Intapp Inc.
08/14/2026 | Press release | Distributed by Public on 08/14/2026 04:05
Annual Report for Fiscal Year Ending June 30, 2026 (Form 10-K)
Management's Discussion and Analysis of Financial Condition and Results of Operations.
The following discussion and analysis of our financial condition and results of operations should be read together with our audited consolidated financial statements and related notes and other financial information included in this Annual Report on Form 10-K. The following discussion contains forward-looking statements that reflect our plans, estimates, and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to these differences include those discussed below and elsewhere in this Annual Report on Form 10-K, particularly in the section titled "Cautionary Note regarding Forward-Looking Statements" and "Risk Factors". Our historical results are not necessarily indicative of the results that may be expected for any period in the future. Unless otherwise noted, any reference to a year preceded by the word "fiscal" refers to the fiscal year ended June 30 of that year.
A discussion regarding our financial condition and results of operations for the fiscal year ended June 30, 2026 compared to the fiscal year ended June 30, 2025 is presented below. A discussion regarding our financial condition and results of operations for the fiscal year ended June 30, 2025 compared to the fiscal year ended June 30, 2024 can be found in "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended June 30, 2025 filed with the SEC on August 20, 2025.
Overview
Intapp is a leading global provider of AI-powered solutions for professional firms in highly regulated industries. Intapp's vertically tailored solutions are purpose-built for the specialized workflows, complex relationship networks, and professional compliance requirements of accounting, consulting, investment banking, legal, private capital, and real assets firms. By applying Firm AI to core processes and data, Intapp helps partners, dealmakers, and advisors drive firm growth, manage compliance, and improve profitability.
Highlights for the Fiscal Year 2026
During fiscal year 2026, we generated total revenues of $577.8 million with a gross margin of 76%. Our operating cash flow was $146.8 million and we repurchased approximately 8.4 million shares of our common stock for $275.2 million, including broker fees. Total cash and cash equivalents as of June 30, 2026 were $162.8 million. Our remaining performance obligations, which represent all future revenue under contract yet to be recognized, were $833.0 million as of June 30, 2026. Additionally, during fiscal year 2026, we continued to invest in our research and development and sales and marketing efforts, reflecting our focus on delivering AI capabilities, including the introduction of Intapp Celeste, our agentic AI coworker.
How We Generate Revenue
We generate revenues primarily from the sale of subscriptions, typically with one-year or multi-year contract terms. We sell our subscriptions through a direct sales model, which targets clients based on end market, geography, firm size, and business need. We recognize revenues from cloud subscriptions ratably over the contract term. We recognize license revenues related to subscription fees upfront and license revenues related to support ratably over the term of the support contract. We generally price our subscriptions based on the number of users adopting our solution and the modules deployed.
We expect the vast majority of our new ARR (as defined below) growth in the future to be from the sale of cloud subscriptions.
We generate service revenues primarily from professional services. Our clients utilize these services to configure and implement one or more of our industry products and solutions, integrate those industry products and solutions with the existing platform and with other core systems in their IT environment, upgrade their existing deployment, and provide training for their employees. Other professional services include strategic consulting and advisory work, which are generally provided on a standalone basis.
Key Factors Affecting Our Performance
Market adoption of our AI Platform.
Our future growth depends on our ability to win new accounting, consulting, investment banking, legal, private capital and real assets clients and expand within our existing client base, primarily through the continued acceptance of our business. Our cloud business has historically grown faster than our overall business and represents an increasing proportion of our annual recurring revenues. We must demonstrate to new and existing clients the benefits of selecting our platform, and support those deployments once live with reliable and secure service. From a sales perspective, our ability to add new clients and expand within existing accounts depends upon a number of factors, including the rate at which professional firms accept AI-performed work as a substitute for human labor, regulatory and professional liability frameworks that govern AI use in legal, accounting, and advisory contexts, the competitive landscape for AI platforms in professional services, the quality and effectiveness of our sales personnel and marketing efforts, and our ability to convince key decision makers within the professional firms to embrace our vertical solutions over internally developed and horizontal solutions. If our clients do not continue to see the ability of our platform to generate return on investment relative to other software alternatives, net revenue retention could suffer and our operating results may be adversely affected.
Continued Investment in Innovation and Growth.
We have made substantial investments in research and development and sales and marketing to achieve a leadership position in our market and grow our revenues and client base. We intend to continue to invest in research and development to build new capabilities and maintain the core technology underpinning our differentiated platform. In addition, we expect to invest in sales and marketing to broaden our reach with new clients in the U.S. and abroad, and to deepen our penetration with existing clients. With our revenue growth objectives, we expect to continue to make such investments for the foreseeable future. We intend to continue to gradually increase our general and administrative spending to support our growing operational needs.
We have a track record of successfully identifying, acquiring, and integrating complementary businesses within the accounting, consulting, investment banking, legal, private capital and real assets industries. To complement our organic investment in innovation and accelerate our growth, we will continue to evaluate acquisition opportunities that help us extend our platform, broaden and deepen our market leadership, and add new clients.
