N-able, Inc.

Previous wording

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our Consolidated Financial Statements and related notes thereto included elsewhere in this report. In addition to historical consolidated financial information, the following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially and adversely from those anticipated in the forward-looking statements. Please see the section entitled “Safe Harbor Cautionary Statement” and “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2025, for a discussion of the uncertainties, risks and assumptions associated with these statements. The following discussion and analysis also includes a discussion of certain non-GAAP financial measures. For a description and reconciliation of the non-GAAP measures discussed in this section, see “Non-GAAP Financial Measures” below.

Current wording

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our Consolidated Financial Statements and related notes thereto included elsewhere in this report. In addition to historical consolidated financial information, the following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially and adversely from those anticipated in the forward-looking statements. Please see the section entitled “Safe Harbor Cautionary Statement” in this report and “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2025, as amended by Amendment No. 1 on Form 10-K/A (together, the “2025 Annual Report”), and Part II, Item 1A of our Quarterly Report on Form 10-Q for the quarter ended June 30, 2026, and this Quarterly Report on Form 10-Q for a discussion of the uncertainties, risks and assumptions associated with these statements. The following discussion and analysis also includes a discussion of certain non-GAAP financial measures. For a description and reconciliation of the non-GAAP measures discussed in this section, see “Non-GAAP Financial Measures” below.

Previous wording

N-able, Inc., a Delaware corporation, together with its subsidiaries (“Company”, “we,” “us” and “our”), protects businesses from evolving cyberthreats. Our AI-powered cybersecurity platform delivers business resilience to approximately 500,000 organizations worldwide, leveraging advanced end-to-end capabilities, simplified workflows, market-leading integrations, and flexible deployment options to improve efficiency and drive critical security outcomes. Our partner-first approach pairs our technology with experts, training, and peer-led events that empower customers to be secure, resilient, and successful.

Current wording

N-able, Inc., a Delaware corporation, together with its subsidiaries (“Company”, “we,” “us” and “our”), protects businesses from evolving cyberthreats. Our AI-powered cybersecurity platform delivers business resilience to over 500,000 organizations worldwide, leveraging advanced end-to-end capabilities, simplified workflows, market-leading integrations, and flexible deployment options to improve efficiency and drive critical security outcomes. Our partner-first approach pairs our technology with experts, training, and peer-led events that empower customers to be secure, resilient, and successful.

Previous wording

Our total revenue was $138.2 million and $130.5 million for the three months ended June 30, 2026 and 2025, respectively. See Note 2. Summary of Significant Accounting Policies in the Notes to Cons olidated Financial Statementsfor further details regarding revenue recognized from subscription and other services.

Current wording

Our total revenue was $137.5 million and $131.1 million for the three months ended September 30, 2026 and 2025, respectively. See Note 2. Summary of Significant Accounting Policies in the Notes to Cons olidated Financial Statementsfor further details regarding revenue recognized from subscription and other services.

Previous wording

Total annual recurring revenue (“ARR”) as of June 30, 2026 was $544.5 million, compared to $513.7 million as of June 30, 2025, representing an increase of 6.0%. This increase was primarily due to steady demand for our solutions.

Current wording

Total annual recurring revenue (“ARR”) as of September 30, 2026 was $553.1 million, compared to $528.1 million as of September 30, 2025, representing an increase of 4.7%. This increase was primarily due to steady demand for our solutions.

Previous wording

As of June 30, 2026, we had 2,706 customers with ARR over $50,000 on our platform, up from 2,540 as of June 30, 2025, representing an increase of 6.5%. Over the same period, customers with over $50,000 of ARR on our platform grew from approximately 60% of our total ARR as of June 30, 2025 to approximately 63% of our total ARR as of June 30, 2026.

Current wording

As of September 30, 2026, we had 2,716 customers with ARR over $50,000 on our platform, up from 2,611 as of September 30, 2025, representing an increase of 4.0%. Over the same period, customers with over $50,000 of ARR on our platform grew from approximately 61% of our total ARR as of September 30, 2025 to approximately 63% of our total ARR as of September 30, 2026.

Previous wording

Our operating income for the three months ended June 30, 2026 was $16.5 million, compared to operating income of $9.3 million for the three months ended June 30, 2025. Our net income for the three months ended June 30, 2026 was $1.8 million, compared to net loss of $4.6 million for the three months ended June 30, 2025. The return to profitability during the three months ended June 30, 2026 was primarily due to an increase in revenue and decreases in general and administrative expense and other (expense) income, net, offset in part by increases in cost of revenue, income tax expense, research and development expense, sales and marketing expense, and interest expense, net. Our Adjusted EBITDA, calculated as net income of $1.8 million and net loss of $4.6 million for the three months ended June 30, 2026 and 2025, respectively, excluding amortization of acquired intangibles and developed technology of $6.8 million and $6.3 million, respectively, depreciation expense of $3.8 million and $4.7 million, respectively, income tax expense of $6.0 million and $5.0 million, respectively, interest expense, net of $8.3 million and $8.1 million, respectively, unrealized foreign currency losses of $1.3 million and $2.4 million, respectively, transaction related costs of $1.1 million and $5.6 million, respectively, stock-based compensation expense and related employer-paid payroll taxes of $10.3 million and $13.2 million, respectively, and restructuring costs and other of $0.6 million and $0.4 million, respectively, was $39.9 million and $40.9 million for the three months ended June 30, 2026 and 2025, respectively. For a description and reconciliation of the non-GAAP measures discussed in this section, see Non-GAAP Financial Measures below.

