Yext, Inc.
For the period ended Jan 31, 2026. Filed Mar 10, 2026.
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A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2026 · Filed Mar 10, 2026
YEXT$7.57-1.0%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2025-01-31; filed 2025-03-13.
0001614178-25-000030
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2026-01-31; filed 2026-03-10.
0001628280-26-016402
Item 7. 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 142 previous paragraphs and 152 current paragraphs.
80 unchanged; 39 reworded; 28 added; 21 removed; 2 previous and 5 current paragraphs rearranged.
Tables are not compared: 14 previous and 16 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 (28)
Current report
On February 10, 2026, we commenced an issuer self-tender offer (the “Tender Offer”) to purchase for cash up to $180.0 million in value of shares of our common stock at a price of not less than $5.75 nor greater than $6.50 per share, upon the terms and subject to the conditions described in the offer to purchase and the related letter of transmittal filed with the SEC on February 10, 2026, as each may be amended time to time. The Tender Offer was originally scheduled to expire on March 12, 2026, unless the offer was extended or terminated. On March 4, 2026, we decreased the maximum aggregate purchase price of shares to be repurchased in the Tender Offer to $140.0 million and extended the expiration date to March 18, 2026, unless further extended or earlier terminated.
Current report
On August 18, 2025, we announced that Michael Walrath, Yext's Chief Executive Officer and Chairman on the Board of Directors, submitted a non-binding proposal to acquire all outstanding shares of Yext not already owned by him at a price of $9.00 per share in cash. Our Board of Directors formed a Special Committee of independent directors to evaluate the proposal, advised by independent legal and financial advisers. On February 2, 2026, we announced that Michael Walrath, our Chief Executive Officer and Chairman of the Board of Directors, had withdrawn his previously announced non-binding proposal.
Current report
On May 15, 2025, we entered into a credit agreement with funds and accounts managed by BlackRock as lenders, and Acquiom Agency Services LLC, as Administrative Agent (the “May 2025 Credit Agreement”), which provides for term loan facilities in aggregate principal amounts of up to $200.0 million. In connection with entry into the May 2025 Credit Agreement, we borrowed $100.0 million on May 15, 2025 and used a portion of the proceeds under the May 2025 Credit Agreement to pay all outstanding principal, interest and other amounts owing under our existing credit facility with Silicon Valley Bank, which was then terminated. On March 6, 2026, we borrowed an additional $50.0 million, which we intend to use in connection with the Tender Offer. See Note 12 "Debt" to our consolidated financial statements for additional information.
Current report
The following table presents our ARR for customers with less than $50,000 of ARR and customers with ARR of $50,000 or more for the periods presented:
Current report
Change in ARR Presentation
Current report
Beginning in the fourth quarter of fiscal 2026 and as reflected in the immediately preceding table, we refined our presentation of ARR to show ARR for customers with ARR of less than $50,000 and for customers with ARR of $50,000 or more. This view of ARR better aligns with management's internal assessment of ARR and assists in the allocation of resources to better serve customers that more meaningfully impact our business. Prior to the fourth quarter of fiscal 2026, we presented ARR for Direct customers and Third-party Reseller customers as set forth below.
Current report
Beginning in the fourth quarter of fiscal 2026 and as reflected in the immediately preceding table, our dollar-based net retention rate is presented for customers with ARR of less than $50,000 and customers with ARR of $50,000 or more to align with the presentation change in ARR discussed above. We believe this view of our dollar-based net retention rate better aligns with the way we evaluate and manage our business. Prior to the fourth quarter of fiscal 2026, we presented our dollar-based net retention rate based on Direct customers and Third-party Reseller customers, as set forth below.
Current report
The following table presents our dollar-based net retention rate for the periods presented based on our historical presentation, which we do not expect to refer to regularly in the future:
Current report
Dollar-Based Gross Retention Rate
Current report
We also evaluate our ability to retain customers and the ARR they generate for us over time, excluding the impact of expansion. We assess our performance in this area using a metric we refer to as dollar-based gross retention rate. We believe this metric provides insight into the stability of our customer base and our ability to deliver sustained value to customers independent of growth through expansion.
Current report
Beginning in the fourth quarter of fiscal 2026 and as reflected in the immediately preceding table, our dollar-based gross retention rate is presented for customers with ARR of less than $50,000 and customers with ARR of $50,000 or more to align with the presentation change in ARR discussed above. We believe this view of our dollar-based gross retention rate better aligns with the way we evaluate and manage our business. Prior to the fourth quarter of fiscal 2026, we presented our dollar-based gross retention rate based on Direct customers and Third-party Reseller customers, as set forth below.
Current report
The following table presents our dollar-based gross retention rate for the periods presented based on our historical presentation, which we do not expect to refer to regularly in the future:
Current report
Research and development expense was $89.9 million for the fiscal year ended January 31, 2026, compared to $77.2 million for the fiscal year ended January 31, 2025, an increase of $12.7 million, or 16%. The increase was primarily driven by employee-related costs, as personnel-related costs increased $2.5 million reflecting higher headcount, and stock-based compensation expense increased $3.6 million, largely due to awards granted in connection with the acquisition of Places Scout. In addition, software expense increased $1.0 million, and asset impairment charges of $2.1 million were recognized in connection with subleasing activity related to our corporate headquarters.
Current report
General and administrative expense was $63.3 million for the fiscal year ended January 31, 2026, compared to $105.1 million for the fiscal year ended January 31, 2025, a decrease of $41.7 million or 40%. The decrease was primarily driven by the acquisition of Hearsay on August 1, 2024, which resulted in $8.8 million of costs associated with the incentive pool being incurred during the fiscal year ended January 31, 2025, as well as changes in the fair value of contingent consideration of $34.1 million. See Note 6 "Fair Value of Financial Instruments" to our consolidated financial statements for additional information on contingent consideration. In addition, professional related costs decreased $2.3 million largely due to acquisition-related costs in connection with the Hearsay acquisition on August 1, 2024, which were primarily incurred in the fiscal year ended January 31, 2025. These decreases were offset by $2.1 million of payroll tax contingencies for a non-recurring state payroll withholding tax audit expected to be settled in the first half of fiscal 2027, a $1.7 million increase in stock-based compensation expense, largely due to awards granted to certain executives including performance-based RSUs, and impairment charges of $1.7 million that were recognized in connection with subleasing activity related to our corporate headquarters.
Current report
Net Income (Loss)
Current report
Net income was $37.9 million for the fiscal year ended January 31, 2026, compared to a net loss of $27.9 million for the fiscal year ended January 31, 2025.
Current report
During the fiscal year ended January 31, 2026, we revised our definitions of Non-GAAP net income (loss) and Adjusted EBITDA to include adjustments for asset impairment charges associated with subleasing floors of our corporate offices, as well as strategic transaction costs related to third-party costs incurred for Michael Walrath’s, Yext’s Chief Executive Officer and Chairman on the Board of Directors, non-binding proposal to acquire all outstanding shares, and payroll tax contingencies related to a non-recurring state payroll withholding tax audit. We believe these changes provide investors with a view of continuing core operations without the effects of these items, which may vary for reasons unrelated to overall operating performance.
