KALTURA INC

Previous wording

Reflected below is a summary of reportable segment revenue and reportable segment gross profit for the three months ended March 31, 2026 and 2025.

Current wording

Reflected below is a summary of reportable segment revenue and reportable segment gross profit for the three and six months ended June 30, 2026 and 2025.

Previous wording

We employ a "land and expand strategy" with the aim of having our customers increase their usage of our offerings and/or purchase additional offerings over time. For the three months ended March 31, 2026 and 2025, our Net Dollar Retention Rate was 95% and 107%, respectively, primarily reflecting the lagging impact of elevated churn in our M&T segment in 2025 . Our Annualized Recurring Revenue (as defined below), declined by 3% in the three months ended March 31, 2026, compared to the three months ended March 31, 2025.

Current wording

We employ a "land and expand strategy" with the aim of having our customers increase their usage of our offerings and/or purchase additional offerings over time. Our Net Dollar Retention Rate (as defined below) measures our success in retaining and growing recurring revenue from our existing customers over a given period. For the three months ended June 30, 2026 and 2025, our Net Dollar Retention Rate was 96% and 101%, respectively. We grew our Annualized Recurring Revenue (as defined below) by 8% in the three months ended June 30, 2026, compared to the three months ended June 30, 2025. The increase includes the contribution of the PathFactory acquisition, together with growth from new customers.

Previous wording

We believe our platform is ideally suited for expansion across solutions, industries, and use cases. For example, in 2020, we entered the real-time conferencing market with the introduction of our Virtual and Hybrid Events, Webinars, and Online Learning products, focusing on learning, training, events, and marketing.

Current wording

We believe our platform is ideally suited for expansion across solutions, industries, and use cases. For example, in 2020, we entered the real-time conferencing market with the introduction of our Virtual and Hybrid Events, Webinars, and Online Learning products, focusing on learning, training, events, and marketing. Since then, we expanded the capabilities of our Virtual & Hybrid Events product to support a broader range of event types and use cases, fitted them to also address low-touch and self-serve sales and introduced a set of Gen AI-powered capabilities designed to increase productivity in creating content and setting up events and to foster user engagement. Our acquisition of PathFactory further expanded our platform by adding AI-powered content intelligence, personalized content experiences, journey orchestration, and engagement analytics built to enable customers to better understand user intent and deliver more relevant experiences throughout the buyer journey. We plan to continue enhancing our platform’s capabilities—including by further integrating Gen AI features that enable automatic video creation, advanced personalization, and real-time analytics. Our robust API-first architecture supports deep integration into multiple workflows, which we believe is critical for driving adoption and delivering enhanced value for our customers. One example of recently growing use-case being adopted by our customers is customer-support and call-centers, where Kaltura Genie and Agents are used to improve support ticket resolution times and training of support personnel and customers.

Previous wording

We remain focused on acquiring customers across our key verticals (technology, education, regulated industries, professional and commercial services, and media & telecom). Our approach includes direct enterprise sales for larger customers, as well as channel partnerships and more self-serve or inside sales–led motions to capture SMEs. We believe that increasing brand awareness and continued product innovation will help us attract new customers across geographies and industries. We also continue to provide our self-serve offering that can be purchased completely online, which serves as a demand generation engine for our low-touch and enterprise offerings. We believe this will enable us to efficiently acquire smaller customers across all industries over time–expanding beyond enterprises into SMEs, beyond universities into K-12 schools, beyond tier 1 media and telecom companies to tier 2 and 3 media and telecom companies, and beyond providing Media Services to large technology companies to also addressing smaller technology firms and startups.

Current wording

We remain focused on acquiring customers across our key verticals (technology, education, regulated industries, professional and commercial services, and media & telecom). Our approach includes direct enterprise sales for larger customers, as well as channel partnerships and more self-serve or inside sales–led motions to capture small and medium enterprises (“SMEs”). We believe that increasing brand awareness and continued product innovation will help us attract new customers across geographies and industries. We also continue to provide our self-serve offering that can be purchased completely online, which serves as a demand generation engine for our low-touch and enterprise offerings. We believe this will enable us to efficiently acquire smaller customers across all industries over time – expanding beyond enterprises into SMEs, beyond universities into K-12 schools, beyond tier 1 media and telecom companies to tier 2 and 3 media and telecom companies, and beyond providing Media Services to large technology companies to also addressing smaller technology firms and startups.

