Klaviyo, Inc.

Previous wording

We have experienced rapid revenue growth in recent periods. Our revenue was $728.6 million and $572.9 million for the six months ended June 30, 2026 and 2025, respectively, representing a growth rate of 27.2%. Our rapid revenue growth has been driven by increases in our customer count, growth of existing customers, our expansion into international markets, our sales to mid-market and enterprise businesses, and the cross-selling of our text messaging and WhatsApp offerings alongside our data platform and email offering. We anticipate that our revenue growth rate will decelerate over time as a result of a variety of factors, including the maturation of our business, and you should not rely on our historical revenue growth as an indication of our future performance. Overall growth of our revenue depends on several factors, including our ability to:

Current wording

We have experienced rapid revenue growth in recent periods. Our revenue was $1,115.8 million and $883.8 million for the nine months ended September 30, 2026 and 2025, respectively, representing a growth rate of 26.2%. Our rapid revenue growth has been driven by increases in our customer count, growth of existing customers, our expansion into international markets, our sales to mid-market and enterprise businesses, and the cross-selling of our text messaging and WhatsApp offerings alongside our data platform and email offering. We anticipate that our revenue growth rate will decelerate over time as a result of a variety of factors, including the maturation of our business, and you should not rely on our historical revenue growth as an indication of our future performance. Overall growth of our revenue depends on several factors, including our ability to:

Previous wording

We have experienced rapid growth in our business since inception, and we may continue to experience rapid growth. Our headcount has grown significantly in recent years, reaching 2,400 employees as of June 30, 2026. In addition, we have been expanding our international operations since 2019. We opened offices in the United Kingdom and Australia in 2019 and 2022, respectively, and we expanded our presence in the European region by adding operations in Ireland in 2024. In 2025, we continued our expansion into the Asia Pacific and European regions by adding operations in Singapore and France, respectively. In 2026, we further expanded our North American presence by adding operations in Canada. We have also experienced significant growth in the number of customers using our platform, including the number of international customers, which increased from approximately 98,000 as of June 30, 2025 to approximately 115,000 as of June 30, 2026. We plan to continue to expand our international operations in the future. We have also experienced significant growth in the number of products, features, and messaging channels we offer (such as Reviews, Marketing Analytics, Advanced KDP, Composer, Customer Agent, Customer Hub, Helpdesk, and AI features, as well as additional messaging channels like text messaging, mobile push, and WhatsApp) and the usage and amount of data that our platform and associated infrastructure support. This growth in our business has placed and may continue to place significant demands on our operational infrastructure, financial resources, corporate culture, and management team.

Current wording

We have experienced rapid growth in our business since inception, and we may continue to experience rapid growth. Our headcount has grown significantly in recent years, reaching 2,406 employees as of September 30, 2026. In addition, we have been expanding our international operations since 2019. We opened offices in the United Kingdom and Australia in 2019 and 2022, respectively, and we expanded our presence in the European region by adding operations in Ireland in 2024. In 2025, we continued our expansion into the Asia Pacific and European regions by adding operations in Singapore and France, respectively. In 2026, we further expanded our North American and European presence by adding operations in Canada and Germany, respectively. We have also experienced significant growth in the number of customers using our platform, including the number of international customers, which increased from approximately 103,000 as of September 30, 2025 to approximately 118,000 as of September 30, 2026. We plan to continue to expand our international operations in the future. We have also experienced significant growth in the number of products, features, and messaging channels we offer (such as Reviews, Personalization, Advanced KDP, Composer, Customer Agent, Customer Hub, Helpdesk, and AI features, as well as additional messaging channels like text messaging, mobile push, and WhatsApp) and the usage and amount of data that our platform and associated infrastructure support. This growth in our business has placed and may continue to place significant demands on our operational infrastructure, financial resources, corporate culture, and management team.

Previous wording

Further, as our customer base continues to grow, we will need to expand our account management and customer service teams and continue to scale our platform. If we are not able to continue to provide high levels of customer service, our reputation could suffer, which could adversely affect our business, results of operations, and financial condition.

Current wording

Further, as our customer base continues to grow, we will need to continue to scale our platform and evolve the way our account management and customer service teams support our customers. If we are not able to continue to provide high levels of customer service, our reputation could suffer, which could adversely affect our business, results of operations, and financial condition.

