Ibotta, Inc.

The following tables set forth our results of operations for each of the periods presented (in thousands):

(1)Amounts include stock-based compensation expense, inclusive of common stock warrant expense within sales and marketing, as follows (in thousands):

Comparison of the years ended December 31, 2025 and 2024

Revenue

Total redemption revenue decreased $11.6 million, or 4%, during the year ended December 31, 2025, compared to the year ended December 31, 2024, due to a $33.8 million decrease in revenue from D2C properties, partially offset by a $22.2 million increase in revenue from third-party publishers. The decrease in D2C redemption revenue was driven primarily by a decrease in the quantity and quality of offers available to each D2C redeemer. The increase in third-party publisher redemption revenue was primarily driven by the launch of new partners, namely Instacart and DoorDash.

Ad & other revenue decreased $13.3 million, or 23%, during the year ended December 31, 2025, compared to the year ended December 31, 2024, driven by reduced client spend on D2C ad products.

Cost of Revenue

Cost of revenue increased $20.9 million, or 42%, during the year ended December 31, 2025, compared to the year ended December 31, 2024, due primarily to the addition of new publishers.

Sales and marketing

Sales and marketing decreased $20.3 million, or 15%, during the year ended December 31, 2025, compared to the year ended December 31, 2024, due to decreases of $20.4 million in stock-based compensation expense, $2.1 million in media spend, $2.1 million in self-funded rewards, and $1.6 million in B2B marketing. The decrease in stock-based compensation was driven by decreases of $20.5 million related to the Walmart Warrant for additional shares granted upon the closing of the IPO in 2024 under the Walmart Warrant’s anti-dilution provision, $1.9 million related to equity awards with a liquidity event-based vesting condition that was satisfied in connection with the IPO in 2024, and $1.4 million related to the departure of sales executives, partially offset by an increase of $3.5 million in recurring equity compensation. The decreases in media spend, self-funded rewards, and B2B marketing resulted from a shift in marketing strategy. These decreases were partially offset by increases of $5.4 million in personnel-related costs and $0.5 million in professional fees. The increase in personnel-related costs was primarily driven by $1.5 million of restructuring charges and the remainder by increases in sales bonus, average salary, and benefits expenses.

Research and development

Research and development decreased $2.2 million, or 3%, during the year ended December 31, 2025, compared to the year ended December 31, 2024, due to decreases of $2.7 million in personnel-related costs, excluding stock-based compensation, and $0.7 million in software licensing costs, partially offset by an increase of $0.9 million in stock-based compensation expense. The decrease in personnel-related costs, excluding stock-based compensation, was primarily related to higher capitalization due to increased investment in our platform, capabilities, and infrastructure, partially offset by $0.7 million of restructuring charges during the year ended December 31, 2025. The increase in stock-based compensation was driven by a $4.4 million increase in recurring equity compensation, partially offset by decreases of $1.6 million related to equity awards with a liquidity event-based vesting condition that was satisfied in connection with the IPO in 2024 and $1.8 million related to a reallocation of resources and related personnel costs to cost of revenue due to continued investment in our platform, capabilities, and infrastructure.

General and administrative

General and administrative increased $5.5 million, or 7%, during the year ended December 31, 2025, compared to the year ended December 31, 2024, due to increases of $5.8 million in professional fees largely attributable to legal matters, $2.3 million in facilities costs due to the commencement of a new office space lease in the first quarter of 2025, $1.6 million in software licensing costs, and $0.7 million in bad debt expense. These increases were partially offset by a $5.0 million decrease in stock-based compensation expense driven by decreases of $8.3 million related to equity awards with a liquidity event-based vesting condition that was satisfied in connection with the IPO in 2024 and $1.6 million from the reversal of previously recognized expense for unvested equity awards related to the departure of the Company’s former chief financial officer in March 2025, partially offset by a $4.9 million increase in recurring equity compensation.

Depreciation and amortization

Depreciation and amortization did not change meaningfully during the year ended December 31, 2025, compared to the year ended December 31, 2024.

Interest income, net

Interest income, net, increased $1.4 million, or 15%, during the year ended December 31, 2025, compared to the year ended December 31, 2024, due to a $3.1 million decrease in interest expense resulting from the extinguishment of the convertible notes upon IPO in 2024, partially offset by a $1.8 million decrease in interest income driven by decreases in interest rates and cash and cash equivalents.

Loss on extinguishment of debt

Loss on extinguishment of debt decreased $9.7 million during the year ended December 31, 2025, compared to the year ended December 31, 2024, primarily due to the conversion of the convertible notes into shares of our Class A common stock concurrently upon the closing of the IPO in 2024.

