ServiceTitan, Inc.
For the period ended Jan 31, 2026. Filed Mar 25, 2026.
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A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2026 · Filed Mar 25, 2026
TTAN$81.77-0.5%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2025-01-31; filed 2025-04-02.
0000950170-25-048834
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2026-01-31; filed 2026-03-25.
0001638826-26-000028
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 147 previous paragraphs and 131 current paragraphs.
88 unchanged; 31 reworded; 12 added; 28 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 26 previous and 18 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 (12)
Current report
Other Income (Expense), Net
Current report
Professional services and other revenue increased by $3.2 million, or 10%, for fiscal 2026, compared to fiscal 2025. This increase was primarily driven by a higher volume of services performed.
Current report
Platform cost of revenue increased by $10.6 million, or 5%, for fiscal 2026, compared to fiscal 2025. This increase was primarily due to a $16.4 million increase in the costs related to the provisioning of our platform services products. This increase was partially offset by a $6.0 million decrease in personnel-related costs, primarily due to the shift in roles of our customer success function to sales and marketing activities at the beginning of fiscal 2026.
Current report
Professional services and other cost of revenue increased $5.7 million, or 8%, for fiscal 2026, compared to fiscal 2025. Personnel-related costs increased by $7.7 million primarily due to an increase in headcount. This increase was partially offset by a decrease of $2.3 million in third-party service fees.
Current report
Research and development expense increased by $39.5 million, or 15%, for fiscal 2026, compared to fiscal 2025. The increase in research and development expense was primarily driven by an increase of $35.7 million in personnel-related costs, which included an increase in headcount and an increase of $6.7 million in stock-based compensation. There was also an increase of $4.9 million in employee benefit expenses primarily related to health insurance and an increase of $4.4 million in infrastructure and server costs. These increases were partially offset by a decrease of $4.6 million in impairment losses on operating lease assets and related property and equipment for office spaces that we ceased to use.
Current report
General and administrative expense increased by $35.0 million, or 16%, for fiscal 2026, compared to fiscal 2025. The increase in general and administrative expense was primarily driven by an increase of $31.7 million in personnel-related costs, which included an increase in headcount and an increase of $24.5 million in stock-based compensation. In fiscal 2026, stock-based compensation includes $53.6 million related to performance-based RSUs granted to our Co-Founders in October 2024. Additionally, there was an increase of $7.1 million in third-party consulting costs related to legal, consulting and audit services, an increase of $5.6 million in our allowance for credit losses as we further integrated acquired businesses, and an increase of $2.5 million in employee benefit expenses primarily related to health insurance. These increases were partially offset by a decrease of $13.2 million in impairment losses on operating lease assets and related property and equipment for office spaces that we ceased to use.
Current report
Other Income (Expense), Net
Current report
Non-GAAP Net Income
Current report
In January 2023, we entered into a secured credit agreement (the “Original Credit Agreement”) with Wells Fargo Bank N.A., as administrative agent and collateral agent, and certain lenders. In September 2024, we amended the Original Credit Agreement (the “First Amendment”) to, among other things, convert our existing term loan to a new term loan balance and a revolving credit facility. On January 30, 2026, we entered into a second amendment (the “Second Amendment”) to the Original Credit Agreement (as amended by the First Amendment and the Second Amendment, the “Amended Credit Agreement”) that increased the total borrowing capacity of the revolving credit facility made available under the Amended Credit Agreement from $140.0 million to $250.0 million and extended the term of the Amended Credit Agreement through January 30, 2031.
Current report
In addition, the Second Amendment (i) modified pricing and unused commitment fees payable under the Amended Credit Agreement to be based on total net leverage rather than recurring revenue, (ii) replaced the recurring revenue and liquidity financial covenants in the Original Credit Agreement with a total net leverage financial covenant, and (iii) modified certain negative covenants, including liens, indebtedness, investments, dispositions, restricted payments and restricted debt payments, to provide us with more flexibility thereunder. Prior to entering into the Second Amendment we voluntarily repaid, in full, the approximately $107.0 million term loan that was outstanding under the Original Credit Agreement. As of January 31, 2026, no loans were outstanding under the Amended Credit Agreement.
Current report
Net cash used in financing activities was $78.8 million for fiscal 2026. This consisted primarily of the repayment of debt of approximately $107.0 million, and the payment of deferred offering costs of $0.6 million. These were partially offset by proceeds from the exercise of stock options of $28.8 million.
Current report
Critical Accounting Estimates
Removed paragraphs (28)
Previous report
Recent Developments
Previous report
Initial Public Offering
Previous report
In December 2024, we completed our initial public offering (the “IPO”), in which we issued and sold an aggregate of 10,120,000 shares of our Class A common stock at a public offering price of $71.00 per share. Wereceived aggregate proceedsof $674.1 million, net of underwriting costs and offering expenses. Immediately prior to the closing of the IPO, all 42,465,855 shares of our then-outstanding shares of redeemable convertible preferred stock automatically converted into 44,257,289 Class A common shares at their respective as-adjusted conversion ratios.
Previous report
Upon the effectiveness of the registration statement on Form S-1 relating to the IPO (the “IPO Registration Statement”), the performance vesting condition of certain stock options and restricted stock units (“RSUs”) was met, and we recognized$59.1 million of stock-based compensation expense for the portion of the service period completed by service providers from the grant date through the effectiveness of the IPO Registration Statement.
Previous report
In addition, we expect our sales marketing expense to increase in absolute dollars and as a percentage of revenue resulting from a portion of our customer success personnel shifting roles to sales and marketing activities at the beginning fiscal 2026 as we shift the customer success function to focus on both customer retention and also customer expansion.
Previous report
Other Expense, Net
Previous report
Professional services and other revenue decreased by $0.2 million, or 1%, for fiscal 2025, compared to fiscal 2024. This decrease was primarily driven by the disposal of certain marketing solutions in the fourth quarter of fiscal 2024, which contributed $4.7 million in revenue for fiscal 2024. The decrease was partially offset by increased revenue from a higher volume of professional services performed in fiscal 2025.
