# BENTLEY SYSTEMS INC (BSY) Informational only - not investment advice. CIK: 0001031308 SIC: 7372 Services-Prepackaged Software SIC breadcrumb: [Services](/division/I/) > [Business Services](/major-group/73/) > [SIC 7372 Services-Prepackaged Software](/industry/7372/) Latest 10-K filed: 2026-02-26 SEC page: https://www.sec.gov/edgar/browse/?CIK=1031308 Filing source: https://www.sec.gov/Archives/edgar/data/1031308/000103130826000007/bsy-20251231.htm ## Selected Fundamentals | Metric | Value | Unit | FY | Filed | | --- | ---: | --- | ---: | --- | | Revenue | 1501779000 | USD | 2025 | 2026-02-26 | | Net income | 277861000 | USD | 2025 | 2026-02-26 | | Assets | 3555167000 | USD | 2025 | 2026-02-26 | ## Financials Annual standardized facts from SEC companyfacts as of latest extracted filing date 2026-02-26. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001031308.json. Derived margins are computed from the extracted annual SEC facts. | Metric | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | | --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | | Revenue | | 691,710,000 | 736,654,000 | 801,544,000 | 965,046,000 | 1,099,082,000 | 1,228,413,000 | 1,353,095,000 | 1,501,779,000 | | Net income | | 142,112,000 | 103,096,000 | 126,521,000 | 93,192,000 | 174,780,000 | 326,787,000 | 234,787,000 | 277,861,000 | | Operating income | | 121,391,000 | 141,865,000 | 150,150,000 | 94,589,000 | 208,612,000 | 230,542,000 | 302,150,000 | 362,621,000 | | Gross profit | | 560,386,000 | 592,504,000 | 634,389,000 | 748,507,000 | 862,069,000 | 962,330,000 | 1,095,328,000 | 1,224,249,000 | | Diluted EPS | | 0.49 | 0.35 | 0.42 | 0.30 | 0.55 | 1.00 | 0.72 | 0.85 | | Assets | | | 994,599,000 | 1,126,035,000 | 2,659,243,000 | 3,165,005,000 | 3,319,850,000 | 3,399,807,000 | 3,555,167,000 | | Liabilities | | | 659,980,000 | 784,436,000 | 2,250,021,000 | 2,591,551,000 | 2,435,868,000 | 2,358,687,000 | 2,365,675,000 | | Stockholders' equity | 52,167,000 | 147,431,000 | 334,619,000 | 341,599,000 | 409,222,000 | | 883,278,000 | 1,040,987,000 | 1,189,413,000 | | Cash and cash equivalents | | | 121,101,000 | 122,006,000 | 329,337,000 | 71,684,000 | 68,412,000 | 64,009,000 | 123,278,000 | | Net margin | | 20.55% | 14.00% | 15.78% | 9.66% | 15.90% | 26.60% | 17.35% | 18.50% | | Operating margin | | 17.55% | 19.26% | 18.73% | 9.80% | 18.98% | 18.77% | 22.33% | 24.15% | ## Quarterly Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-05-07. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001031308.json. Flow metrics use discrete quarter-length periods from 10-Q/10-Q/A filings. Q4 revenue and net income are derived only when annual FY and nine-month YTD facts exist for the same fiscal year; derived Q4 values are labeled. EPS Q4 is not derived. | Quarter | End date | Revenue | Net income | Diluted EPS | Method | | --- | --- | ---: | ---: | ---: | --- | | 2022-Q2 | 2022-06-30 | | | 0.17 | reported discrete quarter | | 2022-Q3 | 2022-09-30 | | | 0.12 | reported discrete quarter | | 2023-Q1 | 2023-03-31 | | | 0.14 | reported discrete quarter | | 2023-Q2 | 2023-06-30 | 296,749,000 | 48,685,000 | 0.15 | reported discrete quarter | | 2023-Q3 | 2023-09-30 | 306,612,000 | 53,027,000 | 0.16 | reported discrete quarter | | 2023-Q4 | 2023-12-31 | 310,641,000 | 179,585,000 | | derived Q4 = FY annual - nine-month YTD | | 2024-Q1 | 2024-03-31 | 337,763,000 | 70,310,000 | 0.22 | reported discrete quarter | | 2024-Q2 | 2024-06-30 | 330,337,000 | 72,046,000 | 0.22 | reported discrete quarter | | 2024-Q3 | 2024-09-30 | 335,173,000 | 42,338,000 | 0.13 | reported discrete quarter | | 2024-Q4 | 2024-12-31 | 349,822,000 | 50,093,000 | | derived Q4 = FY annual - nine-month YTD | | 2025-Q1 | 2025-03-31 | 370,542,000 | 91,368,000 | 0.28 | reported discrete quarter | | 2025-Q2 | 2025-06-30 | 364,106,000 | 70,482,000 | 0.22 | reported discrete quarter | | 2025-Q3 | 2025-09-30 | 375,549,000 | 57,373,000 | 0.18 | reported discrete quarter | | 2025-Q4 | 2025-12-31 | 391,582,000 | 58,638,000 | | derived Q4 = FY annual - nine-month YTD | | 2026-Q1 | 2026-03-31 | 424,181,000 | 95,386,000 | 0.30 | reported discrete quarter | ## Macro Cross-References - [CPIAUCSL](/indicator/CPIAUCSL/): Consumer Price Index for All Urban Consumers: All Items in U.S. City Average - [UNRATE](/indicator/UNRATE/): Unemployment Rate - [FEDFUNDS](/indicator/FEDFUNDS/): Federal Funds Effective Rate - [CES0500000003](/indicator/CES0500000003/): Average Hourly Earnings of All Employees, Total Private - [DFEDTARU](/indicator/DFEDTARU/): Federal Funds Target Range - Upper Limit - [DFEDTARL](/indicator/DFEDTARL/): Federal Funds Target Range - Lower Limit - [DGS3MO](/indicator/DGS3MO/): Market Yield on U.S. Treasury Securities at 3-Month Constant Maturity - [DGS2](/indicator/DGS2/): Market Yield on U.S. Treasury Securities at 2-Year Constant Maturity - [DGS10](/indicator/DGS10/): Market Yield on U.S. Treasury Securities at 10-Year Constant Maturity - [DGS30](/indicator/DGS30/): Market Yield on U.S. Treasury Securities at 30-Year Constant Maturity - [T10Y2Y](/indicator/T10Y2Y/): 10-Year Treasury Constant Maturity Minus 2-Year Treasury Constant Maturity - [CPILFESL](/indicator/CPILFESL/): Consumer Price Index for All Urban Consumers: All Items Less Food and Energy - [CPIUFDSL](/indicator/CPIUFDSL/): Consumer Price Index for All Urban Consumers: Food - [CPIENGSL](/indicator/CPIENGSL/): Consumer Price Index for All Urban Consumers: Energy - [CUSR0000SAH1](/indicator/CUSR0000SAH1/): Consumer Price Index for All Urban Consumers: Shelter - [PCEPI](/indicator/PCEPI/): Personal Consumption Expenditures: Chain-type Price Index - [PCEPILFE](/indicator/PCEPILFE/): Personal Consumption Expenditures Excluding Food and Energy: Chain-type Price Index - [PPIACO](/indicator/PPIACO/): Producer Price Index by Commodity: All Commodities - [T10YIE](/indicator/T10YIE/): 10-Year Breakeven Inflation Rate - [U6RATE](/indicator/U6RATE/): Total Unemployed, Plus All Marginally Attached Workers Plus Total Employed Part Time for Economic Reasons - [PAYEMS](/indicator/PAYEMS/): All Employees, Total Nonfarm - [CIVPART](/indicator/CIVPART/): Labor Force Participation Rate - [EMRATIO](/indicator/EMRATIO/): Employment-Population Ratio - [UNEMPLOY](/indicator/UNEMPLOY/): Unemployed - [CE16OV](/indicator/CE16OV/): Employment Level - [ICSA](/indicator/ICSA/): Initial Claims - [JTSJOL](/indicator/JTSJOL/): Job Openings: Total Nonfarm - [JTSQUR](/indicator/JTSQUR/): Quits: Total Nonfarm - [GDPC1](/indicator/GDPC1/): Real Gross Domestic Product - [A191RL1Q225SBEA](/indicator/A191RL1Q225SBEA/): Real Gross Domestic Product: Percent Change from Preceding Period - [INDPRO](/indicator/INDPRO/): Industrial Production: Total Index - [TCU](/indicator/TCU/): Capacity Utilization: Total Index - [HOUST](/indicator/HOUST/): New Privately-Owned Housing Units Started: Total Units - [PERMIT](/indicator/PERMIT/): New Privately-Owned Housing Units Authorized in Permit-Issuing Places: Total Units - [RSAFS](/indicator/RSAFS/): Advance Retail Sales: Retail Trade - [PCE](/indicator/PCE/): Personal Consumption Expenditures - [DSPIC96](/indicator/DSPIC96/): Real Disposable Personal Income - [PSAVERT](/indicator/PSAVERT/): Personal Saving Rate - [M2SL](/indicator/M2SL/): M2 - [BOPGSTB](/indicator/BOPGSTB/): U.S. International Trade in Goods and Services: Balance - [MSPUS](/indicator/MSPUS/): Median Sales Price of Houses Sold for the United States - [HSN1F](/indicator/HSN1F/): New One Family Houses Sold: United States - [RHORUSQ156N](/indicator/RHORUSQ156N/): Homeownership Rate in the United States - [TTLCONS](/indicator/TTLCONS/): Total Construction Spending: Total Construction in the United States - [RRVRUSQ156N](/indicator/RRVRUSQ156N/): Rental Vacancy Rate in the United States - [TOTALSL](/indicator/TOTALSL/): Total Consumer Credit Owned and Securitized - [REVOLSL](/indicator/REVOLSL/): Revolving Consumer Credit Owned and Securitized - [DRCCLACBS](/indicator/DRCCLACBS/): Delinquency Rate on Credit Card Loans, All Commercial Banks - [GDP](/indicator/GDP/): Gross Domestic Product - [GPDI](/indicator/GPDI/): Gross Private Domestic Investment - [GCE](/indicator/GCE/): Government Consumption Expenditures and Gross Investment - [PCEC](/indicator/PCEC/): Personal Consumption Expenditures - [NETEXP](/indicator/NETEXP/): Net Exports of Goods and Services - [GFDEBTN](/indicator/GFDEBTN/): Federal Debt: Total Public Debt - [GFDEGDQ188S](/indicator/GFDEGDQ188S/): Federal Debt: Total Public Debt as Percent of Gross Domestic Product - [FYFSD](/indicator/FYFSD/): Federal Surplus or Deficit - [FGRECPT](/indicator/FGRECPT/): Federal Government Current Receipts - [FGEXPND](/indicator/FGEXPND/): Federal Government: Current Expenditures - [MANEMP](/indicator/MANEMP/): All Employees, Manufacturing - [USCONS](/indicator/USCONS/): All Employees, Construction - [USTRADE](/indicator/USTRADE/): All Employees, Retail Trade - [USFIRE](/indicator/USFIRE/): All Employees, Financial Activities - [USGOVT](/indicator/USGOVT/): All Employees, Government - [AWHAETP](/indicator/AWHAETP/): Average Weekly Hours of All Employees, Total Private - [DGORDER](/indicator/DGORDER/): Manufacturers' New Orders: Durable Goods - [NEWORDER](/indicator/NEWORDER/): Manufacturers' New Orders: Nondefense Capital Goods Excluding Aircraft - [BUSINV](/indicator/BUSINV/): Total Business Inventories - [EXPGS](/indicator/EXPGS/): Exports of Goods and Services - [IMPGS](/indicator/IMPGS/): Imports of Goods and Services - [IR](/indicator/IR/): Import Price Index (End Use): All Commodities - [PPIFIS](/indicator/PPIFIS/): Producer Price Index by Commodity: Final Demand ## Latest quarter (10-Q) Latest 10-Q source: https://www.sec.gov/Archives/edgar/data/1031308/000103130826000017/bsy-20260331.htm Extracted between Part I Item 2 and the next Item 3/4 or Part II heading after HTML sanitization. Confidence: high Filing date: 2026-05-07 Report date: 2026-03-31 Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion should be read in conjunction with our unaudited consolidated financial statements and notes thereto appearing in Part I, Item 1 of this Quarterly Report on Form 10‑Q and with our audited consolidated financial statements and notes thereto included in our 2025 Annual Report on Form 10‑K. All amounts presented in this Management’s Discussion and Analysis of Financial Condition and Results of Operations, except share and per share amounts, are presented in thousands. Additionally, many of the amounts and percentages have been rounded for convenience of presentation. Minor differences in totals and percentage calculations may exist due to rounding. Overview: Bentley Systems is the infrastructure engineering software company. Our purpose is to advance the world’s infrastructure for better quality of life. Our mission is to reshape how infrastructure systems and critical resources are delivered and optimized. We manage our business globally within one reportable segment, the development and marketing of computer software and related services, which is consistent with how our CODM reviews and