Current wording

Our operating income for the three months ended September 30, 2026 was $15.4 million, compared to operating income of $10.9 million for the three months ended September 30, 2025. Our net loss for the three months ended September 30, 2026 was $4.4 million, compared to net income of $0.9 million for the three months ended September 30, 2025. The change to a net loss during the three months ended September 30, 2026 was primarily due to increases in income tax expense, cost of revenue, and research and development expense and a decrease in other income (expense), net, offset in part by an increase in revenue and decreases in general and administrative expense, sales and marketing expense, and interest expense, net. Our Adjusted EBITDA, calculated as net loss of $4.4 million and net income of $0.9 million for the three months ended September 30, 2026 and 2025, respectively, excluding amortization of acquired intangibles and developed technology of $6.9 million and $6.4 million, respectively, depreciation expense of $4.0 million and $4.8 million, respectively, income tax expense of $11.9 million and $6.3 million, respectively, interest expense, net of $8.1 million and $8.6 million, respectively, unrealized foreign currency losses of $0.6 million and unrealized foreign currency gains of $4.2 million, respectively, transaction related costs of $0.9 million and $5.5 million, respectively, stock-based compensation expense and related employer-paid payroll taxes of $8.9 million and $12.2 million, respectively, IP transfer costs of $0.8 million and $0.0 million, respectively, retention bonuses of $1.1 million and $0.0 million, respectively, and restructuring costs and other of $4.8 million and $0.4 million, respectively, was $43.6 million and $40.9 million for the three months ended September 30, 2026 and 2025, respectively. For a description and reconciliation of the non-GAAP measures discussed in this section, see Non-GAAP Financial Measures below.

Previous wording

We have built our business to generate strong cash flow over the long term. For the three months ended June 30, 2026 and 2025, cash flows from operations were $26.5 million and $24.2 million, respectively. Our cash flows from operations were reduced by cash payments for interest of $6.5 million and $6.3 million for the three months ended June 30, 2026 and 2025, respectively, and cash payments for income taxes of $8.0 million and $3.7 million for the three months ended June 30, 2026 and 2025, respectively.

Current wording

We have built our business to generate strong cash flow over the long term. For the three months ended September 30, 2026 and 2025, cash flows from operations were $28.8 million and $24.0 million, respectively. Our cash flows from operations were reduced by cash payments for interest of $6.7 million and $6.3 million for the three months ended September 30, 2026 and 2025, respectively, and cash payments for income taxes of $3.3 million and $5.7 million for the three months ended September 30, 2026 and 2025, respectively.

Previous wording

In June 2026, we entered into an amendment to the Credit Agreement to add a delayed draw term loan facility (the “Delayed Draw Term Loan Facility”) with a committed borrowing availability of $75.0 million (the “Delayed Draw Term Loan”). The Credit Agreement, as amended, permits us to draw up to five times in the six months after the effective date of the amendment. Once funded, the Delayed Draw Term Loan’s maturity date and interest rate are equal to the existing Term Loan. As of June 30, 2026, there were no borrowings under the Delayed Draw Term Loan Facility. See Note 8. Debtin the Notes to Consolidated Financial Statements for further details regarding the Delayed Draw Term Loan Facility.

Current wording

In June 2026, we entered into an amendment to the Credit Agreement to add a delayed draw term loan facility (the “Delayed Draw Term Loan Facility”) with a committed borrowing availability of $75.0 million (the “Delayed Draw Term Loan”). The Credit Agreement, as amended, permits us to draw up to five times in the six months after the effective date of the amendment. Once funded, the Delayed Draw Term Loan’s maturity date and interest rate are equal to the existing Term Loan. As of September 30, 2026, there were no borrowings under the Delayed Draw Term Loan Facility. In October 2026, we borrowed the full $75.0 million available under the Delayed Draw Term Loan Facility. See Note 8. Debtand Note 14. Subsequent Eventsin the Notes to Consolidated Financial Statements for further details regarding the Delayed Draw Term Loan Facility.

Previous wording

Operating expenses consist of sales and marketing, research and development and general and administrative expenses as well as amortization of acquired intangibles. Generally, personnel costs are the most significant component of operating expenses and include salaries, bonuses and stock-based compensation and related employer-paid payroll taxes, as well as an allocation of our facilities, depreciation, IT and benefits costs. We had total employees of 1,978, 1,852, and 1,800 as of June 30, 2026, December 31, 2025, and June 30, 2025, respectively. Our stock-based compensation expense decreased during the three months ended June 30, 2026 as compared to the corresponding period of the prior fiscal year primarily due to a decrease in the fair value of equity awards granted to employees as a result of a decline in our stock price during the three months ended June 30, 2026. We expect stock-based compensation expense to continue to decrease during the remainder of the year ending December 31, 2026.

