PROCORE TECHNOLOGIES, INC.

1. ORGANIZATION AND DESCRIPTION OF BUSINESS

Description of business

Procore Technologies, Inc. (together with its subsidiaries, “Procore” or the “Company”) provides a cloud-based construction management platform and related products and services that allow the construction industry’s key stakeholders, such as owners, general contractors, and specialty contractors, to collaborate on construction projects.

The Company was incorporated in California in 2002 and re-incorporated in Delaware in 2014. The Company is headquartered in Carpinteria, California, and has operations globally.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of presentation

The accompanying condensed consolidated financial statements include the interim financial statements of Procore. The condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP” or “U.S. GAAP”) and are unaudited. Certain information and disclosures normally included in consolidated financial statements prepared in accordance with U.S. GAAP have been condensed or omitted. Accordingly, these condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes for the year ended December 31, 2025. The condensed consolidated balance sheet information as of December 31, 2025 has been derived from the Company’s audited consolidated financial statements. The condensed consolidated financial statements have been prepared on a basis consistent with that used to prepare the audited annual consolidated financial statements and include, in the opinion of management, all adjustments, consisting of normal recurring items, necessary for the fair statement of the condensed consolidated financial statements. All intercompany balances and transactions have been eliminated in consolidation.

Use of estimates

The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Management periodically evaluates its estimates and assumptions for continued reasonableness, primarily with respect to revenue recognition, the period of benefit of contract cost assets, the fair value of assets acquired and liabilities assumed in a business combination or asset acquisition, stock-based compensation expense, the recoverability of goodwill and long-lived assets, useful lives of long-lived assets, capitalization of software development costs, income taxes, including related reserves and allowances, provision for credit losses, incremental borrowing rates and estimation of lease terms applied in lease accounting, fair value of convertible notes, and self-insurance reserve estimates. Appropriate adjustments, if any, to the estimates used are made prospectively based upon such periodic evaluation. Management bases its estimates on historical experience and on various other assumptions that management believes to be reasonable. Actual results could differ from the Company’s estimates.

Segments

The Company operates as a single operating segment, which also represents a single reportable segment. Operating segments are defined as components of an enterprise for which separate financial information is evaluated regularly by the chief operating decision maker (“CODM”), in deciding how to allocate resources and assess performance. The Company’s CODM is its Chief Executive Officer.

In recent years, the Company has completed a number of acquisitions, which have allowed it to expand its platform capabilities and related products and services. The Company generates substantially all of its revenue from subscriptions to access its software products and related support. The CODM does not regularly review discrete operating results for individual products, services, acquired businesses, geographic regions, or other components of the Company for purposes of assessing performance or allocating resources. As a result, the Company operates as a single operating segment.

The CODM uses net income (loss), as reported on the Company’s condensed consolidated statements of operations and comprehensive income (loss), as its measure of segment profit or loss; and total assets, as reported on the Company’s condensed consolidated balance sheets, to assess performance, monitor budget versus actual results, evaluate potential acquisitions, and allocate resources. Significant segment expenses and assets are consistent with those reported in the condensed consolidated statements of operations and comprehensive income (loss) and condensed consolidated balance sheets, respectively. The CODM also uses net income (loss) and total assets when comparing the Company’s financial results and financial condition versus comparable companies.

Business combinations

The Company assesses whether an acquisition is a business combination or an asset acquisition. If substantially all of the gross assets acquired are concentrated in a single asset or group of similar assets, then the acquisition is accounted for as an asset acquisition where the purchase consideration is allocated on a relative fair value basis to the assets acquired. Goodwill is not recorded in an asset acquisition. If the gross assets are not concentrated in a single asset or group of similar assets, then the Company determines if the set of assets acquired represents a business. A business is an integrated set of activities and assets capable of being conducted and managed for the purpose of providing a return. Depending on the nature of the acquisition, judgment may be required to determine if the set of assets acquired is a business combination or not.

The Company applies the acquisition method of accounting for a business combination. Under this method of accounting, assets acquired and liabilities assumed are recorded at their respective fair values at the date of the acquisition. Any excess of the purchase price over the fair value of the net assets acquired is recognized as goodwill. During the measurement period, which may be up to one year from the acquisition date, the Company adjusts the provisional amounts of assets acquired and liabilities assumed with the corresponding offset to goodwill to reflect new information obtained about facts and circumstances that existed as of the acquisition date that, if known, would have affected the measurement of the amounts recognized as of that date. Upon the conclusion of the measurement period or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded within the Company’s condensed consolidated statements of operations and comprehensive income (loss).

Determining the fair value of assets acquired and liabilities assumed requires management’s judgment and often involves the use of significant estimates and assumptions, including assumptions with respect to estimated level of effort and related costs of reproducing or replacing the assets acquired, future cash inflows and outflows, and discount rates, among other items. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Market participants are assumed to be buyers and sellers in the principal (most advantageous) market for the asset or liability. Additionally, fair value measurements for an asset assume the highest and best use of that asset by market participants. As a result, the Company may be required to value the acquired assets at fair value measures that do not reflect its intended use of those assets. Use of different estimates and judgments could yield different results.

Although the Company believes the assumptions and estimates it has made are reasonable and appropriate, they are based in part on historical experience and information that may be obtained from management of the acquired company and are inherently uncertain.

Marketable securities

Investments with stated maturities of greater than three months are classified as marketable securities, which consist of United States (“U.S.”) treasury securities, commercial paper, corporate notes and obligations, and time deposits. All marketable securities held as of September 30, 2026 and December 31, 2025 are classified as available-for-sale debt securities, which are recorded at fair value. The Company’s marketable securities are classified as either short-term or long-term in the accompanying condensed consolidated balance sheets based on the security’s contractual maturity at the balance sheet date. The Company re-evaluates such classifications at each balance sheet date.

The Company periodically assesses its portfolio of marketable securities for impairment. The Company evaluates each investment in an unrealized loss position to determine if any portion of the unrealized loss is related to credit losses. In determining whether a credit loss may exist, the Company considers the extent of the unrealized loss position, any adverse conditions specifically related to the security or the issuer’s operating environment, the pay structure of the security, the issuer’s payment history, and any changes in the issuer’s credit rating. Unrealized losses on marketable securities due to expected credit losses are recognized in Other income (expense), net in the accompanying condensed consolidated statements of operations and comprehensive income (loss), and any excess unrealized gains and losses, net of tax, that are not due to expected credit losses are included in accumulated other comprehensive loss, a component of stockholders’ equity. During the nine months ended September 30, 2026 and 2025, there wereno credit losses recorded on marketable securities. Interest recorded on marketable securities is recorded in interest income, with accretion of discounts, net of amortization of premiums, recorded in accretion income, net, on the accompanying condensed consolidated statements of operations and comprehensive income (loss).

