CS Disco, Inc.
For the period ended Jun 30, 2026. Filed Aug 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.
Jun 30, 2026 · Filed Aug 5, 2026
LAW$5.66+0.7%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-03-31; filed 2026-05-06.
0001625641-26-000108
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-06-30; filed 2026-08-05.
0001625641-26-000162
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 88 previous paragraphs and 98 current paragraphs.
69 unchanged; 18 reworded; 7 added; 1 removed; 0 previous and 4 current paragraphs rearranged.
Tables are not compared: 10 previous and 15 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 (7)
Current report
Research and development expenses increased by $1.0 million, or 7%, for the three months ended June 30, 2026 compared to the same period in 2025. The change was primarily driven by an increase of $0.7 million in software costs predominantly related to additional AI-powered productivity and development tools as well as a $0.3 million increase in personnel costs.
Current report
General and administrative expenses decreased by $1.5 million, or 14%, for the three months ended June 30, 2026 compared to the same period in 2025. This change was primarily attributable to a decrease of $1.6 million in legal costs related to the securities litigation and a decrease of $0.4 million in bad debt expense. These changes were partially offset by an increase in professional services costs of $0.8 million.
Current report
Comparison of the Six Months Ended June 30, 2026 and 2025
Current report
Revenue
Current report
Research and development expenses increased by $1.4 million, or 5%, for the six months ended June 30, 2026 compared to the same period in 2025. The change was primarily driven by an increase of $0.9 million in software costs predominantly related to AI-powered productivity and development tools as well as an increase of $0.8 million in personnel costs. These changes were partially offset by a $0.3 million increase in capitalized software development.
Current report
Sales and marketing expenses increased by $3.2 million, or 11%, for the six months ended June 30, 2026 compared to the same period in 2025. The change was driven by an increase of $2.5 million in personnel costs, including commissions expense for our sales personnel, an increase of $0.3 million in marketing expense, and an increase of $0.2 million in professional services cost.
Current report
$0.5 million and $0.2 million, respectively. These changes were partially offset by an increase in professional services costs of $1.6 million.
Removed paragraphs (1)
Previous report
Research and development expenses increased by $0.4 million, or 3%, for the three months ended March 31, 2026 compared to the same period in 2025. The change was primarily driven by an increase of $0.5 million in personnel costs due to increased headcount, partially offset by a $0.2 million increase in capitalized software development.
Reworded paragraphs (18)
Previous wording
We generate substantially all of our revenue from our customers’ actual usage of ourproduct offerings. Customers generally do not commit to purchase a specific amount of usage on ourproduct offerings and their usage can fluctuate based on the number and nature of legal matters they have at any particular time. As a result, our revenue and other financial results can fluctuate from period to period given the inherent unpredictability of the timing, duration and scope of legal casework. We also offer our customers the option to enter into subscriptions based on committed minimum usage on an annual or multi-year basis, which represented 9% and 10% of our revenue for the three months ended March 31, 2026 and 2025, respectively. In addition, we generate revenue from a range of professional services aimed at accelerating the time-to-value for our customers.
Current wording
We generate substantially all of our revenue from our customers’ actual usage of ourproduct offerings. Customers generally do not commit to purchase a specific amount of usage on ourproduct offerings and their usage can fluctuate based on the number and nature of legal matters they have at any particular time. As a result, our revenue and other financial results can fluctuate from period to period given the inherent unpredictability of the timing, duration and scope of legal casework. We also offer our customers the option to enter into subscriptions based on committed minimum usage on an annual or multi-year basis, which represented 8% of our revenue for each of the three and six months ended June 30, 2026, and 10% and 11% for the three and six months ended June 30, 2025, respectively. In addition, we generate revenue from a range of professional services aimed at accelerating the time-to-value for our customers.
Previous wording
As of March 31, 2026, we had $17.6 million of cash and cash equivalents and $85.4 million of short-term investments. We generated revenue of $41.9 million and $36.7 million in the three months ended March 31, 2026 and 2025, respectively, representing a period-over-period growth of 14%. Our net loss was $9.6 million and $11.4 million for the three months ended March 31, 2026 and 2025, respectively.
Current wording
As of June 30, 2026, we had $10.9 million of cash and cash equivalents and $90.5 million of short-term investments. We generated revenue of $43.1 million and $38.1 million in the three months ended June 30, 2026 and 2025, respectively, representing period-over-period growth of 13%. We generated revenue of $85.0 million and $74.8 million in the six months ended June 30, 2026 and 2025, respectively, representing period-over-period growth of 14%. Our net loss was $8.7 million and $10.8 million for the three months ended June 30, 2026 and 2025, respectively, and $18.3 million and $22.2 million for the six months ended June 30, 2026 and 2025, respectively.