Previous report
Platform cost of revenue increased by $33.2 million, or 20%, for fiscal 2025, compared to fiscal 2024. This increase was primarily due to a $13.7 million increase in the costs related to the provisioning of our platform services products and $10.4 million increase in personnel-related costs, primarily due to an increase in headcount. In addition, amortization of capitalized internally developed software increased by $4.8 million and we also recorded a $4.7 million increase in impairment losses on operating lease assets and related property and equipment for the portion of our headquarters that weceased to use. These increases were partially offset by a decrease of $0.8 million of restructuring costs related to our reductions in workforce. Platform gross margin increased to 73% for fiscal 2025, compared to 71% for fiscal 2024, primarily due to improved efficiencies in delivering our platform at scale.
Previous report
Professional services and other cost of revenue were flat for fiscal 2025, compared to fiscal 2024. Personnel-related costs increased by $3.6 million primarily due to an increase in headcount and we also recorded a $2.3 million increase in impairment losses on operating lease assets and related property and equipment for a portion of our headquarters space that weceased to use. These increases were partially offset by a decrease of $2.7 million in acquired amortization of intangible assets due toaccelerated amortization expense related to the disposal of certain marketing solutions in fiscal 2024, and a decrease of $2.1 million of restructuring costs related to our reductions in workforce. Professional services and other gross margin decreased slightly to (110)% for fiscal 2025, compared to (108)% for fiscal 2024.
Previous report
Research and development expense increased by $59.5 million, or 29%, for fiscal 2025, compared to fiscal 2024. The increase in research and development expense was primarily driven by an increase of $48.0 million in personnel-related costs related to an increase in headcount, including an increase of $12.8 million in stock-based compensation. The increase in stock-based compensation included $8.7 million in expense recorded for performance awards where vesting was triggered due to our IPO. Additionally, infrastructure and server costs and software subscription fees related to our ongoing product development efforts increased $4.3 million related to our ongoing product development efforts. We also recorded a $5.8 million increase in impairment losses on operating lease assets and related property and equipment for a portion of our headquarters space that weceased to use. These increases were partially offset by a decrease of $1.0 million in third-party development resources as we leveraged more internal development resources in fiscal 2025.
Previous report
General and administrative expense increased by $78.5 million, or 58%, for fiscal 2025, compared to fiscal 2024. The increase in general and administrative expense was primarily driven by an increase of $57.4 million in personnel-related costs related to an increase in headcount, including an increase of $44.8 million in stock-based compensation. The increase in stock-based compensation also included $52.2 million in expense recorded for performance awards where vesting was triggered due to our IPO, of which $15.0 million related to performance-based RSUs granted to our Co-Founders, which were partially offset by a $6.2 million expense in fiscal 2024 related to the 2024 Tender Offer. We also recorded a $15.5 million increase in impairment losses on operating lease assets and related property and equipment for a portion of our headquarters space that weceased to use. Additionally, consulting and professional fees increased $2.7 million primarily related to preparation activities for our IPO in fiscal 2025 and acquisition related expenses increased $1.6 million related to our acquisition of Convex Labs Inc. (“Convex”) in fiscal 2025.
Previous report
Other Expense, Net
Previous report
Non-GAAP Net Income (Loss)
Previous report
In January 2023, we entered into a secured credit agreement with Wells Fargo Bank N.A., as administrative agent and collateral agent, and certain lenders. In September 2024, we entered into an amendment to the secured credit agreement, effective October 1, 2024 (as amended, the “Credit Agreement”) that converted our existing term loan balance of $177.3 million and $70.0 million revolver facility to a term loan of $107.3 million (as amended, the“Term Loan”) and a revolver facility of $140.0 million, of which $70.0 million was initially drawn (as amended, the“Revolver Facility”). In January 2025 we repaid all amounts outstanding under the Revolver Facility. The Credit Agreement contains the standard and customary covenants for agreements of this type, including various reporting, affirmative and negative covenants. Among other things, these covenants set forth minimum revenue thresholds, require the maintenance of minimum liquidity and establish certain limits to our and our subsidiaries’ ability to create or incur liens on assets, make acquisitions of or investments in businesses, engage in any material line of business substantially different from our current lines of business, incur additional indebtedness or contingent obligations, sell or dispose of assets, pay dividends and make loans or advances to employees.
Previous report
The Term Loan and Revolver Facility will mature in January 2028 and bear interest at a floating rate at our option of either (i) a term Secured Overnight Financing Rate (“SOFR”), based rate for a specified interest period plus an applicable margin, which is initially 2.5% per annum and ranges from 2.25% to 3.00% per annum based on a ratio of outstanding debt to annual recurring revenue, or (ii) a base rate plus an applicable margin, which is initially 1.5% per annum and ranges from 1.25% to 2.0% per annum based on the ratio of total outstanding debt to annual recurring revenue. On the first day of each calendar quarter, we have been required to repay an aggregate principal amount equal to 0.25% of the aggregate original principal amount of the Term Loan, which repayment amount became fixed at approximately $0.3 million beginning January 1, 2025. The Revolver Facility will incur a 0.25% annual fee for undrawn amounts.
Previous report
As of January 31, 2025, we had total debt of $105.1 million, consisting of the outstanding principal balance of the Term Loan of $107.0 million, net of unamortized debt issuance costs of $1.9 million. There was no balance drawn under the Revolver Facility.
Previous report
Net cash provided by financing activities was $24.3 million for fiscal 2024. This consisted of proceeds from the issuance of Series H-1 redeemable convertible preferred stock, net of issuance costs, of $33.6 million and $9.7 million from the exercise of stock options, partially offset by the net settlement of shares for tax withholding of RSUs of $16.5 million, the payment of debt of $1.4 million, and the payment of contingent consideration of $0.8 million.
