yext-20241031

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended October 31, 2024


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-38056

YEXT, INC.

(Exact name of registrant as specified in its charter)


Delaware						20-8059722
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

61 Ninth Avenue

New York, NY 10011

(Address of principal executive offices, including zip code)

(212) 994-3900

(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, par value $0.001 per share

YEXT

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Securities Exchange Act). Yes ☐ No ☒

As of November 25, 2024, the registrant had 127,621,329 shares of common stock, $0.001 par value per share outstanding.

TABLE OF CONTENTS


			PAGE
PART I.		FINANCIAL INFORMATION
	Item 1	Financial Statements	5
		Condensed Consolidated Balance Sheets (U naudited)	5
		Condensed Consolidated Statements of Operations and Comprehensive Loss (U naudited)	6
		Condensed Consolidated Statements of Stockholders' Equity (U naudited)	7
		Condensed Consolidated Statements of Cash Flows (U naudited)	9
		Notes to Condensed Consolidated Financial Statements	10
	Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	24
	Item 3	Quantitative and Qualitative Disclosures About Market Risk	37
	Item 4	Controls and Procedures	38

PART II.		OTHER INFORMATION
	Item 1	Legal Proceedings	39
	Item 1A	Risk Factors	39
	Item 2	Unregistered Sales of Equity Securities and Use of Proceeds	65
	Item 3	Defaults Upon Senior Securities	65
	Item 4	Mine Safety Disclosures	65
	Item 5	Other Information	65
	Item 6	Exhibits	66

SIGNATURES

SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains, and our officers and representatives may from time to time make, forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which statements involve substantial risks and uncertainties. All statements contained in this Quarterly Report on Form 10-Q other than statements of historical fact, including statements regarding our future results of operations and financial position, our business strategy and plans, and our objectives for future operations, are forward-looking statements. The words “believe,” “may,” “will,” “potentially,” “estimate,” “continue,” “anticipate,” “plan,” “intend,” “could,” “would,” “expect,” “possible,” and similar expressions that convey uncertainty of future events or outcomes are intended to identify forward-looking statements. Forward-looking statements included in this Quarterly Report on Form 10-Q include, but are not limited to, statements regarding:

•our future revenue, cost of revenue, operating expenses and cash flows;

•anticipated trends, growth rates and challenges in our business and in the markets in which we operate;

•the effect of general macroeconomic conditions, including, but not limited to, the impact of foreign currency fluctuations, interest rates, inflation, recession risks and geopolitical events and shifts, on our business, operations, and financial results and the business and operations of our customers and potential customers;

•our beliefs, objectives and strategies for future operations, including plans to invest in international expansion, research and development, and our sales and marketing teams, and the impact of such investments on our operations;

•changes in management and anticipated effects thereof;

•effects of current and prospective acquisitions and the integration thereof, including that of our recent acquisition of Hearsay Social, Inc. (“Hearsay”);

•our ability to increase sales of our products;

•maintaining and expanding our end-customer base and our relationships with our Publisher Network; and

•sufficiency of cash to meet cash needs for at least the next 12 months.

We have based these forward-looking statements largely on our current expectations and projections about future events and trends that we believe may affect our financial condition, results of operations, business strategy, short-term and long-term business operations and objectives and financial needs. These forward-looking statements are subject to a number of risks, uncertainties and assumptions, including those described in Part II, Item 1A. “Risk Factors” in this Quarterly Report on Form 10-Q. Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for us to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. In light of these risks, uncertainties and assumptions, the forward-looking events and trends discussed in this Quarterly Report on Form 10-Q may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements.

In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this Quarterly Report on Form 10-Q, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain and investors are cautioned not to unduly rely upon these statements.

You should not rely upon forward-looking statements as predictions of future events. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee that the future results, performance, or events and circumstances reflected in the forward-looking statements will be achieved or occur. We undertake no obligation to revise or publicly release the results of any revision to these forward-looking statements, whether written or oral, except as required by law.

In this Quarterly Report on Form 10-Q, the words “we,” “us,” “our” and “Yext” refer to Yext, Inc. and its wholly owned subsidiaries, unless the context requires otherwise.

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

YEXT, INC.