Current wording

Operating expenses consist of sales and marketing, research and development and general and administrative expenses as well as amortization of acquired intangibles. Generally, personnel costs are the most significant component of operating expenses and include salaries, bonuses and stock-based compensation and related employer-paid payroll taxes, as well as an allocation of our facilities, depreciation, IT and benefits costs. We had total employees of 1,918, 1,852, and 1,878 as of September 30, 2026, December 31, 2025, and September 30, 2025, respectively. Our stock-based compensation expense decreased during the three months ended September 30, 2026 as compared to the corresponding period of the prior fiscal year primarily due to forfeitures of unvested equity awards held by employees impacted by our July 2026 workforce reorganization and lower grant-date fair values of equity awards granted to employees during 2026, which reflect the decline in our stock price during the first half of 2026. We expect stock-based compensation expense to continue to decrease during the remainder of the year ending December 31, 2026.

Previous wording

•Amortization of Acquired Intangibles. We amortize to operating expenses capitalized costs of intangible assets primarily acquired in connection with the take private transaction of SolarWinds in early 2016 and subsequent business combinations, including the July 1, 2022 acquisition of Spinpanel and the November 20, 2024 acquisition of Adlumin.

Current wording

•Amortization of Acquired Intangibles. We amortize to operating expenses capitalized costs of intangible assets primarily acquired in connection with the take private transaction of SolarWinds in early 2016 and subsequent business combinations, including the July 1, 2022 acquisition of Spinpanel and the November 20, 2024 acquisition of Adlumin. We also amortize to operating expenses the customer relationships intangible asset recognized in connection with the July 29, 2026 asset acquisition from Infrascale.

Previous wording

Total revenue increased $7.7 million, or 5.9%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025. We base revenue by geography on the billing address of each customer. Based on customer location, revenue from the United States was approximately 48.4% and 49.2% of total revenue for the three months ended June 30, 2026 and 2025, respectively. Revenue from the United Kingdom was approximately 10.4% and 10.4% of total revenue for the three months ended June 30, 2026 and 2025, respectively. Other than the United States and the United Kingdom, no single country accounted for 10% or more of our total revenue during these periods.

Current wording

Total revenue increased $6.4 million, or 4.9%, for the three months ended September 30, 2026 compared to the three months ended September 30, 2025. We base revenue by geography on the billing address of each customer. Based on customer location, revenue from the United States was approximately 48.4% and 49.3% of total revenue for the three months ended September 30, 2026 and 2025, respectively. Revenue from the United Kingdom was approximately 10.5% and 10.2% of total revenue for the three months ended September 30, 2026 and 2025, respectively. Other than the United States and the United Kingdom, no single country accounted for 10% or more of our total revenue during these periods.

Previous wording

Subscription Revenue. Subscription revenue increased $7.9 million, or 6.1%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025. The increase in subscription revenue was primarily driven by increased traction across our cybersecurity platform. Subscription revenue as a percentage of our total revenue was 99.2% for the three months ended June 30, 2026, compared to 98.9% for the three months ended June 30, 2025.

Current wording

Subscription Revenue. Subscription revenue increased $6.5 million, or 5.0%, for the three months ended September 30, 2026 compared to the three months ended September 30, 2025. The increase in subscription revenue was primarily driven by increased traction across our cybersecurity platform. Subscription revenue as a percentage of our total revenue was 99.2% for the three months ended September 30, 2026, compared to 99.1% for the three months ended September 30, 2025.

Previous wording

Our annual dollar-based net revenue retention rate for our subscription products was approximately 106% and 102% for the trailing twelve-month periods ended June 30, 2026 and 2025, respectively. The 106% dollar-based net revenue retention rate reflects the impact from our pricing and packaging changes. Our calculation includes any expansion revenue and is net of any contraction or cancellation, but excludes credits and revenue attributable to any customer who was not a customer with a paid subscription in the prior period. To calculate our annual dollar-based net revenue retention rate, we first identify the customers with active paid subscriptions in the last month of the prior-year period, or the base customers. We then divide the subscription revenue in the last month of the current-year period attributable to the base customers by the revenue attributable to those base customers in the last month of the prior-year period. Our dollar-based net revenue retention rate for a particular period is then obtained by averaging the rates from that particular period with the results from each of the prior eleven months.

Current wording

Our annual dollar-based net revenue retention rate for our subscription products was approximately 105% and 102% for the trailing twelve-month periods ended September 30, 2026 and 2025, respectively. Our calculation includes any expansion revenue and is net of any contraction or cancellation, but excludes credits and revenue attributable to any customer who was not a customer with a paid subscription in the prior period. To calculate our annual dollar-based net revenue retention rate, we first identify the customers with active paid subscriptions in the last month of the prior-year period, or the base customers. We then divide the subscription revenue in the last month of the current-year period attributable to the base customers by the revenue attributable to those base customers in the last month of the prior-year period. Our dollar-based net revenue retention rate for a particular period is then obtained by averaging the rates from that particular period with the results from each of the prior eleven months.

Previous wording

Other Revenue. Other revenue decreased $0.2 million, or 16.2%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025, primarily due to decreases in maintenance revenue and professional services revenue. Other revenue as a percentage of our total revenue was 0.8% for the three months ended June 30, 2026, compared to 1.1% for the three months ended June 30, 2025.

Current wording

Other Revenue. Other revenue decreased $0.1 million, or 7.1%, for the three months ended September 30, 2026 compared to the three months ended September 30, 2025, primarily due to a decrease in maintenance revenue of $0.2 million, partially offset by an increase in professional services revenue of $0.1 million. Other revenue as a percentage of our total revenue was 0.8% for the three months ended September 30, 2026, compared to 0.9% for the three months ended September 30, 2025.