manages our business. Executive Summary: •Total revenues were $424,181 for the three months ended March 31, 2026, up 14.5% or 11.9% on a constant currency basis(1) compared to the three months ended March 31, 2025; •Subscriptions revenues were $392,484 for the three months ended March 31, 2026, up 14.7% or 12.2% on a constant currency basis(1) compared to the three months ended March 31, 2025; •Annualized recurring revenues (“ARR”)(2) was $1,494,511 as of March 31, 2026, compared to $1,319,256 as of March 31, 2025; Constant currency(1) ARR growth rate(2) was 11.5%; •Last twelve-month recurring revenues dollar-based net retention rate(2) was 109% as of March 31, 2026, compared to 110% as of March 31, 2025; •Operating income was $126,260 for the three months ended March 31, 2026, compared to $115,184 for the three months ended March 31, 2025; •AOI less Operating SBC(1) was $140,923 for the three months ended March 31, 2026, compared to $128,308 for the three months ended March 31, 2025; and •Cash flows from operating activities were $193,408 for the three months ended March 31, 2026, compared to $219,415 for the three months ended March 31, 2025. (1)Constant currency and AOI less Operating SBC are non‑GAAP financial measures. Refer to the “Non‑GAAP Financial Measures” section for additional information, including our definitions and our uses of constant currency and AOI less Operating SBC. (2)Refer to the “Key Business Metrics” section for additional information, including our definitions and our uses of ARR, ARR growth rate, and recurring revenues dollar-based net retention rate. 29 Table of Contents Results of Operations: Our results of operations have been, and in the future will be, affected by changes in foreign currency exchange rates. Other than the natural hedge attributable to matching revenues and expenses in the same currencies, we do not currently hedge foreign currency exposure. We identify the effects of foreign currency on our operations and present constant currency growth rates and fluctuations because we believe exchange rates are an important factor in understanding period‑over‑period comparisons and enhance the understanding of our results and evaluation of our performance. Refer to the “Non‑GAAP Financial Measures” section for additional information, including our definition and our use of constant currency. Revenues Consolidated Revenues Change Three Months Ended Constant March 31, Currency 2026 2025 %    %(1) Subscriptions $ 392,484  $ 342,318  14.7 % 12.2 % Perpetual licenses 9,057  10,792  (16.1 %) (18.0 %) Subscriptions and licenses 401,541  353,110  13.7 % 11.3 % Services 22,640  17,432  29.9 % 25.8 % Total revenues $ 424,181  $ 370,542  14.5 % 11.9 % (1)Constant currency is a non-GAAP financial measure. Refer to the “Non-GAAP Financial Measures” section for additional information, including our definition and our use of constant currency, and for a reconciliation of constant currency growth rates. The increase in total revenues for the three months ended March 31, 2026 was primarily driven by an increase in subscriptions revenues, and to a lesser extent, an increase in services revenues, partially offset by a decrease in perpetual licenses revenues. Our business performance includes the impact from programmatic acquisitions, which generally are immaterial, individually and in the aggregate. Subscriptions. For the three months ended March 31, 2026, subscriptions revenues increased $50,166 ($41,734 on a constant currency basis) primarily driven by expansion from accounts with revenues in the same period in the prior year (“existing accounts”), and growth of 3% attributable to new accounts, most notably small- and medium-sized accounts. Increases in subscriptions revenues for the three months ended March 31, 2026 were led by Bentley Open Applications and Seequent applications, and to a lesser extent, Bentley Infrastructure Cloud. Perpetual licenses. For the three months ended March 31, 2026, perpetual licenses revenues decreased $1,735 ($1,946 on a constant currency basis). Services. For the three months ended March 31, 2026, services revenues increased $5,208 ($4,496 on a constant currency basis) primarily due to strength in Maximo-related work within our digital integrator. 30 Table of Contents Revenues by Geographic Region Revenue from external customers is attributed to individual countries based upon the location of the customer. Change Three Months Ended Constant March 31, Currency 2026 2025 %    %(1) Americas $ 225,634  $ 198,975  13.4 % 12.7 % EMEA 126,241  107,005  18.0 % 11.9 % APAC 72,306  64,562  12.0 % 9.6 % Total revenues $ 424,181  $ 370,542  14.5 % 11.9 % (1)Constant currency is a non-GAAP financial measure. Refer to the “Non-GAAP Financial Measures” section for additional information, including our definition and our use of constant currency, and for a reconciliation of constant currency growth rates. Americas. For the three months ended March 31, 2026, revenues from the Americas increased $26,659 ($25,323 on a constant currency basis) primarily due to expansion of our subscriptions revenues from existing accounts in the U.S., increases in our subscription revenues from new accounts, as well as an increase in services revenues. EMEA. For the three months ended March 31, 2026, revenues from EMEA increased $19,236 ($12,787 on a constant currency basis) primarily due to expansion of our subscriptions revenues from existing accounts, and to a lesser extent, increases in our subscriptions revenues from new accounts, and an increase in services revenues. APAC. For the three months ended March 31, 2026, revenues from APAC increased $7,744 ($6,174 on a constant currency basis) primarily due to expansion of our subscriptions revenues from existing accounts in India and Australia, as well as increases in our subscriptions revenues from new accounts, partially offset by a decline in perpetual licenses revenues. Cost of Revenues and Operating Expense (Income) Cost of Revenues Change Three Months Ended Constant March 31, Currency 2026 2025 %    %(1) Cost of subscriptions and licenses $ 53,098  $ 46,498  14.2 % 11.9 % Cost of services 20,676  19,161  7.9 % 3.1 % Total cost of revenues $ 73,774  $ 65,659  12.4 % 9.3 % (1)Constant currency is a non-GAAP financial measure. Refer to the “Non-GAAP Financial Measures” section for additional information, including our definition and our use of constant currency, and for a reconciliation of constant currency growth rates. Cost of subscriptions and licenses. For the three months ended March 31, 2026, on a constant currency basis, cost of subscriptions and licenses expenses increased primarily due to an increase in cloud-related costs of $5,683. Cost of services. For the three months ended March 31, 2026, on a constant currency basis, cost of services expenses increased primarily due to an increase in headcount‑related costs of $668, mainly due to an increase in third‑party personnel costs, partially offset by decreases in headcount, and annual and other compensation costs. 31 Table of Contents Operating Expense (Income) Change Three Months Ended Constant March 31, Currency 2026 2025 %    %(1) Research and development $ 83,005  $ 72,450  14.6 % 10.8 % Selling and marketing 75,272  63,059  19.4 % 15.0 % General and administrative 58,509  47,228  23.9 % 21.1 % Deferred compensation plan (1,074) (1,246) (13.8 %) (13.8 %) Amortization of purchased intangibles 8,435  8,208  2.8 % 2.0 % Total operating expenses $ 224,147  $ 189,699  18.2 % 14.5 % (1)Constant currency is a non-GAAP financial measure. Refer to the “Non-GAAP Financial Measures” section for additional information, including our definition and our use of constant currency, and for a reconciliation of constant currency growth rates. Research and development. For the three months ended March 31, 2026, on a constant currency basis, research and development expenses increased primarily due to an increase in headcount‑related costs of $6,436, mainly due to increases in headcount, and annual and other compensation costs, and to a lesser extent, higher acquisition‑related retention incentives. Selling and marketing. For the three months ended March 31, 2026, on a constant currency basis, selling and marketing expenses increased primarily due to an increase in headcount‑related costs of $6,184, mainly due to increases in annual and other compensation costs, and an increase in promotional costs of $2,428. General and administrative. For the three months ended March 31, 2026, on a constant currency basis, general and administrative expenses increased primarily due to an increase in headcount‑related costs of $7,135, mainly due to increases in headcount, and annual and other compensation costs, and an increase in third-party personnel costs. Additionally, during the three months ended March 31, 2026, general and administrative expenses further increased due to lower capitalizable costs associated with our internal-use software implementation as compared to the same period in the prior year. Starting in 2026, we expect general and administrative expenses to include amortization of internal-use software implementation costs, which represents amortization of deferred costs primarily related to the implementation of our new enterprise-wide administrative and business management platforms which are planned to complete going live in 2026. Deferred compensation plan. For the three months ended March 31, 2026 and 2025, deferred compensation plan income was attributable to the marked to market impact on deferred compensation plan liability balances period over period. Amortization of purchased intangibles. For the three months ended March 31, 2026, amortization of purchased intangibles was flat compared to the same period in the prior year. 32 Table of Contents Interest Expense, Net Three Months Ended March 31, 2026 2025 Change Interest expense $ (8,689) $ (4,408) 97.1 % Interest income 489  600  (18.5 %) Interest expense, net $ (8,200) $ (3,808) 115.3 % For the three months ended March 31, 2026, interest expense, net increased compared to the same period in the prior year, primarily due to higher weighted average debt outstanding and higher weighted average interest rates on borrowings following the January 2026 repayment of the 2026 Notes, which had a 0.125% coupon rate. Other Income, Net Three Months Ended March 31, 2026 2025 Gain (loss) from: Change in fair value of interest rate swap $ 76  $ (4,372) Fo [Excerpt truncated for page length; source filing is linked above.] ## Latest 10-K MD&A Extracted between Item 7 and the next Item 7A/8 heading after HTML sanitization. Confidence: high Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion should be read in conjunction with our audited consolidated financial statements and notes thereto included in Part II, Item 8 of this Annual Report on Form 10‑K. In addition to historical information, this discussion contains forward‑looking statements that involve risks, uncertainties, and assumptions that could cause actual results to