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Weave Communications, Inc. (WEAV)

CIK: 0001609151. SIC: 7372 Services-Prepackaged Software. Latest 10-K as of: 2026-03-05.

SIC breadcrumb: Services > Business Services > SIC 7372 Services-Prepackaged Software

SEC company page: https://www.sec.gov/edgar/browse/?CIK=1609151. Latest filing source: 0001609151-26-000016.

Selected Fundamentals

MetricValueUnitFYFiled
Revenue239,024,000USD20252026-03-05
Net income-28,052,000USD20252026-03-05
Assets207,968,000USD20252026-03-05

Financials

Annual standardized facts from SEC companyfacts as of latest extracted filing date 2026-03-05. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001609151.json. Derived margins, ratios, and free cash flow are computed from the extracted annual SEC facts.

Flow metrics use full-year FY periods from 10-K/10-K/A filings; balance-sheet metrics use FY-end instants. Free cash flow = operating cash flow - capital expenditures. Missing metrics are omitted rather than fabricated.

Metric20182019202020212022202320242025
Revenue142,117,000170,468,000204,314,000239,024,000
Net income-32,060,000-40,421,000-51,690,000-49,738,000-31,031,000-28,346,000-28,052,000
Operating income-31,923,000-39,571,000-50,391,000-49,704,000-34,366,000-31,413,000-30,610,000
Gross profit27,226,00045,447,00066,499,00088,841,000116,091,000145,882,000172,308,000
Diluted EPS-3.30-3.75-2.60-0.76-0.46-0.40-0.37
Operating cash flow-22,069,000-15,518,000-20,373,000-12,766,00010,221,00014,149,00017,540,000
Capital expenditures2,469,0002,759,0007,376,0001,895,0001,691,0002,185,0002,389,000
Assets92,973,000187,485,000208,349,000201,012,000188,926,000207,968,000
Liabilities54,980,00075,184,000125,130,000122,055,000121,958,000125,584,000
Stockholders' equity-61,915,000-85,990,000-113,945,000112,301,00083,219,00078,957,00066,968,00082,384,000
Cash and cash equivalents55,698,000135,996,00061,997,00050,756,00051,596,00054,959,000
Free cash flow-24,538,000-18,277,000-27,749,000-14,661,0008,530,00011,964,00015,151,000

Ratios

ROE and ROA use period-end equity/assets. Liabilities / equity uses total liabilities divided by stockholders' equity. Current ratio uses current assets divided by current liabilities when both are reported.

Metric20182019202020212022202320242025
Net margin-35.00%-18.20%-13.87%-11.74%
Operating margin-34.97%-20.16%-15.37%-12.81%
Return on equity-46.03%-59.77%-39.30%-42.33%-34.05%
Return on assets-43.48%-27.57%-23.87%-15.44%-15.00%-13.49%
Liabilities / equity0.671.501.551.821.52
Current ratio1.542.841.841.781.581.24

Financial Charts

Quarterly

Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-05-05. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001609151.json.

Flow metrics use discrete quarter-length periods from 10-Q/10-Q/A filings. Q4 revenue and net income are derived only when annual FY and nine-month YTD facts exist for the same fiscal year; derived Q4 values are labeled. EPS Q4 is not derived.

QuarterEnd DateRevenueNet IncomeDiluted EPSMethod
2022-Q22022-06-30-0.23reported discrete quarter
2022-Q32022-09-30-0.18reported discrete quarter
2023-Q12023-03-3139,565,000-0.12reported discrete quarter
2023-Q22023-06-3041,667,000-8,988,000-0.13reported discrete quarter
2023-Q32023-09-3043,544,000-7,145,000-0.10reported discrete quarter
2023-Q42023-12-31-7,039,000derived Q4 = FY annual - nine-month YTD
2024-Q12024-03-3147,173,000-7,203,000-0.10reported discrete quarter
2024-Q22024-06-3050,586,000-8,553,000-0.12reported discrete quarter
2024-Q32024-09-3052,386,000-5,879,000-0.08reported discrete quarter
2024-Q42024-12-3154,169,000-6,711,000derived Q4 = FY annual - nine-month YTD
2025-Q12025-03-3155,809,000-8,825,000-0.12reported discrete quarter
2025-Q22025-06-3058,470,000-8,711,000-0.11reported discrete quarter
2025-Q32025-09-3061,342,000-8,668,000-0.11reported discrete quarter
2025-Q42025-12-3163,403,000-1,848,000derived Q4 = FY annual - nine-month YTD
2026-Q12026-03-3165,500,000-5,770,000-0.07reported discrete quarter

Quarterly Charts

Macro Cross-References

Latest quarter (10-Q)

Latest 10-Q source: 0001609151-26-000049.

Extracted structurally from real Item 2 body heading to real Item 3/4 boundary. Confidence: high. Filing date: 2026-05-05. Report date: 2026-03-31.

Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations

You should read the following discussion of our financial condition and results of operations in conjunction with the unaudited condensed consolidated financial statements and the notes thereto included elsewhere in this Quarterly Report on Form 10-Q. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Readers are cautioned that these forward-looking statements are subject to risks, uncertainties, and assumptions that are difficult to predict, including those identified below, under Part II, Item 1A. “Risk Factors,” and elsewhere herein. Therefore, our actual results could differ materially from those discussed in the forward-looking statements. We undertake no obligation to revise or update any forward-looking statements for any reason.

In this Quarterly Report on Form 10-Q, unless otherwise specified or the context otherwise requires, “Weave,” the “Company,” “we,” “us,” and “our” refer to Weave Communications, Inc. and its consolidated subsidiaries.

Overview

Weave is a vertical Software-as-a-Service (“SaaS”) platform that delivers AI-powered patient engagement solutions for small and medium-sized (“SMB”) healthcare practices. Our platform is designed to help the practices manage the complete patient lifecycle by automating administrative patient-facing workflows across pre-care, clinical, and post-care operations. Recognizing that most of these workflows originate from or terminate through a phone call or message, we believe we have significant operational advantage by owning the full telephony and communication stack.

We have embedded AI technology into the platform to function as an "always-on teammate" for practice staff, autonomously fulfilling daily tasks. By leveraging this always-on teammate to handle repetitive duties like answering routine questions, scheduling appointments, and managing payment processing, these solutions reduce front-office interruptions and allow clinical staff to focus on face-to-face patient care

Our platform ensures seamless patient care by unifying conversational context across voice and text channels into a single inbox, blending AI agents and staff actions. The platform is built on nearly two decades of domain expertise and billions of patient interactions, allowing us to leverage our vertically specialized data to deliver high-accuracy automation within strict privacy and regulatory frameworks.

We continue to focus on reducing administrative burdens for healthcare practices through agentic AI, embedded automation and real-time operational insights.

Supplemental Financial Information — Disaggregated Revenue and Cost of Revenue

To supplement our discussion of our consolidated results of operations, we have separated our revenue and cost of revenue into recurring and customer onboarding categories to disaggregate revenue and costs of revenue that are one-time in nature from those that are term-based and renewable.

We generate revenue primarily from recurring subscription fees charged to access our platform, which also includes embedded lease revenue on phone hardware. These recurring revenues accounted for 90% and 91% of our revenue the three months ended March 31, 2026 and 2025, respectively. In addition, we provide recurring payment processing services through Weave Payments and derive revenue from transactions between our customers that utilize Weave Payments and their end consumers.

We also derive revenue associated with installation fees for onboarding customers. We utilize our onboarding services and phone hardware as customer acquisition tools and price them competitively to lower the barriers to entry for new customers adopting our platform. As a result, the variable cost associated with providing phone hardware and onboarding assistance has historically exceeded the related revenue, resulting in negative gross profit for each. The revenue and related costs associated with onboarding new customers are primarily associated with the initial setup of a customer’s software and

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phone system. Revenue on phone hardware provided to our customers, deemed embedded lease revenue, is recognized over the related subscription period. The associated costs, which primarily represent depreciation expense on phone hardware financed under finance lease arrangements, are incurred over the useful lives of the phone hardware, which is 36 months. We consider the net costs of onboarding and phone hardware, in addition to our sales and marketing activities, to be core elements of our customer acquisition approach.

The table below sets forth the revenue and associated cost of revenue for our recurring subscription and payment processing services, as well as for our onboarding services and phone hardware:

Three Months Ended March 31,

2026

2025

(dollars in thousands)

Subscription and payment processing:

Revenue

$

62,562 

$

53,415 

Cost of revenue

(13,515)

(12,081)

Gross profit

$

49,047 

$

41,334 

Gross margin

78 

%

77 

%

Onboarding:

Revenue

$

932 

$

888 

Cost of revenue

(2,574)

(1,992)

Gross profit

$

(1,642)

$

(1,104)

Gross margin

(176)

%

(124)

%

Phone Hardware:

Revenue

$

2,006 

$

1,506 

Cost of revenue(1)

(1,872)

(1,791)

Gross profit

$

134 

$

(285)

Gross margin

7 

%

(19)

%

______________

(1) Cost of revenue related to phone hardware represents depreciation of phone hardware over a 3-year useful life

Factors Affecting Our Performance

Our historical financial performance has been, and we expect our financial performance in the future to be, driven by our ability to attract new customers, retain and expand within our customer base, add new products, and expand into new industry verticals.

Attract New Customers

Our ability to attract new customers is dependent upon a number of factors, including the effectiveness of our pricing and products, the sum total of the features and pricing of the alternative point solution patchwork, the effectiveness of our marketing efforts, the effectiveness of our channel partners in selling and marketing our platform, our ability to integrate our platform with practice management systems (“PMS”) and EHR software, which strengthens our product market fit and increases the value our platform provides to customers, and the growth of the market for a customer experience and payments software platform. Sustaining our growth requires continued adoption of our platform by new customers. We aim to add new customers through a combination of unpaid channels, such as recommendations and word of mouth, and paid channels, such as digital marketing, direct mail, trade shows and industry events, brand marketing and our teams of sales representatives. Historically, our go-to-market strategy focused on increasing the number of locations with most of our customers having a single location.

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In addition to pursuing continued customer growth among small businesses, we pursue opportunities to expand our customer base among medium-sized businesses through sales of Weave Enterprise, which is designed for multi-location businesses, with a particular focus on our core specialty healthcare verticals. Our ability to expand among medium-sized businesses will depend upon our ability to successfully sell our enhanced Weave platform to multi-location organizations and effectively retain them.

Retain and Expand Within Our Customer Base

Our ability to retain and increase revenue within our existing customer base is dependent upon a number of factors, including customer satisfaction with our platform and support, the sum total of the features and pricing of the alternative point solution patchwork, our ability to effectively enhance our platform by developing new applications and features and addressing additional use cases, and our ability to leverage and scale our core sales efforts and marketing capabilities to increase our penetration into our core specialty healthcare verticals. The deployment of the Weave phone system as part of the platform at each of our customers’ locations improves retention and customer loyalty. Historically, our subscriptions have provided our new customers with immediate access to the majority of our products and functionality. However, we have released additional add-on products in recent years, such as Bulk Texting, Forms, Insurance Verification and Call Intelligence, which we are increasingly successful at cross-selling to our customer base. We intend to continue to invest in enhancing awareness of our platform, creating additional use cases, and developing more products, features and functionality.

Customer retention also impacts our future financial performance given its potential to drive improved gross margin. The initial onboarding costs, as well as the cost of phone hardware, which is depreciated over three years, represent substantial cost of revenue elements during the first few years of a customer’s life. We believe our disaggregated revenue and cost of revenue financial data, particularly our subscription and payment processing gross margin, provide insight into the impact of customer retention on overall gross margin improvement. Our subscription and payment processing gross margin was 78% and 77% for the three months ended March 31, 2026 and 2025 respectively.

Add New Products

We continue to add new products and functionality to our platform, broadening our use cases and applicability for different customers. In 2025, among other new products, we introduced our AI receptionist, powered by TrueLark, which automatically follows up missed calls with a fully interactive, AI-powered texting conversation and lets patients book appointments over text or from the practice’s website, any time of day. We also delivered Weave Insurance Eligibility, which links directly to multiple dental insurance portals to retrieve detailed patient insurance information to provide patients a more complete view of their insurance coverage.

We expect our future success in winning new clients to be partially driven by our ability to continue to develop and deliver new, innovative products in a timely manner, including those enabled by AI. The depth of our platform’s functionality is dependent upon both our internally-developed or acquired technology and our product partnerships and integrations.

Expand to New Industry Verticals

We believe we have built a flexible platform that encompasses the majority of the functionality needed for customer experience and engagement across industry verticals, and we have developed a repeatable playbook for assessing new industry verticals. We started in dental and have since successfully expanded to optometry and veterinary. Most recently, we entered the specialty medical industry vertical, which has quickly grown to be our second largest industry vertical by location count and remains our fastest growing. Entering a new industry vertical includes evaluating product-market fit and establishing key integration partnerships with the primary systems of record in that vertical. While we are focused on continued growth within our core specialty healthcare verticals and adjacent healthcare markets, we continue to evaluate additional expansion opportunities.

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Key Business Metrics

In addition to our financial information that is presented in accordance with the generally accepted accounting principles in the U.S. (“U.S. GAAP”), we review several operating and financial metrics, including the following key metrics to evaluate our business, measure our performance, identify trends affecting our business, formulate business plans and make strategic decisions. These metrics exclude the impact of the May 2025 TrueLark acquisition as the relevant inputs to the calculation require trailing twelve months of data to calcula

[Excerpt truncated for page length; source filing is linked above.]

Latest 10-K MD&A

Extracted structurally from real Item 7 body heading to real Item 7A/8 boundary. Confidence: high. Filing date: 2026-03-05. Report date: 2025-12-31.

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

You should read the following discussion of our financial condition and results of operations in conjunction with the consolidated financial statements and the notes thereto included elsewhere in this Annual Report on Form 10-K. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Readers are cautioned that these forward-looking statements are subject to risks, uncertainties, and assumptions that are difficult to predict, including those identified above, under “Part I, Item 1A. Risk Factors,” and elsewhere herein. Therefore, our actual results could differ materially from those discussed in the forward-looking statements. We undertake no obligation to revise or update any forward-looking statements for any reason.