Other expense, net

Other expense, net, decreased $3.1 million, or 97%, during the year ended December 31, 2025, compared to the year ended December 31, 2024, primarily due to a $3.1 million decrease in the loss on the convertible notes derivative liability, which was settled in connection with the IPO in 2024.

(Provision for) benefit from income taxes

The provision for income taxes increased $50.5 million during the year ended December 31, 2025, compared to the year ended December 31, 2024, primarily due to the tax benefit from the 2024 valuation allowance release, as well as the impact of non-deductible items including certain executive compensation costs, stock-based compensation, and the tax expenses related to uncertain tax positions.

Liquidity and Capital Resources

As of December 31, 2025, our principal sources of liquidity included $186.6 million of cash and cash equivalents and $99.0 million of available capacity under a revolving line of credit.

Our primary cash needs are for personnel-related expenses, sales and marketing expenses, reward and revenue share and related minimum commitments, data hosting costs, and software licensing costs. We believe our existing liquidity and cash flows from operating activities will be sufficient to meet our projected operating and capital requirements for at least the next 12 months.

Our future cash requirements will depend on many factors, including our pace of growth, the timing and extent of spend to support research and development efforts, the timing of cash collected from clients, the expansion of sales and marketing activities, the introduction of new and enhanced platform offerings, and the volume and timing of our share repurchases. As a result of these and other factors, we may be required to seek additional equity or debt financing. If additional financing is required from outside sources, we may not be able to raise it on terms acceptable to us, or at all. Further, our future capital requirements and the adequacy of available funds will depend on many factors, including those set forth in Part I, Item 1A. “Risk Factors” of this Annual Report on Form 10-K. If we are unable to raise additional capital when desired, our business, financial condition, results of operations, and prospects would be adversely affected.

2024 Credit Facility

On December 5, 2024, we entered into a Credit Agreement with Bank of America, N.A., as administrative agent, swingline lender, and L/C issuer, which provides us with revolving commitments in an aggregate principal amount of $100.0 million and matures on December 5, 2029 (2024 Credit Facility). The 2024 Credit Facility also allows the Company to request incremental revolving commitments of up to $100.0 million. As of December 31, 2025, we had no outstanding borrowings under the 2024 Credit Facility and availability of $99.0 million, which is net of a $1.0 million outstanding letter of credit related to an office space lease. For further details regarding the credit agreement, see Note 6 -Long-Term Debt to our financial statements included in Part II, Item 8 of this Annual Report on Form 10-K.

Common Stock Warrant

On May 17, 2021, we issued the Walmart Warrant in connection with a multi-year strategic relationship that makes Ibotta the exclusive provider of digital item-level rebate offer content for Walmart U.S. If the shares available for exercise as of December 31, 2025 were fully exercised, the warrants could provide up to $245.6 million in proceeds to us. However, the exercisability of a portion of the Walmart Warrant is subject to certain performance conditions and forfeiture features, and there can be no assurance that any such warrant will be exercised. For further details regarding the Walmart Warrant, see Note 9 - Stockholders' Equity to our financial statements included in Part II, Item 8 of this Annual Report on Form 10-K.

Share Repurchase Program

In August 2024, the Company’s board of directors approved a share repurchase program, with authorization to purchase up to an aggregate of$100.0 million of the Company’s Class A common stock (Share Repurchase Program). In both March 2025 and June 2025, the board of directors approved an additional$100 million, bringing the total authorization to $300.0 million.

The Share Repurchase Program has no expiration date. Repurchases under the Share Repurchase Program may be made from time to time through open market repurchases or through privately negotiated transactions 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 underthe Securities Exchange Act of 1934, as amended (Exchange Act). We may also, from time to time, enter into Rule 10b5-1 plans to facilitate repurchases of shares of our Class A common stock under this authorization. We are not obligated under the Share Repurchase Program to acquire any particular amount of Class A common stock, and we may terminate or suspend the Share Repurchase Program at any time. The timing and actual number of shares repurchased may depend on a variety of factors, including price, general business and market conditions, and alternative investment opportunities.

During theyear ended December 31, 2025, the Company repurchased 6,869,660 of its Class A common stock for an aggregate repurchase amount of $236.3 million. The repurchase amount includes immaterial broker commissions and the 1% excise tax on net share repurchases imposed by the Inflation Reduction Act of 2022. Repurchases are reflected as treasury stock on the balance sheetson a trade-date basis. As of December 31, 2025, $34.9 million remains available and authorized for repurchase under the Share Repurchase Program.

Cash Flows

The following table summarizes our cash flows for the periods presented:

Operating Activities

Our collection cycles can vary based on payment practices from our clients, and we are required to pay our third-party publishers within a contractual timeframe, regardless of whether we have collected payment from our client. As a result, timing of cash receipts related to accounts receivable and due to third-party publishers can vary from period to period and impact both positively or negatively our cash provided by operating activities for any period.