Previous report
Critical Accounting Policies and Estimates
Previous report
An accounting policy is deemed critical if it is both important to the portrayal of our financial condition and results and requires us to make difficult, subjective, or complex judgments, often as a result of the need to make estimates about the effects of matters that are inherently uncertain. An accounting estimate is deemed critical where the nature of the estimate is material due to the levels of subjectivity and judgment necessary to account for highly uncertain matters or the susceptibility of such matters to change, and the impact of the estimate on our financial condition or operating performance is material.
Previous report
Stock-based compensation represents a critical accounting policy to the understanding of our results of operations. For information regarding our stock-based compensation accounting policy, see Note 2 to our audited consolidated financial statements included elsewhere in this Annual Report.
Previous report
The value of our common stock is the primary input to measure the grant date fair value of our stock-based awards. The valuation of our common stock used in estimating the grant date fair value of our stock-based awards granted prior to our IPO was a critical accounting estimate as it was subject to significant assumptions and estimates as described below.
Previous report
Common Stock Valuations
Previous report
Prior to our Class A common stock trading on the Nasdaq Global Select Market, we were required to estimate the fair value of the common stock underlying our stock awards. Significant judgment was required in determining the fair value of our common stock. Such fair values of our common stock underlying our stock-based awards were determined by our board of directors with input from management and independent third-party valuations prepared in accordance with the American Institute of Certified Public Accountants Accounting and Valuation Guide: Valuation of Privately-Held-Company Equity Securities Issued as Compensation. We believe that our board of directors has the relevant experience and expertise to determine the fair value of our common stock. As described below, the exercise price of our stock-based options was determined by our board of directors based in part on the most recent contemporaneous third-party valuation as of the grant date. Given the absence of a public trading market of our common stock, our board of directors exercised reasonable judgment and considered numerous objective and subjective factors to determine the best estimate of the fair value of our common stock including:
Previous report
In valuing our common stock, we determined the equity value using a hybrid approach where two scenarios were examined: (1) the IPO scenario and (2) the stay private scenario. The per share equity values derived from these scenarios were then probability weighted to estimate the per share value of our common stock.
Previous report
In the IPO scenario, we used the precedent transaction method which estimates the fair value of our equity based on the sale prices of shares of our preferred or common stock in a recent financing, if applicable, or other transactions in our capital stock. We then estimated the per share value of our common stock by dividing the total equity value by our number of shares of common stock assuming our preferred stock converts.
Previous report
In the stay private scenario, we estimated the fair value of our equity using a market approach valuation method. The market approach estimates equity value based on the guideline public company method or the precedent transaction method described above. The guideline public company method analyzes the comparison of the subject company to comparable public companies in a similar line of business. From the comparable companies, a representative market value multiple is determined and then applied to the subject company’s financial metrics to estimate the value of the subject company. We then determined the per share value of our common stock using an option-pricing model (“OPM”), to which we then applied a lack of marketability discount. The OPM allocates values to each equity class by creating a series of call options on our equity value, with exercise prices based on the liquidation preferences, participation rights and strike prices of the equity instruments.
Previous report
JOBS Act Accounting Election
Previous report
We are an emerging growth company, as defined in the Jumpstart Our Business Startups Act of 2012, as amended (the “JOBS Act”). Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act until such time as those standards apply to private companies. We have elected to use this extended transition period until we are no longer an emerging growth company or until we affirmatively and irrevocably opt out of the extended transition period. As a result, our consolidated financial statements may not be comparable to companies that comply with new or revised accounting pronouncements applicable to public companies.
Reworded paragraphs (31)
Previous wording
ServiceTitan was born in the trades and built for the trades. Our founders, Ara Mahdessian and Vahe Kuzoyan (our “Co-Founders”), founded ServiceTitan to provide tradespeople, like their parents, with technology that is purpose built to help trades businesses thrive.
Current wording
ServiceTitan was born in the trades and built for the trades. Our founders, Ara Mahdessian and Vahe Kuzoyan (our “Co-Founders”), are the sons of trades business owners and founded ServiceTitan to provide tradespeople, like their parents, with technology that is purpose built to help trades businesses thrive.
Previous wording
Our software provides an end-to-end, cloud-based software platform that connects and manages a wide array of business workflows such as advertising, job scheduling and management, dispatching, generating estimates and invoices, payment processing and more. Tradespeople spend their days interfacing with the ServiceTitan platform across what we believe to be the five most business-critical functions, or the “core centers of gravity,” inside a trades business: CRM (customer relationship management, including sales enablement, marketing automation and customer service), FSM (field service management, including scheduling and dispatching), ERP (enterprise resource planning, including inventory), HCM (human capital management, including compensation and payroll integration) and FinTech (including payments and third-party consumer financing). By offering interoperable capabilities in all five centers of gravity, we continuously capture comprehensive data insights across key workflows in a trades business.
Current wording
Our software provides an end-to-end, cloud-based software platform that connects, manages and automates a wide array of business workflows such as advertising, job scheduling and management, dispatching, generating estimates and invoices, payment processing and more. Tradespeople spend their days interfacing with the ServiceTitan platform across what we believe to be the five most business-critical functions, or the “core centers of gravity,” inside a trades business: CRM (customer relationship management, including sales enablement, marketing automation and customer service), FSM (field service management, including scheduling and dispatching), ERP (enterprise resource planning, including inventory), HCM (human capital management, including compensation and payroll integration) and FinTech (including payments and third-party consumer financing). By offering interoperable capabilities in all five centers of gravity, we continuously capture comprehensive data insights across key workflows in a trades business.
Previous wording
Our platform is differentiated by our close customer proximity and deep connection with the trades industry, which enables us to make real-time, evidence-based recommendations to our customers, augmented by the vast amounts of data that we synthesize into best practices. Our platform enables impactful outcomes for our customers, including accelerating revenue and driving operational efficiency, all while improving the experience for both end customers and contractors. As customers experience the significant business acceleration benefits of our platform, we have often observed our customers hire more technicians, increase gross transaction volume (“GTV”), representing total dollars invoiced by our customers to end customers through our platform, and adopt more add-on products. Increased customer adoption of our platform leads to further data and insights, allowing us to build more differentiated features and address opportunities in new trades, use cases and customer subsegments. All of this allows us to drive more growth and efficiency for customers, delivering outsized return on investment (“ROI”), in our products. In fiscal 2025 and fiscal 2024, we processed $68.5 billion and $55.7 billion of GTV, respectively.