differ materially from management’s expectations. Factors that could cause such differences are set forth in Part I, Item 1A. Risk Factors of this Annual Report on Form 10‑K. Refer to Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations in our 2024 Annual Report on Form 10‑K for management’s discussion and analysis of financial condition and results of operations for the year ended December 31, 2024 compared to the year ended December 31, 2023. All amounts presented in this Management’s Discussion and Analysis of Financial Condition and Results of Operations, except share and per share amounts, are presented in thousands. Additionally, many of the amounts and percentages have been rounded for convenience of presentation. Minor differences in totals and percentage calculations may exist due to rounding. Overview: Bentley Systems is the infrastructure engineering software company. Our purpose is to advance the world’s infrastructure for better quality of life. Our mission is to reshape how infrastructure systems and critical resources are delivered and optimized. We manage our business globally within one reportable segment, the development and marketing of computer software and related services, which is consistent with how our chief operating decision maker (“CODM”) reviews and manages our business. Executive Summary: •Total revenues were $1,501,779 for the year ended December 31, 2025, up 11.0% or 10.1% on a constant currency basis(1) compared to the prior year; •Subscriptions revenues were $1,376,696 for the year ended December 31, 2025, up 12.5% or 11.7% on a constant currency basis(1) compared to the prior year; •ARR(2) was $1,462,145 as of December 31, 2025, compared to $1,283,256 as of December 31, 2024; Constant currency(1) ARR growth rate(2) was 11.5%; •Last twelve-month recurring revenues dollar-based net retention rate(2) was 109% as of December 31, 2025, compared to 110% as of December 31, 2024; •Operating income was $362,621 for the year ended December 31, 2025, compared to $302,150 for the prior year; •Adjusted operating income less stock-based compensation expense (“AOI less SBC”) (previously titled Adjusted operating income inclusive of stock-based compensation expense (“Adjusted OI w/SBC”))(1) was $429,917 for the year ended December 31, 2025, compared to $372,222 for the prior year; and •Cash flows from operating activities were $538,464 for the year ended December 31, 2025, compared to $435,292 for the prior year. (1)Constant currency and AOI less SBC are non‑GAAP financial measures. Refer to the “Non‑GAAP Financial Measures” section for additional information, including our definitions and our uses of constant currency and AOI less SBC. (2)Refer to the “Key Business Metrics” section for additional information, including our definitions and our uses of ARR, ARR growth rate, and recurring revenues dollar-based net retention rate. 34 Table of Contents Results of Operations: Our results of operations have been, and in the future will be, affected by changes in foreign currency exchange rates. For the years ended December 31, 2025, 2024, and 2023, approximately 33%, 34%, and 35%, respectively, of our total revenues and 45%, 42%, and 45%, respectively, of our total operating expenses were denominated in a currency other than the U.S. dollar including most significantly: euros, British pounds, Canadian dollars, Australian dollars, Chinese yuan renminbi, and New Zealand dollars. Other than the natural hedge attributable to matching revenues and expenses in the same currencies, we do not currently hedge foreign currency exposure. Additionally, because we have operations in, and derive revenue from, geographies around the world, we will continue to monitor the impact of tariffs and other trade policies on our business and the businesses of our accounts, as well as on our financial condition, results of operations, and/or cash flows. We identify the effects of foreign currency on our operations and present constant currency growth rates and fluctuations because we believe exchange rates are an important factor in understanding period‑over‑period comparisons and enhance the understanding of our results and evaluation of our performance. Refer to the “Non‑GAAP Financial Measures” section for additional information, including our definition and our use of constant currency. Revenues We generate revenues from subscriptions, perpetual licenses, and services. Our total revenues are diversified by account type, size, and geographic region. The majority of our revenue growth, excluding the impact from acquisitions, is driven by additional subscriptions revenues from existing accounts using the same products. To a lesser extent, our revenue growth is attributable to subscriptions revenues from new accounts and subscriptions revenues from existing accounts using new products. We believe that we have a loyal account base, with over 70% of our total revenues for the years ended December 31, 2025, 2024, and 2023 generated from organizations that have been our accounts for over ten years. In addition to our results of operations discussed below, the following is supplemental data of our revenues: Year Ended December 31, (as a percentage of total revenues) 2025 2024 2023 Revenues from: Direct sales channels 94 % 93 % 92 % Indirect channel partners 6 % 7 % 8 % Revenues from: Subscriptions 92 % 90 % 88 % Recurring services 1 % 1 % 1 % Total recurring revenues 93 % 91 % 89 % Perpetual licenses and other services 7 % 9 % 11 % Largest account represents no more than 2 % 2 % 2 % The volume, mix, and duration of contract types starting or renewing in any given period may have a material impact on revenue in the period, and as a result can impact the comparability of reported revenue period-over-period. Our subscriptions, perpetual licenses, and services offerings are recognized pursuant to applicable GAAP guidance. See Note 3 to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10‑K for additional information on our revenues. We believe that subscription revenues will continue to comprise a majority of our total revenues. 35 Table of Contents Consolidated Revenues % Change % Change 2024 to 2025 2023 to 2024 Constant Constant Year Ended December 31, Currency Currency 2025 2024 2023 %    %(1) %    %(1) Subscriptions $ 1,376,696  $ 1,223,362  $ 1,080,307  12.5 % 11.7 % 13.2 % 13.4 % Perpetual licenses 46,180  45,961  46,038  0.5 % 0.1 % (0.2 %) 0.5 % Subscriptions and licenses 1,422,876  1,269,323  1,126,345  12.1 % 11.2 % 12.7 % 12.9 % Services 78,903  83,772  102,068  (5.8 %) (6.6 %) (17.9 %) (18.2 %) Total revenues $ 1,501,779  $ 1,353,095  $ 1,228,413  11.0 % 10.1 % 10.1 % 10.3 % (1)Constant currency is a non‑GAAP financial measure. Refer to the “Non‑GAAP Financial Measures” section for additional information, including our definition and our use of constant currency, and for a reconciliation of constant currency growth rates. The increase in total revenues for the year ended December 31, 2025 was primarily driven by an increase in subscriptions revenues, partially offset by a decrease in services revenues. Subscriptions. For the year ended December 31, 2025, the increase in subscriptions revenues was driven by improvements in our business performance of $153,334 ($142,592 on a constant currency basis). Our business performance includes the impact from programmatic acquisitions, which generally are immaterial, individually and in the aggregate. For the year ended December 31, 2025, the improvements in business performance were primarily driven by expansion from accounts with revenues in the prior period (“existing accounts”), and growth of 2.5% attributable to new accounts, most notably small- and medium-sized accounts. Improvements in business performance for the year ended December 31, 2025 were led by Bentley Open Applications, followed by Seequent applications, and Bentley Infrastructure Cloud. Perpetual licenses. For the year ended December 31, 2025, perpetual licenses revenues were flat compared to the prior year. Services. For the year ended December 31, 2025, the decrease in services revenues was driven by a decline in our business performance of $4,869 ($5,548 on a constant currency basis), primarily due to the winding down of a large services project in the beginning of 2025. Revenues by Geographic Region Revenue from external customers is attributed to individual countries based upon the location of the customer. % Change % Change 2024 to 2025 2023 to 2024 Constant Constant Year Ended December 31, Currency Currency 2025 2024 2023 %    %(1) %    %(1) Americas $ 790,495  $ 717,002  $ 650,926  10.3 % 10.4 % 10.2 % 10.5 % EMEA 436,828  388,384  353,550  12.5 % 9.2 % 9.9 % 9.1 % APAC 274,456  247,709  223,937  10.8 % 10.7 % 10.6 % 11.8 % Total revenues $ 1,501,779  $ 1,353,095  $ 1,228,413  11.0 % 10.1 % 10.1 % 10.3 % (1)Constant currency is a non-GAAP financial measure. Refer to the “Non-GAAP Financial Measures” section for additional information, including our definition and our use of constant currency, and for a reconciliation of constant currency growth rates. 36 Table of Contents Americas. For the year ended December 31, 2025, the increase in revenues from the Americas was primarily driven by improvements in our business performance of $73,493 ($74,816 on a constant currency basis). The improvements in business performance for the year ended December 31, 2025 were primarily due to expansion of our subscriptions revenues from existing accounts in the U.S., as well as increases in our subscriptions revenues from new accounts. EMEA. For the year ended December 31, 2025, the increase in revenues from EMEA was primarily driven by improvements in our business performance of $48,444 ($35,754 on a constant currency basis). The improvements in business performance for the year ended December 31, 2025 were primarily due to expansion of our subscriptions revenues from existing accounts in the United Kingdom (“U.K.”) and the Middle East, as well as increases in our subscriptions revenues from new accounts, partially offset by a decline in services revenues. APAC. For the year ended December 31, 2025, the increase in revenues from APAC was primarily driven by improvements in our business performance of $26,747 ($26,524 on a constant currency basis). The improvements in business performance for the year ended December 31, 2025 were primarily due to expansion of our subscriptions revenues from existing accounts in Australia and India, as well as increases in our subscriptions revenues from new accounts. Additionally, for the year ended December 31, 2025, our revenues in China were essentially flat. Our perpetual licenses revenues in China increased primarily due to expansion from new accounts, partially offset by a decline from existing accounts. Our subscriptions revenues in China decreased primarily due to a decline from existing accounts, partially offset by an increase from new accounts. The future results in China remain uncertain as a result of continued geopolitical challenges, the