Tenable Holdings, Inc.

Previous wording

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with (1) our consolidated financial statements and related notes included elsewhere in this Quarterly Report on Form 10-Q, or this Form 10-Q, and (2) our consolidated financial statements, related notes and management's discussion and analysis of financial condition and results of operations in our Annual Report on Form 10-K for the year ended December 31, 2025, or the 10-K, filed with the Securities and Exchange Commission, or the SEC, on February 27, 2026. This Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act. These statements are often identified by the use of words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “project,” “will,” “would” or the negative or plural of these words or similar expressions or variations. Such forward-looking statements are subject to a number of risks, uncertainties, assumptions and other factors that could cause actual results and the timing of certain events to differ materially from future results expressed or implied by the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those identified herein, and those discussed in the section titled “Risk Factors,” set forth in Part I, Item IA of the 10-K, in Part II, Item 1A of this Form 10-Q and in our other filings with the SEC. You should not rely upon forward-looking statements as predictions of future events. Furthermore, such forward-looking statements speak only as of the date of this report. Except as required by law, we undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date of such statements.

Current wording

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with (1) our consolidated financial statements and related notes included elsewhere in this Quarterly Report on Form 10-Q, or this Form 10-Q, and (2) our consolidated financial statements, related notes and management's discussion and analysis of financial condition and results of operations in our Annual Report on Form 10-K for the year ended December 31, 2025, or the 10-K, filed with the Securities and Exchange Commission, or the SEC, on February 27, 2026. This Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act. These statements are often identified by the use of words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “project,” “will,” “would” or the negative or plural of these words or similar expressions or variations. Such forward-looking statements are subject to a number of risks, uncertainties, assumptions and other factors that could cause actual results and the timing of certain events to differ materially from future results expressed or implied by the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those identified herein, and those discussed in the section titled “Risk Factors,” set forth in Part I, Item 1A of the 10-K, in Part II, Item 1A of this Form 10-Q and in our other filings with the SEC. You should not rely upon forward-looking statements as predictions of future events. Furthermore, such forward-looking statements speak only as of the date of this report. Except as required by law, we undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date of such statements.

Previous wording

Recurring revenue, which includes revenue from subscription arrangements for software (both recognized ratably over the subscription term and upon delivery) and cloud-based solutions and maintenance associated with perpetual licenses, represented 96% of revenue in the three months ended March 31, 2026 and 2025.

Current wording

Recurring revenue, which includes revenue from subscription arrangements for software (both recognized ratably over the subscription term and upon delivery) and cloud-based solutions and maintenance associated with perpetual licenses, represented 95% of revenue in the three months ended June 30, 2026 and 96% of revenue in the three months ended June 30, 2025 and the six months ended June 30, 2026 and 2025.

Previous wording

We typically experience seasonality in customer agreement volumes, entering into a significantly higher percentage of new and renewal agreements in the third and fourth quarters of the year. The increase in the third quarter is primarily driven by U.S. government and related agencies, and the increase in the fourth quarter reflects typical large enterprise buying patterns in the software industry. Although the ratable nature of our subscription revenue lessens the financial impact, these historical trends may be impacted by macroeconomic conditions and U.S. policy decisions, which may lengthen purchasing and approval phases of our sales cycle in 2026.

Current wording

We typically experience seasonality in customer agreement volumes, entering into a significantly higher percentage of new and renewal agreements in the third and fourth quarters of the year. The increase in the third quarter is primarily driven by U.S. government and related agencies, and the increase in the fourth quarter reflects typical large enterprise buying patterns in the software industry. Although the ratable nature of our subscription revenue lessens the financial impact, these historical trends may be impacted by macroeconomic conditions and U.S. policy decisions, which may lengthen purchasing and approval phases of our sales cycle.

Previous wording

(2) Stock-based compensation in the three months ended March 31, 2025 includes $14.6 million of expense related to the accelerated vesting of equity awards for our former Chairman and Chief Executive Officer.

Current wording

(2) Stock-based compensation in the six months ended June 30, 2025 includes $14.6 million of expense related to the accelerated vesting of equity awards for our former Chairman and Chief Executive Officer.

Previous wording

•a $1.0 million increase in third-party cloud infrastructure costs;

Current wording

•a $1.0 million increase in professional services.

Previous wording

•a $0.5 million increase in expenses for demand generation programs, including advertising, sponsorships, and brand awareness efforts; partially offset by

Current wording

•a $2.2 million decrease in demand generation programs, including advertising, sponsorships, and brand awareness efforts; partially offset by

Previous wording

•a $1.3 million increase in sales commissions,

Current wording

•a $1.1 million increase in sales commissions.

Previous wording

•$2.1 million of discrete items primarily related to withholding taxes on sales to customers; and

Current wording

•$1.9 million of discrete items primarily related to withholding taxes on sales to customers; and

Previous wording

The increase in revenue included an increase of $24.8 million from existing customers as of April 1, 2025, partially offset by a decrease of $1.9 million in revenue from new customers. U.S. revenue increased $9.5 million, or 7%. International revenue increased $13.4 million, or 12%.

Current wording

The increase in revenue included an increase of $48.3 million from existing customers as of July 1, 2025, partially offset by a decrease of $4.2 million in revenue from new customers. U.S. revenue increased $16.8 million, or 7%. International revenue increased $27.3 million, or 12%.