Current wording
Our platform is differentiated by our close customer proximity and deep connection with the trades industry, which enables us to make real-time, evidence-based recommendations to our customers, augmented by the vast amounts of data that we synthesize into best practices. Our platform enables impactful outcomes for our customers, including accelerating revenue and driving operational efficiency, all while improving the experience for both end customers and contractors. As customers experience the significant business acceleration benefits of our platform, we have often observed our customers hire more technicians, increase gross transaction volume (“GTV”), representing total dollars invoiced by our customers through our platform, and adopt more add-on products. Increased customer adoption of our platform leads to further data and insights, allowing us to build more differentiated features and address opportunities in new trades, use cases and customer subsegments. All of this allows us to drive more growth and efficiency for customers, delivering considerable return on investment (“ROI”), in our products. In fiscal 2026 and fiscal 2025, we processed $82.1 billion and $68.5 billion of GTV, respectively.
Previous wording
Increase GTV By Serving Additional Customers in Existing Trades and Markets. Our ability to increase GTV also depends on our ability to serve additional customers in existing trades and markets. As our platform has deepened and expanded in features, we have been able to serve larger customers. The trades industry is also experiencing an influx of professional operators, including private equity owners, who are investing in and consolidating the trades, in many cases on our platform. Because of these dynamics, we focus on increasing the GTV on our platform, rather than new customer count. We believe our market opportunity is substantial, and we expect to continue to make significant investments across all aspects of our business to continue to increase the GTV on our platform.
Current wording
Increase GTV By Serving Additional Customers in Existing Trades and Markets. Increasing our GTV also depends on our ability to serve additional customers in existing trades and markets. As our platform has deepened and expanded in features, we have been able to serve larger customers. The trades industry is also experiencing an influx of professional operators, including private equity owners, who are investing in and consolidating trades businesses, in many cases on our platform. Because of these dynamics, we focus on increasing the GTV on our platform, rather than new customer count. We believe our market opportunity is substantial, and we expect to continue to make significant investments across all aspects of our business to continue to increase the GTV on our platform.
Previous wording
We designed our platform to address key workflows within a trades business. In contrast, existing solutions are difficult to adopt and resource-intensive to stitch together in a manner that would address multiple workflows and generate return on investment for trades businesses. This gives us a substantial opportunity to continue to invest in our platform and in our sales and marketing efforts to add more customers in, or help existing customers expand into, the expansive set of trade verticals we have penetrated so far. We also believe that there is further potential to expand our customer base by productizing additional capabilities for these trade verticals.
Current wording
We designed our platform to address key workflows within a trades business. In contrast, existing solutions are difficult to adopt and resource-intensive to stitch together in a manner that would address multiple workflows and generate return on investment for trades businesses. This gives us a substantial opportunity to continue to invest in our platform and in our sales and marketing efforts to add more customers in, or help existing customers expand into, the expansive set of trade verticals we have penetrated so far. We also believe that there is further potential to expand our customer base by productizing additional capabilities for these trade verticals, particularly AI-powered capabilities.
Previous wording
Build New Products to Extend Our Platform. We have a culture of significant innovation evidenced by the extension of our platform’s capabilities over time, producing new workflows across trades. We intend to continue to judiciously invest in research and development to expand the functionality of our platform, to develop new add-on products and to broaden our capabilities to address new market opportunities across trades. Powering key workflows of our customers through our Core product positions us to deliver value-added Pro and FinTech products that complement our Core product. We build Pro and FinTech products as an integrated add-on to our expansive Core product offering to deliver our customers business outcomes in a way that we believe no individual, standalone point solution can. As we continue to innovate and execute on our product roadmap, we believe customers will continue to find our new products additive and therefore continue to adopt them. We believe that there is further potential to expand our market opportunity by building new products to earn an even greater potential share of our customers’ GTV in the future. While our engrained industry position and exposure to the trades facilitate efficient product development opportunities, innovating new products will continue to require substantial time and research and development resources.
Current wording
Build and Bundle New Products to Extend Our Platform. We have a culture of significant innovation evidenced by the extension of our platform’s capabilities over time, producing new workflows across trades. We intend to continue to judiciously invest in research and development to expand the functionality of our platform, to develop and bundle new add-on products and to broaden our capabilities to address new market opportunities across trades. Powering key workflows of our customers through our Core product positions us to deliver value-added Pro, FinTech and other AI-powered products that complement our Core product. We build Pro and FinTech products as an integrated add-on to our expansive Core product offering to deliver our customers business outcomes in a way that we believe no individual, standalone point solution can. As we continue to innovate and execute on our product roadmap, we believe customers will continue to find our new products additive and therefore continue to adopt them. We believe that there is further potential to expand our market opportunity by building new products, particularly those powered by AI, to earn an even greater potential share of our customers’ GTV in the future. While our engrained industry position and exposure to the trades facilitate efficient product development opportunities, innovating new products will continue to require substantial time and research and development resources.