Key Business Metrics
We review a number of operating and financial metrics, including the following key metrics, to help us evaluate our business, measure our performance and the effectiveness of our sales and marketing efforts, identify trends affecting our business, formulate business plans and budgets, and make strategic decisions.
Annual Recurring Revenues ("ARR")
ARR represents the annualized recurring value of all active SaaS and on-premise license contracts at the end of a reporting period. Contracts with a term other than one year are annualized by taking the committed contract value for the current period divided by number of days in that period then multiplying by 365. As a metric, ARR mitigates fluctuations in revenue recognition due to certain factors, including contract term and the sales mix of SaaS contracts and licenses. ARR does not have any standardized meaning and may not be comparable to similarly titled measures presented by other companies. ARR should be viewed independently of revenues and deferred revenues and is not intended to be combined with or to replace either of those elements of our financial statements. ARR is not a forecast and the active contracts at the end of a reporting period used in calculating ARR may or may not be extended or renewed by our clients.
ARR was $590.5 million and $485.4 million as of June 30, 2026 and 2025, respectively, an increase of 22%.
Cloud ARR
Cloud ARR is the portion of our ARR which represents the annualized recurring value of our active SaaS contracts. We believe Cloud ARR provides important information about our ability to sell new SaaS subscriptions to existing clients and to acquire new SaaS clients.
Cloud ARR was $495.7 million and $383.1 million as of June 30, 2026 and 2025, respectively, an increase of 29%, and represented 84% and 79% of ARR for fiscal years 2026 and 2025, respectively.
Cloud Net Revenue Retention ("NRR")
Cloud NRR is the portion of our NRR which represents the net revenue retention of our SaaS contracts. We calculate Cloud NRR by starting with the Cloud ARR from the cohort of all clients as of the twelve months prior to the applicable fiscal period, or prior period Cloud ARR. We then calculate the Cloud ARR from these same clients as of the current fiscal period, or current period Cloud ARR. We then divide the current period Cloud ARR by the prior period Cloud ARR to calculate the Cloud NRR.
This metric accounts for changes in our cloud recurring revenue base from cross-sell (additional solution capabilities sold), upsell (additional seats sold), cloud migrations, price changes, and client attrition (including contraction of solution capabilities, contraction of seats and client churn). Our trailing twelve months Cloud NRR as of June 30, 2026 was 123%.
Number of Clients
Our client base includes some of the largest and most reputable accounting, consulting, investment banking, legal, private capital and real assets firms globally. These clients have the financial and operating resources needed to purchase, deploy, and successfully use the full capabilities of our software platform, and as such, we believe our ability to increase the number of enterprise clients on our platform is a key indicator of the growth of our business and our future business opportunities. We define an enterprise client at the end of any reporting period as an entity with at least one active subscription as of the measurement date with contracts greater than $50,000 of ARR. We believe the number of our enterprise clients with contracts greater than $50,000 of ARR and the number of our enterprise clients with contracts greater than $100,000 of ARR are important metrics for highlighting our progress on the path to full adoption of our platform by our accounting, consulting, investment banking, legal, private capital and real assets clients. As of June 30, 2026 and 2025, we had more than 1,400 and 1,275 enterprise clients, respectively, with contracts greater than $50,000 of ARR, representing a 10% increase. As of June 30, 2026 and 2025, we had 897 and 795 enterprise clients, respectively, with contracts greater than $100,000 of ARR, representing a 13% increase. As of June 30, 2026 and 2025, we had 142 and 109 enterprise clients, respectively, with contracts greater than $1.0 million of ARR, representing a 30% increase. No single client represented more than 10% of total revenues for fiscal years 2026, 2025, and 2024, respectively.
With our scalable, modular cloud-based platform, we believe we are well positioned to continue our growth. Our most significant opportunity lies with the largest firms, where we see substantial expansion potential as firms continue to consolidate. We pursue growth in the number of enterprise clients greater than $50,000 and $100,000 of ARR, but our biggest drivers are the assets under management and revenue growth of our clients as well as growth in the total number of professionals they employ.
Components of Our Results of Operations
Revenues
We generate revenues from the sale of our SaaS solutions and premium support services related to SaaS, and subscriptions to our term software applications and support services related to licenses. We generate professional services revenues primarily by delivering professional services for the configuration, implementation and upgrade of our solutions.
SaaS
SaaS revenues include subscription fees from clients accessing our SaaS solutions, premium support services related to SaaS, and updates, if any, to the subscribed service during the subscription term. We recognize SaaS revenues ratably over the contract term beginning on the commencement date of each contract, which is the date when the service is provisioned and made available to our clients. The initial term of our SaaS contracts is generally one to three years in duration.
