Convertible debt (Notes)

9 Months Ended

Sep. 30, 2025

Convertible Senior Notes

The following is a summary of the Company's convertible senior notes as of September 30, 2025 (in thousands):


	Date of Issuance	Unpaid Principal Balance		Contractual Interest Rates



1% Convertible Notes due in 2024 ("2024 Notes")	May 2019	$	—		1%
2.25% Convertible Notes due in 2027 ("2027 Notes")	September 2020 and October 2023	$	79,947		2.25%
2.5% Convertible Notes due in 2030 ("2030 Notes")	June 2025	$	235,000		2.5%
Total Notes		$	314,947

On June 12, 2025, the Company entered into privately-negotiated agreements (the “Exchange Agreements”) with a limited number of existing holders of the 2027 Notes who are “qualified institutional buyers” (as defined in Rule 144A under the Securities Act of 1933, as amended) (such existing holders, the “Exchange Participants”) to exchange approximately $186.9 million aggregate principal amount of the Exchange Participants’ existing 2027 Notes for $185.0 million aggregate principal amount of the Company’s newly-issued 2030 Notes and cash for accrued and unpaid interest on the 2027 Notes (such exchange transactions, the “Exchange”).

Although the Exchange was not completed until June 24, 2025, the Company determined that, from an accounting perspective, the Exchange was a legally binding restructuring of the debt that represented a substantial modification of the terms of the 2027 Notes subject to the Exchange, and therefore was required to be accounted for as an extinguishment transaction on June 12, 2025. The Company derecognized the portion of the carrying value of the 2027 Notes to be exchanged and recorded the new debt resulting from the substantial modification of terms at fair value as of June 12, 2025, which was approximately $185.0 million, and recorded a $4.2 million gain on debt extinguishment in the second quarter of 2025. The gain on debt

extinguishment is included in other income, net in the unaudited condensed consolidated statements of comprehensive (loss) income.

On June 12, 2025, the Company also entered into securities purchase agreements with the Exchange Participants to sell $50.0 million aggregate principal amount of the 2030 Notes at a cash purchase price of 100% of their principal amount (the "Purchase").

On June 24, 2025, the Company settled the Exchange, closed the Purchase and issued $235.0 million in 2030 Notes. The Company incurred debt issuance costs of approximately $4.1 million related to the Exchange and Purchase which is recorded in convertible debt, net. Approximately $0.3 million of the debt issuance costs were not paid as of September 30, 2025.

The 2030, 2027 and 2024 Notes (collectively, the "Notes") are general unsecured obligations of the Company and rank senior in right of payment to all of the Company's indebtedness that is expressly subordinated in right of payment to the Notes, rank equally in right of payment with all of the Company's existing and future general unsecured liabilities that are not so subordinated, are effectively junior to any of the Company's secured indebtedness to the extent of the value of the assets securing such indebtedness and are structurally subordinated to all indebtedness and other liabilities (including trade payables but excluding intercompany obligations owed to the Company or its subsidiaries).

The 2030 Notes mature on July 1, 2030 and the 2027 Notes mature on September 15, 2027, unless converted, redeemed or repurchased in accordance with their terms prior to such dates. The 2024 Notes matured on May 15, 2024 and the Company repaid the outstanding principal balance of $21.7 million during the second quarter of 2024.

Interest related to the 2030 Notes is payable semi-annually in arrears in cash on January 1 and July 1 of each year, beginning on January 1, 2026. Interest related to the 2027 Notes is payable semi-annually in arrears in cash on March 15 and September 15 of each year, beginning on March 15, 2021. Interest related to the 2024 Notes was payable semi-annually in arrears on May 15 and November 15 of each year, beginning on November 15, 2019.