Previous wording

•changes in search engine ranking algorithms or other search and discovery mechanisms used by potential customers;

Current wording

•changes in search engine ranking algorithms, AI-powered search and answer engines, or other search and discovery mechanisms used by potential customers, including changes that adversely affect the visibility or discoverability of our platform;

Previous wording

We incurred net losses of $31.8 million and $46.1 million in the fiscal years ended December 31, 2025 and 2024, respectively, a net loss of $8.8 million during the three months ended June 30, 2026, and net losses $24.3 million and $38.4 million during the three and six months ended June 30, 2025, respectively. We are not certain whether we will be able to maintain profitability in the future. Based on our current planned operations, we expect our cash and cash equivalents will enable us to fund our operating expenses for at least the next twelve months. We have based this estimate on assumptions that in the future may prove to be wrong, and we could use our capital resources sooner than we currently expect. We also expect our costs and expenses to increase in future periods as we continue to invest in our business and increase our product offerings, which could negatively affect our future results of operations if our revenue does not continue to increase. In particular, we intend to continue to expend substantial financial resources on:

Current wording

Based on our current planned operations, we expect our cash and cash equivalents will enable us to fund our operating expenses for at least the next twelve months. We have based this estimate on assumptions that in the future may prove to be wrong, and we could use our capital resources sooner than we currently expect. We also expect our costs and expenses to increase in future periods as we continue to invest in our business and increase our product offerings, which could negatively affect our future results of operations if our revenue does not continue to increase. In particular, we intend to continue to expend substantial financial resources on:

Previous wording

For the years ended December 31, 2025 and 2024, and the three and six months ended June 30, 2026, our research and development expenses were 23.6%, 25.4%, 24.8%, and 23.6% of our revenue, respectively. Research and development projects can be technically challenging and expensive, and require specialized personnel and significant computing infrastructure, particularly as we work to expand both the channels through which we offer our products and the use cases for our products beyond marketing and integrate resource-intensive technologies, such as AI and machine learning. In addition, our products have varying associated communication sending costs, and our research and development team may not be able to mitigate the impact of growth in any of those higher-cost channels, such as text messaging, by maintaining efficiency. These investments may adversely affect our operating margins and short-term profitability, and we may not realize the expected benefits. The nature of research and development cycles may cause us to experience delays between the time we incur expenses associated with research and development and the time we are able to offer compelling products and generate revenue, if any, from this investment. Additionally, anticipated customer demand for a product we are developing could decrease after the development cycle has commenced, and we would nonetheless be unable to avoid substantial costs associated with the development of any such product. If we expend a significant amount of resources on research and development and our efforts do not lead to the successful introduction or improvement of products that are competitive in our current or future markets or if we do not spend our research and development budget efficiently or effectively on compelling innovation and technologies, our competitive advantage may be adversely affected, which could materially adversely affect our business, financial condition, growth prospects, and results of operations.

Current wording

For the years ended December 31, 2025 and 2024, and the three and nine months ended September 30, 2026, our research and development expenses were 23.6%, 25.4%, 25.2%, and 24.2% of our revenue, respectively. Research and development projects can be technically challenging and expensive, and require specialized personnel and significant computing infrastructure, particularly as we work to expand both the channels through which we offer our products and the use cases for our products beyond marketing and integrate resource-intensive technologies, such as AI and machine learning. In addition, our products have varying associated communication sending costs, and our research and development team may not be able to mitigate the impact of growth in any of those higher-cost channels, such as text messaging, by maintaining efficiency. These investments may adversely affect our operating margins and short-term profitability, and we may not realize the expected benefits. The nature of research and development cycles may cause us to experience delays between the time we incur expenses associated with research and development and the time we are able to offer compelling products and generate revenue, if any, from this investment. Additionally, anticipated customer demand for a product we are developing could decrease after the development cycle has commenced, and we would nonetheless be unable to avoid substantial costs associated with the development of any such product. If we expend a significant amount of resources on research and development and our efforts do not lead to the successful introduction or improvement of products that are competitive in our current or future markets or if we do not spend our research and development budget efficiently or effectively on compelling innovation and technologies, our competitive advantage may be adversely affected, which could materially adversely affect our business, financial condition, growth prospects, and results of operations.

Previous wording

The future success of our business will depend, in part, on our ability to expand our customer base worldwide, and we are continuing to expand our international operations to increase our revenue from customers located outside of the United States as part of our growth strategy. For the three and six months ended June 30, 2026, we derived 41.8% and 41.6% of our revenue from customer accounts outside of the United States. We currently have international offices in the United Kingdom, Australia, Ireland, Singapore, and France, and we expect that we may in the future open additional offices internationally and hire employees to work at these offices in order to grow our business, reach new customers, and gain access to additional technical talent. Operating in international markets requires significant resources and management attention and will subject us to regulatory, economic, and political risks in addition to those we already face in the United States. Because of our limited experience with international operations as well as developing and managing sales in international markets, we may not succeed in marketing our products to potential customers internationally, as a result of which our international expansion efforts may not be successful, which could have a material adverse effect on our business, results of operations, and financial condition.