License
License revenues include subscription fees from providing clients with the right to functional intellectual property where clients can benefit from the subscription licenses on their own and support services related to the licenses, which entitles clients to receive technical support and software updates, on a when and if available basis. We recognize license revenues related to subscription fees at a point in time when control of our term software application is transferred to the client, which generally occurs at the time of delivery or upon commencement of the renewal term. License fees are generally payable in advance on an annual basis over the term of the license arrangement, which is typically non-cancelable. We recognize license revenues related to support ratably over the term of the support contract which corresponds to the underlying license agreement. We expect to continue to generate a relatively consistent stream of license revenues from our existing license clients. From time to time, there may be cumulative catch ups in revenue as a result of compliance uplift contracts. However, over time as we focus on new sales of our SaaS solutions and encourage existing license clients to migrate to SaaS solutions, we expect revenues from license to decrease as a percentage of total revenues.
Professional Services
Our professional services primarily consist of implementation, configuration and upgrade services provided to clients and others. These engagements are billed to clients either on a time and materials or milestone basis; revenues are recognized as invoiced or in proportion to the work performed, respectively. We expect the demand for our professional services to remain relatively flat, with modest increases due to client growth and the need for implementation, upgrade, and migration services for new and existing clients. This demand will be affected by the mix of professional services that are provided by us versus provided by our third-party implementation partners, reflecting our strategy to de-emphasize professional services revenue. This shift will enhance partner involvement, support co-selling efforts, and drive partner-led deal origination.
Cost of Revenues
Our cost of revenues consists primarily of expenses related to providing SaaS solutions, premium support services related to SaaS, support services related to license and professional services to our clients, including personnel costs (salaries, bonuses, benefits and stock-based compensation) and related expenses for client support and services personnel, as well as cloud infrastructure costs, third-party expenses, depreciation of fixed assets, amortization of capitalized internal-use software costs and acquired intangible assets, and allocated overhead costs. We expect our cost of revenues to increase in absolute dollars as we expand our SaaS client base over time as this will result in increased cloud infrastructure costs and increased costs for additional personnel to provide technical support services to our growing client base.
Cost of SaaS
Our cost of SaaS revenues comprises the direct costs to deliver and support our SaaS solutions and premium support services related to SaaS, including personnel costs, allocated overhead costs, third-party hosting fees related to cloud infrastructure, amortization of capitalized internal-use software costs, amortization of acquired intangible assets, and depreciation of fixed assets. We expect the cost of SaaS revenues to increase in absolute dollars as we continue to increase usage of third-party hosting and AI product costs to support our growing client base.
Cost of License
Our cost of license revenues comprises the direct costs to support our license, including personnel costs, and allocated overhead costs.
Cost of Professional Services
Our cost of professional services revenues comprises the personnel-related costs for our professional services employees and contractors responsible for delivering implementation, upgrade and migration services to our clients. This includes personnel costs and allocated overhead costs. We expect the cost of professional services revenues to increase in absolute dollars as we continue to hire personnel and engage contractors to provide implementation, upgrade and migration services to our growing client base.
Operating Expenses
Research and Development
Our research and development expenses consist primarily of personnel costs for engineering and product development employees, costs of third-party services, cloud infrastructure costs and allocated overhead costs. We expect our research and development expenses to continue to increase in absolute dollars for the foreseeable future as we continue to dedicate substantial internal resources to develop, improve and expand the functionality of our solutions.
Sales and Marketing
Our sales and marketing expenses consist primarily of costs incurred for personnel costs for our sales and marketing employees as well as sales commissions and benefits, costs of marketing events and online advertising, allocated overhead costs, and travel and entertainment expenses. We capitalize client acquisition costs (principally commissions paid to sales personnel) and subsequently amortize these costs over the expected period of benefits. In the medium term, we expect to see an increase in sales and marketing expenses as we continue to expand our direct sales force to take advantage of opportunities for growth and increase in in-person meetings, conferences, and attendance at trade shows, as we accelerate delivery of AI-powered solutions, including Intapp Celeste. Over the longer term, we expect sales and marketing expenses to decrease as a percentage of revenue.
General and Administrative
Our general and administrative expenses consist primarily of personnel costs as well as professional services and facilities costs related to our executive, finance, human resources, information technology and legal functions. As a public company, we expect to continue to incur significant accounting and legal costs related to compliance with rules and regulations enacted by the SEC, including the costs of maintaining compliance with the Sarbanes-Oxley Act, as well as insurance, investor relations and other costs associated with being a public company. In the medium term, we expect general and administrative expenses may decrease as a percentage of revenues as we continue to invest in various process efficiency initiatives.
Interest and Other Income, Net
Interest and other income, net consists primarily of interest income from our cash and cash equivalents, gains and losses from foreign currency transactions and remeasurement, and non-cash interest expense related to the amortization of deferred financing costs.
Income Tax Expense
Our income tax expense consists of an estimate of federal, state, and foreign income taxes based on enacted federal, state, and foreign tax rates, as adjusted for allowable credits, deductions, uncertain tax positions, changes in the valuation of our deferred tax assets and liabilities, and changes in tax laws. We maintain a full valuation allowance on our federal and state deferred tax assets as we have concluded that it is more likely than not that the deferred tax assets will not be realized.