In this Annual Report on Form 10-K, unless otherwise specified or the context otherwise requires, “Weave,” the “Company,” “we,” “us,” and “our” refer to Weave Communications, Inc. and its consolidated subsidiaries.

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We have elected to omit discussion of the earliest of the three years presented in the Consolidated Financial Statements of this Annual Report on Form 10-K. Refer to “Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the year ended December 31, 2024, which was filed with the U.S. Securities and Exchange Commission (“SEC”) on March 13, 2025, for year-over-year comparisons of the results of operation between the year ended December 31, 2024 and December 31, 2023 as well as a discussion of 2023 performance metrics and cash flow activity, all of which are incorporated herein by reference.

Overview

Weave is a leading AI-powered patient communications, engagement, and payments platform purpose-built for small and medium-sized (“SMB”) healthcare practices. We strive to elevate patient experiences through a unified platform that improves business operations, allowing healthcare professionals to focus on what matters most: patient care.

Weave serves as the orchestration layer for modern healthcare practices, bringing together voice, text, and AI-powered workflows into a single system of work. Our platform is built on nearly two decades of domain expertise and billions of patient interactions, allowing us to leverage our vertically specialized data to deliver high-accuracy automation within strict privacy and regulatory frameworks.

We deliver powerful communication and engagement capabilities previously only available to enterprises, made them intuitive and easy to use and put them in one solution. Our verticalized software platform helps streamline the day-to-day operations of running an SMB healthcare practice.

Supplemental Financial Information — Disaggregated Revenue and Cost of Revenue

To supplement our discussion of our consolidated results of operations, we have separated our revenue and cost of revenue into recurring and onboarding categories to disaggregate revenue and costs of revenue that are one-time in nature from those that are term-based and renewable.

We generate revenue primarily from recurring subscription fees charged to access our platform, which also includes embedded lease revenue on phone hardware. These recurring revenues accounted for 91% and 92% of our revenue for each of the years ended December 31, 2025 and 2024, respectively. In addition, we provide recurring payment processing services through Weave Payments and derive revenue from transactions between our customers that utilize Weave Payments and their end consumers.

We also derive revenue associated with installation fees for onboarding customers. We utilize our onboarding services and phone hardware as customer acquisition tools and price them competitively to lower the barriers to entry for new customers adopting our platform. As a result, the variable cost associated with providing phone hardware and onboarding assistance has historically exceeded the related revenue, resulting in negative gross profit for each. The revenue and related costs associated with onboarding new customers are primarily associated with the initial setup of a customer’s software and phone system. Revenue on phone hardware provided to our customers, deemed embedded lease revenue, is recognized over the related subscription period. The associated costs, which primarily represent depreciation expense on phone hardware financed under finance lease arrangements, are incurred over the useful lives of the phone hardware, which is 36 months. We consider the net costs of onboarding and phone hardware, in addition to our sales and marketing activities, to be core elements of our customer acquisition approach.

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The table below sets forth the revenue and associated cost of revenue for our recurring subscription and payment processing services, as well as for our onboarding services and phone hardware:

Year Ended December 31,

2025

2024

(dollars in thousands)

Subscription and payment processing:

Revenue

$

228,769 

$

196,106 

Cost of revenue

(50,583)

(43,567)

Gross profit

$

178,186 

$

152,539 

Gross margin

78 

%

78 

%

Onboarding:

Revenue

$

3,463 

$

3,547 

Cost of revenue

(8,757)

(7,793)

Gross profit

$

(5,294)

$

(4,246)

Gross margin

(153)

%

(120)

%

Phone Hardware:

Revenue

$

6,792 

$

4,661 

Cost of revenue(1)

(7,376)

(7,072)

Gross profit

$

(584)

$

(2,411)

Gross margin

(9)

%

(52)

%

______________

(1)    Cost of revenue related to hardware represents depreciation of phone hardware over a 3-year useful life.

Factors Affecting Our Performance

Our historical financial performance has been, and we expect our financial performance in the future to be, driven by our ability to attract new customers, retain and expand within our customer base, add new products, and expand into new industry verticals.

Attract New Customers

Our ability to attract new customers is dependent upon a number of factors, including the effectiveness of our pricing and products, the sum total of the features and pricing of the alternative point solution patchwork, the effectiveness of our marketing efforts, the effectiveness of our channel partners in selling and marketing our platform, our ability to integrate our platform with PMS and EHR software, which strengthens our product market fit and increases the value our platform provides to customers, and the growth of the market for a customer experience and payments software platform. Sustaining our growth requires continued adoption of our platform by new customers. We aim to add new customers through a combination of unpaid channels, such as recommendations and word of mouth, and paid channels, such as digital marketing, direct mail, trade shows and industry events, brand marketing and our teams of sales representatives. Historically, our go-to-market strategy focused on increasing the number of locations with most of our customers having a single location.

In addition to pursuing continued customer growth among small businesses, we intend to pursue opportunities to expand our customer base among medium-sized businesses through sales of Weave Enterprise, which is designed for multi-location businesses, with a particular focus on our core specialty healthcare verticals. Our ability to expand among medium-sized businesses will depend upon our ability to successfully sell our enhanced Weave platform to multi-location organizations, and effectively retain them.

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Retain and Expand Within Our Customer Base

Our ability to retain and increase revenue within our existing customer base is dependent upon a number of factors, including customer satisfaction with our platform and support, the sum total of the features and pricing of the alternative point solution patchwork, our ability to effectively enhance our platform by developing new applications and features and addressing additional use cases, and our ability to leverage and scale our core sales efforts and marketing capabilities to increase our penetration into our core specialty healthcare verticals. The deployment of the Weave phone system as part of the platform at each of our customers’ locations improves retention and customer loyalty. Historically, our subscriptions have provided our new customers with immediate access to the majority of our products and functionality. However, we have released additional add-on products in recent years, such as Bulk Texting, Forms, Insurance Verification and Call Intelligence, which we are increasingly successful at cross-selling to our customer base. We intend to continue to invest in enhancing awareness of our platform, creating additional use cases, and developing more products, features and functionality.

Customer retention also impacts our future financial performance given its potential to drive improved gross margin. The initial onboarding costs as well as the cost of phone hardware, which is depreciated over three years, represent substantial cost of revenue elements during the first few years of a customer’s life. We believe our disaggregated revenue and cost of revenue financial data, particularly our subscription and payment processing gross margin, provide insight into the impact of customer retention on overall gross margin improvement. Our subscription and payment processing gross margin was 78% for each of the years ended December 31, 2025 and 2024.

Add New Products

We continue to add new products and functionality to our platform, broadening our use cases and applicability for different customers. In 2025, among other new products, we introduced our AI-receptionist, powered by TrueLark, which automatically follows up on missed calls with a fully interactive AI-powered texting conversation and lets patients book appointments over text or from the practice's website, any time of day. We also delivered Weave Insurance Eligibility, which links directly to multiple dental insurance portals to retrieve detailed patient insurance information which provides a more complete view of a patient’s insurance coverage.