Self-insurance reserves

The Company has elected to partially self-fund its health insurance plan. To reduce its risk related to high-dollar claims, the Company maintains individual stop-loss insurance. The Company estimates its exposure for claims incurred at the end of each reporting period, including claims not yet reported, with the assistance of an independent third-party actuary. As of September 30, 2026 and December 31, 2025, the Company’s self-insurance accrual was $3.3 million and $3.2 million, respectively, included within other current liabilities on the accompanying condensed consolidated balance sheets.

Strategic investments

Investments in equity securities

The Company holds investments in equity securities of certain privately held companies, which do not have readily determinable fair values. The Company does not have a controlling interest or significant influence in these companies. The Company has elected to apply the measurement alternative to measure the non-marketable equity securities at cost, with remeasurements to fair value only upon the occurrence of observable price changes in orderly transactions for the identical or similar securities of the same issuer, or in the event of any impairment. This election is reassessed each reporting period to determine whether a non-marketable equity security has a readily determinable fair value, in which case the security would no longer be eligible for this election. All gains and losses on such equity securities, realized and unrealized, are recorded in Other income (expense), net on the accompanying condensed consolidated statements of operations and comprehensive income (loss). The Company evaluates its non-marketable equity securities for impairment at each reporting period based on a qualitative assessment that considers various potential impairment indicators. If an impairment exists, a loss is recognized in the accompanying condensed consolidated statements of operations and comprehensive income (loss) for the amount by which the carrying value exceeds the fair value of the investment.

Investments in limited partnership funds

The Company also holds investments in certain limited partnership funds. The Company does not hold a controlling interest or significant influence in these limited partnerships. The fair value of such investments is valued using the Net Asset Value (“NAV”) provided by the fund administrator as a practical expedient.

Convertible notes

On August 6, 2026, the Company issued $950.0 million aggregate principal amount of 0.00% convertible senior notes due August 15, 2031 (the “2031 Notes”), in a private placement to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended. Net proceeds from the 2031 Notes were $927.3 million after deducting initial purchasers’ discount and offering expenses of $22.7 million paid by the Company. Debt issuance costs, including the initial purchasers’ commissions and other transaction expenses, are recorded as a reduction to the carrying value of the 2031 Notes and amortized to interest expense using the effective interest method over the term of the 2031 Notes. The amortization of debt issuance costs is recorded to interest expense in the condensed consolidated statements of operations and comprehensive income (loss). The Company used a portion of the net proceeds to pay a portion of the cash consideration for the acquisition of DroneDeploy, Inc., a Delaware corporation (“DroneDeploy”), a leader in reality capture and robotic automation, to pay the cost of capped call transactions of $59.1 million, and to repurchase $175.0 million of shares of its common stock.

Fair value measurements

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. Fair value measurements are based on a fair value hierarchy using three levels of inputs, of which the first two are considered observable and the last is considered unobservable, as follows:

Level 1 Quoted prices in active markets for identical assets or liabilities.

Level 2 Quoted prices for identical or similar assets and liabilities in markets that are not active or observable inputs other than quoted prices in active markets for identical or similar assets or liabilities.

Level 3 Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

As of September 30, 2026 and December 31, 2025, the carrying value of the Company’s financial instruments included in current assets and current liabilities (including accounts receivable, accounts payable, and accrued expenses) approximate fair value due to the short-term nature of such items. The Company measures its cash held in money market funds, marketable securities, and investments in available-for-sale debt securities at fair value each reporting period. The estimation of fair value for available-for-sale debt securities in private companies requires the use of significant unobservable inputs, and as a result, the Company classifies these assets as Level 3 within the fair value hierarchy.

In addition to its cash equivalents and marketable securities, the Company measures the fair value of its outstanding convertible senior notes on a quarterly basis for disclosure purposes. While the Company considers the fair value of the convertible senior notes to be a Level 2 measurement due to limited trading activity of the convertible senior notes, the 2031 Notes are measured at amortized cost on the Company’s condensed consolidated balance sheets. Refer to Note 9 to the condensed consolidated financial statements for further details.

The Company’s investments in equity securities of privately held companies are recorded at fair value on a non-recurring basis. For investments without a readily determinable fair value, the Company looks to observable transactions, such as the issuance of new equity by an investee, as indicators of investee enterprise value and uses them to estimate the fair value of the investments. The Company’s investments in limited partnerships are valued using NAV as a practical expedient and therefore excluded from the fair value hierarchy.

Funds held for customers

Funds held for customers consist of customer cash deposits held by Procore Payment Services, Inc. (“Procore Payment Services”), a subsidiary of the Company, in connection with its money transmission activities. Procore Payment Services provides money transmission services between general contractors and subcontractors by collecting funds from the general contractors for payments to be remitted to their subcontractors via the Company’s Procore Pay payment solution. These funds are deposited into the Company’s bank accounts, where the Company acts as the custodian of the funds while processing payments to subcontractors. Such funds are restricted for the purpose of satisfying general contractors’ fund obligations and are not available for general business use by the Company.

As of September 30, 2026 and December 31, 2025, the Company held $27.5 million and $9.0 million in customer funds, respectively, which are reported in prepaid expenses and other current assets, with a corresponding liability recorded in other current liabilities on the condensed consolidated balance sheets.

Cash, cash equivalents, and restricted cash

The Company classifies all investments that are readily convertible to known amounts of cash and have maturities of three months or less from the date of purchase as cash equivalents, which are carried at fair value. Cash includes cash held in checking and savings accounts. As of September 30, 2026 and December 31, 2025, cash equivalents were comprised of money market funds and highly liquid marketable securities with original maturities of three months or less that were recorded at fair value, which approximates amortized cost.

Restricted cash consists of (i) funds held for customers relating to Procore Payment Services and (ii) cash collateral required by a bank for the Company’s corporate credit card program. As of September 30, 2026, $27.5 million in restricted cash consisted of funds held for customers, and $0.6 million in restricted cash relating to corporate credit cards. As of December 31, 2025, $9.0 million in restricted cash consisted of funds held for customers, and $0.6 million in restricted cash relating to corporate credit cards. The Company records restricted cash in prepaid expenses and other current assets in the condensed consolidated balance sheets, depending on the term of restriction set in the underlying agreement.

Deferred revenue

Contract liabilities consist of revenue that is deferred when the Company has the contractual right to invoice in advance of transferring services to its customers. The Company recognized revenue of $332.9 million and $256.5 million during the three months ended September 30, 2026 and 2025, respectively, that was included in deferred revenue balances at the beginning of the respective periods. The Company recognized revenue of $619.6 million and $507.8 million during the nine months ended September 30, 2026 and 2025, respectively, that was included in deferred revenue balances at the beginning of the respective periods.

Remaining performance obligations

The transaction price allocated to remaining performance obligations (“RPO”) represents the contracted transaction price that has not yet been recognized as revenue, which includes deferred revenue and amounts under non-cancelable contracts that will be invoiced and recognized as revenue in future periods. The Company’s current RPO represents future revenue under existing contracts that is expected to be recognized as revenue in the next 12 months. As of September 30, 2026, the aggregate amount of the transaction price allocated to RPO was $1.8 billion, of which the Company expects to recognize $1.2 billion, or approximately 65%, as revenue in the next 12 months, and substantially all of the remaining $635.5 million between 12 and 36 months thereafter.