Condensed Consolidated Balance Sheets

(In thousands, except share and per share data)

(Unaudited)


	October 31, 2024		January 31, 2024
Assets
Current assets:
Cash and cash equivalents	$	100,484	$	210,184
Restricted cash, current	11,671		—
Accounts receivable, net of allowances of $1,468 and $1,013, respectively	57,778		108,198
Prepaid expenses and other current assets	17,353		14,849
Costs to obtain revenue contracts, current	21,447		26,680
Total current assets	208,733		359,911

Property and equipment, net	42,246		48,542
Operating lease right-of-use assets	70,124		75,989
Restricted cash, non-current	5,850		—
Costs to obtain revenue contracts, non-current	11,649		16,710
Goodwill	105,020		4,478
Intangible assets, net	87,986		168
Other long term assets	8,735		3,012
Total assets	$	540,343	$	508,810
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable, accrued expenses and other current liabilities	$	62,111	$	38,766
Unearned revenue, current	160,855		212,210
Operating lease liabilities, current	18,380		16,798
Total current liabilities	241,346		267,774
Operating lease liabilities, non-current	80,293		89,562
Contingent consideration, non-current	40,107		—
Other long term liabilities	18,635		4,300
Total liabilities	380,381		361,636
Commitments and contingencies (Note 13)
Stockholders’ equity:
Preferred stock, $0.001 par value per share; 50,000,000 shares authorized at October 31, 2024 and January 31, 2024; zero shares issued and outstanding at October 31, 2024 and January 31, 2024	—		—
Common stock, $0.001 par value per share; 500,000,000 shares authorized at October 31, 2024 and January 31, 2024; 152,424,199 and 148,197,347 shares issued at October 31, 2024 and January 31, 2024, respectively; 128,010,487 and 124,867,093 shares outstanding at October 31, 2024 and January 31, 2024, respectively	152		148
Additional paid-in capital	983,358		942,622
Accumulated other comprehensive loss	(4,501)		(4,183)
Accumulated deficit	(699,845)		(679,172)
Treasury stock, at cost	(119,202)		(112,241)
Total stockholders’ equity	159,962		147,174
Total liabilities and stockholders’ equity	$	540,343	$	508,810

See the accompanying notes to the condensed consolidated financial statements.

YEXT, INC.

Condensed Consolidated Statements of Operations and Comprehensive Loss

(In thousands, except share and per share data)

(Unaudited)


	Three months ended October 31,				Nine months ended October 31,
	2024		2023		2024		2023
Revenue	$	113,989	$	101,164	$	307,866	$	303,215
Cost of revenue	26,247		22,066		70,086		65,809
Gross profit	87,742		79,098		237,780		237,406
Operating expenses:
Sales and marketing	43,667		45,355		128,878		136,942
Research and development	21,070		18,291		56,709		53,934
General and administrative	33,373		17,233		75,553		53,774
Total operating expenses	98,110		80,879		261,140		244,650
Loss from operations	(10,368)		(1,781)		(23,360)		(7,244)
Interest income	823		1,922		5,578		5,296
Interest expense	(222)		(173)		(738)		(334)
Other expense, net	(55)		(70)		(397)		(687)
Loss from operations before income taxes	(9,822)		(102)		(18,917)		(2,969)
Provision for income taxes	(2,977)		(366)		(1,756)		(1,348)
Net loss	$	(12,799)	$	(468)	$	(20,673)	$	(4,317)

Net loss per share attributable to common stockholders, basic and diluted	$	(0.10)	$	—	$	(0.16)	$	(0.03)

Weighted-average number of shares used in computing net loss per share attributable to common stockholders, basic and diluted	128,036,993		124,239,180		126,668,394		123,962,358


Other comprehensive (loss) income:
Foreign currency translation adjustment	$	(144)	$	(876)	$	(324)	$	(722)
Unrealized gain on marketable securities, net	2		16		6		4
Total comprehensive loss	$	(12,941)	$	(1,328)	$	(20,991)	$	(5,035)

See the accompanying notes to the condensed consolidated financial statements.

YEXT, INC.