Previous wording

•a $2.6 million increase in personnel costs; and

Current wording

•a $2.6 million increase in personnel costs;

Previous wording

•a $1.3 million increase in personnel costs;

Current wording

•a $1.3 million increase in hardware costs.

Previous wording

•a $2.3 million increase in personnel costs, including a $0.8 million increase in stock-based compensation;

Current wording

•a $2.4 million increase in personnel costs, including a $0.9 million increase in stock-based compensation; and

Previous wording

•a $0.6 million increase in allocated overhead expenses, and

Current wording

•a $1.5 million increase in allocated overhead;

Previous wording

•a $13.2 million decrease in personnel costs, including a $12.9 million decrease in stock-based compensation primarily related to the accelerated vesting of equity awards for our former Chairman and Chief Executive Officer in the three months ended March 31, 2025; and

Current wording

•a $12.8 million decrease in personnel costs primarily related to the accelerated vesting of equity awards for our former Chairman and Chief Executive Officer in the six months ended June 30, 2025;

Previous wording

The $1.9 million decrease in interest income was due to decreased rates of return of short-term investments. Interest expense decreased $0.6 million due to a decrease in the interest rate on our Term Loan. Other expense increased $0.8 million primarily due to an increase in foreign exchange losses.

Current wording

The $3.7 million decrease in interest income was due to a decrease in short-term investments and reduced rates of return. Interest expense decreased $1.3 million due to a decrease in the interest rate on our Term Loan. Other income (expense), net decreased $2.1 million primarily due to an increase in foreign exchange losses.

Previous wording

At March 31, 2026, we had $139.2 million of cash and cash equivalents, which consisted of bank deposits and money market funds, and $221.1 million of short-term investments, which consisted of commercial paper, asset backed securities, U.S. Treasury and agency obligations and corporate and Yankee bonds.

Current wording

At June 30, 2026, we had $125.4 million of cash and cash equivalents, which consisted of bank deposits and money market funds, and $172.9 million of short-term investments, which consisted of commercial paper, asset backed securities, U.S. Treasury and agency obligations and corporate and Yankee bonds.

Previous wording

We have historically generated significant operating losses, as reflected by our accumulated deficit of $896.0 million at March 31, 2026.

Current wording

We have historically generated significant operating losses, as reflected by our accumulated deficit of $892.2 million at June 30, 2026.

Previous wording

We typically invoice our customers in advance, however multi-year subscriptions are increasingly being invoiced annually in installments. Deferred revenue consists primarily of the unearned portion of billed fees for our subscriptions and perpetual licenses, which is subsequently recognized as revenue in accordance with our revenue recognition policy. At March 31, 2026, we had deferred revenue of $866.2 million, of which $680.0 million was recorded as a current liability and is expected to be recognized as revenue in the next 12 months, provided all other revenue recognition criteria are met.

Current wording

We typically invoice our customers in advance, however multi-year subscriptions are increasingly being invoiced annually in installments. Deferred revenue consists primarily of the unearned portion of billed fees for our subscriptions and perpetual licenses, which is subsequently recognized as revenue in accordance with our revenue recognition policy. At June 30, 2026, we had deferred revenue of $849.4 million, of which $670.1 million was recorded as a current liability and is expected to be recognized as revenue in the next 12 months, provided all other revenue recognition criteria are met.

Previous wording

Our Board of Directors authorized the repurchase of up to $100 million of our common stock in November 2023 and subsequently increased the authorization by $200 million in October 2024, $250 million in July 2025 and $150 million in January 2026. Since the inception of the share repurchase program and through March 31, 2026, we have purchased a total of 16.7 million shares for $492.4 million.

Current wording

Our Board of Directors authorized the repurchase of up to $100 million of our common stock in November 2023 and subsequently increased the authorization by $200 million in October 2024, $250 million in July 2025 and $150 million in January 2026.

Previous wording

From January to March 2026, interest rates on our Term Loan were between 6.54% and 6.58%. The Term Loan is being amortized at 1% per annum in equal quarterly installments until the final payment of $350.6 million on the July 7, 2028 maturity date. We may be subject to mandatory Term Loan prepayments related to the excess cash provisions in the Credit Agreement if our first lien net leverage ratio (as defined in the Credit Agreement) exceeds 3.5. At March 31, 2026, our first lien net leverage ratio was 0.81.

Current wording

From January to June 2026, interest rates on our Term Loan were between 6.48% and 6.58%. The Term Loan is being amortized at 1% per annum in equal quarterly installments until the final payment of $350.6 million on the July 7, 2028 maturity date. We may be subject to mandatory Term Loan prepayments related to the excess cash provisions in the Credit Agreement if our first lien net leverage ratio (as defined in the Credit Agreement) exceeds 3.5. At June 30, 2026, our first lien net leverage ratio was 0.77.

Previous wording

Net cash used in investing activities decreased by $119.9 million, primarily due to a $148.5 million decrease in cash paid for acquisitions, partially offset by a $29.6 million net decrease in sales of short-term investments.

Current wording

Net cash provided by investing activities increased by $199.4 million, primarily due to a $196.2 million decrease in cash paid for acquisitions.

Previous wording

Net cash used in financing activities increased by $72.8 million, primarily due to a $70.2 million increase in repurchases of our common stock under our repurchase program.

Current wording

Net cash used in financing activities increased by $108.5 million, primarily due to a $105.2 million increase in repurchases of our common stock under our repurchase program.