Recently adopted accounting pronouncements

Derivatives Scope Refinements

In September 2025, the FASB issued ASU No. 2025-07, Derivatives and Hedging (Topic 815) and Revenue from Contracts with Customers (Topic 606) (“ASU 2025-07”). The new amendment excludes non-exchange-traded contracts with underlyings that are based on operations or activities specific to one of the parties to the contract from derivative accounting. ASU 2025-07 is effective for public business entities for fiscal years beginning after December 15, 2026 and interim periods within those annual reporting periods, with early adoption permitted as of the beginning of an annual reporting period. Upon adoption, public entities should apply the amendment either (1) prospectively to new contracts entered into on or after the adoption date or (2) on a modified retrospective basis through a cumulative-effect adjustment to the opening balance of retained earnings as of the beginning of the annual reporting period of adoption for contracts existing as of the beginning of the annual reporting period of adoption. The Company adopted the guidance effective January 1, 2026, on a prospective basis. Adoption did not have a material impact on the Company’s condensed consolidated financial statements because the Company had no contracts within the scope of the new guidance as of the adoption date. The first, and only, contract subject to the amended guidance was the 2031 Notes entered into during the three months ended September 30, 2026.

Recently issued accounting pronouncements - not yet adopted

Disaggregation of Income Statement Expenses

In November 2024, the FASB issued ASU No. 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40) – Disaggregation of Income Statement Expenses (“ASU 2024-03”). The new amendment expands financial reporting by requiring that public entities disclose additional information about certain expense categories in tabular form in the notes to financial statements at interim and annual reporting periods. ASU 2024-03 is effective for public business entities for fiscal years beginning after December 15, 2026 and for interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. Upon adoption, public entities should apply the amendment either (1) prospectively to financial statements issued for reporting periods after the effective date or (2) retrospectively to all periods presented in the financial statements. The Company is evaluating the impact of the adoption of ASU 2024-03 on its condensed consolidated financial statements and disclosures.

Improvements to Accounting for Internal-Use Software

In September 2025, the FASB issued ASU No. 2025-06, Intangibles – Goodwill and Other – Internal-Use Software(“ASU 2025-06”). The new amendment modernizes the accounting for software costs by changing the timing of when an entity is required to start capitalizing software projects and requiring entities to evaluate the uncertainties associated with software development activities. ASU 2025-06 is effective for public business entities for fiscal years beginning after December 15, 2027, and interim periods within those annual reporting periods, with early adoption permitted as of the beginning of an annual reporting period. The Company is evaluating the impact the adoption of ASU 2025-06 will have on its condensed consolidated financial statements and disclosures.

3. INVESTMENTS

Marketable securities

Marketable securities consisted of the following as of September 30, 2026 (in thousands):

Marketable securities consisted of the following as of December 31, 2025 (in thousands):

The following table summarizes the estimated fair value of investments classified as marketable securities by contractual maturity date (in thousands):

During the nine months ended September 30, 2026 and 2025, there were maturities of marketable securities of $150.4 million and $287.0 million, respectively. There were $106.8 million and $2.7 million of sales of marketable securities during the nine months ended September 30, 2026 and 2025, respectively. Realized gains and losses on sales of marketable securities are recorded in other income (expense), net on the condensed consolidated statements of operations and comprehensive income (loss). There were no impairments of marketable securities during the nine months ended September 30, 2026 or 2025.

Strategic investments

Strategic investment activity during the nine months ended September 30, 2026 is summarized as follows (in thousands):

(1) Includes net contributions and distributions from limited partnership securities.

(2) Sale excludes a realized gain of $0.6 million, which was recorded in other income (expense), net on the condensed consolidated statements of operations and comprehensive income (loss).

During the nine months ended September 30, 2026, the Company identified an observable price change for one of its strategic investments, and as a result, recorded an unrealized gain of $6.1 million which is recorded in other income (expense), net on the condensed consolidated statements of operations and comprehensive income (loss).

Strategic investment activity during the nine months ended September 30, 2025 is summarized as follows (in thousands):

(1) Includes net contributions and distributions from limited partnership securities.

Strategic investments are recorded in other assets on the accompanying condensed consolidated balance sheets.

As of September 30, 2026, in connection with the Company’s investments in limited partnerships, it has a contractual obligation to provide additional investment funding of up to $8.0 million at the option of the investees.

4. FAIR VALUE OF FINANCIAL INSTRUMENTS

Financial assets measured at fair value on a recurring basis within the fair value hierarchy are summarized as follows (in thousands):

5. LEASES

The Company has primarily entered into lease arrangements for office space, in addition to other miscellaneous equipment. The Company’s leases have initial non-cancelable lease terms ranging fromone to 14 years. Some of the Company’s leases include an option for it to extend the term of the lease for up to 5 years.

During the nine months ended September 30, 2026, the Company executed a strategic plan for its office leases in Carpinteria, California, altering its long-term renewal expectations. While the Company previously assumed it was reasonably certain to exercisetwo 5-year renewal options across all suites, management elected to exercise onlyone 5-year renewal for its primary core lease space and decline future renewal extensions for the remaining office suites. These actions shortened the remaining lease terms and triggered a reclassification of the arrangements from finance leases to operating leases. Consequently, future contractual rent commitments decreased by a net of $29.7 million. Total finance lease modifications during the period resulted in net decreases to right of use assets–finance leases and corresponding finance lease liabilities of $18.8 million and $27.6 million, respectively, which primarily related to the modified leases in Carpinteria. Total operating lease modifications related to Carpinteria during the period resulted in net increases to right of use assets–operating leases and corresponding operating lease liabilities of $0.9 million and $3.9 million, respectively.

As a result of the Carpinteria lease modifications, the Company recognized a one-time non-cash gain of $5.8 million as an offset to rent expense during the nine months ended September 30, 2026. The non-cash gain will be partially offset by accelerated leasehold improvement amortization of $5.1 million through the end of the new lease term, of which $4.1 million and $1.0 million will be recognized in fiscal years 2026 and 2027, respectively. The non-cash gain and the accelerated leasehold improvement amortization are both recorded in general and administrative expenses in the condensed consolidated statements of operations and comprehensive income (loss).

Supplemental information related to leases is as follows (in thousands):

Maturities of lease payments, net of tenant improvement reimbursement, for leases where the lease commencement date commenced on or prior to September 30, 2026 are as follows (in thousands):

(1) For the three months from October 1, 2026 through December 31, 2026.

6. BUSINESS COMBINATIONS

DroneDeploy

On September 9, 2026, the Company completed the acquisition of DroneDeploy. The purchase price was $845.0 million in cash adjusted for closing cash, transaction expenses, hold back, and acceleration of vesting of certain DroneDeploy equity awards. The preliminary purchase consideration totaled $811.7 million.

