Restructuring and Other Related Charges

12 Months Ended

Dec. 31, 2024

Restructuring and Related Activities [Abstract]

In December 2021, the Company's Board approved a restructuring plan (“Plan”) designed to advance the Company’s operating model, streamline its business, improve efficiency, and enhance its capital resources. As part of the first phase of the Plan, the Company reduced headcount by eliminating positions in certain areas of its organization. The first phase of the Plan began and was substantially completed during the quarter ended March 31, 2022. In May 2022, the Board approved additional actions related to the Plan through the year ending December 31, 2025. This second phase of the Plan consisted primarily of headcount-related reductions and was designed to achieve the same objectives as the first phase of the Plan.

On August 3, 2023, the Board approved further cost reduction actions (the "2023 Actions") to seek to drive higher levels of Adjusted EBITDA while maintaining the Company's long-term growth potential. The Company has incurred and expects to continue to incur restructuring charges in connection with the 2023 Actions, and anticipates that these charges will consist primarily of charges related to employee transition and severance payments, with a significantly smaller amount of charges relating to vendor contract termination and rationalization actions.

In connection with the Plan (including the 2023 Actions), the Company recorded a total of $6.0 million in restructuring charges during the year ended December 31, 2024, of which $1.6 million is recorded in "Services and other cost of goods sold" in the consolidated statements of operations for the year ended December 31, 2024 and $4.4 million is recorded in “Restructuring and other related charges” in the consolidated statement of operations for the years ended December 31, 2024. The Company recorded $17.3 million and $13.3 million for the years ended December 31, 2023 and 2022, respectively, in "Restructuring and other related charges" in the consolidated statements of operations.

The main categories of charges are in the following areas:

•Employee costs – include severance, related benefits, and retention pay costs incurred as a result of eliminating positions in certain areas of the Company. For the years ended December 31, 2024, 2023, and 2022, severance-related costs were $4.0 million, $11.7 million, and $9.5 million, respectively. In total, there were approximately 330 employees, across multiple functions, whose positions were made redundant. The $1.3 million current portion of the restructuring liability at December 31, 2024 is included in "Accrued wages and payroll taxes" in the consolidated balance sheet and is expected to be paid within the next 12 months.

•Real estate rationalization costs – includes costs to align the real estate footprint with the Company’s needs. During 2023, the Company vacated its Chicago and former Brussels office spaces, which resulted in the abandonment and termination of the underlying leases. In August 2024, the Company finalized its early termination agreement with the Chicago office landlord to terminate and release any further obligations for either

party. As of December 31, 2024, the Company accrued contract termination fees of $0.5 million for the Chicago office, which are included in "Current lease liabilities" in the consolidated balance sheet and which was paid in January 2025. In conjunction with the abandonment of the Chicago and former Brussels office leases in 2023, the underlying right-of-use assets and lease liabilities were written off and a $0.3 million gain and $0.1 million loss, respectively, were recorded related to rent concessions and tenant improvement allowances for restructuring. The Company wrote off $0.7 million and $0.6 million of fixed assets in its Chicago and Brussels leased office space, respectively (See Note 9, Property and Equipment, net). During 2023, the Company terminated its Brussels warehouse lease, effective July 31, 2024, and incurred settlement costs associated with the lease termination.

•Product and services optimization costs – includes costs to discontinue products and services that are no longer advancing the Company's operating model. The Company made the decision to stop any incremental development investments supporting its previously acquired blockchain technology, and related commercial efforts. As a result, the Company wrote-off the related acquired technology and previously capitalized software. The Company recorded a $0.8 million write-off of intangible assets in "Services and other costs of goods sold" on the consolidated statements of operations for the year ended December 31, 2024 (see Note 8, Intangible Assets, net). For capitalized software, the Company recorded a write-off of $1.0 million of property and equipment, net, of which $0.7 million was recognized in "Services and other costs of goods sold" on the consolidated statements of operations for the year ended December 31, 2024 (see Note 9, Property and Equipment, net). The remaining write-off amount of $0.3 million was recognized in "Restructuring and other related charges" on the consolidated statements of operations for the year ended December 31, 2024. During 2023, the Company made the decision to discontinue investments in its Digipass CX product and incurred $1.5 million of write-offs for capitalized software. The charges are recorded in "Restructuring and other related charges" on the consolidated statement of operations for the year ended December 31, 2024 (see Note 9, Property and Equipment, net).

•Vendor rationalization costs – includes costs for contractually committed services the Company is no longer utilizing. For the years ended December 31, 2024 and 2023, these costs totaled $0.2 million and $1.2 million, and are included in "Restructuring and other related charges" on the consolidated statements of operations.

•Impairment of intangibles – include impaired Dealflo customer relationships where the carrying value exceeded the fair value for the year ended December 31, 2022. The Company recorded a $3.8 million impairment charge on the entire remaining value of the asset during the year ended December 31, 2022. The charge is included in “Restructuring and other related charges” on the consolidated statement of operations and is included in "Operating income" of the Security Solutions reportable operating segment (See Note 8, Intangible Assets, net).

The table below sets forth the changes in the carrying amount of the restructuring charge liability for the years ended December 31, 2023 and 2024.


(In thousands)	Employee Costs		Real Estate Rationalization		Total
Balance as of January 1, 2023	$	3,596	$	—	$	3,596
Additions	11,703		1,885		13,588
Payments	(12,169)		—		(12,169)
Balance as of December 31, 2023	3,130		1,885		5,015
Additions	3,937		227		4,164
Payments	(5,810)		(1,587)		(7,397)
Balance as of December 31, 2024	$	1,257	$	525	$	1,782