Results of Operations
The following tables set forth our results of operations for the periods presented, expressed in total U.S. dollar terms and as a percentage of our total revenues:
| Year Ended June 30, | |||||||||||||||||||||||||||||||||||
| 2026 | 2025 | 2024 | |||||||||||||||||||||||||||||||||
| (in thousands, except for percentages) | |||||||||||||||||||||||||||||||||||
|
Revenues:
|
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| SaaS | $ | 422,803 | 73 | % | $ | 331,948 | 66 | % | $ | 259,256 | 60 | % | |||||||||||||||||||||||
| License | 103,362 | 18 | 120,024 | 24 | 117,386 | 27 | |||||||||||||||||||||||||||||
| Professional services | 51,640 | 9 | 52,148 | 10 | 53,881 | 13 | |||||||||||||||||||||||||||||
| Total revenues | 577,805 | 100 | 504,120 | 100 | 430,523 | 100 | |||||||||||||||||||||||||||||
|
Cost of revenues (1):
|
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| SaaS | 74,383 | 13 | 66,714 | 13 | 53,487 | 13 | |||||||||||||||||||||||||||||
| License | 5,807 | 1 | 6,256 | 1 | 6,344 | 1 | |||||||||||||||||||||||||||||
| Professional services | 59,765 | 10 | 58,178 | 12 | 63,830 | 15 | |||||||||||||||||||||||||||||
| Total cost of revenues | 139,955 | 24 | 131,148 | 26 | 123,661 | 29 | |||||||||||||||||||||||||||||
| Gross profit | 437,850 | 76 | 372,972 | 74 | 306,862 | 71 | |||||||||||||||||||||||||||||
|
Operating expenses (1):
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| Research and development | 167,315 | 29 | 137,760 | 27 | 113,634 | 27 | |||||||||||||||||||||||||||||
| Sales and marketing | 199,382 | 35 | 163,846 | 33 | 138,176 | 32 | |||||||||||||||||||||||||||||
| General and administrative | 111,250 | 19 | 98,723 | 19 | 87,243 | 20 | |||||||||||||||||||||||||||||
| Total operating expenses | 477,947 | 83 | 400,329 | 79 | 339,053 | 79 | |||||||||||||||||||||||||||||
| Operating loss | (40,097) | (7) | (27,357) | (5) | (32,191) | (8) | |||||||||||||||||||||||||||||
|
Interest and other income, net
|
2,861 | 1 | 11,219 | 2 | 2,285 | 1 | |||||||||||||||||||||||||||||
| Net loss before income taxes | (37,236) | (6) | (16,138) | (3) | (29,906) | (7) | |||||||||||||||||||||||||||||
|
Income tax expense
|
(4,074) | (1) | (2,079) | (1) | (2,115) | - | |||||||||||||||||||||||||||||
| Net loss | $ | (41,310) | (7) | % | $ | (18,217) | (4) | % | $ | (32,021) | (7) | % | |||||||||||||||||||||||
|
(1)Amounts include stock-based compensation expense as follows:
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| Year Ended June 30, | |||||||||||||||||||||||||||||||||||
| 2026 | 2025 | 2024 | |||||||||||||||||||||||||||||||||
| Cost of SaaS | $ | 3,814 | 1 | % | $ | 3,174 | 1 | % | $ | 1,740 | 1 | % | |||||||||||||||||||||||
| Cost of license | 706 | - | 709 | - | 552 | - | |||||||||||||||||||||||||||||
| Cost of professional services | 5,032 | 1 | 6,026 | 1 | 5,030 | 1 | |||||||||||||||||||||||||||||
| Research and development | 36,281 | 6 | 24,309 | 5 | 14,854 | 3 | |||||||||||||||||||||||||||||
| Sales and marketing | 35,641 | 6 | 24,557 | 5 | 17,312 | 4 | |||||||||||||||||||||||||||||
| General and administrative | 38,509 | 7 | 29,311 | 5 | 20,407 | 5 | |||||||||||||||||||||||||||||
| Total stock-based compensation expense | $ | 119,983 | 21 | % | $ | 88,086 | 17 | % | $ | 59,895 | 14 | % | |||||||||||||||||||||||
Comparison of the Fiscal Years Ended June 30, 2026 and 2025
Revenues
| Year Ended June 30, | Change | ||||||||||||||||||||||
| 2026 | 2025 | Amount | % | ||||||||||||||||||||
| (in thousands, except for percentages) | |||||||||||||||||||||||
| Revenues: | |||||||||||||||||||||||
| SaaS | $ | 422,803 | $ | 331,948 | $ | 90,855 | 27 | % | |||||||||||||||
| License | 103,362 | 120,024 | (16,662) | (14) | % | ||||||||||||||||||
| Professional services | 51,640 | 52,148 | (508) | (1) | % | ||||||||||||||||||
| Total revenues | $ | 577,805 | $ | 504,120 | $ | 73,685 | 15 | % | |||||||||||||||
SaaS
SaaS revenues increased by $90.9 million, or 27%, in fiscal year 2026 compared to fiscal year 2025, due to sales to new clients and expansion of existing clients from both cross-selling and upselling sales motions. The continuation of clients migrating from using our license solutions to our cloud solutions also contributed to the growth.