Current wording

The future success of our business will depend, in part, on our ability to expand our customer base worldwide, and we are continuing to expand our international operations to increase our revenue from customers located outside of the United States as part of our growth strategy. For the three and nine months ended September 30, 2026, we derived 42.1% and 41.8% of our revenue from customer accounts outside of the United States. We currently have international offices in the United Kingdom, Australia, Ireland, Singapore, and France, and we expect that we may in the future open additional offices internationally and hire employees to work at these offices in order to grow our business, reach new customers, and gain access to additional technical talent. Operating in international markets requires significant resources and management attention and will subject us to regulatory, economic, and political risks in addition to those we already face in the United States. Because of our limited experience with international operations as well as developing and managing sales in international markets, we may not succeed in marketing our products to potential customers internationally, as a result of which our international expansion efforts may not be successful, which could have a material adverse effect on our business, results of operations, and financial condition.

Previous wording

•the impact of the Share Repurchase Program on the trading price of our Series A common stock;

Current wording

•the impact of our share repurchase program on the trading price of our Series A common stock;

Previous wording

We have previously undertaken, and may in the future undertake, efforts to streamline our operations and improve cost efficiencies to align with our priorities. For example, in March 2023, we implemented a reduction-in-force affecting approximately 8% of our global workforce. We may not realize, in full or in part, the anticipated benefits, such as operational improvements and savings, from these efforts due to unforeseen difficulties, delays, unexpected costs, or diversion of management attention. If there are unforeseen expenses associated with these efforts and we incur unanticipated charges or liabilities, or if we are unable to realize the expected operational efficiencies and cost savings, our business, results of operations, and financial condition could be adversely affected.

Current wording

We have previously undertaken, and may in the future undertake, efforts to streamline our operations and improve cost efficiencies to align with our priorities. For example, in September 2026, we implemented a reduction-in-force affecting approximately 3% of our global workforce. We may not realize, in full or in part, the anticipated benefits, such as operational improvements and savings, from these efforts due to unforeseen difficulties, delays, unexpected costs, or diversion of management attention. If there are unforeseen expenses associated with these efforts and we incur unanticipated charges or liabilities, or if we are unable to realize the expected operational efficiencies and cost savings, our business, results of operations, and financial condition could be adversely affected.

Previous wording

As of December 31, 2025, we had approximately $1.0 billion of federal net operating losses (“NOLs”), which have an indefinite life. As of December 31, 2025, we had approximately $618.5 million of state NOLs. State NOLs have a definite life, with various expiration dates beginning in 2031. Under current law, federal NOLs generated in taxable years beginning after December 31, 2017, may be carried forward indefinitely, but the deductibility of such federal NOLs is limited to 80% of our taxable income annually for tax years beginning after December 31, 2020. NOLs generated prior to December 31, 2017, however, have a 20-year carryforward period, but are not subject to the 80% limitation. Due to certain executive option exercises as well as tax legislation impacts from the OBBBA, we anticipate NOLs to increase in the future.

Current wording

As of December 31, 2025, we had approximately $1.0 billion of federal net operating losses (“NOLs”), which have an indefinite life. As of December 31, 2025, we had approximately $618.5 million of state NOLs. State NOLs have a definite life, with various expiration dates beginning in 2031. Under current law, federal NOLs generated in taxable years beginning after December 31, 2017, may be carried forward indefinitely, but the deductibility of such federal NOLs is limited to 80% of our taxable income annually for tax years beginning after December 31, 2020. NOLs generated prior to December 31, 2017, however, have a 20-year carryforward period, but are not subject to the 80% limitation. Due to tax legislation impacts from the OBBBA, we anticipate NOLs to increase in the future.

Previous wording

We have in the past and may in the future seek to enter into joint ventures, or acquire or invest in new businesses, products, platform capabilities or technologies that we believe could complement our products or expand our platform capabilities, enhance our technical capabilities, or otherwise offer growth opportunities. For example, in October 2022, we acquired Napkin.io, a platform that provides developers an easy and secure way to write and deploy code, and in August 2025, we acquired Gatsby, a social automation product that helps brands convert engagement over social channels into owned customer relationships. In the future, we may not be able to find and identify desirable joint ventures, acquisition targets or business opportunities or be successful in entering into an agreement with any particular potential strategic partner. Additionally, any such venture, acquisition or investment may divert the attention of management and cause us to incur various expenses in identifying, investigating, and pursuing suitable opportunities, whether or not the transactions are completed, and may result in unforeseen operating difficulties and expenditures. We may also inherit liabilities or obligations of acquired companies that we are unable to successfully mitigate, including issues related to intellectual property, data privacy, tax, or regulatory compliance, which may not be discovered during our due diligence. In particular, we may encounter difficulties assimilating or integrating the businesses, technologies, products and platform capabilities, personnel or operations of any acquired companies, particularly if the key personnel of an acquired company choose not to work for us, if their technology is not easily adapted to work with our platform or our products, if we experience difficulties in integrating their financial reporting and internal controls, or if we have difficulty retaining the customers of any acquired business due to changes in ownership, management or otherwise. Cultural challenges associated with integrating employees from acquired companies may also result in the loss of key personnel or decreased productivity. These transactions may also disrupt our business, divert our resources, and require significant management attention that would otherwise be available for the development of our existing business. Any such transactions that we are able to complete may not result in any synergies or other benefits we had expected to achieve, which could result in impairment charges that could be substantial. These transactions could also result in dilutive issuances of equity securities or the incurrence of debt, which could adversely affect our business, financial condition, and results of operations. In addition, if the resulting business from such a transaction fails to meet our expectations, our business, financial condition, and results of operations may be adversely affected, or we may be exposed to unknown risks or liabilities.

