KALTURA INC

Previous wording

In August 2025, our Board of Directors approved a reorganization plan (the “2025 Reorganization Plan) that included, among other things, downsizing approximately 10% of our workforce and adapting our organizational structure, roles, and responsibilities accordingly. The total cost reduction from the downsizing in connection with the 2025 Reorganization Plan on an annualized basis is expected to be approximately $8.5 million. The 2025 Reorganization Plan is focused on realigning the Company’s operations to further increase efficiency and productivity, following the adoption of enhanced AI-based technologies aimed to increase efficiency and productivity throughout the Company’s operations, align the Company’s business strategy in light of uncertainties in the current macro-economic climate, and support the Company’s growth and profitability initiatives. In connection with the 2025 Reorganization Plan, we expect to incur pre-tax charges of approximately $0.7 million, primarily for severance and related costs, all of which are expected to be expensed in the third quarter of 2025. All of these charges are expected to result in cash expenditures. The 2025 Reorganization Plan is expected to be substantially completed in the third quarter of 2025.

Current wording

In August 2025, our Board of Directors approved a reorganization plan (the “2025 Reorganization Plan) that included, among other things, downsizing approximately 10% of our workforce and adapting our organizational structure, roles, and responsibilities accordingly. The total cost reduction from the downsizing in connection with the 2025 Reorganization Plan on an annualized basis is expected to be approximately $8.5 million. The 2025 Reorganization Plan is focused on realigning the Company’s operations to further increase efficiency and productivity, following the adoption of enhanced AI-based technologies aimed to increase efficiency and productivity throughout the Company’s operations, align the Company’s business strategy in light of uncertainties in the current macro-economic climate, and support the Company’s growth and profitability initiatives. In connection with the 2025 Reorganization Plan, we incurred pre-tax charges of $0.8 million, during the three months ended 30 September, 2025, primarily for severance and related costs.

Previous wording

Reflected below is a summary of reportable segment revenue and reportable segment gross profit for the three and six months ended June 30, 2025 and 2024.

Current wording

Reflected below is a summary of reportable segment revenue and reportable segment gross profit for the three and nine months ended September 30, 2025 and 2024.

Previous wording

We employ a "land and expand strategy" with the aim of having our customers increase their usage of our offerings and/or purchase additional offerings over time. Our Net Dollar Retention Rate (as defined below) measures our success in retaining and growing recurring revenue from our existing customers over a given period. For the three months ended June 30, 2025 and 2024, our Net Dollar Retention Rate was 101% and 98%, respectively. We grew our Annualized Recurring Revenue (as defined below) by 3% in the three months ended June 30, 2025, compared to the three months ended June 30, 2024, demonstrating our ability to land new customers with higher spending levels and increase revenue from our existing customers.

Current wording

We employ a "land and expand strategy" with the aim of having our customers increase their usage of our offerings and/or purchase additional offerings over time. Our Net Dollar Retention Rate (as defined below) measures our success in retaining and growing recurring revenue from our existing customers over a given period. For the three months ended September 30, 2025 and 2024, our Net Dollar Retention Rate was 97% and 101%, respectively. Our Annualized Recurring Revenue (as defined below) grew slightly in three months ended September 30, 2025, compared to three months ended September 30, 2024, demonstrating our ability to land new customers with higher spending levels and increase revenue from our existing customers.

Previous wording

Many of our customers run multiple Kaltura products for various use cases, ranging from employee training and collaboration to external marketing and virtual events. By cross-selling and upselling additional solutions — such as our newly introduced Gen AI-powered capabilities and expanded application suites — we aim to drive higher usage and expand overall revenue. Our strong integration, ongoing support, and a commitment to evolving security and compliance requirements also helps us support sustained customer adoption and usage growth. We are focused on increasing sales within our existing customer base through increased usage of our platform and the cross-selling of additional products and solutions. For the three months ended June 30, 2025, our Net Dollar Retention Rate was 101%. In order for us to increase revenue within our customer base, we will need to maintain engineering-level customer support and continue to introduce new products and features as well as innovative new use cases that are tailored to our customers' needs.