obstacles there to cloud‑deployed software, and the financial timing impact of the preference there for license sales, rather than subscriptions. Cost of Revenues and Operating Expenses Headcount-Related Costs For the years ended December 31, 2025, 2024, and 2023, approximately 80% of our aggregate cost of revenues, research and development, selling and marketing, and general and administrative expenses were represented by what we refer to herein as “headcount‑related” costs. These costs primarily include salaries, benefits, bonuses, stock‑based compensation expense, employment taxes, travel, training, and realignment and optimization of our colleagues, and third‑party personnel expenses and related overhead. Our headcount‑related costs are variable in nature. We actively manage these costs to align to our trending run rate of revenue performance, with the objective of enhancing visibility and predictability of resulting operating profit margins. During the fourth quarter of 2023, we approved a strategic realignment program to better serve our accounts and to better align resources with the strategy of the business, including reinvestment in go-to-market functions, as well as in AI in product development (the “2023 Program”). The realignment program resulted in realignment costs of $847 and $12,579 for the years ended December 31, 2024 and 2023, respectively, which represent termination benefits for colleagues whose roles were impacted (less than five percent of total headcount). See Note 21 to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10‑K for additional information. The 2023 Program activities, including payments of termination benefits, were completed as of December 31, 2024. 37 Table of Contents Cost of Revenues % Change % Change 2024 to 2025 2023 to 2024 Constant Constant Year Ended December 31, Currency Currency 2025 2024 2023 %    %(1) %    %(1) Cost of subscriptions and licenses $ 201,405  $ 173,340  $ 169,406  16.2 % 15.9 % 2.3 % 2.4 % Cost of services 76,125  84,427  96,677  (9.8 %) (10.8 %) (12.7 %) (12.8 %) Total cost of revenues $ 277,530  $ 257,767  $ 266,083  7.7 % 7.1 % (3.1 %) (3.1 %) (1)Constant currency is a non-GAAP financial measure. Refer to the “Non-GAAP Financial Measures” section for additional information, including our definition and our use of constant currency, and for a reconciliation of constant currency growth rates. Cost of subscriptions and licenses. Cost of subscriptions and licenses expenses primarily include headcount‑related costs, as well as cloud‑related costs incurred for servicing our accounts using cloud provisioned offerings and our license administration platform. Cost of subscriptions and licenses expenses also include channel partner compensation for providing sales coverage to users, depreciation of property and equipment, amortization of capitalized software costs associated with servicing software subscriptions and our Accelerated Commercial Development Program (“ACDP”), and amortization of intangible assets associated with acquired software and technology. For the year ended December 31, 2025, on a constant currency basis, cost of subscriptions and licenses expenses increased primarily due to an increase in headcount‑related costs of $15,149, mainly due to an increase in annual and other compensation costs, and an increase in cloud-related costs of $10,007. Cost of services. Cost of services expenses primarily include headcount‑related costs, as well as depreciation of property and equipment, and amortization of capitalized software costs used for providing training, implementation, configuration, and customization services to accounts. For the year ended December 31, 2025, on a constant currency basis, cost of services expenses decreased primarily due to a decrease in headcount‑related costs of $6,718, mainly due to a reduction in third‑party personnel costs, and to a lesser extent, lower annual and other compensation costs. Operating Expenses % Change % Change 2024 to 2025 2023 to 2024 Constant Constant Year Ended December 31, Currency Currency 2025 2024 2023 %    %(1) %    %(1) Research and development $ 307,576  $ 281,247  $ 274,619  9.4 % 9.1 % 2.4 % 2.7 % Selling and marketing 289,543  255,177  224,336  13.5 % 12.8 % 13.7 % 14.1 % General and administrative 217,332  210,374  180,738  3.3 % 2.9 % 16.4 % 16.5 % Deferred compensation plan 14,409  12,382  13,580  16.4 % 16.4 % (8.8 %) (8.8 %) Amortization of purchased intangibles 32,768  33,998  38,515  (3.6 %) (3.8 %) (11.7 %) (11.8 %) Total operating expenses $ 861,628  $ 793,178  $ 731,788  8.6 % 8.2 % 8.4 % 8.6 % (1)Constant currency is a non-GAAP financial measure. Refer to the “Non-GAAP Financial Measures” section for additional information, including our definition and our use of constant currency, and for a reconciliation of constant currency growth rates. 38 Table of Contents Research and development. Research and development expenses primarily consist of headcount‑related costs, including costs to develop software products or the software component of products to be sold, leased, or marketed to external accounts, before technological feasibility is reached, which is generally shortly before the release of such products. Our research and development roadmap balances technology advances and new offerings with continuous enhancements to existing offerings. Our allocation of research and development resources is based on a cost‑benefit analysis of acquiring available technology in the marketplace versus developing our own software. We anticipate that we will continue to make substantial investments in research and development because we believe the infrastructure engineering software market presents compelling opportunities for the application of new technologies that advance our current offerings. For the year ended December 31, 2025, on a constant currency basis, research and development expenses increased primarily due to an increase in headcount‑related costs of $25,665, mainly due to increases in headcount, and annual and other compensation costs, and to a lesser extent, higher colleague separation costs. Headcount‑related costs for the year ended December 31, 2024 were lower due to run‑rate savings as a result of the 2023 Program. Selling and marketing. Selling and marketing expenses primarily include headcount‑related costs, as well as the expense of online marketing, product marketing and other brand‑building activities, such as advertising, trade shows, and expositions, and various sales and promotional programs. We anticipate that we will continue to make strategic investments in our global business systems and methods to enhance major account sales activities and to support our worldwide sales and marketing strategies, and the business in general. For the year ended December 31, 2025, on a constant currency basis, selling and marketing expenses increased primarily due to an increase in headcount‑related costs of $24,174, mainly due to increases in headcount, and annual and other compensation costs, and an increase in promotional costs of $6,216. Headcount‑related costs for the year ended December 31, 2024 were lower due to run‑rate savings as a result of the 2023 Program. General and administrative. General and administrative expenses primarily include headcount‑related costs for our finance, human resources, and legal functions, as well as professional fees for legal and accounting services. General and administrative expenses also include acquisition costs, which consist of costs related to legal, accounting, valuation, insurance, and other consulting and transaction fees. Acquisition costs may drive fluctuations in general and administrative expenses depending on the timing of business combinations. Starting in 2026, we expect general and administrative expenses to include amortization of internal-use software implementation costs, which represents amortization of deferred costs primarily related to the implementation of our new enterprise-wide administrative and business management platforms which are planned to complete going live in 2026. For the year ended December 31, 2025, on a constant currency basis, general and administrative expenses increased primarily due to an increase in headcount‑related costs of $4,412, mainly due to increases in headcount, and annual and other compensation costs, partially offset by lower incentive compensation expense related to the reduction in Gregory S. Bentley’s fractional interest under the amended and restated Bentley Systems, Incorporated Bonus Pool Plan (the “Bonus Plan”) as part of Mr. Bentley’s transition to the role of Executive Chair effective July 1, 2024. Additionally, during the year ended December 31, 2024, we recognized approximately $2,200 of other corporate initiatives expenses, which did not recur in the current year. Deferred compensation plan. Deferred compensation plan reflects the expense (income) recorded related to changes in deferred compensation plan liabilities, which are marked to market at the end of each reporting period. For the year ended December 31, 2025, deferred compensation plan expense was attributable to the marked to market impact on deferred compensation plan liability balances period over period. Amortization of purchased intangibles. Amortization of purchased intangibles includes the amortization of acquired non‑product related intangible assets, primarily customer relationships, trademarks, and non‑compete agreements recorded in connection with completed acquisitions. 