On the acquisition date, $4.2 million in cash was placed in an escrow account held by a third-party escrow agent for potential breaches of representations, warranties, and covenants, and satisfaction of indemnity obligations and may be released from escrow to DroneDeploy’s stockholders 12 months after the acquisition date (subject to any amounts held back for indemnification claims). The escrow amount represents consideration transferred to the sellers and is included in the purchase price. $8.5 million was placed in an escrow account held by a third-party escrow agent to secure potential post-close purchase price adjustments (the “Adjustment Escrow”). The Adjustment Escrow represents a holdback of consideration otherwise payable to the former stockholders of DroneDeploy and is included in the purchase price. The amount is not contingent upon future events or continued employment and will be released or applied solely based on the resolution of post-closing purchase consideration adjustments.

The preliminary purchase consideration was allocated to the following assets and liabilities at the acquisition date (in thousands):

Developed technology intangible asset represents the fair value of DroneDeploy’s technology, which was valued using the multi-period excess earnings method under the income approach. The multi-period excess earnings method calculates the net present value of discounted cash flows using forecasted revenue, gross margin, and operating expenses. Developed technology is amortized on a straight-line basis, which approximates the pattern in which the economic benefits of the technology are consumed, over its estimated useful life ofeight years. The amortization expense is recorded in cost of revenue in the accompanying condensed consolidated statements of operations and comprehensive income (loss).

Customer relationships represent the fair value of the underlying relationships with DroneDeploy’s existing customers, which were valued using the with-and-without method under the income approach. The with-and-without method calculates the earnings attributable to specific customer contracts by comparing the expected cash flows of the ongoing business against cash flows generated during a hypothetical rebuild period required to replace the existing customer base. The customer relationship intangible asset is amortized on a straight-line basis, which approximates the pattern in which the economic benefits of the customer relationships are consumed, over its estimated useful life of 10 years. The amortization expense is recorded in sales and marketing expenses in the accompanying condensed consolidated statements of operations and comprehensive income (loss).

The $566.5 million goodwill balance is primarily attributable to synergies and expanded market opportunities that are expected to be achieved from the integration of DroneDeploy with the Company’s offerings and assembled workforce. Goodwill is not deductible for income tax purposes.

The measurement period for the valuation of assets acquired and liabilities assumed ends as soon as information on the facts and circumstances that existed as of the acquisition date becomes available, but does not exceed 12 months. The purchase price allocation is subject to future adjustments, including as a result of finalizing the closing net working capital.

The Company issued 812,524 service-based restricted stock units (“RSUs”), at a grant date fair value of $56.18 per share. The RSUs included 334,477 grants issued in order to retain certain employees of DroneDeploy and 478,047 grants issued to replace existing DroneDeploy employees’ unvested equity prior to the acquisition. The total grant date fair value of the RSUs was excluded from purchase consideration and is recognized as post-combination expense. See Note 11 to these condensed consolidated financial statements for details on how the Company expenses stock-based compensation.

To retain certain DroneDeploy employees, the Company also held back $32.1 million of the cash purchase price, which will be released infour equal installments everysix months after the acquisition date based on continued employment over atwo-year period. The cash holdback amount is excluded from the purchase consideration and will be recorded as post-combination compensation expense over the service period on a straight-line basis.

Of the cash consideration, $14.8 million relates to the acceleration of vesting of certain DroneDeploy equity awards. The payment was excluded from purchase consideration and recorded to compensation expense in the accompanying condensed consolidated statements of operations and comprehensive income (loss) on the acquisition date. Other acquisition-related transaction costs incurred by the Company of $8.5 million were expensed as incurred in the condensed consolidated statements of operations and comprehensive income (loss). Accelerated vesting and other transaction costs are included in operating activities in the condensed consolidated statements of cash flows.

The following unaudited pro forma financial information combines the results of operations for Procore and DroneDeploy as if the closing of the acquisition had occurred on January 1, 2025, and adjusts for amortization of acquired intangible assets, transaction costs associated with the acquisition, compensation expense as if the retention payments discussed above had vested, stock-based compensation expense for RSUs granted to continuing employees, compensation expenses related to the accelerated vesting discussed above, and tax benefits recorded as a result of the acquisition. The unaudited pro forma results do not reflect any cost saving synergies from operating efficiencies or the effect of the incremental costs of integrating these companies. Accordingly, these unaudited pro forma results are presented for informational purposes only and are not necessarily indicative of what the actual results of operations of the combined company would have been if the acquisition had occurred as of January 1, 2025, nor are they indicative of future results of operations (in thousands):

Since the acquisition date, DroneDeploy contributed $5.4 million in revenue and incurred $4.8 million in net loss which are included in the Company's condensed consolidated statements of operations and comprehensive loss for the three and nine months ended September 30, 2026.

Datagrid

On January 16, 2026, the Company completed the acquisition of all outstanding equity of Toric Labs, Inc. (d/b/a Datagrid) (“Datagrid”), a leader in agentic artificial intelligence (“AI”) solutions for the construction industry, to accelerate the Company’s AI strategy and deliver advanced reasoning and data connectivity capabilities for its customers. The purchase consideration was $168.0 million in total cash consideration.

The preliminary purchase consideration was allocated to the following assets and liabilities at the acquisition date (in thousands):

Developed technology intangible asset represents the fair value of Datagrid’s technology, which was valued considering the cost to rebuild method. Key assumptions under the cost to rebuild method include the estimated level of effort and related costs of reproducing or replacing the acquired technology. Developed technology is amortized on a straight-line basis, which approximates the pattern in which the economic benefits of the technology are consumed, over its estimated useful life ofseven years. The amortization expense is recorded in cost of revenue in the accompanying condensed consolidated statements of operations and comprehensive income (loss).

Customer relationships represent the fair value of the underlying relationships with Datagrid’s existing customers, which were valued using the excess earnings method. Key assumptions under the excess earnings method include estimated future revenues, costs, cash flows, and a discount rate. The customer relationship intangible asset is amortized on a straight-line basis, which approximates the pattern in which the economic benefits of the customer relationships are consumed, over its estimated useful life of 10 years. The amortization expense is recorded in sales and marketing expenses in the accompanying condensed consolidated statements of operations and comprehensive income (loss).

The $114.9 million goodwill balance is primarily attributable to synergies and expanded market opportunities that are expected to be achieved from the integration of Datagrid with the Company’s offerings and assembled workforce. Goodwill is not deductible for income tax purposes.

The measurement period for the valuation of assets acquired and liabilities assumed ends as soon as information on the facts and circumstances that existed as of the acquisition date becomes available, but does not exceed 12 months. The purchase price allocation is subject to future adjustments, including as a result of finalizing the closing net working capital.