Current report
Silicon Valley Bank
Current report
On May 15, 2025, in connection with the May 2025 Credit Agreement entered into with BlackRock, the Credit Facility with SVB was terminated and was accounted for as a debt extinguishment. No amounts were drawn under the facility at the time of termination, and all remaining unamortized issuance costs were written off, which were immaterial.
Current report
BlackRock
Current report
On May 15, 2025, we entered into the May 2025 Credit Agreement which provides for (i) a senior secured initial term loan facility (the “Initial Term Loan Facility”) in an aggregate principal amount of up to $100.0 million, (ii) a secured delayed draw term loan facility in an aggregate principal amount of up to $50.0 million (the “Delayed Draw Term Loan Facility”), and (iii) an uncommitted secured discretionary delayed draw term loan facility in an aggregate principal amount of up to $50.0 million (the “Discretionary Delayed Draw Term Loan Facility”, and together with the Initial Term Loan Facility and the Delayed Draw Term Loan Facility, the “Term Loan Facilities” and borrowings under the Term Loan Facilities, the “Term Loans”). The Term Loan Facilities mature on May 15, 2030. We borrowed $100.0 million under the Initial Term Loan Facility on May 15, 2025, and we borrowed $50.0 million under the Delayed Draw Term Loan Facility on March 6, 2026. The proceeds of the term loans made under the Initial Term Loan Facility were used to repay existing debt and related fees and expenses associated with Term Loan Facilities, with the remainder available for general corporate purposes, and we intend to use the proceeds of the term loans made under the Delayed Draw Term Loan Facility in connection with the Tender Offer.
Current report
The Term Loan Facilities bear interest, at our option, at an annual rate based on an adjusted term SOFR rate or a base rate. Term Loans based on the adjusted term SOFR rate shall bear interest at a per annum rate equal to term SOFR (subject to a 1.00% floor) plus 5.25%. Term Loans based on the base rate shall bear interest at a per annum rate equal to the greatest of (i) the prime rate then in effect, (ii) the federal funds effective rate then in effect, plus 0.50% per annum, (iii) an adjusted term SOFR rate determined on the basis of a one-month interest period, plus 1.00% per annum, and (iv) 2.00%, in each case, plus a margin of 4.25%. Interest is due and payable in quarterly arrears, in the case of Term Loans bearing interest at the base rate, and at the end of an interest period (or quarterly, in the case of any interest period longer than 3 months), in the case of Term Loans bearing interest at the adjusted term SOFR rate. As of January 31, 2026, interest on the Term Loan Facilities was based on an adjusted term SOFR rate.
Current report
The obligations under the May 2025 Credit Agreement are guaranteed by certain of our subsidiaries and secured by a lien on substantially all of our property and certain subsidiary guarantors.
Current report
The Term Loans are subject to certain mandatory prepayment events, including an excess cash flow sweep of up to 30% for excess cash flow periods in which our annualized recurring revenue is less than $350.0 million.
Current report
In connection with the May 2025 Credit Agreement, we incurred original issue discount costs of $1.0 million and debt issuance costs of $0.8 million. These costs will be amortized to interest expense over the term of the Term Loan Facilities using the effective interest method.
Current report
Tender Offer
Current report
On February 10, 2026, we announced the commencement of the Tender Offer to purchase for cash up to $180.0 million in value of shares of our common stock at a price of not less than $5.75 nor greater than $6.50 per share, to the seller in cash, less any applicable withholdings and without interest, upon the terms and subject to the conditions described in the offer to purchase and the related letter of transmittal, as each may be amended time to time. The Tender Offer was originally scheduled to expire on March 12, 2026. On March 4, 2026, we decreased the maximum aggregate purchase price of shares to be repurchased in the Tender Offer to $140.0 million and extended the expiration date to March 18, 2026, unless further extended or earlier terminated.
Current report
Contingent consideration arrangements entered in connection with a business combination are measured at fair value on the acquisition date and in subsequent reporting periods. Changes in in fair value associated with these arrangements are recorded in our consolidated statements of operations and comprehensive income (loss). These arrangements require management to make significant estimates and judgments that include, but are not limited to the future estimated achievement of earnout milestones, estimated timing of payments, and discount rates. These estimates are subject to changes in events and circumstances that arise over the duration of the arrangements.
Removed paragraphs (21)
Previous report
On June 4, 2024, we committed to a restructuring plan in response to evolving business needs to reduce operating expenses and position Yext for profitable future growth (the “Plan”). The Plan reduced the size of our workforce by approximately 12 percent of our full-time employees as compared to our headcount as of January 31, 2024. We incurred approximately $5 million in costs in connection with the Plan during our second quarter of fiscal year 2025, consisting primarily of severance payments, payments in lieu of notice, employee benefits and related costs.
Previous report
Following approval by our Board of Directors, on June 10, 2024, we entered into an Agreement and Plan of Merger (the “Merger Agreement”) for the acquisition of Hearsay Social, Inc. (“Hearsay”). Pursuant to the Merger Agreement, Hearsay became a wholly owned subsidiary of Yext upon closing of the transaction on August 1, 2024. The acquisition of Hearsay is intended to produce an end-to-end digital presence platform, combining Yext’s cutting-edge digital presence management capabilities with Hearsay’s compliant engagement solutions across social media, websites, text, and voice. We acquired Hearsay for approximately $125 million in cash, as adjusted for customary adjustments set forth in the Merger Agreement and the assumption of Hearsay employee equity awards. We also offered participation rights to key employees and former founders of Hearsay in a bonus pool of $20 million that can be settled in cash or our common stock and shall be subject to 100% vesting on the first anniversary of closing, generally subject to continued employment. In addition, subject to the terms of the Merger Agreement, we may also be required to pay additional contingent consideration of up to $75 million to Hearsay based on the achievement of certain milestones (the “Earnout”). The Earnout shall be payable based on achievement of certain annual recurring revenue targets. The targets shall be measured at the end of the first and second anniversaries of closing. The Earnout may be settled in cash or our common stock at our election. See Note 4 "Business Combination" to our consolidated financial statements for additional information.
Previous report
(1) ARR as of January 31, 2025 is inclusive of Hearsay's results.
Previous report
Change in ARR Methodology
Previous report
From time to time, we may refine our methodology of calculating our key performance metrics to better reflect our business. For example, beginning in the fourth quarter of fiscal year 2025, we refined our ARR methodology to include usage to align with management’s internal assessment of customers. Prior to that quarter, we had excluded what we previously referred to as overage. While this change may introduce additional volatility, we believe it provides a more comprehensive view of ARR that better aligns with the way we evaluate and manage our business. The amounts presented in the immediately preceding table have been restated to reflect our ARR presented on this current definition for periods previously disclosed that did not include overage.
Previous report
To accompany the transition to this new presentation, the following table presents our ARR for the periods presented as calculated using our prior definition of ARR, which excluded usage:
Previous report
(1) ARR as of January 31, 2025 is inclusive of Hearsay's results.
Previous report
From time to time, we may refine our methodology of calculating our key performance metrics to better reflect our business. For example, beginning in the fourth quarter of fiscal year 2025, we refined our ARR calculation methodology to include usage. This update resulted in a corresponding change in our dollar-based net retention rate, which is based on ARR. While this change may introduce additional variability due to changes in customer usage, it provides a more comprehensive view of our dollar-based net retention rate. The amounts presented in the immediately preceding table have been restated to reflect our dollar-based net retention rate presented as measured on our current definition of ARR for periods previously disclosed that did not include overage.
Previous report
To accompany the transition to this new presentation, the following table presents our dollar-based net retention rate for the periods presented as calculated using our prior definition of ARR, which excluded usage:
Previous report
Customer Count
Previous report
Customer count is defined as the total number of customers with contracts executed as of the last day of the reporting period and a unique administrative account identifier on our platform. Generally, we assign unique administrative accounts to each separate and distinct entity (such as a company or government institution) or a business unit of a large corporation, that has its own separate contract with us to access our platform. Historically, we believed that customer count provided insight into our ability to grow our enterprise and mid-size customer base. As such, customer count excluded third-party reseller customers and small business customers as well as customers only receiving free trials. From time to time, some customers previously characterized as small business customers transitioned to mid-size customers, and customer count included these changes resulting from any recharacterization.
Previous report
We no longer consider customer count to be a key performance measure of our business. As such, we are presenting customer count as of the end of January 31, 2025 as a key metric, but we do not expect to refer to it regularly in the future. As of January 31, 2025, customer count was approximately 2,920.
Previous report
Research and development expense was $77.2 million for the fiscal year ended January 31, 2025, compared to $72.0 million for the fiscal year ended January 31, 2024, an increase of $5.2 million, or 7%. The increase was primarily driven by a $7.6 million increase in personnel-related costs, reflecting higher headcount. This increase was offset by decreases in stock-based compensation expense of $1.1 million, depreciation expense of $0.6 million, as certain assets have fully depreciated, and a $0.5 million decrease in professional related costs, among others.
Previous report
General and administrative expense was $105.1 million for the fiscal year ended January 31, 2025, compared to $72.2 million for the fiscal year ended January 31, 2024, an increase of $32.9 million or 46%. The increase was primarily driven by the acquisition of Hearsay, which resulted in $8.8 million of costs being incurred related to the portion of the incentive pool payable to founders and early employees, as well as $5.5 million related to changes in the fair value of contingent consideration. The increase was further driven by employee-related costs, as stock-based compensation expense increased $7.5 million, mainly due to PSUs granted in fiscal year 2024, and personnel-related costs increased $3.1 million, largely due to retention amounts related to Hearsay employees. In addition, professional related costs increased $7.3 million, primarily due to professional services related to the Hearsay acquisition.
Previous report
Net Loss
Previous report
Net loss was $27.9 million and $2.6 million for the fiscal years ended January 31, 2025 and 2024, respectively.
Previous report
Beginning with the three months ended July 31, 2024, we revised our definitions of Non-GAAP net income (loss) and Adjusted EBITDA to adjust for the effects of certain acquisition-related costs prompted by our recent acquisition of Hearsay. We believe these changes provide investors with a view of continuing core operations without the effects of unusual activity specific to acquisition-related accounting. These adjustments do not omit or adjust for the inclusion of ongoing operations of acquisitions.
Previous report
As amended, the revolving loans bear interest, at our election, at an annual rate based on SOFR or a base rate. Loans based on SOFR shall bear interest at a rate between SOFR plus 1.75% and SOFR plus 2.25%, depending on our consolidated total leverage ratio and subject to a SOFR floor of 1.00%. Loans based on the base rate shall bear interest at a rate between the base rate minus 1.25% and the base rate minus 0.75%, depending on our consolidated total leverage ratio. We are also obligated to pay a commitment fee on the unused portion of the facility at a rate of 0.25% per annum.
Previous report
The obligations under the Credit Facility are secured by a lien on substantially all of our tangible and intangible property and by a pledge of all of our equity interests of material direct and indirect domestic subsidiaries and 66% of each class of capital stock of any material first-tier foreign subsidiaries, subject to limited exceptions.
Previous report
In March 2025, the Board of Directors authorized an additional $50.0 million to the share repurchase program.
Previous report
Net cash used in investing activities of $2.7 million for the fiscal year ended January 31, 2024 reflected capital expenditures.
Reworded paragraphs (39)
Previous wording
Yext empowers businesses to manage their knowledge so they can deliver relevant, actionable answers to consumer questions as well as consistent, accurate and engaging experiences to customers throughout the digital ecosystem. Our digital presence platform (also known as the Answers Platform) lets businesses structure and organize information about their brands in our knowledge graph, Yext Content (also known as the Knowledge Graph), which is then delivered across first-and third-party websites and applications through our network of over 200 service and application providers, which we refer to as our Publisher Network. These publishers include, among others, Amazon Alexa, Apple, Bing, Facebook, Google, and Yelp. Our platform powers all of our key products, including Listings, Reviews, Pages and Search, each with robust analytics capabilities for businesses to easily track performance across customer experiences. It is our mission to empower businesses to easily manage every aspect of their digital presence to make meaningful connections with their customers across every digital touchpoint.
Current wording
Yext empowers businesses to manage their knowledge so they can deliver relevant, actionable answers to consumer questions as well as consistent, accurate and engaging experiences to customers throughout the digital ecosystem. Our digital presence platform (also known as the Answers Platform) lets businesses structure and organize information about their brands in our Knowledge Graph (previously known as Yext Content), which is then delivered across first-and third-party websites and applications through our network of over 200 service and application providers, which we refer to as our Publisher Network. These publishers include, among others, Amazon Alexa, Apple, Bing, Facebook, Gemini, Google, OpenAI, and Yelp. Our platform powers all of our key products, including Listings, Reviews, Pages, Search, Social, Relate, and Scout, each with robust analytics capabilities for businesses to easily track performance across customer experiences. It is our mission to empower businesses to easily manage every aspect of their digital presence to make meaningful connections with their customers across every digital touchpoint.
Previous wording
In August 2024, we acquired Hearsay Social, Inc., a digital client engagement platform for financial services ("Hearsay"). See Note 4 "Business Combination" to our consolidated financial statements for additional information.
Current wording
In August 2024, we acquired Hearsay Social, Inc., a digital client engagement platform for financial services ("Hearsay"). See Note 4 "Business Combinations" to our consolidated financial statements for additional information.