Previous wording
We offer tiered subscription plans for our Core and Pro products with varying contract lengths. Pursuant to these subscription contracts our customers do not have the ability to take possession of our proprietary software. For new customers, we primarily enter into either annual or multi-year subscription agreements with contract terms typically ranging from 12 to 36 months; however, certain Pro product and legacy customers are on month-to-month contracts. In nearly all cases, these contracts (monthly, annual, or multi-year) are renewed automatically unless cancelled in advance. We generally bill our customers on a monthly basis in advance of services, regardless of contract term. In some cases for certain products, the customer is billed in arrears. Pricing for these subscriptions are driven by the features included in the package and are linked to the size of the customer’s business, generally based on the number of field technicians at the customer but in some cases directly tied to the number of end customers or the customer’s revenue. In this way, our success is linked to the growth of our customers, which we measure through our net dollar retention rate. Our net dollar retention rate was over 110% for each of the fiscal years ended January 31, 2025, 2024 and 2023.1
Current wording
We offer tiered subscription plans for our Core and Pro products with varying contract lengths. Pursuant to these subscription contracts our customers do not have the ability to take possession of our proprietary software. For new customers, we primarily enter into either annual or multi-year subscription agreements with contract terms typically ranging from 12 to 36 months; however, certain Pro product and legacy customers are on month-to-month contracts. In nearly all cases, these contracts (monthly, annual, or multi-year) are renewed automatically unless cancelled in advance. We generally bill our customers on a monthly basis in advance of services, regardless of contract term. In some cases for certain products, the customer is billed in arrears. Pricing for these subscriptions are driven by the features included in the package and are linked to the size of the customer’s business, generally based on the number of field technicians at the customer but in some cases directly tied to the number of end customers or the customer’s revenue. In this way, our success is linked to the growth of our customers, which we measure through our net dollar retention rate. Our net dollar retention rate 2 was over 110% for each of the fiscal years ended January 31, 2026, 2025 and 2024.
Previous wording
1 Our net dollar retention rate measures the increase in annualized billings across our existing customer base by comparing the annualized billings from the same set of customers across comparable periods. To calculate our net dollar retention rate as of a given quarter, we first calculate annualized billings from the cohort of all customers billed in the same quarter in the prior year (the “prior period annualized billings”). We then calculate annualized billings from these same customers as of the current quarter (the “current period annualized billings”). Current period annualized billings includes the effect of any expansion, contraction or churn over the trailing 12 months. We divide (a) current period annualized billings by (b) prior period annualized billings to arrive at the net dollar retention rate. When calculating net dollar retention rate, we do not include the billings from any customers that were acquired as the result of our acquisition of a business until the completion of the first full quarter following the one-year anniversary of the acquisition.
Current wording
2 Our net dollar retention rate measures the increase in annualized billings across our existing customer base by comparing the annualized billings from the same set of customers across comparable periods. To calculate our net dollar retention rate as of a given quarter, we first calculate annualized billings from the cohort of all customers billed in the same quarter in the prior year (the “prior period annualized billings”). We then calculate annualized billings from these same customers as of the current quarter (the “current period annualized billings”). Current period annualized billings includes the effect of any expansion, contraction or churn over the trailing 12 months. We divide (a) current period annualized billings by (b) prior period annualized billings to arrive at the net dollar retention rate. When calculating net dollar retention rate, we do not include the billings from any customers that were acquired as the result of our acquisition of a business until the completion of the first full quarter following the one-year anniversary of the acquisition.
Previous wording
Usage-based services primarily consist of payment processing where we connect to third-party processors to allow our customers to accept payments, primarily credit and debit cards, and also includes end-customer financing solutions and other forms of payment. The third-party processor determines the eligibility of the end customer to participate in the programs, provides the payment settlement and financing options to the end customer and is responsible for the provision of the payment or financing services. We receive a fee from the third-party processors, depending on the size and type of the transaction, which we recognize net of interchange and other direct expenses which are passed onto the customer. Revenue from financing and processing payments is recognized at the time of the transaction. In addition to payment processing revenue, we have a number of Pro products that generate revenue depending on the level of usage, which we recognize monthly in arrears based on consumption.
Current wording
Usage-based services primarily consist of payment processing where we connect to third-party processors to allow our customers to accept payments, primarily credit and debit cards, and also includes end-customer financing solutions and other forms of payment. The third-party processor determines the eligibility of the end customer to participate in the programs, provides the payment settlement and financing options to the end customer and is responsible for the provision of the payment or financing services. We receive a fee from the third-party processors, depending on the size and type of the transaction, which we recognize net of interchange and other direct expenses which are passed onto the customer. Revenue from financing and processing payments is recognized at the time of the transaction. In addition to payment processing revenue, we have a number of Pro products that generate revenue depending on the level of usage, which we recognize monthly in arrears based on consumption. Usage revenue also includes fees we earn from third-party partners based on transactions or customer activity facilitated through our platform, which we recognize in the period in which the underlying activity occurs. In addition, usage-based revenue also include revenue from our Virtual Agents, which is consumption-based and recognized in the period in which the underlying usage occurs.
Previous wording
We expect our cost of platform revenue to increase in absolute dollars as the adoption and usage of our platform and product offerings increase. In addition, we expect our platform cost of revenue to decrease as a percentage of revenue resulting from a portion of our customer success personnel changing roles to sales and marketing activities at the beginning of fiscal 2026 as we shift the customer success function to focus on both customer retention and also customer expansion.
Current wording
We expect our cost of platform revenue to increase in absolute dollars as the adoption and usage of our platform and product offerings increase.
Previous wording
Sales and marketing expense consists primarily of personnel-related costs, consulting costs and other costs incurred in connection with our sales and marketing and certain customer success efforts. Personnel-related costs primarily include salary, commissions, employee benefits, bonuses and stock-based compensation for our outbound sales personnel that focus on new customer acquisition and for our customer success personnel that focus on expanding adoption of our products at existing customers. Sales and marketing expense also includes marketing and advertising expenses, such as our annual customer conferences, Pantheon and Ignite, and travel and trade show expenses, amortization of acquired customer intangible assets and allocated overhead. Our annual customer conferences are significant sales and marketing events, so we therefore expect an increase in sales and marketing expense during the fiscal third quarter when they occur. We expect that sales and marketing expense will increase on an absolute dollar basis as we invest to grow our business. We plan to continue to expand sales and marketing efforts to attract new customers, retain existing customers and increase revenue from both new and existing customers by adding outbound sales personnel.