We expect our future success in winning new clients to be partially driven by our ability to continue to develop and deliver new, innovative products in a timely manner, including those enabled by AI. The depth of our platform’s functionality is dependent upon both our internally-developed technology and our product partnerships and integrations.

Expand to New Industry Verticals

We believe we have built a flexible platform that encompasses the majority of the functionality needed for customer experience and engagement across industry verticals, and we have developed a repeatable playbook for assessing new industry verticals. We started in dental and have since successfully expanded to optometry, and veterinary. Most recently, we entered the specialty medical vertical, which has quickly grown to be our second largest vertical by location count and remains our fastest growing. Entering a new industry vertical includes evaluating product-market fit and establishing key integration partnerships with the primary systems of record in that vertical. While we are focused on continued growth within our core specialty healthcare verticals and adjacent healthcare markets, we continue to evaluate additional expansion opportunities.

Key Business Metrics

In addition to our financial information that is presented in accordance with the generally accepted accounting principles in the U.S. (“U.S. GAAP”), we review several operating and financial metrics, including the following key metrics to evaluate our business, measure our performance, identify trends affecting our business, formulate business plans and make strategic decisions. Number of locations in the

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table below includes the impact of the acquisition of TrueLark in May 2025. Dollar-based net retention rate and dollar-based gross retention rate exclude the impact of the acquisition of TrueLark as the relevant inputs to the calculation require trailing twelve months of data to calculate.

December 31,

2025

2024

Number of locations (at period end)

39,625 

34,997 

Dollar-based net retention rate

93 

%

98 

%

Dollar-based gross retention rate

89 

%

91 

%

Number of Customer Locations

We believe the number of customer locations for each year provides us an indicator of our market penetration, the growth of our business and our potential future business opportunities. We measure locations as the total number of customer locations under active subscription with Weave and its wholly-owned subsidiaries as of the end of each reporting period. A single organization or customer with multiple divisions, segments, offices or subsidiaries is counted as multiple locations if they have entered into subscription agreements for each location.

Dollar-Based Net Revenue Retention Rate

We believe our dollar-based net revenue retention rate (“NRR”) provides insight into our ability to retain and grow revenue from our customer locations, as well as their potential long-term value to us. For retention rate calculations, we use adjusted monthly revenue (“AMR”), which is calculated for each location as the sum of (i) the subscription component of revenue for each month and (ii) the average of the trailing-three-month recurring payments revenue. Since payments revenue represents the revenue we recognize on payment processing volume, which is reported net of transaction processing fees, we believe the three-month average appropriately adjusts for short-term fluctuations in transaction volume. To calculate our NRR, we first identify the cohort of locations, or the Base Locations, that were active in a particular month, or the Base Month. We then divide AMR for the Base Locations in the same month of the subsequent year, or the Comparison Month, by AMR in the Base Month to derive a monthly NRR. AMR in the Comparison Month includes the impact of any churn, revenue contraction, revenue expansion, and pricing changes, and by definition does not include any new customer locations under subscription added between the Base Month and Comparison Month. We derive our annual NRR as of any date by taking a weighted average of the monthly net retention rates over the trailing twelve months prior to such date.

Dollar-Based Gross Revenue Retention Rate

We believe our dollar-based gross revenue retention rate (“GRR”) provides insight into our ability to retain our customers, allowing us to evaluate whether the platform is addressing customer needs. To calculate our GRR, we first identify the Base Locations that were under subscription in the Base Month. We then calculate the effect of reductions in revenue from customer location terminations by measuring the amount of AMR in the Base Month for Base Locations still under subscription twelve months subsequent to the Base Month, or Remaining AMR. We then divide the Remaining AMR for the Base Locations by AMR in the Base Month for the Base Locations to derive a monthly gross revenue retention rate. We calculate GRR as of any date by taking a weighted average of the monthly gross revenue retention rates over the trailing twelve months prior to such date. GRR reflects the effect of customer locations that terminate their subscriptions, but does not reflect changes in revenue due to revenue expansion, revenue contraction, or the addition of new customer locations.

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Components of Results of Operations

Revenue

We generate revenue primarily from recurring subscription fees charged to access our software and phone services platform, and recurring embedded lease revenue on phone hardware provided to customers. The majority of these subscription arrangements have contractual month-to-month terms, with a small minority portion having contractual terms of 1-3 years. Subscription and phone hardware fees are prepaid and customers may elect to be billed monthly or annually, with the majority of our revenue coming from those that elect to be billed monthly. To incentivize annual payments, we may offer pricing concessions that apply ratably over the twelve-month subscription plan. As of December 31, 2025 and 2024, approximately 27% and 34% of customer locations elected annual prepayments, respectively. Subscription revenue is recognized ratably over the term of the subscription agreement. Amounts billed in excess of revenue recognized are reported in deferred revenue on the Company’s consolidated balance sheets.

In addition, we provide payment processing services and receive a revenue share from a third-party payment facilitator on transactions between our customers that utilize our payments platform and their end consumers. These payment transactions are generally for services rendered at customers’ business location via credit card terminals or through several card-not-present modalities, including “Text-to-Pay” functionality. Revenue from payments services is recorded net of transaction processing fees and is recognized when the payment transactions occur.

We also collect installation fees for onboarding customers, the revenue for which is recognized upon completion of the installation. Our customers may directly engage with third-party independent contractors to configure phone hardware, install the software and assist with upgrades, for which we do not derive any revenue.

Cost of Revenue

Cost of revenue consists of costs related to providing our platform to customers and costs to support our customers. Direct costs associated with providing our platform include data center and cloud infrastructure costs, payment processing costs, amortization of finance lease right-of-use assets on phone hardware provided to customers, fees and revenue shares to application providers, voice connectivity and messaging fees, and amortization of internal-use software development costs and acquired technology. Indirect costs include personnel-related expenses, such as salaries, benefits, bonuses and stock-based compensation expense, of our onboarding and customer support staff. Cost of revenue also includes an allocation of overhead costs for facilities and shared IT-related expenses, including depreciation expense. Our acquired technology is measured at its estimated fair value and is amortized over its estimated useful life, which is five years.

As we acquire new customers and existing customers increase their use of our cloud-based platform, we expect that the dollar amount of our cost of revenue will continue to increase. However, our cost of revenue has been and will continue to be affected by a number of factors, including increased regulatory fees on text messaging and phone calls, the quantity and aging of phones provided to customers, changes to fees paid to application providers, adoption of AI-based features, future changes to the cloud infrastructure costs to support AI-based features, our stock-based compensation expense, and the timing of the amortization of internal-use software development costs, which could cause it to fluctuate as a percentage of revenue in future periods.

Operating Expenses

Our operating expenses consist of sales and marketing, research and development, and general and administrative expenses. Personnel costs are the most significant component of operating expenses and consist of salaries, benefits, bonuses, stock-based compensation and sales commissions. Operating

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expenses also include allocated overhead costs for facilities and shared IT-related expenses, including depreciation expense.

