KALTURA INC (KLTR)
SIC breadcrumb: Services > Business Services > SIC 7372 Services-Prepackaged Software
SEC company page: https://www.sec.gov/edgar/browse/?CIK=1432133. Latest filing source: 0001628280-26-018182.
Selected Fundamentals
| Metric | Value | Unit | FY | Filed |
|---|---|---|---|---|
| Revenue | 180,854,000 | USD | 2025 | 2026-03-16 |
| Net income | -12,072,000 | USD | 2025 | 2026-03-16 |
| Assets | 164,697,000 | USD | 2025 | 2026-03-16 |
Financials
Annual standardized facts from SEC companyfacts as of latest extracted filing date 2026-03-16. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001432133.json. Derived margins, ratios, and free cash flow are computed from the extracted annual SEC facts.
| Metric | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|
| Revenue | 97,349,000 | 120,440,000 | 165,016,000 | 168,811,000 | 175,172,000 | 178,717,000 | 180,854,000 | |
| Net income | -15,572,000 | -58,763,000 | -59,351,000 | -68,495,000 | -46,366,000 | -31,315,000 | -12,072,000 | |
| Operating income | -2,779,000 | -8,489,000 | -32,675,000 | -56,379,000 | -38,655,000 | -24,099,000 | -4,963,000 | |
| Gross profit | 61,731,000 | 72,775,000 | 102,702,000 | 106,940,000 | 112,234,000 | 119,106,000 | 127,669,000 | |
| Diluted EPS | -0.34 | -0.21 | -0.08 | |||||
| Operating cash flow | 370,000 | 5,804,000 | -22,110,000 | -46,828,000 | -8,303,000 | 12,233,000 | 14,541,000 | |
| Capital expenditures | 2,239,000 | 1,118,000 | 1,876,000 | 1,218,000 | 2,607,000 | 521,000 | 661,000 | |
| Share buybacks | 0.00 | 0.00 | 2,920,000 | 26,205,000 | ||||
| Assets | 90,954,000 | 223,293,000 | 206,171,000 | 183,736,000 | 181,305,000 | 164,697,000 | ||
| Liabilities | 191,498,000 | 138,019,000 | 162,825,000 | 153,416,000 | 156,918,000 | 158,365,000 | ||
| Stockholders' equity | -196,035,000 | -210,281,000 | -260,656,000 | 85,274,000 | 43,346,000 | 30,320,000 | 24,387,000 | 6,332,000 |
| Cash and cash equivalents | 26,538,000 | 27,711,000 | 143,949,000 | 44,625,000 | 36,684,000 | 33,059,000 | 27,521,000 | |
| Free cash flow | -1,869,000 | 4,686,000 | -23,986,000 | -48,046,000 | -10,910,000 | 11,712,000 | 13,880,000 |
Ratios
| Metric | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|
| Net margin | -16.00% | -48.79% | -35.97% | -40.57% | -26.47% | -17.52% | -6.67% | |
| Operating margin | -2.85% | -7.05% | -19.80% | -33.40% | -22.07% | -13.48% | -2.74% | |
| Return on equity | -69.60% | -158.02% | -152.92% | -128.41% | -190.65% | |||
| Return on assets | -64.61% | -26.58% | -33.22% | -25.24% | -17.27% | -7.33% | ||
| Liabilities / equity | 1.62 | 3.76 | 5.06 | 6.43 | 25.01 | |||
| Current ratio | 0.64 | 1.79 | 1.22 | 1.12 | 1.20 | 0.72 |
Financial Charts
Quarterly
Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-05-11. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001432133.json.
| Quarter | End Date | Revenue | Net Income | Diluted EPS | Method |
|---|---|---|---|---|---|
| 2021-Q2 | 2021-06-30 | 0.37 | reported discrete quarter | ||
| 2022-Q1 | 2022-03-31 | -0.13 | reported discrete quarter | ||
| 2022-Q2 | 2022-06-30 | -0.13 | reported discrete quarter | ||
| 2022-Q3 | 2022-09-30 | 0.15 | reported discrete quarter | ||
| 2023-Q1 | 2023-03-31 | 43,273,000 | -12,795,000 | reported discrete quarter | |
| 2023-Q2 | 2023-06-30 | 43,880,000 | -10,778,000 | -0.08 | reported discrete quarter |
| 2023-Q3 | 2023-09-30 | 43,542,000 | -10,726,000 | 0.08 | reported discrete quarter |
| 2024-Q1 | 2024-03-31 | 44,781,000 | -11,096,000 | reported discrete quarter | |
| 2024-Q2 | 2024-06-30 | 44,032,000 | -10,004,000 | -0.07 | reported discrete quarter |
| 2024-Q3 | 2024-09-30 | 44,295,000 | -3,610,000 | -0.02 | reported discrete quarter |
| 2024-Q4 | 2024-12-31 | 45,609,000 | -6,605,000 | derived Q4 = FY annual - nine-month YTD | |
| 2025-Q1 | 2025-03-31 | 46,984,000 | -1,119,000 | reported discrete quarter | |
| 2025-Q2 | 2025-06-30 | 44,462,000 | -7,750,000 | -0.05 | reported discrete quarter |
| 2025-Q3 | 2025-09-30 | 43,866,000 | -2,628,000 | 0.02 | reported discrete quarter |
| 2025-Q4 | 2025-12-31 | 45,542,000 | -575,000 | derived Q4 = FY annual - nine-month YTD | |
| 2026-Q1 | 2026-03-31 | 44,626,000 | -3,769,000 | -0.03 | reported discrete quarter |
Quarterly Charts
Macro Cross-References
- CPIAUCSL - Consumer Price Index for All Urban Consumers: All Items in U.S. City Average
- UNRATE - Unemployment Rate
- FEDFUNDS - Federal Funds Effective Rate
- CES0500000003 - Average Hourly Earnings of All Employees, Total Private
- DFEDTARU - Federal Funds Target Range - Upper Limit
- DFEDTARL - Federal Funds Target Range - Lower Limit
- DGS3MO - Market Yield on U.S. Treasury Securities at 3-Month Constant Maturity
- DGS2 - Market Yield on U.S. Treasury Securities at 2-Year Constant Maturity
- DGS10 - Market Yield on U.S. Treasury Securities at 10-Year Constant Maturity
- DGS30 - Market Yield on U.S. Treasury Securities at 30-Year Constant Maturity
- T10Y2Y - 10-Year Treasury Constant Maturity Minus 2-Year Treasury Constant Maturity
- CPILFESL - Consumer Price Index for All Urban Consumers: All Items Less Food and Energy
- CPIUFDSL - Consumer Price Index for All Urban Consumers: Food
- CPIENGSL - Consumer Price Index for All Urban Consumers: Energy
- CUSR0000SAH1 - Consumer Price Index for All Urban Consumers: Shelter
- PCEPI - Personal Consumption Expenditures: Chain-type Price Index
- PCEPILFE - Personal Consumption Expenditures Excluding Food and Energy: Chain-type Price Index
- PPIACO - Producer Price Index by Commodity: All Commodities
- T10YIE - 10-Year Breakeven Inflation Rate
- U6RATE - Total Unemployed, Plus All Marginally Attached Workers Plus Total Employed Part Time for Economic Reasons
- PAYEMS - All Employees, Total Nonfarm
- CIVPART - Labor Force Participation Rate
- EMRATIO - Employment-Population Ratio
- UNEMPLOY - Unemployed
- CE16OV - Employment Level
- ICSA - Initial Claims
- JTSJOL - Job Openings: Total Nonfarm
- JTSQUR - Quits: Total Nonfarm
- GDPC1 - Real Gross Domestic Product
- A191RL1Q225SBEA - Real Gross Domestic Product: Percent Change from Preceding Period
- INDPRO - Industrial Production: Total Index
- TCU - Capacity Utilization: Total Index
- HOUST - New Privately-Owned Housing Units Started: Total Units
- PERMIT - New Privately-Owned Housing Units Authorized in Permit-Issuing Places: Total Units
- RSAFS - Advance Retail Sales: Retail Trade
- PCE - Personal Consumption Expenditures
- DSPIC96 - Real Disposable Personal Income
- PSAVERT - Personal Saving Rate
- M2SL - M2
- BOPGSTB - U.S. International Trade in Goods and Services: Balance
- MSPUS - Median Sales Price of Houses Sold for the United States
- HSN1F - New One Family Houses Sold: United States
- RHORUSQ156N - Homeownership Rate in the United States
- TTLCONS - Total Construction Spending: Total Construction in the United States
- RRVRUSQ156N - Rental Vacancy Rate in the United States
- TOTALSL - Total Consumer Credit Owned and Securitized
- REVOLSL - Revolving Consumer Credit Owned and Securitized
- DRCCLACBS - Delinquency Rate on Credit Card Loans, All Commercial Banks
- GDP - Gross Domestic Product
- GPDI - Gross Private Domestic Investment
- GCE - Government Consumption Expenditures and Gross Investment
- PCEC - Personal Consumption Expenditures
- NETEXP - Net Exports of Goods and Services
- GFDEBTN - Federal Debt: Total Public Debt
- GFDEGDQ188S - Federal Debt: Total Public Debt as Percent of Gross Domestic Product
- FYFSD - Federal Surplus or Deficit
- FGRECPT - Federal Government Current Receipts
- FGEXPND - Federal Government: Current Expenditures
- MANEMP - All Employees, Manufacturing
- USCONS - All Employees, Construction
- USTRADE - All Employees, Retail Trade
- USFIRE - All Employees, Financial Activities
- USGOVT - All Employees, Government
- AWHAETP - Average Weekly Hours of All Employees, Total Private
- DGORDER - Manufacturers' New Orders: Durable Goods
- NEWORDER - Manufacturers' New Orders: Nondefense Capital Goods Excluding Aircraft
- BUSINV - Total Business Inventories
- EXPGS - Exports of Goods and Services
- IMPGS - Imports of Goods and Services
- IR - Import Price Index (End Use): All Commodities
- PPIFIS - Producer Price Index by Commodity: Final Demand
Latest quarter (10-Q)
Latest 10-Q source: 0001628280-26-033466.