Previous wording

Total cost of revenue increased $3.3 million, or 11.3%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025, primarily due to an increase in public cloud infrastructure and hosting fees and royalties related to our subscription products of $4.0 million, partially offset by a decrease in depreciation of servers and amortization of capitalized internal-use software costs of $0.5 million.

Current wording

Total cost of revenue increased $4.8 million, or 16.2%, for the three months ended September 30, 2026 compared to the three months ended September 30, 2025, primarily due to an increase in public cloud infrastructure and hosting fees and royalties related to our subscription products of $4.7 million, partially offset by a decrease in depreciation of servers and amortization of capitalized internal-use software costs of $0.5 million.

Previous wording

General and Administrative. General and administrative expenses decreased $3.3 million, or 14.3%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025, primarily due to decreases in expense related to the Adlumin deferred consideration liability of $1.6 million, personnel costs due to headcount and salary decreases of $1.1 million, and expense related to the Adlumin contingent consideration liability of $0.6 million.

Current wording

General and Administrative. General and administrative expenses decreased $3.5 million, or 14.5%, for the three months ended September 30, 2026 compared to the three months ended September 30, 2025, primarily due to decreases in expense related to the Adlumin contingent consideration liability of $1.9 million, bad debt expense of $1.9 million, and expense related to the Adlumin deferred consideration liability of $1.6 million, partially offset by increases in restructuring expenses of $0.8 million and professional fees of $0.6 million.

Previous wording

Interest expense, net increased by $0.3 million, or 3.1%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025, primarily due to an increase in expense related to the Credit Agreement amendment of $0.8 million, partially offset by a decrease in expense of $0.6 million related to the Adlumin deferred consideration liability. Outstanding borrowings under the Credit Agreement bear interest at variable rates, and therefore changes in interest rates will have an impact on our financial results and cash flows. See Note 8. Debt in the Notes to Consolidated Financial Statementsfor further details regarding the Credit Agreement and Note 3. Acquisitions, Note 6. Fair Value Measurements, and Note 11. Commitments and Contingencies for further details regarding the acquisition of Adlumin.

Current wording

Interest expense, net decreased by $0.6 million, or 6.7%, for the three months ended September 30, 2026 compared to the three months ended September 30, 2025, primarily due to a decrease in expense of $0.6 million related to the Adlumin deferred consideration liability. Outstanding borrowings under the Credit Agreement bear interest at variable rates, and therefore changes in interest rates will have an impact on our financial results and cash flows. See Note 8. Debt in the Notes to Consolidated Financial Statementsfor further details regarding the Credit Agreement and Note 3. Acquisitions, Note 6. Fair Value Measurements, and Note 11. Commitments and Contingencies for further details regarding the acquisition of Adlumin.

Previous wording

Other (expense) income, net decreased by $0.4 million, or 49.3%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025, primarily due to decreased losses due to the impact of exchange rates on foreign currency denominated accounts of $0.5 million

Current wording

Other (expense) income, net decreased by $4.8 million, or 96.3%, for the three months ended September 30, 2026 compared to the three months ended September 30, 2025, primarily due to decreased gains due to the impact of exchange rates on foreign currency denominated accounts of $4.7 million.

Previous wording

Our income tax expense for the three months ended June 30, 2026 increased by $0.9 million as compared to the three months ended June 30, 2025. The effective tax rate decreased to 77.2% for the same period primarily due to decreases in income taxes on income outside of the United States and in the amount of unbenefited loss in the United States.

Current wording

Our income tax expense for the three months ended September 30, 2026 increased by $5.6 million as compared to the three months ended September 30, 2025. The effective tax rate increased to 158.1% for the same period primarily due to increases in income taxes on income outside of the United States, including the additional discrete income tax expense of $6.7 million related to the intercompany transfer of certain intellectual property rights, and the amount of unbenefited loss in the United States.

Previous wording

Total revenue increased $22.0 million, or 8.8%, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025. We base revenue by geography on the billing address of each customer. Based on customer location, revenue from the United States was approximately 48.4% and 50.1% of total revenue for the six months ended June 30, 2026 and 2025, respectively. Revenue from the United Kingdom was approximately 10.4% and 10.2% of total revenue for the six months ended June 30, 2026 and 2025, respectively. Other than the United States and the United Kingdom, no single country accounted for 10% or more of our total revenue during these periods.

Current wording

Total revenue increased $28.4 million, or 7.5%, for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025. We base revenue by geography on the billing address of each customer. Based on customer location, revenue from the United States was approximately 48.4% and 49.8% of total revenue for the nine months ended September 30, 2026 and 2025, respectively. Revenue from the United Kingdom was approximately 10.4% and 10.2% of total revenue for the nine months ended September 30, 2026 and 2025, respectively. Other than the United States and the United Kingdom, no single country accounted for 10% or more of our total revenue during these periods.

Previous wording

Subscription Revenue. Subscription revenue increased $22.3 million, or 9.1%, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025. The increase in subscription revenue was primarily driven by increased traction across our cybersecurity platform. Subscription revenue as a percentage of our total revenue was 99.1% for the six months ended June 30, 2026, compared to 98.9% for the six months ended June 30, 2025.