Condensed Consolidated Statements of Stockholders' Equity

(In thousands)

(Unaudited)

Three Months Ended October 31, 2024


						Accumulated
				Additional		Other						Total
	Common Stock			Paid-In		Comprehensive		Accumulated		Treasury		Stockholders’
	Shares	Amount		Capital		Loss		Deficit		Stock		Equity









Balance, July 31, 2024	127,145	$	150	$	966,550	$	(4,359)	$	(687,046)	$	(112,492)	$	162,803
Exercise of stock options	63	—		346		—		—		—		346
Vested restricted stock units converted to common shares, net of shares withheld for employee taxes	1,550	2		2,371		—		—		—		2,373

Issuance of common stock under employee stock purchase plan	292	—		1,338		—		—		—		1,338
Stock-based compensation	—	—		12,753		—		—		—		12,753
Repurchase of common stock	(1,040)	—		—		—		—		(6,710)		(6,710)
Other comprehensive loss	—	—		—		(142)		—		—		(142)
Net loss	—	—		—		—		(12,799)		—		(12,799)
Balance, October 31, 2024	128,010	$	152	$	983,358	$	(4,501)	$	(699,845)	$	(119,202)	$	159,962

Three Months Ended October 31, 2023


							Accumulated
					Additional		Other						Total
	Common Stock		Paid-In		Comprehensive		Accumulated		Treasury		Stockholders’
		Shares	Amount		Capital		Loss		Deficit		Stock		Equity









Balance, July 31, 2023		124,654	$	146	$	923,094	$	(3,475)	$	(680,391)	$	(100,353)	$	139,021
Exercise of stock options		43	—		160		—		—		—		160
Vested restricted stock units converted to common shares, net of shares withheld for employee taxes		838	1		(2,969)		—		—		—		(2,968)

Issuance of common stock under employee stock purchase plan		290	—		1,552		—		—		—		1,552
Stock-based compensation		—	—		11,797		—		—		—		11,797
Repurchase of common stock		(1,755)	—		—		—		—		(11,888)		(11,888)
Other comprehensive loss		—	—		—		(860)		—		—		(860)
Net loss		—	—		—		—		(468)		—		(468)
Balance, October 31, 2023		124,070	$	147	$	933,634	$	(4,335)	$	(680,859)	$	(112,241)	$	136,346

See the accompanying notes to the condensed consolidated financial statements.

YEXT, INC.

Condensed Consolidated Statements of Stockholders' Equity

(In thousands)

(Unaudited)

Nine Months Ended October 31, 2024


						Accumulated
				Additional		Other						Total
	Common Stock			Paid-In		Comprehensive		Accumulated		Treasury		Stockholders’
	Shares	Amount		Capital		Loss		Deficit		Stock		Equity
Balance, January 31, 2024	124,867	$	148	$	942,622	$	(4,183)	$	(679,172)	$	(112,241)	$	147,174
Exercise of stock options	322	—		1,137		—		—		—		1,137
Vested restricted stock units converted to common shares, net of shares withheld for employee taxes	2,961	4		(1,417)		—		—		—		(1,413)
Issuance of restricted stock	138	—		—		—		—		—		—
Issuance of common stock under employee stock purchase plan	805	—		3,689		—		—		—		3,689
Stock-based compensation	—	—		37,327		—		—		—		37,327
Repurchase of common stock	(1,083)	—		—		—		—		(6,961)		(6,961)
Other comprehensive loss	—	—		—		(318)		—		—		(318)
Net loss	—	—		—		—		(20,673)		—		(20,673)
Balance, October 31, 2024	128,010	$	152	$	983,358	$	(4,501)	$	(699,845)	$	(119,202)	$	159,962

Nine Months Ended October 31, 2023


						Accumulated
				Additional		Other						Total
	Common Stock			Paid-In		Comprehensive		Accumulated		Treasury		Stockholders’
	Shares	Amount		Capital		Loss		Deficit		Stock		Equity
Balance, January 31, 2023	122,335	$	142	$	897,368	$	(3,617)	$	(676,542)	$	(89,328)	$	128,023
Exercise of stock options	1,557	1		8,742		—		—		—		8,743
Vested restricted stock units converted to common shares, net of shares withheld for employee taxes	2,302	3		(10,723)		—		—		—		(10,720)
Issuance of restricted stock	75	—		—		—		—		—		—
Issuance of common stock under employee stock purchase plan	782	1		3,671		—		—		—		3,672
Stock-based compensation	—	—		34,576		—		—		—		34,576
Repurchase of common stock	(2,981)	—		—		—		—		(22,913)		(22,913)
Other comprehensive loss	—	—		—		(718)		—		—		(718)
Net loss	—	—		—		—		(4,317)		—		(4,317)
Balance, October 31, 2023	124,070	$	147	$	933,634	$	(4,335)	$	(680,859)	$	(112,241)	$	136,346

See the accompanying notes to the condensed consolidated financial statements.

