Shutterstock, Inc.
For the period ended Sep 30, 2026. Filed Nov 5, 2026.
View on SEC.govAbout 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, 2026 · Filed Nov 5, 2026
SSTK$2.97-3.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-06-30; filed 2026-08-07.
0001549346-26-000029
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-09-30; filed 2026-11-05.
0001549346-26-000034
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 156 previous paragraphs and 155 current paragraphs.
100 unchanged; 52 reworded; 3 added; 3 removed; 1 previous and 0 current paragraphs rearranged.
Tables are not compared: 13 previous and 13 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 (3)
Current report
For the three months ended September 30, 2025, the net effect of discrete items decreased the effective tax rate by 19.5%. The discrete items for the three months ended September 30, 2025 primarily relate to a decrease in the valuation allowance and a release of an uncertain tax position. Excluding discrete items, our effective tax rate would have been 76.9% for the three months ended September 30, 2025.
Current report
Comparison of the Nine Months Ended September 30, 2026 and 2025
Current report
For the nine months ended September 30, 2025, the net effect of discrete items decreased the effective tax rate by 9.6%. The discrete items for the nine months ended September 30, 2025 primarily relate to a decrease in the valuation allowance and a release of an uncertain tax position, partially offset by shortfalls on equity award vestings. Excluding discrete items, our effective tax rate would have been 44.8% for the nine months ended September 30, 2025.
Removed paragraphs (3)
Previous report
For the three months ended June 30, 2025, the net effect of discrete items increased the effective tax rate by 2.3%. The discrete items for the three months ended June 30, 2025 primarily relate to shortfalls on equity award vestings, partially offset by a decrease in valuation allowance. Excluding discrete items, our effective tax rate would have been 29.4% for the three months ended June 30, 2025.
Previous report
Comparison of the Six Months Ended June 30, 2026 and 2025
Previous report
For the six months ended June 30, 2025, the net effect of discrete items decreased the effective tax rate by 4.7%. The discrete items for the six months ended June 30, 2025 relate to shortfalls on equity award vestings. Excluding discrete items, our effective tax rate would have been 29.0% for the six months ended June 30, 2025.
Reworded paragraphs (52)
Previous wording
Merger Agreement with Getty Images
Current wording
Terminated Merger Agreement with Getty Images
Previous wording
On June 30, 2026, Getty Images filed an 8-K announcing that its Board of Directors unanimously resolved to terminate the Merger Agreement.
Current wording
On June 30, 2026, Getty Images filed an 8-K announcing that its Board of Directors unanimously resolved to terminate the Merger Agreement. The Merger Agreement was terminated on July 7, 2026.
Previous wording
•Generative AI Content - consisting of images generated from algorithms trained with high-quality, ethically sourced content. Customers can generate images by entering a description of their desired content into model prompts.
Current wording
•Generative AI Content - consisting of images generated from algorithms trained with high-quality, licensable content. Customers can generate images by entering a description of their desired content into model prompts.
Previous wording
We have seen increased demand for access to our metadata for machine learning and generative artificial intelligence model training. We offer ethically sourced and licenseable metadata at industry leading scales and quality. Our metadata customer base ranges from large technology and media companies to smaller start-up organizations.
Current wording
We have seen increased demand for access to our metadata for machine learning and generative artificial intelligence model training. We offer licensable metadata at industry leading scales and quality. Our metadata customer base ranges from large technology and media companies to smaller start-up organizations.
Previous wording
Subscribers, subscriber revenue and average revenue per customer from acquisitions are included in these metrics beginning twelve months after the closing of the respective business combination. Accordingly, the metrics include Subscribers, Subscriber revenue, and Average revenue per customer from Backgrid beginning February 2025. 2025 metrics include the counts and revenues from Envato for the three and six months ended June 30, 2025, which was acquired in July 22, 2024.