Current wording

We have in the past and may in the future seek to enter into joint ventures, or acquire or invest in new businesses, products, platform capabilities or technologies that we believe could complement our products or expand our platform capabilities, enhance our technical capabilities, or otherwise offer growth opportunities. For example, in August 2025, we acquired Gatsby, a social automation product that helps brands convert engagement over social channels into owned customer relationships, and in August 2026, we acquired the team and technology of Agency, an AI-native customer success company. In the future, we may not be able to find and identify desirable joint ventures, acquisition targets or business opportunities or be successful in entering into an agreement with any particular potential strategic partner. Additionally, any such venture, acquisition or investment may divert the attention of management and cause us to incur various expenses in identifying, investigating, and pursuing suitable opportunities, whether or not the transactions are completed, and may result in unforeseen operating difficulties and expenditures. We may also inherit liabilities or obligations of acquired companies that we are unable to successfully mitigate, including issues related to intellectual property, data privacy, tax, or regulatory compliance, which may not be discovered during our due diligence. In particular, we may encounter difficulties assimilating or integrating the businesses, technologies, products and platform capabilities, personnel or operations of any acquired companies, particularly if the key personnel of an acquired company choose not to work for us, if their technology is not easily adapted to work with our platform or our products, if we experience difficulties in integrating their financial reporting and internal controls, or if we have difficulty retaining the customers of any acquired business due to changes in ownership, management or otherwise. Cultural challenges associated with integrating employees from acquired companies may also result in the loss of key personnel or decreased productivity. These transactions may also disrupt our business, divert our resources, and require significant management attention that would otherwise be available for the development of our existing business. Any such transactions that we are able to complete may not result in any synergies or other benefits we had expected to achieve, which could result in impairment charges that could be substantial. These transactions could also result in dilutive issuances of equity securities or the incurrence of debt, which could adversely affect our business, financial condition, and results of operations. In addition, if the resulting business from such a transaction fails to meet our expectations, our business, financial condition, and results of operations may be adversely affected, or we may be exposed to unknown risks or liabilities.

Previous wording

State legislatures also have been adopting new privacy laws or amending existing laws with increasing frequency, requiring attention to frequently changing regulatory requirements, and we expect that this trend will continue. For example, the California Consumer Privacy Act (the “CCPA”) imposed a number of requirements on covered businesses and gave California residents certain rights related to their personal information, including the right to access and delete their personal information, to receive detailed information about how their personal information is used and shared, and to opt out of certain sharing of their personal information. The CCPA provides for civil penalties for violations of up to $7,500 for each intentional violation and created a private right of action for certain data breaches that is expected to increase data breach litigation. In addition, the California Privacy Rights Act (the “CPRA”), which has been in effect since January 1, 2023, imposed additional obligations on companies covered by the CCPA. The CPRA significantly modified the CCPA, including by expanding consumers’ rights with respect to certain sensitive personal information. Similar comprehensive privacy laws have been proposed and passed in numerous other states. These comprehensive privacy laws have entered into force in many states, and several more will be entering into force in the coming years. Such proposed legislation, if enacted, may add additional complexity, variation in requirements, restrictions, and potential legal risk, require additional investment of resources in compliance programs, impact strategies, and the availability of previously useful data and could result in increased compliance costs and/or changes in business practices and policies.

Current wording

State legislatures also have been adopting new privacy laws or amending existing laws with increasing frequency, requiring attention to frequently changing regulatory requirements, and we expect that this trend will continue. For example, the California Consumer Privacy Act, as amended (the “CCPA”), imposes a number of requirements on covered businesses and gave California residents certain rights related to their personal information, including the right to access and delete their personal information, to receive detailed information about how their personal information is used and shared, and to opt out of certain sharing of their personal information. The CCPA provides for civil penalties for violations of up to $7,500 for each intentional violation and created a private right of action for certain data breaches that is expected to increase data breach litigation. Similar comprehensive privacy laws have been proposed and passed in numerous other states. These comprehensive privacy laws have entered into force in many states, and several more will be entering into force in the coming years. Such proposed legislation, if enacted, may add additional complexity, variation in requirements, restrictions, and potential legal risk, require additional investment of resources in compliance programs, impact strategies, and the availability of previously useful data and could result in increased compliance costs and/or changes in business practices and policies.

Previous wording

Some inbox service providers categorize emails that originate from email marketing platforms as “promotional” and, as a result, direct them to an alternate or “tabbed” section of the recipient’s inbox. Additionally, inbox service providers can block emails from reaching their users. While we continually improve our own technology and work closely with inbox service providers and our customers to maintain our deliverability rates, the implementation of new or more restrictive policies by inbox service providers may make it more difficult to deliver our customers’ emails, particularly if we or our customers are not given adequate notice of a change in policy or struggle to update our platform or products to comply with the changed policy in a reasonable amount of time. For example, in October 2023, Google and Yahoo announced new email sender requirements that impact customers of email marketing platforms, including our platform. Since February 2024, Google and Yahoo have required bulk senders to authenticate their emails following certain industry standard authentication systems, enable recipients to easily unsubscribe, and ensure they only send wanted emails and stay under a certain spam rate threshold. As inbox service providers increasingly utilize AI and machine learning to manage inbox filtering, our ability to predict deliverability or optimize for these algorithms may be diminished. Our customers that fail to comply with these new requirements may have their emails blocked from reaching their customers by Google or Yahoo and may not be able to effectively use our platform. If we or our customers fail to comply with new inbox service provider requirements, if inbox service providers materially limit or halt the delivery of our customers’ emails, if we fail to deliver our customers’ emails in a manner compatible with inbox service providers’ email handling or authentication technologies or other policies, if the open, unsubscribe, spam rates, or other engagement metrics of our customers’ emails or the functionality of our platform are negatively impacted by the actions of inbox service providers to categorize or block emails or new policies or requirements imposed by inbox service providers, or if our customers send fewer emails or send emails to or maintain fewer profiles on our platform as a result of new inbox service provider requirements, then customers may question the effectiveness of our platform and downgrade or cancel their subscriptions. This could harm our business, financial condition, and results of operations.

Current wording

Some inbox service providers categorize emails that originate from email marketing platforms as “promotional” and, as a result, direct them to an alternate or “tabbed” section of the recipient’s inbox. Additionally, inbox service providers can block emails from reaching their users. While we continually improve our own technology and work closely with inbox service providers and our customers to maintain our deliverability rates, the implementation of new or more restrictive policies by inbox service providers may make it more difficult to deliver our customers’ emails, particularly if we or our customers are not given adequate notice of a change in policy or struggle to update our platform or products to comply with the changed policy in a reasonable amount of time. For example, in October 2023, Google and Yahoo announced new email sender requirements that impact customers of email marketing platforms, including our platform. Since February 2024, Google and Yahoo have required bulk senders to authenticate their emails following certain industry standard authentication systems, enable recipients to easily unsubscribe, and ensure they only send wanted emails and stay under a certain spam rate threshold. As inbox service providers increasingly utilize AI and machine learning to manage inbox filtering, our ability to predict deliverability or optimize for these algorithms may be diminished. Our customers that fail to comply with these requirements may have their emails blocked from reaching their customers by Google or Yahoo and may not be able to effectively use our platform. If we or our customers fail to comply with new inbox service provider requirements, if inbox service providers materially limit or halt the delivery of our customers’ emails, if we fail to deliver our customers’ emails in a manner compatible with inbox service providers’ email handling or authentication technologies or other policies, if the open, unsubscribe, spam rates, or other engagement metrics of our customers’ emails or the functionality of our platform are negatively impacted by the actions of inbox service providers to categorize or block emails or new policies or requirements imposed by inbox service providers, or if our customers send fewer emails or send emails to or maintain fewer profiles on our platform as a result of new inbox service provider requirements, then customers may question the effectiveness of our platform and downgrade or cancel their subscriptions. This could harm our business, financial condition, and results of operations.

Previous wording

We have incorporated, and expect to continue to incorporate, AI technology into our products and services, including our Marketing, Service, and Analytics offerings and our Reviews add-on, and this incorporation of AI technology in our business and operations may become more significant over time. Generative AI and autonomous AI agents can produce content, analyses, or recommendations with limited or no human intervention, and may take or suggest actions based on incomplete or inaccurate data, AI hallucinations, or flawed training inputs, which may expose us to additional risk, such as damage to our reputation, competitive position, additional costs, and other business, legal and regulatory risks. For example, certain generative AI technology use machine learning and other predictive analysis techniques, which can produce inaccurate, incomplete, or misleading content, unintended biases, and other discriminatory or unexpected results, errors or inadequacies, any of which may not be easily detectable by us or any of our related service providers. Additionally, our AI models and agents may be subject to adversarial attacks, such as prompt injection or data poisoning, where third parties manipulate inputs to generate malicious or unauthorized outputs. Accordingly, while these AI-powered applications may help provide more tailored or personalized user experiences, if the content, analyses, or recommendations produced by AI-powered applications are, or are perceived to be, deficient, inaccurate, biased, unethical or otherwise flawed, our reputation, competitive position, and business may be materially and adversely affected. In addition, we may adopt and deploy autonomous AI agents as part of product offerings to customers and for our own internal business operations. These autonomous AI agents may operate with limited human oversight and can produce inaccurate, biased, or otherwise unintended results that are not easily detectable or correctable. As such agents perform or automate customer engagement or other decision-making functions, their actions could generate or disseminate false, misleading, or inappropriate content, or otherwise result in conduct inconsistent with customer expectations or applicable laws. If the outputs or actions of our AI agents are, or are perceived to be, flawed, unethical, or unreliable, our reputation, customer relationships, and competitive position could be adversely affected.

Current wording

We have incorporated, and expect to continue to incorporate, AI technology into our products and services, including our Composer, Customer Agent, Marketing, Service, and Data and Personalization offerings, and this incorporation of AI technology in our business and operations may become more significant over time. Generative AI and autonomous AI agents can produce content, analyses, or recommendations with limited or no human intervention, and may take or suggest actions based on incomplete or inaccurate data, AI hallucinations, or flawed training inputs, which may expose us to additional risk, such as damage to our reputation, competitive position, additional costs, and other business, legal and regulatory risks. For example, certain generative AI technology use machine learning and other predictive analysis techniques, which can produce inaccurate, incomplete, or misleading content, unintended biases, and other discriminatory or unexpected results, errors or inadequacies, any of which may not be easily detectable by us or any of our related service providers. Additionally, our AI models and agents may be subject to adversarial attacks, such as prompt injection or data poisoning, where third parties manipulate inputs to generate malicious or unauthorized outputs. Accordingly, while these AI-powered applications may help provide more tailored or personalized user experiences, if the content, analyses, or recommendations produced by AI-powered applications are, or are perceived to be, deficient, inaccurate, biased, unethical or otherwise flawed, our reputation, competitive position, and business may be materially and adversely affected. In addition, we may adopt and deploy autonomous AI agents as part of product offerings to customers and for our own internal business operations. These autonomous AI agents may operate with limited human oversight and can produce inaccurate, biased, or otherwise unintended results that are not easily detectable or correctable. As such agents perform or automate customer engagement or other decision-making functions, their actions could generate or disseminate false, misleading, or inappropriate content, or otherwise result in conduct inconsistent with customer expectations or applicable laws. If the outputs or actions of our AI agents are, or are perceived to be, flawed, unethical, or unreliable, our reputation, customer relationships, and competitive position could be adversely affected.

Previous wording

In addition, new laws and regulations, or the interpretation of existing laws and regulations, in any of the jurisdictions in which we operate may affect our use of AI technology and expose us to government enforcement or civil lawsuits. For example, states such as California, Colorado, and Utah have recently passed laws regulating the use of AI technology, which impose additional operational burdens and may require us to modify our products and services that utilize AI technology in order to comply with these laws. Federal regulators have also issued guidance concerning the use of AI technology in regulated sectors. Recent federal executive actions have signaled support for a federal moratorium on the enforcement of certain state AI laws, including through a December 11, 2025 executive order on “Ensuring a National Policy Framework for Artificial Intelligence.” To date, these efforts have not resulted in federal preemption of state action on AI regulation, contributing to a complicated legislative patchwork, which may be litigated in state and federal courts. In addition, there have been notable developments outside the United States. In Europe, the EU’s Artificial Intelligence Act (“AI Act”), the world’s first comprehensive AI law, entered into force on August 1, 2024, with phased application of its provisions from February 2025 through August 2027 and with most provisions becoming effective on August 2, 2026. The AI Act, which may be amended or further clarified as part of the EU’s Digital Omnibus or related legislative initiatives, imposes significant obligations on providers and deployers of certain high-risk AI systems and encourages providers and deployers of AI systems to account for EU ethical principles in their development and use of these systems. We expect these legislative trends to continue, and we may be required to devote significant attention and resources to address the frequently changing regulatory requirements, including by ensuring higher standards of data quality, transparency, and human oversight, as well as adhering to specific and potentially burdensome and costly ethical, accountability, and administrative requirements. As the legal and regulatory framework relating to the use of AI technology continues to change, there may be an increase in our operational and development expenses that could impact our ability to earn revenue from or utilize certain AI technology.

Current wording

In addition, new laws and regulations, or the interpretation of existing laws and regulations, in any of the jurisdictions in which we operate may affect our use of AI technology and expose us to government enforcement or civil lawsuits. For example, states such as California, Colorado, and Utah have recently passed laws regulating the use of AI technology, which impose additional operational burdens and may require us to modify our products and services that utilize AI technology in order to comply with these laws. Federal regulators have also issued guidance concerning the use of AI technology in regulated sectors. Recent federal executive actions have signaled support for a federal moratorium on the enforcement of certain state AI laws, including through a December 11, 2025 executive order on “Ensuring a National Policy Framework for Artificial Intelligence.” To date, these efforts have not resulted in federal preemption of state action on AI regulation, contributing to a complicated legislative patchwork, which may be litigated in state and federal courts. In addition, there have been notable developments outside the United States. In Europe, the EU’s Artificial Intelligence Act (“AI Act”), the world’s first comprehensive AI law, entered into force on August 1, 2024, with phased application of its provisions from February 2025 through August 2028. In July 2026, the EU adopted the Digital Omnibus on AI, which amended the AI Act to, among other things, defer the application of most obligations for high-risk AI systems from August 2, 2026 to December 2, 2027 (or August 2, 2028 for AI systems embedded in certain regulated products). Other provisions were not deferred, including transparency obligations that have applied since August 2, 2026, such as requirements to disclose to individuals that they are interacting with an AI system and to label certain AI-generated content. The AI Act, which may be amended or further clarified as part of the EU’s Digital Omnibus or related legislative initiatives, imposes significant obligations on providers and deployers of certain high-risk AI systems and encourages providers and deployers of AI systems to account for EU ethical principles in their development and use of these systems. We expect these legislative trends to continue, and we may be required to devote significant attention and resources to address the frequently changing regulatory requirements, including by ensuring higher standards of data quality, transparency, and human oversight, as well as adhering to specific and potentially burdensome and costly ethical, accountability, and administrative requirements. As the legal and regulatory framework relating to the use of AI technology continues to change, there may be an increase in our operational and development expenses that could impact our ability to earn revenue from or utilize certain AI technology.

Previous wording

Our Series B common stock has ten votes per share, and our Series A common stock has one vote per share. Our directors, executive officers, and their affiliates, beneficially own in the aggregate 64.7% of the voting power of our capital stock as of June 30, 2026. Our co-founders, Andrew Bialecki and Ed Hallen, beneficially own 47.7% and 20.3%, respectively, of our Series B common stock and together 68.0% of our Series B common stock as of June 30, 2026. As such, our co-founders individually or together hold significant influence and control over matters requiring the vote of our stockholders including the sale, merger or acquisition of our company. Because of the ten-to-one voting ratio between our Series B and Series A common stock, the holders of our Series B common stock collectively continue to control a majority of the combined voting power of our common stock and therefore are able to continue to control all matters submitted to our stockholders for approval until the seventh anniversary of our initial public offering ("IPO"), when all outstanding shares of our Series A common stock and Series B common stock will convert automatically into shares of a single series of common stock, or until they no longer hold a majority of the combined voting power of our common stock. The holders of our Series B common stock may have interests that differ from yours and may vote in a way with which you disagree and which may be adverse to your interests. Additionally, the Share Repurchase Program may reduce our public float and further concentrate ownership among our directors, executive officers, and their affiliates. This concentrated control may limit or preclude your ability to influence corporate matters for the foreseeable future, including the election of directors, amendments of our organizational documents, and any merger, consolidation, sale of all or substantially all of our assets or other major corporate transaction requiring stockholder approval. In addition, this concentrated control may prevent or discourage unsolicited acquisition proposals or offers for our capital stock that you may believe are in your best interest as one of our stockholders, and could deprive our stockholders of an opportunity to receive a premium for their shares as part of a sale of our company.