The Company issued 59,492 performance based restricted stock units (“PSUs”) and 344,729 service-based RSUs, at a grant date fair value of $70.90 per share, in order to retain certain employees of Datagrid. The PSUs issued to Datagrid employees vest upon the achievement of certain milestones. The total grant date fair value of the PSUs and RSUs was excluded from purchase consideration and is recognized as post-combination expense. See Note 11 to these condensed consolidated financial statements for details on how the Company expenses stock-based compensation.

To retain certain Datagrid employees, the Company also held back $25.7 million of the cash purchase price, which will be released in equal installments everysix months after the acquisition date based on continued employment over atwo- orthree-year period, as applicable. The cash holdback amount is excluded from the purchase consideration and will be recorded as post-combination compensation expense over the service period on a straight-line basis.

The Company has not separately presented pro forma results reflecting the acquisition of Datagrid or revenue and operating losses of Datagrid for the period from the acquisition date through September 30, 2026, as the impacts were not material to the condensed consolidated financial statements. The acquisition-related transaction costs incurred by the Company of $2.1 million were expensed as incurred in the condensed consolidated statements of operations and comprehensive income (loss).

Novorender

On January 28, 2025, the Company completed the acquisition of all outstanding equity of Novorender AS (“Novorender”), a Norway-based leader in advanced building information modeling rendering technology, to enhance Procore’s capabilities for large-scale construction projects. The purchase price was $44.3 million in total cash consideration. Of the consideration transferred, $43.2 million was considered purchase consideration. $1.1 million of the cash consideration relates to the acceleration of options vesting for certain Novorender option holders, and was excluded from purchase consideration and recorded to compensation expense in the accompanying condensed consolidated statements of operations and comprehensive income (loss) on the acquisition date. On the acquisition date, $5.0 million in cash was placed in an escrow account held by a third-party escrow agent for potential breaches of representations, warranties, and covenants, and satisfaction of indemnity obligations and is scheduled to be released from escrow to Novorender’s stockholders 24 months after the acquisition date (subject to any indemnification claims).

The purchase consideration was allocated to the following assets and liabilities at the acquisition date (in thousands):

During the nine months ended September 30, 2025, the Company recorded a measurement period adjustment which did not have a material impact on goodwill. The purchase price accounting for this acquisition is final.

Developed technology intangible asset represents the fair value of Novorender’s technology, which was valued considering both the cost to rebuild and relief from royalty methods. Key assumptions under the cost to rebuild method include the estimated level of effort and related costs of reproducing or replacing the acquired technology. Key assumptions under the relief from royalty method include forecasted revenue to be generated from the developed technology, an estimated royalty rate applicable to the technology, and a discount rate. Developed technology is amortized on a straight-line basis, which approximates the pattern in which the economic benefits of the technology are consumed, over its estimated useful life ofseven years. The amortization expense is recorded in cost of revenue in the accompanying condensed consolidated statements of operations and comprehensive income (loss).

Customer relationships represent the fair value of the underlying relationships with Novorender’s existing customers, which were valued using the excess earnings method. Key assumptions under the excess earnings method include estimated future revenues, costs, cash flows, and a discount rate. The customer relationship intangible asset is amortized on a straight-line basis, which approximates the pattern in which the economic benefits of the customer relationships are consumed, over its estimated useful life of 10 years. The amortization expense is recorded in sales and marketing expenses in the accompanying condensed consolidated statements of operations and comprehensive income (loss).

The $23.7 million goodwill balance is primarily attributable to synergies and expanded market opportunities that are expected to be achieved from the integration of Novorender with the Company’s offerings and assembled workforce. Goodwill is not deductible for income tax purposes.

The Company issued 55,956 service-based RSUs at a grant date fair value of $76.30 per share in order to retain certain employees of Novorender. The total grant date fair value of the RSUs was excluded from purchase consideration and is recognized as post-combination expense. See Note 11 to these condensed consolidated financial statements for details on how the Company expenses stock-based compensation.

To retain certain Novorender employees, the Company held back $6.7 million of the cash purchase price, which will vest based on continued employment over atwo-year period. $1.9 million was paid in January 2026, and the remaining $4.8 million will be paid in January 2027. The cash holdback amount is excluded from the purchase consideration and will be recorded as post-combination compensation expense over the service period on a straight-line basis.

The Company has not separately presented pro forma results reflecting the acquisition of Novorender or revenue and operating losses of Novorender for the period from the acquisition date through September 30, 2026, as the impacts were not material to the condensed consolidated financial statements. The acquisition-related transaction costs were not material and were expensed as incurred in the accompanying condensed consolidated statements of operations and comprehensive income (loss).

7. INTANGIBLE ASSETS AND GOODWILL

Intangible assets

During the nine months ended September 30, 2026, the Company completed the acquisitions of DroneDeploy and Datagrid, which were accounted for as business combinations, as described above in Note 6.

The Company’s intangible assets are summarized as follows (in thousands):

Certain of the Company’s intangible assets related to the prior acquisitions were fully amortized as of December 31, 2025. The Company estimates that there isno significant residual value related to its intangible assets. Amortization expense related to the Company’s intangible assets is summarized as follows (in thousands):

Goodwill

The following table presents the changes in carrying amount of goodwill during the nine months ended September 30, 2026 (in thousands):

(1) Includes acquisition-related post-closing net working capital adjustments and the effect of foreign currency translation.

The addition to goodwill was due to the acquisitions of DroneDeploy and Datagrid, as disclosed in Note 6 to these condensed consolidated financial statements. There wasno impairment of goodwill during the periods presented.

8. ACCRUED EXPENSES

The following represents the components of accrued expenses contained within the Company’s condensed consolidated balance sheets at the end of each period (in thousands):

9. DEBT

Convertible notes

The 2031 Notes were issued pursuant to an indenture (the “Indenture”) dated August 6, 2026, between the Company and U.S. Bank Trust Company, National Association, as trustee. The 2031 Notes are general senior unsecured obligations of the Company and will mature on August 15, 2031, unless earlier converted, redeemed, or repurchased. The 2031 Notes do not bear regular interest, and the principal amount of the 2031 Notes will not accrete. Special interest will accrue on the 2031 Notes in the circumstances and at the rates provided in the Indenture.

The 2031 Notes will be convertible at the option of the holders in certain circumstances. Upon conversion, the Company will pay cash up to the aggregate principal amount of the 2031 Notes converted, and it will pay or deliver, as the case may be, cash, shares of common stock, or a combination thereof, at the Company’s election, for any conversion value in excess of such principal.

The initial conversion rate is 12.0642 shares of the Company’s common stock per $1,000 principal amount of the 2031 Notes, which is equivalent to an initial conversion price of approximately $82.89 per share. Up to 11,460,990 shares of common stock are initially issuable upon conversion depending on the settlement method elected by the Company and the conversion value at the time of conversion.