Current wording
Subscribers, subscriber revenue and average revenue per customer from acquisitions are included in these metrics beginning twelve months after the closing of the respective business combination. Accordingly, the metrics include Subscribers, Subscriber revenue, and Average revenue per customer from Backgrid beginning February 2025. The 2025 metrics include the counts and revenues from Envato for the three and nine months ended September 30, 2025, which was acquired in July 22, 2024.
Previous wording
The following tables summarize our key operating metrics, which are unaudited, for the three and six months ended June 30, 2026 and 2025:
Current wording
The following tables summarize our key operating metrics, which are unaudited, for the three and nine months ended September 30, 2026 and 2025:
Previous wording
Data, Distribution, and Services: Our Data, Distribution, and Services offering addresses customer demand for products and services that are beyond our stock image, footage music and 3D model licenses. We have seen increased demand for access to our metadata for machine learning and generative artificial intelligence model training. We offer ethically sourced and licenseable metadata at unique scales and quality. Our metadata customer base ranges from large technology and media companies to smaller start-up organizations.
Current wording
Data, Distribution, and Services: Our Data, Distribution, and Services offering addresses customer demand for products and services that are beyond our stock image, footage music and 3D model licenses. We have seen increased demand for access to our metadata for machine learning and generative artificial intelligence model training. We offer licensable metadata at unique scales and quality. Our metadata customer base ranges from large technology and media companies to smaller start-up organizations.
Previous wording
The Company’s revenues by distribution channel for the three and six months ended June 30, 2026 and 2025 are as follows (in thousands):
Current wording
The Company’s revenues by product offering for the three and nine months ended September 30, 2026 and 2025 are as follows (in thousands):
Previous wording
Revenue decreased by $45.2 million, or 17%, to $221.8 million for the three months ended June 30, 2026, compared to the same period in 2025. On a constant currency basis, revenue decreased by 17% in the three months ended June 30, 2026, compared to the same period in 2025.
Current wording
Revenue decreased by $86.2 million, or 33%, to $173.9 million for the three months ended September 30, 2026, compared to the same period in 2025. On a constant currency basis, revenue decreased by 33% in the three months ended September 30, 2026, compared to the same period in 2025.
Previous wording
Our Content revenues decreased by 17%, to $165.7 million in the three months ended June 30, 2026, compared to the same period in 2025. On a constant currency basis, content revenue decreased by 16% in the three months ended June 30, 2026, compared to the same period in 2025. During the three months ended June 30, 2026, the reduction in our Content revenue was driven primarily by weakness in new customer acquisition.
Current wording
Our Content revenues decreased by 19%, to $158.1 million in the three months ended September 30, 2026, compared to the same period in 2025. On a constant currency basis, content revenue decreased by 18% in the three months ended September 30, 2026, compared to the same period in 2025. During the three months ended September 30, 2026, the reduction in our Content revenue was driven primarily by weakness in new customer acquisition.
Previous wording
Our Data, Distribution, and Services revenues decreased by 16%, to $56.1 million in the three months ended June 30, 2026, compared to the same period in 2025. On a constant currency basis, Data, Distribution, and Services revenues decreased by 19% in the three months ended June 30, 2026, compared to the same period in 2025. The decrease in Data, Distribution, and Services revenues was primarily driven by a decline in our data offering, which decreased by 11% in the three months ended June 30, 2026 compared to the same period in 2025. Revenue recognition in our data offering may vary from quarter-to-quarter based on the delivery timing of metadata licenses.
Current wording
Our Data, Distribution, and Services revenues decreased by 76%, to $15.8 million in the three months ended September 30, 2026, compared to the same period in 2025. On a constant currency basis, Data, Distribution, and Services revenues decreased by 76% in the three months ended September 30, 2026, compared to the same period in 2025. The decrease in Data, Distribution, and Services revenues was primarily driven by a decline in our data offering, which decreased by 91% in the three months ended September 30, 2026 compared to the same period in 2025. Revenue recognition in our data offering may vary from quarter-to-quarter based on the delivery timing of metadata licensed assets.