Current wording

Subscription Revenue. Subscription revenue increased $28.8 million, or 7.7%, for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025. The increase in subscription revenue was primarily driven by increased traction across our cybersecurity platform. Subscription revenue as a percentage of our total revenue was 99.1% for the nine months ended September 30, 2026, compared to 99.0% for the nine months ended September 30, 2025.

Previous wording

Our annual dollar-based net revenue retention rate for our subscription products was approximately 106% and 102% for the trailing twelve-month periods ended June 30, 2026 and 2025, respectively. The 106% dollar-based net revenue retention rate reflects the impact from our pricing and packaging changes.

Current wording

Our annual dollar-based net revenue retention rate for our subscription products was approximately 105% and 102% for the trailing twelve-month periods ended September 30, 2026 and 2025, respectively.

Previous wording

Other Revenue. Other revenue decreased $0.4 million, or 13.0%, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025, primarily due to decreases in maintenance revenue and professional services revenue. Other revenue as a percentage of our total revenue was 0.9% for the six months ended June 30, 2026, compared to 1.1% for the six months ended June 30, 2025.

Current wording

Other Revenue. Other revenue decreased $0.4 million, or 11.2%, for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025, primarily due to a decrease in maintenance revenue. Other revenue as a percentage of our total revenue was 0.9% for the nine months ended September 30, 2026, compared to 1.0% for the nine months ended September 30, 2025.

Previous wording

Total cost of revenue increased $7.4 million, or 13.0%, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025, primarily due to increases in public cloud infrastructure and hosting fees and royalties related to our subscription products of $7.5 million and depreciation and amortization of capitalized internal-use software costs of $0.5 million, partially offset by a decrease in personnel costs driven by headcount and salary decreases of $0.5 million.

Current wording

Total cost of revenue increased $12.2 million, or 14.1%, for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025, primarily due to increases in public cloud infrastructure and hosting fees and royalties related to our subscription products of $12.2 million and third-party services of $0.7 million.

Previous wording

Sales and Marketing. Sales and marketing expenses increased $0.3 million, or 0.8%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025, primarily due to increases in advertising, public relations, and other marketing spend of $2.7 million, partially offset by decreases in acquisition-related costs of $1.4 million and personnel costs driven by headcount and salary decreases of $0.8 million.

Current wording

Sales and Marketing. Sales and marketing expenses increased $1.1 million, or 0.9%, for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025, primarily due to increases in advertising, public relations, and other marketing spend of $3.1 million, restructuring costs of $2.5 million, and subscription costs of $0.7 million, partially offset by decreases in acquisition-related costs of $3.3 million and personnel costs driven by headcount decreases of $1.2 million.

Previous wording

Research and Development. Research and development expenses increased $0.3 million, or 1.1%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025, primarily driven by increases in allocated facilities and IT costs of $0.4 million and personnel costs driven by headcount and salary increases of $0.3 million, partially offset by decreases in contract services costs and travel expenses of $0.5 million.

Current wording

Research and Development. Research and development expenses increased $4.4 million, or 5.8%, for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025, primarily driven by increases in restructuring expenses of $1.9 million, subscription costs of $1.4 million driven by AI software subscriptions and allocated facilities and IT costs of $1.3 million, and a decrease in capitalized third-party costs of $0.7 million, partially offset by decreases in contract services costs of $0.6 million and travel expenses of $0.5 million.

Previous wording

General and Administrative. General and administrative expenses decreased $7.0 million, or 14.8%, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025, primarily due to decreases in expense related to the Adlumin deferred consideration liability of $3.0 million, acquisition-related costs of $2.5 million, expense related to the Adlumin contingent consideration liability of $1.9 million, allocated facilities and IT costs of $0.8 million, and personnel costs due to headcount and salary decreases of $0.7 million, partially offset by increases in bad debt expense of $1.1 million, restructuring costs of $0.7 million, and professional fees and contract services costs of $0.7 million.

Current wording

General and Administrative. General and administrative expenses decreased $10.5 million, or 14.7%, for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025, primarily due to decreases in expense related to the Adlumin deferred consideration liability of $4.6 million, expense related to the Adlumin contingent consideration liability of $3.8 million, acquisition-related costs of $2.4 million, allocated facilities and IT costs of $1.0 million, bad debt expense of $0.8 million, and personnel costs due to headcount decreases of $0.7 million, partially offset by increases in restructuring expenses of $1.5 million, professional fees of $0.9 million, and contract services costs of $0.7 million.

Previous wording

Interest expense, net increased by $0.8 million, or 5.1%, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025, primarily due to a decrease in interest income on recoverable taxes of $1.1 million and an increase in expense related to the Credit Agreement amendment of $0.8 million, partially offset by a decrease in expense of $1.2 million related to the Adlumin deferred consideration liability. Outstanding borrowings under the Credit Agreement bear interest at variable rates, and therefore changes in interest rates will have an impact on our financial results and cash flows. See Note 8. Debt in the Notes to Consolidated Financial Statementsfor further details regarding the Credit Agreement and Note 3. Acquisitions, Note 6. Fair Value Measurements, and Note 11. Commitments and Contingencies for further details regarding the acquisition of Adlumin.

Current wording

Interest expense, net increased by $0.2 million, or 0.8%, for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025, primarily due to a decrease in interest income on recoverable taxes of $1.1 million and increases in expense related to the Credit Agreement amendment of $1.0 million, partially offset by a decrease in expense of $1.9 million related to the Adlumin deferred consideration liability. Outstanding borrowings under the Credit Agreement bear interest at variable rates, and therefore changes in interest rates will have an impact on our financial results and cash flows. See Note 8. Debt in the Notes to Consolidated Financial Statementsfor further details regarding the Credit Agreement and Note 3. Acquisitions, Note 6. Fair Value Measurements, and Note 11. Commitments and Contingencies for further details regarding the acquisition of Adlumin.

Previous wording

Other (expense) income, net changed by $1.8 million, or 258.2%, from income of $0.7 million for the six months ended June 30, 2025 to expense of $1.1 million for the six months ended June 30, 2026, primarily due to increased losses from the impact of exchange rates on foreign currency denominated accounts of $1.7 million.

Current wording

Other (expense) income, net changed by $6.6 million, or 116.2%, from income of $5.6 million for the nine months ended September 30, 2025 to expense of $0.9 million for the nine months ended September 30, 2026, primarily due to increased losses from the impact of exchange rates on foreign currency denominated accounts of $6.4 million.

Previous wording

Our income tax expense for the six months ended June 30, 2026 increased by $2.1 million as compared to the six months ended June 30, 2025. The effective tax rate increased to 99.3% for the same period primarily due to a decrease in the amount of unbenefited loss in the United States and an increase in income taxes on income outside of the United States.

Current wording

Our income tax expense for the nine months ended September 30, 2026 increased by $7.7 million as compared to the nine months ended September 30, 2025. The effective tax rate decreased to 123.8% for the same period primarily due to the overall increase in year-to-date income, partially offset by an increase in income taxes on income outside of the United States, including the additional discrete income tax expense of $6.7 million related to the intercompany transfer of certain intellectual property rights, and a decrease in the amount of unbenefited loss in the United States attributable to the intercompany transfer of certain intellectual property rights.

Previous wording

In addition to financial measures prepared in accordance with GAAP, we use certain non-GAAP financial measures to clarify and enhance our understanding, and aid in the period-to-period comparison, of our performance. We believe that these non-GAAP financial measures provide supplemental information that is meaningful when assessing our operating performance because they exclude the impact of certain amounts that our management and Board of Directors do not consider part of core operating results when assessing our operational performance, allocating resources, preparing annual budgets and determining compensation. Accordingly, these non-GAAP financial measures may provide insight to investors into the motivation and decision-making of management in operating the business. Investors are encouraged to review the reconciliation of each of these non-GAAP financial measures to its most comparable GAAP financial measure included below.

Current wording

In addition to financial measures prepared in accordance with GAAP, we use certain non-GAAP financial measures to clarify and enhance our understanding, and aid in the period-to-period comparison, of our performance. We believe that these non-GAAP financial measures provide supplemental information that is meaningful when assessing our operating performance because they exclude the impact of certain amounts that our management and Board of Directors do not consider part of core operating results when assessing our operational performance, allocating resources, preparing annual budgets and determining compensation. Accordingly, these non-GAAP financial measures may provide insight to investors into the motivation and decision-making of management in operating the business. Investors are encouraged to review the reconciliation of each of these non-GAAP financial measures to its most comparable GAAP financial measure included below. Non-GAAP financial measures presented below for prior periods are derived from, and reflect, the revised GAAP amounts described in Note 2. Summary of Significant Accounting Policies in the Notes to Consolidated Financial Statements.

Previous wording

We provide non-GAAP operating income and related non-GAAP operating margins excluding such items as stock-based compensation expense and related employer-paid payroll taxes, amortization of acquired intangibles, transaction related costs, spin-off costs and restructuring costs and other. We define non-GAAP operating margin as non-GAAP operating income divided by total revenue. Management believes these measures are useful for the following reasons:

Current wording

We provide non-GAAP operating income and related non-GAAP operating margins excluding such items as stock-based compensation expense and related employer-paid payroll taxes, amortization of acquired intangibles, transaction related costs, spin-off costs, IP transfer costs, retention bonuses, and restructuring costs and other. We define non-GAAP operating margin as non-GAAP operating income divided by total revenue. Management believes these measures are useful for the following reasons:

Previous wording

•Restructuring Costs and Other. We provide non-GAAP information that excludes restructuring costs such as severance, certain employee relocation costs, the estimated costs of exiting and terminating facility lease commitments, and the costs of intra-group transfers of IP rights, as they relate to our corporate restructuring and exit activities. These costs are inconsistent in amount and are significantly impacted by the timing and nature of these events. Therefore, although we may incur these types of expenses in the future, we believe that eliminating these costs for purposes of calculating the non-GAAP financial measures facilitates a more meaningful evaluation of our operating performance and comparisons to our past operating performance.

Current wording

•Restructuring Costs and Other. We provide non-GAAP information that excludes restructuring costs and other which consist of severance and related employee benefit costs and the estimated costs of exiting and terminating facility lease commitments incurred in connection with restructuring plans approved by management, including our July 2026 workforce reorganization, as well as certain other costs related to our corporate restructuring activities that are not directly attributable to a restructuring plan. These restructuring costs are directly attributable to specific restructuring actions and would not have been incurred absent those actions. These costs are inconsistent in amount and are significantly impacted by the timing and nature of these events. Therefore, although we may incur these types of expenses in the future, we believe that eliminating these costs for purposes of calculating the non-GAAP financial measures facilitates a more meaningful evaluation of our operating performance and comparisons to our past operating performance.