Holders may convert all or any portion of their 2031 Notes at their option at any time prior to the close of business on the business day immediately preceding May 15, 2031, only under the following circumstances:

•during any calendar quarter commencing after the calendar quarter ending on September 30, 2026 (and only during such calendar quarter), if the last reported sale price of the Company’s common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 150% of the conversion price for the 2031 Notes on each applicable trading day;

•during thefive business day period after any 10 consecutive trading day period (the “measurement period”) in which the trading price per $1,000 principal amount of the 2031 Notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of the Company’s common stock and the conversion rate on each such trading day;

•if the Company calls the 2031 Notes for redemption, at any time prior to the close of business on the second scheduled trading day immediately preceding the redemption date, but only with respect to the 2031 Notes that are called (or deemed called, in the case of an optional redemption) for redemption; or

•upon the occurrence of specified corporate events as set forth in the Indenture.

On or after May 15, 2031, until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert all or any portion of their 2031 Notes at any time, regardless of the above conditions.

The Company may not redeem the 2031 Notes prior to August 20, 2029, except in the event of a cleanup redemption described below. The Company may redeem for cash all or any portion of the 2031 Notes (subject to certain limitations), at its option, on a redemption date on or after August 20, 2029 and before the 31st scheduled trading day immediately prior to the maturity date if the last reported sale price of the Company’s common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which the Company provides the related notice of redemption at a redemption price equal to 100% of the principal amount of the 2031 Notes to be redeemed, plus accrued and unpaid special interest, if any, to, but excluding, the redemption date. In addition, subject to certain conditions, the Company may redeem for cash all, but not less than all, of the 2031 Notes at any time if the aggregate principal amount of the 2031 Notes that remains outstanding at such time is less than $100.0 million at a redemption price equal to 100% of the principal amount of the 2031 Notes to be redeemed, plus accrued and unpaid special interest, if any, to, but excluding, the redemption date.

The conversion rate is subject to adjustment in some events in accordance with the terms of the Indenture but will not be adjusted for any accrued and unpaid special interest. In addition, following certain corporate events that occur prior to the maturity date of the 2031 Notes or if the Company delivers a notice of redemption, the Company will, in certain circumstances, increase the conversion rate of the 2031 Notes for a holder who elects to convert its 2031 Notes in connection with such a corporate event or convert its 2031 Notes called (or deemed called, in the case of an optional redemption) for redemption during the related redemption period (as set forth in the Indenture), as the case may be.

The following table represents the net carrying value of the 2031 Notes as of September 30, 2026 (in thousands):

Debt issuance costs are amortized over the term of the 2031 Notes at an effective interest rate of 0.5% for the three and nine months ended September 30, 2026.

Capped calls

On August 4, 2026, in connection with the offering of the 2031 Notes, the Company entered into privately negotiated capped call transactions (the “Capped Calls”) with certain financial institutions at an initial strike price of $82.89 per share, which corresponds to the initial conversion price of the 2031 Notes, for a total cost of $59.1 million. The Capped Calls cover, subject to customary adjustments substantially similar to those applicable to the 2031 Notes, approximately 11,460,990 shares of the Company’s common stock, and expire on August 15, 2031, the maturity date of the 2031 Notes, subject to earlier termination under certain circumstances.

The Capped Calls are expected to offset potential dilution to the Company’s common stock upon any conversion of the 2031 Notes and/or offset any cash payments the Company is required to make in excess of the principal amount of converted 2031 Notes, as the case may be, with such reduction subject to a cap based on a cap price initially equal to $110.52 per share (which represents a premium of 100% over the last reported sale price of the Company’s common stock of $55.26 on the New York Stock Exchange on August 3, 2026), and is subject to certain adjustments under the terms of the Capped Calls. The Capped Calls are excluded from the calculation of diluted net income (loss) per share as their effect would be anti-dilutive.

The Capped Calls are freestanding financial instruments, meet the conditions for equity classification, and were recorded as a reduction to additional paid-in capital in the accompanying condensed consolidated balance sheets. The Capped Calls are not remeasured in subsequent periods. Transaction costs directly attributable to the Capped Calls are also recorded as a reduction to additional paid-in capital.

Bridge facility

On July 27, 2026, in connection with entering into the Agreement and Plan of Merger to acquire DroneDeploy, the Company entered into a commitment letter (the “Commitment Letter”) with Goldman Sachs Bank USA (the “Commitment Bank”), pursuant to which the Commitment Bank committed to provide the Company with debt financing in an aggregate principal amount of up to $700.0 million in the form of a 364-day senior secured bridge facility (the “Bridge Facility”), subject to customary conditions. No amounts were borrowed under the Bridge Facility. The Bridge Facility was intended to be used to fund a portion of the consideration for the DroneDeploy acquisition and related transaction expenses to the extent that the Company had not obtained permanent financing on or prior to the closing date of the acquisition. Commitments under the Bridge Facility automatically terminated upon the consummation of the DroneDeploy acquisition without the funding of the Bridge Facility. In connection with the Commitment Letter, the Company incurred $4.3 million of financing costs during the three months ended September 30, 2026, which were expensed as incurred and are included in interest expense in the accompanying condensed consolidated statements of operations.

10. COMMITMENTS AND CONTINGENCIES

Legal matters

The Company is, and may in the future become, involved in or subject to various legal proceedings arising in the ordinary course of business, including, among other things, related to commercial matters, business or employment practices, regulatory compliance, and legal proceedings with third parties asserting infringement of their intellectual property rights. The results of any current or future legal proceedings cannot be predicted with certainty, and regardless of the outcome, such proceedings can have an adverse impact on the Company because of defense and settlement costs, diversion of management resources, and other factors. The Company reviews at least quarterly the status of each legal proceeding and assesses its potential financial exposure in light of the impacts of negotiations, estimated settlements, legal rulings, advice of legal counsel, and other information and events pertaining to such matters. The Company accrues a liability related to a legal proceeding when it is considered both probable that a liability has been incurred and the amount of the loss is reasonably estimable. However, legal proceedings are inherently uncertain and as circumstances change, it is possible that the amount of any accrued liability may increase, decrease, or be eliminated.

Trade Secret Litigation

On October 25, 2024, Oracle America, Inc., Oracle International Corporation, and Textura Corporation (collectively, “Oracle”) filed a lawsuit against the Company, its subsidiary Procore Payment Services, Inc., and a former employee of Oracle employed by the Company, in the U.S. District Court for the Northern District of California, captioned Oracle America, Inc. et al. v. Procore Technologies, Inc. et al., No. 4:24-cv-07457-JST (N.D. Cal.). The lawsuit alleges misappropriation of trade secrets in violation of the Defend Trade Secrets Act, asserting that the Company used Oracle’s trade secrets to develop and enhance the Company’s construction payment product, Procore Pay, and related enterprise resource planning integrations. On August 21, 2026, the court granted in part and denied in part the Company’s motion for summary judgment. Until recently, the pretrial conference was scheduled to take place on November 6, 2026, and trial was scheduled to begin on November 30, 2026. On October 27, 2026, the court vacated the dates of the pretrial conference and trial. The parties are working to reschedule such dates for 2027.