Previous wording
Changes in our revenue by region were as follows: revenue from North America decreased by $29.8 million, or 20%, to $118.1 million, revenue from Europe decreased by $5.2 million, or 8%, to $59.2 million and revenue from outside Europe and North America decreased by $10.2 million, or 19%, to $44.5 million, in the three months ended June 30, 2026 compared to the same period in 2025.
Current wording
Changes in our revenue by region were as follows: revenue from North America decreased by $61.8 million, or 43%, to $81.0 million, revenue from Europe decreased by $12.9 million, or 20%, to $50.7 million and revenue from Rest of World decreased by $11.5 million, or 21%, to $42.2 million, in the three months ended September 30, 2026 compared to the same period in 2025.
Previous wording
Cost of Revenue. Cost of revenue decreased by $12.2 million to $93.8 million in the three months ended June 30, 2026 compared to the same period in 2025. This decrease is primarily due to lower royalty expenses as a result of the decline in revenue for the quarter. As a percentage of revenue, cost of revenue increased to 42% for the three months ended June 30, 2026, from 40% for the same period in 2025, and this increase related to AI token usage fees and website hosting costs which do not fluctuate with revenue. We expect that our cost of revenue will continue to fluctuate in-line with changes in revenue.
Current wording
Cost of Revenue. Cost of revenue decreased by $18.8 million to $83.7 million in the three months ended September 30, 2026 compared to the same period in 2025. This decrease is primarily due to lower royalty expenses as a result of the decline in revenue for the quarter. As a percentage of revenue, cost of revenue increased to 48% for the three months ended September 30, 2026, from 39% for the same period in 2025. This increase was related to AI token usage fees and website hosting costs which do not fluctuate with revenue. We expect that our cost of revenue will continue to fluctuate in-line with changes in revenue.
Previous wording
Sales and Marketing. Sales and marketing expenses decreased by $9.1 million, or 16%, to $48.0 million in the three months ended June 30, 2026 compared to the same period in 2025. This was driven by a decrease in brand and performance-based marketing expenses. As a percentage of revenue, sales and marketing expenses increased to 22% for the three months ended
Current wording
Sales and Marketing. Sales and marketing expenses decreased by $15.4 million, or 26%, to $43.9 million in the three months ended September 30, 2026 compared to the same period in 2025. This was driven by a decrease in brand and performance-based marketing expenses. As a percentage of revenue, sales and marketing expenses increased to 25% for the three months ended September 30, 2026, from 23% for the same period in 2025. We expect sales and marketing expenses to continue to fluctuate as we optimize our sales channels and invest in new customer acquisition, products and geographies.
Previous wording
Product Development. Product development expenses decreased by $3.2 million to $17.6 million in the three months ended June 30, 2026 compared to the same period in 2025. The decrease in product development was driven by a decrease in employee-related costs and decreases in software licenses and third-party contractor related costs, net of capitalized labor. We expect product development expenses, of which a portion will be capitalized, to continue in the foreseeable future, as we pursue opportunities to invest in developing new products and internal tools and enhance the functionality of our existing products and technologies.
Current wording
Product Development. Product development expenses decreased by $8.1 million to $14.2 million in the three months ended September 30, 2026 compared to the same period in 2025. The decrease in product development was driven by a decrease in employee-related costs offset by increases in software licenses and third-party contractor related costs, net of capitalized labor. We expect product development expenses, of which a portion will be capitalized, to continue in the foreseeable future, as we pursue opportunities to invest in developing new products and internal tools and enhance the functionality of our existing products andtechnologies.
Previous wording
General and Administrative. General and administrative expenses decreased by $4.5 million, to $43.9 million, in the three months ended June 30, 2026 compared to the same period in 2025. The decrease was driven by decreases in employee-related costs, offset by $3.7 million of expenses associated with the Merger.