Previous wording

Many of our customers run multiple Kaltura products for various use cases, ranging from employee training and collaboration to external marketing and virtual events. By cross-selling and upselling additional solutions—such as our newly introduced Gen AI-powered capabilities and expanded application suites—we aim to drive higher usage and expand overall revenue. Sustained customer adoption and usage growth are also supported by strong integration, ongoing support, and a commitment to evolving security and compliance requirements. We are focused on increasing sales within our existing customer base through increased usage of our platform and the cross-selling of additional products and solutions. For the three months ended March 31, 2026, our Net Dollar Retention Rate was 95%. In order for us to increase revenue within our customer base, we will need to maintain engineering-level customer support and continue to introduce new products and features as well as innovative new use cases that are tailored to our customers' needs.

Current wording

Many of our customers run multiple Kaltura products for various use cases, ranging from employee training and collaboration to external marketing and virtual events. By cross-selling and upselling additional solutions — such as our newly introduced Gen AI-powered capabilities and expanded application suites — we aim to drive higher usage and expand overall revenue. Our strong integration, ongoing support, and a commitment to evolving security and compliance requirements also helps us support sustained customer adoption and usage growth. We are focused on increasing sales within our existing customer base through increased usage of our platform and the cross-selling of additional products and solutions. For the three months ended June 30, 2026, our Net Dollar Retention Rate was 96%. In order for us to increase revenue within our customer base, we will need to maintain engineering-level customer support and continue to introduce new products and features as well as innovative new use cases that are tailored to our customers' needs.

Previous wording

Although we have invested significantly in our business to date, we believe that we still have a significant market opportunity ahead of us. We intend to continue to make investments to support the growth and expansion of our business and to increase revenue. We expect that our cost of revenue and operating expenses will fluctuate.

Current wording

Although we have invested significantly in our business to date, we believe that we still have a significant market opportunity ahead of us. We intend to continue to make investments to support the growth and expansion of our business and to increase revenue. We believe there is a significant opportunity to continue our growth. We expect that our cost of revenue and operating expenses will fluctuate over time.

Previous wording

(1) Remaining Performance Obligations as of March 31, 2025 reflect a reassessment of the historical treatment of certain customer contracts that contain “termination for convenience” clauses, which has resulted in a negative adjustment of $30,239.

Current wording

(1) Remaining Performance Obligations as of June 30, 2025 reflect a reassessment of the historical treatment of certain customer contracts that contain “termination for convenience” clauses, which has resulted in a negative adjustment of $22,710.

Previous wording

Our Net Dollar Retention Rate, which we use to measure our success in retaining and growing recurring revenue from our existing customers, compares our recognized recurring revenue from a set of customers across comparable periods. We calculate our Net Dollar Retention Rate for a given period as the recognized recurring revenue from the latest reported fiscal quarter from the set of customers whose revenue existed in the reported fiscal quarter from the prior year (the numerator), divided by recognized recurring revenue from such customers for the same fiscal quarter in the prior year (denominator). For annual periods, we report Net Dollar Retention Rate as the arithmetic average of the Net Dollar Retention Rate for all fiscal quarters included in the period.

Current wording

Our Net Dollar Retention Rate, which we use to measure our success in retaining and growing recurring revenue from our existing customers, compares our recognized recurring revenue from a set of customers across comparable periods. We calculate our Net Dollar Retention Rate for a given period as the recognized recurring revenue from the latest reported fiscal quarter from the set of customers whose revenue existed in the reported fiscal quarter from the prior year (the numerator), divided by recognized recurring revenue from such customers for the same fiscal quarter in the prior year (denominator). For annual periods, we report Net Dollar Retention Rate as the arithmetic average of the Net Dollar Retention Rate for all fiscal quarters included in the period. We consider subdivisions of the same legal entity (for example, divisions of a parent company or separate campuses that are part of the same state university system) ,as well as Value-add Resellers (“VARs”) (meaning resellers that directly manage the relationship with the customer) and the customers they manage, to be a single customer for purposes of calculating our Net Dollar Retention Rate. Our calculation of Net Dollar Retention Rate for any fiscal period includes the positive recognized recurring revenue impacts of selling new services to existing customers and the negative recognized recurring revenue impacts of contraction and attrition among this set of customers. Our Net Dollar Retention Rate may fluctuate as a result of a number of factors, including the growing level of our revenue base, the level of penetration within our customer base, expansion of products and features, and our ability to retain our customers. Our calculation of Net Dollar Retention Rate may differ from similarly titled metrics presented by other companies.