Oracle is seeking injunctive relief and monetary damages, including exemplary damages for alleged willful and malicious misappropriation, attorneys’ fees, and costs. As of the date of the filing of this report, the Company’s chances of success on the merits are still uncertain, and any possible loss or range of loss cannot be reasonably estimated at this time. The Company intends to continue to vigorously defend itself against the claim in this action.

Indemnification

In the ordinary course of business, the Company may provide indemnification of varying scope and terms to customers, vendors, investors, directors, and officers with respect to certain matters, including, but not limited to, losses arising out of its breach of such agreements, breaches of confidentiality or data protection requirements, services to be provided by the Company, or from intellectual property infringement claims made by third parties. These indemnification provisions may survive termination of the underlying agreement and the maximum potential amount of future payments the Company could be required to make under these indemnification provisions may not be subject to maximum loss clauses or be covered by the Company’s insurance programs. The maximum potential amount of future payments the Company could be required to make under these indemnification provisions is indeterminable.

The Company has never paid a material claim, nor has the Company been sued in connection with these indemnification arrangements. To date, the Company has not accrued a liability for these guarantees because the likelihood of incurring a payment obligation, if any, in connection with these guarantees is not probable or reasonably estimable.

11. STOCKHOLDERS’ EQUITY

2021 Equity Incentive Plan

In May 2021, the Company’s board of directors (the “Board”) adopted, and the stockholders approved, the 2021 Equity Incentive Plan (the “2021 Plan”) with the purpose of granting stock-based awards, including stock options, stock appreciation rights, restricted stock awards, RSUs, PSUs, and other forms of awards, to employees, directors, and consultants. As of December 31, 2025, a total of 59,355,916 shares of common stock were authorized for issuance under the 2021 Plan. The number of shares of the Company’s common stock reserved for issuance under the 2021 Plan automatically increases on January 1 of each calendar year, starting on January 1, 2022 through January 1, 2031, in an amount equal to either (i)5% of the total number of shares of the Company’s common stock outstanding on December 31 of the fiscal year before the date of each automatic increase, or (ii) a lesser number of shares determined by the Board prior to the applicable January 1. Accordingly, on January 1, 2026, the number of shares of common stock that may be issued under the 2021 Plan increased by an additional 7,585,428 shares. As a result, as of September 30, 2026, a total of 66,941,344 shares of common stock are authorized for issuance under the 2021 Plan. As of September 30, 2026, a total of 42,303,651 shares of common stock were available for issuance under the 2021 Plan. No stock options have been issued under the 2021 Plan.

Stock options

No stock options were granted during the periods presented.

The following table summarizes the stock option activity during the nine months ended September 30, 2026:

As of September 30, 2026, there isno unrecognized stock-based compensation cost for stock options previously granted by the Company.

Restricted stock units

Service-based restricted stock units

In 2018, the Company began issuing RSUs to certain employees, officers, non-employee consultants, and directors. All of the RSUs granted subsequent to the Company’s initial public offering (“IPO”) vest based solely on continued service, which is generally over three orfour years, on either a quarterly or annual vesting schedule.

The following table summarizes the RSU activity during the nine months ended September 30, 2026:

As of September 30, 2026, the total unrecognized stock‑based compensation cost for all RSUs outstanding was $438.4 million, which is expected to be recognized over a weighted‑average vesting period of 2.5 years.

Performance-based restricted stock units

Operating and financial performance-based restricted stock units

In 2022, the Company began granting PSUs to certain non-executive employees with vesting terms based on the achievement of certain operating and financial performance goals. In 2024, the Company began granting PSUs to certain executive employees with vesting terms based on the achievement of certain operating performance goals. Such PSUs are also subject to employees’ continued service through the applicable vesting dates. The grant date fair value per share for PSUs is equal to the closing stock price of the Company’s common stock on the market date prior to the grant date.

The grant date fair value for PSUs is recognized as compensation expense using a graded vesting attribution model. No expense is recognized for PSUs until that condition is probable of being met, therefore the portion of expense recognized in any period may fluctuate depending on changing estimates of the achievement of the performance conditions. Forfeitures are recorded when they occur.

Market based restricted stock units

In 2025, the Company began granting market-based PSUs (“MSUs”), with vesting terms that are subject to a market condition and will vest based on the Company’s total shareholder return (“TSR”) performance relative to the TSR of the other companies that comprise the S&P Completion Index (CI) Information Technology. Such MSUs are also subject to employees’ continued service through the applicable vesting dates. To determine the fair value of MSUs on the date of grant, the Company utilizes a Monte Carlo simulation with the following assumptions:

The Company estimates volatility for MSUs based on the historical volatility of its own common stock price. The interest rate is derived from government bonds with a term equal to the longest simulation term. The Company has not declared, nor does it expect to declare, dividends in the foreseeable future. Consequently, an expected dividend yield ofzero is utilized.

The grant date fair value for MSUs is recognized as compensation expense using a graded vesting attribution model. The expense recognized for MSUs is not adjusted for final projected payout of the awards. Forfeitures are recorded when they occur.

The following table summarizes the PSU and MSU activity during the nine months ended September 30, 2026:

(1) This represents awards granted at 100% attainment of the performance conditions.

As of September 30, 2026, the total unrecognized stock‑based compensation cost for all PSUs and MSUs outstanding was $80.9 million, which is expected to be recognized over a weighted‑average vesting period of 3.5 years.

Employee Stock Purchase Plan

In May 2021, the Board adopted, and the stockholders approved, the 2021 Employee Stock Purchase Plan (the “ESPP”), which became effective immediately prior to the effective date of the Company’s IPO. As of December 31, 2025, a total of 8,278,659 shares of common stock had been reserved for issuance under the ESPP. The number of shares of the Company’s common stock reserved for issuance under the ESPP automatically increases on January 1 of each year for a period of 10 years, beginning on January 1, 2022 and continuing through January 1, 2031, by the lesser of (i)1% of the total number of shares of the Company’s common stock outstanding on December 31 of the immediately preceding year; and (ii)3,900,000 shares, except before the date of any such increase, the Board may determine that such increase will be less than the amount set forth in clauses (i) and (ii). Accordingly, on January 1, 2026, the number of shares of common stock reserved under the ESPP increased by an additional 1,517,085 shares.

The offering periods are scheduled to start in May and November of each year. The ESPP provides for consecutive offering periods that will typically have a duration of 12 months in length and comprisetwo purchase periods ofsix months in length, subject to reset and rollover provisions.

The ESPP provides eligible employees with an opportunity to purchase shares of the Company’s common stock through payroll deductions of up to 15% of their eligible compensation, subject to a maximum of $25,000 of stock per calendar year. A participant may purchase a maximum of 2,500 shares of common stock during a purchase period. Amounts deducted and accumulated by the participant are used to purchase shares of common stock at the end of eachsix-month purchase period. The purchase price of the shares will be 85% of the lower of the fair market value of the common stock on (i) the first trading day of the applicable offering period and (ii) the last trading day of each purchase period in the related offering period. However, in the event the fair value of the common stock on the purchase date is lower than the fair value on the first trading day of the offering period, the offering period is terminated immediately following the purchase and a new offering period begins the following day. Participants may end their participation at any time prior to the last 15 days of a purchase period and will be repaid their accrued contributions that have not yet been used to purchase shares of common stock. Participation ends automatically upon termination of employment.

