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Restructuring and integration expense | 3 Months Ended
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Mar. 31, 2025
Restructuring and Related Activities [Abstract] |
Restructuring and integration expense |
NOTE 8: | RESTRUCTURING AND INTEGRATION EXPENSE
Restructuring and integration expense consists of costs related to initiatives aimed at driving earnings and cash flow growth, including costs related to the consolidation and migration of certain applications and processes. These costs consist primarily of consulting, project management services, internal labor, and other items such as facility closure and consolidation costs. Additionally, we have recorded employee severance costs across functional areas. Restructuring and integration expense is not allocated to our reportable business segments. We are currently pursuing several initiatives designed to support our growth strategy and to increase our efficiency, including several initiatives that we collectively refer to as our North Star program. The goal of this program is to enhance shareholder value by (1) accelerating our adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) growth, (2) increasing cash flow, (3) reducing debt, and (4) improving our leverage ratio. North Star is a comprehensive, multi-year plan that balances cost reduction and growth opportunities. On the cost side, we are focused on refining our organizational structure and transforming our infrastructure and operations. We have successfully completed the material elements of our organizational redesign, which included consolidating similar roles, reducing hierarchical layers, and expanding spans of control. We are also leveraging technology and process automation to digitize and streamline our operations. Additionally, we are scaling our operations by consolidating back-office functions and tapping into the global labor market. The associated restructuring and integration expense, which consisted primarily of consulting and employee severance costs, was approximately $8,000 during the quarter ended March 31, 2025 and $12,000 during the quarter ended March 31, 2024. To date, we have incurred expense of approximately $103,000, and we anticipate that we will incur approximately $7,000 of additional North Star restructuring and integration expense in 2025. Restructuring and integration expense is reflected on the consolidated statements of comprehensive income as follows:
|  | Quarter Ended March 31, |  |
(in thousands) |  | 2025 |  | 2024 |  |  |  |
Total cost of revenue |  | $ | 752 |  |  | $ | 933 |  |  |  |  |
Operating expenses |  | 7,668 |  |  | 13,804 |  |  |  |  |
Restructuring and integration expense |  | $ | 8,420 |  |  | $ | 14,737 |  |  |  |  |
Restructuring and integration expense for each period was comprised of the following:
|  | Quarter Ended March 31, |  |
(in thousands) |  | 2025 |  | 2024 |  |  |  |
Employee severance benefits |  | $ | 4,453 |  |  | $ | 1,972 |  |  |  |  |
External consulting and other costs |  | 2,523 |  |  | 7,969 |  |  |  |  |
Internal labor |  | 988 |  |  | 838 |  |  |  |  |
Other |  | 456 |  |  | 3,958 |  |  |  |  |
Restructuring and integration expense |  | $ | 8,420 |  |  | $ | 14,737 |  |  |  |  |
Our restructuring and integration accruals are included in accrued liabilities on the consolidated balance sheets. These accruals represent the anticipated cash payments necessary to fulfill the remaining severance obligations for employees who have already been terminated, as well as those expected to be terminated under our various initiatives. We expect that the majority of employee reductions and the associated severance payments will be completed by the end of 2025. Changes in our restructuring and integration accruals were as follows:
(in thousands) |  | Employee severance benefits
Balance, December 31, 2024 |  | $ | 3,755 |
Charges |  | 4,644 |
Reversals |  | (191) |
Payments |  | (1,845) |
Balance, March 31, 2025 |  | $ | 6,363 |
The charges and reversals shown in the rollforward of our restructuring and integration accruals exclude items that are expensed as incurred, as these items are not included in accrued liabilities on the consolidated balance sheets.

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- Definition The entire disclosure for restructuring and related activities. Description of restructuring activities such as exit and disposal activities, include facts and circumstances leading to the plan, the expected plan completion date, the major types of costs associated with the plan activities, total expected costs, the accrual balance at the end of the period, and the periods over which the remaining accrual will be settled. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 420 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 5.P.4.e) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479823/420-10-S99-2 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 420 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (b)(2) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482017/420-10-50-1 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 420 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482017/420-10-50-1 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 420 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/420/tableOfContent Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 420 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (e) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482017/420-10-50-1 + Details
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