XML 20 R9.htm IDEA: XBRL DOCUMENT
v3.26.1

Note 2 - Summary of Significant Accounting Policies | 6 Months Ended
--- | ---
Jun. 30, 2026
Notes to Financial Statements |
Significant Accounting Policies [Text Block] | 2. Summary of Significant Accounting Policies Basis of Presentation The accompanying unaudited condensed consolidated balance sheet as of December 31, 2025, which has been derived from audited financial statements, and the unaudited interim condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”)﻿ for interim financial information and include the accounts of the Company and entities consolidated under the variable interest and voting models. All intercompany transactions and balances have been eliminated. Certain information and disclosures normally included in consolidated financial statements prepared in accordance with accounting principles generally accepted in the U.S. (“GAAP”) have been condensed or omitted. In the opinion of management, these financial statements contain all material adjustments, consisting of normal recurring accruals, necessary to present fairly the financial position, results of operations and cash flows for the periods indicated. Operating results for the six months ended June 30, 2026 are not necessarily indicative of the results that may be expected for any other interim period or for the year ended December 31, 2026. These condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and the related notes included in the Company’s most recent Annual Report on Form 10-K for the year ended December 31, 2025, which was filed with the SEC on February 26, 2026 (“Annual Report”). Comparative Data The Company identified a misclassification of cash flows related to the May 2025 repurchase of non-controlling interests in previously issued financial statements. The prior period has been corrected to reclassify $12.1 million of cash flows for the six months ended June 30, 2025 from net cash used in investing activities to net cash provided by financing activities. The reclassification affects only the presentation of the condensed consolidated statement of cash flows and had no impact on the condensed consolidated balance sheets, statements of income (loss), or statements of stockholders' equity. The classification was appropriately presented in the Annual Report. Additionally, certain amounts from prior periods have been reclassed to conform to the current period presentation, including:
| • | The reclassification of maintenance revenue to be included in term license and support revenue on the condensed consolidated statements of income for the three and six months ended June 30, 2025;
| • | The reclassification of maintenance cost of revenue to be included in term license and support cost of revenue on the condensed consolidated statements of income for the three and six months ended June 30, 2025; and
| • | The reclassification of operating lease liabilities from accounts payable, accrued expenses, other current liabilities, operating lease liabilities and other liabilities on the condensed consolidated statements of cash flows for the six months ended June 30, 2025.
Recently Adopted Accounting Guidance In July 2025, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2025-05, “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets” (“ASU 2025-05”). This ASU introduces a practical expedient that allows entities to assume that current conditions as of the balance sheet date will not change for the remaining life of the asset when estimating expected credit losses for current accounts receivable and current contract assets. The Company adopted the guidance in ASU 2025-05 effective January 1, 2026, using the required prospective transition approach. The adoption of this standard did not have a material impact on the Company’s condensed consolidated financial statements and related disclosures. Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the Company’s condensed consolidated financial statements and accompanying notes. The Company bases its estimates and assumptions on historical experience and on various other assumptions that it believes are reasonable under the circumstances. The amounts of assets and liabilities reported and the amounts of revenue and expenses reported for each of the periods presented are affected by estimates and assumptions, which are used for, but not limited to, the accounting for the determination of standalone selling price for revenue recognition, deferred contract costs, valuation of goodwill and other intangible assets, income taxes and related reserves, stock-based compensation and purchase price in a business combination. Actual results and outcomes may differ from management’s estimates and assumptions due to risks and uncertainties. Cash and Cash Equivalents The Company maintains cash and cash equivalents with several high credit-quality financial institutions. The Company considers its investments with original maturities of three months or less to be cash equivalents. These investments are not subject to significant market risk. The Company maintains its cash and cash equivalents in bank accounts which, at times, exceed the federally insured limits. The Company has not experienced any losses in such accounts. The Company maintains cash balances used in operations at entities based in countries that impose regulations that limit the ability to transfer cash out of the country. As of June 30, 2026 and December 31, 2025, the Company’s cash balances at these entities were $17.0 million and $20.0 million, respectively. For purposes of the condensed consolidated statements of cash flows, cash includes all amounts in the condensed consolidated balance sheets captioned cash and cash equivalents. Business Combination When the Company consummates a business combination, the assets acquired and the liabilities assumed are recognized separately from goodwill at their acquisition date fair values. Goodwill as of the acquisition date is measured as the excess of the fair value of consideration transferred over the acquisition date fair value of the net identifiable assets acquired. While best estimates and assumptions are used to accurately value assets acquired and liabilities assumed at the acquisition date as well as contingent consideration, where applicable, the Company’s estimates are inherently uncertain and subject to refinement. As a result, during the measurement period, which may be up to one year from the acquisition date, the Company records adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill as it obtains new information about facts and circumstances that existed as of the acquisition date that, if known, would have affected the measurement of the amounts recognized as of that date. Upon the earlier of the conclusion of the measurement period or final determination of the values of assets acquired or liabilities assumed, any subsequent adjustments are recorded in the condensed consolidated statements of income. Goodwill No events or circumstances have changed since any of the Company’s acquisitions that would indicate that the fair value of the Company’s reporting unit is below its carrying amount. No impairment was deemed necessary as of June 30, 2026 or December 31, 2025. Deferred Contract Costs The Company defers sales commissions that are considered to be incremental and recoverable costs of obtaining or renewing SaaS, term license and support, and services contracts. Changes in the anticipated period of asset benefit or the average renewal term are recognized on a prospective basis upon occurrence. Amortization of deferred contract costs of $6.4 million and $12.7 million for the three and six months ended June 30, 2026, respectively, and $5.5 million and $11.0 million for the three and six months ended June 30, 2025, respectively, is included as a component of sales and marketing expenses in the Company’s condensed consolidated statements of income. Fair Value Measurement Fair value is the price that would be received upon selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Assets and liabilities recorded at fair value are measured and classified in accordance with a three-level fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows:
| • | Level 1 — Quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity can access at the measurement date.
| • | Level 2 — Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.
| • | Level 3 — Unobservable inputs for the asset or liability.