Previous wording

We regularly monitor adjusted EBITDA and adjusted EBITDA margin, as they are measures we use to assess our operating performance. We define adjusted EBITDA as net income or loss, excluding amortization of acquired intangibles and developed technology, depreciation expense, income tax expense, interest expense, net, unrealized foreign currency losses (gains), transaction related costs, spin-off costs, stock-based compensation expense and related employer-paid payroll taxes and restructuring and other costs. We define adjusted EBITDA margin as adjusted EBITDA divided by total revenue. Adjusted EBITDA has limitations as an analytical tool, and you should not consider it in isolation or as a substitute for analysis of our results as reported under GAAP. Some of these limitations include:

Current wording

We regularly monitor adjusted EBITDA and adjusted EBITDA margin, as they are measures we use to assess our operating performance. We define adjusted EBITDA as net income or loss, excluding amortization of acquired intangibles and developed technology, depreciation expense, income tax expense, interest expense, net, unrealized foreign currency losses (gains), transaction related costs, spin-off costs, stock-based compensation expense and related employer-paid payroll taxes, IP transfer costs, retention bonuses, and restructuring costs and other. We define adjusted EBITDA margin as adjusted EBITDA divided by total revenue. Transaction related costs, spin-off costs, stock-based compensation and related employer-paid payroll taxes, IP transfer costs, retention bonuses, and restructuring costs and other are described under Non-GAAP Operating Income and

Previous wording

Cash and cash equivalents were $115.8 million as of June 30, 2026. As our sales and operating cash flows are primarily generated in the United Kingdom and Canada, our international subsidiaries held approximately $106.2 million of cash and cash equivalents, of which 72.8%, 15.9%, 3.4%, and 2.1% were held in United States Dollars, Euros, British Pound Sterling, and Canadian Dollars, respectively. We intend either to invest our foreign earnings permanently into foreign operations or to remit these earnings to our United States entities in a tax-efficient manner. The U.S. Tax Cuts and Jobs Act of 2017 imposed a mandatory transition tax on accumulated foreign earnings and eliminates United States federal income taxes on foreign subsidiary distributions. As a result, our earnings in foreign jurisdictions are generally available for distribution to the United States without significant U.S. tax consequences.

Current wording

Cash and cash equivalents were $92.5 million as of September 30, 2026. As our sales and operating cash flows are primarily generated in Canada and the United Kingdom, our international subsidiaries held approximately $86.7 million of cash and cash equivalents, of which 59.2%, 28.3%, 5.2%, and 2.0% were held in United States Dollars, Euros, Canadian Dollars, and British Pound Sterling, respectively. We intend either to invest our foreign earnings permanently into foreign operations or to remit these earnings to our United States entities in a tax-efficient manner. The U.S. Tax Cuts and Jobs Act of 2017 imposed a mandatory transition tax on accumulated foreign earnings and eliminates United States federal income taxes on foreign subsidiary distributions. As a result, our earnings in foreign jurisdictions are generally available for distribution to the United States without significant U.S. tax consequences.

Previous wording

In connection with the Separation and Distribution, on July 19, 2021, certain subsidiaries of the Company entered into a credit agreement (the “Credit Agreement”) with JPMorgan Chase, Bank N.A. as administrative agent and collateral agent and the lenders from time to time party thereto. The Credit Agreement provided for $410.0 million of first lien secured credit facilities (the “Credit Facilities”), consisting of a $60.0 million revolving credit facility (the “Revolving Facility”), and a $350.0 million term loan facility (the “Term Loan”). On July 19, 2021, prior to the completion of the Distribution, the Company distributed approximately $16.5 million, representing the proceeds from the Term Loan, net of the repayment of related party debt due to SolarWinds Holdings, Inc., payment of intercompany trade payables, and fees and other transaction related costs, to SolarWinds. The Revolving Facility is primarily available for general corporate purposes. We had total borrowings of $392.3 million and $393.9 million as of June 30, 2026 and December 31, 2025, respectively, net of debt issuance costs of $5.7 million and $6.1 million, respectively. See Note 8. Debtin the Notes to Consolidated Financial Statements for further details regarding the Credit Agreement.

Current wording

In connection with the Separation and Distribution, on July 19, 2021, certain subsidiaries of the Company entered into a credit agreement (the “Credit Agreement”) with JPMorgan Chase Bank, N.A. as administrative agent and collateral agent and the lenders from time to time party thereto. The Credit Agreement originally provided for $410.0 million of first lien secured credit facilities (the “Credit Facilities”), consisting of a $60.0 million revolving credit facility (the “Revolving Facility”), and a $350.0 million term loan facility (the “Term Loan”), and was amended in November 2025 to, among other things, increase the aggregate principal amount under the Term Loan to $400.0 million. The Revolving Facility is primarily available for general corporate purposes. We had total borrowings of $392.7 million and $393.9 million as of September 30, 2026 and December 31, 2025, respectively, net of unamortized discount and debt issuance costs of $5.4 million and $6.1 million, respectively. See Note 8. Debtin the Notes to Consolidated Financial Statements for further details regarding the Credit Agreement.

