DOMO, INC.
For the period ended Apr 30, 2026. Filed Jun 15, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Apr 30, 2026 · Filed Jun 15, 2026
HUCK$2.75-4.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-10-31; filed 2025-12-09.
0001628280-25-055921
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-04-30; filed 2026-06-15.
0001628280-26-043173
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 129 previous paragraphs and 120 current paragraphs.
77 unchanged; 33 reworded; 10 added; 17 removed; 2 previous and 0 current paragraphs rearranged.
Tables are not compared: 15 previous and 11 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 (10)
Current report
Operating Expenses
Current report
Total Other Expense, Net
Current report
(3)Includes executive officer severance as follows:
Current report
Operating Expenses
Current report
General and administrative expenses decreased due in part to an $0.4 million decrease in travel expense and a $0.3 million decrease in income tax expense. General and administrative expenses as a percent of revenue changed from 17% in the three months ended April 30, 2025 to 18% in the three months ended April 30, 2026. We expect general and administrative expense as a percentage of revenue to decrease in the long term.
Current report
Total Other Expense, Net
Current report
Remeasurement of warrant liability resulted in a $2.1 million gain during the three months ended April 30, 2026, a favorable change of $0.9 million.
Current report
As of April 30, 2026, we were not in compliance with the minimum annualized recurring revenue covenant under our credit facility. As a result, the lenders have the right to accelerate repayment of the $136.6 million of principal and related fees, and we have classified the related term loan and fees as a current liability as of April 30, 2026. Our cash and cash equivalents of $39.1 million as of April 30, 2026 would not be sufficient to repay the term loan upon any such acceleration. As a result, substantial doubt exists about our ability to continue as a going concern.
Current report
In connection with the covenant noncompliance described above, the Company entered into a forbearance agreement with its lenders, under which the lenders agreed to forbear from exercising their rights and remedies with respect to the noncompliance and certain other specified and anticipated defaults during a limited forbearance period, subject to certain conditions. The forbearance does not waive the underlying default and does not change the classification of the term loan, which remains a current liability, and upon its expiration the lenders may exercise their rights and remedies, including acceleration. See Note 11, "Debt," for further details.
Current report
The forbearance period is contingent on the Company's pursuit and completion of a potential transaction, including the Company's entry into a definitive purchase agreement by July 31, 2026 and the completion of a transaction no later than November 30, 2026. The Company is in advanced negotiations regarding a potential transaction. While substantial progress has been made, no definitive agreement has been executed and there can be no assurance that any transaction will result from these discussions. If negotiations continue to progress successfully, the Company anticipates that a potential transaction could be announced in the near term. Management's plans to mitigate the conditions described above are focused on completing this potential transaction. The Company also has access to an at-the-market equity offering program under which it may sell up to $150.0 million of its Class B common stock. The completion of a potential transaction, and the Company's ability to raise capital under the at-the-market program depend on factors outside the Company's control, including the actions of the Company's lenders, potential counterparties, and investors, as well as market conditions, and there can be no assurance that any of these plans will be entered into or completed on acceptable terms, or at all. Accordingly, management has concluded that these plans do not alleviate the substantial doubt about the Company's ability to continue as a going concern. See Note 1, "Liquidity and Going Concern," to our condensed consolidated financial statements. If we are unable to obtain sufficient liquidity, the lenders could accelerate our indebtedness and foreclose on our assets, and our business, financial condition and ability to continue operations would be materially and adversely affected.
Removed paragraphs (17)
Previous report
The increase in subscription cost of revenue was primarily due to a $0.7 million increase in amortization related to capitalized software development costs and a $0.4 million increase in our third-party web hosting services.
Previous report
The decrease in professional services and other cost of revenue was primarily due to a $0.5 million decrease in employee-related costs.
Previous report
General and administrative expenses increased primarily due to a $1.6 million increase in employee-related costs, driven by stock-based compensation. This was partially offset by a $1.4 million decrease in other general and administrative costs. Our general and administrative expenses increased as a percentage of revenue from 15% to 16%. We expect general and administrative expense as a percentage of revenue to decrease in the long term.
Previous report
Loss on extinguishment of debt decreased due to a $1.9 million loss on extinguishment during the prior year as a result of the August 2024 amendment to the credit facility.
Previous report
Remeasurement of warrant liability increased due to a revaluation of warrant liability, which resulted in a $2.2 million net change during the three months ended October 31, 2025.