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations. The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our condensed consolidated financial statements and related notes appearing elsewhere in this Quarterly Report on Form 10-Q and our Annual Report on Form 10-K for the year ended December 31, 2025, filed with the SEC on March 16, 2026 (the "2025 10-K"). This discussion contains forward-looking statements based upon current plans, expectations and beliefs involving risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth in Part I, Item 1A, “Risk Factors” of our 2025 10-K and elsewhere in this Quarterly Report on Form 10-Q. Overview We, Kaltura, Inc. (“Kaltura,” “we,” “us,” or “our”), are a market-leading provider of video and rich media offerings for enterprises. Our mission is to power rich, agentic digital experiences across organizational journeys for customers, employees, learners, and audiences. Kaltura's Digital Experience Platform enables organizations to create, manage, and deliver video and rich media experiences that increasingly incorporate agentic artificial intelligence (“AI”) capabilities, including conversational interfaces, workflow automation, and outcome-oriented engagement across digital touchpoints. We believe this combination of video, rich media and agentic capabilities enables organizations to move beyond static, one-size-fits-all digital experiences toward more personalized, contextual, and interactive agentic digital experiences at scale. Video and other forms of rich media - including interactive, data-driven, and conversational media - are central to digital interaction and engagement, transforming how people communicate, work, learn, and consume content. For organizations, rich media increasingly sits at the core of digital transformation initiatives, with businesses adopting media-driven solutions to engage customers, employees, learners, and audiences across a growing range of use cases. At the same time, advances in generative artificial intelligence (“Gen AI”) are enabling the real-time and automated creation of highly personalized and contextually relevant content, including video and other forms of rich media. We believe the convergence of rich media and AI is increasing the scale, speed, and strategic importance of digital experiences and driving demand for platforms that support more interactive, contextual, and outcome-oriented engagement. Founded in 2006, Kaltura was among the pioneers to recognize the potential of integrating video into enterprise workflows and to offer a system for enterprise video content management and online video publishing. Over time, we expanded our platform to support additional experiences, including virtual events and webinars and cloud-based television services. Today, Kaltura provides a cloud-based rich media platform designed to help organizations create, manage, and deliver rich media experiences at scale across customer-facing, employee-facing, learner-facing, and audience-facing use cases. Our Digital Experience platform is designed around three core layers: rich media content creation, rich media content management, and rich media experiences. Together, these layers enable organizations to produce and generate live and on-demand video and other forms of rich media, securely manage content, users, permissions, and metadata across enterprise and media environments, and deliver media-rich experiences across a wide range of internal and external workflows. The platform increasingly incorporates agentic AI-driven capabilities designed to enable more interactive, contextual, and goal-oriented experiences, while maintaining enterprise-grade security, privacy, and governance. As video usage continues to accelerate across communication, work, and learning environments, organizations are increasingly deploying sophisticated video solutions to further engage with their customers, partners, and employees. The introduction of Gen AI further amplifies this demand and is expected to have a substantial impact on our business by enabling the automatic production of hyper-personalized and contextually relevant video experiences in real time. We believe this powerful new tool will expand opportunities for increased video creation, consumption, and monetization, and drives a need for advanced video content management solutions. 32 Table of Contents To support our AI capabilities, in 2025, we acquired eSelf AI, a multimodal AI lab developing technology for agentic interactions with live avatars. Through this acquisition, we expanded our content creation and experience capabilities to include AI-generated video and avatar-based interactions, enhancing our rich media content creation layer. In addition, in April, 2026, we completed our previously announced acquisition of PathFactory Holdings ULC (“PathFactory”), a provider of content journey orchestration and engagement analytics solutions. We believe this acquisition, will strengthen our position in the emerging conversation automation and agentic engagement solutions market and complement the eSelf AI acquisition by adding journey-level orchestration, intent data, analytics, and integrations across additional content types and enterprise systems. We generate revenue primarily from the sale of Software-as-a-Service (“SaaS”) subscriptions, and we also derive revenue from platform usage license subscriptions and associated professional services. Our sales typically target medium to large enterprises, educational institutions, technology providers, and media and telecom companies. In addition, we are expanding our go-to-market approaches to support a wider range of adoption models and customer sizes. Our professional services revenue is generally driven by implementation and support services for new and existing customers. We organize our business into two reporting segments: (i) Enterprise, Education, and Technology (“EE&T”); and (ii) Media and Telecom (“M&T”). Accordingly, our financial reporting distinguishes between revenue and gross profit from Subscription and Professional Services from customers who use our products and services to address Entertainment & Monetization use cases (for their audiences), reported in our M&T segment, and those that are attained from customers who are using us to address all other use cases (for their customers, employees, and learners), reported in our EE&T segment. These segments share a common underlying platform consisting of our API-based architecture, as well as unified product development, operations, and administrative resources. •Enterprise, Education & Technology: In the EE&T segment, subscription revenue is primarily generated on a per full‑time equivalent or platform usage‑license basis for all of our products, in addition to revenue derived from associated professional services. This segment encompasses customers utilizing Kaltura’s solutions to deliver agentic rich-media experiences for their customers, employees, and learners such as buyer enablement, employee recruiting, learning and teaching. Contracts in this segment typically range from 12 to 24 months, with billing generally executed on an annual basis. •Media & Telecom: The M&T segment includes revenue from customers using Kaltura to deliver entertainment and streaming use cases to their audiences, along with the associated professional services. For customers of our telecom TVCMS and TV Streaming Applications, revenue is recognized primarily on a per end‑subscriber basis, while media customers leveraging our Online Video Platform are billed on a platform usage‑license basis. Contracts in this segment generally extend for two to five years, with billing performed on either a quarterly or annual basis. Implementation of TV offerings typically requires six to 12 months, with upfront resource requirements generally higher than those for our other offerings. Consequently, there is an extended period from initial booking to go‑live, accompanied by a higher proportion of professional services revenue relative to overall revenue. Additionally, a greater share of revenue in this segment is derived from customers licensing our offerings through private cloud and on‑premise deployments, which has an impact on our gross margin. 33 Table of Contents Reflected below is a summary of reportable segment revenue and reportable segment gross profit for the three months ended March 31, 2026 and 2025. Three Months Ended March 31, 2026 2025 (in thousands) Revenue Enterprise, Education & Technology $ 34,151 $ 34,416 Media & Telecom 10,475 12,568 Total Revenue $ 44,626 $ 46,984 Gross Profit Enterprise, Education & Technology 26,462 26,568 Media & Telecom 5,646 6,168 Total Gross Profit $ 32,108 $ 32,736 We employ a "land and expand strategy" with the aim of having our customers increase their usage of our offerings and/or purchase additional offerings over time. For the three months ended March 31, 2026 and 2025, our Net Dollar Retention Rate was 95% and 107%, respectively, primarily reflecting the lagging impact of elevated churn in our M&T segment in 2025 . Our Annualized Recurring Revenue (as defined below), declined by 3% in the three months ended March 31, 2026, compared to the three months ended March 31, 2025. For any given year, a large majority of our revenue comes from existing customers, with whom we are in active dialogue and tend to have visibility into their expected usage of our offerings. We are expanding our go-to-market approaches to support a wider range of adoption models and customer sizes. We believe certain of our newer offerings, particularly AI-assisted content creation tools and conversational rich media agents, are well suited for more targeted departmental deployments, self-service adoption, and product-led growth (“PLG”) motions. These offerings may enable us to engage smaller organizations, teams, and departments, including small and medium enterprises (“SMEs”) and individual groups within larger enterprises, while remaining complementary to our core enterprise business. In addition, we are investing in developer-led growth (“DLG”) initiatives by expanding our APIs, SDKs, and developer tools, including planned offerings such as an Agentic Avatar SDK. These capabilities are designed to enable independent software vendors (“ISVs”), system integrators, partners, and developers to embed Kaltura-powered rich media and conversational interfaces into their own products, workflows, and applications. We also intend to continue expanding our ecosystem of channel partners, including co-sell, resell, OEM, and marketplace relationships. We believe that broader partner distribution, including through cloud marketplaces and digital channels, may increase reach, reduce customer acquisition costs, and accelerate adoption across both enterprise and self-service use cases. Recent partnerships with platforms such as Descript and Cornerstone illustrate this strategy: by integrating the Company’s AI-powered video, avatar, content management, and engagement capabilities into adjacent creation, learning, and workforce-development workflows, the Company intends to meet customers where they already work, package its capabilities into higher-value solutions, and unlock partner-led demand from established enterprise ecosystems. Key Factors Affecting Our Performance Expansion of our Platform We believe our platform is ideally suited for expansion across solutions, industries, and use cases. For example, in 2020, we entered the real-time conferencing market with the introduction of our Virtual and Hybrid Events, Webinars, and Online Learning products, focusing on learning, training, even [Excerpt truncated for page length; source filing is linked above.]
Latest 10-K MD&A
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and related notes appearing elsewhere in this Annual Report on Form 10-K. This discussion contains forward-looking statements based upon current plans, expectations and beliefs involving risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth in Part I, Item 1A, “Risk Factors” and other factors set forth in other parts of this Annual Report on Form 10-K.
This section of our Annual Report on Form 10-K discusses our financial condition and results of operations for the fiscal years ended December 31, 2025 and 2024, and year-to-year comparisons between fiscal 2025 and fiscal 2024. A discussion of our financial condition and results of operations for the fiscal year ended December 31, 2023 and year-to-year comparisons between fiscal 2024 and fiscal 2023 can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, filed on February 20, 2025
Overview
We, Kaltura, Inc. (“Kaltura,” “we,” “us,” or “our”), are a market-leading provider of video and rich media offerings for enterprises. Our mission is to power rich, agentic digital experiences across organizational journeys for customers, employees, learners, and audiences.
Kaltura's Digital Experience Platform enables organizations to create, manage, and deliver video and rich media experiences that increasingly incorporate agentic artificial intelligence (“AI”) capabilities, including conversational interfaces, workflow automation, and outcome-oriented engagement across digital touchpoints. We believe this combination of video, rich media and agentic capabilities enables organizations to move beyond static, one-size-fits-all digital experiences toward more personalized, contextual, and interactive agentic digital experiences at scale.
Video and other forms of rich media - including interactive, data-driven, and conversational media - are central to digital interaction and engagement, transforming how people communicate, work, learn, and consume content. For organizations, rich media increasingly sits at the core of digital transformation initiatives, with businesses adopting media-driven solutions to engage customers, employees, learners, and audiences across a growing range of use cases. At the same time, advances in generative artificial intelligence (“Gen AI”) are enabling the real-time and automated creation of highly personalized and contextually relevant content, including video and other forms of rich media. We believe the convergence of rich media and AI is increasing the scale, speed, and strategic importance of digital experiences and driving demand for platforms that support more interactive, contextual, and outcome-oriented engagement.
Founded in 2006, Kaltura was among the pioneers to recognize the potential of integrating video into enterprise workflows and to offer a system for enterprise video content management and online video publishing. Over time, we expanded our platform to support additional experiences, including virtual events and webinars and cloud-based television services. Today, Kaltura provides a cloud-based rich media platform designed to help organizations create, manage, and deliver rich media experiences at scale across customer-facing, employee-facing, learner-facing, and audience-facing use cases.
Our Digital Experience platform is designed around three core layers: rich media content creation, rich media content management, and rich media experiences. Together, these layers enable organizations to produce and generate live and on-demand video and other forms of rich media, securely manage content, users, permissions, and metadata across enterprise and media environments, and deliver media-rich experiences across a wide range of internal and external workflows. The platform increasingly incorporates agentic AI-driven capabilities designed to enable more interactive, contextual, and goal-oriented experiences, while maintaining enterprise-grade security, privacy, and governance.
As video usage continues to accelerate across communication, work, and learning environments, organizations are increasingly deploying sophisticated video solutions to further engage with their customers, partners, and employees. The introduction of generative AI (“Gen AI”) further amplifies this demand and is expected to have a substantial impact on our business by enabling the automatic production of hyper-personalized and contextually relevant video experiences in real time. We believe this powerful new tool will expand opportunities for increased video creation, consumption, and monetization, and drives a need for advanced video content management solutions.
Table of Contents
To support our AI capabilities, in 2025, we acquired eSelf AI, a multimodal AI lab developing technology for agentic interactions with live avatars. Through this acquisition, we expanded our content creation and experience capabilities to include AI-generated video and avatar-based interactions, enhancing our rich media content creation layer. In addition, in March, 2026, we entered into a definitive agreement to acquire PathFactory, a provider of content journey orchestration and engagement analytics solutions. We believe this acquisition, once completed, would strengthen our position in the emerging conversation automation and agentic engagement solutions market and complement our recent acquisition of eSelf AI by adding journey-level orchestration, intent data, analytics, and integrations across additional content types and enterprise systems. The transaction has not yet closed, and there can be no assurance that it will be completed or that the anticipated benefits will be realized.
We generate revenue primarily from the sale of Software-as-a-Service (“SaaS”) subscriptions, and we also derive revenue from platform usage license subscriptions and associated professional services. Our sales typically target medium to large enterprises, educational institutions, technology providers, and media and telecom companies. In addition, we are expanding our go-to-market approaches to support a wider range of adoption models and customer sizes. Our professional services revenue is generally driven by implementation and support services for new and existing customers.
In August 2025, our Board of Directors approved a reorganization plan (the “2025 Reorganization Plan) that included, among other things, downsizing approximately 10% of our workforce and adapting our organizational structure, roles, and responsibilities accordingly. The total cost reduction from the downsizing in connection with the 2025 Reorganization Plan on an annualized basis is expected to be approximately $8.5 million. The 2025 Reorganization Plan, which was completed in the third quarter of 2025, is focused on realigning the Company’s operations to further increase efficiency and productivity, alongside our integration of enhanced AI-based technologies, to align the Company’s business strategy in light of uncertainties in the current macro-economic climate, and to support the Company’s growth and profitability initiatives.
We organize our business into two reporting segments: (i) Enterprise, Education, and Technology (“EE&T”); and (ii) Media and Telecom (“M&T”). Accordingly, our financial reporting distinguishes between revenue and gross profit from Subscription and Professional Services from customers who use our products and services to address Entertainment & Monetization use cases (for their audiences), reported in our M&T segment, and those that are attained from customers who are using us to address all other use cases (for their customers, employees, and learners), reported in our EE&T segment. These segments share a common underlying platform consisting of our API-based architecture, as well as unified product development, operations, and administrative resources.
•Enterprise, Education & Technology: In the EE&T segment, subscription revenue is primarily generated on a per full‑time equivalent or platform usage‑license basis for all of our products, in addition to revenue derived from associated professional services. This segment encompasses customers utilizing Kaltura’s solutions to deliver agentic rich-media experiences for their customers, employees, and learners such as buyer enablement, employee recruiting, learning and teaching. Contracts in this segment typically range from 12 to 24 months, with billing generally executed on an annual basis.
•Media & Telecom: The M&T segment includes revenue from customers using Kaltura to deliver entertainment and streaming use cases to their audiences, along with the associated professional services. For customers of our telecom TVCMS and TV Streaming Applications, revenue is recognized primarily on a per end‑subscriber basis, while media customers leveraging our Online Video Platform are billed on a platform usage‑license basis. Contracts in this segment generally extend for two to five years, with billing performed on either a quarterly or annual basis. Implementation of TV offerings typically requires six to 12 months, with upfront resource requirements generally higher than those for our other offerings. Consequently, there is an extended period from initial booking to go‑live, accompanied by a higher proportion of professional services revenue relative to overall revenue. Additionally, a greater share of revenue in this segment is derived from customers licensing our offerings through private cloud and on‑premise deployments, which has an impact on our gross margin.
87
Table of Contents
Reflected below is a summary of reportable segment revenue and reportable segment gross profit for the years ended December 31, 2025, 2024 and 2023.
For the Year Ended December 31,
2025
2024
2023
(in thousands)
Revenue
Enterprise, Education & Technology
$
134,435
$
128,704
$
125,154
Media & Telecom
46,419
50,013
50,018
Total Revenue
$
180,854
$
178,717
$
175,172
Gross Profit
Enterprise, Education & Technology
103,955
96,928
91,624
Media & Telecom
23,714
22,178
20,610
Total Gross Profit
$
127,669
$
119,106
$
112,234
We employ a “land and expand” strategy with the aim of having our customers increase their usage of our offerings and/or purchase additional offerings over time. For the years ended December 31, 2025 and 2024, our Net Dollar Retention Rate was 100%. Our Annualized Recurring Revenue (as defined below), declined by 3% in the year ended December 31, 2025, compared to the year ended December 31, 2024.
For any given year, a large majority of our revenue comes from existing customers, with whom we are in active dialogue and tend to have visibility into their expected usage of our offerings.
We are expanding our go-to-market approaches to support a wider range of adoption models and customer sizes. We believe certain of our newer offerings, particularly AI-assisted content creation tools and conversational rich media agents, are well suited for more targeted departmental deployments, self-service adoption, and product-led growth (“PLG”) motions. These offerings may enable us to engage smaller organizations, teams, and departments, including small and medium-sized businesses (“SMBs”) and individual groups within larger enterprises, while remaining complementary to our core enterprise business. In addition, we are investing in developer-led growth (“DLG”) initiatives by expanding our APIs, SDKs, and developer tools, including planned offerings such as an Agentic Avatar SDK. These capabilities are designed to enable independent software vendors (“ISVs”), system integrators, partners, and developers to embed Kaltura-powered rich media and conversational interfaces into their own products, workflows, and applications. We also intend to continue expanding our ecosystem of channel partners, including co-sell, resell, OEM, and marketplace relationships. We believe that broader partner distribution, including through cloud marketplaces and digital channels, may increase reach, reduce customer acquisition costs, and accelerate adoption across both enterprise and self-service use cases.
Key Factors Affecting Our Performance
Expansion of our Platform
We believe our platform is ideally suited for expansion across solutions, industries, and use cases. For example, in 2020, we entered the real-time conferencing market with the introduction of our Virtual and Hybrid Events, Webinars, and Online Learning products, focusing on learning, training, events, and marketing. Since then, we expanded the capabilities of our Virtual & Hybrid Events product to support a broader range of event types and use cases, fitted them to also address low-touch and self-serve sales and introduced a set of Gen AI-powered capabilities designed to increase productivity in creating content and setting up events and to foster user engagement. We plan to continue enhancing our platform’s capabilities—including by further integrating Gen AI features that enable automatic video creation, advanced personalization, and real-time analytics. Our robust API-first architecture supports deep integration into multiple workflows, which we believe is critical for driving adoption and delivering enhanced value for our customers.
88
Table of Contents
Acquiring New Customers
We remain focused on acquiring customers across our key verticals (technology, education, regulated industries, professional and commercial services, and media & telecom). Our approach includes direct enterprise sales for larger customers, as well as channel partnerships and more self-serve or inside sales–led motions to capture small and medium enterprises (“SMEs”). We believe that increasing brand awareness and continued product innovation will help us attract new customers across geographies and industries. We also continue to provide our self-serve offering that can be purchased completely online, which serves as a demand generation engine for our low-touch and enterprise offerings. We believe this will enable us to efficiently acquire smaller customers across all industries over time – expanding beyond enterprises into SMEs, beyond universities into K-12 schools, beyond tier 1 media and telecom companies to tier 2 and 3 media and telecom companies, and beyond providing our platform to large technology companies to also addressing smaller technology firms and startups.
Increasing Revenue from Existing Customers
Many of our customers run multiple Kaltura products for various use cases, ranging from employee training and collaboration to external marketing and virtual events. By cross-selling and upselling additional solutions — such as our newly introduced Gen AI-powered capabilities and expanded application suites — we aim to drive higher usage and expand overall revenue. Our strong integration, ongoing support, and a commitment to evolving security and compliance requirements also helps us support sustained customer adoption and usage growth. We are focused on increasing sales within our existing customer base through increased usage of our platform and the cross-selling of additional products and solutions. For the year ended December 31, 2025, our Net Dollar Retention Rate was 100%. In order for us to increase revenue within our customer base, we will need to maintain engineering-level customer support and continue to introduce new products and features as well as innovative new use cases that are tailored to our customers' needs.
Continued Investment in Growth
Although we have invested significantly in our business to date, we believe that we still have a significant market opportunity ahead of us. We intend to continue to make investments to support the growth and expansion of our business and to increase revenue. We believe there is a significant opportunity to continue our growth. We expect that our cost of revenue and operating expenses will fluctuate over time.
Key Financial and Operating Metrics
We measure our business using both financial and operating metrics. We use these metrics to assess the progress of our business, make decisions on where to allocate capital, time, and technology investments, and assess the near-term and long-term performance of our business. The key financial and operating metrics we use are:
For the Year Ended December 31,
2025
2024
2023
(in thousands, except percentages)
Net Dollar Retention Rate
100
%
100
%
101
%
As of December
2025
2024
2023
(in thousands)
Remaining Performance Obligations(1)
$
166,347
$
176,947
$
165,010
Annualized Recurring Revenue
$
168,197
$
173,900
$
164,723
(1) Remaining Performance Obligations as of December 31, 2024 and December 31, 2023 reflect a reassessment of the historical treatment of certain customer contracts that contain “termination for convenience” clauses, which has resulted in a negative adjustment of $26,432 and,$20,295, respectively.
89
Table of Contents
Annualized Recurring Revenue
We use Annualized Recurring Revenue ("ARR") as a measure of our revenue trend and an indicator of our future revenue opportunity from existing recurring customer contracts. We calculate ARR by annualizing our recurring revenue for the most recently completed fiscal quarter. Recurring revenues are generated from SaaS and PaaS subscriptions, as well as term licenses for software installed on the customer’s premises (“On-Prem”). For the SaaS and PaaS components, we calculate ARR by annualizing the actual recurring revenue recognized for the latest fiscal quarter.
For the On-Prem components for which revenue recognition is not ratable across the license term, we calculate ARR for each contract by dividing the total contract value (excluding professional services) as of the last day of the specified period by the number of days in the contract term and then multiplying by 365.
Recurring revenue excludes revenue from one-time professional services and setup fees. ARR is not adjusted for the impact of any known or projected future customer cancellations, upgrades or downgrades, or price increases or decreases.
The amount of actual revenue that we recognize over any 12-month period is likely to differ from ARR at the beginning of that period, sometimes significantly. This may occur due to new bookings, cancellations, upgrades or downgrades, pending renewals, professional services revenue, foreign exchange rate fluctuations and acquisitions or divestitures. ARR should be viewed independently of revenue as it is an operating metric and is not intended to be a replacement or forecast of revenue. Our calculation of ARR may differ from similarly titled metrics presented by other companies.
Net Dollar Retention Rate
Our Net Dollar Retention Rate, which we use to measure our success in retaining and growing recurring revenue from our existing customers, compares our recognized recurring revenue from a set of customers across comparable periods. We calculate our Net Dollar Retention Rate for a given period as the recognized recurring revenue from the latest reported fiscal quarter from the set of customers whose revenue existed in the reported fiscal quarter from the prior year (the numerator), divided by recognized recurring revenue from such customers for the same fiscal quarter in the prior year (denominator). For annual periods, we report Net Dollar Retention Rate as the arithmetic average of the Net Dollar Retention Rate for all fiscal quarters included in the period. We consider subdivisions of the same legal entity (for example, divisions of a parent company or separate campuses that are part of the same state university system) ,as well as Value-add Resellers (“VARs”) (meaning resellers that directly manage the relationship with the customer) and the customers they manage, to be a single customer for purposes of calculating our Net Dollar Retention Rate. Our calculation of Net Dollar Retention Rate for any fiscal period includes the positive recognized recurring revenue impacts of selling new services to existing customers and the negative recognized recurring revenue impacts of contraction and attrition among this set of customers. Our Net Dollar Retention Rate may fluctuate as a result of a number of factors, including the growing level of our revenue base, the level of penetration within our customer base, expansion of products and features, and our ability to retain our customers. Our calculation of Net Dollar Retention Rate may differ from similarly titled metrics presented by other companies.
Remaining Performance Obligations
Remaining Performance Obligations represents the amount of contracted future revenue that has not yet been delivered, including both subscription and professional services revenues. Remaining Performance Obligations consists of both deferred revenue and contracted non-cancelable amounts that will be invoiced and recognized in future periods. As of December 31, 2025, our Remaining Performance Obligations was $166.3 million, which consists of both billed consideration in the amount of $62.4 million and unbilled consideration in the amount of $103.9 million that we expect to invoice and recognize in future periods. We expect to recognize 64% of our Remaining Performance Obligations as revenue over the next 12 months and the remainder over the next four years.
Non-GAAP Financial Measures
In addition to our results determined in accordance with GAAP, we believe that EBITDA and Adjusted EBITDA, non-GAAP financial measures, are useful in evaluating the performance of our business.
We define EBITDA as net profit (loss) before financial expenses (income), net, provision for income taxes and depreciation and amortization expenses. Adjusted EBITDA is defined as EBITDA (as defined above), adjusted for the impact of certain non-cash and other items that we believe are not indicative of our core operating performance, such as non-cash stock-based compensation expenses, facility exit and transition costs, war-related expenses, restructuring charges, certain professional consulting and other expenses associated with strategic initiatives and acquisition related expenses.
90
Table of Contents
EBITDA and Adjusted EBITDA are supplemental measures of our performance, are not defined by or presented in accordance with GAAP, and should not be considered in isolation or as an alternative to net profit (loss) or any other performance measure prepared in accordance with GAAP. EBITDA and Adjusted EBITDA are presented because we believe that they provide useful supplemental information to investors and analysts regarding our operating performance and are frequently used by these parties in evaluating companies in our industry. By presenting EBITDA and Adjusted EBITDA, we provide a basis for comparison of our business operations between periods by excluding items that we do not believe are indicative of our core operating performance. We believe that investors’ understanding of our performance is enhanced by including these non-GAAP financial measures as a reasonable basis for comparing our ongoing results of operations. Additionally, our management uses Adjusted EBITDA as a supplemental measure of our performance because it assists us in comparing the operating performance of our business on a consistent basis between periods, as described above.
Although we use EBITDA and Adjusted EBITDA, as described above, EBITDA and Adjusted EBITDA, have significant limitations as analytical tools. Some of these limitations include:
•such measures do not reflect our cash expenditures, or future requirements for capital expenditures or contractual commitments;
•such measures do not reflect changes in, or cash requirements for, our working capital needs;
•such measures do not reflect the interest expense, or the cash requirements necessary to service interest or principal payments on our debt;
•such measures do not reflect our tax expense or the cash requirements to pay our taxes;
•although depreciation and amortization expense and non-cash stock-based compensation expense are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future and such measures do not reflect any cash requirements for such replacements; and
•other companies in our industry may calculate such measures differently than we do, thereby further limiting their usefulness as comparative measures.
Due to these limitations, EBITDA and Adjusted EBITDA should not be considered as measures of discretionary cash available to us to invest in the growth of our business. We compensate for these limitations by relying primarily on our GAAP results and using these non-GAAP measures only supplementally. Adjusted EBITDA includes an adjustment for non-cash stock-based compensation expenses. It is reasonable to expect that this item will occur in future periods. However, we believe this adjustment is appropriate because the amount recognized can vary significantly from period to period, does not directly relate to the ongoing operations of our business, and complicates comparisons of our internal operating results between periods and with the operating results of other companies over time. Each of the normal recurring adjustments and other adjustments described above help to provide management with a measure of our core operating performance over time by removing items that are not related to day-to-day operations. Nevertheless, because of the limitations described above, management does not view EBITDA, or Adjusted EBITDA in isolation and also uses other measures, such as revenue, operating loss, and net loss, to measure operating performance.