Sales and Marketing

Sales and marketing expenses consist primarily of personnel-related expenses associated with our sales and marketing staff, including salaries, benefits, sales commissions, bonuses and stock-based compensation. Sales commissions paid on new subscriptions to our software, phone, and payments services are deferred and amortized over the expected period of benefit, which is determined to be three years. In addition to personnel-related expenses, marketing expenses consist of lead-generating and other advertising activities, as well as the cost of traveling to and attending trade shows. Sales and marketing expenses also include acquisition-related amortization expenses. Our acquired customer relationships and trademarks and trade names are measured at their fair values and are amortized over their estimated useful lives, which are seven years.

We expect that our sales and marketing expenses will continue to increase and continue to be our largest operating expense for the foreseeable future as we grow our business. Although the expenses as a percentage of revenue may fluctuate from period to period, we expect these expenses to decrease as a percentage of revenue over time.

Research and Development

Research and development expenses include software development costs that are not eligible for capitalization and support our efforts to ensure the reliability, availability and scalability of our solutions. Our platform is software-driven, and its research and development teams employ software engineers in the continuous testing, certification and support of our platform and products. Accordingly, the majority of our research and development expenses result from employee-related costs, including salaries, benefits, bonuses, and stock-based compensation, and costs associated with technology tools used by our engineers.

We expect that our research and development expenses will increase as our business grows, particularly as we incur additional costs related to continued investments in our platform and products. However, we expect that our research and development expenses will remain relatively consistent as a percentage of our revenue over time, although there may be fluctuations from period to period. In addition, research and development expenses that qualify as internal-use software development costs are capitalized and the amount capitalized may fluctuate significantly from period to period.

General and Administrative

General and administrative expenses consist primarily of personnel-related expenses for our finance, legal, human resources, facilities and administrative personnel, including salaries, benefits, bonuses, and stock-based compensation. General and administrative expenses also include external legal, accounting, and other professional services fees, software and subscription services dedicated for use by our general and administrative functions, insurance and other corporate expenses, such as acquisition transaction costs.

We expect that our general and administrative expenses, including expenses for insurance, investor relations and fees for professional services, will increase in absolute dollars as our business grows but will decrease as a percentage of our revenue over time.

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Interest Income

Interest income consists primarily of interest earned on our cash, cash equivalents, and short-term investments.

Interest Expense    

Interest expense results primarily from administrative fees associated with our revolving line of credit and interest on finance lease obligations. Interest on our revolving line of credit is based on a floating per annum rate at the greater of prime rate less 0.25% or 3.50%. Interest on finance leases is based on the leases’ readily determinable rate implicit within the lease agreement. For those leases which do not provide a readily determinable implicit rate, the Company estimates the incremental borrowing rate.

Other Income (Expense), Net

Other income (expense), net primarily consists of gains and losses on short-term investments, foreign currency transactions, and sublease income.

Provision for Income Taxes

Provision for (benefit from) income taxes consists primarily of income taxes related to foreign and state jurisdictions in which we conduct business. Historically, our U.S. operations have generated taxable losses, and as a result we maintain a valuation allowance against our domestic net deferred tax assets, including net operating loss carryforwards. During the year ended December 31, 2025, we recorded a partial release of valuation allowance related to deferred tax liabilities recognized in connection with the Vidurama acquisition. Notwithstanding this release, we continue to maintain a valuation allowance against our remaining domestic deferred tax assets.

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Results of Operations

The following table sets forth our consolidated statements of operations data for the periods indicated:

Year Ended December 31,

2025

2024

(in thousands)

Revenue

$

239,024 

$

204,314 

Cost of revenue(1)(3)

66,716 

58,432 

Gross profit

172,308 

145,882 

Operating expenses:

Sales and marketing(1)(2)(3)

102,703 

84,612 

Research and development(1)(2)

44,462 

40,231 

General and administrative(1)(2)

55,753 

52,452 

Total operating expenses

202,918 

177,295 

Loss from operations

(30,610)

(31,413)

Other income (expense):

Interest income

1,811 

1,851 

Interest expense

(1,700)

(1,523)

Other income (expense), net

1,523 

2,928 

Loss before income taxes

(28,976)

(28,157)

Income tax benefit (provision)

924 

(189)

Net loss

$

(28,052)

$

(28,346)

______________

(1)Includes stock-based compensation expense as shown below

(2)Includes acquisition transaction costs as shown below

(3)Includes amortization of acquisition-related intangibles as shown below

Year Ended December 31,

2025

2024

(in thousands)

Cost of revenue

$

894 

$

1,014 

Sales and marketing

7,510 

6,582 

Research and development

8,806 

8,374 

General and administrative

14,921 

16,250 

Total stock-based compensation

$

32,131 

$

32,220 

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See Note 14 to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for further details on stock-based compensation expense.

Year Ended December 31,

2025

2024

(in thousands)

Sales and marketing

16 

— 

Research and development

116 

— 

General and administrative

1,564 

— 

Total acquisition transaction costs

$

1,696 

$

— 

Year Ended December 31,

2025

2024

(in thousands)

Cost of revenue

535 

— 

Sales and marketing

331 

— 

Total amortization of acquisition-related intangibles

$

866 

$

— 

See Note 4 to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for further details on amortization of acquisition related intangibles.

The following table sets forth our consolidated statements of operations data expressed as a percentage of revenue for the periods indicated:

Year Ended December 31,

2025

2024

(percentage of total revenue)

Revenue

100 

%

100 

%

Cost of revenue

28 

29 

Gross margin

72 

71 

Operating expenses:

Sales and marketing

43 

41 

Research and development

19 

20 

General and administrative

23 

26 

Total operating expenses

85 

87 

Loss from operations

(13)

(16)

Other income (expense):

Interest income

1 

1 

Interest expense

(1)

(1)

Other income (expense), net

1 

1 

Loss before income taxes

(12)

(15)

Income tax benefit (provision)

— 

— 

Net loss

(12)

%

(15)

%

Comparison of the Years Ended December 31, 2025 and December 31, 2024

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Revenue

Year Ended December 31,

Change

2025

2024

Amount

Percentage

(dollars in thousands)

Revenue

$

239,024 

$

204,314 

$

34,710 

17 

%

Revenue increased by $34.7 million, or 17%, for the year ended December 31, 2025 compared to the year ended December 31, 2024. Approximately $23.9 million, or 69% of our revenue growth was attributable to revenue generated from new customer locations acquired during the year ended December 31, 2025, and $10.8 million, or 31% of the increase was attributable to revenue generated from existing customer locations under subscription as of December 31, 2024. Customer locations totaled 39,625 and 34,997 as of December 31, 2025 and 2024, respectively.

Cost of Revenue and Gross Margin

Year Ended December 31,

Change

2025

2024

Amount

Percentage

(dollars in thousands)

Cost of revenue

$

66,716 

$

58,432 

$

8,284 

14 

%

Gross margin

72 

%

71 

%

The increase in cost of revenue was due primarily to an increase of $5.5 million in direct costs to support customer usage and growth of our customer base, including cloud infrastructure costs, fees paid to application providers, and connectivity and messaging costs. In addition, there was an increase of $2.0 million in personnel-related costs, particularly related to merit increases and new hires, and an increase of $0.8 million in allocated overhead costs.