Previous report
Income taxes remained relatively flat during the three months ended October 31, 2025 due to similar results of operations compared to the prior year quarter. In the long term, we expect income tax expense to increase in conjunction with higher taxable income from our international subsidiaries.
Previous report
Discussion of the Nine Months Ended October 31, 2024 and 2025
Previous report
Revenue
Previous report
The increase in cost of subscription revenue was primarily due to a $2.6 million increase in expense related to third-party web hosting services.
Previous report
Subscription gross margin decreased primarily due to a slight increase in revenue, offset by increased costs related to third-party web hosting services as a result of increased customer data usage. Professional services and other gross margin improved primarily due to a higher amount of revenue recognized from the delivery of custom apps and a decrease in outsourced services during the nine months ended October 31, 2025.
Previous report
Sales and marketing expenses decreased primarily due to a $7.2 million decrease in employee-related costs, driven by lower stock-based compensation and lower headcount.
Previous report
Research and development expenses decreased primarily due to a $6.8 million decrease in employee-related costs, driven by lower headcount and lower stock-based compensation.
Previous report
General and administrative expenses decreased primarily due to a $5.1 million decrease in professional and legal fees. This was partially driven by uncapitalized costs related to the amendment to the credit facility that occurred during the nine months ended October 31, 2024. This was partially offset by a $0.6 million increase in bad debt expense, driven by a reversal of bad debt expense during the nine months ended October 31, 2024.
Previous report
Loss on extinguishment of debt decreased due to a $1.9 million loss on extinguishment during the prior year as a result of the August 2024 amendment to the credit facility.
Previous report
Remeasurement of warrant liability increased due to a revaluation of warrant liability, which resulted in a $7.5 million net change during the nine months ended October 31, 2025.
Previous report
We believe our existing cash and cash equivalents will be sufficient to meet our projected operating requirements for at least the next 12 months. Over the longer term, we plan to continue investing in, among other things, growth opportunities, product development, and sales and marketing. If available funds are insufficient to fund our future activities or execute on our strategy, we may raise additional capital through equity, equity-linked and debt financing, to the extent such funding sources are available. Alternatively, we may be required to reduce expenses to manage liquidity; however, any such reductions could adversely impact our business and competitive position. Our future capital requirements will depend on many factors, including our growth rate; the level of investments we make in product development, sales and marketing activities and other investments to support the growth of our business; the continuing market acceptance of our platform; and customer retention rates, and may increase materially from those currently planned. If we raise additional funds through the incurrence of indebtedness, such indebtedness likely would have rights that are senior to holders of our equity securities and could contain covenants that restrict operations in the same or similar manner as our credit facility. Any additional equity financing likely would be dilutive to existing stockholders. We cannot assure you that any additional financing will be available to us on acceptable terms, or at all.
Previous report
Although we are not currently a party to any agreement or letter of intent with respect to potential investments in, or acquisitions of, complementary businesses, services or technologies, we may enter into these types of arrangements in the future, which could also require us to seek additional equity financing, incur indebtedness, or use cash resources. We have no present understandings, commitments or agreements to enter into any such acquisitions. We do not have any special purpose entities and we do not engage in off-balance sheet financing arrangements.
Reworded paragraphs (33)
Previous wording
Business leaders, department heads and managers are the typical initial subscribers to our platform, deploying Domo to solve a business problem or to enable departmental access. Over time, as customers recognize the value of our platform, we engage with CIOs and other executives to facilitate broad enterprise adoption.
Current wording
Business leaders, department heads and managers are typically initial subscribers to our platform, deploying Domo to solve a business problem or enable departmental access. Over time, as customers recognize the value of our platform, we engage with CIOs and other executives to facilitate broader adoption.
Previous wording
We primarily offer our platform as a consumption-based service, which includes consumption-based agreements and enterprise-wide agreements (ELAs) with unlimited users and a data cap. Customers with consumption-based agreements have an annual purchase commitment based on an estimated volume of usage, utilizing a tiered pricing structure, which is paid upfront. We believe a consumption-based service offering helps increase customer adoption and allows us to better land, expand, and retain customers over the long term, and thereby have a positive impact on sales and marketing productivity. We also believe this offering has potential to remove many of the barriers of adoption and better align our pricing to the value delivered to our customers. Historically, we have offered our platform to our customers as a subscription-based service. Subscription fees are based upon the chosen Domo package which includes tier-based platform capabilities or usage. As of the end of our most recent fiscal quarter, 80% of our annual recurring revenue (ARR) was utilizing the platform as a consumption-based service, and we expect this percentage to increase in future periods.
Current wording
We primarily offer our platform, which customers can adopt in whole or in part, as a consumption-based service, which includes consumption-based agreements and enterprise-wide agreements (ELAs) with unlimited users and a data cap. Customers with consumption-based agreements have an annual purchase commitment based on estimated usage, utilizing a tiered pricing structure, which is paid upfront. Historically, we also offered subscription-based agreements, under which subscription fees are based upon the chosen Domo package which includes tier-based platform capabilities or usage. As of the end of our most recent fiscal quarter, 89% of our annual recurring revenue (ARR) was utilizing the platform as a consumption-based service, and we expect this percentage to increase in future periods.
Previous wording
As of October 31, 2025, 74% of our customers were under multi-year contracts on a dollar-weighted basis, compared to 69% of customers as of January 31, 2025. The high percentage revenue from multi-year contracts, among both new and existing customers, has enhanced the predictability of our subscription revenue, which includes both subscription-based and consumption-based agreements. We typically invoice our customers annually in advance for subscriptions to our platform.
Current wording
As of April 30, 2026, 76% of our customers were under multi-year contracts on a dollar-weighted basis, consistent with 76% of customers as of January 31, 2026. The high percentage revenue from multi-year contracts, among both new and existing customers, has enhanced the predictability of our subscription revenue, which includes both subscription-based and consumption-based agreements. We typically invoice our customers annually in advance for subscriptions to our platform.
Previous wording
Remaining performance obligations (RPO) represents the remaining amount of revenue we expect to recognize from existing non-cancelable contracts, whether billed or unbilled. As of October 31, 2024 and 2025, total RPO was $368.2 million and $428.6 million, respectively. The amount of RPO expected to be recognized as revenue in the next twelve months was $220.6 million and $231.1 million as of October 31, 2024 and 2025, respectively.
Current wording
Remaining performance obligations (RPO) represents the remaining amount of revenue we expect to recognize from existing non-cancelable contracts, whether billed or unbilled. As of April 30, 2025 and 2026, total RPO was $427.5 million and $437.3 million, respectively. The amount of RPO expected to be recognized as revenue in the next twelve months was $241.0 million and $239.6 million as of April 30, 2025 and 2026, respectively.
Previous wording
We had total revenue of $79.8 million and $79.4 million for the three months ended October 31, 2024 and 2025, respectively. For the nine months ended October 31, 2024 and 2025, we had total revenue of $238.3 million and $239.2 million, respectively. For the nine months ended October 31, 2024 and 2025, no single customer accounted for more than 10% of our total revenue, nor did any single organization when accounting for multiple subsidiaries or divisions which may have been invoiced separately. Revenue from customers with billing addresses in the United States comprised 79% and 79% or our total revenue for the three months ended October 31, 2024 and 2025, respectively.
Current wording
We had total revenue of $80.1 million and $79.4 million for the three months ended April 30, 2025 and 2026, respectively. For the three months ended April 30, 2025 and 2026, no single customer accounted for more than 10% of our total revenue, nor did any single organization when accounting for multiple subsidiaries or divisions which may have been invoiced separately. Revenue from customers with billing addresses in the United States comprised 80% and 79% of our total revenue for the three months ended April 30, 2025 and 2026, respectively.
Previous wording
We have incurred significant net losses since our inception, including net losses of $18.8 million and $10.4 million for the three months ended October 31, 2024 and 2025, respectively, and had an accumulated deficit of $1,538.9 million at October 31, 2025. We expect to incur losses for the foreseeable future and may not be able to achieve or sustain profitability.
Current wording
We have incurred significant net losses since our inception, including net losses of $18.1 million and $14.2 million for the three months ended April 30, 2025 and 2026, respectively, and had an accumulated deficit of $1,561.1 million at April 30, 2026. We expect to incur losses for the foreseeable future and may not be able to achieve or sustain profitability.
Previous wording
Prevailing macroeconomic conditions have elongated the software sales cycle, increased deal scrutiny and made renewal discussions more challenging. These conditions may continue to impact our business and those of our customers in a manner that we may not be able to quantify or isolate from other drivers of our performance, and may negatively impact our revenue growth in the near term. Ongoing concerns about the health of the U.S. and global economies may cause certain of our current and potential customers to reduce or delay technology spending or seek payment or other concessions from us. These conditions, along with the ongoing uncertainty in the SaaS sector, may materially and negatively impact our operating results, financial condition and prospects. In response to these dynamics, we have taken and intend to continue to take steps to better align our sales team and focus on controlling costs, which we expect will result in improved margins, sustained positive cash flow and efficient growth in the long term.
Current wording
Prevailing macroeconomic conditions have elongated the software sales cycle, increased deal scrutiny and made renewal discussions more challenging. These conditions may continue to impact our business and those of our customers in a manner that we may not be able to quantify or isolate from other drivers of our performance, and may negatively impact our revenue growth in the near term. Ongoing concerns about the health of the U.S. and global economies may cause certain of our current and potential customers to reduce or delay technology spending or seek payment or other concessions from us. These conditions, along with the ongoing uncertainty in the SaaS sector, may materially and negatively impact our operating results, financial condition and prospects. In response to these dynamics, we have taken and intend to continue to take steps to better align our sales team and focus on controlling costs, which we expect will result in improved margins and efficient growth in the long term. However, as described below under "Liquidity and Capital Resources," conditions exist that raise substantial doubt about our ability to continue as a going concern, and there can be no assurance that these steps will result in sustained positive cash flow.
Previous wording
As of October 31, 2025, we had over 2,400 customers. Enterprise customers accounted for 46% and 44% of our revenue for both the three and nine months ended October 31, 2024 and 2025, respectively. To drive growth among both our enterprise and corporate customers, we intend to further develop our partner ecosystem by establishing agreements with more software resellers, systems integrators and other partners to provide broader customer and geographic coverage. We believe we are underpenetrated in the overall market and have significant opportunity to expand our customer base over time.
Current wording
As of April 30, 2026, we had over 2,400 customers. Enterprise customers accounted for 45% and 44% of our revenue for the three months ended April 30, 2025 and 2026, respectively. To drive growth among both our enterprise and corporate customers, we intend to further develop our partner ecosystem by establishing agreements with more software resellers, systems integrators and other partners to provide broader customer and geographic coverage. We believe we are underpenetrated in the overall market and have significant opportunity to expand our customer base over time.
Previous wording
An important metric that we use to evaluate our performance in retaining customers is gross retention rate. We calculate our gross retention rate by taking the dollar amount of annual contract value (ACV) that renews in a given period divided by the ACV that was up for renewal in that same period. The ACV of multi-year contracts is also considered in the calculation based on the period in which the annual anniversary of the contract falls. Our trailing twelve month gross retention rate was 84% and 84% as of October 31, 2024 and 2025, respectively. Our gross retention has been affected in part due to macroeconomic conditions and challenging renewals from customers with COVID-19 use cases of our platform. As we continue to expand our partner ecosystem and develop methods to encourage wider and more strategic adoptions, we expect that customer retention will increase over the long term.
Current wording
An important metric that we use to evaluate our performance in retaining customers is gross retention rate. We calculate our gross retention rate by taking the dollar amount of annual contract value (ACV) that renews in a given period divided by the ACV that was up for renewal in that same period. The ACV of multi-year contracts is also considered in the calculation based on the period in which the annual anniversary of the contract falls. Our trailing twelve month gross retention rate was 85% and 86% as of April 30, 2025 and 2026, respectively. Our gross retention has been affected in part due to macroeconomic conditions and challenging renewals from customers with COVID-19 use cases of our platform. As we continue to expand our partner ecosystem and develop methods to encourage wider and more strategic adoptions, we expect that customer retention will increase over the long term.
Previous wording
Sales and marketing expense as a percentage of total revenue was 47% for the three months ended October 31, 2024 compared to 43% for the three months ended October 31, 2025.
Current wording
Sales and marketing expense as a percentage of total revenue was 50% for the three months ended April 30, 2025 compared to 47% for the three months ended April 30, 2026.
Previous wording
We plan to continue to make investments in areas of our business to continue to expand our platform functionality. This may include investing in machine learning algorithms, predictive analytics, and other artificial intelligence technologies to create alerts, detect anomalies, optimize queries, and suggest areas of interest to help people focus on what matters most. These investments may also include extending the functionality and effectiveness of our platform through improvements to the Domo Appstore and developer toolkits, which enable customers and partners to quickly build and deploy custom applications. The amount of new investments as a percentage of revenue required to achieve our plans is expected to increase slightly in the near term then remain consistent in the long term.
Current wording
We plan to continue to make investments in areas of our business to continue to expand our platform functionality. This may include investing in machine learning algorithms, predictive analytics, and other artificial intelligence technologies to create alerts, detect anomalies, optimize queries, and suggest areas of interest to help people focus on what matters most. These investments may also include extending the functionality and effectiveness of our platform through improvements to the Domo Appstore and developer toolkits, which enable customers and partners to quickly build and deploy custom data applications. The amount of new investments as a percentage of revenue required to achieve our plans is expected to increase slightly in the near term then remain consistent in the long term.
Previous wording
Research and development expense as a percentage of total revenue was 27% for the three months ended October 31, 2024 compared to 24% for the three months ended October 31, 2025.
Current wording
Research and development expense as a percentage of total revenue was 25% for the three months ended April 30, 2025 compared to 23% for the three months ended April 30, 2026.
Previous wording
The following table sets forth our billings for the three and nine months ended October 31, 2024 and 2025:
Current wording
The following table sets forth our billings for the three months ended April 30, 2025 and 2026:
Previous wording
Total other expense, net consists of loss on extinguishment of debt, remeasurement of warrant liability, and other expense, net. Other expense, net consists primarily of interest expense related to long-term debt. It also includes the effect of exchange rates on foreign currency transaction gains and losses, foreign currency gains and losses upon remeasurement of intercompany balances, and interest income. The transactional impacts of foreign currency are recorded as foreign currency losses (gains) in the consolidated statements of operations.
Current wording
Total other expense, net consists of remeasurement of warrant liability and other expense, net. Other expense, net consists primarily of interest expense related to long-term debt. It also includes the effect of exchange rates on foreign currency transaction gains and losses, foreign currency gains and losses upon remeasurement of intercompany balances, and interest income. The transactional impacts of foreign currency are recorded as foreign currency losses (gains) in the consolidated statements of operations.
Previous wording
(2)Includes amortization of certain intangible assets of $0.1 million and $0.1 million for the three months ended October 31, 2024 and 2025, respectively, and $0.4 million and $0.4 million for the nine months ended October 31, 2024 and 2025, respectively.
Current wording
(2)Includes amortization of certain intangible assets of $0.1 million for each of the three months ended April 30, 2025 and 2026.
Previous wording
The increase in subscription revenue was primarily due to a $10.6 million increase from new customers, partially offset by a $8.7 million net decrease from existing customers. Our total customer count decreased from October 31, 2024 to October 31, 2025. For the purposes of this comparison, new customers are defined as those added since the end of the prior year quarter, and revenue from existing customers is presented net of churn. The decrease in professional services and other revenue was primarily due to the delivery of certain other contracts recognized in the prior year quarter.
Current wording
The decrease in subscription revenue was primarily due to a $2.6 million increase from new customers, partially offset by a $4.2 million net decrease from existing customers. Our total customer count decreased 6% from April 30, 2025 to April 30, 2026. For the purposes of this comparison, new customers are defined as those added since the end of the prior year quarter, and revenue from existing customers is presented net of churn. The increase in professional services and other revenue was primarily due to a $0.7 million increase in event sponsorships and minor increases in other revenue.
Previous wording
Cost of professional services and other revenue decreased primarily due to a $1.9 million decrease in outsourced services and a $0.5 million increase in employee-related costs.
Current wording
The increase in cost of professional services and other revenue is primarily due to a $1.1 million increase in employee-related costs, partially offset by a $0.8 million decrease in outsourced services.
Previous wording
Subscription gross margin decreased primarily due to a slight increase in revenue, offset by increased costs related to third-party web hosting services as a result of increased customer data usage. As we continue to shift more of our customer base to consumption-based pricing, we expect subscription gross margin to remain relatively stable in the near term and increase in the long term.
Current wording
Subscription gross margin decreased slightly primarily due to a decrease in subscription revenue. As we continue to shift more of our customer base to consumption-based pricing, we expect subscription gross margin to remain relatively stable in the near term and increase in the long term.
Previous wording
Services gross margin declined primarily due to the delivery of certain other high-margin contracts recognized in the prior year quarter. We expect the gross margin for professional services to fluctuate from period to period due to changes in the proportion of services provided by third-party consultants, seasonality, and timing of projects with differing margins.
Current wording
Services gross margin increased primarily due to a favorable mix of higher margin projects delivered during the current period and a decrease in outsourced services. We expect the gross margin for professional services to fluctuate from period to period due to changes in the proportion of services provided by third-party consultants, seasonality, and timing of projects with differing margins.
Previous wording
Sales and marketing expenses decreased primarily due to a $1.9 million decrease in employee-related costs, driven by stock-based compensation and lower headcount. Commissions expense decreased by $0.6 million and marketing expense decreased by $0.5 million. Our sales and marketing expense as a percentage of revenue decreased from 47% to 43%. We expect sales and marketing expense as a percentage of revenue to be relatively stable in the near term and decrease in the long term.
Current wording
The decrease in sales and marketing expenses was primarily due to a $5.2 million decrease in commission expense, partially offset by a $3.5 million increase in employee-related costs. These offsets are partially driven by certain fiscal 2026 commissions paid out the form of fully vested restricted stock units (RSUs) instead of cash. Sales and marketing expense as a percentage of total revenue decreased from 50% in the three months ended April 30, 2025 to 47% in the three months ended April 30, 2026. We expect sales and marketing expense as a percentage of revenue to be relatively stable in the near term and decrease in the long term.
Previous wording
Research and development expenses decreased primarily due to a $2.5 million decrease in employee-related costs, driven by lower headcount. This was partially offset by a $0.3 million increase in software costs. Our research and development costs decreased as a percentage of revenue from 27% to 24%. We expect research and development expense as a percentage of revenue to decrease in the long term.
Current wording
Research and development expenses decreased primarily due to a $2.0 million decrease in employee-related costs, driven by stock-based compensation. This was partially offset by a $0.7 million decrease in capitalized software, which increases expense. Research and development expense as a percentage of revenue decreased from 25% in the three months ended April 30, 2025 to 23% in the three months ended April 30, 2026. We expect research and development expense as a percentage of revenue to decrease in the long term.
Previous wording
Other expense, net increased primarily due to an increase in expense related to changes in foreign exchange rates.
Current wording
Other expense, net increased primarily due to minor increases in interest expense and expense related to changes in foreign exchange rates and higher balances of cash denominated in currencies other than the functional currency and minor decreases to interest income.
Previous wording
Income taxes increased primarily due to higher taxable income from our international subsidiaries during the nine months ended October 31, 2025.
Current wording
Income taxes increased primarily due to higher taxable income from our international subsidiaries during the three months ended April 30, 2026.
Previous wording
As of October 31, 2025, we had $47.9 million of cash and cash equivalents, which were held for working capital purposes. Our cash and cash equivalents consist primarily of cash and money market funds. We have a $125.3 million credit facility, all of which had been drawn as of October 31, 2025.
Current wording
As of April 30, 2026, we had $39.1 million of cash and cash equivalents, which were held for working capital purposes. Our cash and cash equivalents consist primarily of cash and money market funds. We have a $125.3 million credit facility, all of which had been drawn as of April 30, 2026.
Previous wording
The credit facility requires interest-only payments on a portion of the accrued interest until the maturity date. This payable portion of the interest that accrues on the outstanding principal of the term loan is due in cash on a monthly basis, which, as of October 31, 2025, accrued at a floating rate equal to the greater of (1) 8.0% and (2) Adjusted Term SOFR. Adjusted Term SOFR is defined as the greater of (a) 2.5% and (b) Term SOFR. In the event that SOFR is unavailable, interest will accrue at a floating rate equal to the greater of (1) 7.0% and (2) the Alternate Base Rate plus 2.75% per year. The Alternate Base Rate is defined as the greatest of (a) the Prime Rate (b) Federal Funds Effective Rate plus 0.5% and (c) Adjusted Term SOFR plus 1.00%. The Federal Funds Effective rate is defined as the rate published by the Federal Reserve System as the overnight rate, or, if such rate is not so published, the average of the quotations for the day for such transaction received by Administrative Agent from three Federal funds brokers. As of October 31, 2025, the cash interest rate was approximately 7.2%. In addition to the 7.2% cash interest rate, a fixed rate equal to 5.0% per year accrues on the outstanding principal of the term loan. This capitalized portion of the interest is added to the principal amount of the outstanding term loan on a monthly basis and is due upon maturity.
Current wording
The credit facility requires interest-only payments on a portion of the accrued interest until the maturity date. This payable portion of the interest that accrues on the outstanding principal of the term loan is due in cash on a monthly basis, which, as of April 30, 2026, accrued at a floating rate equal to the greater of (1) 8.0% and (2) Adjusted Term SOFR. Adjusted Term SOFR is defined as the greater of (a) 2.5% and (b) Term SOFR. In the event that SOFR is unavailable, interest will accrue at a floating rate equal to the greater of (1) 7.0% and (2) the Alternate Base Rate plus 2.75% per year. The Alternate Base Rate is defined as the greatest of (a) the Prime Rate (b) Federal Funds Effective Rate plus 0.5% and (c) Adjusted Term SOFR plus 1.0%. The Federal Funds Effective rate is defined as the rate published by the Federal Reserve System as the overnight rate, or, if such rate is not so published, the average of the quotations for the day for such transaction received by Administrative Agent from three Federal funds brokers. As of April 30, 2026, the cash interest rate was approximately 6.7%. In addition to the 6.7% cash interest rate, a fixed rate equal to 5.0% per year accrues on the outstanding principal of the term loan. This capitalized portion of the interest is added to the principal amount of the outstanding term loan on a monthly basis and is due upon maturity.
Previous wording
The credit facility contains customary conditions to borrowing, events of default and covenants, including covenants that restrict our ability to dispose of assets, make material changes to the nature, control or location of the business, merge with or acquire other entities, incur indebtedness or encumbrances, make distributions to holders of our capital stock, make certain investments or enter into transactions with affiliates. In addition, we are required to comply with a minimum annualized recurring revenue covenant (as defined by the credit facility), tested quarterly. The credit facility defines annualized recurring revenue as four times our aggregate revenue for the immediately preceding quarter (net of recurring discounts and discounts for periods greater than one year) less the annual contract value of any customer contracts pursuant to which we were advised during such quarter would not be renewed at the end of the current term plus the annual contract value of existing customer contract increases during such quarter. We are also required to comply with a minimum trailing 12-month consolidated EBITDA covenant (as defined by the credit facility), which is tested quarterly, and adhere to a monthly minimum liquidity covenant (as defined by the credit facility) that requires unrestricted cash on a consolidated basis of $25.0 million deposited in pledged accounts located in the United States. Noncompliance with these covenants, or the occurrence of certain other events specified in the credit facility, could result in an event of default under the loan agreement. If an event of default has occurred and we are unable to obtain a waiver, any outstanding principal, interest and fees could become immediately due and payable. We were in compliance with the covenant terms of the credit facility on January 31, 2025 and October 31, 2025.
Current wording
The credit facility contains customary conditions to borrowing, events of default and covenants, including covenants that restrict our ability to dispose of assets, make material changes to the nature, control or location of the business, merge with or acquire other entities, incur indebtedness or encumbrances, make distributions to holders of our capital stock, make certain investments or enter into transactions with affiliates. In addition, we are required to comply with a minimum annualized recurring revenue covenant (as defined by the credit facility), tested quarterly. The credit facility defines annualized recurring revenue as four times our aggregate revenue for the immediately preceding quarter (net of recurring discounts and discounts for periods greater than one year) less the annual contract value of any customer contracts pursuant to which we were advised during such quarter would not be renewed at the end of the current term plus the annual contract value of existing customer contract increases during such quarter. We are also required to comply with a minimum trailing 12-month consolidated EBITDA covenant (as defined by the credit facility), which is tested quarterly, and adhere to a monthly minimum liquidity covenant (as defined by the credit facility) that requires unrestricted cash on a consolidated basis of $25.0 million deposited in pledged accounts located in the United States. Noncompliance with these covenants, or the occurrence of certain other events specified in the credit facility, constitutes an event of default under the loan agreement, upon which the lenders may declare any outstanding principal, interest and fees immediately due and payable. We were in compliance with the covenant terms of the credit facility on January 31, 2026. As of April 30, 2026, we were not in compliance with the minimum annualized recurring revenue covenant and we have not obtained a waiver. As a result, we have classified the outstanding term loan as a current liability as of April 30, 2026. See Note 1, "Liquidity and Going Concern," and Note 11, "Debt," to our condensed consolidated financial statements.
Previous wording
Net cash used in operating activities during the nine months ended October 31, 2024 consisted of cash outflows of $254.4 million exceeding the $236.4 million collected from customers. Significant components of cash outflows included $128.3 million for personnel costs and $52.7 million for marketing programs and events, third-party costs to provide our platform and outsourced professional services.
Current wording
Net cash provided by operating activities during the three months ended April 30, 2025 consisted of cash collected from customers of $93.2 million exceeding the cash outflows of $89.2 million. Significant components of cash outflows included $47.9 million for personnel costs and $22.0 million for marketing programs and events, third-party costs to provide our platform, outsourced professional services, and other operating expenditures.
Previous wording
Net cash provided by operating activities during the nine months ended October 31, 2025 consisted of cash collected from customers of $232.1 million exceeding $221.4 million of cash outflows. Significant components of cash outflows included $121.4 million for personnel costs and $52.2 million for marketing programs and events, third-party costs to provide our platform and outsourced professional services, and other operating expenditures.
Current wording
Net cash provided by operating activities during the three months ended April 30, 2026 consisted of cash collected from customers of $96.9 million exceeding $91.9 million of cash outflows. Significant components of cash outflows included $46.5 million for personnel costs and $23.4 million for marketing programs and events, third-party costs to provide our platform and outsourced professional services, and other operating expenditures.
Previous wording
Net cash used in investing activities during the nine months ended October 31, 2024 consisted primarily of $5.8 million of capitalized development costs related to internal-use software and $1.4 million of purchased property and equipment.
Current wording
Net cash used in investing activities during the three months ended April 30, 2025 consisted primarily of $2.5 million of capitalized development costs related to internal-use software and $0.4 million of purchased property and equipment.
Previous wording
Net cash used in investing activities during the nine months ended October 31, 2025 consisted primarily of $7.1 million of capitalized development costs related to internal-use software and $0.5 million of purchased property and equipment.
Current wording
Net cash used in investing activities during the three months ended April 30, 2026 consisted primarily of $1.8 million of capitalized development costs related to internal-use software.
Previous wording
Net cash used in financing activities for the nine months ended October 31, 2025 consisted primarily of $10.7 million of payments on short-term payable financing, $2.7 million used to repurchase shares for tax withholdings on vesting of restricted stock, $0.2 million in debt-issuance costs, and $0.2 million in deferred costs for registration statement. These were partially offset by $11.0 million of proceeds from short-term payable financing and $1.3 million of proceeds from shares issued in connection with our employee stock purchase plan.
Current wording
Net cash used in financing activities for the three months ended April 30, 2025 consisted primarily of $3.7 million of payments on short-term payable financing, $0.5 million used to repurchase shares for tax withholdings on vesting of restricted stock, $0.2 million for debt issuance costs, $0.2 million of payments of deferred offering costs for a registration statement, partially offset by $3.3 million of proceeds from short-term payable financing and $0.7 million of proceeds from shares issued in connection with our employee stock purchase plan.
Previous wording
Net cash provided by financing activities for the nine months ended October 31, 2024 consisted primarily of $52.8 million of debt proceeds, $9.0 million of proceeds from short-term payable financing, and $1.9 million of proceeds from shares issued in connection with our employee stock purchase plan, offset by $53.2 million of repayment of debt and related fees, $4.5 million of payments on short-term payable financing, and $0.5 million used to repurchase shares for tax withholdings on vesting of restricted stock.
Current wording
Net cash used in financing activities for the three months ended April 30, 2026 consisted primarily of $3.8 million of payments on short-term payable financing and $3.4 million used to repurchase shares for tax withholdings on vesting of restricted stock. These were partially offset by $0.3 million of proceeds from shares issued in connection with our employee stock purchase plan.
Previous wording
We prepare our condensed consolidated financial statements in accordance with generally accepted accounting principles in the United States (GAAP). The preparation of these condensed consolidated financial statements requires us to make estimates and assumptions that are inherently uncertain and that affect the reported amounts of assets, liabilities, revenue, costs and expenses, and related disclosures. To the extent that there are material differences between these estimates and actual results, our financial condition or results of operations would be affected. We base our estimates on past experience and other assumptions that we believe are reasonable under the circumstances, and we evaluate these estimates on an ongoing basis. Critical accounting policies and estimates are those that we consider critical to understanding our historical and future performance, as these policies relate to the more significant areas involving management’s judgments and estimates.
Current wording
We prepare our condensed consolidated financial statements in accordance with generally accepted accounting principles in the United States, or GAAP. The preparation of these condensed consolidated financial statements requires us to make estimates and assumptions that are inherently uncertain and that affect the reported amounts of assets, liabilities, revenue, costs and expenses, and related disclosures. To the extent that there are material differences between these estimates and actual results, our financial condition or results of operations would be affected. We base our estimates on past experience and other assumptions that we believe are reasonable under the circumstances, and we evaluate these estimates on an ongoing basis. Critical accounting policies and estimates are those that we consider critical to understanding our historical and future performance, as these policies relate to the more significant areas involving management’s judgments and estimates.
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
Subscription revenue increased primarily due to a $3.3 million increase from new customers, partially offset by a $2.5 million net decrease from existing customers. Our total customer count decreased slightly from October 31, 2024 to October 31, 2025. For the purposes of this comparison, new customers are defined as those added since the end of the prior year quarter, and revenue from existing customers is presented net of churn. Professional services and other revenue decreased primarily due to the delivery of certain other contracts recognized in the prior year quarter.
Previous report — wording carried elsewhere
Cost of Revenue, Gross Profit and Gross Margin