Previous wording
Our results of operations have been and may continue to be influenced by general macroeconomic conditions, including, but not limited to, the impact of foreign currency fluctuations, interest rates, inflation, recession risks, and geopolitical events and shifts. Fluctuations in foreign exchange rates and rising inflation have had, and may continue to have an adverse impact on our financial condition and operating results in future periods. The extent to which such disruptions will continue in future periods remains uncertain, which has had and may continue to have an adverse impact on our financial condition and operating results in future periods. We continue to be committed to our business, the strength of our platform, our ability to continue to execute on our strategy, and our efforts to support our customers.
Current wording
Our results of operations have been and may continue to be influenced by general macroeconomic conditions, including, but not limited to, the impact of foreign currency fluctuations, interest rates, inflation, recession risks, tariffs and other trade restrictions, geopolitical events and shifts, and changes in government administration policy positions. Fluctuations in foreign exchange rates and rising inflation have had, and may continue to have an adverse impact on our financial condition and operating results in future periods. The extent to which such disruptions will continue in future periods remains uncertain, which has had and may continue to have an adverse impact on our financial condition and operating results in future periods. We continue to be committed to our business, the strength of our platform, our ability to continue to execute on our strategy, and our efforts to support our customers.
Previous wording
On February 7, 2025, we completed an acquisition of KabanaSoft, LLC, doing business as Places Scout (“Places Scout”), for a purchase price of $20.3 million in cash, subject to customary adjustments as set forth in the Unit Purchase Agreement. The acquisition strengthens Yext’s ability to provide best-in-class competitive intelligence, benchmarking, and AI-powered insights. In addition, subject to the terms of the Unit Purchase Agreement, we agreed to grant approximately $10.0 million of incentive equity, based on current trading prices of Yext’s common stock, to certain key employees of Places Scout.
Current wording
On February 7, 2025, we completed an acquisition of KabanaSoft, LLC, doing business as Places Scout (“Places Scout”), for a purchase price of $20.3 million in cash, subject to customary adjustments. The acquisition strengthens Yext’s ability to provide best-in-class competitive intelligence, benchmarking, and AI-powered insights. In addition, subject to the terms of the Unit Purchase Agreement, we agreed to grant approximately $10.0 million of incentive equity, based on current trading prices of Yext’s common stock, to certain key employees of Places Scout.
Previous wording
See Part I Item 1A “Risk Factors” for further discussion of the possible impact of the current macroeconomic conditions on our business.
Current wording
See Part I Item 1A “Risk Factors” for further discussion of the possible impact of the current macroeconomic conditions and recent developments on our business.
Previous wording
Total ARR is defined as the annualized recurring amount of all contracts executed as of the last day of the reporting period. The recurring amount of a contract is determined based upon the terms of a contract and is calculated by dividing the amount of a contract by the term of the contract and then annualizing such amount. The calculation assumes no subsequent changes to the existing subscription, and where relevant, includes the annualized contractual minimum commitment and amounts related to usage above the contractual minimum commitment. Contracts include portions of professional services contracts that are recurring in nature.
Current wording
ARR is defined as the annualized recurring amount of all contracts executed as of the last day of the reporting period. The recurring amount of a contract is determined based upon the terms of a contract and is calculated by dividing the amount of a contract by the term of the contract and then annualizing such amount. The calculation assumes no subsequent changes to the existing subscription, and where relevant, includes the annualized contractual minimum commitment and amounts related to usage above the contractual minimum commitment. We calculate usage by annualizing monthly amounts in excess of contractual minimum commitments in the current month. Contracts include portions of professional services contracts that are recurring in nature.
Previous wording
ARR is independent of historical revenue, unearned revenue, remaining performance obligations or any other accounting principles generally accepted in the United States of America, ("GAAP"), financial measure over any period. It should be considered in addition to, not as a substitute for, nor superior to or in isolation from, these measures and other measures prepared in accordance with GAAP. We believe ARR-based metrics provides insight into the performance of our recurring revenue business model while mitigating fluctuations in billing and contract terms.
Current wording
ARR is independent of historical revenue, unearned revenue, remaining performance obligations or any other accounting principles generally accepted in the United States of America, ("GAAP"), financial measure over any period. It should be considered in addition to, not as a substitute for, nor superior to or in isolation from, these measures and other measures prepared in accordance with GAAP. We believe ARR-based metrics provide insight into the performance of our recurring revenue business model while mitigating fluctuations in billing and contract terms.
Previous wording
The following table provides our ARR for the periods presented:
Current wording
The following table presents our ARR for the periods presented based on our historical presentation, which we do not expect to refer to regularly in the future:
Previous wording
Annual recurring revenue, or ARR, for Direct customers is defined as the annualized recurring amount of all contracts in our enterprise, mid-size and small business customer base as of the last day of the reporting period. The recurring amount of a contract is determined based upon the terms of a contract and is calculated by dividing the amount of a contract by the term of the contract and then annualizing such amount. The calculation assumes no subsequent changes to the existing subscription. Contracts include portions of professional services contracts that are recurring in nature.
Current wording
ARR for Direct customers was defined as the annualized recurring amount of all contracts in our enterprise, mid-size and small business customer base as of the last day of the reporting period. The recurring amount of a contract was determined based upon the terms of a contract and was calculated by dividing the amount of a contract by the term of the contract and then annualizing such amount. The calculation assumed no subsequent changes to the existing subscription. Contracts included portions of professional services contracts that are recurring in nature.
Previous wording
ARR for Third-party Reseller customers is defined as the annualized recurring amount of all contracts with Third-party Reseller customers as of the last day of the reporting period. The recurring amount of a contract is determined based upon the terms of a contract and is calculated by dividing the amount of a contract by the term of the contract and then annualizing such amount. The calculation assumes no subsequent changes to the existing subscription. The calculation includes the annualized contractual minimum commitment and amounts related to usage above the contractual minimum commitment. Contracts include portions of professional services contracts that are recurring in nature. See Part I Item 1A “Risk Factors" for further discussion of Third-party reseller customers.
Current wording
ARR for Third-party Reseller customers was defined as the annualized recurring amount of all contracts with Third-party Reseller customers as of the last day of the reporting period. The recurring amount of a contract was determined based upon the terms of a contract and was calculated by dividing the amount of a contract by the term of the contract and then annualizing such amount. The calculation assumed no subsequent changes to the existing subscription. The calculation included the annualized contractual minimum commitment and amounts related to usage above the contractual minimum commitment. We calculated usage by annualizing monthly amounts in excess of contractual minimum commitments in the current month. Contracts included portions of professional services contracts that are recurring in nature.
Previous wording
This metric is calculated first by determining the ARR generated 12 months prior to the end of the current period for a cohort of customers who had active contracts at that time. We then calculate ARR from the same cohort of customers at the end of the current period, which includes customer expansion, contraction and churn. The current period ARR is then divided by the prior period ARR to arrive at our dollar-based net retention rate. Any ARR obtained through merger and acquisition transactions does not affect the dollar-based net retention rate until one year from the date on which the transaction closed. The cohorts of customers that we present dollar-based net retention rate for include direct, third-party reseller, and total customers. Direct customers include enterprise, mid-size and small business customers.