Current wording

Many of our customers run multiple Kaltura products for various use cases, ranging from employee training and collaboration to external marketing and virtual events. By cross-selling and upselling additional solutions — such as our newly introduced Gen AI-powered capabilities and expanded application suites — we aim to drive higher usage and expand overall revenue. Our strong integration, ongoing support, and a commitment to evolving security and compliance requirements also helps us support sustained customer adoption and usage growth. We are focused on increasing sales within our existing customer base through increased usage of our platform and the cross-selling of additional products and solutions. For the three months ended September 30, 2025, our Net Dollar Retention Rate was 97%. In order for us to increase revenue within our customer base, we will need to maintain engineering-level customer support and continue to introduce new products and features as well as innovative new use cases that are tailored to our customers' needs.

Previous wording

Remaining Performance Obligations represents the amount of contracted future revenue that has not yet been delivered, including both subscription and professional services revenues. Remaining Performance Obligations consists of both deferred revenue and contracted non-cancelable amounts that will be invoiced and recognized in future periods. As of June 30, 2025, our Remaining Performance Obligations was $188.1 million, which consists of both billed consideration in the amount of $55.1 million and unbilled consideration in the amount of $133.0 million that we expect to invoice and recognize in future periods.

Current wording

Remaining Performance Obligations represents the amount of contracted future revenue that has not yet been delivered, including both subscription and professional services revenues. Remaining Performance Obligations consists of both deferred revenue and contracted non-cancelable amounts that will be invoiced and recognized in future periods. As of September 30, 2025, our Remaining Performance Obligations was $159.3 million, which consists of both billed consideration in the amount of $61.1 million and unbilled consideration in the amount of $98.2 million that we expect to invoice and recognize in future periods.

Previous wording

We expect to recognize 61% of our Remaining Performance Obligations as revenue over the next 12 months and the remainder over the next four years, in each case, in accordance with our revenue recognition policy.

Current wording

We expect to recognize 60% of our Remaining Performance Obligations as revenue over the next 12 months and the over the next four years, in each case, in accordance with our revenue recognition policy.

Previous wording

We define EBITDA as net profit (loss) before financial expenses (income), net, provision for income taxes and depreciation and amortization expenses. Adjusted EBITDA is defined as EBITDA (as defined above), adjusted for the impact of certain non-cash and other items that we believe are not indicative of our core operating performance, such as non-cash stock-based compensation expenses, war-related expenses and certain professional, consulting and other expenses associated with strategic initiatives.

Current wording

We define EBITDA as net profit (loss) before financial expenses (income), net, provision for income taxes and depreciation and amortization expenses. Adjusted EBITDA is defined as EBITDA (as defined above), adjusted for the impact of certain non-cash and other items that we believe are not indicative of our core operating performance, such as non-cash stock-based compensation expenses, war-related expenses, restructuring charges and certain professional consulting and other expenses associated with strategic initiatives.

Previous wording

EBITDA and Adjusted EBITDA are presented because we believe that they provide useful supplemental information to investors and analysts regarding our operating performance and are frequently used by these parties in evaluating companies in our industry. By presenting EBITDA and Adjusted EBITDA, we provide a basis for comparison of our business operations between periods by excluding items that we do not believe are indicative of our core operating performance. We believe that investors’ understanding of our performance is enhanced by including these non-GAAP financial measures as a reasonable basis for comparing our ongoing results of operations. Additionally, our management uses Adjusted EBITDA as a supplemental measure of our performance because it assists us in comparing the operating performance of our business on a consistent basis between periods, as described above.