Net cash provided by operating activities decreased $20.6 million during the year ended December 31, 2025 compared to the year ended December 31, 2024. The decrease was the result of a $65.2 million decrease in net income offset by a $20.7 million increase in non-cash charges and a $23.8 million increase in net cash inflows from changes in operating assets and liabilities.

The increase in non-cash charges was primarily driven by the deferred income tax benefit in 2024 from the release of our valuation allowance, partially offset by non-cash charges incurred in 2024 in connection with the IPO, including accelerated stock-based compensation expense, common stock warrant expense, and losses on the extinguishment of the convertible notes and derivative liability.

The increase in net cash inflows from changes in operating assets and liabilities was primarily due to cash inflows of $21.1 million from other current and long-term assets and liabilities, $5.8 million from accounts receivable due to the timing of client payments, $5.1 million from accrued expenses primarily due to accrued excise taxes on share repurchases, $2.0 million from the user redemption liability, and $1.3 million from accounts payable. The increase in net cash inflows from other current and long-term assets and liabilities was primarily driven by the collection of the majority of the lease incentive receivable in 2025, a decrease in prepaid expenses, and a decrease in deferred tax assets as a result of the One Big Beautiful Bill Act enacted in 2025. These net cash inflows were partially offset by cash outflows of $7.2 million from liabilities due to third-party publishers driven by the timing and ramp up of new publishers and $4.4 million from deferred revenue.

Investing Activities

Net cash used in investing activities increased $24.1 million during the year ended December 31, 2025 compared to the year ended December 31, 2024, driven by a $19.4 million increase in additions to property and equipment related to leasehold improvements and furniture and fixtures for our new headquarters space and a $4.7 million increase in additions to capitalized software development costs.

Financing Activities

Net cash used in financing activities increased $405.4 million during the year ended December 31, 2025 compared to the year ended December 31, 2024, driven by $200.7 million of net IPO proceeds in 2024, a $201.7 million increase in purchases of treasury stock, and a decrease of $3.9 million in proceeds from the exercise of stock options and employee stock purchase plan.

Material Cash Requirements

Operating Leases

Our operating lease commitments primarily include our corporate office space. As of December 31, 2025, we had non-cancellable lease obligations of $36.8 million, of which $2.0 million is payable within 12 months, and the remainder thereafter. For additional discussion on our operating leases, refer to Note 8 – Operating Leases to our financial statements included in Part II, Item 8 of this Annual Report on Form 10-K.

Purchase Commitments

The Company has non-cancellable purchase obligations that relate to minimum commitments with certain third-party publishers and other contractual commitments primarily with software as a service providers in the ordinary course of business. As of December 31, 2025, we had fixed non-cancellable purchase obligations of $138.9 million, of which $38.4 million is payable within 12 months, and the remainder thereafter. For additional discussion on these contractual commitments, refer to Note 16 – Commitments and Contingencies to our financial statements included in Part II, Item 8 of this Annual Report on Form 10-K.

Critical Accounting Policies and Estimates

Management’s discussion and analysis of our financial condition and results of operations is based on our financial statements, which have been prepared in accordance with GAAP. In preparing the financial statements, we apply accounting policies and estimates that affect the reported amounts and related disclosures. Inherent in such policies are certain key assumptions and estimates made by management, which we believe best reflect the underlying business and economic events. Our estimates are based on historical experience and various other factors and assumptions that we believe are reasonable under the circumstances. We regularly re-evaluate our estimates used in the preparation of the financial statements based on our latest assessment of the current and projected business and economic environment. By their nature, these estimates and judgments are subject to an inherent degree of uncertainty and may involve reliance on complex IT systems. Actual results could differ materially from the amounts reported based on these estimates.

Our significant accounting policies are described in Note 2 - Basis of Presentation and Summary of Significant Accounting Policies to our financial statements included in Part II, Item 8 of this Annual Report on Form 10-K, and of these, management believes the following accounting policies involve a greater degree of judgment and complexity and are therefore the most critical in determining the amounts reported in our financial statements.

Revenue Recognition

We recognize revenue in accordance with ASC 606, Revenue from Contracts with Customers. Revenue is recognized when, or as, control of the promised goods or services is transferred to the customer, in an amount that represents the consideration the Company expects to be entitled to in exchange for those goods or services. As multiple parties are often involved in our revenue transactions, including clients and retailers, judgment is required in determining whether we are the principal or agent. We are the principal and present revenue on a gross basis if we control the goods or services before they are transferred to the end customer, or we are the agent and present revenue on a net basis if we arrange for other parties to provide the goods or services to the end customer.