Current wording
General and Administrative. General and administrative expenses decreased by $15.6 million, to $27.7 million, in the three months ended September 30, 2026 compared to the same period in 2025. The decrease was driven by decreases in employee-related costs, offset by $0.5 million of expenses associated with the Merger.
Previous wording
Goodwill Impairment. As of June 30, 2026, management determined that Getty Image's June 30, 2026 announcement to terminate the Merger Agreement resulted in a triggering event and required the performance of a quantitative goodwill impairment test. The analysis resulted in a goodwill impairment charge of $173.7 million.
Current wording
Goodwill Impairment. As of September 30, 2026, management determined that the suspension of dividends announced on July 22, 2026 resulted in a triggering event for the third quarter of 2026 and required the performance of a quantitative goodwill impairment test. The analysis resulted in a goodwill impairment charge of $203.3 million.
Previous wording
Interest Expense. In the three months ended June 30, 2026 and June 30, 2025, we recognized interest expense of $3.8 million and $4.2 million, respectively, related to our credit facility and the amortization of deferred financing fees. Interest expense for the three months ended June 30, 2026 decreased due to lower interest rates in the three months ended June 30, 2026 as compared to the same period in 2025.
Current wording
Interest Expense. In the three months ended September 30, 2026 and September 30, 2025, we recognized interest expense of $3.6 million and $4.2 million, respectively, related to our credit facility and the amortization of deferred financing fees. Interest expense for the three months ended September 30, 2026 decreased due to lower interest rates and a lower outstanding principal balance in the three months ended September 30, 2026 as compared to the same period in 2025.
Previous wording
Other (Expense) / Income, Net. In the three months ended June 30, 2026, other (expense) / income, net was driven by $3.0 million of unrealized losses related to our investment in Meitu, Inc. In addition, other income, net had $0.5 million of interest income and $0.6 million of unrealized foreign currency losses. In the three months ended June 30, 2025, other income, net was primarily driven by $18.0 million of unrealized gains related to our investment in Meitu, Inc. In addition, other income, net had $1.1 million of interest income and $1.5 million of unrealized foreign currency gains. As we increase the volume of business transacted in foreign currencies resulting from international expansion and as currency rates fluctuate, we expect foreign currency gains and losses to continue to fluctuate.
Current wording
Other (Expense) / Income, Net. In the three months ended September 30, 2026, other (expense) / income, net was driven by $0.4 million of unrealized losses related to our investment in Meitu, Inc. In addition, other income, net had $0.1 million of interest income and $1.6 million of unrealized foreign currency gains. In the three months ended September 30, 2025, other income, net was primarily driven by $2.8 million of unrealized gains related to our investment in Meitu, Inc. In addition, other income, net had $0.9 million of interest income and $0.6 million of unrealized foreign currency gains. As we increase the volume of business transacted in foreign currencies resulting from international expansion and as currency rates fluctuate, we expect foreign currency gains and losses to continue to fluctuate.
Previous wording
Income Taxes. The income tax expense decreased by $18.7 million for the three months ended June 30, 2026, compared to the same period in 2025. Our effective tax rates were a net benefit of 3.1% and an expense of 31.7% for the three months ended June 30, 2026 and 2025, respectively.
Current wording
Income Taxes. The income tax expense decreased by $20.8 million for the three months ended September 30, 2026, compared to the same period in 2025. Our effective tax rates were a net benefit of 1.4% and an expense 57.4% for the three months ended September 30, 2026 and 2025, respectively.
Previous wording
For the three months ended June 30, 2026, the net effect of discrete items decreased the effective tax rate by 45.3%. The discrete items for the three months ended June 30, 2026 primarily relate to the book goodwill impairment which is non-deductible for tax purposes, partially offset by shortfalls on equity award vestings. Excluding discrete items, our effective tax rate would have been 48.4% for the three months ended June 30, 2026.