Current wording
This metric is calculated first by determining the ARR generated 12 months prior to the end of the current period for a cohort of customers who had active contracts at that time. We then calculate ARR from the same cohort of customers at the end of the current period, which includes customer expansion, contraction and churn. The current period ARR is then divided by the prior period ARR to arrive at our dollar-based net retention rate. Any ARR obtained through merger and acquisition transactions does not affect the dollar-based net retention rate until one year from the date on which the transaction closed. The cohorts of customers that we present dollar-based net retention rate for include customers with ARR of less than $50,000, customers with ARR of $50,000 or more, and total customers. The cohort designation is based on the designation as of the 12 months prior to the end of the current period and does not reflect changes in cohort designation that may occur through the current period.
Previous wording
Change in Dollar-Based Net Retention Rate Methodology
Current wording
Change in Dollar-Based Net Retention Rate Presentation
Previous wording
Cost of revenue consists primarily of employee-related costs, including personnel-related costs, which mainly consist of salaries and wages, and stock-based compensation expense. Cost of revenue also includes fees associated with our Publisher Network application provider arrangements, the nature of which may be unpaid, fixed, or variable, and are unpaid with many of our larger providers, as well as the costs associated with our data centers. In addition, cost of revenue includes depreciation expense, which includes amounts allocated based on employee headcount, as well as amounts related to certain capitalized software development costs incurred in connection with additional functionality to our platform. Cost of revenue also includes amortization expense, which includes amounts related to intangible assets arising from acquisitions and lease expenses associated with our office spaces, which are allocated based on employee headcount. In addition, cost of revenue includes software expense, which relates to licenses, professional services, and other costs associated with software for use in the operations of our business, which is also allocated based on employee headcount.
Current wording
Cost of revenue consists primarily of employee-related costs, including personnel-related costs, which mainly consist of salaries and wages, and stock-based compensation expense. Cost of revenue also includes fees associated with our Publisher Network application provider arrangements, the nature of which may be unpaid, fixed, or variable, and are unpaid with many of our larger providers, as well as the costs associated with our data centers. In addition, cost of revenue includes depreciation expense, which includes amounts allocated based on employee headcount, as well as amounts related to certain capitalized software development costs incurred in connection with additional functionality to our platform. Cost of revenue also includes amortization expense, which includes amounts related to intangible assets arising from acquisitions, as well as lease expenses and asset impairments associated with our office spaces, which are allocated based on employee headcount. In addition, cost of revenue includes professional related costs and software expense, which relates to licenses, professional services, and other costs associated with software for use in the operations of our business, which is also allocated based on employee headcount.
Previous wording
Sales and marketing expenses. Sales and marketing expenses consist primarily of employee-related costs which are comprised of personnel-related costs and stock-based compensation expense. Personnel-related costs mainly consist of salaries and wages and costs of obtaining revenue contracts. Sales and marketing expenses also include lease expenses associated with our office spaces, as well as software expense, each of which are allocated based on employee headcount. In addition, sales and marketing expenses include amortization expense, which includes amounts related to intangible assets arising from acquisitions, as well as costs related to advertising and conferences and brand awareness events.
Current wording
Sales and marketing expenses. Sales and marketing expenses consist primarily of employee-related costs which are comprised of personnel-related costs and stock-based compensation expense. Personnel-related costs mainly consist of salaries and wages and costs of obtaining revenue contracts. Sales and marketing expenses also include lease expenses and asset impairments associated with our office spaces, as well as software expense, each of which are allocated based on employee headcount. In addition, sales and marketing expenses include amortization expense, which includes amounts related to intangible assets arising from acquisitions, as well as costs related to advertising and conferences and brand awareness events.
Previous wording
Research and development expenses. Research and development expenses consist primarily of employee-related costs which are comprised of personnel-related costs and stock-based compensation expense. Personnel-related costs mainly consist of salaries and wages. Capitalized software development costs related to additional functionality to our platform are excluded from research and development expenses as they are capitalized as a component of property and equipment, net and depreciated to cost of revenue over the term of their useful life. Research and development expenses also include data centers costs associated with pre-production costs for testing and quality assurance, as well as lease expenses associated with our office spaces, and software expense, each of which are allocated based on employee headcount.
Current wording
Research and development expenses. Research and development expenses consist primarily of employee-related costs which are comprised of personnel-related costs and stock-based compensation expense. Personnel-related costs mainly consist of salaries and wages. Capitalized software development costs related to additional functionality to our platform are excluded from research and development expenses as they are capitalized as a component of property and equipment, net and depreciated to cost of revenue over the term of their useful life. Research and development expenses also include data centers costs associated with pre-production costs for testing and quality assurance, as well as lease expenses and asset impairments associated with our office spaces, and software expense, each of which are allocated based on employee headcount.
Previous wording
General and administrative expenses. General and administrative expenses consist primarily of employee-related costs which are comprised of personnel-related costs and stock-based compensation expense for our finance and accounting, human resources, information technology and legal support departments. Personnel-related costs mainly consist of salaries and wages. General and administrative expenses also include lease expenses associated with our office spaces, as well as software expense, each of which are allocated based on employee headcount. In addition, general and administrative expenses include other professional related costs, which include acquisition-related costs, as well as fair value adjustments related to contingent consideration.
Current wording
General and administrative expenses. General and administrative expenses consist primarily of employee-related costs which are comprised of personnel-related costs and stock-based compensation expense for our finance and accounting, human resources, information technology and legal support departments. Personnel-related costs mainly consist of salaries and wages. General and administrative expenses also include lease expenses and asset impairments associated with our office spaces, as well as software expense, each of which are allocated based on employee headcount. In addition, general and administrative expenses include bad debt expense and other professional related costs, which include acquisition-related costs, as well as fair value adjustments related to contingent consideration.
Previous wording
(1)See Note 10 "Stock-Based Compensation" to the consolidated financial statements for amounts included.
Current wording
(1)See Note 10 "Stock-Based Compensation" to our consolidated financial statements for amounts included.
Previous wording
Total revenue was $421.0 million for the fiscal year ended January 31, 2025, compared to $404.3 million for the fiscal year ended January 31, 2024, an increase of $16.6 million or 4%. The increase was entirely driven by the inclusion of Hearsay’s revenue as a result of the acquisition which did not exist in the comparative period. The increase was negatively affected by the resulting absence of revenue from the attrition of a large customer that did not renew their contract as of January 31, 2024. Revenue recognized from subscriptions and associated support to our platform was 93% and 92%, while revenue recognized from professional services was 7% and 8%, for the fiscal years ended January 31, 2025 and 2024, respectively.
Current wording
Total revenue was $446.6 million for the fiscal year ended January 31, 2026, compared to $421.0 million for the fiscal year ended January 31, 2025, an increase of $25.6 million or 6%. The increase was entirely driven by the inclusion of Hearsay’s revenue as a result of the acquisition which was completed on August 1, 2024. Revenue recognized from subscriptions and associated support to our platform was 94% and 93%, while revenue recognized from professional services was 6% and 7%, for the fiscal years ended January 31, 2026 and 2025, respectively.