Revenue Recognition The Company derives revenue from three primary sources: SaaS, term license and support, and services. SaaS revenue is recognized ratably over the term of the contract. Term license and support revenue includes distinct on-premises license and support performance obligations. The license is generally recognized upfront at the point in time when the software is made available to the customer to download and use, and the support is recognized ratably over the term of the contract. Services revenue includes revenue derived primarily from the implementation of software, training, consulting, and migrations. The Company also offers license customization and managed services. Services revenue from implementation, training, consulting, migration, and license customization is recognized by applying a measure of progress, such as labor hours to determine the percentage of completion of each contract. Services revenue from managed services is recognized ratably on a straight-line basis over the contract term. Term license and support revenue recognized at a point in time was $6.4 million and $11.8 million for the three and six months ended June 30, 2026, respectively, and $5.0 million and $12.2 million for the three and six months ended June 30, 2025, respectively. The remaining revenue amount is recognized over time. Accounts receivable, net, is inclusive of accounts receivable, and current unbilled receivables, net of allowance for credit losses. The Company records an unbilled receivable when revenue is recognized prior to invoicing. The Company has a well-established collection history from its direct and indirect sales. It periodically evaluates the collectability of its accounts receivable and provides an allowance for credit losses as necessary, based on the age of the receivable, expected payment ability, and collection experience. The Company records deferred revenue in the condensed consolidated balance sheets when cash is collected or invoiced before revenue is earned. Revenue recognized that was included in the deferred revenue balance at the beginning of the period was $126.4 million for the six months ended June 30, 2026. The opening and closing balances of the Company’s accounts receivable, net, deferred revenue and deferred contract costs are as follows:
|  | Accounts |  |  |  |  |  |  | Deferred |
|  | receivable, |  |  | Deferred |  |  | contract |
|  | net (1) |  |  | revenue |  |  | costs |
|  | (in thousands) |
Balance, December 31, 2025 |  | $ | 135,089 |  |  | $ | 200,956 |  |  | $ | 71,257 |
Balance, June 30, 2026 |  |  | 130,761 |  |  |  | 213,071 |  |  |  | 74,305 |
(1) Includes long-term unbilled receivables included in other assets within the condensed consolidated balance sheets. There were no significant changes to the Company’s contract assets or liabilities during the six months ended June 30, 2026 and the year ended December 31, 2025 outside of its sales activities. As of June 30, 2026, transaction price allocated to remaining performance obligations, which includes deferred revenue and amounts that will be invoiced and recognized as revenue in future periods, was $559.4 million, of which $477.8 million is related to SaaS and term license and support revenue. The Company expects to recognize approximately 61% of the total transaction price allocated to remaining performance obligations over the next twelve months and the remainder thereafter. Stock-Based Compensation Stock-based compensation represents the cost related to stock-based awards granted to employees. To date, the Company has issued both stock options and restricted stock units. The Company measures stock-based compensation cost at the grant date based on the estimated fair value of the award and recognizes the cost ratably over the requisite service period, net of actual forfeitures in the period. The Company estimates the fair value of stock options using the Black-Scholes valuation model. The Black-Scholes model requires highly subjective assumptions in order to derive the inputs necessary to calculate the fair value of stock options. The Company calculates the expected term using the “simplified” method, which is the simple average of the vesting period and the contractual term. The simplified method is applied as the Company does not have sufficient historical data to provide a reasonable basis for an estimate of the expected term. Expected volatility is based on the historical and implied volatility of a group of peer entities over a similar expected term. Dividend yields are based upon historical dividend yields. Risk-free interest rates are based on the implied yields currently available on U.S. Treasury zero coupon issues with a remaining term equal to the expected term. Recent Accounting Pronouncements Not Yet Effective In November 2024, the FASB issued ASU No. 2024-03, “Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (ASC 220-40): Disaggregation of Income Statement Expenses” (“ASU 2024-03”), and in January 2025, the FASB issued ASU No. 2025-01, “Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (ASC 220-40): Clarifying the Effective Date” (“ASU 2025-01”). ASU 2024-03 requires public entities to disclose additional information about specific expense categories in the notes to the financial statements. ASU 2024-03, as clarified by ASU 2025-01, is effective in annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027. The amendments in this ASU may be applied either prospectively or retrospectively. Early adoption is also permitted. The Company is currently evaluating the impact ASU 2024-03 will have on its consolidated financial statements and related disclosures. In September 2025, the FASB issued ASU No. 2025-06, “Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software” (“ASU 2025-06”). ASU 2025-06 modernizes the capitalization criteria for internal-use software, eliminating references to project stages and instead requiring that projects meet completion probability criteria before costs can be capitalized. ASU 2025-06 is effective for annual periods beginning after December 15, 2027, and interim periods within those annual periods. The amendments in this ASU may be applied using a prospective, retrospective, or modified transition approach. Early adoption is also permitted. The Company is currently evaluating the impact ASU 2025-06 will have on its consolidated financial statements and related disclosures.

X
- References No definition available. + Details
Name: | us-gaap_DisclosureTextBlockAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for all significant accounting policies of the reporting entity. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 235 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/235/tableOfContent Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 235 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Publisher FASB -URI https://asc.fasb.org/1943274/2147483426/235-10-50-1 + Details
Name: | us-gaap_SignificantAccountingPoliciesTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration