Certara, Inc.

Previous wording

On April 21, 2026, the Company entered into a Purchase Agreement (the "Purchase Agreement") with Veristat, LLC to sell its global medical writing and related regulatory services business (the "Regulatory and Medical Writing business"). On May 8, 2026, the Company completed the sale of the Regulatory and Medical Writing business. The Company received cash consideration of $69.4 million, with an additional $15.0 million placed in escrow to be released to the Company upon the satisfaction of certain post-closing conditions. In addition, the Company is eligible to receive an earn-out payment of up to $35.0 million based on the financial performance (as defined in the Purchase Agreement) of such business over a specified period following closing. The transaction resulted in an estimated pretax loss on sale of $65.5 million, including an estimated after-tax loss of $48.6 million, which was recorded in loss from discontinued operations, in the condensed consolidated statement of operations for the three and six months ended June 30, 2026. The final loss recognized may differ from the amount currently recognized due to the final escrow amount realized and the ultimate settlement of the earn-out.

Current wording

On April 21, 2026, the Company entered into a Purchase Agreement (the "Purchase Agreement") with Veristat, LLC to sell its global medical writing and related regulatory services business (the "Regulatory and Medical Writing business"). On May 8, 2026, the Company completed the sale of the Regulatory and Medical Writing business. As of September 30, 2026, the Company had received cash consideration of $78.2 million. An additional $7.5 million, representing a decrease from $15.0 million as of June 30, 2026, remained held in escrow to be released to the Company upon the satisfaction of certain post-closing conditions. In addition, the Company is eligible to receive an earn-out payment of up to $35.0 million based on the financial performance (as defined in the Purchase Agreement) of such business over a specified period following closing. During the three months ended September 30, 2026, the Company recognized a pretax gain of $8.7 million related to the disposal, primarily resulting from the recognition of $7.5 million of additional consideration based on the Company's assessment that certain post-closing conditions under the Purchase Agreement were satisfied. The transaction resulted in an estimated pretax loss on sale of $56.7 million, including an estimated after-tax loss of $40.7 million, which was recorded in loss from discontinued operations, in the condensed consolidated statement of operations for the nine months ended September 30, 2026. The final loss recognized may differ from the amount currently recognized due to the final escrow amount realized and the ultimate settlement of the earn-out.

Previous wording

(g)Represents the gain or loss related to the disposal of fixed assets.

Current wording

(h)Represents the gain or loss related to the disposal of fixed assets.

Previous wording

(h)Represents recruiting, relocation expenses, and retention costs related to senior executives.

Current wording

(i)Represents recruiting, relocation expenses, and retention costs related to senior executives.

Previous wording

(i)Represents the income tax effect of the non-GAAP adjustments calculated using the applicable statutory rate by jurisdiction.

Current wording

(k)Represents the income tax effect of the non-GAAP adjustments calculated using the applicable statutory rate by jurisdiction.

Previous wording

(j)Represents potentially dilutive shares that were included from our GAAP diluted weighted average common shares outstanding.

Current wording

(l)Represents potentially dilutive shares that were included from our GAAP diluted weighted average common shares outstanding, to the extent such shares are not antidilutive.

Previous wording

The following results of operations present our continuing operations for the three and six months ended June 30, 2026 to the three and six months ended June 30, 2025, respectively. All results from the Regulatory and Medical Writing business are presented within income (loss) from discontinued operations for these periods.

Current wording

The following results of operations present our continuing operations for the three and nine months ended September 30, 2026 to the three and nine months ended September 30, 2025, respectively. All results from the Regulatory and Medical Writing business are presented within income (loss) from discontinued operations for these periods.

Previous wording

Total revenues increased by $0.9 million, or 1%, to $93.3 million for the three months ended June 30, 2026 as compared to the same period in 2025. Overall revenue growth was primarily driven by our software product offerings, supported by strong demand from existing customers and expansion of relationships with existing customers and new customers.

Current wording

Total revenues increased by $4.0 million, or 4%, to $94.9 million for the three months ended September 30, 2026 as compared to the same period in 2025. Overall revenue growth was primarily driven by our software product offerings, supported by strong demand from existing customers and expansion of relationships with existing customers and new customers.

Previous wording

Software revenues increased by $2.1 million, or 4%, to $48.8 million for the three months ended June 30, 2026 as compared to the same period in 2025, primarily driven by increased demand from existing customers and expanded relationships with existing customers.