Previous wording
Revenue for the fiscal year ended January 31, 2025 included a positive impact from foreign currency exchange rates of approximately $1.5 million, using a constant currency basis. We calculate constant currency by translating our current period results for entities reporting in currencies other than U.S. Dollars (“USD”) into USD at the average monthly exchange rates in effect during the comparative period, as opposed to the average monthly exchange rates in effect during the current period.
Current wording
Revenue for the fiscal year ended January 31, 2026 included a positive impact from foreign currency exchange rates of approximately $3.3 million, using a constant currency basis. We calculate constant currency by translating our current period results for entities reporting in currencies other than U.S. Dollars (“USD”) into USD at the average monthly exchange rates in effect during the comparative period, as opposed to the average monthly exchange rates in effect during the current period.
Previous wording
Revenue attributable to direct customers was $347.0 million for the fiscal year ended January 31, 2025, compared to $327.1 million for the fiscal year ended January 31, 2024, an increase of $19.9 million or 6%.The increase was entirely driven by the inclusion of Hearsay’s revenue as a result of the acquisition which did not exist in the comparative period. The increase was negatively affected by the resulting absence of revenue from the attrition of a large customer that did not renew their contract as of January 31, 2024. Revenue attributable to third-party reseller customers was $74.0 million for the fiscal year ended January 31, 2025, compared to $77.2 million for the fiscal year ended January 31, 2024, a decrease of $3.2 million or 4% primarily due to customer attrition.
Current wording
Revenue attributable to direct customers was $372.5 million for the fiscal year ended January 31, 2026, compared to $347.0 million for the fiscal year ended January 31, 2025, an increase of $25.5 million or 7%. The increase was entirely driven by the inclusion of Hearsay’s revenue as a result of the acquisition which was completed on August 1, 2024. Revenue attributable to third-party reseller customers was $74.1 million for the fiscal year ended January 31, 2026, compared to $74.0 million for the fiscal year ended January 31, 2025, remaining relatively consistent. As we no longer regularly evaluate or assess performance by sales channel, the above disaggregation of revenue is not expected to be referred to on a consistent basis in the future.
Previous wording
Cost of revenue was $96.4 million for the fiscal year ended January 31, 2025, compared to $87.5 million for the fiscal year ended January 31, 2024, an increase of $8.9 million, or 10%. The increase was primarily driven by the acquisition of Hearsay, which resulted in a $4.0 million increase in amortization expense related to acquired intangible assets, as well as a $1.3 million increase related to royalties and integration fees. In addition, data center costs increased $2.4 million, and professional related costs increased $1.6 million. These increases were offset by a $2.0 million decrease in depreciation expense, as certain assets have fully depreciated.
Current wording
Cost of revenue was $114.1 million for the fiscal year ended January 31, 2026, compared to $96.4 million for the fiscal year ended January 31, 2025, an increase of $17.7 million, or 18%. The increase was primarily driven by a $5.5 million increase in amortization expense related to acquired intangible assets largely related to the acquisition of Hearsay, as well as a $1.2 million increase related to royalties and integration fees. In addition, personnel-related costs increased $3.6 million reflecting higher headcount, data center costs increased $2.7 million, and asset impairment charges of $2.5 million were recognized in connection with subleasing activity related to our corporate headquarters.
Previous wording
Gross margin was 77.1% for the fiscal year ended January 31, 2025, compared to 78.4% for the fiscal year ended January 31, 2024 as reflected in the discussion above.
Current wording
Gross margin was 74.5% for the fiscal year ended January 31, 2026, compared to 77.1% for the fiscal year ended January 31, 2025 as reflected in the discussion above.
Previous wording
Sales and marketing expense was $174.8 million for the fiscal year ended January 31, 2025, compared to $178.8 million for the fiscal year ended January 31, 2024, a decrease of $4.1 million, or 2%. The decrease was primarily driven by a $1.9 million decrease in personnel-related costs, reflecting lower headcount, a $1.4 million decrease in depreciation expense as certain assets have fully depreciated, a $1.3 million decrease in employee travel and a $1.2 million decrease in lease expense. In addition, there were smaller decreases in conferences and events of $0.6 million and software expense of $0.5 million. These decreases were offset by a $3.1 million increase in amortization expense related to acquired intangible assets from the Hearsay acquisition.
Current wording
Sales and marketing expense was $134.8 million for the fiscal year ended January 31, 2026, compared to $174.8 million for the fiscal year ended January 31, 2025, a decrease of $40.0 million, or 23%. The decrease was primarily driven by employee-related costs, as personnel-related costs decreased $26.4 million and stock-based compensation expense decreased $8.2 million, reflecting lower headcount. In addition, advertising costs decreased $2.8 million and conferences and events decreased $2.4 million. These decreases were offset by a $3.7 million increase in amortization expense largely related to acquired intangible assets from the Hearsay acquisition, and asset impairment charges of $2.3 million recognized in connection with subleasing activity related to our corporate headquarters.
Previous wording
Non-GAAP net income (loss) is a financial measure that is not calculated in accordance with GAAP. We define non-GAAP net income (loss) as our GAAP net income (loss) as adjusted to exclude the effects of stock-based compensation expense, acquisition-related costs, amortization of acquired intangibles, and the related income tax effect of these adjustments. Acquisition-related costs include transaction and related costs, subsequent fair value movements in contingent consideration, and compensation arrangements. We believe non-GAAP net income (loss) provides investors and other users of our financial information consistency and comparability with our past financial performance and facilitates period-to-period comparisons of our results of operations. We also believe non-GAAP net income (loss) is useful in evaluating our operating performance compared to that of other companies in our industry, as it eliminates the effects of stock-based compensation, acquisition-related costs, and amortization of acquired intangibles, which may vary for reasons unrelated to overall operating performance.
Current wording
Non-GAAP net income (loss) is a financial measure that is not calculated in accordance with GAAP. We define non-GAAP net income (loss) as our GAAP net income (loss) as adjusted to exclude the effects of stock-based compensation expense, acquisition-related costs, amortization of acquired intangibles, asset impairments, strategic transaction costs, and payroll tax contingencies, as well as the related income tax effect of these adjustments. Acquisition-related costs include transaction and related costs, subsequent fair value movements in contingent consideration, and compensation arrangements. Strategic transaction costs relate to third-party costs incurred in connection with Michael Walrath’s, Yext’s Chief Executive Officer and Chairman on the Board of Directors, non-binding proposal to acquire all outstanding shares. Payroll tax contingencies are related to a state payroll withholding tax audit expected to be settled in the first half of fiscal 2027 that are not expected to recur. We believe non-GAAP net income (loss) provides investors and other users of our financial information consistency and comparability with our past financial performance and facilitates period-to-period comparisons of our results of operations. We also believe non-GAAP net income (loss) is useful in evaluating our operating performance compared to that of other companies in our industry, as it eliminates the effects of stock-based compensation, acquisition-related costs, amortization of acquired intangibles, asset impairments, strategic transaction costs, and payroll tax contingencies, which may vary for reasons unrelated to overall operating performance.
Previous wording
In addition, beginning in fiscal 2025, we are utilizing a projected tax rate of 25% in our computation of the non-GAAP income tax provision. Our estimated tax rate on non-GAAP income is determined annually and may be adjusted during the year to take into account events or trends that we believe materially impact the estimated annual rate including, but not limited to, significant changes resulting from tax legislation, material changes in the geographic mix of revenue and expenses and other significant events. Our estimated tax rate on non-GAAP income may differ from our GAAP tax rate and from our actual tax liabilities.
Current wording
Beginning in fiscal year 2026, we utilized a projected tax rate of 23.5% in our computation of the non-GAAP income tax provision which was subsequently updated to 25.5% in the second quarter of fiscal 2026. This compares to a projected tax rate of 25% in fiscal year 2025. Our estimated tax rate on non-GAAP income is determined annually and may be adjusted during the year to take into account events or trends that we believe materially impact the estimated annual rate including, but not limited to, significant changes resulting from tax legislation, material changes in the geographic mix of revenue and expenses and other significant events. Our estimated tax rate on non-GAAP income may differ from our GAAP tax rate and from our actual tax liabilities.
Previous wording
Adjusted EBITDA is a non-GAAP financial measure that we believe offers a useful view of overall operations used to assess the performance of core business operations and for planning purposes. We define Adjusted EBITDA as GAAP net income (loss) before (1) interest income (expense), net, (2) (provision for) benefit from income taxes, (3) depreciation and amortization, (4) other income (expense), net, (5) stock-based compensation expense, and (6) acquisition-related costs. The most directly comparable GAAP financial measure to Adjusted EBITDA is GAAP net income (loss). Users should consider the limitations of using Adjusted EBITDA, including the fact that this measure does not provide a complete measure of our operating performance. Adjusted EBITDA is not intended to purport to be an alternate to GAAP net income (loss) as a measure of operating performance.
Current wording
Adjusted EBITDA is a non-GAAP financial measure that we believe offers a useful view of overall operations used to assess the performance of core business operations and for planning purposes. We define Adjusted EBITDA as GAAP net income (loss) before (1) interest income (expense), net, (2) (provision for) benefit from income taxes, (3) depreciation and amortization, (4) other income (expense), net, (5) stock-based compensation expense, (6) acquisition-related costs, (7) asset impairments, (8) strategic transaction costs and (9) payroll tax contingencies. The most directly comparable GAAP financial measure to Adjusted EBITDA is GAAP net income (loss). Users should consider the limitations of using Adjusted EBITDA, including the fact that this measure does not provide a complete measure of our operating performance. Adjusted EBITDA is not intended to purport to be an alternate to GAAP net income (loss) as a measure of operating performance.
Previous wording
Our non-GAAP financial measures may be limited in their usefulness because they do not present the full economic effect of the expenses mentioned above. We compensate for these limitations by providing a reconciliation of our non-GAAP financial measures to the most closely related GAAP financial measures. We encourage investors and others to review our financial information in its entirety, not to rely on any single financial measure and to view non-GAAP net income (loss) and Adjusted EBITDA in conjunction with GAAP net income (loss).
Current wording
Our non-GAAP financial measures may be limited in their usefulness because they do not present the full economic effect of the aforementioned items. We compensate for these limitations by providing a reconciliation of our non-GAAP financial measures to the most closely related GAAP financial measures. We encourage investors and others to review our financial information in its entirety, not to rely on any single financial measure and to view non-GAAP net income (loss) and Adjusted EBITDA in conjunction with GAAP net income (loss).
Previous wording
We have recast our results on the same basis for the prior comparative periods presented, although the effects in those periods remain unchanged notwithstanding as no such acquisition-related activity had occurred. The following table reconciles our GAAP net loss to non-GAAP net income (loss):
Current wording
We have recast our results on the same basis for the prior comparative periods presented, although the effects in those periods remain unchanged as no strategic transaction costs, asset impairments, or payroll tax contingencies occurred.
Previous wording
The following table reconciles our GAAP net loss to Adjusted EBITDA:
Current wording
The following table reconciles our GAAP net income (loss) to Adjusted EBITDA:
Previous wording
The following table provides a reconciliation of GAAP Cash flow provided by (used in) operating activities to free cash flow:
Current wording
The following table provides a reconciliation of GAAP Cash flow provided by operating activities to free cash flow:
Previous wording
As of January 31, 2025, our principal sources of liquidity were cash and cash equivalents of $123.1 million. We believe our existing cash and cash equivalents will be sufficient to meet our projected operating requirements for at least the next 12 months. Our cash flows, including net cash used in or provided by operating activities, may vary significantly from quarter to quarter, due to the timing of billings, cash collections and lease payments, significant marketing events and related expenses, acquisitions, and other factors.
Current wording
As of January 31, 2026, our principal sources of liquidity were cash and cash equivalents of $154.1 million. We believe our existing cash and cash equivalents will be sufficient to meet our projected operating requirements for at least the next 12 months. Our cash flows, including net cash used in or provided by operating activities, may vary significantly from quarter to quarter, due to the timing of billings, cash collections and lease payments, significant marketing events and related expenses, acquisitions, and other factors.
Previous wording
The Credit Facility contains customary affirmative and negative covenants and restrictions, as well as financial covenants that require us to maintain minimum liquidity of $35.0 million at all times and a consolidated total leverage ratio of no greater than 3.00 to 1.00, tested on a quarterly basis.
Current wording
The May 2025 Credit Agreement contains customary affirmative and negative covenants and restrictions that, among other things, restrict our and our subsidiaries' ability to repurchase stock, incur additional debt, pay dividends and make distributions, make certain investments and acquisitions, prepay certain indebtedness, create liens, enter into agreements with affiliates, modify the nature of our business, enter into sale-leaseback transactions, transfer and sell material assets and merge or consolidate. The May 2025 Credit Agreement also contains financial covenants that require us to maintain minimum qualified cash of at least $35.0 million at all times and minimum consolidated EBITDA for relevant test periods, tested on a quarterly basis. The May 2025 Credit Agreement contains customary events of default relating to, among other things, payment defaults, breach of covenants, cross acceleration to material indebtedness, bankruptcy-related defaults, judgment defaults, and the occurrence of certain change of control events. Non-compliance with one or more of the covenants and restrictions or the occurrence of an event of default could result in the full or partial principal balance of the May 2025 Credit Agreement becoming immediately due and payable and termination of the commitments.
Previous wording
As of January 31, 2025, we were in compliance with all debt covenants. As of such date, the $50.0 million revolving loan facility had $36.6 million available and $13.4 million in letters of credit allocated as security in connection with office space.