Previous wording
We generated Adjusted EBITDA of $(3.5) million and $(5.1) million in the three months ended March 31, 2026 and 2025, respectively. See the section titled “—Non-GAAP Financial Measure” for the definition of Adjusted EBITDA, as well as a reconciliation of Adjusted EBITDA to net loss, the most directly comparable financial measure stated in accordance with GAAP.
Current wording
We generated Adjusted EBITDA of $(3.4) million and $(2.7) million in the three months ended June 30, 2026 and 2025, respectively, and $(6.9) million and $(7.8) million in the six months ended June 30, 2026 and 2025, respectively. See the section titled “—Non-GAAP Financial Measure” for the definition of Adjusted EBITDA, as well as a reconciliation of Adjusted EBITDA to net loss, the most directly comparable financial measure stated in accordance with GAAP.
Previous wording
Our market is global and we believe there is a significant opportunity to expand our international customer base, particularly in the United Kingdom, and further expand our operations internationally, particularly in India. In the three months ended March 31, 2026, 11% of our revenue was generated by customers outside of the United States. Operationally, we expect to continue to expand our global employee headcount in India.
Current wording
Our market is global and we believe there is a significant opportunity to expand our international customer base, particularly in the United Kingdom, and further expand our operations internationally, particularly in India. In the three and six months ended June 30, 2026, 12% and 11% of our revenue was generated by customers outside of the United States, respectively. Operationally, we expect to continue to expand our global employee headcount in India.
Previous wording
In the three months ended March 31, 2026 and 2025, usage-based revenue represented 91% and 90% of total revenue, respectively, and subscription revenue fees represented 9% and 10% of total revenue, respectively.
Current wording
For each of the three and six months ended June 30, 2026, usage-based revenue represented 92% of total revenue and subscription revenue fees represented 8% of total revenue. In the three and six months ended June 30, 2025, usage-based revenue represented 90% and 89% of total revenue, respectively, and subscription revenue fees represented 10% and 11% of total revenue, respectively.
Previous wording
Research and development expenses consist primarily of personnel-related costs for our development team, including salaries, benefits, bonuses, stock-based compensation expenses and allocated overhead costs. Research and development expenses also include contractor or professional services fees and third-party cloud infrastructure expenses incurred in developing our product offerings. We expect that our research and development expenses will remain relatively flat in absolute dollars but may fluctuate as a percentage of our revenue over time. In addition, research and development expenses that qualify as capitalized software development costs are capitalized, the amount of which may fluctuate significantly from period to period.
Current wording
Research and development expenses consist primarily of personnel-related costs for our development team, including salaries, benefits, bonuses, stock-based compensation expenses and allocated overhead costs. Research and development expenses also include contractor or professional services fees and third-party cloud infrastructure expenses incurred in developing our product offerings. We expect that our research and development expenses will increase modestly in absolute dollars but will decline as a percentage of our revenue over time. In addition, research and development expenses that qualify as capitalized software development costs are capitalized, the amount of which may fluctuate significantly from period to period.
Previous wording
Sales and marketing expenses consist primarily of personnel-related costs directly associated with our sales and marketing staff, including salaries, benefits, bonuses, commissions, stock-based compensation and allocated overhead costs. Sales and marketing expenses also include advertising costs and other expenses associated with our marketing and business development programs. In addition, sales and marketing expenses consist of travel-related expenses, software services dedicated for use by our sales and marketing organizations and outside services contracted for sales and marketing purposes. We expect that our sales and marketing expenses will remain relatively flat in absolute dollars and will continue to be our largest operating expense for the foreseeable future as we grow our business. Our sales and marketing expenses may fluctuate as a percentage of our revenue over time.
Current wording
Sales and marketing expenses consist primarily of personnel-related costs directly associated with our sales and marketing staff, including salaries, benefits, bonuses, commissions, stock-based compensation and allocated overhead costs. Sales and marketing expenses also include advertising costs and other expenses associated with our marketing and business development programs. In addition, sales and marketing expenses consist of travel-related expenses, software services dedicated for use by our sales and marketing organizations and outside services contracted for sales and marketing purposes. We expect that our sales and marketing expenses will increase modestly in absolute dollars and will continue to be our largest operating expense for the foreseeable future as we grow our business. Our sales and marketing expenses are expected to decrease as a percentage of our revenue over time.
Previous wording
General and administrative expenses consist of personnel-related costs associated with our finance, legal, human resources and administrative personnel, including salaries, benefits, bonuses, stock-based compensation and allocated overhead costs. General and administrative expenses also include external legal, accounting and other professional services fees, software services dedicated for use by our general and administrative functions, insurance and other corporate expenses. We expect that our general and administrative expenses will remain relatively flat in absolute dollars but may fluctuate as a percentage of total revenue from period to period.