91
Table of Contents
The following table reconciles EBITDA and Adjusted EBITDA to the most directly comparable GAAP financial performance measure, which is net loss:
Year Ended December 31,
2025
2024
2023
(in thousands)
Net loss
$
(12,072)
$
(31,315)
$
(46,366)
Financial expenses (income), net (a)
4,047
(434)
(1,200)
Provision for income taxes
3,062
7,650
8,911
Depreciation and amortization
4,503
5,064
4,717
EBITDA
(460)
(19,035)
(33,938)
Non-cash stock-based compensation expense
16,492
26,264
29,980
Facility exit and transition costs (b)
—
—
154
Restructuring (c)
903
—
973
War related costs (d)
—
44
331
Strategic initiatives expenses (e)
1,284
—
—
Acquisition related expenses (f)
428
—
—
Adjusted EBITDA
$
18,647
$
7,273
$
(2,500)
(a)The years ended December 31, 2025, 2024 and 2023 include $2.2 million, $2.7 million and $3.2 million, respectively, of interest expenses, and $3.0 million, $3.4 million and $2.7 million, respectively, of interest income.
(b)Facility exit and transition costs for the year ended December 31, 2023 include losses from sale of fixed assets and other costs associated with moving to our temporary office in Israel.
(c)The year ended December 31, 2025, includes employee termination benefits incurred in connection with the 2025 Reorganization Plan and the year ended December 31, 2023 includes employee termination benefits incurred in connection with the 2023 Restructuring Plan.
(d)The years ended December 31, 2024 and December 31, 2023 include costs related to conflicts in Israel. These costs are attributable to the temporary relocation of key employees from Israel for business continuity purposes, the purchase of emergency equipment for key employees, charitable donations to communities directly impacted by the war, and office fixes and modifications.
(e)Strategic initiatives expenses for the year ended December 31, 2025 relate to professional fees, consulting services and other costs associated with strategic initiatives.
(f)Acquisition related expenses for the year ended December 31, 2025 consist of professional fees, consulting services and other transaction-related costs incurred in connection with the acquisition of eSelf AI.
Components of Results of Operations
Revenue
Subscription
Our revenues are mainly comprised of revenue from SaaS and PaaS subscriptions. SaaS and PaaS subscriptions provide access to our Video Experience Cloud which powers all types of video experiences: live, real-time, and on-demand video. We provide access to our platform either as a cloud-based service, which represent most of our SaaS and PaaS subscriptions, or, less commonly, as a term license to software installed on the customer's premises. Revenue from SaaS and PaaS subscriptions is recognized ratably over the time of the subscription, beginning from the date on which the customer is granted access to our Video Experience Cloud.
92
Table of Contents
Revenue from the sale of a term license is recognized at a point in time in which the license is delivered to the customer. Revenue from post-contract services (“PCS”) included in On-Prem deals is recognized ratably over the period of the PCS.
Professional Services
Our revenue also includes professional services, which consist of consulting, integration and customization services, technical solution services and training related to our video experience. In some of our arrangements, professional services are accounted for as a separate performance obligation, and revenue is recognized upon rendering of the service.
In some of our SaaS and PaaS subscriptions, we determined that the professional services are solely set up activities that do not transfer goods or services to the customer and therefore are not accounted for as a separate performance obligation and are recognized ratably over the time of the subscription.
Cost of Revenue
Cost of subscription revenue consists primarily of employee-related costs including payroll, benefits and stock-based compensation expense for operations and customer support teams, costs of cloud hosting providers and other third-party service providers, amortization of capitalized software development costs and acquired technology and allocated overhead costs.
Cost of professional services consists primarily of personnel costs of our professional services organization, including payroll, benefits, and stock-based compensation expense, allocated overhead costs and other third-party service providers.
The costs associated with providing professional services are significantly higher as a percentage of related revenue than the costs associated with delivering our subscriptions due to the labor costs of providing professional services. As such, the implementation and professional services costs relating to an arrangement with a new customer are more significant than the costs to renew an existing customer’s license and support arrangement.
Cost of revenue decreased in absolute dollars from the year ended December 31, 2024 to the year ended December 31, 2025. For the years ended December 31, 2025 and 2024, our cost of revenue was $53,185 and $59,611, respectively.
Gross Margins
Gross margin has improved year-over-year since 2020, and while it has and will continue to vacillate between quarters, we expect it to continue the growth trend in the coming years. Gross margins have been, and will continue to be, affected by a variety of factors, including the average sales price of our products and services, volume growth, the mix of revenue between software licenses, maintenance and support, professional services, onboarding of new media and telecom customers, hosting of major virtual events, and changes in cloud infrastructure and personnel costs. In particular, the gross margins in the M&T segment are lower than in the EE&T segment because of resources required for implementing solutions for TV experiences, which generally exceed those of other offerings. This results in a longer period for M&T from initial booking to go-live and a higher proportion of professional services revenue as a percentage of overall revenue. Additionally, a higher proportion of M&T revenue comes from customers who choose to license our offerings through private cloud and on-premise deployments, which also impacts our M&T gross margin. Going forward, we expect to see a gradual improvement in gross margins for both EE&T and M&T, driven by enhanced efficiencies in both production and professional services costs.
For the years ended December 31, 2025, 2024 and 2023, our gross margins were 71% (77% for subscription and (54)% for professional services), 67% (75% for subscription and (55)% for professional services) and 64% (73% for subscription and (51)% for professional services), respectively.
For our EE&T segment, gross margins for the years ended December 31, 2025, 2024 and 2023 were 77% (83% for subscription and (138)% for professional services), 75% (82% for subscription and (97)% for professional services) and 73% (79% for subscription and (78)% for professional services), respectively.
For our M&T segment, gross margins for the years ended December 31, 2025, 2024 and 2023 were 51% (57% for subscription and 2% for professional services), 44% (55% for subscription and (25)% for professional services) and 41% (55% for subscription and (35)% for professional services), respectively.
93
Table of Contents
Research and Development
Our research and development expenses consist primarily of costs incurred for personnel-related expenses for our technical staff, including salaries and other direct personnel-related costs. Additional expenses include consulting and professional fees for third-party development resources and software subscriptions. We expect our research and development expenses to gradually decrease as a percentage of revenue. Subsequent costs incurred for the development of future upgrades and enhancements, which are expected to result in additional functionality, may qualify for capitalization under internal-use software and therefore may cause research and development expenses to fluctuate.
Sales and Marketing Expenses
Our sales and marketing expenses consist primarily of personnel related costs for our sales and marketing functions, including salaries and other direct personnel-related costs, such as sales commissions.
Additional expenses include marketing program costs and amortization of acquired customer relationships intangible assets. We expect our sales and marketing expenses to increase as a percentage of revenue.
General and Administrative Expenses
Our general and administrative expenses consist primarily of personnel-related costs for our executive, finance, human resources, information technology, and legal functions, including salaries and other direct personnel-related costs. Additional expenses include costs for other operational and administrative functions, professional fees for external legal, accounting, and consulting services, directors’ and officers’ insurance, and strategic initiatives. We expect our general and administrative expenses to gradually decrease as a percentage of revenue.
We allocate overhead costs such as rent, utilities, and supplies to all departments based on relative headcount to each operating expense category.
Financial Expenses (Income), Net
Financial expenses (income), net consists of interest expense accrued or paid on our indebtedness, net of interest income earned on our cash balances and marketable securities. Financial expenses (income), net also includes foreign exchange gains and losses and bank fees.
We expect interest expenses to vary each reporting period depending on the amount of outstanding indebtedness and prevailing interest rates.
We expect interest income will vary in each reporting period depending on our average cash and marketable securities balances during the period and applicable interest rates.
Provision for Income Taxes
We are subject to taxes in the United States as well as other tax jurisdictions or countries in which we conduct business. Earnings from our non-U.S. activities are subject to local country income tax and may be subject to current U.S. income tax. Due to cumulative losses, we maintain a valuation allowance against our deferred tax assets. We consider all available evidence, both positive and negative, in assessing the extent to which a valuation allowance should be applied against our deferred tax assets. Realization of our U.S. deferred tax assets depends upon future earnings, the timing and amount of which are uncertain. Our effective tax rate is affected by tax rates in foreign jurisdictions and the relative amounts of income we earn in those jurisdictions, as well as non-deductible expenses, such as share-based compensation, and changes in our valuation allowance.
94
Table of Contents
Results of Operations
The following table summarizes key components of our results of operations for the periods presented. The period-to-period comparisons of our historical results are not necessarily indicative of the results that may be expected in the future.
Year Ended December 31,
Period-over-Period Change
2025
2024
Dollar
Percentage
Revenue:
(in thousands, except percentages)
Enterprise, Education & Technology
$
134,435
$
128,704
$
5,731
4
%
Media & Telecom
46,419
50,013
(3,594)
(7)
%
Total revenue
180,854
178,717
2,137
1
%
Cost of revenue
53,185
59,611
(6,426)
(11)
%
Total gross profit
127,669
119,106
8,563
7
%
Operating expenses:
Research and development expenses
45,992
49,430
(3,438)
(7)
%
Sales and marketing expenses
44,899
47,766
(2,867)
(6)
%
General and administrative expenses
40,838
46,009
(5,171)
(11)
%
Restructuring
903
—
903
NM
Total operating expenses
132,632
143,205
(10,573)
(7)
%
Loss from operations
4,963
24,099
(19,136)
(79)
%
Financial expenses (income), net
4,047
(434)
4,481
(1032)
%
Loss before provision for income taxes
9,010
23,665
(14,655)
(62)
%
Provision for income taxes
3,062
7,650
(4,588)
(60)
%
Net loss
$
12,072
$
31,315
$
(19,243)
(61)
%
Comparison of the Years Ended December 31, 2025 and 2024
Segments
We currently manage and report operating results through two reportable segments.