Previous wording

Remaining Performance Obligations represents the amount of contracted future revenue that has not yet been recognized, including both subscription and professional services revenues. Remaining Performance Obligations consists of both deferred revenue and contracted non-cancelable amounts that will be invoiced and recognized in future periods.

Current wording

Remaining Performance Obligations represents the amount of contracted future revenue that has not yet been delivered, including both subscription and professional services revenues. Remaining Performance Obligations consists of both deferred revenue and contracted non-cancelable amounts that will be invoiced and recognized in future periods. As of June 30, 2026, our Remaining Performance Obligations was $164.3 million, which consists of both billed consideration in the amount of $59.8 million and unbilled consideration in the amount of $104.5 million that we expect to invoice and recognize in future periods.

Previous wording

As of March 31, 2026, our Remaining Performance Obligations was $154.5 million, which consists of both billed consideration in the amount of $55.7 million and unbilled consideration in the amount of $98.8 million that we expect to invoice and recognize in future periods. We expect to recognize 67% of our Remaining Performance Obligations as revenue over the next 12 months and the remainder over the next four years, in each case, in accordance with our revenue recognition policy.

Current wording

We expect to recognize 71% of our Remaining Performance Obligations as revenue over the next 12 months and the remainder over the next four years, in each case, in accordance with our revenue recognition policy.

Previous wording

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

Current wording

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

Previous wording

(a)The three months ended March 31, 2026 and 2025 included $544 and $609 respectively, of interest expenses and $540 and $896 respectively, of interest income.

Current wording

(a)The three months ended June 30, 2026 and 2025, and the six months ended June 30, 2026 and 2025 include $532, $602, $1,075 and $1,210, respectively, of interest expenses and $663, $737, $1,203 and $1,632, respectively, of interest income.

Previous wording

(b)Strategic initiatives expenses for the three months ended March 31, 2026 relate to professional fees, consulting services, transaction-related costs incurred in connection with the acquisition of PathFactory and other costs associated with strategic initiatives.

Current wording

(b)Strategic initiatives for the three and six months ended June 30, 2026 and 2025 relate to professional fees, consulting services, and transaction-related costs incurred in connection with the acquisition of PathFactory and other costs associated with strategic initiatives.

Previous wording

Our revenues are mainly comprised of revenue from SaaS and PaaS subscriptions. SaaS and PaaS subscriptions provide access to our Video Experience Cloud which powers all types of video experiences: live, real-time, and on-demand video. We provide access to our platform either as a cloud-based service, which represent most of our SaaS and PaaS subscriptions, or, less commonly, as a term license to On-Prem software. Revenue from SaaS and PaaS subscriptions is recognized ratably over the time of the subscription, beginning from the date on which the customer is granted access to our Video Experience Cloud. Revenue from the sale of a term license is recognized at a point in time in which the license is delivered to the customer. Revenue from post-contract services (“PCS”) included in On-Prem deals is recognized ratably over the period of the PCS.

Current wording

Our revenues are mainly comprised of revenue from SaaS and PaaS subscriptions. SaaS and PaaS subscriptions provide access to our Video Experience Cloud which powers all types of video experiences: live, real-time, and on-demand video. We provide access to our platform either as a cloud-based service, which represents most of our SaaS and PaaS subscriptions, or, less commonly, as a term license to software installed on the customer's premises. Revenue from SaaS and PaaS subscriptions is recognized ratably over the time of the subscription, beginning from the date on which the customer is granted access to our Video Experience Cloud. Revenue from the sale of a term license is recognized at a point in time in which the license is delivered to the customer. Revenue from post-contract services ("PCS") included in On-Prem deals is recognized ratably over the period of the PCS.

Previous wording

Cost of revenue decreased in absolute dollars from the three months ended March 31, 2025 to the three months ended March 31, 2026. For the three months ended March 31, 2026 and 2025, our cost of revenue was $12,518 and $14,248, respectively.