Current wording
For the three months ended September 30, 2026, the net effect of discrete items decreased the effective tax rate by 35.2%. The discrete items for the three months ended September 30, 2026 primarily relate to the book goodwill impairment which is non-deductible for tax purposes, partially offset by shortfalls on equity award vestings and prior-years tax return finalization. Excluding discrete items, our effective tax rate would have been 36.6% for the three months ended September 30, 2026.
Previous wording
Revenue decreased by $88.6 million, or 17%, to $421.0 million in the six months ended June 30, 2026, compared to the same period in 2025. On a constant currency basis, revenue decreased by 18% in the six months ended June 30, 2026, compared to the same period in 2025.
Current wording
Revenue decreased by $174.8 million, or 23%, to $594.9 million in the nine months ended September 30, 2026, compared to the same period in 2025. On a constant currency basis, revenue decreased by 23% in the nine months ended September 30, 2026, compared to the same period in 2025.
Previous wording
Our Content revenues decreased by 15%, to $343.8 million in the six months ended June 30, 2026, compared to the same period in 2025. On a constant currency basis, content revenue decreased by 15% in the six months ended June 30, 2026, compared to the same period in 2025. During the six months ended June 30, 2026, the reduction in our Content revenue was driven primarily by weakness in new customer acquisition.
Current wording
Our Content revenues decreased by 16%, to $501.9 million in the nine months ended September 30, 2026, compared to the same period in 2025. On a constant currency basis, content revenue decreased by 16% in the nine months ended September 30, 2026, compared to the same period in 2025. During the nine months ended September 30, 2026, the reduction in our Content revenue was driven primarily by weakness in new customer acquisition.
Previous wording
Our Data, Distribution, and Services revenues decreased by 28%, to $77.2 million in the six months ended June 30, 2026, compared to the same period in 2025. Foreign currency fluctuations did not have a significant impact on our Data, Distribution, and Services revenues in the six months ended June 30, 2026. The decrease in Data, Distribution, and Services revenues was primarily driven by a decline in our data offering, which decreased by 26% in the six months ended June 30, 2026 compared to the same period in 2025. Revenue recognition in our data offering may vary from quarter-to-quarter based on the delivery timing of metadata licenses.
Current wording
Our Data, Distribution, and Services revenues decreased by 46%, to $93.0 million in the nine months ended September 30, 2026, compared to the same period in 2025. Foreign currency fluctuations did not have a significant impact on our Data, Distribution, and Services revenues in the nine months ended September 30, 2026. The decrease in Data, Distribution, and Services revenues was primarily driven by a decline in our data offering, which decreased by 60% in the nine months ended September 30, 2026 compared to the same period in 2025. Revenue recognition in our data offering may vary from quarter-to-quarter based on the delivery timing ofmetadata licensed assets.
Previous wording
Changes in our revenue by region were as follows: revenue from North America decreased by $60.9 million, or 23%, to $207.2 million, revenue from Europe decreased by $8.7 million, or 7%, to $121.9 million and revenue from outside Europe and North America decreased by $19.0 million, or 17%, to $91.9 million, in the six months ended June 30, 2026, compared to the same period in 2025.
Current wording
Changes in our revenue by region were as follows: revenue from North America decreased by$122.7 million, or 30%, to $288.2 million, revenue from Europe decreased by $21.6 million, or 11%, to $172.6 million and revenue from Rest of World decreased by $30.5 million, or 19%, to $134.1 million, in the nine months ended September 30, 2026, compared to the same period in 2025.
Previous wording
Cost of Revenue. Cost of revenue decreased by $18.3 million, or 9%, to $188.6 million in the six months ended June 30, 2026 compared to the same period in 2025. This decrease was driven by decreased royalty and content costs, costs associated with website hosting, hardware and software licenses, and employee related costs, Giphy Retention Compensation expenses, and depreciation and amortization driven by the acquisition of Envato. As a percent of revenue, cost of revenue increased to 45% for the six months ended June 30, 2026, from 41% for the same period in 2025. We expect that our cost of revenue will continue to fluctuate in line with changes in revenue.