•Enterprise, Education & Technology (74% and 72% of revenue for the year ended December 31, 2025 and 2024, respectively): Our EE&T segment represents revenues from all of our products, industry solutions for education customers, and Media Services (except for M&T customers), as well as associated professional services for those offerings.
•Media & Telecom (26% and 28% of revenue for the year ended December 31, 2025 and 2024, respectively): Our M&T segment primarily represents revenues from our TV Solution and Media Services sold to media and telecom customers.
95
Table of Contents
Enterprise, Education & Technology
The following table presents our EE&T segment revenue and gross profit (loss) for the years indicated:
Year Ended December 31,
Period-over-Period Change
2025
2024
Dollar
Percentage
(in thousands, except percentages)
Enterprise, Education & Technology revenue:
Subscription
$
130,885
$
124,215
$
6,670
5
%
Professional services
3,550
4,489
(939)
(21)
%
Total Enterprise, Education & Technology revenue
$
134,435
$
128,704
$
5,731
4
%
Total Enterprise, Education & Technology gross profit (loss):
Subscription
$
108,861
$
101,284
$
7,577
7
%
Professional services
(4,906)
(4,356)
(550)
13
%
Total Enterprise, Education & Technology gross profit
$
103,955
$
96,928
$
7,027
7
%
Enterprise, Education & Technology Revenue
Total EE&T revenue increased by $5.7 million , or 4%, to $134.4 million for the year ended December 31, 2025, from $128.7 million for the year ended December 31, 2024. The increase is mainly attributable to a $1.6 million increase in revenue from new customers, and a $4.1 million increase from existing customers.
EE&T subscription revenue increased by $6.7 million, or 5%, to $130.9 million for the year ended December 31, 2025, from $124.2 million for the year ended December 31, 2024.
EE&T professional services revenue decreased by $0.9 million, or 21%, to $3.6 million for the year ended December 31, 2025, from $4.5 million for the year ended December 31, 2024. The decrease in professional services revenue mainly reflects the transition of certain development projects to ongoing support and maintenance, now recognized as subscription revenue.
Enterprise, Education & Technology Gross Profit
EE&T gross profit increased by $7.0 million, or 7%, to $104.0 million for the year ended December 31, 2025, from $96.9 million for the year ended December 31, 2024. This increase was mainly due to a $5.7 million increase in revenue, lower headcount and reduction in production costs, which is a result of improved efficiency.
EE&T subscription gross profit increased by $7.6 million, or 7%, to $108.9 million for the year ended December 31, 2025, from $101.3 million for the year ended December 31, 2024.
EE&T professional services gross loss increased by $0.6 million, or 13%, to $4.9 million for the year ended December 31, 2025, from a gross loss of $4.4 million for the year ended December 31, 2024. The increase was primarily due to a reduction in professional services revenue.
96
Table of Contents
Media & Telecom
The following table presents our M&T segment revenue and gross profit for the periods indicated:
Year Ended December 31,
Period-over-Period Change
2025
2024
Dollar
Percentage
(in thousands, except percentages)
Media & Telecom revenue:
Subscription
$
41,055
$
43,466
$
(2,411)
(6)
%
Professional services
5,364
6,547
(1,183)
(18)
%
Total Media & Telecom revenue
$
46,419
$
50,013
$
(3,594)
(7)
%
Media & Telecom gross profit (loss):
Subscription
$
23,581
$
23,845
$
(264)
(1)
%
Professional services
133
(1,667)
1,800
108
%
Total Media & Telecom gross profit
$
23,714
$
22,178
$
1,536
7
%
Media & Telecom Revenue
Total M&T revenue decreased by $3.6 million, or 7% to $46.4 million for the year ended December 31, 2025, from $50.0 million for the year ended December 31, 2024. The decrease is mainly attributable to $3.6 million decrease in revenue from existing customers.
M&T subscription revenue decreased by $2.4 million, or 6%, to $41.1 million for the year ended December 31, 2025, from $43.5 million for the year ended December 31, 2024.
M&T professional services revenue decreased by $1.2 million, or 18%, to $5.4 million for the year ended December 31, 2025, from $6.5 million for the year ended December 31, 2024.
Media & Telecom Gross Profit
M&T gross profit increased by $1.5 million, or 7%, to $23.7 million for the year ended December 31, 2025, from $22.2 million for the year ended December 31, 2024. This increase was mainly due to reduction in production and other costs, which is a result of improved efficiency, and reductions in headcount and subcontractor costs following organizational changes implemented at the end of 2024 and in August 2025.
M&T subscription gross profit decreased by $0.3 million, or 1%, to $23.6 million for the year ended December 31, 2025, from $23.8 million for the year ended December 31, 2024.
M&T professional services gross profit increased by $1.8 million, or 108%, to a gross profit of $0.1 million for the year ended December 31, 2025, from a gross loss of $1.7 million for the year ended December 31, 2024. The increase in professional services gross profit was primarily driven by reductions in headcount and subcontractor costs following organizational changes implemented at the end of 2024 and in August 2025.
97
Table of Contents
Operating Expenses
Research and Development Expenses
Year Ended December 31,
Period-over-Period Change
2025
2024
Dollar
Percentage
(in thousands, except percentages)
Employee compensation
$
31,533
$
34,413
$
(2,880)
(8)
%
Subcontractors and consultants
6,007
7,043
(1,036)
(15)
%
IT related
4,725
4,847
(122)
(3)
%
Other
3,727
3,127
600
19
%
Total research and development expenses
$
45,992
$
49,430
$
(3,438)
(7)
%
Research and development expenses decreased by $3.4 million, or 7%, to $46.0 million for the year ended December 31, 2025, from $49.4 million for the year ended December 31, 2024. The decrease was primarily due to a $2.9 million decrease in compensation expenses which were driven by the full recognition of high fair value RSUs granted in December 2021, which were fully expensed prior to 2025. In addition the decrease was also due to a $1.0 million decrease in subcontractor and consultant costs, primarily attributable to reduced use of outsourced resources.
Sales and Marketing Expenses
Year Ended December 31,
Period-over-Period Change
2025
2024
Dollar
Percentage
(in thousands, except percentages)
Employee compensation & commission
$
35,943
$
39,182
$
(3,239)
(8)
%
Subcontractors and consultants
932
685
247
36
%
IT related
1,244
1,131
113
10
%
Marketing expenses
3,244
3,366
(122)
(4)
%
Travel and entertainment
1,072
1,123
(51)
(5)
%
Other
2,464
2,279
185
8
%
Total sales and marketing expenses
$
44,899
$
47,766
$
(2,867)
(6)
%
Sales and marketing expenses decreased by $2.9 million, or 6%, to $44.9 million for the year ended December 31, 2025, from $47.8 million for the year ended December 31, 2024. The decrease was primarily due to a $3.2 million decrease in compensation expenses mainly due to lower headcount and full recognition of high fair value RSUs granted in December 2021, which were fully expensed prior to 2025.
98
Table of Contents
General and Administrative Expenses
Year Ended December 31,
Period-over-Period Change
2025
2024
Dollar
Percentage
(in thousands, except percentages)
Employee compensation
$
27,475
$
32,284
$
(4,809)
(15)
%
Professional fees and insurance
3,940
4,329
(389)
(9)
%
IT related
2,618
2,381
237
10
%
Human resources related
1,312
1,328
(16)
(1)
%
Subcontractors and consultants
960
1,413
(453)
(32)
%
Travel and entertainment
782
751
31
4
%
Unused cloud hosting commitment expense
—
1,312
(1,312)
NM
Strategic initiatives
1,284
—
1,284
NM
Acquisition related expenses
428
—
428
NM
Other
2,039
2,211
(172)
(8)
%
Total general and administrative expenses
$
40,838
$
46,009
$
(5,171)
(11)
%
General and administrative expenses decreased by $5.2 million or 11% , to $40.8 million for the year ended December 31, 2025, from $46.0 million for the year ended December 31, 2024. The decrease was primarily due to a $4.8 million decrease in compensation costs mainly driven by expense acceleration recognized in the comparative period in connection with the cancellation of unvested market-based equity awards granted to the Chief Executive Officer, and by lower stock-based compensation costs, largely reflecting the full recognition of high fair value options and RSUs granted in December 2021, which were fully expensed prior to 2025. The decrease also reflects a $1.3 million one-time expense in 2024 associated with the termination of commitments with a cloud hosting service provider. These were partially offset by a $1.3 million increase in strategic initiatives costs, primarily due to professional, consulting, and other expenses, as well as by a $0.4 million increase in acquisition related expenses, incurred in connection with the acquisition of eSelf AI.
Restructuring
Restructuring expenses were $0.9 million for the year ended December 31, 2025 due to the 2025 Reorganization Plan being implemented in the third quarter of 2025 and consisting of employee severance and related costs.
Financial Expenses (Income), net
Financial expense (income), net changed by $4.5 million, to $4.0 million expense, for the year ended December 31, 2025, from $0.4 million income for the year ended December 31, 2024. The change was mainly related to increased expense of $4.5 million related to exchange rate differences primarily driven by the revaluation of NIS‑denominated liabilities. As the USD weakened against the NIS during 2025, these liabilities were remeasured at a lower USD–ILS exchange rate, resulting in a higher carrying amount in USD terms and consequently higher foreign exchange expenses.