39 Table of Contents For the year ended December 31, 2025, on a constant currency basis, amortization of purchased intangibles decreased primarily due to previously acquired intangible assets that continue to become fully amortized and lower acquisition activity as compared to prior years. Interest Expense, Net % Change Year Ended December 31, 2024 2023 2025 2024 2023 to 2025 to 2024 Interest expense $ (15,322) $ (24,774) $ (41,331) (38.2 %) (40.1 %) Interest income 2,887  2,730  1,538  5.8 % 77.5 % Interest expense, net $ (12,435) $ (22,044) $ (39,793) (43.6 %) (44.6 %) Interest expense, net primarily represents interest expense on our credit facility borrowings and outstanding convertible senior notes, amortization of deferred debt issuance costs, and interest income from our investments in money market funds. The majority of our debt is protected from rising interest rates, through either very low fixed coupon interest on our convertible notes or our $200,000 interest rate swap, which expires in 2030. For the year ended December 31, 2025, interest expense, net decreased primarily due to lower weighted average debt outstanding under the credit facilities as compared to the prior year. Other Income (Expense), Net Year Ended December 31, 2025 2024 2023 (Loss) gain from: Change in fair value of interest rate swap $ (10,238) $ 10  $ (5,038) Foreign exchange (1) 2,578  939  2,497  Receipts related to interest rate swap 7,390  9,309  8,803  Other income (expense), net (2) 817  2,691  (13,484) Total other income (expense), net $ 547  $ 12,949  $ (7,222) (1)Foreign exchange gain is primarily attributable to foreign currency translation derived mainly from U.S. dollar denominated cash and cash equivalents, account receivables, customer deposits, and intercompany balances held by foreign subsidiaries. (2)Other income (expense), net for the year ended December 31, 2023 includes non-marketable equity investment impairment and other charges of $(16,988), partially offset by gains on non-marketable equity investments of $2,360. Provision (Benefit) for Income Taxes Year Ended December 31, 2025 2024 2023 Income before income taxes $ 350,733  $ 293,055  $ 183,527  Provision (benefit) for income taxes $ 72,977  $ 58,726  $ (143,241) Effective tax rate 20.8 % 20.0 % (78.0 %) Provision (benefit) for income taxes includes the aggregate consolidated income tax expense for U.S. domestic and foreign income taxes. For the year ended December 31, 2025, the effective tax rate was higher as compared to the year ended December 31, 2024 primarily due to the decrease in tax benefits related to stock‑based compensation, net of the impact from officer compensation limitation provisions, recognized in the current year. 40 Table of Contents On July 4, 2025, President Trump signed into law the One Big Beautiful Bill Act (“OBBBA”). The OBBBA includes the permanent extension of certain expiring provisions of the U.S. Tax Cuts and Jobs Act (the “JOBS Act”), modifications to the international tax framework, and the restoration of favorable tax treatment for certain business provisions. The legislation has multiple effective dates. The OBBBA had a favorable impact on our cash paid for income taxes in 2025, with continued cash tax favorability expected in 2026, primarily attributable to the change in restoring immediate U.S. tax deductions for domestic research and development expenses. The OBBBA did not have a material impact on the effective tax rate for the year ended December 31, 2025. Key Business Metrics: In addition to our results of operations discussed above, we believe the following presentation of key business metrics provides additional useful information to investors regarding our results of operations. To the extent material, we disclose below the additional purposes, if any, for which our management uses these key business metrics. Our key business metrics may vary significantly from period to period for reasons unrelated to our operating performance and may differ from similarly titled measures presented by other companies. December 31, 2025 2024 2023 ARR $ 1,462,145  $ 1,283,256  $ 1,174,774  Last twelve-months recurring revenues $ 1,391,350  $ 1,238,004  $ 1,096,677  Twelve-months ended constant currency (1): ARR growth rate 11.5 % 12 % 12.5 % Account retention rate 99 % 99 % 98 % Recurring revenues dollar-based net retention rate 109 % 110 % 109 % (1)Constant currency is a non-GAAP financial measure. Refer to the “Non-GAAP Financial Measures” section for additional information, including our definition and our use of constant currency. Recurring Revenues Recurring revenues are the basis for our other revenue-related key business metrics. We believe this measure is useful in evaluating our ability to consistently retain and grow our revenues within our existing accounts. Recurring revenues are subscriptions revenues that recur monthly, quarterly, or annually with specific or automatic renewal clauses and professional services revenues in which the underlying contract is based on a fixed fee and contains automatic annual renewal provisions. ARR ARR is a key business metric that we believe is useful in evaluating the scale and growth of our business as well as to assist in the evaluation of underlying trends in our business. Furthermore, we believe ARR, considered in connection with our last twelve‑month recurring revenues dollar‑based net retention rate, is a leading indicator of revenue growth. ARR is defined as the sum of the annualized value of our portfolio of contracts that produce recurring revenues as of the last day of the reporting period, and the annualized value of the last three months of recognized revenues for our contractually recurring consumption‑based software subscriptions with consumption measurement durations of less than one year, calculated using the spot foreign currency exchange rates. We believe that the last three months of recognized revenues, on an annualized basis, for our recurring software subscriptions with consumption measurement period durations of less than one year is a reasonable estimate of the annual revenues, given our consistently high retention rate and stability of usage under such subscriptions. 41 Table of Contents ARR resulting from the annualization of recurring contracts with consumption measurement durations of less than one year, as a percentage of total ARR, was 51%, 50%, and 47% as of December 31, 2025, 2024, and 2023, respectively, with our E365 subscription offering representing 46%, 45%, and 41% of total ARR as of December 31, 2025, 2024, and 2023, respectively. Constant currency ARR growth rate is the growth rate of ARR measured on a constant currency basis. In reporting period-over-period ARR growth rates in constant currency, we calculate constant currency growth rates by translating current and prior period ARR on a transactional basis to our reporting currency using current year budget exchange rates. We believe that ARR growth is an important metric indicating the scale and growth of our business. Last Twelve‑Months Recurring Revenues Last twelve‑month recurring revenues is a key business metric that we believe is useful in evaluating our ability to consistently retain and grow our recurring revenues. We believe that we will continue to experience favorable growth in recurring revenues primarily due to our strong account retention and recurring revenues dollar‑based net retention rates, as well as the addition of new accounts with recurring revenues. Last twelve‑months recurring revenues is calculated as recurring revenues recognized over the preceding twelve‑month period. The last twelve‑months recurring revenues for the periods ended December 31, 2025, 2024, and 2023 compared to the last twelve‑months of the comparative twelve‑month period increased by $153,346, $141,327, and $118,653, respectively. This increase was primarily due to growth in ARR, which is primarily the result of growing our recurring revenues within our existing accounts as expressed in our recurring revenues dollar‑based net retention rate, as well as additional recurring revenues resulting from new accounts and acquisitions. For the twelve months ended December 31, 2025, 2024, and 2023, 93%, 91%, and 89%, respectively, of our revenues were recurring revenues. Account Retention Rate Account retention rate is a key business metric that we believe is useful in evaluating the long‑term value of our account relationships and our ability to retain our account base. We believe that our consistent and high account retention rates illustrate our ability to retain and cultivate long‑term relationships with our accounts. Account retention rate for any given twelve-month period is calculated using the average foreign currency exchange rates for the prior period, as follows: the prior period recurring revenues from all accounts with recurring revenues in the current and prior period, divided by total recurring revenues from all accounts during the prior period. Recurring Revenues Dollar‑Based Net Retention Rate Recurring revenues dollar‑based net retention rate is a key business metric that we believe is useful in evaluating our ability to consistently retain and grow our recurring revenues. Recurring revenues dollar‑based net retention rate is calculated, using the average exchange rates for the prior period, as follows: the recurring revenues for the current period, including any growth or reductions from existing accounts, but excluding recurring revenues from any new accounts added during the current period, divided by the total recurring revenues from all accounts during the prior period. A period is defined as any trailing twelve months. Related to our platform acquisitions, recurring revenues into new accounts will be captured as existing accounts starting with the second anniversary of the acquisition when such data conforms to the calculation methodology. This may cause variability in the comparison. Given that recurring revenues represented 93%, 91%, and 89% of our total revenues for the twelve months ended December 31, 2025, 2024, and 2023, respectively, this metric helps explain our revenue performance as primarily growth from existing accounts. 42 Table of Contents Non-GAAP Financial Measures: In addition to our results determined in accordance with GAAP discussed above, we believe the following presentation of financial measures not in accordance with GAAP provides useful information to investors regarding our results of operations. To the extent material, we disclose below the additional purposes, if any, for which our management uses these non‑GAAP financial measures and provide reconciliations between these non‑GAAP financial measures and their most directly comparable GAAP financial measures. Non‑GAAP financial information should be considered in addition to, not as a substitute for, or in isolation from, the financial information prepared in accordance with GAAP, including operating income, or other measures of performance. Our non‑GAAP financial measures may vary significantly from period to period for reasons unrelated to our operating performance and may differ from similarly titled measures presented by other companies. Adjusted Operating Income Less Stock-Based Compensation Expense (“AOI less SBC”) AOI less SBC is a non-GAAP financial measure and is used to measure the operational strength and performance of our business, as well as to assist in the evaluation of underlying trends in our business. AOI less SBC is defined as operating income adjusted for the following: amortization of purchased intangibles, expense (income) relating to deferred compensation plan liabilities, acquisition expenses (inclusive of cash‑settled retention incentives provided to key employees of acquired companies), and realignment expenses (income), for the respective periods. AOI less SBC is our primary performance measure, which excludes certain expenses and charges, including the non-cash amortization expense resulting from the acquisition of intangible assets, as we believe these may not be indicative of our core business operating results. We intentionally include stock-based compensation expense in this measure as we believe it better captures the economic costs of our business. Management uses this non-GAAP financial measure to understand and compare operating results across accounting periods, for internal budgeting and forecasting purposes, to evaluate financial performance, and in our comparison of our financial results to those of other companies. It is also a significant performance measure in certain of our executive incentive compensation programs. Adjusted Operating Income (“AOI”) Adjusted operating income is a non-GAAP financial measure that we believe is useful to investors in making comparisons to other companies, although this measure may not be directly comparable to similar measures used by other companies. Adjusted operating income is defined as operating income adjusted for the following: amortization of purchased intangibles, expense (income) relating to deferred compensation plan liabilities, acquisition expenses (inclusive of cash‑settled retention incentives provided to key employees of acquired companies), realignment expenses (income), and stock‑based compensation expense, for the respective periods. 