Current wording
Cost of Revenue. Cost of revenue decreased by $37.2 million, or 12%, to $272.3 million in the nine months ended September 30, 2026 compared to the same period in 2025. This decrease was driven by decreased royalty and content costs, costs associated with website hosting, hardware and software licenses, employee related costs, and Giphy Retention Compensation expenses. As a percent of revenue, cost of revenue incre ased to 46% for the nine months ended September 30, 2026, from 40% for the same period in 2025. This increase was related to AI token usage fees and website hosting costs which do not fluctuate with revenue. We expect that our cost of revenue will continue to fluctuate in line with changes in revenue.
Previous wording
Sales and Marketing. Sales and marketing expenses decreased by $14.1 million, or 13%, to $96.4 million in the six months ended June 30, 2026 compared to the same period in 2025. This decrease was driven by a decrease in brand and performance-based marketing expenses. As a percentage of revenue, sales and marketing expenses increased to 23% for the six months ended June 30, 2026, from 22% for the same period in 2025. We expect sales and marketing expenses to continue to fluctuate as we optimize our sales channels and invest in new customer acquisition, products and geographies.
Current wording
Sales and Marketing. Sales and marketing expenses decreased by $29.5 million, or 17%, to $140.3 million in the nine months ended September 30, 2026 compared to the same period in 2025. This decrease was driven by a decrease in brand and performance-based marketing expenses. As a percentage of revenue, sales and marketing expenses increased to 24% for the nine months ended September 30, 2026, from 22% for the same period in 2025. We expect sales and marketing expenses to continue to fluctuate as we optimize our sales channels and invest in new customer acquisition, products and geographies.
Previous wording
Product Development. Product development expenses decreased by $3.6 million, or 9%, to $37.0 million in the six months ended June 30, 2026 as compared to the same period in 2025. The decrease in product development was driven by a decrease in employee-related costs and decreases in software licenses and third-party contractor related costs, net of capitalized labor. We expect product development expenses, of which a portion will be capitalized, to continue in the foreseeable future, as we pursue opportunities to invest in developing new products and internal tools and enhance the functionality of our existing products and technologies.
Current wording
Product Development. Product development expenses decreased by $11.8 million, or 19%, to $51.2 million in the nine months ended September 30, 2026 as compared to the same period in 2025. The decrease in product development was driven by a decrease in employee-related costs offset byincreases in software licenses and third-party contractor related costs, net of capitalized labor. We expect product development expenses, of which a portion will be capitalized, to continue in the foreseeable future, as we pursue opportunities to invest in developing new products and internal tools and enhance the functionality of our existing products and technologies.
Previous wording
General and Administrative. General and administrative expenses increased by $4.8 million, or 4%, to $111.5 million in the six months ended June 30, 2026 compared to the same period in 2025. The increase was driven by $6.5 million of expenses associated with the Merger, increases in legal contingencies of $33.0 million (see “Note 15 — Commitments and Contingencies — Legal Matters” for more information), offset by decreases in employee-related costs.
Current wording
General and Administrative. General and administrative expenses decreased by $10.8 million, or 7%, to $139.3 million in the nine months ended September 30, 2026 compared to the same period in 2025. The decrease was driven by decreases in employee-related costs offset by an increase in legal contingencies of $33.6 million.
Previous wording
Goodwill Impairment. As of June 30, 2026, management determined that Getty Image's June 30, 2026 announcement to terminate the Merger Agreement resulted in a triggering event and required the performance of a quantitative goodwill impairment test. The analysis resulting in a goodwill impairment charge of $173.7 million.
Current wording
Goodwill Impairment. Management determined that Getty Image's June 30, 2026 announcement to terminate the Merger Agreement and the suspension of dividends announced on July 22, 2026 resulted in triggering events requiring the performance of quantitative goodwill impairment tests in the second and third quarters of 2026, respectively. The impairment tests resulted in goodwill impairment charges of $377.1 million.