Current wording

Software revenues increased by $5.0 million, or 11%, to $48.8 million for the three months ended September 30, 2026 as compared to the same period in 2025, primarily driven by increased demand from existing customers and expanded relationships with existing and new customers.

Previous wording

Services revenues decreased by $1.2 million to $44.5 million for the three months ended June 30, 2026 as compared to the same period in 2025.

Current wording

Services revenues decreased by $1.0 million to $46.1 million for the three months ended September 30, 2026 as compared to the same period in 2025.

Previous wording

General and administrative expenses increased by $5.2 million, or 31%, to $21.9 million for the three months ended June 30, 2026 as compared to the same period in 2025. The increase in general and administrative expenses was primarily due to a $5.7 million increase related to the remeasurement of the fair value of business acquisition contingent consideration, primarily due to the absence of a non-recurring favorable change recognized in the prior year that reduced expenses in that period, a $0.6 million increase in executive recruiting expenses, a $0.5 million increase in lease abandonment expense, and a $0.3 million increase in equipment and software expense, partially offset by a $1.1 million decrease in stock-based compensation costs, and a $0.8 million decrease in facility-lease related expense.

Current wording

General and administrative expenses increased by $2.8 million, or 11%, to $27.0 million for the three months ended September 30, 2026 as compared to the same period in 2025. The increase in general and administrative expenses was primarily due to a $3.6 million increase in employee-related costs, largely driven by a $2.5 million increase in reorganization expense, a $1.5 million increase in equipment and software expense, a $1.2 million increase in executive recruiting expenses, and a $0.8 million increase in professional and consulting expense, partially offset by a $2.7 million decrease related to the remeasurement of the fair value of business acquisition contingent consideration, a $1.1 million decrease in stock-based compensation costs, and a $0.4 million decrease in facility and lease related expense.

Previous wording

Depreciation and amortization expense increased by $1.3 million, or 6%, to $23,235 for the six months ended June 30, 2026 as compared to the same period in 2025. The increase in depreciation and amortization expense was primarily due to a $0.6 million net increase in amortization of intangible assets, primarily related to a $0.7 million increase in amortization of capitalized software. In addition, depreciation expense for fixed assets increased $0.6 million, primarily due to a $0.6 million increase in depreciation of computer equipment.

Current wording

Depreciation and amortization expense increased by $0.9 million, or 8%, to $11.8 million for the three months ended September 30, 2026 as compared to the same period in 2025. The increase in depreciation and amortization expense was primarily due to a $0.5 million increase in depreciation expense for fixed assets, primarily due to a $0.5 million increase in depreciation expense for computer equipment. In addition, intangible assets amortization increased $0.4 million, primarily due to a $0.4 million increase in amortization expense of capitalized software.

Previous wording

Interest expense increased by $0.2 million, or 4%, to $5.0 million for the three months ended June 30, 2026, as compared to the same period in 2025. The change in interest expense was primarily due to a $0.9 million decrease in gain from our interest swap hedge activities, partially offset by a $0.7 million decrease in interest expense from our floating rate term loan debt, primarily due to a decline in market interest rates and a reduced base margin rate resulting from the refinancing of the term loan.

Current wording

Interest expense was $5.0 million for the three months ended September 30, 2026 and 2025, remaining relatively flat. The change in interest expense was primarily due to a $0.7 million decrease in gain from our interest swap hedge activities, partially offset by a $0.7 million decrease in interest expense from our floating rate term loan debt, primarily due to a decline in market interest rates and a reduced base margin rate resulting from the refinancing of the term loan.

Previous wording

Net other income decreased by $3.1 million to $0.1 million for the six months ended June 30, 2026 as compared to the same period in 2025. The decrease in net other income was primarily due to a $2.2 million increase in loss from remeasurement related to the fluctuation of the foreign currency rate and a $0.8 million decrease in interest income.

Current wording

Net other income decreased by $0.2 million to a net income of $1.5 million for the three months ended September 30, 2026 as compared to the same period in 2025. The decrease in net other income was primarily due to a $1.2 million increase in losses from remeasurement related to fluctuations in foreign currency exchange rates, partially offset by a $0.9 million increase in other miscellaneous income, primarily reflecting the impact of expenses recorded in the same quarter of 2025 on the year-over-year comparison.