Provision for Income Taxes
Provision for income taxes decreased by $4.6 million, or 60%, to $3.1 million for the year ended December 31, 2025, from $7.7 million for the year ended December 31, 2024, primarily due to a decreased tax liability related to income generated by our subsidiaries organized under the laws of Israel.
Liquidity and Capital Resources
Overview
Since our inception, we have financed our operations primarily through net cash provided by operating activities, equity issuances, and borrowings under our long-term debt arrangements. Our primary requirements for liquidity and capital are to finance working capital, capital expenditures and general corporate purposes. Our principal sources of liquidity are expected to be our cash on hand and borrowings available under our Revolving Credit Facility. As of December 31, 2025, we had no balance outstanding under the Revolving Credit Facility and the total revolving commitment of $25.0 million is available for future borrowings.
99
Table of Contents
We believe that our net cash provided by operating activities, cash on hand, and availability under our Revolving Credit Facility will be adequate to meet our operating, investing, and financing needs for at least the next 12 months.
Our future capital requirements will depend on many factors, including our revenue growth, the timing and extent of investments to support such growth, the expansion of sales and marketing activities, increases in general and administrative costs and many other factors as described under Part I, Item 1A. “Risk Factors” and “—Key Factors Affecting Our Performance.” In addition, our cash and cash equivalents are maintained at financial institutions in amounts that exceed federally insured limits.
In the event of failure of any of the financial institutions where we maintain our cash and cash equivalents, there can be no assurance that we will be able to access uninsured funds in a timely manner or at all.
If necessary, we may borrow funds under our Revolving Credit Facility to finance our liquidity requirements, subject to customary borrowing conditions. To the extent additional funds are necessary to meet our long-term liquidity needs as we continue to execute our business strategy, we anticipate that they will be obtained through the incurrence of additional indebtedness, additional equity financings or a combination of these potential sources of funds; however, such financing may not be available on favorable terms, or at all. In particular, the current global economic volatility, including due to uncertainty around U.S. and foreign tariffs and other trade barriers, rising inflation and uncertainty with respect to interest rates, price increases and supply chain issues, deteriorating global political conditions and various other factors, has resulted in, and may continue to result in, significant disruption of global financial markets, reducing our ability to access capital. Our ability to access capital may also be impacted by political, economic, and military conditions in Israel, including the current security situation or any escalation of conflicts with Israel, and in other regions in which we operate, or changes in the business environment in those regions. If we are unable to raise additional funds when desired, our business, financial condition and results of operations could be adversely affected.
Repurchase Program
In June 2024, the Company’s Board of Directors authorized a stock repurchase program of the Company’s outstanding common stock (the “2024 Repurchase Program”), which provided for repurchases up to a total of $5 million thereunder. Subsequently, in March 2025, the Board approved a new repurchase program (the “2025 Repurchase Program”), providing for repurchases up to a total of $15 million thereunder, which superseded the 2024 Repurchase Program.
On November 7, 2025, pursuant to additional repurchase authority approved by the Board, the Company entered into a stock purchase agreement (the “2025 Stock Purchase Agreement” ) with Special Situations Investing Group II, LLC (the “Sellers”), pursuant to which the Company has repurchased 14,443,739 shares of Common Stock from the Sellers at a purchase price of $16,610,300, representing a price per share of $1.15 for each of the Company’s share of common stock, calculated on the basis of a 25% discount over the average daily VWAP over the 30-day period ending on November 5, 2025. In addition, the Board terminated the 2025 Repurchase Program.
During the year ended December 31, 2025, the Company repurchased 19,087,579 shares of common stock at an weighted average price of $1.37 per share (excluding broker and transaction fees of $139).
Credit Facilities
In January 2021, we entered into a credit agreement (as amended, the “Credit Agreement”) with one of our existing lenders, which provided for a senior secured term loan facility in the aggregate principal amount of $40.0 million (the “Term Loan Facility”) and a senior secured revolving credit facility in the aggregate principal amount of $10.0 million (the “Revolving Credit Facility” and, together with the Term Loan Facility, the “Credit Facilities”), which thereafter were extended and amended to align our business needs and other developments. In December 2023, we refinanced all amounts outstanding under the then-existing Credit Agreement, and entered into a new amendment to the credit agreement (the “Fifth Amendment”) with an existing lender, which provides for an additional term loan facility of $3.5 million in addition to the existing $31.5 million in term loans outstanding immediately prior to the Fifth Amendment. Commitments under the Revolving Credit Facility decreased to $25.0 million.
In July 2024, we entered into an amendment to the Credit Agreement with an existing lender, in connection with our share repurchase program, which updated the aggregate amount of permitted Restricted Payments (as defined in the Credit Agreement, which term includes, among other things, the repurchase of the Company’s outstanding common stock) and conditions for making such payments.
100
Table of Contents
In March 2025 and October 2025, the Company entered into additional amendments to the Credit Agreement, each of which provided for, among other things, an increase to the aggregate amount of permitted Restricted Payments and updates to the conditions for making such payments to facilitate the Company’s repurchases of securities.
On October 20, 2025, the Company entered into an amendment to the Credit Agreement, which provided for, among other things, an increase to the aggregate amount of permitted Restricted Payments and updates to the conditions for making such payments to facilitate the Company’s repurchases of securities.
The amount available for borrowing under the Revolving Credit Facility is limited to a borrowing base, which is equal to the product of (a) 500% (which will automatically reduce to 350% on the date the Term Loan Facility is repaid in full), multiplied by (b) monthly Recurring Revenue for the most recently ended monthly period, multiplied by (c) the Retention Rate (in each case, as defined in the Credit Agreement).
The Revolving Credit Facility includes a sub-facility for letters of credit in the aggregate availability amount of $10.0 million and a swingline sub-facility in the aggregate availability amount of $5.0 million, each of which reduces borrowing availability under the Revolving Credit Facility.
Following the effectiveness of the Fifth Amendment, borrowings under the Credit Facilities are subject to interest, determined as follows: (a) SOFR loans accrue interest at a rate per annum equal to Term SOFR (as defined in the Credit Agreement) plus 0.10% per annum plus a margin of 2.50% (the Adjusted Term SOFR (as defined in the Credit Agreement) is subject to a 1.00% floor), and (b) ABR loans accrue interest at a rate per annum equal to the ABR plus a margin of 1.50% (ABR is equal to the highest of (i) the prime rate and (ii) the Federal Funds Effective Rate plus 0.50%, subject to a 2.00% floor). As of December 31, 2025, the current rate of interest under the Credit Facilities was equal to a rate per annum of 6.27%, consisting of 3.67% (the 3-month SOFR rate as of December 31, 2025), 0.10% credit spread adjustment and the margin of 2.50%.
We are required to prepay amounts outstanding under the Term Loan Facility with 100% of the net cash proceeds of any indebtedness incurred by us or any of our subsidiaries other than certain permitted indebtedness. In addition, we are required to prepay amounts outstanding under the Credit Facilities with the net cash proceeds of any Asset Sale or Recovery Event (each as defined in the Credit Agreement), subject to certain limited reinvestment rights.
Amounts outstanding under the Credit Facilities may be voluntarily prepaid at any time and from time to time, in whole or in part, without premium or penalty.
All voluntary prepayments (other than ABR loans borrowed under the Revolving Credit Facility) must be accompanied by accrued and unpaid interest on the principal amount being prepaid and customary “breakage” costs, if any, with respect to prepayments of SOFR loans.
The Term Loan Facility is payable in consecutive quarterly installments on the last day of each fiscal quarter in an amount equal to (i) $0.4 million for installments payable on December 31, 2023 (deferred to January 9, 2024), through September 30, 2024 (ii) $0.7 million for installments payable on December 31, 2025 ($0.2 million of the amount deferred to January 2025), through September 30, 2025, and (iii) $1.3 million for installments payable on and after December 31, 2025. The remaining unpaid balance on the Term Loan Facility is due and payable on December 21, 2026, together with accrued and unpaid interest on the principal amount to be paid to, but excluding, the payment date. Amounts outstanding under the Credit Facilities may be voluntarily prepaid at any time and from time to time, in whole or in part, without premium or penalty.
Our obligations under the Credit Facilities are currently guaranteed by Kaltura Europe Limited, and are required to be guaranteed by all of our future direct and indirect subsidiaries other than certain excluded subsidiaries and immaterial foreign subsidiaries. Our obligations and those of Kaltura Europe Limited are, and the obligations of any future guarantors are required to be, secured by a first priority lien on substantially all of our respective assets.
The Credit Agreement contains a number of covenants that, among other things and subject to certain exceptions, restrict our ability, and the ability of our subsidiaries, to:
•create, issue, incur, assume, become liable in respect of or suffer to exist any debt or liens;
•consummate any merger, consolidation or amalgamation, or liquidate, wind up or dissolve, or dispose of all or substantially all of our or their respective property or business;
101
Table of Contents
•dispose of property or, in the case of our subsidiaries, issue or sell any shares of such subsidiary’s capital stock;
•repay, prepay, redeem, purchase, retire or defease subordinated debt;
•declare or pay dividends or make certain other restricted payments;
•make certain investments;
•enter into transactions with affiliates;
•enter into new lines of business; and
•make certain amendments to our or their respective organizational documents or certain material contracts.