Current wording

EBITDA and Adjusted EBITDA are supplemental measure of our performance, are not defined by or presented in accordance with GAAP, and should not be considered in isolation or as an alternative to net profit (loss) or any other performance measure prepared in accordance with GAAP. EBITDA and Adjusted EBITDA are presented because we believe that they provide useful supplemental information to investors and analysts regarding our operating performance and are frequently used by these parties in evaluating companies in our industry. By presenting EBITDA and Adjusted EBITDA, we provide a basis for comparison of our business operations between periods by excluding items that we do not believe are indicative of our core operating performance. We believe that investors’ understanding of our performance is enhanced by including these non-GAAP financial measures as a reasonable basis for comparing our ongoing results of operations. Additionally, our management uses Adjusted EBITDA as a supplemental measure of our performance because it assists us in comparing the operating performance of our business on a consistent basis between periods, as described above.

Previous wording

(a)The three months ended June 30, 2025 and 2024, and the six months ended June 30, 2025 and 2024 include $602, $702, $1,210 and $1,406, respectively, of interest expenses and $737, $790, $1,632 and $1,608, respectively of interest income.

Current wording

(a)The three months ended September 30, 2025 and 2024, and the nine months ended September 30, 2025 and 2024, include $527, $725, $1,737 and $2,131 respectively, of interest expenses and $751,$845,$2,383 and$2,453, respectively of interest income.

Previous wording

(b)Strategic initiatives for the three and six months ended June 30, 2025 relate to professional, consulting and other costs associated with strategic initiatives of $1,632.

Current wording

(b)Strategic initiatives for the three and nine months ended September 30, 2025 relate to professional, consulting and other costs associated with strategic initiatives. The three and nine months ended September 30, 2025 include vendor credit and discounted pricing for expenses recognized during the three months ended June 30, 2025.

Previous wording

(c)The three and six months ended June 30, 2024 include costs related to conflicts in Israel, attributable to temporary relocation of key employees from Israel for business continuity purposes, purchase of emergency equipment for key employees for business continuity purposes, and charitable donation to communities directly impacted by the war.

Current wording

(d)The nine months ended September 30, 2024 include costs related to conflicts in Israel, attributable to temporary relocation of key employees from Israel for business continuity purposes, purchase of emergency equipment for key employees for business continuity purposes, and charitable donation to communities directly impacted by the war.

Previous wording

Components of Our Results of Operation

Current wording

Components of Our Results of Operations

Previous wording

Cost of revenue decreased in absolute dollars in the three and six months ended June 30, 2025 from the three and six months ended June 30, 2024. For the three months ended June 30, 2025 and 2024, and for the six months ended June 30, 2025 and 2024, our cost of revenue was $13,243, $15,356, $27,491 and $31,529, respectively.

Current wording

For the three months ended September 30, 2025 and 2024, and for the nine months ended September 30, 2025 and 2024, our cost of revenue was $13,139, $14,754, $40,629 and $46,283, respectively.

Previous wording

For the three months ended June 30, 2025 and 2024, our gross margins were 70% (77% for subscriptions and (73)% for professional services) and 65% (74% for subscriptions and (49)% for professional services), respectively. For the six months ended June 30, 2025 and 2024, our gross margins were 70% (77% for subscriptions and (77)% for professional services) and 64% (73% for subscriptions and (40)% for professional services), respectively.

Current wording

For the three months ended September 30, 2025 and 2024, our gross margins were 70% (77% for subscriptions and (74)% for professional services) and 67% (75% for subscriptions and (95)% for professional services), respectively. For the nine months ended September 30, 2025 and 2024, our gross margins were 70% (77% for subscriptions and (77)% for professional services) and 65% (74% for subscriptions and (54)% for professional services), respectively.

Previous wording

For our EE&T segment, gross margins for the three months ended June 30, 2025 and 2024, were 78% (84% for subscription and (226)% for professional services), and 74% (81% for subscription and (87)% for professional services), respectively. For the six months ended June 30, 2025 and 2024, our gross margins for our EE&T segment were 78% (84% for subscriptions and (192)% for professional services) and 73% (80% for subscriptions and (56)% for professional services), respectively.

Current wording

For our EE&T segment, gross margins for the three months ended September 30, 2025 and 2024, were 76% (82% for subscription and (317)% for professional services), and 76% (82% for subscription and (154)% for professional services), respectively. For the nine months ended September 30, 2025 and 2024, our gross margins were 77% (83% for subscriptions and (225)% for professional services) and 74% (81% for subscriptions and (78)% for professional services), respectively.

Previous wording

For our M&T segment, gross margins for the three months ended June 30, 2025 and 2024 were 48% (55% for subscriptions and (1)% for professional services) and 44% (55% for subscriptions and (24)% for professional services), respectively. For the six months ended June 30, 2025 and 2024, our gross margins for our M&T segment were 48% (56% for subscription and (14)% for professional services) and 42% (54% for subscription and (26)% for professional services), respectively.

Current wording

For our M&T segment, gross margins for the three months ended September 30, 2025 and 2024 were 54% (58% for subscriptions and 20% for professional services) and 42% (55% for subscriptions and (59)% for professional services), respectively. For the nine months ended September 30, 2025 and 2024, our gross margins were 50% (57% for subscription and (2)% for professional services) and 42% (54% for subscription and (35)% for professional services), respectively.

Previous wording

Financial expenses (income), net consists of interest expense accrued or paid on our indebtedness, net of interest income earned on our cash balances and marketable securities. Financial expenses (income), net also includes foreign exchange gains and losses and bank fees.

Current wording

Financial expense (income), net consists of interest expense accrued or paid on our indebtedness, net of interest income earned on our cash balances and marketable securities. Financial expense (income), net also includes foreign exchange gains and losses and bank fees.

Previous wording

•Enterprise, Education & Technology (75% and 70% of revenue for the three months ended June 30, 2025 and 2024, respectively, and 74% and 71% for the six months ended June 30, 2025 and 2024): Our EE&T segment represents revenues from all of our products, industry solutions for education customers, and Media Services (except for M&T customers), as well as associated professional services for those offerings.

Current wording

•Enterprise, Education & Technology (74% and 73% of revenue for the three months ended September 30, 2025 and 2024, respectively, and 74% and 72% for the nine months ended September 30, 2025 and 2024): Our EE&T segment represents revenues from all of our products, industry solutions for education customers, and Media Services (except for M&T customers), as well as associated professional services for those offerings.

Previous wording

•Media & Telecom (25% and 30% of revenue for the three months ended June 30, 2025 and 2024, respectively, and 26% and 29% for the six months ended June 30, 2025 and 2024): Our M&T segment primarily represents revenues from our TV Solution and Media Services sold to media and telecom customers.

Current wording

•Media & Telecom (26% and 27% of revenue for the three months ended September 30, 2025 and 2024, respectively, and 26% and 28% for the nine months ended September 30, 2025 and 2024): Our M&T segment primarily represents revenues from our TV Solution and Media Services sold to media and telecom customers.

Previous wording

EE&T gross profit increased by $2.9 million, or 13%, to $25.9 million for the three months ended June 30, 2025, from $22.9 million for the three months ended June 30, 2024. This increase was mainly due to the increase in revenue and reduction in production costs, which is a result of improved efficiency.

Current wording

EE&T subscription gross profit increased by $0.4 million, or 1%, to $26.2 million for the three months ended September 30, 2025, from $25.8 million for the three months ended September 30, 2024. This Increase was mainly due to the increase in revenue.

Previous wording

EE&T professional services gross loss increased by $0.5 million, or 45%, to $1.5 million for the three months ended June 30, 2025, from $1.0 million for the three months ended June 30, 2024.

Current wording

EE&T professional services gross loss increased by $0.4 million, or 29%, to a gross loss of $1.7 million for the three months ended September 30, 2025, from a gross loss of $1.3 million for the three months ended September 30, 2024. The Increase was primarily due to a reduction in professional services revenue.