License
License revenues decreased by $16.7 million, or 14%, for fiscal year 2026 compared to fiscal year 2025, due to clients migrating to our SaaS solutions.
Professional Services
Professional services revenues remained relatively flat in fiscal year 2026 compared to fiscal year 2025, due to changes in mix of resource delivery to our third-party implementation partners.
Cost of Revenues and Gross Profit
| Year Ended June 30, | Change | ||||||||||||||||||||||
| 2026 | 2025 | Amount | % | ||||||||||||||||||||
| (in thousands, except for percentages) | |||||||||||||||||||||||
| Cost of revenues: | |||||||||||||||||||||||
| SaaS | $ | 74,383 | $ | 66,714 | $ | 7,669 | 11 | % | |||||||||||||||
| License | 5,807 | 6,256 | (449) | (7) | % | ||||||||||||||||||
| Professional services | 59,765 | 58,178 | 1,587 | 3 | % | ||||||||||||||||||
| Total cost of revenues | $ | 139,955 | $ | 131,148 | $ | 8,807 | 7 | % | |||||||||||||||
| Gross profit: | |||||||||||||||||||||||
| SaaS | $ | 348,420 | $ | 265,234 | $ | 83,186 | 31 | % | |||||||||||||||
| License | 97,555 | 113,768 | (16,213) | (14) | % | ||||||||||||||||||
| Professional services | (8,125) | (6,030) | (2,095) | 35 | % | ||||||||||||||||||
| Gross profit | $ | 437,850 | $ | 372,972 | $ | 64,878 | 17 | % | |||||||||||||||
Cost of SaaS
Cost of SaaS revenues increased by $7.7 million, or 11%, for fiscal year 2026 compared to fiscal year 2025. This was primarily driven by increases in cloud hosting costs of $3.0 million, royalty expense of $2.2 million, amortization of acquired intangible assets costs of $0.7 million, and stock-based compensation expense of $0.6 million due to an increase in stock awards granted.
Cost of License
Cost of license revenues remained relatively flat for fiscal year 2026 compared to fiscal year 2025.
Cost of Professional Services
Cost of professional services revenues increased by $1.6 million, or 3%, for fiscal year 2026 compared to fiscal year 2025, primarily driven by contractor costs of $1.4 million and an increase in personnel-related cost of $1.1 million due to annual salary increase, offset by a decrease in stock-based compensation expense of $1.0 million.
Gross Profit
Gross profit increased by $64.9 million, or 17% for fiscal year 2026 compared to fiscal year 2025. Of this increase, $83.2 million was attributable to growth in SaaS revenues and a lower increase in SaaS costs as a percentage of related revenues. The increase was partially offset by a $16.2 million increase in license revenues and related costs and $2.1 million increase in professional services costs with lower related revenues, as we continue to provide implementation, upgrade and migration services to our growing client base, consistent with our strategy to de-emphasize professional services revenues.
Operating Expenses
| Year Ended June 30, | Change | ||||||||||||||||||||||
| 2026 | 2025 | Amount | % | ||||||||||||||||||||
| (in thousands, except for percentages) | |||||||||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||
| Research and development | $ | 167,315 | $ | 137,760 | $ | 29,555 | 21 | % | |||||||||||||||
| Sales and marketing | 199,382 | 163,846 | 35,536 | 22 | % | ||||||||||||||||||
| General and administrative | 111,250 | 98,723 | 12,527 | 13 | % | ||||||||||||||||||
| Total operating expenses | $ | 477,947 | $ | 400,329 | $ | 77,618 | 19 | % | |||||||||||||||
Research and Development
Research and development expenses increased by $29.6 million, or 21%, for fiscal year 2026 compared to fiscal year 2025. This was primarily driven by an increase in stock-based compensation expense of $12.0 million due to an increase in stock awards granted, personnel-related costs of $5.6 million due to annual salary and headcount increases, restructuring costs of $5.3 million, deferred consideration accruals of $3.3 million related to prior acquisitions, and allocated overhead costs of $1.5 million driven by increases in facilities and IT expenses.
Sales and Marketing
Sales and marketing expenses increased by $35.5 million, or 22%, for fiscal year 2026 compared to fiscal year 2025. This was primarily driven by increases in personnel-related costs of $14.7 million due to annual salary and headcount increases, stock-based compensation expense of $11.1 million primarily due to an increase in stock awards granted, commissions expense of $4.8 million due to sales increases, marketing events and travel related expenses of $2.5 million, and deferred consideration accruals of $2.5 million related to prior acquisitions, and allocated overhead costs of $1.3 million driven by increases in facilities and IT expenses, partially offset by a decrease in contractor cost of $1.5 million.