Current wording
Sales and marketing expense consists primarily of personnel-related costs, consulting costs and other costs incurred in connection with our sales and marketing and certain customer success efforts. Personnel-related costs primarily include salary, commissions, employee benefits, bonuses and stock-based compensation for our outbound sales personnel that focus on new customer acquisition and for our customer success personnel that focus on expanding adoption of our products at existing customers. Sales and marketing expense also includes marketing and advertising expenses, such as our annual customer conferences, Pantheon and Ignite, and travel and trade show expenses, amortization of acquired customer intangible assets and allocated overhead. Our annual customer conferences are significant sales and marketing events, so we therefore expect an increase in sales and marketing expense during the fiscal third quarter when they occur. We expect that sales and marketing expense will increase on an absolute dollar basis as we invest to grow our business. We plan to continue to expand sales and marketing efforts to attract new customers, retain existing customers and increase revenue from both new and existing customers by adding sales personnel.
Previous wording
General and administrative expense consists primarily of personnel-related costs for our executive, finance, legal, information systems, operations and human resource teams. Personnel-related costs primarily include salary, employee benefits, bonuses and stock-based compensation. General and administrative expense also includes professional fees, other outside consulting expenses, acquisition-related expenses and allocated overhead. We expect that general and administrative expense will increase on an absolute dollar basis, but over time decrease as a percentage of total revenue, as we focus on the efficiency of our processes and systems that will enable our internal support functions to scale with the growth of our business. We expect increases to general and administrative expense to support our growth and as we incur the costs of compliance associated with being a public company, including increased accounting and legal expenses.
Current wording
General and administrative expense consists primarily of personnel-related costs for our executive, finance, legal, information systems, operations and human resource teams. Personnel-related costs primarily include salary, employee benefits, bonuses and stock-based compensation. General and administrative expense also includes professional fees, other outside consulting expenses, acquisition-related expenses and allocated overhead. We expect that general and administrative expense will increase on an absolute dollar basis, but over time decrease as a percentage of total revenue, as we focus on the efficiency of our processes and systems that will enable our internal support functions to scale with the growth of our business. We expect increases to general and administrative expense to support our growth and as we continue to incur the costs of compliance associated with being a public company, including increased accounting and legal expenses.
Previous wording
Other expense, net, consists primarily of interest expense related to our debt arrangements with financial institutions, interest income earned on our cash and cash equivalents, gains or losses on foreign currency transactions and miscellaneous other income.
Current wording
Other income (expense), net, consists primarily of interest expense related to our debt arrangements with financial institutions, interest income earned on our cash and cash equivalents, gains or losses on foreign currency transactions and miscellaneous other income.
Previous wording
For a discussion of our consolidated statement of operations data for the fiscal 2024 compared to fiscal 2023, refer to the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Prospectus filed with the SEC pursuant to Rule 424(b)(4) under the Securities Act of 1933, as amended, on December 11, 2024.
Current wording
For a discussion of our consolidated statement of operations data for fiscal 2025 compared to fiscal 2024, refer to the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the fiscal year ended January 31, 2025 filed with the SEC on April 2, 2025, which is incorporated by reference herein.
Previous wording
Platform revenue increased by $157.7 million, or 27%, for fiscal 2025, compared to fiscal 2024. This increase was primarily driven by subscription revenue, which increased by $124.2 million, or 28%, for fiscal 2025, compared to fiscal 2024. In addition, revenue from our usage-based products increased by $33.5 million, or 24%, for fiscal 2025, compared to fiscal 2024. This increase was primarily driven by increases in both the volume and value of payment transactions processed using our FinTech offerings.
Current wording
Platform revenue increased by $185.9 million, or 25%, for fiscal 2026, compared to fiscal 2025. This increase was primarily driven by subscription revenue, which increased by $146.6 million, or 26%, for fiscal 2026, compared to fiscal 2025. In addition, revenue from our usage-based products increased by $39.3 million, or 23%, for fiscal 2026, compared to fiscal 2025. This increase was primarily driven by increases in gross transaction volume and a higher earn rate generated on that volume.
Previous wording
Sales and marketing expense increased by $33.4 million, or 15%, for fiscal 2025, compared to fiscal 2024. The increase in sales and marketing expense was primarily driven by an increase of $25.6 million in personnel-related costs related to an increase in headcount, including an increase of $4.2 million in commissions and an increase of $3.5 million in stock-based compensation. We also recorded a $6.0 million increase in impairment losses on operating lease assets and related property and equipment for a portion of our headquarters space that weceased to useduring fiscal 2025 compared to fiscal 2024. Additionally, marketing and advertising costs increased $3.3 million. These were partially offset by a decrease of $1.4 million of restructuring costs related to our reductions in workforce.
Current wording
Sales and marketing expense increased by $37.5 million, or 15%, for fiscal 2026, compared to fiscal 2025. The increase in sales and marketing expense was primarily driven by an increase of $28.9 million in personnel-related costs, which included increased headcount, an increase of $5.3 million in sales commissions, and an increase of $1.1 million in stock-based compensation. There was an additional increase of $6.5 million in marketing and advertising costs and an increase of $5.5 million in employee benefit expenses primarily related to health insurance. These increases were partially offset by a decrease of $4.6 million in impairment losses on operating lease assets and related property and equipment for office spaces that we ceased to use.
Previous wording
Other expense, net, decreased by $1.3 million, or 16%, for fiscal 2025, compared to fiscal 2024, primarily due to an increase of $1.7 million in interest income related to our higher cash balance and a decrease of $0.9 million in interest expense due to the restructuring of our debt in fiscal 2025. These were partially offset by $1.0 million of government grants related to our operations in Armenia in fiscal 2024.
Current wording
Other income (expense), net, increased by $18.9 million for fiscal 2026, compared to fiscal 2025, primarily due to an increase of $10.5 million in interest income related to our higher cash balance and a decrease of $8.3 million in interest expense due tothe restructuring of our debt and repayment ofour Revolver Facility that occurred in fiscal 2025.
Previous wording
Our provision for income taxes decreased by $1.8 million, or 44%, for fiscal 2025, compared to fiscal 2024. The change is primarily driven by income earned by our foreign subsidiaries. For additional detail, see Note 14 to our consolidated financial statements included in this Annual Report.