The fair value of the ESPP purchase rights on the date of grant using the Black-Scholes option pricing model was estimated using the following assumptions during the nine months ended September 30, 2026:

The term of the ESPP purchase rights is the offering period. The Company estimates volatility for ESPP purchase rights based on the historical volatility of its own common stock price. The interest rate is derived from government bonds with a similar term to the ESPP purchase right granted. The Company has not declared, nor does it expect to declare, dividends in the foreseeable future. Consequently, an expected dividend yield ofzero was utilized. The fair value of the Company’s common stock used to value ESPP purchase rights is based on the trading price of its publicly traded common stock.

Employee payroll contributions accrued in connection with the ESPP were $8.1 million and $5.2 million as of September 30, 2026 and December 31, 2025, respectively, and are included within accrued expenses on the accompanying condensed consolidated balance sheets. Employee payroll contributions ultimately used to purchase shares will be reclassified to stockholders’ equity on the purchase date. Stock-based compensation expense related to the ESPP is recognized on a straight-line basis over the offering period. During the nine months ended September 30, 2026 and 2025, the Company recognized stock-based compensation expense of $8.2 million and $6.6 million, respectively, in connection with the ESPP. During the nine months ended September 30, 2026 and 2025,330,571 and 245,276 shares of the Company’s common stock were purchased under the ESPP, respectively.

As of September 30, 2026, unrecognized stock-based compensation expense related to the ESPP was $5.0 million, which is expected to be recognized over a weighted-average period of 0.4 years.

Stock-based compensation

The Company recorded total stock-based compensation cost from stock options, RSUs, PSUs, MSUs, and the ESPP as follows (in thousands):

Stock repurchase program

On November 3, 2025, the Board authorized a stock repurchase program to repurchase up to $300.0 million of the Company’s outstanding common stock (the “2025 Stock Repurchase Program”). Repurchases were effected from time to time through the open market or other transactions, in accordance with applicable law. The 2025 Stock Repurchase Program expired on November 3, 2026.

On October 30, 2026, the Board authorized a new stock repurchase program. See Note 16 to these condensed consolidated financial statements for details about the new stock repurchase program.

During the nine months ended September 30, 2026, the Company repurchased and retired a total of 4,932,407 shares of the Company’s common stock at a weighted average per share price of $55.77 for an aggregate amount of $275.1 million, which includes the transaction costs associated with the repurchases but excludes the 1% excise tax on stock repurchases imposed by the Inflation Reduction Act of 2022.

Of the 4,932,407 shares the Company repurchased during the nine months ended September 30, 2026,3,166,847 shares were repurchased in privately negotiated transactions effected with or through one or more purchasers of the 2031 Notes or their respective affiliates. Such repurchases were authorized separately from, and were not a part of, the Company’s authorized stock repurchase program.

12. INCOME TAXES

For the three months ended September 30, 2026 and 2025, the Company recorded income tax expenses of $0.9 million and $0.5 million, respectively. For the nine months ended September 30, 2026 and 2025, the Company recorded an income tax benefit of $2.7 million and an income tax expense of $5.4 million, respectively. As of September 30, 2026, the Company maintained a full valuation allowance on its U.S. federal and state net deferred tax assets as it was more likely than not that those deferred tax assets would not be realized.

In determining quarterly provisions for income taxes, the Company uses the annual estimated effective tax rate applied to the actual year-to-date income or loss, adjusted for discrete items, if any, arising in that quarter. The Company’s annual estimated effective tax rate differs from the U.S. federal statutory rate of 21% primarily as a result of state taxes, foreign taxes, and changes in the Company’s valuation allowance.

13. NET INCOME (LOSS) PER SHARE

Basic net income (loss) per share attributable to common stockholders is calculated by dividing the net income (loss) attributable to common stockholders by the weighted-average number of shares of common stock outstanding during the period. Diluted net income (loss) per share is calculated by giving effect to all potential dilutive common stock equivalents during the period. For purposes of this calculation, options to purchase common stock, RSUs, PSUs, MSUs, and shares issuable under the ESPP are considered to be potential common stock equivalents.

A reconciliation of the denominator used in the calculation of basic and diluted net income (loss) per share is as follows:

For the nine months ended September 30, 2026, potentially dilutive shares are included in the calculation of diluted net income per share using the treasury stock method. Capped calls are excluded from the calculation of diluted earnings per share as they would be anti-dilutive.

Since the Company reported net losses for the three and nine months ended September 30, 2025, diluted net loss per share is the same as basic net loss per share. All of the Company’s outstanding stock options, RSUs, PSUs, MSUs, and shares issuable under the ESPP were excluded in the calculation of diluted net loss per share as the effect would be anti-dilutive.

The following weighted-average potentially dilutive shares are excluded from the calculation of diluted earnings per share as they are anti-dilutive:

14. GEOGRAPHIC INFORMATION

The following table sets forth the Company’s revenues by geographic region, which is determined based on the billing location of the customer (in thousands):

15. RESTRUCTURING

In January 2026, the Company executed a reduction of 4% of its global workforce as part of its ongoing evaluation of its operations to ensure alignment of its workforce with, and to enable greater investment in key growth opportunities. The reduction in force was completed as of March 31, 2026.

The following table summarizes the severance and other benefit costs incurred during the nine months ended September 30, 2026 by line item within the condensed consolidated statement of operations and comprehensive income (loss) (in thousands) related to this restructuring event:

As of September 30, 2026, there wasno liability remaining for restructuring-related costs.

16. SUBSEQUENT EVENTS

On October 30, 2026, the Board authorized a new stock repurchase program to repurchase up to $300.0 million of the Company’s outstanding common stock. The Company intends to opportunistically repurchase shares of its common stock from time to time through the open market, or other transactions in accordance with applicable law, in each case, subject to market conditions, applicable legal requirements, and other relevant factors. Open market repurchases may be structured to occur in accordance with the requirements of Rule 10b-18 of the Securities Exchange Act of 1934, as amended. The Company may also, from time to time, enter into Rule 10b5-1 trading plans to facilitate repurchases of its common stock under this authorization. The timing of stock repurchases and the actual number of shares repurchased will depend on a variety of factors, including price, general business and market conditions, and alternative investment opportunities, and will be subject to the discretion of the Company’s management within its authorization. The stock repurchase program will be funded using the Company’s working capital. The stock repurchase program does not obligate the Company to acquire any particular number of shares of the Company’s common stock, or any shares at all. The new stock repurchase program expires on October 30, 2027, and may be suspended or discontinued at any time at the Company’s discretion and without notice.