General and Administrative
General and administrative expense increased by $12.5 million, or 13%, for fiscal year 2026 compared to fiscal year 2025. This was primarily driven by increases in stock-based compensation expense of $9.2 million due to an increase in stock awards granted, personnel-related costs of $3.4 million primarily due to annual salary and headcount increases, and impairment charges of $2.6 million, consisting of $1.4 million related to cloud computing implementation costs associated with a digital transformation initiative and $1.2 million related to certain intangible assets in connection with a strategic rebranding initiative, partially offset by a decrease in professional services and discretionary costs of $3.4 million.
Interest and Other Income, Net
| Year Ended June 30, | Change | ||||||||||||||||||||||
| 2026 | 2025 | Amount | % | ||||||||||||||||||||
| (in thousands, except for percentages) | |||||||||||||||||||||||
| Interest and other income, net | $ | 2,861 | $ | 11,219 | $ | (8,358) | (74) | % | |||||||||||||||
Interest and other income, net, decreased by $8.4 million, or 74%, for fiscal year 2026 compared to fiscal year 2025. This was primarily driven by a $5.2 million change from foreign currency transactions and remeasurement, a $2.4 million decrease in interest income as our cash held in money market funds decreased, and a $0.8 million loss due to foreign currency impact from dissolution of a subsidiary.
Income Tax Expense
| Year Ended June 30, | Change | ||||||||||||||||||||||
| 2026 | 2025 | Amount | % | ||||||||||||||||||||
| (in thousands, except for percentages) | |||||||||||||||||||||||
| Income tax expense | $ | (4,074) | $ | (2,079) | $ | (1,995) | 96 | % | |||||||||||||||
Income tax expense was $4.1 million and $2.1 million for fiscal year 2026 and 2025, respectively. The change in our income tax expense was primarily due to an increase in current taxes in foreign and U.S. state jurisdictions. The income tax expense for fiscal years 2026 and 2025 is primarily attributable to current taxes for U.S. state and foreign jurisdictions, respectively.
Liquidity and Capital Resources
Sources and Uses of Liquidity
As of June 30, 2026, we had cash and cash equivalents of $162.8 million. We finance our liquidity needs primarily through collections from clients, where we generally bill and collect from our clients annually in advance. Our billings are subject to seasonality with billings in the fourth quarter higher than in the other quarters.
Operating losses could continue in the future as we continue to invest in the growth of our business. We believe our existing cash and cash equivalents as of June 30, 2026, along with our UBS Revolving Credit Facility described below, will be sufficient to meet our working capital, capital expenditure, and stock repurchase needs for the next twelve months and beyond.
On October 5, 2021, we entered into a Credit Agreement, as amended on June 6, 2022 and further amended on November 17, 2022, with a group of lenders led by JPMorgan (the "JPMorgan Credit Agreement"). The JPMorgan Credit Agreement provided for a five-year, senior secured revolving credit facility of $100.0 million with a subfacility for letters of credit in the aggregate amount of up to $10.0 million (the "JPMorgan Credit Facility"). As of June 30, 2026, no amounts had been borrowed under the JPMorgan Credit Facility. For further information refer to Note 11. "Debt" in our consolidated financial statements included elsewhere in this Annual Report on Form 10-K.
On July 7, 2026, the Company entered into a Credit Agreement, (the "UBS Credit Agreement") among the Company, the guarantors party thereto, the lenders party thereto and UBS AG, Stamford Branch, as Administrative Agent ("UBS"). The UBS Credit Agreement provides for a five-year, senior secured revolving credit facility of $150 million with a subfacility for letters of credit in the aggregate amount of up to $10 million (the "UBS Revolving Credit Facility"). Concurrently with our entry into the UBS Credit Agreement, we terminated the JPMorgan Credit Agreement. For further information, refer to Note 18. "Subsequent Event" in our consolidated financial statements included elsewhere in this Annual Report on Form 10-K.
Our primary uses of cash include personnel-related expenses, third-party cloud infrastructure expenses, research and development, sales and marketing expenses, overhead costs and acquisitions we may make from time to time. Our future capital requirements will depend on many factors, including, but not limited to, our ability to grow our revenues and the timing and extent of investment across our organization necessary to support growth in our business. In addition, we may in the future enter into arrangements to acquire or invest in complementary businesses or technologies. We may need to seek additional equity or debt financing in order to meet these future capital requirements. If we are unable to raise additional capital when desired, or on terms that are acceptable to us, our business, financial condition and results of operations could be adversely affected.