Previous wording

Our income tax benefit was $0.3 million, resulting in an effective income tax rate of 5% for the three months ended June 30, 2026 as compared to income tax expense of $2.9 million, or an effective income tax rate of 66%, for the same period in 2025. Our income tax expense for the three months ended June 30, 2026 and 2025 was primarily due to the tax effects of U.S. pre-tax income, the relative mix of domestic and international earnings, the impact of non-deductible items, adjustments to the valuation allowances, the effects of tax elections made for U.K. earnings, and discrete tax items.

Current wording

Our income tax expense on continued operation was $2.4 million, resulting in an effective income tax rate of (203)% for the three months ended September 30, 2026 as compared to income tax expense of $1.0 million, or an effective income tax rate of (26)%, for the same period in 2025. Our income tax expense for the three months ended September 30, 2026 and 2025 was primarily due to the tax effects of U.S. pre-tax income, the relative mix of domestic and international earnings, the impact of non-deductible items, adjustments to the valuation allowances, the effects of tax elections made for U.K. earnings, and discrete tax items.

Previous wording

Net loss was $6.1 million, representing a $7.6 million decrease in net income for the three months ended June 30, 2026 as compared to net income of $1.5 million for the same period of 2025. The decrease in net income was primarily due to a $7.9 million increase in operating expenses, a $2.9 million increase in total other expense, and a $0.8 million increase in cost of revenue, partially offset by a $3.2 million decrease in tax expense and a $0.9 million increase in revenue.

Current wording

Net loss was $3.6 million, representing a $1.3 million increase in net income for the three months ended September 30, 2026 as compared to net loss of $4.8 million for the same period of 2025. The increase in net income was primarily due to a $4.0 million increase in revenue, and a $2.0 million decrease in cost of revenue, partially offset by a $3.1 million increase in operating expenses, a $1.4 million increase in tax expense, and a $0.2 million increase in total other expense.

Previous wording

The following table summarizes our unaudited statements of operations data for the six months ended at June 30, 2026 and 2025:

Current wording

The following table summarizes our unaudited statements of operations data for the nine months ended at September 30, 2026 and 2025:

Previous wording

Total revenues increased by $2.9 million, or 2%, to $187.4 million for the six months ended June 30, 2026 as compared to the same period in 2025. Overall revenue growth was primarily driven by our software product offerings, supported by strong demand from existing customers and expansion of relationships with existing customers.

Current wording

Total revenues increased by $6.9 million, or 3%, to $282.3 million for the nine months ended September 30, 2026 as compared to the same period in 2025. Overall revenue growth was primarily driven by our software product offerings, supported by strong demand from existing customers and expansion of relationships with existing customers.

Previous wording

Software revenues increased by $5.5 million, or 6%, to $98.5 million for the six months ended June 30, 2026 as compared to the same period in 2025, primarily driven by increased demand from existing customers and expanded relationships with existing customers.

Current wording

Software revenues increased by $10.5 million, or 8%, to $147.4 million for the nine months ended September 30, 2026 as compared to the same period in 2025, primarily driven by increased demand from existing customers and expanded relationships with existing customers.

Previous wording

Services revenues decreased by $2.6 million, or 3%, to $88.8 million for the six months ended June 30, 2026 as compared to the same period in 2025.

Current wording

Services revenues decreased by $3.5 million, or 3%, to $134.9 million for the nine months ended September 30, 2026 as compared to the same period in 2025.

Previous wording

Cost of revenues increased $0.8 million, or 1%, to $69.8 million for the six months ended June 30, 2026 as compared to the same period in 2025. The increase in cost of revenue was primarily due to a $1.4 million increase in professional and consulting expenses, a $0.9 million increase in employee-related costs, and a $0.4 million increase in cost of license, partially offset by a $0.8 million decrease in stock based compensation costs, a $0.6 million decrease in other miscellaneous expense, and a $0.5 million decrease in executive recruiting expense.

Current wording

Cost of revenues decreased $1.2 million, or 1%, to $101.2 million for the nine months ended September 30, 2026 as compared to the same period in 2025. The decrease in cost of revenue was primarily due to a $2.4 million decrease in stock-based compensation costs, a $0.9 million decrease in miscellaneous operating expense, a $0.5 million decrease in executive recruiting expense, and a $0.3 million decrease in intangible assets amortization, partially offset by a $1.3 million increase in employee-related costs, a $1.1 million increase in professional and consulting expense, and a $0.5 million increase in cost of license.