Our gross margin improvement is derived from a favorable customer mix as a greater portion of our customers had fully depreciated phone hardware, increasing contribution from payments revenue, and from efficiencies with third-party costs incurred for specific platform features and overall data usage as part of our cost management efforts.

Sales and Marketing

Year Ended December 31,

Change

2025

2024

Amount

Percentage

(dollars in thousands)

Sales and marketing

$

102,703 

$

84,612 

$

18,091 

21 

%

The increase in sales and marketing expenses was primarily attributable to an increase of $9.3 million in personnel-related expenses, including increases in stock-based compensation, commission, and bonus incentives, largely due to an increases in headcount, merit increases and increases in commissionable sales. In addition demand generation expenses increased by $6.7 million, driven largely by our digital media, brand advocacy and affiliate marketing efforts. We also incurred $0.8 million in additional event-related costs due to increased in-person trade show attendance, and $1.3 million in allocated overhead costs.

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Research and Development

Year Ended December 31,

Change

2025

2024

Amount

Percentage

(dollars in thousands)

Research and development

$

44,462 

$

40,231 

$

4,231 

11 

%

The increase in research and development expenses was due to an increase of $5.0 million in personnel-related expenses, largely from salary adjustments and stock-based compensation related to grants for the new and existing employees enhancing our platform infrastructure and developing new product offerings, and an increase of $0.4 million in allocated overhead costs. The overall increase to research and development expenses was partially offset by the capitalization of approximately $1.2 million of incremental internal-use software costs.

General and Administrative

Year Ended December 31,

Change

2025

2024

Amount

Percentage

(dollars in thousands)

General and administrative

$

55,753 

$

52,452 

$

3,301 

6 

%

The increase in general and administrative expenses was primarily due to a $1.7 million increase in professional services fees, with approximately $1.5 million of this increase attributable to one-time costs associated with the acquisition of TrueLark. We also incurred a $0.6 million increase in personnel-related expenses that was driven by a $1.9 million increase in salaries, wages and bonuses, offset by a decrease of $1.3 million in stock-based compensation expense primarily related to the forfeiture of certain stock-based awards, and an increase of $0.3 million in allocated overhead costs. The overall increase to general and administrative expenses also includes a $0.7 million decrease of capitalized costs due to personnel-related implementation costs incurred in cloud computing arrangements that are service contracts.

Other Income (Expense), Net

Year Ended December 31,

Change

2025

2024

Amount

Percentage

(dollars in thousands)

Interest income

$

1,811 

$

1,851 

Interest expense

(1,700)

(1,523)

Other income, net

1,523 

2,928 

Total other income (expense), net

$

1,634 

$

3,256 

$

(1,622)

(50)

%

The decrease in other income (expense), net is largely due to decreased realized gains on our short-term investments due to a lower average daily balance over the period, as a result of assets used to fund the TrueLark acquisition and, to a lesser extent, increased fees on our revolving line of credit, and a decrease in average interest rates over the period.

Benefit (Provision) for Income Taxes

Year Ended December 31,

Change

2025

2024

Amount

Percentage

(dollars in thousands)

Income tax benefit (provision)

$

924 

$

(189)

$

1,113 

589 

%

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We recorded an income tax benefit of $0.9 million in 2025 compared to income tax expense of $0.2 million in 2024, primarily due to deferred tax impacts and valuation allowance changes, including acquisition-related deferred tax liabilities. Foreign tax expense remained relatively consistent year-over-year and continues to be driven primarily by our India operations.

Non-GAAP Financial Measures

To supplement our consolidated financial statements, which are prepared in conformity with U.S. GAAP, we use free cash flow, free cash flow margin and adjusted earnings before interest, taxes, depreciation, and amortization (“Adjusted EBITDA”), which are non-GAAP financial measures, to enhance the understanding of our U.S. GAAP financial measures, evaluate growth trends, establish budgets, and assess operating performance. These non-GAAP financial measures should not be considered by the reader as substitutes for, or superior to, the consolidated financial statements and financial information prepared in accordance with U.S. GAAP. See below for a description of these non-GAAP financial measures, reconciliations of these non-GAAP financial measures to their most directly comparable U.S. GAAP financial measures and their limitations as an analytical tool.

Year Ended December 31,

2025

2024

(dollars in thousands)

Net cash provided by operating activities

$

17,540 

$

14,149 

Net cash provided by (used in) investing activities

$

(6,846)

$

8,882 

Net cash used in financing activities

$

(7,331)

$

(22,191)

Free cash flow

$

12,860 

$

10,364 

Net cash provided by operating activities as a percentage of revenue

7 

%

7 

%

Free cash flow margin

5 

%

5 

%

Net loss

$

(28,052)

$

(28,346)

Adjusted EBITDA

$

8,055 

$

4,538 

Free Cash Flow and Free Cash Flow Margin

We define free cash flow as net cash provided by operating activities, less purchases of property and equipment and capitalized internal-use software costs, and free cash flow margin as free cash flow as a percentage of revenue. We believe that free cash flow and free cash flow margin are useful indicators of liquidity that provide useful information to management and investors, as they provide information about the amount of cash consumed by our combined operating and investing activities. For example, as free cash flow has in the past been negative, we have needed to access cash reserves or other sources of capital for these investments.

Adjusted EBITDA

We define EBITDA as earnings before interest expense, interest income, other income/expense, income tax benefit (expense), depreciation, and amortization. Our depreciation adjustment includes depreciation on operating fixed assets and we do not adjust for amortization of finance lease right-of-use assets on phone hardware provided to our customers. Our amortization adjustment includes the amortization of capitalized costs from both internal-use software development and cloud computing arrangements. We further adjust EBITDA to exclude stock-based compensation expense, a non-cash item, acquisition transaction costs, which we believe are not reflective of ongoing results of operations in the period incurred and not directly related to the operation of our business, and amortization of acquisition-related intangible assets. Although we exclude the amortization of acquisition-related intangible assets from the non-GAAP measure, management believes it is important for investors to understand that such intangible assets were recorded as part of purchase accounting and contribute to revenue generation. We believe that Adjusted EBITDA provides management and investors consistency and comparability with our past financial performance and facilitates period-to-period comparisons of

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operations. Additionally, management uses Adjusted EBITDA to measure our financial and operational performance and prepare our budgets. A financial covenant under our revolving line of credit with SVB uses a different but similar measure of EBITDA, as adjusted for stock-based compensation expense and changes in its deferred revenue balances, which we refer to as Adjusted EBITDA in Note 13 of our consolidated financial statements.

