condensed Consolidated Statements of Equity

(in thousands, except share amounts)

	Three Months Ended September 30, 2024
Preferred Stock · Common Stock · AdditionalPaid-InCapital · AccumulatedOtherComprehensiveIncome (Loss) · AccumulatedDeficit · TotalStockholders’Equity
Shares · Amount · Shares · Amount
Balance at June 30, 2024	115,000	$120,403		27,265,746		$3		$603,526		$(600)		$(596,441)		$6,488
Dividends accrued - Convertible Preferred Stock	—	1,406		—		—		(1,406)		—		—		(1,406)
Issuance of stock under Company plans, net of shares withheld for tax	—	—		175,222		—		(190)		—		—		(190)
Stock-based compensation	—	—		—		—		3,423		—		—		3,423
Foreign currency translation adjustment	—	—		—		—		—		4,615		—		4,615
Unrealized translation gain (loss) on intercompany loans with foreign subsidiaries	—	—		—		—		—		4,138		—		4,138
Interest rate swaps	—	—		—		—		—		(14,428)		—		(14,428)
Net loss			—		—		—		—		(1,733)		(1,733)
Balance at September 30, 2024	115,000	$121,809		27,440,968		$3		$605,353		$(6,275)		$(598,174)		$907
	Three Months Ended September 30, 2023
Preferred Stock · Common Stock · AdditionalPaid-InCapital · AccumulatedOtherComprehensiveIncome (Loss) · AccumulatedDeficit · TotalStockholders’Equity
Shares · Amount · Shares · Amount
Balance at June 30, 2023	115,000	$114,935		32,654,615		$3		$616,556		$15,415		$(464,190)		$167,784
Dividends accrued - Convertible Preferred Stock	—	1,344		—		—		(1,344)		—		—		(1,344)
Issuance of stock under Company plans, net of shares withheld for tax	—	—		269,754		—		(353)		—		—		(353)
Stock repurchases and retirements	—	—		(783,356)		—		(3,215)		—		—		(3,215)
Stock-based compensation	—	—		—		—		5,360		—		—		5,360
Foreign currency translation adjustment	—	—		—		—		—		(4,103)		—		(4,103)
Unrealized translation gain (loss) on intercompany loans with foreign subsidiaries	—	—		—		—		—		(2,588)		—		(2,588)
Interest rate swaps	—	—		—		—		—		(3,496)		—		(3,496)
Net loss	—	—		—		—		—		—		(8,670)		(8,670)
Balance at September 30, 2023	115,000	$116,279		32,141,013		$3		$617,004		$5,228		$(472,860)		$149,375

Condensed Consolidated Statements of Equity - continued

(in thousands, except share amounts)

	Nine Months Ended September 30, 2024
Preferred Stock · Common Stock · AdditionalPaid-InCapital · AccumulatedOtherComprehensiveIncome (Loss) · AccumulatedDeficit · TotalStockholders’Equity
Shares · Amount · Shares · Amount
Balance at December 31, 2023	115,000	$117,638	29,908,407	$3	$608,995	$6,168	$(488,872)	$126,294
Dividends accrued - Convertible Preferred Stock	—	4,171	—	—	$(4,171)	—	—	(4,171)
Issuance of stock under Company plans, net of shares withheld for tax	—	—	741,266	—	(753)	—	—	(753)
Stock repurchases and retirements	—	—	(3,208,705)	—	(10,796)	—	—	(10,796)
Stock-based compensation	—	—	—	—	12,078	—	—	12,078
Foreign currency translation adjustment	—	—	—	—	—	1,796	—	1,796
Unrealized translation gain (loss) on intercompany loans with foreign subsidiaries	—	—	—	—	—	2,468	—	2,468
Interest rate swaps	—	—	—	—	—	(16,707)	—	(16,707)
Net loss	—	—	—	—	—	—	(109,302)	(109,302)
Balance at September 30, 2024	115,000	$121,809	27,440,968	$3	$605,353	$(6,275)	$(598,174)	$907
	Nine Months Ended September 30, 2023
Preferred Stock · Common Stock · AdditionalPaid-InCapital · AccumulatedOtherComprehensiveIncome (Loss) · AccumulatedDeficit · TotalStockholders’Equity
Shares · Amount · Shares · Amount
Balance at December 31, 2022	115,000	$112,291	32,221,855	$3	$606,755	$11,110	$(308,998)	$308,870
Dividends accrued - Convertible Preferred Stock	—	3,988	—	—	(3,988)	—	—	(3,988)
Issuance of stock under Company plans, net of shares withheld for tax	—	—	702,514	—	(740)	—	—	(740)
Stock repurchases and retirements	—	—	(783,356)	—	(3,215)	—	—	(3,215)
Stock-based compensation	—	—	—	—	18,192	—	—	18,192
Foreign currency translation adjustment	—	—	—	—	—	(3,248)	—	(3,248)
Unrealized translation gain (loss) on intercompany loans with foreign subsidiaries, net of taxes	—	—	—	—	—	1,111	—	1,111
Interest rate swaps	—	—	—	—	—	(3,745)	—	(3,745)
Net loss	—	—	—	—	—	—	(163,862)	(163,862)
Balance at September 30, 2023	115,000	$116,279	32,141,013	$3	$617,004	$5,228	$(472,860)	$149,375

Upland Software, Inc.
Condensed Consolidated Statements of Cash Flows
(unaudited)
	Nine Months Ended September 30,
(In thousands)	2024	2023
Operating activities
Net loss	$(109,302)	$(163,862)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization	41,406	54,475
Deferred income taxes	(1,265)	(2,651)
Amortization of deferred costs	9,152	9,909
Foreign currency re-measurement gain	(759)	(983)
Non-cash interest, net and other income, net	(9,268)	(2,080)
Non-cash stock-based compensation expense	12,078	18,192
Non-cash loss on impairment of goodwill	87,227	128,755
Non-cash loss on retirement of fixed assets	18	46
Changes in operating assets and liabilities, net of purchase business combinations:
Accounts receivable	7,093	10,168
Prepaid expenses and other current assets	(2,705)	(5,405)
Other assets	(7,159)	12,259
Accounts payable	641	(871)
Accrued expenses and other liabilities	(1,396)	(4,729)
Deferred revenue	(10,863)	(12,069)
Net cash provided by operating activities	14,898	41,154
Investing activities
Purchase of property and equipment	(562)	(1,034)
Net cash used in investing activities	(562)	(1,034)
Financing activities
Payments of debt costs	(77)	(190)
Payments on notes payable	(181,050)	(39,050)
Stock repurchases and retirement	(10,958)	(3,215)
Taxes paid related to net share settlement of equity awards	(753)	(742)
Issuance of common stock, net of issuance costs	—	2
Additional consideration paid to sellers of businesses	—	(5,550)
Net cash used in financing activities	(192,838)	(48,745)
Effect of exchange rate fluctuations on cash	1,682	(437)
Change in cash and cash equivalents	(176,820)	(9,062)
Cash and cash equivalents, beginning of period	236,559	248,653
Cash and cash equivalents, end of period	$59,739	$239,591
Supplemental disclosures of cash flow information:
Cash paid for interest, net of interest rate swaps	$24,409	$23,147
Cash paid (received) for taxes, net of refunds	$1,802	$6,227

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