Previous wording

Sales and marketing expenses increased by $1.9 million, or 7%, to $27.9 million for the six months ended June 30, 2026 as compared to the same period in 2025. Sales and marketing expenses increased primarily due to a $0.9 million increase in professional and consulting expense, a $0.6 million increase in employee-related costs, a $0.3 million increase in marketing expense, and a $0.3 increase in travel expense, partially offset by a $0.2 million decrease in stock-based compensation costs.

Current wording

Sales and marketing expenses increased by $0.9 million, or 2%, to $39.6 million for the nine months ended September 30, 2026 as compared to the same period in 2025. Sales and marketing expenses increased primarily due to a $0.9 million increase in professional and consulting expense, a $0.5 million increase in marketing expense, and a $0.3 million increase in travel expense, partially offset by a $0.7 million decrease in stock-based compensation costs.

Previous wording

Research and development expenses increased by $2.5 million, or 13%, to $22.0 million for the six months ended June 30, 2026 as compared to the same period in 2025. The increase in research and development expenses was primarily due to a $2.8 million increase in employee-related costs mainly resulting from head count growth associated with investments in software development, including AI integration across our product portfolio, a $0.5 million increase in miscellaneous expense, a $0.1 million increase in stock-based compensation costs, and a $0.1 million increase in facility-lease related expense, partially offset by a $1.2 million increase in capitalized cost in R&D.

Current wording

Research and development expenses increased by $3.0 million, or 10%, to $32.8 million for the nine months ended September 30, 2026 as compared to the same period in 2025. The increase in research and development expenses was primarily due to a $4.3 million increase in employee-related costs mainly resulting from head count growth associated with investments in software development, including AI integration across our product portfolio, a $0.8 million increase in miscellaneous expense, and a $0.4 million increase in equipment and software expense, partially offset by a $2.1 million increase in capitalized cost in R&D, a $0.2 million decrease in stock-based compensation costs, and a $0.2 million decrease in professional and consulting expense.

Previous wording

General and administrative expenses increased by $14.9 million, or 41%, to $50.9 million for the six months ended June 30, 2026 as compared to the same period in 2025. The increase in general and administrative expenses was primarily due to a $13.1 million increase in business acquisition contingent consideration expense, driven primarily by an additional $7.2 million recorded during the current year, as well as the favorable impact of a decrease in the contingent consideration liability recognized in the same period in 2025, a $1.6 million increase in executive recruiting and retention expenses, a $1.3 million increase in lease abandonment expense, primarily due to the absence of a non-recurring gain recognized in the prior year that reduced expenses in that period, a $1.3 million increase in equipment and software expense, and a $0.7 million increase in professional and consulting expense, partially offset by a $1.0 million decrease in stock-based compensation costs, a $0.9 million in facility-lease related expenses, a $0.7 million decrease in merger and acquisition expense and a $0.5 million decrease in provision of allowance of credit loss.

Current wording

General and administrative expenses increased by $17.6 million, or 29%, to $77.8 million for the nine months ended September 30, 2026 as compared to the same period in 2025. The increase in general and administrative expenses was primarily due to a $10.4 million increase in business acquisition contingent consideration expense, driven primarily by an additional $7.2 million recorded during the current year, as well as the favorable impact of a decrease in the contingent consideration liability recognized in the same period in 2025, a $3.6 million increase in employee-related costs, including a $2.3 million increase in reorganization expense, a $2.9 million increase in equipment and software expense, a $2.7 million increase in executive recruiting and retention expenses, a $1.5 million increase in professional and consulting expense, a $1.3 million increase in lease abandonment expense, primarily due to the absence of a non-recurring gain recognized in the prior year that reduced expenses in that period, and a $0.4 million increase in office related expense, partially offset by a $2.1 million decrease in stock-based compensation costs, a $1.4 million decrease in facility-lease related expenses, a $0.8 million decrease in merger and acquisition expense, and a $0.6 million decrease in provision of allowance of credit loss.

Previous wording

Depreciation and amortization expense increased by $0.7 million, or 6%, to $11.7 million for the three months ended June 30, 2026 as compared to the same period in 2025. The increase in depreciation and amortization expense was primarily due to a $0.8 million increase in depreciation of computer equipment.