Previous wording

M&T revenue decreased by $1.8 million, or 14%, to $11.2 million for the three months ended June 30, 2025, from $13.1 million for the three months ended June 30, 2024. The decrease is mainly due to a $1.9 million decrease in revenue from existing customers.

Current wording

M&T revenue decreased by $0.5 million, or 4%, to $11.5 million for the three months ended September 30, 2025, from $12.0 million for the three months ended September 30, 2024. The decrease is mainly attributable to a $0.5 million decrease in revenue from existing customers.

Previous wording

M&T professional services revenue decreased by $0.4 million, or 23%, to $1.4 million for the three months ended June 30, 2025, from $1.8 million for the three months ended June 30, 2024.

Current wording

M&T professional services revenue decreased slightly, to $1.4 million for the three months ended September 30, 2025, from $1.4 million for the three months ended September 30, 2024.

Previous wording

M&T subscription gross profit increased by $0.1 million, or 1%, to $11.9 million for the six months ended June 30, 2025, from $11.8 million for the six months ended June 30, 2024.

Current wording

M&T subscription gross profit increased by $0.1 million, or 2%, to $5.9 million for the three months ended September 30, 2025, from $5.8 million for the three months ended September 30, 2024.

Previous wording

Research and development expenses decreased by $0.4 million, or 2%, to $23.7 million for the six months ended June 30, 2025, from $24.0 million for the six months ended June 30, 2024. The decrease was primarily due to a $0.4 million decrease in subcontractor and consultant costs, primarily attributable to reduced use of outsourced resources, and a $0.2 million decrease in compensation expenses, largely driven by the full recognition of high fair value RSUs granted in December 2021, which were fully expensed prior to 2025

Current wording

Research and development expenses decreased by $0.9 million, or 8%, to $11.5 million for the three months ended September 30, 2025, from $12.4 million for the three months ended September 30, 2024. The decrease was primarily due to a $0.7 million decrease in compensation expenses, mainly due to stock-based compensation, largely driven by the full recognition of high fair value RSUs granted in December 2021, which were fully expensed prior to 2025. An additional $0.2 million decrease in subcontractor and consultant costs was primarily attributable to reduced use of outsourced resources.

Previous wording

Financial expense (income), net decreased by $5.6 million, or 552%, to $4.6 million expense for the three months ended June 30, 2025, from $1.0 million income for the three months ended June 30, 2024. The decrease was primarily due to $5.5 million related to exchange rate differences.

Current wording

Financial Income, net decreased by $2.1 million, to $0.1 million for the three months ended September 30, 2025, from $2.2 million for the three months ended September 30, 2024. The decrease was primarily due to $2.2 million related to exchange rate differences.

Previous wording

Provision for income taxes decreased by $2.0 million or 83%, to $0.4 million for the three months ended June 30, 2025, from $2.5 million for the three months ended June 30, 2024 primarily due to decreased tax liability related to income generated by our subsidiaries organized under the laws of Israel and the United Kingdom.

Current wording

Provision for income taxes decreased by $0.1 million, or 7%, to $1.2 million for the three months ended September 30, 2025, from $1.3 million for the three months ended September 30, 2024, primarily due to decreased tax liability related to income generated by our subsidiaries organized under the laws of Israel and the United Kingdom

Previous wording

Total EE&T revenue increased by $4.3 million, or 7%, to $67.7 million for the six months ended June 30, 2025, from $63.4 million for the six months ended June 30, 2024. The increase is mainly attributable to a $2.2 million increase in revenue from new customers and $2.1 million increase in revenue from existing customers.

Current wording

Total EE&T revenue increased by $4.3 million, or 4%, to $100.0 million for the nine months ended September 30, 2025, from $95.7 million for the nine months ended September 30, 2024. The increase is mainly attributable to a $2.0 million increase in revenue from new customers and $2.2 million increase in revenue from existing customers.