Previous wording

In June 2026, we entered into an amendment to the Credit Agreement to add a delayed draw term loan facility (the “Delayed Draw Term Loan Facility”) with a committed borrowing availability of $75.0 million (the “Delayed Draw Term Loan”). The Credit Agreement, as amended, permits us to draw up to five times in the six months after the effective date of the amendment. Once funded, the Delayed Draw Term Loan’s maturity date and interest rate are equal to the existing Term Loan. As of June 30, 2026, there were no borrowings under the Delayed Draw Term Loan Facility. See Note 8. Debtin the Notes to Consolidated Financial Statements for further details regarding the Delayed Draw Term Loan Facility.

Current wording

In June 2026, we entered into an additional amendment to the Credit Agreement to add a delayed draw term loan facility (the “Delayed Draw Term Loan Facility”) with a committed borrowing availability of $75.0 million (the “Delayed Draw Term Loan”). The Credit Agreement, as amended, permits us to draw up to five times in the six months after the effective date of the amendment. Once funded, the Delayed Draw Term Loan’s maturity date and interest rate are equal to the existing Term Loan. As of September 30, 2026, there were no borrowings under the Delayed Draw Term Loan Facility.

Previous wording

On March 11, 2025, our board of directors approved a share repurchase program (the “Repurchase Program”) authorizing the repurchase of up to $75.0 million of our common stock, par value $0.001 per share (the “Common Stock”). The timing and total amount of stock repurchases will depend upon business, economic, and market conditions, corporate and regulatory requirements, prevailing stock prices, and other considerations. The Repurchase Program has no expiration date, may be suspended or discontinued at any time without notice, and does not obligate the Company to acquire any specific dollar amount or numbers of shares of Common Stock. Under the Repurchase Program, we repurchased 3,776,155 shares for $30.0 million during the year ended December 31, 2025. As of June 30, 2026, $45.0 million remained available for repurchases under the Repurchase Program. See Part II - Item 2. Unregistered Sales of Equity and Use of Proceedsfor additional information on the Repurchase Program.

Current wording

On March 11, 2025, our board of directors approved a share repurchase program (the “Repurchase Program”) authorizing the repurchase of up to $75.0 million of our common stock, par value $0.001 per share (the “Common Stock”). The timing and total amount of stock repurchases will depend upon business, economic, and market conditions, corporate and regulatory requirements, prevailing stock prices, and other considerations. The Repurchase Program has no expiration date, may be suspended or discontinued at any time without notice, and does not obligate the Company to acquire any specific dollar amount or numbers of shares of Common Stock. On August 26, 2026, our board of directors approved a $50.0 million increase to the Repurchase Program, increasing the total authorization to $125.0 million. Under the Repurchase Program, we repurchased 3,776,155 shares for $30.0 million during the year ended December 31, 2025. We repurchased 10,184,738 shares for $38.7 million during the three months ended September 30, 2026. As of September 30, 2026, $56.3 million remained available for repurchases under the Repurchase Program. See Part II - Item 2. Unregistered Sales of Equity Securities and Use of Proceedsfor additional information on the Repurchase Program.

Previous wording

Cash provided by operating activities increased for the six months ended June 30, 2026 as compared to the six months ended June 30, 2025, primarily due to an increase in net income of $11.9 million, offset in part by a decrease in net cash inflows resulting from changes in non-cash items within net loss of $8.7 million and an increase in net cash outflows resulting from changes in operating assets and liabilities of $3.1 million. The increase in net cash outflows resulting from changes in our operating assets and liabilities of $3.1 million was primarily due to increases in recoverable taxes and operating lease right-of-use assets, net and decreases in accrued liabilities and other, deferred revenue, income taxes payable, and other long-term liabilities, offset in part by decreases in current contract assets, accounts receivable, prepaid expenses and other current assets, other long-term assets, and income tax receivable and an increase in accounts payable.

Current wording

Cash provided by operating activities increased for the nine months ended September 30, 2026 as compared to the nine months ended September 30, 2025, primarily due to a decrease in net loss of $6.6 million and an increase in net cash inflows resulting from changes in operating assets and liabilities of $9.6 million, offset in part by a decrease in net cash inflows resulting from changes in non-cash items within net loss of $11.3 million. The increase in net cash inflows resulting from changes in our operating assets and liabilities of $9.6 million was primarily due to decreases in current contract assets, prepaid expenses and other current assets, accounts receivable, other long-term assets, and income tax receivable and increases in accounts payable and other long-term liabilities, offset in part by increases in recoverable taxes and operating lease right-of-use assets and decreases in deferred revenue, accrued liabilities and other, and income tax payable.

Previous wording

Investing cash flows consist of cash used for capital expenditures and intangible assets and cash provided by the return of deposits in escrow. Our capital expenditures principally relate to purchases of servers for cloud infrastructure primarily to support our data protection solutions, as well as leasehold improvements, computers and equipment to support our domestic and international office locations. Purchases of intangible assets consist of capitalized research and development costs.

Current wording

Investing cash flows consist of cash used for capital expenditures, intangible assets, and asset acquisitions and cash provided by the return of deposits in escrow. Our capital expenditures principally relate to purchases of servers for cloud infrastructure primarily to support our data protection solutions, as well as leasehold improvements, computers and equipment to support our domestic and international office locations. Purchases of intangible assets consist of capitalized research and development costs.