Limitations and Reconciliation of Non-GAAP Financial Measures

Non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as substitutes for financial information presented under U.S. GAAP. There are a number of limitations related to the use of non-GAAP financial measures versus comparable financial measures determined under U.S. GAAP. For example, the non-GAAP financial information presented above may be determined or calculated differently by other companies and may not be directly comparable to that of other companies. In addition, free cash flow does not reflect our future contractual commitments and the total increase or decrease of our cash balance for a given period. Further, Adjusted EBITDA excludes some costs, namely, non-cash stock-based compensation expense, acquisition transaction costs, and amortization of acquisition-related intangible assets. Therefore, Adjusted EBITDA does not reflect the non-cash impact of stock-based compensation expense or working capital needs that will continue for the foreseeable future. All of these limitations could reduce the usefulness of these non-GAAP financial measures as analytical tools. Investors are encouraged to review the related U.S. GAAP financial measures and the reconciliations of these non-GAAP financial measures to their most directly comparable U.S. GAAP financial measures and to not rely on any single financial measure to evaluate our business.

Free Cash Flow and Free Cash Flow Margin U.S. GAAP Reconciliation

Year Ended December 31,

2025

2024

(dollars in thousands)

Revenue

$

239,024 

$

204,314 

Net cash provided by operating activities

$

17,540 

$

14,149 

Less: Purchase of property and equipment

(2,389)

(2,185)

Less: Capitalized internal-use software costs

(2,291)

(1,600)

Free cash flow

$

12,860 

$

10,364 

Net cash provided by (used in) investing activities

$

(6,846)

$

8,882 

Net cash used in financing activities

$

(7,331)

$

(22,191)

Net cash provided by operating activities as a percentage of revenue

7 

%

7 

%

Free cash flow margin

5 

%

5 

%

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Adjusted EBITDA U.S. GAAP Reconciliation

Year Ended December 31,

2025

2024

(dollars in thousands)

Net loss

$

(28,052)

$

(28,346)

Interest expense

1,700 

1,523 

(Benefit) provision for income taxes

(924)

189 

Interest income

(1,811)

(1,851)

Other (income) expense, net

(1,523)

(2,928)

Depreciation(1)

2,071 

2,189 

Amortization(2)

1,901 

1,542 

Amortization of acquisition-related intangibles

866 

— 

Stock-based compensation

32,131 

32,220 

Acquisition transaction costs(3)

1,696 

$

— 

Adjusted EBITDA

$

8,055 

$

4,538 

______________

(1)    Does not include amortization of finance lease right-of-use assets on phone hardware provided to our customers.

(2)    Represents amortization of capitalized internal-use software and cloud computing costs.

(3)    Represents expenses incurred with third parties as part of the Company’s acquisition activity, including due diligence, closing, and post-closing integration activities.

Liquidity and Capital Resources

Since inception, we have financed our operations primarily through cash generated from the sale of subscriptions to our platform, and the net proceeds received from issuances of our equity securities. We have generated losses from our operations as reflected in our accumulated deficit of $319.1 million as of December 31, 2025 but we have generally generated positive cash flows from operations since fiscal year 2023. Our future capital requirements will depend on many factors, including revenue growth and costs incurred to support customer usage and growth in our customer base, and increased research and development expenses to support the growth of our business and related infrastructure. We expect our operating cash flows to further improve as we increase our operational efficiency and experience economies of scale.

As of December 31, 2025, our principal sources of liquidity were cash held as deposits in financial institutions and cash equivalents consisting of highly liquid investments in money market securities of $55.0 million, as well as $26.8 million in other short-term investments comprised primarily of treasury and commercial paper instruments.

A substantial source of our cash inflow from operating activities is our deferred revenue, which is included on our consolidated balance sheets as a liability. Deferred revenue consists of the unearned portion of billed fees for our subscriptions, which is recorded as revenue over the subscription term. We had $38.1 million of deferred revenue recorded as a current liability as of December 31, 2025. This deferred revenue will be recognized as revenue when all of the revenue recognition criteria are met.

We assess our liquidity primarily through our cash on hand as well as the projected timing of billings under contract with our paying customers and related collection cycles. We believe our current cash, cash equivalents, short-term investments, and amounts available under our senior secured credit facility will be sufficient to meet our working capital and capital expenditure requirements for at least the next twelve months.

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The following table shows a summary of our cash flows for the periods presented:

Year Ended December 31,

2025

2024

(in thousands)

Net cash provided by operating activities

$

17,540 

$

14,149 

Net cash provided by (used in) investing activities

(6,846)

8,882 

Net cash used in financing activities

(7,331)

(22,191)

Operating Activities

For the year ended December 31, 2025, cash provided by operating activities was $17.5 million, primarily consisting of our net loss of $28.1 million adjusted for non-cash charges of $63.7 million, and net cash outflows of $18.1 million provided by changes in our operating assets and liabilities. The drivers of the changes in operating assets and liabilities were a $18.3 million increase in deferred contract costs, comprised of sales commissions earned on bookings, a $4.2 million decrease in operating lease liabilities from payments made, an increase to accounts receivable of $1.6 million, a decrease in deferred revenue of $1.7 million and decrease in accounts payable of $1.1 million. These amounts were partially offset by an increase in accrued liabilities of $7.1 million, and a decrease of $1.6 million to prepaid expenses and other assets.

For the year ended December 31, 2024, cash provided by operating activities was $14.1 million, primarily consisting of our net loss of $28.3 million adjusted for non-cash charges of $60.8 million, and net cash outflows of $18.3 million provided by changes in our operating assets and liabilities. The drivers of the changes in operating assets and liabilities were a $15.3 million increase in deferred contract costs, comprised primarily of sales commissions earned on new sales, a $4.0 million decrease in operating lease liabilities from payments made, a decrease to accounts receivable of $2.1 million, and a decrease in accrued liabilities of $0.9 million. These amounts were partially offset by a $3.1 million increase in accounts payable, $0.5 million increase in deferred revenue, and a decrease of $0.4 million to prepaid expenses and other assets.

Investing Activities

Cash provided by investing activities for the year ended December 31, 2025 was $6.8 million, primarily due to $58.5 million of maturities of short-term investments, which were partially offset by $36.8 million in purchases of short-term investments. Additionally, we purchased $2.4 million in furniture, equipment and leasehold improvements, capitalized $2.3 million of personnel-related costs as internal-use software development, and incurred $23.9 million in business acquisitions, net of cash acquired.

Cash provided by investing activities for the year ended December 31, 2024 was $8.9 million, primarily due to $66.4 million of maturities of short-term investments, which were partially offset by $53.8 million in purchases of short-term investments. Additionally, we purchased $2.2 million in furniture, equipment and leasehold improvements, and capitalized $1.6 million of personnel-related costs as internal-use software development.

Financing Activities

Cash used in financing activities for the year ended December 31, 2025 was $7.3 million, due to $2.9 million from payments made for taxes related to the net share settlement of equity awards and $7.2 million from principal payments made on finance lease obligations. These cash outflows were partially offset by $2.0 million received from our employee stock purchase plan and $0.8 million in proceeds received from employee stock option exercises.

Cash used in financing activities for the year ended December 31, 2024 was $22.2 million, due to $18.9 million from payments made for taxes related to the net share settlement of equity awards and

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$7.1 million from principal payments made on finance lease obligations. These cash outflows were partially offset by $2.0 million received from our employee stock purchase plan and $1.7 million in proceeds received from employee stock option exercises.

Critical Accounting Estimates

Our consolidated financial statements included elsewhere in this Annual Report on Form 10-K are prepared in accordance with U.S. GAAP. The preparation of our consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, costs and expenses and related disclosures. We evaluate our estimates and assumptions on an ongoing basis. Our estimates are based on historical experience and various other assumptions that we believe to be reasonable under the circumstances. Our actual results could differ from these estimates. To the extent that there are differences between our estimates and actual results, our future financial statement presentation, financial condition, results of operations, and cash flows will be affected.

We believe that of our significant accounting policies, which are described in Note 2 to our consolidated financial statements included in “Part II, Item 8. Financial Statements and Supplementary Data” of this Annual Report on Form 10-K, the following accounting policies involve a greater degree of judgment and complexity. Accordingly, these are the policies we believe are the most critical to aid in fully understanding and evaluating our consolidated financial condition, results of operations, and cash flows.

Deferred Contract Costs

Deferred contract costs are incremental costs that are associated with acquiring and fulfilling customer contracts and consist primarily of sales commissions and the associated payroll taxes and certain referral fees paid to independent third-parties. The costs incurred upon the execution of the contracts are primarily deferred and amortized over an expected benefit period, which we estimate to be three years. Significant judgment is used to determine the expected benefit period by taking into consideration the Company’s technology life cycle and an estimated customer relationship period, including expected contract renewals. There have been no changes to this estimated period of benefit during the reporting period.

Stock-Based Compensation

We issue stock options and restricted stock units (“RSUs”) to employees, consultants, and directors, and stock purchase rights granted under the Employee Stock Purchase Plan (“ESPP”) to employees based on their estimated fair value on the date of the grant. For stock options and ESPP, the fair value is estimated using the Black-Scholes option-pricing model. The fair value of RSUs is based on the closing market price of our common stock on the date of the grant. For stock options, the ESPP, and RSUs, the related stock-based compensation is recognized in the consolidated statements of operations and comprehensive loss using the straight-line attribution method. We recognize stock-based compensation expense over the requisite service period, which is the vesting period of the respective awards. Forfeitures are accounted for when they occur.

Changes in the assumptions, which are subjective and generally require significant analysis and judgment to develop, can materially affect the valuation of our equity awards and impact how much stock-based compensation expense is recognized.

Income Taxes

We recognize deferred tax assets and liabilities based on the differences between the financial statement carrying amounts and the respective tax bases of our assets and liabilities. Deferred tax assets and liabilities are measured using current enacted tax rates expected to apply to taxable income in the years in which we expect the temporary differences to reverse. We evaluate the likelihood of any future benefit of deferred tax assets and, based on that evaluation, record a valuation allowance if we determine that a portion of that benefit will not be realized. Our valuation allowance is based on management’s

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judgment and estimates of future business performance and taxes to be paid. Actual results could differ and may materially impact our financial statements in future periods.

Business Combinations

We allocate the purchase price of an acquisition to the tangible and intangible assets acquired and the liabilities assumed based on their estimated fair values. The excess of the purchase price over the fair value of the net assets acquired is recorded as goodwill.

Accounting for business combinations requires that we make significant estimates and assumptions to determine the fair value of assets acquired and liabilities assumed at the acquisition date. Although we believe the assumptions and estimates we use to be reasonable and appropriate, they are inherently uncertain. Critical estimates in valuing certain acquired assets may include, but are not limited to, expected future cash flows, including revenue growth rate assumptions from product sales, customer contracts and acquired technologies, the estimated royalty rates we anticipate will be relieved by acquiring the target’s technology and trademarks, and assumptions associated with the technology migration curve. We derive the discount rates used to discount expected future cash flows to present value using a weighted-average cost of capital analysis adjusted to reflect inherent risks. Unanticipated events and circumstances may occur that could affect either the accuracy or validity of these assumptions, estimates, or actual results.

Contractual Obligations and Commitments

Refer to the notes to our consolidated financial statements within “Part II, Item 8. Financial Statements and Supplementary Data” of this Annual Report on Form 10-K for more details on contractual obligations.

Our principal commitments consist of obligations under the Silicon Valley Bank Credit Facility (discussed below and within Note 13), operating leases for office space (Note 9), finance leases for phone equipment for our solution (Note 9), as well as non-cancellable purchase commitments (Note 12).

Indemnifications

Certain of our agreements with partners, resellers and customers include provisions for indemnification against liabilities should our platform contribute to a data compromise, particularly a compromise of protected health information (“PHI”). We have not incurred any costs as a result of such indemnification obligations historically and have not accrued any liabilities related to such obligations in our consolidated financial statements as of December 31, 2025.

Silicon Valley Bank Credit Facility

In August 2021, we established a revolving line of credit with SVB, a division of First-Citizens Bank & Trust Company (“SVB”) allowing for total borrowing capacity up to $50.0 million, subject to reduction should we fail to meet certain metrics for recurring revenue and customer retention (the “August 2021 Agreement”). In July 2025, the Company amended the SVB revolving line of credit (the “July 2025 Amendment”). The line of credit, as amended, maintained a total borrowing capacity of up to $50.0 million and matures in May 2027. Amounts outstanding on the revolving line of credit accrue interest at the greater of prime rate less 0.25% and 3.50%. We are required to pay a recurring annual fee of $0.1 million beginning in July 2026 on the anniversary of the effective date of the July 2025 Amendment. The revolving line of credit is collateralized by substantially all of the Company’s assets. The July 2025 Amendment includes financial covenants requiring that, at any time, if our total unrestricted cash and cash equivalents held at SVB, plus our short-term investments managed by SVB, is less than $100.0 million, we must at all times thereafter maintain a consolidated minimum liquidity of $20 million, meaning unencumbered cash and short-term investments plus available borrowing on the line of credit, and that we are required to meet specified minimum levels of EBITDA as adjusted for stock-based compensation expense and changes in our deferred revenue balances. We did not take any advances on the revolving

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line of credit in the year ended December 31, 2025. As of December 31, 2025, there was no outstanding balance on the line of credit, the full $50.0 million in borrowing capacity was available to us, and we were in compliance with all SVB loan covenants.

Recently Adopted Accounting Pronouncements

For more information on recent accounting pronouncements, see the sections titled “Basis of Presentation and Summary of Significant Accounting Policies—Accounting Pronouncements Adopted” and “—Accounting Pronouncements Pending Adoption” in Note 2 to our consolidated financial statements in Part II, Item 8, "Financial Statements and Supplementary Data" in this Annual Report on Form 10-K.

Emerging Growth Company Status

We are an “emerging growth company”, as defined in the Jumpstart Our Business Startups Act (the “JOBS Act”), and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging growth companies.” We may take advantage of these exemptions until we are no longer an “emerging growth company.” Section 107 of the JOBS Act provides that an “emerging growth company” can take advantage of the extended transition period afforded by the JOBS Act for the implementation of new or revised accounting standards. We have elected to use the extended transition period for complying with new or revised accounting standards and as a result of this election, our financial statements may not be comparable to companies that comply with public company effective dates. We may take advantage of these exemptions up until December 31, 2026.