Each $1,000 of principal of the 2030 Notes will initially be convertible into 48.8293 shares of the Company’s common stock, which is equivalent to an initial conversion price of approximately $20.48 per share and is subject to adjustment upon the occurrence of certain specified events. Each $1,000 of principal of the 2027 Notes will initially be convertible into 23.9137 shares of the Company’s common stock, which is equivalent to an initial conversion price of approximately $41.82 per share and is subject to adjustment upon the occurrence of certain specified events. Each $1,000 of principal of the 2024 Notes was initially to be convertible into 15.1394 shares of the Company’s common stock, which was equivalent to an initial conversion price of approximately $66.05 per share and was subject to adjustment upon the occurrence of certain specified events.

On or after April 1, 2030 to the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert all or any portion of their 2030 Notes regardless of the contingent conversion conditions described herein. Upon conversion, the Company will pay or deliver cash, shares of its common stock or a combination of cash and shares of its common stock, at its election, as described in the indenture governing the 2030 Notes.

Holders may convert their 2030 Notes at their option at any time prior to the close of business on the business day immediately preceding April 1, 2030 only under the following circumstances:

•during the five consecutive business day period immediately following any five consecutive trading day period (the "Measurement Period") in which the trading price per 2030 Note for each day of that Measurement Period was less than 98% of the product of the last reported sale price of the Company's common stock and the conversion rate on each such day;

•during any calendar quarter commencing after the calendar quarter ending on September 30, 2025, if the last reported sale price of the common stock for 20 or more trading days (whether or not consecutive) in a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price in effect on each such trading day; or

•upon the occurrence of specified corporate events.

If a fundamental change (as defined in the indenture governing the 2030 Notes) occurs prior to the maturity date, holders of the 2030 Notes may require the Company to repurchase all or a portion of their notes for cash at a repurchase price

equal to 100% of the principal amount at maturity of the 2030 Notes, plus any accrued and unpaid interest up to, but excluding, the repurchase date.

As of September 30, 2025, the 2030 and 2027 Notes are not yet convertible and their remaining term is approximately 58 months and 24 months, respectively.

As of September 30, 2025 and December 31, 2024, the fair value of the outstanding principal amount of the Notes in the aggregate was $382.3 million and $250.5 million, respectively. The estimated fair value was determined based on inputs that are observable in the market or that could be derived from, or corroborated with, observable market data, including the Company's stock price and interest rates, which represents level 2 in the fair value hierarchy.

The Notes consist of the following (in thousands):


	September 30, 2025		December 31, 2024

Principal	$	314,947	$	266,816
Debt premium, net of amortization	1,539		7,092
Debt issuance costs, net of amortization	(4,581)		(3,111)
Net carrying amount	$	311,905	$	270,797

The following table sets forth total interest expense recognized related to the Notes (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2025		2024		2025		2024
Coupon interest	$	1,918	$	1,501	$	4,948	$	4,576
Amortization of debt issuance costs	292		289		840		913
Amortization of debt premium	(196)		(669)		(1,418)		(2,018)
Total	$	2,014	$	1,121	$	4,370	$	3,471

Capped call transactions

On June 12, 2025, in connection with the Exchange and Purchase, the Company entered into capped call transactions (the “Capped Call Transactions”) with certain option counterparties. Funding of the Capped Call Transactions occurred on June 24, 2025 for approximately $27.9 million and was recorded as part of additional paid-in capital. The Capped Call Transactions cover, subject to customary anti-dilution adjustments, the number of shares of the Company’s common stock initially underlying the 2030 Notes, at a strike price that corresponds to the initial conversion price of the 2030 Notes, also subject to adjustment, and are exercisable upon conversion of the 2030 Notes. The Capped Call Transactions are intended to reduce potential dilution to the Company’s common stock and/or offset any cash payments the Company will be required to make in excess of the principal amounts upon any conversion of the Notes, and to effectively increase the overall conversion price of the 2030 Notes from $20.48 to $30.34 per share. As the Capped Call Transactions meet certain accounting criteria, they are not accounted for as derivatives.