Sprout Social, Inc.

11. Business Combinations

NewsWhip Group Holdings Limited

On July 30, 2025, the Company completed its acquisition of all of the outstanding voting shares of NewsWhip, a company incorporated in Ireland that provides real-time social intelligence. NewsWhip’s proprietary real-time media monitoring and predictive analytics provide insights into emerging trends and narratives, enabling the Company to enter the public relations and crisis monitoring space.

Consideration for the acquisition of NewsWhip consisted of an upfront cash payment of $52.3 million, subject to adjustment for cash, indebtedness and working capital, deferred consideration of $3.2 million and up to $10.0 million of an earnout, which is contingent upon NewsWhip’s achievement of financial performance metrics through June 30, 2027. The earnout is payable in cash in two installments. The earnout is considered contingent consideration and is accounted for as a liability initially measured at fair value. As of September 30, 2025, the fair value of the contingent consideration was $8.5 million, of which $4.5 million was recorded within Accrued expenses and other and $4.0 million was recorded within Other noncurrent liabilities in the unaudited condensed consolidated balance sheets. See Note 10 - “Fair Value Measurements” for additional information regarding the fair value determination of the contingent consideration. The deferred consideration primarily includes the value of certain research and development tax credits that were generated by NewsWhip prior to the acquisition date anda holdback amount.

The Company funded the upfront cash payment with a combination of cash on hand and $32 million borrowed under the Facility further described in Note 5 - “Revolving Line of Credit”. For the nine

Sprout Social, Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited)

months ended September 30, 2025, the Company incurred $1.8 million of acquisition-related costs, which were primarily related to advisory and legal costs, and were recorded within General and administrative expense in the unaudited condensed consolidated statements of operations.

The excess of purchase consideration over the fair value of net assets acquired was recorded as goodwill, and isprimarily attributable to expanded market opportunities from integrating the acquired developed technologies with the Company’s offerings. The goodwill is not deductible for income tax purposes.

The fair values of the tangible and identifiable intangible assets acquired and liabilities assumed are based on management’s estimates and assumptions. These estimates are based on preliminary information and may be subject to further revision as additional information is obtained during the measurement period, which may last up to 12 months from the date of the acquisition. The primary areas that remain preliminary as of September 30, 2025 relate to thefair values of intangible assets acquired, contingent consideration payable, goodwill and related deferred tax impacts. The Company expects to finalize the fair value measurements as soon as practicable, but not later than 12 months from the date of acquisition.

The following table summarizes the preliminary allocation of purchase price to the estimated fair values of assets acquired and liabilities assumed as of the acquisition date (in thousands):

Sprout Social, Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited)

The Company engaged a third-party valuation expert to aid its analysis of the identifiable intangible assets acquired. All estimates, key assumptions and forecasts were either provided by or reviewed by the Company. While the Company chose to utilize a third-party valuation expert for assistance, the fair value analysis and related valuations reflect the conclusions of management and not those of any third party.

The fair values of the acquired technology and the trademark identified intangible assets were determined utilizing the relief from royalty method under the income approach. The fair values of the customer relationships and contract backlog were valued using the multi-period excess-earnings method. The Company applied judgment which involved the use of assumptions with respect to revenue growth rates, customer attrition rate, discount rate, royalty rate, obsolescence rate and total operating expenses.

The fair value of the contingent consideration was determined using a scenario-based approach. This fair value measurement was based on unobservable inputs, including management estimates and assumptions about future revenues and a discount rate, and is, therefore, classified as Level 3 within the fair value hierarchy presented in Note 10 - “Fair Value Measurements”. The contingent consideration is remeasured to fair value at each reporting date until the contingency is resolved. Changes in the fair value of contingent consideration, other than measurement period adjustments, are recorded within General and administrative expenses within the condensed consolidated statements of operations.

Acquired intangible assets are being amortized over the estimated useful lives on a straight-line basis. The following table summarizes the estimated preliminary fair values (in thousands) and estimated useful lives for the identifiable intangible assets acquired as of the acquisition date:

In connection with the acquisition, the Company acquired net operating loss carryforwards of approximately $31.8 million attributable to NewsWhip's Irish operations, against which a full valuation allowance has been recorded on the related deferred tax asset.

The Company has included the financial results of NewsWhip in its unaudited condensed consolidated financial statements from the date of acquisition. Separate financial results and pro forma financial information for NewsWhip have not been presented as the effect of this acquisition was not material to the Company’s financial results.

Sprout Social, Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited)

Goodwill

The changes in the carrying amount of goodwill during the nine months ended September 30, 2025 were as follows (in thousands):