Previous wording
Interest Expense. In the six months ended June 30, 2026 and June 30, 2025, we recognized interest expense of $7.6 million and $8.5 million, respectively related to our credit facility and the amortization of deferred financing fees. Interest expense for the six months ended June 30, 2026 decreased due to lower interest rates in the six months ended June 30, 2026 as compared to the same period in 2025.
Current wording
Interest Expense. In the nine months ended September 30, 2026 and September 30, 2025, we recognized interest expense of $11.2 million and $12.7 million, respectively related to our credit facility and the amortization of deferred financing fees. Interest expense for the nine months ended September 30, 2026 decreased due to lower interest rates and a lower outstanding principal balance in the nine months ended September 30, 2026 as compared to the same period in 2025.
Previous wording
Other (Expense) / Income, Net. In the six months ended June 30, 2026, other (expense) / income decreased by $43.7 million, or 161%, to ($16.5 million). In the six months ended June 30, 2026, other (expense) / income, net was driven by $18.3 million of unrealized losses related to our investment in Meitu, Inc. In addition, other income, net had $1.3 million of interest income and $0.5 million of unrealized foreign currency losses. In the six months ended June 30, 2025, other income, net was primarily driven by $31.3 million of unrealized gains related to our investment in Meitu, Inc. In addition, other income, net had $2.0 million of interest income and $1.2 million of unrealized foreign currency gains. As we increase the volume of business transacted in foreign currencies resulting from international expansion and as currency rates fluctuate, we expect foreign currency gains and losses to continue to fluctuate.
Current wording
Other (Expense) / Income, Net. In the nine months ended September 30, 2026, other (expense) / income decreased by $44.7 million, or 148%, to ($14.4 million). In the nine months ended September 30, 2026, other (expense) / income, net was driven by $17.9 million of unrealized losses related to our investment in Meitu, Inc. In addition, other income, net had $1.4 million of interest income and $2.1 million of unrealized foreign currency gains. In the nine months ended September 30, 2025, other income, net was primarily driven by $34.1 million of unrealized gains related to our investment in Meitu, Inc. In addition, other income, net had $2.9 million of interest income and $1.7 million of unrealized foreign currency gains. As we increase the volume of business transacted in foreign currencies resulting from international expansion and as currency rates fluctuate, we expect foreign currency gains and losses to continue to fluctuate.
Previous wording
Income Taxes. Income tax expense decreased by $22.2 million for the six months ended June 30, 2026, compared to the same period in 2025. Our effective tax rates were a benefit of 3.2% and an expense of 24.3% for the six months ended June 30, 2026 and 2025, respectively.
Current wording
Income Taxes. Income tax expense decreased by $43.0 million for the nine months ended September 30, 2026, compared to the same period in 2025. Our effective tax rates were a benefit of 2.3% and an expense of 35.2% for the nine months ended September 30, 2026 and 2025, respectively.
Previous wording
For the six months ended June 30, 2026, the net effect of discrete items decreased the effective tax rate by 42.5%. The discrete items for the six months ended June 30, 2026, primarily relate to the book goodwill impairment, which is non-deductible for tax purposes, partially offset by shortfalls on equity award vestings. Excluding discrete items, our effective tax rate would have been 45.7% for the six months ended June 30, 2026.
Current wording
For the nine months ended September 30, 2026, the net effect of discrete items decreased the effective tax rate by 38.9%. The discrete items for the nine months ended September 30, 2026, primarily relate to the book goodwill impairment, which is non-deductible for tax purposes, partially offset by shortfalls on equity award vestings and prior-years tax return finalization. Excluding discrete items, our effective tax rate would have been 41.2% for the nine months ended September 30, 2026.
Previous wording
As of June 30, 2026, we had cash and cash equivalents totaling $133.2 million which consisted primarily of bank deposits. Since inception, we have financed our operations primarily through cash flows generated from operations. In addition, if necessary, we have the ability to draw on our A&R Credit Agreement.
