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Fair Value Measurements
 3 Months Ended
Sep. 30, 2025
Fair Value Disclosures [Abstract]  
Fair Value Measurements Fair Value Measurements
The authoritative guidance on fair value measurements establishes a three-tier fair value hierarchy for disclosure of fair value measurements as follows:
Level 1—Inputs are unadjusted, quoted prices in active markets for identical, assets or liabilities at the measurement date;
Level 2—Inputs are quoted prices in markets that are not active, or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability;
Level 3—Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported by little or no market activity).
Money market funds are classified as Level 1 as the assets are valued using quoted prices in active markets. The convertible debt instrument is classified as Level 3 due to the use of unobservable valuation inputs and limited market activity. Liabilities for contingent consideration related to business combinations are classified as Level 3 liabilities as the Company uses unobservable inputs in the valuation, specifically related to the projected total contract value generated by the acquired businesses for a distinct period of time.
Financial Assets and Liabilities
The following table sets forth the Company’s financial assets and liabilities that were measured at fair value on a recurring basis as of the date indicated by level within the fair value hierarchy (in thousands):
September 30, 2025June 30, 2025
Level 1Level 2Level 3TotalLevel 1Level 2Level 3Total
Financial Assets:
Cash equivalents:
Money market funds$216,294 $— $— $216,294 $243,232 $— $— $243,232 
Other assets:
Convertible debt instrument— — 2,990 2,990 — — — — 
Total financial assets$216,294 $— $2,990 $219,284 $243,232 $— $— $243,232 
Financial Liabilities:
Liability for contingent consideration, current portion$— $— $500 $500 $— $— $— $— 
Liability for contingent consideration, noncurrent portion— — 92 92 — — 86 86 
Total financial liabilities$— $— $592 $592 $— $— $86 $86 

In connection with the acquisition of TDI, the Company recorded a contingent liability of $0.2 million on the acquisition date for the estimated fair value of the contingent consideration, which was measured based on the probability of achieving certain performance measures pursuant to the acquisition agreement. Accordingly, the Company recorded a contingent consideration liability of $0.1 million as of September 30, 2025 and June 30, 2025, which was included in Other liabilities on the unaudited condensed consolidated balance sheets.
In connection with the acquisition of Paragon Data Labs, Inc. in May 2023, the Company recorded a contingent consideration liability of $4.3 million on the acquisition date for the estimated fair value of the contingent consideration. The fair value was measured based on the probability of achieving certain performance measures pursuant to the acquisition agreement. During the three months ended September 30, 2024, the Company made a fair value adjustment of $1.0 million based on the probability of achieving certain performance measures and paid $1.4 million related to the contingent consideration. In addition, during the three months ended September 30, 2025, the Company made a fair value adjustment of $0.5 million based on a finalized targeted earnout true-up. Accordingly, the contingent consideration was $0.5 million as of September 30, 2025 and nil as of June 30, 2025, and was included in Other current liabilities on the unaudited condensed consolidated balance sheets.
The fair value of the contingent consideration was initially estimated on the acquisition date using the Monte Carlo simulation and included key assumptions used by management related to the estimated probability of occurrence and discount rates. Subsequent changes in the fair value of the contingent consideration liabilities, resulting from management’s revision of key assumptions and estimates, have been recorded in General and administrative expenses on the unaudited condensed consolidated statements of operations. Gains and losses resulting from exchange rate fluctuation on contingent consideration liabilities denominated in currencies other than U.S. dollars are recognized in interest and other income, net on the unaudited condensed consolidated statements of operations.
Changes in contingent consideration liabilities were as follows (in thousands):
Three Months Ended September 30,
20252024
Balance, beginning of period$86 $2,558 
Payment of contingent consideration— (1,387)
Change of contingent consideration506 (920)
Effect of foreign currency exchange rate changes— 7 
Balance, end of period$592 $258 
Other financial instruments consist of accounts receivable, accounts payable, accrued expenses, accrued liabilities and other current liabilities, which are stated at their carrying value as it approximates fair value due to the short time to expected receipt or payment.
Strategic Investments
As of September 30, 2025 and June 30, 2025, the total amount of strategic investments included in Other assets on the Company’s unaudited condensed consolidated balance sheets were $5.0 million and $2.0 million, respectively. The Company did not recognize any unrealized gain or loss on the strategic investments for the periods presented.