43 Table of Contents Reconciliation of operating income to AOI less SBC and to Adjusted operating income: Year Ended December 31, 2025 2024 2023 Operating income $ 362,621  $ 302,150  $ 230,542  Amortization of purchased intangibles (1) 45,658  46,679  51,219  Deferred compensation plan (2) 14,409  12,382  13,580  Acquisition expenses (3) 7,229  10,222  17,866  Realignment expenses (4) —  789  11,470  AOI less SBC 429,917  372,222  324,677  Stock-based compensation expense (5) 71,949  73,505  71,470  Adjusted operating income $ 501,866  $ 445,727  $ 396,147  Further explanation of certain of our adjustments in arriving at AOI less SBC and Adjusted operating income are as follows: (1)Amortization of purchased intangibles. Amortization of purchased intangibles varies in amount and frequency and is significantly impacted by the timing and size of our acquisitions. Management finds it useful to exclude these non‑cash charges from our operating expenses to assist in budgeting, planning, and forecasting future periods. The use of intangible assets contributed to our revenues earned during the periods presented and will also contribute to our revenues in future periods. Amortization of purchased intangible assets will recur in future periods. (2)Deferred compensation plan. We exclude Deferred compensation plan expense (income) when we evaluate our continuing operational performance because it is not reflective of our ongoing business and results of operations. We believe it is useful for investors to understand the effects of this item on our total operating expenses. Deferred compensation plan liabilities are marked to market at the end of each reporting period, with changes in the liabilities recorded as an expense (income) to Deferred compensation plan in the consolidated statements of operations. (3)Acquisition expenses. We incur expenses for professional services rendered in connection with business combinations, which are included in our GAAP presentation of general and administrative expense. Also included in our acquisition expenses are cash‑settled retention incentives provided to key employees of the acquired companies. We exclude these acquisition expenses when we evaluate our continuing operational performance as we would not have otherwise incurred these expenses in the periods presented as part of our continuing operations. (4)Realignment expenses. We exclude these charges and subsequent adjustments to our estimates when we evaluate our continuing operational performance because they are not reflective of our ongoing business and results of operations. We believe it is useful for investors to understand the effects of these items on our total operating expenses. During the fourth quarter of 2023, we approved the 2023 Program. For the years ended December 31, 2024 and 2023, we recognized realignment costs related to the aforementioned program of $847 and $12,579, respectively, which represent termination benefits for colleagues whose roles were impacted (see Note 21 to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10‑K). For the year ended December 31, 2023, realignment expenses were partially offset by income associated with the continued wind down of our Russian entities following our decision to exit the Russian market beginning in the second quarter of 2022. (5)Stock‑based compensation expense. We exclude non-cash stock‑based compensation expenses from certain of our non‑GAAP measures because we believe this is useful to investors in making comparisons to other companies. Constant Currency Constant currency and constant currency growth rates are non-GAAP financial measures that present our results of operations excluding the estimated effects of foreign currency exchange rate fluctuations. A significant amount of our operations is conducted in foreign currencies. As a result, the comparability of the financial results reported in U.S. dollars is affected by changes in foreign currency exchange rates. We use constant currency and constant currency growth rates to evaluate the underlying performance of the business, and we believe it is helpful for investors to present operating results on a comparable basis period over period to evaluate its underlying performance. 44 Table of Contents In reporting period‑over‑period results, except for ARR as discussed above in “Key Business Metrics” section, we calculate the effects of foreign currency fluctuations and constant currency information by translating current and prior period results on a transactional basis to our reporting currency using prior period average foreign currency exchange rates in which the transactions occurred. Reconciliation of consolidated revenues to consolidated revenues in constant currency: Constant Currency Change 2024 to 2025: Year Ended December 31, 2025 Year Ended December 31, 2024 Actual Impact of Foreign Exchange at 2024 Rates Constant Currency Actual Impact of Foreign Exchange at 2024 Rates Constant Currency Subscriptions $ 1,376,696  $ (11,533) $ 1,365,163  $ 1,223,362  $ (791) $ 1,222,571  Perpetual licenses 46,180  (174) 46,006  45,961  (5) 45,956  Subscriptions and licenses 1,422,876  (11,707) 1,411,169  1,269,323  (796) 1,268,527  Services 78,903  (680) 78,223  83,772  (1) 83,771  Total revenues $ 1,501,779  $ (12,387) $ 1,489,392  $ 1,353,095  $ (797) $ 1,352,298  Constant Currency Change 2023 to 2024: Year Ended December 31, 2024 Year Ended December 31, 2023 Actual Impact of Foreign Exchange at 2023 Rates Constant Currency Actual Impact of Foreign Exchange at 2023 Rates Constant Currency Subscriptions $ 1,223,362  $ 814  $ 1,224,176  $ 1,080,307  $ (977) $ 1,079,330  Perpetual licenses 45,961  323  46,284  46,038  (4) 46,034  Subscriptions and licenses 1,269,323  1,137  1,270,460  1,126,345  (981) 1,125,364  Services 83,772  (291) 83,481  102,068  (61) 102,007  Total revenues $ 1,353,095  $ 846  $ 1,353,941  $ 1,228,413  $ (1,042) $ 1,227,371  Reconciliation of revenues by geographic region to revenues by geographic region in constant currency: Constant Currency Change 2024 to 2025: Year Ended December 31, 2025 Year Ended December 31, 2024 Actual Impact of Foreign Exchange at 2024 Rates Constant Currency Actual Impact of Foreign Exchange at 2024 Rates Constant Currency Americas $ 790,495  $ 1,141  $ 791,636  $ 717,002  $ (182) $ 716,820  EMEA 436,828  (13,073) 423,755  388,384  (383) 388,001  APAC 274,456  (455) 274,001  247,709  (232) 247,477  Total revenues $ 1,501,779  $ (12,387) $ 1,489,392  $ 1,353,095  $ (797) $ 1,352,298  45 Table of Contents Constant Currency Change 2023 to 2024: Year Ended December 31, 2024 Year Ended December 31, 2023 Actual Impact of Foreign Exchange at 2023 Rates Constant Currency Actual Impact of Foreign Exchange at 2023 Rates Constant Currency Americas $ 717,002  $ 1,751  $ 718,753  $ 650,926  $ (238) $ 650,688  EMEA 388,384  (2,754) 385,630  353,550  (118) 353,432  APAC 247,709  1,849  249,558  223,937  (686) 223,251  Total revenues $ 1,353,095  $ 846  $ 1,353,941  $ 1,228,413  $ (1,042) $ 1,227,371  Reconciliation of cost of revenues to cost of revenues in constant currency: Constant Currency Change 2024 to 2025: Year Ended December 31, 2025 Year Ended December 31, 2024 Actual Impact of Foreign Exchange at 2024 Rates Constant Currency Actual Impact of Foreign Exchange at 2024 Rates Constant Currency Cost of subscriptions and licenses $ 201,405  $ (658) $ 200,747  $ 173,340  $ (83) $ 173,257  Cost of services 76,125  (729) 75,396  84,427  121  84,548  Total cost of revenues $ 277,530  $ (1,387) $ 276,143  $ 257,767  $ 38  $ 257,805  Constant Currency Change 2023 to 2024: Year Ended December 31, 2024 Year Ended December 31, 2023 Actual Impact of Foreign Exchange at 2023 Rates Constant Currency Actual Impact of Foreign Exchange at 2023 Rates Constant Currency Cost of subscriptions and licenses $ 173,340  $ 140  $ 173,480  $ 169,406  $ 22  $ 169,428  Cost of services 84,427  (101) 84,326  96,677  6  96,683  Total cost of revenues $ 257,767  $ 39  $ 257,806  $ 266,083  $ 28  $ 266,111  Reconciliation of operating expenses to operating expenses in constant currency: Constant Currency Change 2024 to 2025: Year Ended December 31, 2025 Year Ended December 31, 2024 Actual Impact of Foreign Exchange at 2024 Rates Constant Currency Actual Impact of Foreign Exchange at 2024 Rates Constant Currency Research and development $ 307,576  $ (626) $ 306,950  $ 281,247  $ 25  $ 281,272  Selling and marketing 289,543  (1,662) 287,881  255,177  (39) 255,138  General and administrative 217,332  (949) 216,383  210,374  (43) 210,331  Deferred compensation plan 14,409  —  14,409  12,382  —  12,382  Amortization of purchased intangibles 32,768  (58) 32,710  33,998  —  33,998  Total operating expenses $ 861,628  $ (3,295) $ 858,333  $ 793,178  $ (57) $ 793,121  46 Table of Contents Constant Currency Change 2023 to 2024: Year Ended December 31, 2024 Year Ended December 31, 2023 Actual Impact of Foreign Exchange at 2023 Rates Constant Currency Actual Impact of Foreign Exchange at 2023 Rates Constant Currency Research and development $ 281,247  $ 817  $ 282,064  $ 274,619  $ 17  $ 274,636  Selling and marketing 255,177  505  255,682  224,336  (212) 224,124  General and administrative 210,374  (106) 210,268  180,738  (308) 180,430  Deferred compensation plan 12,382  —  12,382  13,580  —  13,580  Amortization of purchased intangibles 33,998  (39) 33,959  38,515  (2) 38,513  Total operating expenses $ 793,178  $ 1,177  $ 794,355  $ 731,788  $ (505) $ 731,283  Liquidity and Capital Resources: Cash and Cash Equivalents December 31, 2025 2024 Cash and cash equivalents held domestically $ 39,093  $ 2,845  Cash and cash equivalents held by foreign subsidiaries 84,185  61,164  Total cash and cash equivalents $ 123,278  $ 64,009  Our primary source of operating cash is from the sale of our subscriptions, perpetual licenses, and services. Our primary use of cash is payment of our operating costs, which consist mainly of headcount‑related costs. In addition to operating expenses, we also use cash to service our debt obligations, to pay quarterly dividends, to repurchase our Class B common stock and convertible debt, and for capital expenditures in support of our operations. We also use cash to fund our acquisitions of software assets and businesses, and