Current wording
General and administrative expenses consist of personnel-related costs associated with our finance, legal, human resources and administrative personnel, including salaries, benefits, bonuses, stock-based compensation and allocated overhead costs. General and administrative expenses also include external legal, accounting and other professional services fees, software services dedicated for use by our general and administrative functions, insurance and other corporate expenses. We expect that our general and administrative expenses will increase modestly in absolute dollars but will decrease as a percentage of total revenue over time.
Previous wording
Total revenue increased by $5.2 million, or 14%, for the three months ended March 31, 2026 compared to the same period in 2025. Revenue related to new customers added since March 31, 2025 contributed $6.8 million, which was offset by a $1.6 million decrease in revenue from customers that existed as of March 31, 2025. The change in revenue from existing customers was driven by decreases in usage of our service offerings by several of our existing customers.
Current wording
Total revenue increased by $5.0 million, or 13%, for the three months ended June 30, 2026 compared to the same period in 2025. Revenue related to new customers added since June 30, 2025 contributed $5.9 million, which was partially offset by a $0.9 million decrease in revenue from customers that existed as of June 30, 2025. The change in revenue from existing customers was driven by decreases in usage of our service offerings by several of our existing customers.
Previous wording
Revenue generated from our software product offerings increased by $3.8 million, or 12%, for the three months ended March 31, 2026 compared to the same period in 2025 due to increases in usage of our software product offerings. Revenue generated from our services product offerings increased by $1.5 million, or 25%, for the three months ended March 31, 2026 compared to the same period in 2025 due to an increase in usage of our services product offerings.
Current wording
Revenue generated from our software product offerings increased by $4.1 million, or 13%, for the three months ended June 30, 2026 compared to the same period in 2025 due to increases in usage of our software product offerings. Revenue generated from our services product offerings increased by $0.9 million, or 18%, for the three months ended June 30, 2026 compared to the same period in 2025 due to an increase in usage of our services product offerings.
Previous wording
Total cost of revenue increased by $1.3 million, or 14%, for the three months ended March 31, 2026 compared to the same period in 2025. This change was primarily driven by a $0.7 million increase in costs for cloud hosting as a result of increased usage of our software product offerings and a $0.5 million increase in salary and benefits costs as a result of increased headcount.
Current wording
Total cost of revenue increased by $1.3 million, or 14%, for the three months ended June 30, 2026 compared to the same period in 2025. This change was primarily driven by a $0.7 million increase in costs for cloud hosting as a result of increased usage of our software product offerings, a $0.4 million increase in salary and benefits costs as a result of increased headcount, and an increase of $0.2 million in outsourced staffing vendor fees.
Previous wording
Sales and marketing expenses increased by $1.6 million, or 11%, for the three months ended March 31, 2026 compared to the same period in 2025. The change was driven by an increase of $1.1 million in personnel costs and an increase of $0.2 million in marketing expense.
Current wording
Sales and marketing expenses increased by $1.6 million, or 11%, for the three months ended June 30, 2026 compared to the same period in 2025. The change was primarily driven by an increase of $1.4 million in personnel costs, including commissions expense for our sales personnel.
Previous wording
General and administrative expenses decreased by $0.6 million, or 5%, for the three months ended March 31, 2026 compared to the same period in 2025. This change was primarily attributable to a decrease of $0.4 million in costs associated with company meetings and events.
Current wording
General and administrative expenses decreased by $2.1 million, or 9%, for the six months ended June 30, 2026 compared to the same period in 2025. This change was primarily attributable to a decrease of $2.1 million in legal costs related to the securities litigation, a decrease of $0.6 million in personnel costs, and a decrease in bad debt expense and insurance costs of
Previous wording
We have financed operations primarily through customer payments and net proceeds from sales of equity securities, including our IPO in July 2021. As of March 31, 2026, our principal sources of liquidity were cash and cash equivalents and short-term investments, totaling $17.6 million and $85.4 million, respectively. Cash equivalents include highly liquid investments that are readily convertible to known amounts of cash and have original maturities of three months or less. Short-term investments consist of highly-rated U.S. Treasury securities and corporate debt securities with maturities of more than three months but less than one year at the date of purchase. We believe our existing cash and cash equivalents and short-term investments will be sufficient to fund anticipated cash requirements for the next 12 months. We believe we will meet our longer-term expected future cash requirements primarily from a combination of cash flow from operating activities and available cash and cash equivalents and short-term investments. We may also engage in equity or debt financings to secure additional funds.
