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SEGMENT DISCLOSURES
 3 Months Ended
Mar. 31, 2025
SEGMENT DISCLOSURES  
SEGMENT DISCLOSURES

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12.   SEGMENT DISCLOSURES

The Company operates its business as one operating segment. Operating segments are defined as components of an enterprise in which separate financial information is evaluated regularly by the chief operating decision maker (“CODM”) in deciding how to allocate resources and assess performance. The Company’s CODM, the Chief Executive Officer, reviews financial information regularly at the consolidated level. Net income (loss) and adjusted earnings before interest, taxes, depreciation, and amortization (“Adjusted EBITDA”), a non-GAAP measure, are both used as metrics to evaluate performance of the business in deciding whether to reinvest profits into software development, acquisitions or into other areas of the Company. The Company believes that Adjusted EBITDA is a useful supplemental measure to evaluate overall operating performance as it measures business performance by focusing on cash related results and it is an important metric to lenders under the Company’s Credit Agreement. The most directly comparable GAAP measure to Adjusted EBITDA is net income (loss).

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The CODM monitors consolidated forecasted versus actual net income (loss) and Adjusted EBITDA results for the purpose of determining the general health of the Company and assessing the performance of the Company as compared to management’s expectations.

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The following significant expense categories and measures of segment income (loss) are regularly reported to the CODM for the Company’s single segment:

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For the three months ended March 31,

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2025

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2024

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(unaudited)

Total Revenues

$

177,062

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$

156,781

Less:

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Cost of revenues – software subscriptions

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44,245

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45,128

Cost of revenues – services

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19,823

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15,861

Research & development

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20,886

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16,845

Selling & marketing

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48,155

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40,491

General & administrative

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45,028

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35,542

Depreciation & amortization

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5,880

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5,006

Change in fair value of acquisition contingent earn-outs

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(14,700)

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—

Other segment items (1)

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3,259

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(527)

Interest (income) expense, net

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(1,539)

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286

Income tax benefit

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(5,105)

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(4,535)

Net income (GAAP)

$

11,130

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$

2,684

Adjustments:

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Interest expense (income), net

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(1,539)

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286

Income tax benefit

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(5,105)

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(4,535)

Depreciation and amortization – property and equipment

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5,880

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5,006

Depreciation and amortization of capitalized software and acquired intangible assets – cost of subscription revenues

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15,855

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15,347

Amortization of acquired intangible assets – selling and marketing expense

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531

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595

Amortization of cloud computing implementation costs – general and administrative

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1,006

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994

Stock-based compensation expense

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21,044

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16,324

Severance expense

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457

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842

Acquisition contingent consideration

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—

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(800)

Change in fair value of acquisition contingent earn-outs

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(14,700)

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—

Transaction costs

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2,660

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—

Adjusted EBITDA (Non-GAAP)

$

37,219

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$

36,743

(1) Other segment items include professional fees, contracted labor, transaction costs, acquisition related earn-out adjustments and foreign currency exchange gains (losses).

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Additionally, the Company considers stock-based compensation expense a significant expense category. For further information, refer to Note 10, “Stock Based Award Plans.”

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As the Company operates solely within one segment, total assets, property and equipment, net, and capitalized software, net are reported at the consolidated level on the condensed consolidated balance sheets. The Company’s assets include both current and long-lived assets, and corporate assets. As of March 31, 2025 and December 31, 2024, $894 and $687, respectively, of the Company’s property and equipment assets were held outside of the U.S.

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Depreciation and amortization, property and equipment additions, and capital software additions are reported at the consolidated level on the condensed consolidated statements of cash flows.

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The Company disaggregates revenue from contracts with customers based on geographical regions, timing of revenue recognition, and the major product and service types. For the three months ended March 31, 2025 and 2024, approximately 8% and 7%, respectively, of the Company’s revenues were generated outside of the U.S. None of the Company’s customers represented more than 10% of total revenues for the three months ended March 31, 2025 or 2024. For further information including disaggregation of revenues, refer to Note 2, “Revenue Recognition.”