other investment activities. During the years ended December 31, 2025 and 2024, we made cash repatriations to the U.S. of approximately $180,000 and $138,000, respectively, from earnings generated by our foreign subsidiaries. In 2025 and 2024, the repatriations were primarily used to pay down our credit facility borrowings and to supplement our domestic working capital needs. We believe that cash generated from operations, together with existing cash and cash equivalent balances, and external borrowings including available liquidity under the Credit Facility, will be sufficient to meet our domestic and international working capital and capital expenditure requirements. We regularly review our capital structure and consider a variety of potential financing alternatives and planning strategies to ensure that we have the proper liquidity available in the locations in which it is needed and to fund our operations and growth investments with cash that has not been permanently reinvested outside the U.S. Our future capital requirements may be materially different than those currently planned in our budgeting and forecasting activities and depend on many factors, including our strategy of regularly acquiring and integrating specialized infrastructure engineering software businesses, our rate of revenue growth, the timing and extent of spending on research and development, the expansion of our sales and marketing activities, the timing of new product introductions, market acceptance of our products, competitive factors, our discretionary payments of dividends or repurchases of our Class B common stock and convertible debt, funding of our purchase commitments, currency fluctuations, and overall economic conditions, globally. To the extent that current and anticipated future sources of liquidity are insufficient to fund our future business activities and requirements, we may be required to seek additional equity or debt financing. The sale of additional equity would result in additional dilution to our stockholders, while the incurrence of additional debt financing, including convertible debt, would result in additional debt service obligations. Such debt instruments also could introduce new or modified covenants that might restrict our operations and/or our ability to pay dividends, 47 Table of Contents consummate acquisitions, or otherwise pursue our business strategies. We cannot provide assurance that we could obtain additional financing on favorable terms or at all. Cash Flows Activity Year Ended December 31, 2025 2024 2023 Net cash provided by (used in): Operating activities $ 538,464  $ 435,292  $ 416,696  Investing activities $ (112,309) $ (143,267) $ (60,504) Financing activities $ (376,298) $ (289,850) $ (359,074) Operating Activities For the year ended December 31, 2025, compared to the prior year, net cash provided by operating activities was higher by $103,172 due to an increase in net income of $43,361, an increase in net cash flows from the change in operating assets and liabilities of $36,777, and a net increase in non‑cash adjustments of $23,034. The increase in net cash flows from the change in operating assets and liabilities year over year was primarily due to higher deferred revenues, timing of collections on our receivables, higher accounts payable, lower capitalized internal-use software implementation costs, as well as the overall timing of payments for software maintenance contracts. Offsetting these increases were lower period over period Cloud Services Subscription deposits and lower accruals and other current liabilities. Investing Activities Net cash used in investing activities was lower by $30,958 for the year ended December 31, 2025, compared to the prior year, primarily due to lower acquisition related payments of $37,155. We used available cash and borrowings under our credit facilities to fund our acquisitions. Financing Activities Net cash used in financing activities was higher by $86,448 for the year ended December 31, 2025, compared to the prior year, primarily due to higher payments for shares acquired of $80,381, including shares repurchased under the BSY Stock Repurchase Program (the “Repurchase Program”) and higher dividend payments of $12,848, primarily due to an increase in our quarterly dividend per share to $0.07 in 2025 from $0.06 in 2024, partially offset by lower net paydowns of the credit facilities of $11,398. Additionally, we paid $9,797 in cash to repurchase $10,000 aggregate principal amount of our outstanding 2026 Notes during the first quarter of 2025. Long-Term Debt December 31, 2025 2024 Current portion of long-term debt $ —  $ —  Long-term debt 1,248,912  1,388,088  Total debt $ 1,248,912  $ 1,388,088  On October 18, 2024, we entered into the Credit Facility, which provides us with a $1,300,000 revolving credit facility, including a $125,000 swingline loan and $125,000 in letters of credit. The Credit Facility also provides us with a $500,000 “accordion” feature to increase the facility in the form of both revolving indebtedness and/or incremental term loans. On October 18, 2024, we used borrowings under the Credit Facility to repay all indebtedness outstanding under the 2017 Credit Facility, including the outstanding senior secured term loan. 48 Table of Contents As of December 31, 2025, we had $1,299,850 available under the Credit Facility, and we were in compliance with all covenants under the Credit Facility, the 2026 Notes, and the 2027 Notes. Any failure to comply with such covenants under the Credit Facility would prevent us from being able to borrow additional funds under the Credit Facility, and, as with any failure to comply with such covenants under the 2026 Notes and the 2027 Notes, could constitute a default that may cause all amounts outstanding to become due and immediately payable in full. As of December 31, 2025, the 2026 Notes were classified as long‑term in the consolidated balance sheets as we had the ability and intent to refinance them on a long‑term basis through available capacity under the Credit Facility. The 2026 Notes matured on January 15, 2026. Upon maturity, we repaid $678,254, which consisted of the remaining outstanding principal balance and accrued interest on the 2026 Notes using borrowings under the Credit Facility and available cash on hand. Our credit facilities, 2026 Notes, and 2027 Notes are described in Note 10 to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10‑K. Stock Repurchases BSY Stock Repurchase Program Our Board of Directors had authorized us to repurchase up to $200,000 of our Class B common stock and/or outstanding convertible senior notes through June 30, 2024 under the Repurchase Program. This authorization under the Repurchase Program expired on June 30, 2024. In March 2024, our Board of Directors approved an extension to the Repurchase Program authorizing us to repurchase up to $200,000 of our Class B common stock and/or outstanding convertible senior notes from June 30, 2024 through June 30, 2026. In November 2025, our Board of Directors approved an extension to the Repurchase Program authorizing us to repurchase up to $500,000 of our Class B common stock and/or outstanding convertible senior notes from November 21, 2025 through December 31, 2028. This updated authorization supersedes our prior authorization, which was set to expire on June 30, 2026. We may use available working capital, cash provided by operating activities, and/or external borrowings including available liquidity under our Credit Facility to make repurchases. During the year ended December 31, 2025, we repurchased 2,887,224 shares for $125,057, and $10,000 aggregate principal amount of our outstanding 2026 Notes for $9,797 under the Repurchase Program. During the year ended December 31, 2024, we repurchased 1,292,733 shares for $64,359 under the Repurchase Program. The timing, as well as the number and value of shares and/or outstanding convertible senior notes repurchased under the Repurchase Program, will be determined at our discretion and will depend on a variety of factors, including our assessment of the intrinsic value of our shares, the market price of our Class B common stock and outstanding convertible senior notes, general market and economic conditions, available liquidity, compliance with our debt and other agreements, and applicable legal requirements. Withholding Taxes on Certain Equity Awards We have the right to require that certain equity awardees receive gross or net quantities of shares of our Class B common stock, including distributions from the DCP and share issuances under the Bonus Plan. In the case of a gross issuance or distribution, an awardee is required to reimburse promptly to us the cash required for his or her tax withholding amounts. Conversely, under a net issuance or distribution, shares are withheld in consideration of remitting withholding taxes on behalf of an equity awardee, thereby requiring us to remit cash for the tax withholdings. We exercised our right to require that impacted equity awardees receive gross quantities of our Class B common stock during the first quarter of 2025, but we allowed impacted awardees the option to receive net quantities of shares of our Class B common stock during the second, third, and fourth quarters of 2025. During the year ended December 31, 2024, we exercised our right to require that impacted equity awardees receive gross quantities of our Class B common stock. We will continue to evaluate whether share awards will be required to be received by awardees on a gross basis, or if net settlement may be elected by awardees. 