Cash Flows
The following table summarizes our cash flows from operating, investing, and financing activities for the periods presented (in thousands):
| Year Ended June 30, | |||||||||||||||||
| 2026 | 2025 | 2024 | |||||||||||||||
| Net cash provided by operating activities | $ | 146,847 | $ | 123,529 | $ | 67,231 | |||||||||||
| Net cash used in investing activities | (13,482) | (62,875) | (19,828) | ||||||||||||||
|
Net cash (used in) provided by financing activities
|
(282,733) | 41,183 | 30,325 | ||||||||||||||
| Effect of foreign currency exchange rate changes on cash and cash equivalents | (928) | 2,902 | (343) | ||||||||||||||
|
Net (decrease) increase in cash, cash equivalents and restricted cash
|
$ | (150,296) | $ | 104,739 | $ | 77,385 | |||||||||||
Operating Activities
During fiscal year 2026, net cash provided by operating activities was $146.8 million, as our net loss of $41.3 million was reduced by $188.2 million of adjustments. These adjustments consisted of $148.0 million of non-cash charges (principally comprising of stock-based compensation, depreciation and amortization and amortization of operating lease right-of-use assets) and a net cash inflow of $40.1 million from net changes in operating assets and liabilities. The net cash inflow from changes in operating assets and liabilities was primarily driven by an increase in deferred revenues of $58.7 million due to our revenue growth and the timing of invoicing, a decrease in unbilled receivables of $8.8 million due to the timing of invoicing to our clients and an increase in other liabilities of $7.6 million due to the timing of payments. These changes were partially offset by an increase in accounts receivable of $13.5 million due to the timing of billing and collections on our outstanding receivables, an increase in deferred commissions of $9.7 million due to increased sales, a decrease in operating lease liabilities of $7.4 million due to lease payments, a decrease in accounts payable and accrued liabilities of $4.3 million due to the timing of payments and an increase in prepaid expenses and other assets of $0.1 million.
During fiscal year 2025, net cash provided by operating activities was $123.5 million, as our net loss of $18.2 million was reduced by $141.7 million of adjustments. These adjustments consisted of $112.5 million of non-cash charges (principally comprising of stock-based compensation, depreciation and amortization and amortization of operating lease right-of-use assets) and a net cash inflow of $29.2 million from net changes in operating assets and liabilities. The net cash inflow from changes in operating assets and liabilities was primarily driven by an increase in deferred revenues of $35.3 million due to our revenue growth and the timing of invoicing, an increase in accounts payable and accrued liabilities of $13.5 million due to an increase in accrued bonuses and timing of payments, an increase in other liabilities of $2.2 million due to the timing of payments and a decrease in accounts receivable of $1.2 million due to the timing of billing and collections on our outstanding receivables. These changes were partially offset by an increase in prepaid expenses and other assets of $8.0 million, an increase in unbilled receivables of $6.2 million due to the timing of invoicing to our clients, a decrease in operating lease liabilities of $5.1 million due to lease payments and an increase in deferred commissions of $3.7 million due to increased sales.
Investing Activities
During fiscal year 2026, net cash used in investing activities was $13.5 million, consisting of $8.3 million capitalized internal-use software costs, $3.0 million purchase of strategic investments, and $2.1 million capital expenditures on property and equipment primarily comprised of computer equipment and leasehold improvements.
During fiscal year 2025, net cash used in investing activities was $62.9 million, consisting of $50.9 million cash consideration paid, net of cash acquired for the acquisition of TermSheet, LLC ("TermSheet"), $7.4 million capitalized internal-use software costs, $2.0 million purchase of strategic investments, $1.7 million capital expenditures on property and equipment primarily comprised of computer equipment and leasehold improvements and $0.9 million working capital adjustment related to a prior acquisition.
Financing Activities
During fiscal year 2026, net cash used in financing activities was $282.7 million, primarily comprised of $275.2 million in payments for the repurchases of common stock, including broker fees, $20.3 million of payments related to employee payroll tax withholding on vested equity awards and $1.7 million in payments for contingent consideration and holdbacks related to prior acquisitions, partially offset by $10.4 million of proceeds from stock option exercises and $4.0 million of proceeds from employee stock purchase plan.
During fiscal year 2025, net cash provided by financing activities was $41.2 million, primarily comprised of $40.8 million of proceeds from stock option exercises and $4.1 million of proceeds from employee stock purchase plan, partially offset by $3.7 million in payments for contingent consideration and holdbacks related to prior acquisitions.
Stock Repurchase Program
On August 7, 2025, our Board of Directors authorized a common stock repurchase program of up to $150.0 million. During the fiscal year ended June 30, 2026, we have repurchased $150.0 million, excluding broker fees, of our common stock under this program and no funds remain available for repurchase under this repurchase authorization limit. The repurchased shares of common stock were retired.
On January 29, 2026, our Board of Directors authorized a new common stock repurchase program of up to $200.0 million. During the fiscal year ended June 30, 2026, we repurchased $125.0 million, excluding broker fees, of our common stock under this program and $75.0 million remains available for repurchase under this repurchase authorization limit. The repurchased shares of common stock were retired.
For further information refer to Note 15. "Stockholders' Equity" to our condensed consolidated financial statements.