Previous wording

EE&T professional services revenue decreased by $0.5 million, or 44%, to $0.7 million for the three months ended June 30, 2025, from $1.2 million for the three months ended June 30, 2024. The decrease in professional services revenue mainly reflects the transition of certain development projects to ongoing support and maintenance, now recognized as subscription revenue.

Current wording

EE&T professional services revenue decreased by $1.8 million, or 48%, to $2.0 million for the nine months ended September 30, 2025 from $3.8 million for the nine months ended September 30, 2024. The decrease in professional services revenue mainly reflects the transition of certain development projects to ongoing support and maintenance, now recognized as subscription revenue.

Previous wording

EE&T gross profit increased by $5.9 million, or 13%, to $52.4 million for the six months ended June 30, 2025, from $46.5 million for the six months ended June 30, 2024. This increase was mainly due to a $4.3 million increase in revenue and reduction in production costs, which is a result of improved efficiency.

Current wording

EE&T gross profit increased by $6.0 million, or 8%, to $77.0 million for the nine months ended September 30, 2025, from $71.0 million for the nine months ended September 30, 2024. This increase was mainly due to a $4.3 million increase in revenue and reduction in production costs, which is a result of improved efficiency.

Previous wording

EE&T subscription revenue increased by $5.8 million, or 10%, to $66.2 million for the six months ended June 30, 2025, from $60.4 million for the six months ended June 30, 2024.

Current wording

EE&T subscription gross profit increased by $7.5 million, or 10%, to $81.5 million for the nine months ended September 30, 2025, from $74.0 million for the nine months ended September 30, 2024.

Previous wording

EE&T professional services gross loss increased by $1.2 million, or 69%, to a gross loss of $2.8 million for the six months ended June 30, 2025, from a gross loss of $1.7 million for the six months ended June 30, 2024.

Current wording

EE&T professional services gross loss increased by $1.5 million, or 52%, to a gross loss of $4.5 million for the nine months ended September 30, 2025, from a gross loss of $3.0 million for the nine months ended September 30, 2024.

Previous wording

M&T revenue decreased by $1.6 million, or 6%, to $23.8 million for the six months ended June 30, 2025, from $25.4 million for the six months ended June 30, 2024. The decrease is mainly attributable to a decrease in revenue from existing customers.

Current wording

M&T revenue decreased by $2.1 million, or 6%, to $35.3 million for the nine months ended September 30, 2025, from $37.4 million for the nine months ended September 30, 2024. The decrease is mainly attributable to revenue from existing customers.

Previous wording

M&T subscription revenue decreased by $0.6 million, or 3%, to $21.1 million for the six months ended June 30, 2025, from $21.8 million for the six months ended June 30, 2024.

Current wording

M&T subscription revenue decreased by $1.1 million, or 3%, to $31.3 million for the nine months ended September 30, 2025, from $32.3 million for the nine months ended September 30, 2024.

Previous wording

M&T professional services revenue decreased by $1.0 million, or 27%, to $2.7 million for the six months ended June 30, 2025, from $3.7 million for the six months ended June 30, 2024.

Current wording

M&T professional services revenue decreased by $1.0 million, or 19%, to $4.0 million for the nine months ended September 30, 2025, from $5.0 million for the nine months ended September 30, 2024.

Previous wording

M&T gross profit increased by $0.7 million, or 7%, to $11.5 million for the six months ended June 30, 2025, from $10.8 million for the six months ended June 30, 2024. This increase was mainly due to reduction in production and other costs, which is a result of improved efficiency.

Current wording

M&T gross profit increased by $1.9 million, or 12%, to $17.7 million for the nine months ended September 30, 2025, from $15.8 million for the nine months ended September 30, 2024. This increase was mainly due to reduction in production and other costs, which is a result of improved efficiency.