49 Table of Contents Dividend Payments The declaration and payment of dividends is within the discretion of our Board of Directors. We paid quarterly dividends of $0.07 per share of common stock during the year ended December 31, 2025 and $0.06 per share of common stock during the year ended December 31, 2024. While we intend to continue paying quarterly dividends, any future determination will be subject to the discretion of our Board of Directors and will be dependent on a number of factors, including our results of operations, capital requirements, restrictions under Delaware law, and overall financial condition, as well as any other factors our Board of Directors considers relevant. In addition, the terms of the agreement governing the Credit Facility limit the amount of dividends we can pay. Contractual Obligations and Other Commitments: The following table summarizes our most significant contractual obligations as of December 31, 2025: Total Due within 12 months Due after 12 months Debt Obligations (1) $ 1,252,830  $ 677,830  $ 575,000  Purchase Obligations $ 53,700  $ 17,600  $ 36,100  DCP Obligations $ 111,125  $ 4,294  $ 106,831  (1)Amounts represent the face value of debt and exclude interest payments. Our largest contractual obligations relate to our outstanding debt, which include convertible notes due in 2026 and 2027. We repaid the 2026 Notes upon maturity on January 15, 2026. Our Credit Facility matures on October 18, 2029, subject to a “revolving maturity date” on the date that is 91 days prior to the maturity date of our outstanding convertible debt, unless on such date we meet certain liquidity requirements. We typically fund and expect to continue to fund debt maturities and interest payments with cash flows generated from operations, existing cash and cash equivalents, or proceeds from additional financing. If an early conversion notice is received, we have the option to pay cash, deliver shares of our Class B common stock, or a combination thereof. See Note 10 to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10‑K for additional information on our debt obligations. We have non‑cancelable future cash purchase commitments for services related to cloud provisioning of our software and for internal‑use software costs. Our purchase obligations are in addition to amounts included in our consolidated balance sheets. We have funded and expect to continue to be able to fund our purchase obligations with cash flows generated from operations, existing cash and cash equivalents or revolving loan borrowings under the Credit Facility. See Note 18 to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10‑K for additional information on our purchase obligations. Our DCP obligations represent DCP participants’ holdings in phantom investment funds, which are classified as liabilities as they will be settled in cash upon eventual distribution. We have funded and expect to continue to be able to fund our DCP obligations with cash flows generated from operations, existing cash and cash equivalents, or revolving loan borrowings under the Credit Facility. See Note 12 to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10‑K for additional information on our DCP obligations. Our other future contractual obligations are related to leases. See Note 8 to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10‑K for additional information on our lease obligations. 50 Table of Contents Critical Accounting Estimates: The preparation of our consolidated financial statements in conformity with GAAP requires us to make estimates that affect the reported amounts of assets, liabilities, revenues, and expenses, and the related disclosure of contingent assets and contingent liabilities. We base our judgments on our historical experience and on various other assumptions that we believe are reasonable under the circumstances, the results of which form the basis for making estimates about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. Revenue Recognition Our contracts with customers may include promises to transfer licenses (perpetual or term‑based), maintenance, and services to a user. Judgment is required to determine if the promises are separate performance obligations, and if so, the allocation of the transaction price to each performance obligation. When an arrangement includes multiple performance obligations which are concurrently delivered and have the same pattern of transfer to the customer, we account for those performance obligations as a single performance obligation. For contracts with more than one performance obligation, the transaction price is allocated among the performance obligations in an amount that depicts the relative standalone selling price (“SSP”) of each obligation. Judgment is required to determine the SSP for each distinct performance obligation. In instances where SSP is not directly observable, such as when we do not sell the product or service separately, we determine the SSP using information that may include market conditions and other observable inputs. We use a range of amounts to estimate SSP when we sell each of the products and services separately and need to determine whether there is a discount that should be allocated based on the relative SSP of the various products and services. Our SELECT agreement provides users with perpetual licenses a right to exchange software for other eligible perpetual licenses on an annual basis upon renewal. We refer to this option as portfolio balancing and concluded that the portfolio balancing feature represents a material right resulting in the deferral of the associated revenue. Judgment is required to estimate the percentage of users who may elect to portfolio balance and considers inputs such as historical user elections. This feature is available once per term and must be exercised prior to the respective renewal term. We recognize the associated revenue upon election or when the portfolio balancing right expires. This right is included in the initial and subsequent renewal terms and we reestablish the revenue deferral for the material right upon the beginning of the renewal term. Portfolio balancing exchange rights are included in Deferred revenues in the consolidated balance sheets. Goodwill and Other Intangible Assets Intangible assets primarily arise from acquisitions and principally consist of goodwill, acquired software and technology, customer relationships, and trademarks. Finite-lived intangible assets are amortized on a straight‑line basis over their estimated useful lives. Goodwill Goodwill consists of the excess of cost over the fair value of net assets acquired in business combinations. Goodwill is not amortized but instead is tested annually for impairment on October 1, or more frequently if events occur or circumstances change that would more likely than not reduce its fair value below its carrying amount. We allocate goodwill to reporting units on a relative fair value basis. 51 Table of Contents In testing for goodwill impairment, we may first qualitatively assess whether it is more likely than not (a likelihood of more than 50 percent) that a goodwill impairment exists. If it is determined that a quantitative assessment is required and the carrying amount exceeds its fair value, we will recognize goodwill impairment in the amount in which the carrying amount of the reporting unit exceeds its fair value, but not to exceed the carrying amount of goodwill within the reporting unit. The process of evaluating the potential impairment of goodwill is subjective and requires significant judgment at many points in the process. The value of our goodwill could also be impacted by future adverse changes including declines in our stock price, market capitalization, or cash flows, and slower growth rates in our industry. There was no impairment of goodwill as a result of our annual impairment assessments conducted for the years ended December 31, 2025, 2024, or 2023. Other Intangible Assets We evaluate intangible assets subject to amortization for impairment whenever events or changes in circumstances indicate that the carrying value of these assets may not be recoverable or that useful lives of those assets are no longer appropriate. If circumstances require an asset to be tested for possible impairment, we first compare the undiscounted cash flows expected to be generated by that asset to its carrying value. If the carrying value of the asset is not recoverable on an undiscounted cash flow basis, an impairment is recognized to the extent that the carrying value exceeds its fair value. The process of evaluating the potential impairment of intangible assets is subjective and requires significant judgment at many points in the process. There was no impairment of intangible assets subject to amortization for the years ended December 31, 2025, 2024, or 2023. Income Taxes We account for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the consolidated financial statements. Under this method, deferred tax assets and liabilities are determined based on net operating loss (“NOL”) carryforwards, credit carryforwards, and temporary differences between the financial statement and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the items are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period of the enactment date. We perform a quarterly assessment of the recoverability of the net deferred tax assets. We consider all available evidence, both positive and negative, in determining whether all or a portion of a deferred tax asset is more likely than not to be realized. In the event we determine that all or a portion of the deferred tax assets is not more likely than not to be realized, an adjustment to the valuation allowance would be recorded that would increase the provision for income taxes. To the extent that the realization of a deferred tax asset is based upon forecasted future earnings, our judgment regarding future profitability may change due to future market conditions and other factors. Assumptions about future taxable income require significant judgment and, while these assumptions rely heavily on estimates, such estimates are consistent with the plans we are using to manage the underlying business. Any change in future profitability may require material adjustments to these net deferred tax assets, resulting in a reduction in net income in the period when such determination is made. Additionally, future changes in tax laws and rates, including administrative or regulatory guidance, could affect recorded deferred tax assets and liabilities. Any adjustments to these estimates will generally be recorded as an income tax expense or benefit in the period the adjustment is determined. 52 Table of Contents We are subject to income taxes in the U.S. and in numerous foreign jurisdictions. The calculation of our tax liabilities often involves dealing with uncertainties in the application of complex tax laws and regulations in a multitude of jurisdictions across our global operations. There are many transactions and calculations about which the ultimate tax outcome is uncertain. A benefit from an uncertain tax position may be recognized when it is more likely than not that the position will be sustained based upon the technical merits of the position. This may include expected resolutions upon examination, any related appeals, or through a litigation processes. As a result, our calculations involve estimates by management. Due to the complexity of some of these uncertainties, the ultimate resolution may result in a payment, potentially including interest and penalties, that is materially different from our current estimates of the unrecognized tax benefit liabilities. These differences, along with any related interest and penalties, will generally be reflected as increases or decreases to income tax expense in the period in which new information becomes available. We review the tax reserves as circumstances warrant and adjust the reserves as events occur that affect our potential liability for additional taxes. We follow the applicable guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition with respect to uncertain tax positions. We recognize interest and penalties related to income taxes within the (Provision) benefit for income taxes line in the consolidated statements of operations. Accrued interest and penalties are included within the related tax liability line in the consolidated balance sheets.