Material Cash Commitments
Our material cash commitments as of June 30, 2026 were as follows (in thousands):
| Total | Short-Term | Long-Term | |||||||||||||||
| Operating lease obligations | $ | 25,401 | $ | 8,216 | $ | 17,185 | |||||||||||
| Purchase obligations | 69,183 | 6,536 | 62,647 | ||||||||||||||
| Deferred considerations and acquisition holdbacks | 13,013 | - | 13,013 | ||||||||||||||
| Total cash requirements | $ | 107,597 | $ | 14,752 | $ | 92,845 | |||||||||||
Operating lease obligations consist of obligations under non-cancelable operating leases for office space with expiration through June 2030. For further information refer to Note 9. "Leases" in our consolidated financial statements included elsewhere in this Annual Report on Form 10-K.
Purchase obligations primarily consist of third-party cloud infrastructure and support services and software subscriptions. For further information refer to Note 10. "Commitments and Contingencies" in our consolidated financial statements included elsewhere in this Annual Report on Form 10-K.
In connection with the acquisition of TermSheet, we are obligated to make cash payments of up to $15.0 million over the next two fiscal years, subject to certain performance measures and in some cases, certain service conditions. For further information, refer to Note 4. "Business Combinations" in our consolidated financial statements included elsewhere in this Annual Report on Form 10-K. For further information, refer to Note 6. "Fair Value Measurements" in our consolidated financial statements included elsewhere in this Annual Report on Form 10-K.
Indebtedness
On October 5, 2021, we entered into the JPMorgan Credit Agreement, as amended on June 6, 2022 and further amended on November 17, 2022, with a group of lenders led by JPMorgan. The JPMorgan Credit Agreement provided for a five-year, senior secured revolving credit facility of $100.0 million with a subfacility for letters of credit in the aggregate amount of up to $10.0 million. We were in compliance with all of the covenants as of June 30, 2026. As of June 30, 2026, there were no outstanding borrowings under the JPMorgan Credit Facility.
Subsequent to fiscal year 2026, we entered into the UBS Credit Agreement on July 7, 2026 and concurrently terminated the JPMorgan Credit Agreement. For further information, refer to Note 11. "Debt" and Note 18. "Subsequent Event" in our consolidated financial statements included elsewhere in this Annual Report on Form 10-K.
Critical Accounting Policies and Estimates
The process of preparing our consolidated financial statements in conformity with generally accepted accounting principles in the United States of America ("GAAP") requires the use of estimates and judgments that affect the reported amounts of assets, liabilities, revenues, and expenses. These estimates and judgments are based on historical experience, future expectations and other factors and assumptions we believe to be reasonable under the circumstances. The most significant estimates and judgments are reviewed on an ongoing basis and are revised when necessary. Actual amounts may differ from these estimates and judgments.
A summary of our significant accounting policies is contained in Note 2. "Summary of Significant Accounting Policies" in our consolidated financial statements included elsewhere in this Annual Report on Form 10-K.
Revenue Recognition
Revenue recognition requires judgment and the use of estimates, especially in identifying and evaluating the various non-standard terms and conditions in our contracts with clients and their effect on reported revenues.
We generate revenues from the sale of our SaaS solutions and premium support services related to SaaS, and subscriptions to our term software applications and support services related to licenses. We generate professional services revenues primarily by delivering professional services for the configuration, implementation and upgrade of our solutions.
The estimates and assumptions requiring significant judgment under our revenue recognition policy are as follows:
Identification of the performance obligations
The majority of our contracts contain multiple performance obligations (such as when subscription licenses are sold with support and implementation services) and are typically capable of being distinct and accounted for as separate performance obligations.
Determination of the transaction price
We determine the transaction price based on the consideration to which we expect to be entitled in exchange for transferring our services and products to the client. We estimate variable consideration included in the transaction price if, in our judgment, it is probable that no significant future reversal of cumulative revenues under the contract will occur.
In instances where the timing of revenue recognition differs from the timing of invoicing, we have determined that contracts generally do not include a significant financing component.
Allocation of the transaction price to the performance obligations in the contract
If the contract contains a single performance obligation, we allocate the entire transaction price to the single performance obligation. Contracts that contain multiple performance obligations require an allocation of the transaction price to each performance obligation based on its relative standalone selling price ("SSP"). The determination of SSP involves judgment and is generally based on the contractually stated, observable prices of the promised goods and services charged when sold separately to client. In a contract with multiple performance obligations, we allocate revenues to each performance obligation at the inception of the contract. Some of our performance obligations have observable inputs that are used to determine the SSP of those distinct performance obligations. Where SSP is not directly observable, we determine the SSP using information that may include market conditions and other observable inputs.
Stock-Based Compensation
The fair value of restricted stock units ("RSUs") and performance-based stock units ("PSUs") is based on the closing price of our common stock on the date of the grant. We recognize stock-based compensation expense for RSUs over the requisite service period, which is generally four years. We recognize stock-based compensation expense for PSUs in the period in which it becomes probable that the performance target will be achieved, using the graded vesting method. At each reporting period, we reassess the probability of achievement of the performance conditions and any change in expense resulting from an adjustment to estimates is treated as a cumulative catch-up in the period of the adjustment.
Recent Accounting Pronouncements
See Note 2. "Summary of Significant Accounting Policies" in our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for more information regarding recent accounting pronouncements and our assessment of their impact.
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