Current wording
We have financed operations primarily through customer payments and net proceeds from sales of equity securities, including our IPO in July 2021. As of June 30, 2026, our principal sources of liquidity were cash and cash equivalents and short-term investments, totaling $10.9 million and $90.5 million, respectively. Cash equivalents include highly liquid investments that are readily convertible to known amounts of cash and have original maturities of three months or less. Short-term investments consist of highly-rated U.S. Treasury securities and corporate debt securities with maturities of more than three months but less than one year at the date of purchase. We believe our existing cash and cash equivalents and short-term investments will be sufficient to fund anticipated cash requirements for the next 12 months. We believe we will meet our longer-term expected future cash requirements primarily from a combination of cash flow from operating activities and available cash and cash equivalents and short-term investments. We may also engage in equity or debt financings to secure additional funds.
Previous wording
Our principal cash requirements consist of obligations under our operating leases and purchase commitments to our cloud hosting providers and other vendors. There were no changes in our material cash requirements during the three months ended March 31, 2026 from the material cash requirements disclosed in our most recent Annual Report on Form 10-K.
Current wording
Our principal cash requirements consist of obligations under our operating leases and purchase commitments to our cloud hosting providers and other vendors. There were no changes in our material cash requirements during the six months ended June 30, 2026 from the material cash requirements disclosed in our most recent Annual Report on Form 10-K.
Previous wording
Net cash used in operating activities for the three months ended March 31, 2026 was $11.7 million, an increase of $1.2 million from net cash used in operating activities of $10.5 million for the three months ended March 31, 2025. The change in cash flow used in operations was primarily due to working capital charges, primarily related to accounts receivable due to timing of collection from our customers.
Current wording
Net cash used in operating activities for the six months ended June 30, 2026 was $12.8 million, a decrease of $2.0 million from net cash used in operating activities of $14.7 million for the six months ended June 30, 2025. The change in cash flow used in operations was primarily due to working capital charges.
Previous wording
Net cash provided by investing activities for the three months ended March 31, 2026 was $9.6 million, an increase of $17.2 million from net cash used in investing activities of $7.7 million for the three months ended March 31, 2025. The change in cash provided by (used in) investing activities was primarily related to an increase of $5.9 million in maturities of short-term investments and a decrease of $11.6 million in purchases of short-term investments during the three months ended March 31, 2026.
Current wording
Net cash provided by investing activities for the six months ended June 30, 2026 was $4.1 million, an increase of $20.4 million from net cash used in investing activities of $16.3 million for the six months ended June 30, 2025. The change in cash provided by (used in) investing activities was primarily related to maturities and purchases of short-term investments.
Previous wording
Net cash provided by financing activities for the three months ended March 31, 2026 was $0.1 million, an increase of $0.2 million from net cash used in financing activities of $0.1 million for the three months ended March 31, 2025. This change was primarily related to the final cash payment in 2025 for the acquisition of Congruity legal workflow products.
Current wording
Net cash used in financing activities for the six months ended June 30, 2026 was $0.1 million, consistent with net cash used in financing activities of $0.1 million for the six months ended June 30, 2025.
Rearranged current paragraphs (4)
Current report — wording carried from elsewhere
Total revenue increased by $10.3 million, or 14%, for the six months ended June 30, 2026 compared to the same period in 2025. Revenue related to new customers added since June 30, 2025 contributed $11.7 million, which was partially offset by a $1.4 million decrease in revenue from customers that existed as of June 30, 2025. The change in revenue from existing customers was driven by decreases in usage of our service offerings by several of our existing customers.
Current report — wording carried from elsewhere
Revenue generated from our software product offerings increased by $7.9 million, or 12%, for the six months ended June 30, 2026 compared to the same period in 2025 due to increases in usage of our software product offerings. Revenue generated from our services product offerings increased by $2.4 million, or 22%, for the six months ended June 30, 2026 compared to the same period in 2025 due to an increase in usage of our services product offerings.
Current report — wording carried from elsewhere
Total cost of revenue increased by $2.6 million, or 14%, for the six months ended June 30, 2026 compared to the same period in 2025. This change was primarily driven by a $1.4 million increase in costs for cloud hosting as a result of increased usage of our software product offerings, a $0.8 million increase in salary and benefits costs as a result of increased headcount, and an increase of $0.2 million in outsourced staffing vendor fees.
Current report — wording carried from elsewhere
We will cease to qualify as an emerging growth company as of December 31, 2026. At such time, we will no longer be able to take advantage of any of the exemptions from various reporting requirements that are applicable to other public companies that are not “emerging growth companies” as described above.