Current wording
As of January 31, 2026, we were in compliance with all debt covenants.
Previous wording
In March 2022, our Board of Directors authorized a $100.0 million share repurchase program of our common stock. In September 2023, our Board of Directors authorized an additional $50.0 million to the share repurchase program. During the fiscal year ended January 31, 2025, 2,687,528 shares were purchased and as of January 31, 2025 approximately $31.9 million remains available for future purchases, exclusive of commissions paid on the repurchase of shares.
Current wording
In March 2022, our Board of Directors authorized a $100.0 million share repurchase program of our common stock which was increased by an additional $50.0 million in September 2023 and an additional $50.0 million in March 2025. During the fiscal year ended January 31, 2026, 9,417,849 shares were purchased and as of January 31, 2026, approximately $14.9 million remains available for future purchases, exclusive of commissions paid on the repurchase of shares.
Previous wording
Net cash provided by operating activities of $46.2 million for the fiscal year ended January 31, 2024 reflected our net loss of $2.6 million, adjusted by non-cash charges including stock-based compensation expense of $45.0 million, depreciation and amortization expense of $15.8 million and amortization of operating lease right-of-use assets of $8.8 million. In addition, there were positive adjustments resulting from changes in costs to obtain revenue contracts of $8.8 million, prepaid expenses and other current assets of $0.8 million and accounts receivable of $0.5 million, mainly due to timing of billing and cash collections during the period. These increases were offset by changes in operating lease liabilities of $11.7 million, unearned revenue of $11.3 million and accounts payable, accrued expenses and other current liabilities of $10.2 million.
Current wording
Net cash provided by operating activities of $55.8 million for the fiscal year ended January 31, 2026 reflected our net income of $37.9 million, adjusted by non-cash charges including stock-based compensation expense of $48.7 million, depreciation and amortization expense of $27.0 million, amortization of operating lease right-of-use assets of $9.4 million, asset impairment charges of $8.6 million, and bad debt expense of $3.1 million. These non-cash charges were offset by $28.6 million related to adjustments to contingent consideration. In addition, there were positive adjustments resulting from changes in other long term assets of $6.5 million, and costs to obtain revenue contracts of $3.0 million. These increases were offset by changes in unearned revenue of $15.7 million, operating lease liabilities of $14.3 million, other long term liabilities of $12.0 million, accounts receivable of $8.3 million, mainly due to timing of billing and cash collections during the period, prepaid expenses and other current assets of $5.2 million, and accounts payable, accrued expenses and other current liabilities of $4.9 million.
Previous wording
Net cash used in financing activities of $23.3 million for the fiscal year ended January 31, 2024 was primarily related to $23.1 million in cash outflows associated with repurchases of common stock as part of our share repurchase program, as well as payments for taxes related to the net share settlement of stock-based compensation awards of $13.0 million and payments of deferred financing costs of $0.5 million. This was offset by proceeds from exercise of stock options of $9.4 million and net proceeds from employee stock purchase plan withholdings of $3.9 million.
Current wording
Net cash used in financing activities of $9.5 million for the fiscal year ended January 31, 2026 reflected cash outflows of $67.4 million associated with repurchases of common stock as part of our share repurchase program, as well as $23.0 million associated with payments for taxes related to the net share settlement of stock-based compensation awards, and deferred acquisition payments of $22.0 million made in connection with the Hearsay acquisition. This was offset by proceeds from debt issuance of $99.0 million related to the May 2025 Credit Agreement and $2.9 million of net proceeds from employee stock purchase plan withholdings.
Previous wording
See Note 15 "Commitments and Contingencies" to the consolidated financial statements for our discussion on contractual obligations.
Current wording
See Note 15 "Commitments and Contingencies" to our consolidated financial statements for further discussion on contractual obligations.
Previous wording
We account for income taxes in accordance with ASC Topic 740, “Income Taxes,” under which deferred income taxes are provided for temporary differences between the financial reporting and tax basis of our assets and liabilities. We classify all deferred tax assets and liabilities as non-current on the consolidated balance sheet. The effect of a change in tax rates on deferred tax assets and liabilities is recognized within the provision for income taxes on the consolidated statement of operations and comprehensive loss in the period that includes the enactment date.
Current wording
We account for income taxes in accordance with ASC Topic 740, “Income Taxes,” under which deferred income taxes are provided for temporary differences between the financial reporting and tax basis of our assets and liabilities. We classify all deferred tax assets and liabilities as non-current on the consolidated balance sheet. The effect of a change in tax rates on deferred tax assets and liabilities is recognized within the provision for income taxes on the consolidated statements of operations and comprehensive income (loss) in the period that includes the enactment date.
Previous wording
We recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by taxing authorities, based on the technical merits of the position. We recognize interest and penalties related to uncertain tax positions within the provision for income taxes on our consolidated statement of operations and comprehensive loss.
Current wording
We recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by taxing authorities, based on the technical merits of the position. We recognize interest and penalties related to uncertain tax positions within the provision for income taxes on our consolidated statement of operations and comprehensive income (loss).
Rearranged current paragraphs (5)
Current report — wording carried from elsewhere
This metric is calculated by first determining the ARR generated 12 months prior to the end of the current period for a cohort of customers who had active contracts at that time. We then calculate ARR from the same cohort of customers at the end of the current period, which includes customer contraction and churn, and excludes customer expansion. The current period ARR is then divided by the prior period ARR to arrive at our dollar-based gross retention rate. The cohort of customers that we present dollar-based gross retention rate for include customers with ARR of less than $50,000, customers with ARR of $50,000 or more, and total customers. The cohort designation is based on the designation as of the 12 months prior to the end of the current period and does not reflect changes in cohort designation that may occur through the current period.
Current report — wording carried from elsewhere
The following table provides our dollar-based gross retention rate for the periods presented:
Current report — wording carried from elsewhere
Change in Dollar-Based Net Retention Rate Presentation
Current report — wording carried from elsewhere
The following table reconciles our GAAP net income (loss) to non-GAAP net income (loss):
Current report — wording carried from elsewhere
Net cash used in investing activities of $21.4 million for the fiscal year ended January 31, 2026 reflected cash outflows of $18.8 million related to cash paid, net of cash acquired, in the acquisition of Places Scout, as well as capital expenditures of $2.6 million.
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
We calculate usage by annualizing monthly amounts in excess of contractual minimum commitments in the current month.
Previous report — wording carried elsewhere
(1) Beginning in fiscal 2025, we are utilizing a projected tax rate of 25% in our computation of the non-GAAP income tax provision. Our estimated tax rate on non-GAAP income is determined annually and may be adjusted during the year to take into account events or trends that we believe materially impact the estimated annual rate including, but not limited to, significant changes resulting from tax legislation, material changes in the geographic mix of revenue and expenses and other significant events. Our estimated tax rate on non-GAAP income may differ from our GAAP tax rate and from our actual tax liabilities.