Current wording

Our Series B common stock has ten votes per share, and our Series A common stock has one vote per share. Our directors, executive officers, and their affiliates, beneficially own in the aggregate 66.2% of the voting power of our capital stock as of September 30, 2026. Our co-founders, Andrew Bialecki and Ed Hallen, beneficially own 49.8% and 21.1%, respectively, of our Series B common stock and together 70.9% of our Series B common stock as of September 30, 2026. As such, our co-founders individually or together hold significant influence and control over matters requiring the vote of our stockholders including the sale, merger or acquisition of our company. Because of the ten-to-one voting ratio between our Series B and Series A common stock, the holders of our Series B common stock collectively continue to control a majority of the combined voting power of our common stock and therefore are able to continue to control all matters submitted to our stockholders for approval until the seventh anniversary of our initial public offering ("IPO"), when all outstanding shares of our Series A common stock and Series B common stock will convert automatically into shares of a single series of common stock, or until they no longer hold a majority of the combined voting power of our common stock. The holders of our Series B common stock may have interests that differ from yours and may vote in a way with which you disagree and which may be adverse to your interests. Additionally, our share repurchase program may reduce our public float and further concentrate ownership among our directors, executive officers, and their affiliates. This concentrated control may limit or preclude your ability to influence corporate matters for the foreseeable future, including the election of directors, amendments of our organizational documents, and any merger, consolidation, sale of all or substantially all of our assets or other major corporate transaction requiring stockholder approval. In addition, this concentrated control may prevent or discourage unsolicited acquisition proposals or offers for our capital stock that you may believe are in your best interest as one of our stockholders, and could deprive our stockholders of an opportunity to receive a premium for their shares as part of a sale of our company.

Previous wording

The Share Repurchase Program could impact the trading price, liquidity, and ownership concentration of our Series A common stock.

Current wording

Our share repurchase program could impact the trading price, liquidity, and ownership concentration of our Series A common stock.

Previous wording

The Share Repurchase Program may affect the trading price of our Series A common stock. Repurchases reduce the number of shares outstanding and the amount of stock available for trading, which could decrease our public float and overall liquidity. As a result, the trading price of our Series A common stock may become more volatile and investors may find it more difficult to buy or sell shares in the open market. In addition, the Share Repurchase Program may further concentrate ownership among our directors, executive officers, and their affiliates, which could increase their relative influence over corporate matters and limit the ability of other stockholders to affect the outcome of stockholder votes.

Current wording

On November 4, 2026, we announced that our board of directors authorized a new share repurchase program for up to $300 million of shares of Series A common stock. There can be no assurance that we will repurchase shares at favorable prices. Further, our share repurchase program may affect the trading price of our Series A common stock. Repurchases reduce the number of shares outstanding and the amount of stock available for trading, which could decrease our public float and overall liquidity. As a result, the trading price of our Series A common stock may become more volatile and investors may find it more difficult to buy or sell shares in the open market. In addition, our share repurchase program may further concentrate ownership among our directors, executive officers, and their affiliates, which could increase their relative influence over corporate matters and limit the ability of other stockholders to affect the outcome of stockholder votes.

Previous wording

In addition, as of June 30, 2026, we had 1,397,355 options outstanding that, if fully exercised, would result in the issuance of an equal number of shares of Series B common stock, as well as 494,093 shares of Series B common stock and 21,827,236 shares of Series A common stock subject to outstanding RSU and PSU awards. Shares of Series B common stock will automatically convert into shares of Series A common stock upon certain transfers and other events. All of the shares of Series B common stock issuable upon the exercise of stock options or the vesting of RSU awards and the shares reserved for future issuance under our equity incentive plans have been registered on a registration statement on Form S-8 under the Securities Act. Accordingly, following conversion to shares of Series A common stock, these shares can be freely sold in the public market upon issuance, subject to volume limitations under Rule 144 for our executive officers and directors and applicable vesting requirements. The market price of our Series A common stock could also be adversely affected by the vesting and settlement of RSUs and PSUs and the exercise of stock options, which may result in the sale of a significant number of shares to satisfy tax withholding obligations (commonly referred to as “sell-to-cover” transactions), creating short-term selling pressure.

Current wording

In addition, as of September 30, 2026, we had 1,351,578 options outstanding that, if fully exercised, would result in the issuance of an equal number of shares of Series B common stock, as well as 275,339 shares of Series B common stock and 22,190,601 shares of Series A common stock subject to outstanding RSU and PSU awards. Shares of Series B common stock will automatically convert into shares of Series A common stock upon certain transfers and other events. All of the shares of Series B common stock issuable upon the exercise of stock options or the vesting of RSU awards and the shares reserved for future issuance under our equity incentive plans have been registered on a registration statement on Form S-8 under the Securities Act. Accordingly, following conversion to shares of Series A common stock, these shares can be freely sold in the public market upon issuance, subject to volume limitations under Rule 144 for our executive officers and directors and applicable vesting requirements. The market price of our Series A common stock could also be adversely affected by the vesting and settlement of RSUs and PSUs and the exercise of stock options, which may result in the sale of a significant number of shares to satisfy tax withholding obligations (commonly referred to as “sell-to-cover” transactions), creating short-term selling pressure.