Current wording
Our provision for income taxes increased by $0.4 million, or 18%, for fiscal 2026, compared to fiscal 2025. The change is primarily driven by the deferred tax expense from the amortization of indefinite-lived tax amortizable goodwill. For additional detail, see Note 14 to our consolidated financial statements included in this Annual Report.
Previous wording
Loss on operating lease assets. In fiscal 2024 and fiscal 2025, we incurred impairments on certain right-of-use assets and other long-lived assets. See Note 4 of our audited consolidated financial statements included in this Annual Report. We believe that it is useful to exclude these charges when assessing the level of various operating expenses and resource allocations when budgeting, planning and forecasting future periods. In addition, we believe excluding such costs enhances the comparability between periods.
Current wording
Loss on operating lease assets. In fiscal 2024, fiscal 2025 and fiscal 2026, we incurred impairments on certain right-of-use assets and other long-lived assets. See Note 4 of our audited consolidated financial statements included in this Annual Report. We believe that it is useful to exclude these charges when assessing the level of various operating expenses and resource allocations when budgeting, planning and forecasting future periods. In addition, we believe excluding such costs enhances the comparability between periods.
Previous wording
Non-GAAP Income (Loss) from Operations and Non-GAAP Operating Margin
Current wording
Non-GAAP Income from Operations and Non-GAAP Operating Margin
Previous wording
This amount represents adjustments for the current and deferred income tax effects on non-GAAP net income (loss) for the impact of the non-GAAP adjustments above.
Current wording
This amount represents adjustments for the current and deferred income tax effects on non-GAAP net income for the impact of the non-GAAP adjustments above.
Previous wording
As of January 31, 2025, we had cash and cash equivalents of $441.8 million, which excludes restricted cash of $1.0 million, and $140.0 million available under the Credit Agreement, as defined below. Cash and cash equivalents consisted of checking accounts and money market funds with maturities less than 90 days from the date of purchase. Our liquidity is subject to various risks including the risks set forth in the section titled “Risk Factors” and the market risks identified in the section titled “Quantitative and Qualitative Disclosures about Market Risk.”
Current wording
As of January 31, 2026, we had cash and cash equivalents of $428.8 million, which excludes restricted cash of $0.6 million, and $250.0 million available under the Amended Credit Agreement, as defined below. Cash and cash equivalents consisted of checking accounts and money market funds with maturities less than 90 days from the date of purchase. Our liquidity is subject to various risks including the risks set forth in the section titled “Risk Factors” and the market risks identified in the section titled “Quantitative and Qualitative Disclosures about Market Risk.”
Previous wording
We believe that our existing cash and cash equivalents, cash available under our Credit Agreement, and cash receipts from our revenue arrangements will be sufficient to support working capital, operating lease payments and capital expenditure requirements for at least 12 months from the date of this Annual Report. Our future capital requirements and the adequacy of available funds will depend on many factors, including those set forth in the section titled “Risk Factors.” Further, in the future we may enter into arrangements to acquire or invest in businesses, products, services and technologies. We may be required to seek additional equity or debt financing. In the event that additional financing is required from outside sources, we cannot be sure that any additional financing will be available to us on acceptable terms if at all. If we are unable to raise additional capital when desired, our business, results of operations and financial condition could be adversely affected.
Current wording
We believe that our existing cash and cash equivalents, cash available under our Amended Credit Agreement, and cash receipts from our revenue arrangements will be sufficient to support working capital, operating lease payments and capital expenditure requirements for at least 12 months from the date of this Annual Report. Our future capital requirements and the adequacy of available funds will depend on many factors, including those set forth in the section titled “Risk Factors.” Further, in the future we may enter into arrangements to acquire or invest in businesses, products, services and technologies. We may be required to seek additional equity or debt financing. In the event that additional financing is required from outside sources, we cannot be sure that any additional financing will be available to us on acceptable terms if at all. If we are unable to raise additional capital when desired, our business, results of operations and financial condition could be adversely affected.
Previous wording
Net cash used in operating activities was $39.7 million in fiscal 2024. This primarily related to our net loss of $195.1 million, adjusted for non-cash charges of $208.2 million and net cash outflows of $52.7 million for changes in our operating assets and liabilities. The primary drivers of the changes in our operating assets and liabilities relate to an increase in deferred contract costs of $12.6 million, an increase in contract assets of $11.8 million, a decrease in lease liability of $9.2 million, an increase in accounts receivable of $7.8 million, a decrease in accounts payable and accrued operating expenses, accrued personnel-related expenses and other liabilities of $6.4 million, and an increase in prepaid and other assets of $5.2 million. The changes in our operating assets and liabilities are primarily due to the growth of our business, timing of cash receipts from customers, timing of cash payments to our vendors and timing of payroll.
Current wording
Net cash provided by operating activities was $110.1 million for fiscal 2026. This primarily related to our non-cash charges of $324.9 million, adjusted for our net loss of $159.9 million and net cash outflows of $54.9 million from changes in our operating assets and liabilities. The primary drivers of the changes in our operating assets and liabilities related to an increase in deferred contract costs of $22.4 million, an increase in accounts receivable of $20.8 million due to the increase in revenue, a decrease in operating lease liabilities of $12.0 million, and an increase in contract assets of $11.9 million. These were partially offset by an increase in accounts payable and accrued expenses of $12.1 million and an increase in accrued personnel related expenses of $2.7 million.
Previous wording
Net cash provided by operating activities was $37.1 million for fiscal 2025. This primarily related to our non-cash charges of $306.2 million, adjusted for our net loss of $239.1 million and net cash outflows of 30.0 million from changes in our operating assets and liabilities. The primary drivers of the changes in our operating assets and liabilities related to an increase in deferred contract costs of $15.8 million and contract assets of $6.6 million, an increase in accounts receivable of $17.7 million due to the increase in revenue, a decrease in accounts payable and other accrued expenses of $9.0 million due to the payment of deferred offering costs related to our IPO, and a decrease of lease liabilities of $9.4 million. These were partially offset by an increase in accrued personnel related expenses of $23.2 million due to an increase in headcount and bonus achievement, an increase in deferred revenue of $3.3 million, and an increase in other liabilities of $2.1 million.
Current wording
Net cash provided by operating activities was $37.1 million for fiscal 2025. This primarily related to our non-cash charges of $306.2 million, adjusted for our net loss of $239.1 million and net cash outflows of $30.0 million from changes in our operating assets and liabilities. The primary drivers of the changes in our operating assets and liabilities related to an increase in deferred contract costs of $15.8 million and contract assets of $6.6 million, an increase in accounts receivable of $17.7 million due to the increase in revenue, a decrease in accounts payable and other accrued expenses of $9.0 million due to the payment of deferred offering costs related to our IPO, and a decrease of operating lease liabilities of $9.4 million. These were partially offset by an increase in accrued personnel related expenses of $23.2 million due to an increase in headcount and bonus achievement, an increase in deferred revenue of $3.3 million, and an increase in other liabilities of $2.1 million.
Previous wording
Net cash used in investing activities was $40.3 million for fiscal 2024. This consisted of cash outflows relating to $28.4 million for the purchase of property and equipment primarily related to improvements to our headquarters and other facilities and $15.7 million for the investments in capitalized internal-use software, partially offset by the proceeds from the sale of intangible assets of $2.7 million and the repayment of an employee loan of $1.5 million.
Current wording
Net cash used in investing activities was $44.8 million for fiscal 2026. This consisted of cash outflows of $19.9 million for investments in capitalized internal-use software, $19.8 million of cash paid, net of cash acquired, for the acquisition of Conduit, $4.7 million for the purchase of property and equipment, and $0.5 million in deposits for property and equipment.
Previous wording
Our audited consolidated financial statements and the related notes thereto included elsewhere in this Annual Report are prepared in accordance with GAAP. The preparation of consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, costs and expenses and related disclosures. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. Actual results could differ significantly from our estimates.
Current wording
Our management’s discussion and analysis of financial condition and results of operations is based on our consolidated financial statements and the related notes thereto, which are prepared in accordance with GAAP. The preparation of these consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, costs and expenses and related disclosures. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances at the time the estimate is made. Actual results could differ significantly from our estimates.
Previous wording
We believe that the accounting policies described below involve a significant degree of judgment and complexity. Accordingly, we believe these are the most critical to aid in fully understanding and evaluating our consolidated financial condition and results of operations. For further information of the below critical accounting policies and estimates and our other significant accounting policies, see Note 2 to our audited consolidated financial statements included elsewhere in this Annual Report.
Current wording
The significant accounting policies and methods used in the preparation of our consolidated financial statements are discussed in Note 2 to our consolidated financial statements included in Item 8 of this Annual Report on Form 10-K. The accounting policies described below include accounting estimates that may involve a significant degree of judgment and complexity, and accordingly, we believe these are the most critical to aid in fully understanding and evaluating our consolidated financial condition and results of operations.
Previous wording
Revenue recognition represents an important accounting policy to the understanding of our financial condition and results of operations. Our revenue recognition may require the use of significant judgment in determining whether services are considered distinct performance obligations that should be accounted for separately and determining estimated standalone selling prices for the purposes of allocating the transaction price to distinct performance obligations. For information regarding our revenue recognition accounting policy, see Note 2 to our audited consolidated financial statements included elsewhere in this Annual Report.
Current wording
Revenue recognition represents an important accounting policy to the understanding of our financial condition and results of operations. Our revenue recognition may require the use of significant judgment in determining whether services are considered distinct performance obligations that should be accounted for separately and determining estimated standalone selling prices for the purpose of allocating the transaction price to distinct performance obligations. For information regarding our revenue recognition accounting policy, see Note 2 to our audited consolidated financial statements included elsewhere in this Annual Report.
Previous wording
The common stock value used in determining the grant date fair value of awards granted after our IPO are based on our stock price as reported on the Nasdaq on the date of grant.
Current wording
The value of our common stock is the primary input used to measure the grant date fair value of our stock-based awards. The common stock value used in determining the grant date fair value of awards granted after our IPO is based on our stock price as reported on the Nasdaq on the date of grant.
Previous wording
Accounting for acquisitions represents a critical accounting policy. For information regarding our acquisition accounting policy, see Note 2 to our audited consolidated financial statements included elsewhere in this Annual Report. Determining the fair value of assets acquired and liabilities assumed requires management to make judgments and estimates, including the selection of valuation methodologies, assumptions used in future revenue, cost and cash flow forecasts and selection of comparable companies. We engage the assistance of valuation specialists in concluding on fair value measurements in connection with determining fair values of assets acquired and liabilities assumed in a business combination. While we use our best estimates and judgments, estimates are inherently uncertain and subject to refinement. The valuation of intangible assets, primarily customer relationships and developed technology, includes estimates that are critical accounting estimates. These critical estimates are primarily those relating to forecasted growth rates, customer retention rates and obsolescence rates of acquired technology. We base these estimates using information available regarding historical trends and future industry conditions and macroeconomic events, and judgments regarding the replacement and obsolescence of acquired technologies, among other factors.
Current wording
Determining the fair value of assets acquired and liabilities assumed requires management to make judgments and estimates, including the selection of valuation methodologies, assumptions used in revenue, cost and cash flow forecasts and selection of comparable companies. We engage the assistance of valuation specialists in concluding on fair value measurements in connection with determining fair values of assets acquired and liabilities assumed in business combinations. While we use our best estimates and judgments, estimates are inherently uncertain and subject to refinement. The valuation of intangible assets, primarily customer relationships and developed technology, includes estimates that are critical accounting estimates. These critical estimates are primarily those relating to forecasted growth rates, customer retention rates and obsolescence rates of acquired technology. We base these estimates using information available regarding historical trends and future industry conditions and macroeconomic events, and judgments regarding the replacement and obsolescence of acquired technologies, among other factors.