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Debt | 9 Months Ended
--- | ---
Sep. 30, 2025
Debt Disclosure [Abstract] |
Debt | Debt Current and long term debt as of September 30, 2025 and December 31, 2024 consisted of the following:
| September 30, 2025 |  | December 31, 2024
| (in thousands)
Convertible Senior Notes | $ | 205,067 |  |  | $ | 205,067 |
Less: Unamortized debt issuance costs | (545) |  |  | (1,424) |
Net carrying value of Convertible Senior Notes | 204,522 |  |  | 203,643 |
2024 Term Loan B Facility | 361,361 |  |  | 363,177 |
Less: Unamortized debt discount and issuance costs | (9,618) |  |  | (13,075) |
Net carrying value of 2024 Term Loan B Facility | 351,743 |  |  | 350,102 |
Balance Sheet Presentation: |  |  |
Debt, current, net of debt issuance costs | 208,154 |  |  | 3,641 |
Debt, non-current, net of debt discount and issuance costs | 348,111 |  |  | 550,104 |
Total debt | $ | 556,265 |  |  | $ | 553,745 |
Maturities of the principal amount of the Company's debt were as follows as of September 30, 2025 (in thousands):
Fiscal Year |
Remaining 2025 | $ | 908 |
2026 | 208,699 |
2027 | 3,632 |
2028 | 3,632 |
2029 | 3,632 |
Thereafter | 345,925 |
Total | $ | 566,428 |
Amortization of debt discount and debt issuance costs is computed using the effective interest method and is included in interest expense in the condensed consolidated statement of operations. Amortization of the debt discount and debt issuance costs associated with the Company's indebtedness totaled $0.8 million and $2.3 million for the three and nine months ended September 30, 2025, respectively, and $0.8 million and $2.7 million for the three and nine months ended September 30, 2024, respectively. In addition, amortization of deferred financing costs was an immaterial amount for each of the three and nine months ended September 30, 2025 and 2024. Deferred financing costs are included in other assets, non-current in the condensed consolidated balance sheets. Convertible Senior Notes and Capped Call Transactions In March 2021, the Company issued $400.0 million aggregate principal amount of 0.25% convertible senior notes in a private placement, including $50.0 million aggregate principal amount of such notes pursuant to the exercise in full of the over-allotment options of the initial purchasers (collectively, the "Convertible Senior Notes"). The Convertible Senior Notes will mature on March 15, 2026, unless earlier repurchased, redeemed or converted. During the year ended December 31, 2023, the Company repurchased $194.9 million of principal balance of its Convertible Senior Notes in the open market with cash on hand for $165.5 million. The following table sets forth interest expense related to the Convertible Senior Notes for the three and nine months ended September 30, 2025 and 2024 (in thousands, except interest rates):
| Three Months Ended |  | Nine Months Ended
| September 30, 2025 |  | September 30, 2024 |  | September 30, 2025 |  | September 30, 2024
Contractual interest expense | $ | 129 |  |  | $ | 129 |  |  | $ | 385 |  |  | $ | 385 |
Amortization of debt issuance costs | 292 |  |  | 293 |  |  | 879 |  |  | 880 |
Total interest expense | $ | 421 |  |  | $ | 422 |  |  | $ | 1,264 |  |  | $ | 1,265 |
Effective interest rate | 0.82 | % |  | 0.82 | % |  | 0.82 | % |  | 0.82 | %
The estimated remaining amortization expense for the Company's debt issuance costs related to the Convertible Senior Notes was as follows as of September 30, 2025 (in thousands):
Fiscal Year | Debt Issuance Costs
Remaining 2025 | $ | 293 |
2026 | 252 |
Total | $ | 545 |