Current wording

Depreciation and amortization expense increased by $2.1 million, or 6%, to $35.0 million for the nine months ended September 30, 2026 as compared to the same period in 2025. The increase in depreciation and amortization expense was primarily due to a $1.1 million increase in depreciation of computer equipment. In addition, amortization of intangible assets increased $1.0 million, primarily due to increase in amortization of capitalized software.

Previous wording

Interest expense increased by $0.3 million, or 3%, to $9.9 million for the six months ended June 30, 2026, as compared to the same period in 2025. The change in interest expense was primarily due to a $1.8 million decrease in gain from our interest swap hedge activities, partially offset by a $1.4 million decrease in interest expense from our floating rate term loan debt, primarily due to a decline in market interest rates and a reduced base margin rate resulting from the refinancing of the term loan.

Current wording

Interest expense increased by $0.3 million, or 2%, to $15.0 million for the nine months ended September 30, 2026, as compared to the same period in 2025. The increase in interest expense was primarily due to a $2.6 million decrease in gain from our interest swap hedge activities, partially offset by a $2.1 million decrease in interest expense from our floating rate term loan debt, primarily due to a decline in market interest rates and a reduced base margin rate resulting from the refinancing of the term loan.

Previous wording

Net other income decreased by $2.7 million to a net expense of $1.2 million for the three months ended June 30, 2026 as compared to the same period in 2025. The decrease in net other income was primarily due to a $2.4 million increase in loss from remeasurement related to the fluctuation of the foreign currency rate, and a $0.3 million decrease in interest income.

Current wording

Net other income decreased by $3.3 million to $1.6 million for the nine months ended September 30, 2026 as compared to the same period in 2025. The decrease in net other income was primarily due to a $3.5 million increase in loss from remeasurement related to the fluctuation of the foreign currency exchange rate and a $0.8 million decrease in interest income, partially offset by a $0.9 million decrease in other miscellaneous expense, primarily reflecting the impact of expenses recorded in the same period of 2025 on the year-over-year comparison.

Previous wording

Our income tax expense was $1.6 million, resulting in an effective income tax rate of (10)% for the six months ended June 30, 2026 as compared to income tax expense of $2.6 million, or an effective income tax rate of 46%, for the same period in 2025. Our income tax expense for the six months ended June 30, 2026 and 2025 was primarily due to the tax effects of U.S. pre-tax income (loss), the relative mix of domestic and international earnings, the impact of non-deductible items, adjustments to the valuation allowances, the effects of tax elections made for U.K. earnings, and discrete tax items.

Current wording

Our income tax expense on continued operation was $4.0 million, resulting in an effective income tax rate of (23)% for the nine months ended September 30, 2026 as compared to income tax expense of $3.6 million, or an effective income tax rate of 205%, for the same period in 2025. Our income tax expense for the nine months ended September 30, 2026 and 2025 was primarily due to the tax effects of U.S. pre-tax income (loss), the relative mix of domestic and international earnings, the impact of non-deductible items, adjustments to the valuation allowances, the effects of tax elections made for U.K. earnings, and discrete tax items.

Previous wording

Net loss was $17.9 million, representing a $20.9 million decrease in net income for the six months ended June 30, 2026 as compared to a net income of $3.0 million for the same period of 2025. The decrease in net income was primarily due to a $20.5 million increase in operating expenses, a $3.5 million increase in total other expense, and a $0.8 million increase in expense of cost of revenue, partially offset by a $2.9 million increase in revenue and a $1.0 million decrease in tax expense.

Current wording

Net loss was $21.5 million, representing a $19.6 million decrease in net income for the nine months ended September 30, 2026 as compared to a net loss of $1.8 million for the same period of 2025. The increase in net loss was primarily due to a $23.6 million increase in operating expenses, a $3.7 million increase in total other expense, and a $0.4 million increase in tax expense, partially offset by a $6.9 million increase in revenue and a $1.2 million decrease in cost of revenue.

Previous wording

We have consistently generated positive cash flow from operations, providing $15.6 million and $23.3 million from continuing operations as a source of funds for the six months ended June 30, 2026 and 2025, respectively. Our additional liquidity comes from several sources: maintaining adequate balances of cash and cash equivalents, issuing common stock, and accessing credit facilities and revolving lines of credit. The following table provides a summary of the major sources of liquidity for the six- and 12-month periods ended at June 30, 2026 and December 31, 2025, respectively, and as of June 30, 2026 and December 31, 2025.

Current wording

We have consistently generated positive cash flow from operations, providing $46.3 million and $51.4 million from continuing operations as a source of funds for the nine months ended September 30, 2026 and 2025, respectively. Our additional liquidity comes from several sources: maintaining adequate balances of cash and cash equivalents, issuing common stock, and accessing credit facilities and revolving lines of credit. The following table provides a summary of the major sources of liquidity for the nine- and 12-month periods ended at September 30, 2026 and December 31, 2025, respectively, and as of September 30, 2026 and December 31, 2025.

Previous wording

(a) Net cash from operating activities for the six months ended June 30, 2026 and twelve months ended December 31, 2025.

Current wording

(a) Net cash from operating activities for the nine months ended September 30, 2026 and twelve months ended December 31, 2025.

Previous wording

(b) Cash balances as of June 30, 2026 and December 31, 2025 included $50.7 million and $76.2 million in cash and cash equivalents, respectively, held outside of the United States.

Current wording

(b) Cash balances as of September 30, 2026 and December 31, 2025 included $58.2 million and $76.2 million in cash and cash equivalents, respectively, held outside of the United States.

Previous wording

On April 11, 2025, our Board of Directors approved a stock repurchase program authorizing the Company to repurchase up to $100.0 million of its common stock. For the six months ended June 30, 2026, we repurchased 9,009,459 shares of our common stock for an aggregate purchase price and fees of $57.4 million under the authorized share repurchase program. These repurchases resulted in an increase in treasury stock and reduced weighted-average diluted shares outstanding. As of June 30, 2026, no funds remained available under the Company's existing share repurchase authorization program.

Current wording

On April 11, 2025, our Board of Directors approved a stock repurchase program authorizing the Company to repurchase up to $100.0 million of its common stock. For the nine months ended September 30, 2026, we repurchased 9,009,459 shares of our common stock for an aggregate purchase price and fees of $57.4 million under the authorized share repurchase program. These repurchases resulted in an increase in treasury stock and reduced weighted-average diluted shares outstanding. As of September 30, 2026, no funds remained available under the April 2025 share repurchase program. On August 3, 2026, the Board of Directors approved a new common stock repurchase program authorizing the Company to repurchase up to $50.0 million of its common stock. As of September 30, 2026, the Company did not repurchase any shares under the new program.

Previous wording

Our other material cash requirements from known contractual obligations are principal and interest payments on long term debt. We also have future cash obligations of $12.5 million for lease contracts, which have remaining terms of one to nine years.

Current wording

Our other material cash requirements from known contractual obligations are principal and interest payments on long term debt. We also have future cash obligations of $12.3 million for lease contracts, which have remaining terms of one to eight years.

Previous wording

Our cash flows from operating activities primarily include net income adjusted for (i) non-cash items included in net income, such as provisions (recoveries) for credit losses, depreciation and amortization, stock-based compensation, deferred taxes, and other non-cash items and (ii) changes in the balances of operating assets and liabilities. Net cash provided by operating activities in the first six months of 2026 was $15.6 million, compared to $23.3 million in the same period of 2025. The $7.7 million decrease in cash from operating activities was primarily driven by lower cash-adjusted net income, an increase in cash used for prepaid and other assets and a decrease in cash collected on accounts receivable, partially offset by higher cash inflows from deferred revenues and less cash outflows to settle liabilities.

Current wording

Our cash flows from operating activities primarily include net income adjusted for (i) non-cash items included in net income, such as provisions (recoveries) for credit losses, depreciation and amortization, stock-based compensation, deferred taxes, and other non-cash items and (ii) changes in the balances of operating assets and liabilities. Net cash provided by operating activities in the first nine months of 2026 was $46.3 million, compared to $51.4 million in the same period of 2025. The $5.1 million decrease in cash from operating activities was primarily driven by lower cash-adjusted net income, and an increase in cash used for prepaid and other assets, partially offset by higher cash inflows from deferred revenues, less cash outflows to settle liabilities, and an increase in cash collected on accounts receivable,

Previous wording

Net cash used in investing activities in the first six months of 2026 was $14.5 million, an increase of $1.7 million, compared to $12.7 million in the same period of 2025. The change in investing activities was primarily due to a $1.0 million increase in cash utilized in capitalized software development costs to support our growth and a $0.7 million increase in cash outflow for capital expenditure.

Current wording

Net cash used in investing activities in the first nine months of 2026 was $22.7 million, an increase of $3.2 million, compared to $19.5 million in the same period of 2025. The change in investing activities was primarily due to a $1.9 million increase in cash utilized in capitalized software development costs to support our growth and a $1.3 million increase in cash outflow for capital expenditure.

Previous wording

Net cash used in financing activities in the first six months of 2026 was $82.3 million, compared to $44.7 million in the same period of 2025. The $37.6 million increase in cash used in financing activities was primarily due to a $32.4 million increase in cash used in connection with repurchasing the Company's common stock and a $6.9 million increase in cash payments related to contingent consideration for business acquisitions, partially offset by a $1.6 million decrease in cash payments associated with share awards vested and withheld for payroll tax.

Current wording

Net cash used in financing activities in the first nine months of 2026 was $83.3 million, compared to $59.2 million in the same period of 2025. The $24.1 million increase in cash used in financing activities was primarily due to a $18.7 million increase in cash used in connection with repurchasing the Company's common stock and a $6.9 million increase in cash payments related to contingent consideration for business acquisitions, partially offset by a $1.5 million decrease in cash payments associated with share awards vested and withheld for payroll tax.

Previous wording

Borrowings under the Credit Agreement bear interest at a rate per annum equal to, at the election of the borrowers, either (i) the Term Secured Overnight Financing Rate (“SOFR”) rate, with a floor of 0.00% plus an applicable margin rate of 2.75% for the Term Loans and between 3.50% and 2.75% for loan under the Revolving Facility, depending on the applicable first lien leverage ratio, or (ii) an Alternate Base Rate (“ABR”), with a floor of 1.00%, plus an applicable margin rate of 1.75% for the Term Loan or between 2.50% and 1.75% for loan under the Revolving Facility, depending on the applicable first lien leverage ratio. The ABR is determined as the greatest of (a) the prime rate, (b) the federal funds effective rate, plus 0.50%, and (c) the Term SOFR rate plus 1.00%. Additionally, the Company is obligated to pay a commitment fee of the unused amount and other customary fees.

Current wording

Revolving Facility, depending on the applicable first lien leverage ratio, or (ii) an Alternate Base Rate (“ABR”), with a floor of 1.00%, plus an applicable margin rate of 1.75% for the Term Loan or between 2.50% and 1.75% for loan under the Revolving Facility, depending on the applicable first lien leverage ratio. The ABR is determined as the greatest of (a) the prime rate, (b) the federal funds effective rate, plus 0.50%, and (c) the Term SOFR rate plus 1.00%. Additionally, the Company is obligated to pay a commitment fee of the unused amount and other customary fees.

Previous wording

As of June 30, 2026, we had $294.0 million of outstanding borrowings on the Term Loan, and $100.0 million of availability under the revolving credit facility under the Credit Agreement.

Current wording

As of September 30, 2026, we had $293.3 million of outstanding borrowings on the Term Loan, and $100.0 million of availability under the revolving credit facility under the Credit Agreement.

Previous wording

There have been no material changes to our contractual obligations during the six months ended June 30, 2026 from those disclosed in our 2025 Annual Report, except for payments made in the ordinary course of business.

Current wording

There have been no material changes to our contractual obligations during the nine months ended September 30, 2026 from those disclosed in our 2025 Annual Report, except for payments made in the ordinary course of business.

Previous wording

We recorded income tax expense of $1.6 million for continuing operations, a $16.2 million tax benefit for discontinued operations, and a tax benefit of $14.6 million for the Company for the six months ended June 30, 2026. We recorded income tax expense of $2.6 million for continuing operations, a tax expense $5.4 million for discontinued operations, and a tax expense $8.0 million for the Company for the six months ended June 30, 2025.

Current wording

We recorded income tax expense of $4.0 million for continuing operations, a $16.6 million tax benefit for discontinued operations, and a tax benefit of $12.6 million for the Company for the nine months ended September 30, 2026. We recorded income tax expense of $3.6 million for continuing operations, a tax expense $2.6 million for discontinued operations, and a tax expense $6.2 million for the Company for the nine months ended September 30, 2025.