Previous wording

Research and development expenses decreased by $0.5 million, or 4%, to $11.6 million for the three months ended June 30, 2025, from $12.0 million for the three months ended June 30, 2024. The decrease was primarily due to a $0.3 million decrease in compensation expenses, mainly due to stock-based compensation, largely driven by the full recognition of high fair value RSUs granted in December 2021, which were fully expensed prior to 2025. Additional impact is related to the impact of expired hedging transactions. The hedging positions, which were executed at more favorable ILS/USD exchange rates than those prevailing during the period, resulted in a positive offset to payroll-related expenses denominated in ILS. An additional $0.2 million decrease in subcontractor and consultant costs was primarily attributable to reduced use of outsourced resources.

Current wording

Research and development expenses decreased by $1.3 million, or 4%, to $35.1 million for the nine months ended September 30, 2025, from $36.5 million for the nine months ended September 30, 2024. The decrease was primarily due to a $1.0 million decrease in compensation expenses, mainly due to stock-based compensation, largely driven by the full recognition of high fair value RSUs granted in December 2021, which were fully expensed prior to 2025, partially offset due to higher headcount and to a $0.6 million decrease in subcontractor and consultant costs, primarily attributable to reduced use of outsourced resources.

Previous wording

Sales and marketing expenses decreased by $0.3 million, or 2%, to $11.5 million for the three months ended June 30, 2025, from $11.8 million for the three months ended June 30, 2024. The decrease was primarily driven by a $0.3 million reduction in compensation expenses, mainly due to lower headcount and full recognition of high fair value RSUs granted in December 2021, which were fully expensed prior to 2025.

Current wording

Sales and marketing expenses decreased by $0.9 million, or 3%, to $34.5 million for the nine months ended September 30, 2025, from $35.4 million for the nine months ended September 30, 2024. The decrease was primarily due to a $1.4 million decrease in compensation expenses mainly due to lower headcount and full recognition of high fair value RSUs granted in December 2021, which were fully expensed prior to 2025.

Previous wording

General and administrative expenses decreased by $4.3 million, or 17%, to $21.2 million for the six months ended June 30, 2025, from $25.5 million for the six months ended June 30, 2024. The decrease was primarily due to a $4.4 million reduction in compensation costs, mainly driven by expense acceleration recognized in the comparative period in connection with the cancellation of unvested market-based equity awards granted to the Chief Executive Officer, and by lower stock-based compensation costs, largely reflecting the full recognition of high fair value options and RSUs granted in December 2021, which were fully expensed prior to 2025. The decrease also reflects a $1.3 million one-time expense in 2024 associated with the termination of commitments with a cloud hosting service provider, partially offset by a $1.6 million increase in corporate adjustment costs, mainly due to professional, consulting, and other costs associated with strategic initiatives.

Current wording

General and administrative expenses decreased by $5.2 million, or 15%, to $30.1 million for the nine months ended September 30, 2025, from $35.3 million for the nine months ended September 30, 2024. The decrease was primarily due to a $4.4 million decrease in compensation costs mainly driven by expense acceleration recognized in the comparative period in connection with the cancellation of unvested market-based equity awards granted to the Chief Executive Officer, and by lower stock-based compensation costs, largely reflecting the full recognition of high fair value options and RSUs granted in December 2021, which were fully expensed prior to 2025. The decrease also reflects a $1.3 million one-time expense in 2024 associated with the termination of commitments with a cloud hosting service provider. These were partially offset by a $1.3 million increase in strategic initiatives costs, mainly due to professional, consulting, and other costs associated with strategic initiatives.

Previous wording

Financial expense (income), net increased by $2.3 million, or 467%, to $2.8 million expenses for the six months ended June 30, 2025, from $0.5 million expenses for the six months ended June 30, 2024. The increase was primarily due to an increase of $2.4 million related to exchange rate differences partially offset by $0.2 million of higher interest income associated with our investments.

Current wording

Financial expense (income), net changed by $4.4 million to $2.7 million expense for the nine months ended September 30, 2025, from $1.7 million income for the nine months ended September 30, 2024. The change was primarily due to an increased expense of $4.6 million related to exchange rate differences partially offset by $0.4 million lower interest expense resulting from principal repayments made during the period.