Redemption revenue

The Company's clients promote their products and services to consumers through rewards offered on the IPN. Consumers redeem offers to earn a reward through account linking or receipt upload on D2C properties or through integrations with third-party publisher properties. The reward is funded by the client and passed through to the consumer. We earn a fee per redemption in the period in which the redemption occurs. The Company may also charge fees to set up a redemption campaign, which are deferred and recognized over the average duration of historical redemption campaigns. We recognize revenues from redemptions net of rewards as we believe we act as the agent in the transaction.

We also contract with third-party gift card providers to facilitate the delivery of digital gift cards and recognize revenue gross of reward but net of the cost of the gift card, at a point in time when the exchange occurs.

Ad & other revenue

Our clients may also run advertisements (banners, tiles, newsletters, feature placements, etc.) on D2C properties to promote their redemption campaigns. When a consumer clicks on an advertisement, they are linked directly to the associated campaign. Ad product revenue is recognized as the marketing services are performed. Ad products often run in conjunction with an associated redemption campaign, either over the entire redemption campaign life or some portion of it. We recognize revenue from client run advertisements on a gross basis as we believe we act as the principal in the transaction.

We also offer data licensing and audience targeting services. Data revenue is recognized as it is delivered and on a gross basis as we believe we act as the principal in the transaction.

Stock-Based Compensation

Stock-based compensation for equity awards, including stock options, restricted stock units (RSUs), and awards granted under our employee stock purchase plan (ESPP), is measured based on the grant date fair value of the award. For awards with service conditions only, we recognize compensation expense, net of actual forfeitures, on a straight-line basis over the requisite service period, which is generally four years. For awards with both service and performance conditions, we recognize compensation expense, net of actual forfeitures, under the accelerated attribution method when performance conditions are considered probable of being achieved.

The fair value of RSUs with only service or performance conditions is equal to the fair value of the underlying common stock at the date of grant. For RSUs with market-based conditions, we determine the grant date fair value utilizing a Monte Carlo simulation, which incorporates the probability of achievement of the market-based condition. The fair value of stock options and ESPP awards is estimated on the grant date using the Black-Scholes option-pricing model. Our use of the valuation models requires the input of subjective assumptions. The assumptions used in our valuation models represent management’s best estimates, which involve inherent uncertainties and the application of management’s judgment.

These assumptions and estimates are as follows:

•Expected Dividend Rate. The expected dividend assumption is based on our history and expectation of dividend payouts. We have not paid dividends and do not expect to do so in the foreseeable future, and as such, the dividend yield has been estimated to be zero.

•Expected Volatility. The expected volatility is determined with reference to historical stock volatilities of comparable guideline public companies and our own common stock over a period equivalent to the expected term of the award, as we lack sufficient trading history to rely solely on our own common stock.

•Expected Term. The expected term is the period of time for which the award is expected to be outstanding, assuming that it vests. We estimate the expected term for stock options using the simplified method, calculated as the midpoint between the requisite service period and the contractual term of the award. The simplified approach is applied as we do not have sufficient historical information to develop reasonable expectations about future exercise patterns and post-vesting employment termination behavior. For ESPP awards, the expected term is the time period from the grant date to the respective purchase dates included within each offering period.

•Risk-Free Interest Rate. The risk-free rate is determined based on the U.S. Treasury Yield Curve with respect to the stock options' expected term.

•Fair Value of Common Stock. Prior to the IPO, as our common stock was not yet publicly traded, we engaged a valuation specialist to estimate the fair value of our common stock. Subsequent to the IPO, the fair value of our common stock is based on the closing price of our Class A common stock.

We will continue to use judgment in evaluating the assumptions related to our stock-based compensation on a prospective basis. As we continue to accumulate additional data related to our common stock, we may have refinements to our estimates, which could materially impact our future stock-based compensation expense.

Income Taxes

The Company accounts for income taxes using the asset and liability method, under which, deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial statement carrying amounts and the tax basis of assets and liabilities and net operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. We recognize deferred tax assets to the extent that these assets are more likely than not to be realized. In making such a determination, we consider all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and our results of operations.

We recognize the tax effects of an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such positions are then measured based on the largest benefit that has a greater than 50% likelihood of being realized. Due to uncertainties in any tax audit outcome, our estimates of the ultimate settlement of our unrecognized tax positions may change and the actual tax benefits may differ significantly from the estimates.

Although we believe our assumptions, judgments, and estimates are reasonable, changes in tax laws, our interpretation of tax laws, the resolution of any tax audits, and differences between estimated and actual taxable income could significantly impact the amounts provided for income taxes in our financial statements.

Recent Accounting Pronouncements

See Note 2 – Basis of Presentation and Summary of Significant Accounting Policies in the notes to our financial statements included elsewhere in this Annual Report on Form 10-K for more information.