2021 and 2024 Credit Agreements On April 30, 2021, the Company entered into a credit agreement (the "2021 Credit Agreement") with Goldman Sachs Bank USA as administrative agent and collateral agent, and other lender parties thereto. The 2021 Credit Agreement provided for a $360.0 million seven-year senior secured term loan facility ("2021 Term Loan B Facility"), which had a maturity in April 2028, and a $65.0 million senior secured revolving credit facility (as amended in June 2021, the "2021 Revolving Credit Facility"), which had a maturity in December 2025. In June 2023, the Company amended the 2021 Credit Agreement (the "Amended 2021 Credit Agreement") to transition away from a variable interest rate based on the Eurodollar Rate towards a similar variable interest rate based on Adjusted Term SOFR, as defined in the Amended 2021 Credit Agreement, which is based on the secured overnight financing rate ("SOFR"). On February 6, 2024, the Company refinanced the Amended 2021 Credit Agreement and entered into a new credit agreement (the "2024 Credit Agreement") with Morgan Stanley Senior Funding, Inc. as the Company term loan administrative agent and Citibank, N.A. as the Company's revolving facility administrative agent and collateral agent, and other lender parties thereto. The 2024 Credit Agreement included a $365.0 million seven-year senior secured term loan facility (the "2024 Term Loan B Facility"), which will mature in February 2031 and a $175.0 million five-year senior secured revolving credit facility (the "2024 Revolving Credit Facility"), which will mature in February 2029. The Company primarily used the proceeds from the 2024 Term Loan B Facility to repay in full all outstanding amounts owed under the Company's Amended 2021 Credit Agreement. Accordingly, the Amended 2021 Credit Agreement was terminated and replaced in its entirety. The obligations under the 2024 Credit Agreement are secured by substantially all of the assets of the Company. On September 18, 2024, the Company entered into Amendment No. 1 to the 2024 Credit Agreement ("Amendment No. 1"), which reduced the interest rate of the 2024 Term Loan B Facility by 75 basis points to Term SOFR (as defined in the 2024 Credit Agreement) plus a margin of 3.75% from the previous rate of Term SOFR plus a margin of 4.50%, and on March 18, 2025, the Company entered into Amendment No. 2 to the 2024 Credit Agreement ("Amendment No. 2"), which reduced the interest rate of the 2024 Term Loan B Facility by an additional 75 basis points to Term SOFR plus a margin of 3.00%. The remaining terms of the 2024 Term Loan B Facility and the 2024 Revolving Credit Facility were substantially unchanged by these amendments. As of September 30, 2025, the contractual interest rate related to the 2024 Term Loan B Facility was 7.16%. In addition to having to pay contractual interest on the 2024 Term Loan B Facility, the Company is also required to pay certain other fees, primarily to the lenders under the 2024 Revolving Credit Facility, in order to maintain their revolving facility commitments. The covenants of the 2024 Credit Agreement include customary negative covenants that, among other things, restrict the Company’s ability to incur additional indebtedness, grant liens and make certain acquisitions, investments, asset dispositions and restricted payments. In addition, the 2024 Credit Agreement contains a springing financial covenant that is tested on the last day of any fiscal quarter only if utilization of the 2024 Revolving Credit Facility exceeds 35% of the total revolving commitments, whereby the Company is required to maintain a First Lien Net Leverage Ratio below 3.25 to 1.00. As of September 30, 2025, no amounts were outstanding under the 2024 Revolving Credit Facility and the Company was in compliance with its debt covenants. At September 30, 2025, amounts available under the 2024 Revolving Credit Facility were $171.0 million, net of letters of credit outstanding in the amount of $4.0 million. The 2024 Credit Agreement includes customary events of default, and customary rights and remedies upon the occurrence of any event of default thereunder, including rights to accelerate the loans, terminate the commitments thereunder and realize upon the collateral securing the obligations under the 2024 Credit Agreement. The 2024 Credit Agreement calls for customary scheduled loan amortization payments of 0.25% of the initial principal balance, which at the time of Amendment No. 2 was $363.2 million, payable quarterly (i.e. 1% in aggregate per year) as well as a provision that requires the Company to prepay the 2024 Term Loan B Facility based on an annual calculation of free cash flow ("Excess Cash Flow") as defined by the 2024 Credit Agreement. The Company was not required to make any such mandatory prepayment required by the Excess Cash Flow provision for the period ended September 30, 2025. The following table summarizes the amount outstanding under the Company's 2024 Term Loan B Facility at September 30, 2025 and December 31, 2024:
| September 30, 2025 |  | December 31, 2024 |
| (in thousands)
2024 Term Loan B Facility | $ | 361,361 |  |  | $ | 363,177 |  |
Unamortized debt discount | (4,490) |  |  | (6,198) |  |
Unamortized debt issuance costs | (5,128) |  |  | (6,877) |  |
2024 Term Loan B Facility, net of debt discount and issuance costs | $ | 351,743 |  |  | $ | 350,102 |  |
February 6, 2024 Debt Refinance As part of the debt refinance on February 6, 2024, where lenders under the Amended 2021 Credit Agreement continued to be lenders under the 2024 Credit Agreement, certain of their loans and revolving facility commitments were deemed to have been modified ("Modified Loans" and "Modified Commitments," respectively). The Company continued to defer debt discount costs of $3.7 million and debt issuance costs of $5.7 million from Modified Loans over the term of the new 2024 Term Loan B Facility. The Company continued to defer financing costs as of February 6, 2024 of an immaterial amount from Modified Commitments over the term of the new 2024 Revolver Facility. For lenders of the 2021 Credit Agreement that did not continue to participate in the 2024 Credit Agreement, their pro-rata portion of the unamortized debt discount of $2.8 million, unamortized debt issuance costs of $4.3 million, and unamortized deferred financing costs of an immaterial amount were deemed to be extinguished. The resulting loss on extinguishment of debt of $7.4 million is included in other (income) expense in the Company's condensed consolidated statement of operations for the nine months ended September 30, 2024. The Company paid $7.7 million in third-party fees related to the closing of the 2024 Credit Agreement. Third-party fees attributed to new lenders of $2.4 million were capitalized as part of the debt issuance costs and will be amortized over the term of the 2024 Term Loan B Facility while third-party fees attributed to Modified Loans of $3.1 million were included in general and administrative expenses in the Company's condensed consolidated statement of operations for the nine months ended September 30, 2024. In addition, third-party fees of $2.1 million attributed to new revolving lenders and Modified Commitments were capitalized as part of deferred financing costs and will be amortized over the term of the 2024 Revolving Facility. The Company also capitalized additional debt discount costs of $3.7 million associated with the closing of the 2024 Term Loan B Facility, which will be amortized over the term of the 2024 Term Loan B Facility. September 18, 2024 Debt Repricing The Company analyzed the changes of Amendment No. 1 on a lender-by-lender basis and determined that the transaction would primarily be accounted for as a modification, with a portion of it accounted for as debt extinguishment and new debt issuance. As a result, the Company recognized an immaterial loss on extinguishment related to unamortized debt discount and unamortized debt issuance costs related to the portion of the 2024 Term Loan B Facility that was extinguished. The Company paid $1.0 million in third-party fees related to Amendment No. 1 of which an immaterial amount was capitalized as debt issuance costs and $1.0 million was included in general and administrative expenses in the Company's condensed consolidated statement of operations for the three and nine months ended September 30, 2024. As part of Amendment No. 1, most lenders decided to roll their loan balances over from the original 2024 Term Loan B Facility to the amended 2024 Term Loan B Facility, while some decided to cash out and reassign their loan balances. On September 18, 2024, $312.0 million of the 2024 Term Loan B Facility principal balance was rolled over as part of non-cash financing activities while $52.1 million of the 2024 Term Loan B Facility principal balance was repaid and then reissued. March 18, 2025 Debt Repricing The Company analyzed the changes of Amendment No. 2 on a lender-by-lender basis and determined that the transaction would primarily be accounted for as a modification, with a portion of it accounted for as debt extinguishment and new debt issuance. As a result, the Company recognized a loss on extinguishment of $2.2 million related to $1.0 million of unamortized debt discount and $1.1 million of unamortized debt issuance costs related to the portion of the 2024 Term Loan B Facility that was extinguished. The Company paid $1.1 million in third-party fees related to Amendment No. 2 of which an immaterial amount was capitalized as debt issuance costs and $1.0 million was included in general and administrative expenses in the Company's condensed consolidated statement of operations for the nine months ended September 30, 2025. As part of Amendment No. 2, most of the 2024 Term Loan B lenders decided to roll their loan balances over from Amendment No. 1 to Amendment No. 2, while some decided to cash out and reassign their loan balances. On March 18, 2025, $270.6 million of the 2024 Term Loan B principal balance from Amendment No. 1 was rolled over to Amendment No. 2 as part of non-cash financing activities while $92.6 million of the 2024 Term Loan B Facility principal balance from Amendment No. 1 was repaid and then reissued as part of Amendment No. 2. The following table sets forth interest expense related to the 2024 Term Loan B Facility and the 2021 Term Loan B Facility (in thousands, except interest rates):
| Three Months Ended |  | Nine Months Ended
| September 30, 2025 |  | September 30, 2024 |  | September 30, 2025 |  | September 30, 2024
Contractual interest expense | $ | 6,786 |  |  | $ | 9,084 |  |  | $ | 20,738 |  |  | $ | 27,282 |
Amortization of debt discount | 216 |  |  | 264 |  |  | 688 |  |  | 848 |
Amortization of debt issuance costs | 247 |  |  | 292 |  |  | 776 |  |  | 1,008 |
Total interest expense | $ | 7,249 |  |  | $ | 9,640 |  |  | $ | 22,202 |  |  | $ | 29,138 |
Effective interest rate | 8.00 | % |  | 10.59 | % |  | 8.16 | % |  | 10.71 | %
The estimated remaining amortization expense for the 2024 Term Loan B Facility debt discount and debt issuance costs was as follows as of September 30, 2025 (in thousands):
Fiscal Year | Debt Discount |  | Debt Issuance Costs
Remaining 2025 | $ | 215 |  |  | $ | 246 |
2026 | 856 |  |  | 978 |
2027 | 847 |  |  | 968 |
2028 | 839 |  |  | 958 |
2029 | 830 |  |  | 948 |
Thereafter | 903 |  |  | 1,030 |
Total | $ | 4,490 |  |  | $ | 5,128 |
Total Interest Expense and Interest Income Interest expense consists primarily of contractual interest expense and amortization of debt discount, debt issuance costs, and deferred financing costs related to the Company's debt facilities under its 2024 Credit Agreement and Amended 2021 Credit Agreement as well as its Convertible Senior Notes. Interest income primarily consists of interest earned on the Company's cash equivalents. The following includes interest expense and interest income, as presented within interest expense, net in the condensed consolidated statement of operations (in thousands):
| Three Months Ended |  | Nine Months Ended
| September 30, 2025 |  | September 30, 2024 |  | September 30, 2025 |  | September 30, 2024
Interest expense | $ | 7,901 |  |  | $ | 10,522 |  |  | $ | 24,122 |  |  | $ | 31,140 |
Interest income | (3,233) |  |  | (3,674) |  |  | (9,206) |  |  | (9,541) |
Interest expense, net | $ | 4,668 |  |  | $ | 6,848 |  |  | $ | 14,916 |  |  | $ | 21,599 |

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- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 815 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 8A -Publisher FASB -URI https://asc.fasb.org/1943274/2147480434/815-10-50-8A Reference 2: http://www.xbrl.org/2003/role/disclosureRef 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