Current wording

Cost of revenue decreased in absolute dollars in the three and six months ended June 30, 2026 from the three and six months ended June 30, 2025. For the three months ended June 30, 2026 and 2025, and for the six months ended June 30, 2026 and 2025, our cost of revenue was $12,357, $13,243, $24,874 and $27,491, respectively.

Previous wording

Gross margin has improved year-over-year since 2020, on an aggregate basis, and while it has and will continue to vacillate between quarters, we expect our growth trend to continue in the coming years. Gross margins have been, and will continue to be, affected by a variety of factors, including the average sales price of our products and services, volume growth, the mix of revenue between software licenses, maintenance and support, professional services, onboarding of new media and telecom customers, hosting of major virtual events, and changes in cloud infrastructure and personnel costs. In particular, the gross margins in the M&T segment are lower than in the EE&T segment because of resources required for implementing solutions for TV experiences, which generally exceed those of other offerings. This results in a longer period for M&T from initial booking to go-live and a higher proportion of professional services revenue as a percentage of overall revenue. Additionally, a higher proportion of M&T revenue comes from customers who choose to license our offerings through private cloud and on-premise deployments, which also impacts our M&T gross margin.

Current wording

Gross margins have improved year-over-year since 2020, and while this measure has and will continue to vacillate between quarters, we expect it to continue the growth trend in the coming years. Gross margins have been, and will continue to be, affected by a variety of factors, including the average sales price of our products and services, volume growth, the mix of revenue between software licenses, maintenance and support, professional services, onboarding of new media and telecom customers, hosting of major virtual events, and changes in cloud infrastructure and personnel costs. In particular, the gross margins in the M&T segment are lower than in the EE&T segment because of resources required for implementing solutions for TV experiences, which generally exceed those of other offerings. This results in a longer period for M&T from initial booking to go-live and a higher proportion of professional services revenue as a percentage of overall revenue. Additionally, a higher proportion of M&T revenue comes from customers who choose to license our offerings through private cloud and on-premise deployments, which also impacts our M&T gross margin. Going forward, over the long term, we expect to see a gradual improvement in gross margins for both EE&T and M&T, driven by enhanced efficiencies in both production and professional services costs.

Previous wording

For the three months ended March 31, 2026 and 2025, our gross margins were 72% (77% for subscriptions and (93)% for professional services) and 70% (77% for subscriptions and (81)% for professional services), respectively.

Current wording

For the three months ended June 30, 2026 and 2025, our gross margins were 74% (78% for subscriptions and (99)% for professional services) and 70% (77% for subscriptions and (73)% for professional services), respectively. For the six months ended June 30, 2026 and 2025, our gross margins were 73% (78% for subscriptions and (96)% for professional services) and 70% (77% for subscriptions and (77)% for professional services), respectively.

Previous wording

For our M&T segment, gross margins for the three months ended March 31, 2026 and 2025 were 54% (58% for subscriptions and 9% for professional services) and 49% (58% for subscriptions and (29)% for professional services), respectively.

Current wording

For our M&T segment, gross margins for the three months ended June 30, 2026 and 2025 were 53% (57% for subscriptions and 9% for professional services) and 48% (55% for subscriptions and (1)% for professional services), respectively. For the six months ended June 30, 2026 and 2025, our gross margins for our M&T segment were 53% (58% for subscription and 9% for professional services) and 48% (56% for subscription and (14)% for professional services), respectively.

Previous wording

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

Current wording

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

Previous wording

The following table summarizes key components of our results of operations for the periods presented. The period-to-period comparisons of our historical results are not necessarily indicative of the results that may be expected in the future.

Current wording

The following tables summarize key components of our results of operations for the periods presented. The period-to-period comparisons of our historical results are not necessarily indicative of the results that may be expected in the future.

Previous wording

•Enterprise, Education & Technology (77% and 73% of revenue for the three months ended March 31, 2026 and 2025, respectively): Our EE&T segment represents revenues from all of our products, industry solutions for education customers, and Media Services (except for M&T customers), as well as associated professional services for those offerings.

Current wording

•Enterprise, Education & Technology (78% and 75% of revenue for the three months ended June 30, 2026 and 2025, respectively, and 78% and 74% for the six months ended June 30, 2026 and 2025, respectively): Our EE&T segment represents revenues from all of our products, industry solutions for education customers, and Media Services (except for M&T customers), as well as associated professional services for those offerings.

Previous wording

•Media & Telecom (23% and 27% of revenue for the three months ended March 31, 2026 and 2025, respectively): Our M&T segment primarily represents revenues from our TV Solution and Media Services sold to media and telecom customers.

Current wording

•Media & Telecom (22% and 25% of revenue for the three months ended June 30, 2026 and 2025, respectively, and 22% and 26% for the six months ended June 30, 2026 and 2025, respectively): Our M&T segment primarily represents revenues from our TV Solution and Media Services sold to media and telecom customers.

Previous wording

Total M&T gross profit decreased by $0.5 million, or 8%, to $5.6 million for the three months ended March 31, 2026, from $6.2 million for the three months ended March 31, 2025. This decrease was mainly due to the revenue decrease of $2.1 million, partially offset by lower headcount and reduction in production costs, which is a result of improved efficiency.

Current wording

M&T gross profit decreased by 1%, to $5.3 million for the three months ended June 30, 2026, from $5.4 million for the three months ended June 30, 2025. This decrease was mainly due to the decrease in revenue partially offset by lower headcount and reduction in production costs, which is a result of improved efficiency.

Previous wording

M&T professional services gross profit increased by $0.5 million, or 124%, to $0.1 million gross profit for the three months ended March 31, 2026, from $0.4 million gross loss for the three months ended March 31, 2025.

Current wording

M&T professional services gross profit increased by $0.1 million, or 733%, to $0.1 million profit for the three months ended June 30, 2026, from $0.0 million loss for the three months ended June 30, 2025.

Previous wording

Provision for income taxes increased by $1.1 million, or 83%, to $2.5 million for the three months ended March 31, 2026, from $1.3 million for the three months ended March 31, 2025, primarily due to increased tax liability related to income generated by our subsidiaries organized under the laws of Israel and the United Kingdom.

Current wording

Provision for income taxes increased by $2.0 million or 480%, to $2.5 million for the three months ended June 30, 2026, from $0.4 million for the three months ended June 30, 2025 primarily due to increased tax liability related to income generated by our subsidiaries organized under the laws of Israel and the United Kingdom.

Previous wording

EE&T professional services revenue decreased by $0.3 million, or 42%, to $0.5 million for the three months ended March 31, 2026, from $0.8 million for the three months ended March 31, 2025.

Current wording

EE&T professional services revenue decreased by $0.6 million, or 42%, to $0.9 million for the six months ended June 30, 2026 from $1.5 million for the six months ended June 30, 2025.

Previous wording

Total M&T revenue decreased by $2.1 million, or 17%, to $10.5 million for the three months ended March 31, 2026, from $12.6 million for the three months ended March 31, 2025. The decrease is mainly attributable to a revenue decrease from existing customers.

Current wording

M&T revenue decreased by $3.2 million, or 14%, to $20.6 million for the six months ended June 30, 2026, from $23.8 million for the six months ended June 30, 2025. The decrease is mainly attributable to a decrease in revenue from existing customers.

Previous wording

Sales and marketing expenses slightly decreased by $0.1 million, or 1%, to $11.8 million for the three months ended March 31, 2026, from $11.9 million for the three months ended March 31, 2025.

Current wording

M&T subscription gross profit decreased by $1.1 million, or 9%, to $10.8 million for the six months ended June 30, 2026, from $11.9 million for the six months ended June 30, 2025.

Previous wording

General and administrative expenses increased by $0.4 million to $10.7 million for the three months ended March 31, 2026, from $10.3 million for the three months ended March 31, 2025. The increase was primarily due to a $1.6 million increase in strategic initiatives costs, primarily related to acquisition-related expenses, incurred in connection with the acquisition of PathFactory and professional fees, consulting, and other expenses associated with strategic initiatives, and a $0.3 million increase from the accretion of contingent consideration. These were partially offset by a $1.4 million decrease in compensation expenses, primarily reflects lower stock-based compensation costs, largely driven by the full recognition of high fair value options and RSUs granted in December 2021, which were fully expensed prior to 2025.

Current wording

General and administrative expenses decreased by $2.0 million, or 9%, to $19.2 million for the six months ended June 30, 2026, from $21.2 million for the six months ended June 30, 2025. The decrease was primarily due to a gain of $1.0 million recognized from the remeasurement of contingent consideration to fair value during the current quarter, and a decrease of $2.2 million in compensation costs primarily reflects lower stock-based compensation costs, largely driven by the full recognition of high fair value options and RSUs granted in December 2021, which were fully expensed prior to 2025, and the reallocation of certain personnel to sales functions. These decreases were partially offset by an increase of $0.7 million in other expenses, primarily due to the absence of a prior-year benefit related to the release of a withholding tax accrual following a favorable tax assessment, and $0.7 million increase in strategic initiatives costs, primarily related to acquisition-related expenses, incurred in connection with the acquisition of PathFactory and professional fees, consulting, and other expenses associated with strategic initiatives.

Previous wording

Financial expenses, net increased by $1.9 million, or 105%, to $0.1 million expenses for the three months ended March 31, 2026, from $1.8 million income for the three months ended March 31, 2025. The increase was primarily due to exchange rate differences.

Current wording

Financial expense, net decreased by $0.4 million, or 13%, to $2.4 million expenses for the six months ended June 30, 2026, from $2.8 million expenses for the six months ended June 30, 2025. The decrease was primarily due to change of $0.6 million related to exchange rate differences.

Previous wording

If necessary, we may borrow funds under our Revolving Credit Facility to finance our liquidity requirements, subject to customary borrowing conditions. To the extent additional funds are necessary to meet our long-term liquidity needs as we continue to execute our business strategy, we anticipate that they will be obtained through the incurrence of additional indebtedness, additional equity financings or a combination of these potential sources of funds; however, such financing may not be available on favorable terms, or at all. In particular, the current global economic volatility, including due to uncertainty around U.S. and foreign tariffs and other trade barriers, rising inflation and uncertainty with respect to interest rates, price increases and supply chain issues, deteriorating global political conditions and various other factors, has resulted in, and may continue to result in, significant disruption of global financial markets, reducing our ability to access capital. Our ability to access capital may also be impacted by political, economic, and military conditions in Israel, including the current security situation or any escalation of conflicts with Israel, and in other regions in which we operate, or changes in the business environment in those regions. If we are unable to raise additional funds when desired, our business, financial condition and results of operations could be adversely affected.

Current wording

If necessary, we may borrow funds under our Revolving Credit Facility to finance our liquidity requirements, subject to customary borrowing conditions. To the extent additional funds are necessary to meet our long-term liquidity needs as we continue to execute our business strategy, we anticipate that they will be obtained through the incurrence of additional indebtedness, additional equity financings or a combination of these potential sources of funds; however, such financing may not be available on favorable terms, or at all. In particular, the current global economic volatility, including due to uncertainty around U.S. and foreign tariffs and other trade barriers, rising inflation and uncertainty with respect to interest rates, price increases and supply chain issues, and various other factors, has resulted in, and may continue to result in, significant disruption of global financial markets, reducing our ability to access capital. Our ability to access capital may also be impacted by political, economic, and military conditions in Israel, including the current security situation or any escalation of conflicts with Israel, and in other regions in which we operate, or changes in the business environment in those regions. If we are unable to raise additional funds when desired, our business, financial condition and results of operations could be adversely affected.

Previous wording

In January 2021, we entered into a credit agreement (as amended, the “Credit Agreement”) with one of our existing lenders, which provided for a senior secured term loan facility in the aggregate principal amount of $40.0 million (the “Term Loan Facility”) and a senior secured revolving credit facility in the aggregate principal amount of $10.0 million (the “Revolving Credit Facility” and, together with the Term Loan Facility, the “Credit Facilities”), which thereafter were extended and amended to align our business needs and other developments. In December 2023, we refinanced all amounts outstanding under the then-existing Credit Agreement, and entered into a new amendment to the credit agreement (the “Fifth Amendment”) with an existing lender, which provides for an additional term loan facility of $3.5 million in addition to the existing $31.5 million in term loans outstanding immediately prior to the Fifth Amendment. Commitments under the Revolving Credit Facility decreased to $25.0 million.

Current wording

In January 2021, we entered into a credit agreement (as amended, the “Credit Agreement”) with one of our existing lenders, which provided for a senior secured term loan facility in the aggregate principal amount of $40.0 million (the “Term Loan Facility”) and a senior secured revolving credit facility in the aggregate principal amount of $10.0 million (the “Revolving Credit Facility” and, together with the Term Loan Facility, the “Credit Facilities”), which thereafter were extended and amended to align with our business needs and other developments. In December 2023, we refinanced all amounts outstanding under the then-existing Credit Agreement and entered into a new amendment to the credit agreement (the “Fifth Amendment”) with an existing lender, which provides for an additional term loan facility of $3.5 million in addition to the existing $31.5 million in term loans outstanding immediately prior to the Fifth Amendment. Commitments under the Revolving Credit Facility decreased to $25.0 million.

Previous wording

Following the effectiveness of the Fifth Amendment, borrowings under the Credit Facilities are subject to interest, determined as follows: (a) SOFR loans accrue interest at a rate per annum equal to Term SOFR (as defined in the Credit Agreement) plus 0.10% per annum plus a margin of 2.50% (the Adjusted Term SOFR (as defined in the Credit Agreement) is subject to a 1.00% floor), and (b) Alternative Base Rate ("ABR") loans (as defined in the Credit Agreement) accrue interest at a rate per annum equal to the ABR plus a margin of 1.50% (ABR is equal to the highest of (i) the prime rate and (ii) the Federal Funds Effective Rate plus 0.50%, subject to a 2.00% floor). As of March 31, 2026, the current rate of interest under the Credit Facilities was equal to a rate per annum of 6.30%, consisting of 3.70% (the 3-month SOFR rate as of March 31, 2026), 0.10% credit spread adjustment and the margin of 2.50%.

Current wording

Following the effectiveness of the Fifth Amendment, borrowings under the Credit Facilities are subject to interest, determined as follows: (a) SOFR loans accrue interest at a rate per annum equal to Term SOFR (as defined in the Credit Agreement) plus 0.10% per annum plus a margin of 2.50% (the Adjusted Term SOFR (as defined in the Credit Agreement) is subject to a 1.00% floor), and (b) Alternative Base Rate ("ABR") loans (as defined in the Credit Agreement) accrue interest at a rate per annum equal to the ABR plus a margin of 1.50% (ABR is equal to the highest of (i) the prime rate and (ii) the Federal Funds Effective Rate plus 0.50%, subject to a 2.00% floor). As of June 30, 2026, the current rate of interest under the Credit Facilities was equal to a rate per annum of 6.33%, consisting of 3.73% (the 3-month SOFR rate as of June 26, 2026), 0.10% credit spread adjustment and the margin of 2.50%.

Previous wording

The Credit Agreement also contains certain financial covenants that require us to maintain (i) a minimum amount of Consolidated Adjusted EBITDA (as defined in the Credit Agreement) as of the last day of each fiscal quarter (the “Adjusted EBITDA Covenant”), and (ii) Liquidity (as defined in the Credit Agreement) of at least $20.0 million as of the last day of any calendar month. We were in compliance with these covenants as of March 31, 2026.

Current wording

The Credit Agreement also contains certain financial covenants that require us to maintain (i) a minimum amount of Consolidated Adjusted EBITDA (as defined in the Credit Agreement) as of the last day of each fiscal quarter (which minimum amount increased through the fiscal quarter ended December 31, 2023) (the “Adjusted EBITDA Covenant”), and (ii) Liquidity (as defined in the Credit Agreement) of at least $20.0 million as of the last day of any calendar month. We were in compliance with these covenants as of June 30, 2026.

Previous wording

As of March 31, 2026, we had no balance outstanding under the Revolving Credit Facility and the total revolving commitment of $25.0 million remains available for future borrowings. As of March 31, 2026, we had approximately $27.8 million of borrowings outstanding under the Term Loan Facility.

Current wording

As of June 30, 2026, we had no balance outstanding under the Revolving Credit Facility and the total revolving commitment of $25.0 million remains available for future borrowings. As of June 30, 2026, we had approximately $26.6 million of borrowings outstanding under the Term Loan Facility.

Previous wording

Non-cash charges primarily consisted of depreciation and amortization of $1.2 million, stock-based compensation expenses of $3.8 million, amortization of deferred contract acquisitions and fulfillment costs of $2.6 million ,and non-cash interest expense, net of $0.1 million. The main drivers of net cash outflows were a increase in trade receivables of $0.7 million, a decrease in deferred revenue of $6.8 million, an increase in deferred contract acquisition and fulfillment cost of $0.7 million and a net change in operating right-of-use asset and lease liability of $0.1 million partially offset by an increase in trade payables of $4.5 million, an aggregate increase in employees accruals, accrued expenses and other liabilities of $0.3 million, and a decrease of $0.1 million in prepaid expenses and other current assets.

Current wording

The main drivers of net cash outflows were derived from the changes in operating assets and liabilities and were related to a decrease in deferred revenue of $12.9 million, an increase in trade receivables of $6.8 million, an increase in deferred contract acquisition and fulfillment cost of $1.3 million, partially offset by an aggregate increase in employees accruals, and accrued expenses and other liabilities of $6.4 million, an increase in trade payables of $5.8 million, a decrease of $1.0 million in prepaid expenses and other current assets and other assets, and net change in operating right-of-use asset and lease liability of $0.6 million.

Previous wording

Net cash used in operating activities of $1.0 million for three months ended March 31, 2025 was primarily due to $1.1 million incremental net loss, adjusted for non-cash charges of $8.5 million, and net cash outflows of $8.4 million due to changes in our operating assets and liabilities. Non-cash charges primarily consisted of depreciation and amortization of $1.2 million, stock-based compensation expenses of $4.5 million, and amortization of deferred contract acquisitions and fulfillment costs of $2.9 million partially offset by non-cash interest income, net of $0.1 million. The main drivers of net cash outflows were derived from the changes in operating assets and liabilities and were related to a decrease in deferred revenue of $9.3 million, an aggregate increase in employees accruals, and accrued expenses and other liabilities of $3.5 million, an increase in trade receivables of $1.8 million, an increase of $1.3 million in prepaid expenses and other current assets and other assets, increase in deferred contract acquisition and fulfillment cost of $1.1 million and net change in operating lease right of use assets and lease liabilities of $0.2 million, partially offset by increase in trade payables of $5.2 million.

Current wording

Net cash provided by operating activities of $1.6 million for the six months ended June 30, 2025, was primarily due to $8.9 million incremental net loss, adjusted for non-cash charges of $16.0 million, and net cash outflows of $5.5 million due to changes in our operating assets and liabilities. Non-cash charges primarily consisted of depreciation and amortization of $2.3 million, stock-based compensation expenses of $8.6 million and amortization of deferred contract acquisitions and fulfillment costs of $5.7 million partially offset by non-cash interest income, net of $0.2 million. The main drivers of net cash outflows were derived from the changes in operating assets and liabilities and were related to a decrease in deferred revenue of $8.1 million, an increase in trade receivables of $1.3 million, an increase in deferred contract acquisition and fulfillment cost of $2.0 million, an aggregate decrease in employees accruals, and accrued expenses and other liabilities of $1.2 million and an increase of $0.1 million in prepaid expenses and other current assets and other assets, partially offset by, an increase in trade payables of $6.1 million and net change in operating right-of-use asset and lease liability of $1.1 million.

Previous wording

Net cash provided by investing activities of $31.4 million for the three months ended March 31, 2026 was related mainly to proceeds from maturities of marketable securities of $31.8 million, partially offset by capitalized internal-use software development costs of $0.3 million, and $0.1 million of capital expenditures.

Current wording

Net cash provided by investing activities of $2.1 million for the six months ended June 30, 2026 was related to proceeds from maturities of available-for-sale marketable securities of $35.1 million, partially offset by payments for businesses acquired of $22.5 million, purchases of marketable securities of $9.5 million, capitalized internal-use software development costs of $0.9 million and $0.2 million of capital expenditures.

Previous wording

Net cash provided by investing activities of $2.2 million for the three months ended March 31, 2025 was related mainly to proceeds from maturities of marketable securities of $28.9 million, partially offset by purchases of marketable securities of $26.4 million, and $0.3 million of capital expenditures.

Current wording

Net cash provided by investing activities of $11.6 million for the six months ended June 30, 2025 was related to proceeds from maturities of available-for-sale marketable securities of $42.5 million, partially offset by purchases of marketable securities of $30.4 million and $0.4 million of capital expenditures.

Previous wording

Net cash used in financing activities of $1.2 million for the three months ended March 31, 2026 was primarily due to repayment of long-term loans of $1.3 million, offset by $0.1 million due to proceeds from the exercise of stock options.

Current wording

Net cash used in financing activities of $2.4 million for the six months ended June 30, 2026 was primarily due to repayment of long-term loans of $2.6 million, partially offset by $0.2 million due to proceeds from the exercise of stock options.