Current wording
As of September 30, 2026, we had cash and cash equivalents totaling $110.5 million which consisted primarily of bank deposits. Since inception, we have financed our operations primarily through cash flows generated from operations. In addition, if necessary, we have the ability to draw on our A&R Credit Agreement.
Previous wording
We declared and paid cash dividends of $0.72 per share of common stock, or $26.0 million during the six months ended June 30, 2026.
Current wording
We declared and paid cash dividends of $0.72 per share of common stock, or $26.0 million during the nine months ended September 30, 2026. On July 22, 2026, the Board of Directors suspended the payment of the quarterly dividend.
Previous wording
As of June 30, 2026, we have repurchased approximately 5.5 million shares of our common stock in total since 2015 under the Share repurchase programs (including the 2015 and 2017 Share Repurchase Programs and the 2023 Share Repurchase Program) at an average per-share cost of $48.86. During the three and six months ended June 30, 2026 and 2025, we did not repurchase shares of our common stock. As of June 30, 2026, we had $30.2 million of remaining authorization for repurchases under the Share Repurchase Program.
Current wording
As of September 30, 2026, we have repurchased approximately 5.5 million shares of our common stock in total since 2015 under the Share repurchase programs (including the 2015 and 2017 Share Repurchase Programs and the 2023 Share Repurchase Program) at an average per-share cost of $48.86. During the three and nine months ended September 30, 2026 and 2025, we did not repurchase shares of our common stock. As of September 30, 2026, we had $30.2 million of remaining authorization for repurchases under the Share Repurchase Program.
Previous wording
On July 22, 2024, we entered into an amended and restated credit agreement (the “A&R Credit Agreement”), which was entered into among us, as borrower, certain of our direct and indirect subsidiaries as guarantors, the lenders party thereto, and Bank of America, N.A., as Administrative Agent for the lenders. The A&R Credit Agreement provides for a five-year (i) senior unsecured term loan facility (the “Term Loan”) in an aggregate principal amount of $125 million and (ii) senior unsecured revolving credit facility (the “Revolver”) in an aggregate principal amount of $250 million. The A&R Credit Agreement provides for a letter of credit subfacility and a swingline facility.
Current wording
On July 22, 2024, we entered into an amended and restated credit agreement (the “A&R Credit Agreement”), which was entered into among us, as borrower, certain of our direct and indirect subsidiaries as guarantors, the lenders party thereto, and Bank of America, N.A., as Administrative Agent for the lenders. The A&R Credit Agreement provides for a five-year (i) senior unsecured term loan facility (the “Term Loan”) in an aggregate principal amount of $125 million and (ii) senior unsecured revolving credit facility (the “Revolver”) in an aggregate principal amount of $250 million. The A&R Credit Agreement provides for a letter of credit sub-facility and a swingline facility.
Previous wording
As of June 30, 2026, we had a remaining borrowing capacity of $94 million, net of standby letters of credit.
Current wording
During the third quarter of 2026, the Company repaid $30.0 million of outstanding principal on the Revolver. The repayment was funded using cash generated from operations. As of September 30, 2026, we had a remaining borrowing capacity of $123.7 million, net of standby letters of credit.
Previous wording
For the three and six months ended June 30, 2026, we recognized interest expense of $3.8 million and $7.6 million, respectively. As of June 30, 2026, unamortized debt issuance cost related to the Term Loan - A&R Credit Agreement is $0.5 million.
Current wording
For the three and nine months ended September 30, 2026, we recognized interest expense of $3.6 million and $11.2 million, respectively. As of September 30, 2026, unamortized debt issuance cost related to the Term Loan - A&R Credit Agreement is $0.4 million.
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Previous report — wording carried elsewhere
June 30, 2026, from 21% for the same period in 2025. We expect sales and marketing expenses to continue to fluctuate as we optimize our sales channels and invest in new customer acquisition, products and geographies.