The Credit Agreement also contains certain financial covenants that require us to maintain (i) a minimum amount of Consolidated Adjusted EBITDA (as defined in the Credit Agreement) as of the last day of each fiscal quarter (which minimum amount increased through the fiscal quarter ended December 31, 2025) (the “Adjusted EBITDA Covenant”), and (ii) Liquidity (as defined in the Credit Agreement) of at least $20 million as of the last day of any calendar month.
We were in compliance with these covenants as of December 31, 2025.
The Credit Agreement also contains certain customary representations and warranties and affirmative covenants, and certain reporting obligations. In addition, the lenders under the Credit Facilities will be permitted to accelerate all outstanding borrowings and other obligations, terminate outstanding commitments and exercise other specified remedies upon the occurrence of certain events of default (subject to certain grace periods and exceptions), which include, among other things, payment defaults, breaches of representations and warranties, covenant defaults, certain cross-defaults and cross-accelerations to other indebtedness, certain events of bankruptcy and insolvency, certain judgments and Change of Control events (as defined in the Credit Agreement).
As of December 31, 2025, we had no balance outstanding under the Revolving Credit Facility and the total revolving commitment of $25.0 million remains available for future borrowings. As of December 31, 2025, we had approximately $29.0 million of borrowings outstanding under the Term Loan Facility.
Cash Flows
The following table summarizes our cash flows for the periods presented:
Year Ended December 31,
2025
2024
(in thousands)
Net cash provided by operating activities
$
14,541
$
12,233
Net cash provided by (used in) investing activities
9,050
(12,414)
Net cash used in financing activities
(29,651)
(3,534)
Effect of exchange rate changes on cash, cash equivalents and restricted cash
522
90
Net decrease in cash, cash equivalents, and restricted cash
(5,538)
(3,625)
Cash, cash equivalents, and restricted cash at beginning of period
33,159
36,784
Cash, cash equivalents and restricted cash at end of period
$
27,621
$
33,159
Operating Activities
Net cash flows provided by operating activities increased by $2.3 million for the year ended December 31, 2025, as compared to the year ended December 31, 2024.
Net cash provided by operating activities of $14.5 million for the year ended December 31, 2025, was primarily due to $12.1 million in incremental net loss, adjusted for non-cash charges of $31.3 million, and net cash of $4.7 million due to changes in our operating assets and liabilities.
102
Table of Contents
Non-cash charges primarily consisted of depreciation and amortization of $4.5 million, stock-based compensation expenses of $16.5 million and amortization of deferred contract acquisitions and fulfillment costs of $11.2 million, partially offset by non-cash interest income, net of $0.3 million and gain on foreign exchange of $0.5 million. The main drivers of net cash outflows that were derived from the changes in operating assets and liabilities were related to an increase in deferred contract acquisition costs of $5.1 million, an increase of $2.8 million in prepaid expenses and other current assets, a total decrease in employee accruals, accrued expenses, and other liabilities of $1.9 million, a decrease in deferred revenue of a $0.8 million, partially offset by a decrease in trade receivables of a $3.6 million, a net change in operating right-of-use asset and lease liability of $1.5 million and an increase in trade payables of $0.7 million.
Net cash provided by operating activities of $12.2 million for the year ended December 31, 2024, was primarily due to $31.3 million in incremental net loss, adjusted for non-cash charges of $41.6 million, and net cash of $2.1 million due to changes in our operating assets and liabilities. Non-cash charges primarily consisted of depreciation and amortization of $5.1 million, stock-based compensation expenses of $26.3 million and amortization of deferred contract acquisitions and fulfillment costs of $11.4 million. The main drivers of net cash inflows that were derived from the changes in operating assets and liabilities were related to an increase of $5.4 million in accrued expenses and other current liabilities, a decrease in trade receivables of $3.3 million, an increase of $2.7 million in employees and payroll accruals and an increase of $0.5 million in deferred revenue, partially offset by an increase in deferred contract acquisition costs of $7.5 million, an increase of $1 million in prepaid expenses and other current assets and a decrease in trade payables of $0.5 million.
Investing Activities
Net cash flows provided by investing activities increased by $21.5 million to $9.1 million for the year ended December 31, 2025 as compared to the year ended December 31, 2024.
Net cash provided by investing activities of $9.1 million for the year ended December 31, 2025 was related to maturities of available-for-sale marketable securities of $71.0 million, partially offset by investment in available-for-sale marketable securities of $54.1 million, payments for businesses acquired of $7.1 million and $0.7 million in capital expenditures.
Net cash used in investing activities of $12.4 million for the year ended December 31, 2024 was related to investment in available-for-sale marketable securities of $50.9 million and $0.5 million in capital expenditures, partially offset by maturities of available-for-sale marketable securities of $39.0 million.
Financing Activities
Net cash flows used in financing activities increased by $26.1 million for the year ended December 31, 2025 as compared to the year ended December 31, 2024.
Net cash used in financing activities of $29.7 million for the year ended December 31, 2025 was primarily due to repurchase of common stock of $26.2 million, $3.5 million of loan repayments, cash settlement of equity classified share-based payment awards of $3.1 million partially offset by proceeds from the exercise of stock options of $3.1 million.
Net cash used in financing activities of $3.5 million for the year ended December 31, 2024 was primarily due to repurchase of common stock of $2.9 million and $2.2 million of loan repayments partially offset by proceeds from the exercise of stock options of $1.6 million.
103
Table of Contents
Contractual Obligations and Commitments
The following table summarizes our contractual obligations and commitments as of December 31, 2025:
Payments Due by Period
(in thousands)
Less than 1 year
1-3 years
More than 3 years
Debt obligations 1
$
31,051
$
—
$
—
Operating lease obligations 2
3,490
8,451
7,637
Purchase obligations 3
30,466
1,862
—
Total
$
65,007
$
10,313
$
7,637
(1) Represents borrowings outstanding under our Term Loan Facility as of December 31, 2025, together with estimated interest payments thereon based on the interest rates in effect for such indebtedness as of December 31, 2025. See “—Liquidity and Capital Resources - Credit Facilities.”
(2) Represents the lease payments under our operating leases in the U.S. and Israel. The operating lease payments for our lease in Israel assume our exercise of the first extension option for an additional five years. See Note 8, Leases, to the audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K for additional information.
(3) Consists of minimum purchase commitments mainly for our use of certain cloud and other services with third-party providers with a term of 12 months or longer. Obligations under contracts that we can cancel without a significant penalty are not included in the table above.
We reported other liabilities of $17.7 million in our consolidated balance sheet at December 31, 2025, which principally consists of unrecognized tax benefits. See Note 12, Income Taxes, to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for further information. We have excluded these liabilities from the contractual obligations table above. A variety of factors could affect the timing of payments for the liabilities related to unrecognized tax benefits. Therefore, we cannot reasonably estimate the timing of such payments.
Critical Accounting Policies and Estimates
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Our management believes that the estimates, judgment and assumptions used are reasonable based upon information available at the time they are made. These estimates, judgments and assumptions can affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the consolidated financial statements, and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from those estimates.
We believe that the accounting policies described below require management’s most difficult, subjective or complex judgments. Judgments or uncertainties affecting the application of these policies may result in materially different amounts being reported under different conditions or using different assumptions. Accordingly, we believe these are the most critical to aid in fully understanding and evaluating our financial condition and results of operations. See Note 2, Significant Accounting Policies, to the audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K for additional information regarding these and our other significant accounting policies.
Revenue Recognition
Revenue is recognized when the customer obtains control of promised goods or services in an amount that reflects the consideration that we expect to receive in exchange for those goods or services. We apply judgment in identifying and evaluating terms and conditions in contracts that may impact revenue recognition. Contracts that contain multiple performance obligations require an allocation of the transaction price to each performance obligation based on a relative standalone selling price (“SSP”). When applicable, we allocate the transaction price between the separate performance obligations according to their SSP, which is based on the price at which the performance obligation is sold separately. If the SSP is not observable through past transactions, we estimate the SSP taking into account available information, including, but not limited to, pricing practices, market conditions, and the economic life of the software.
104
Table of Contents
Income Taxes
We are subject to income taxes in Israel, the U.S., and other foreign jurisdictions. Significant judgement is required in determining the provision for income taxes, including evaluating uncertainties in the application of accounting principles and complex tax laws. We recognize and measure benefits for uncertain tax positions using a two-step approach. The first step is to determine whether it is more likely than not that a tax position will be sustained upon examination, including the resolution of any related appeals or litigation based on the technical merits of that position. The second step is to measure a tax position that meets the more-likely-than-not threshold to determine the amount of benefit to be recognized in the financial statements. We evaluate uncertain tax positions on a quarterly basis, based upon a number of factors, including changes in facts or circumstances, changes in tax law, correspondence with tax authorities during the course of audits, and effective settlement of audit issues.
Recent Accounting Pronouncements
Please see Note 2, Significant Accounting Policies, to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for information regarding recent accounting pronouncements.
Jumpstart Our Business Startups Act of 2012
Under the JOBS Act, an “emerging growth company” can take advantage of an extended transition period for complying with new or revised accounting standards. This provision allows an “emerging growth company” to delay the adoption of new or revised accounting standards that have different transition dates for public and private companies until those standards would otherwise apply to private companies.
We meet the definition of an “emerging growth company” and have elected to use this extended transition period for complying with new or revised accounting standards until the earlier of the date we (x) are no longer an emerging growth company, or (y) affirmatively and irrevocably opt out of the extended transition period provided in the JOBS Act. As a result, our consolidated financial statements and the reported results of operations contained therein may not be directly comparable to those of other public companies. We expect to cease being an emerging growth company as of December 31, 2026.