YEXT, INC.

Condensed Consolidated Statements of Cash Flows

(In thousands)

(Unaudited)


	Nine months ended October 31,
	2024		2023
Operating activities:
Net loss	$	(20,673)	$	(4,317)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization expense	12,101		12,625

Bad debt expense	1,017		589
Stock-based compensation expense	37,091		34,335







Amortization of operating lease right-of-use assets	6,471		6,739
Adjustments to contingent consideration	607		—
Other, net	(751)		351
Changes in operating assets and liabilities, net of assets acquired and liabilities assumed in a business acquisition:
Accounts receivable	55,285		57,251
Prepaid expenses and other current assets	(74)		(2,738)
Costs to obtain revenue contracts	10,476		9,054
Other long term assets	256		542
Accounts payable, accrued expenses and other current liabilities	7,181		(9,175)
Unearned revenue	(89,117)		(78,434)
Operating lease liabilities	(8,312)		(8,892)
Other long term liabilities	307		207
Net cash provided by operating activities	11,865		18,137
Investing activities:



Capital expenditures	(1,769)		(2,320)
Cash paid in acquisition, net of cash acquired	(89,407)		—
Net cash used in investing activities	(91,176)		(2,320)
Financing activities:



Proceeds from exercise of stock options	1,137		8,770
Repurchase of common stock	(6,760)		(23,086)

Payments for taxes related to net share settlement of stock-based compensation awards	(9,031)		(10,718)
Payments of deferred financing costs	(777)		(394)

Proceeds, net from employee stock purchase plan withholdings	2,218		2,546
Net cash used in financing activities	(13,213)		(22,882)
Effect of exchange rate changes on cash, cash equivalents and restricted cash	345		(993)
Net decrease in cash, cash equivalents and restricted cash	(92,179)		(8,058)
Cash, cash equivalents and restricted cash at beginning of period	210,184		190,214
Cash, cash equivalents and restricted cash at end of period	$	118,005	$	182,156

Supplemental reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated balance sheets:


	Nine months ended October 31,
(in thousands)	2024		2023
Cash and cash equivalents	$	100,484	$	182,156
Restricted cash, current and non-current	17,521		—
Total cash, cash equivalents and restricted cash	$	118,005	$	182,156

See the accompanying notes to the condensed consolidated financial statements.

YEXT, INC.

Notes to Condensed Consolidated Financial Statements

1. Organization and Description of Business

Description of Business

Yext, Inc. ("Yext" or the "Company") empowers businesses to manage their knowledge so they can deliver relevant, actionable answers to consumer questions as well as consistent, accurate and engaging experiences to customers throughout the digital ecosystem. The Company's digital presence platform (also known as the Answers Platform) lets businesses structure and organize information about their brands in the Company's knowledge graph, Yext Content (also known as the Knowledge Graph), which is then delivered across first- and third-party websites and applications through its network of over 200 service and application providers, which the Company refers to as its Publisher Network. The Company's platform powers all of the Company's key products, including Listings, Reviews, Pages, and Search, each with robust analytics capabilities for businesses to easily track performance across customer experiences.

In August 2024, the Company acquired Hearsay Social, Inc., a digital client engagement platform for financial services ("Hearsay"). See Note 4 "Business Combination" for additional information.

Fiscal Year

The Company's fiscal year ends on January 31st. References to fiscal 2025, for example, are to the fiscal year ending January 31, 2025.

2. Summary of Significant Accounting Policies

Basis of Presentation and Consolidation

The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") and applicable rules and regulations of the Securities and Exchange Commission ("SEC") regarding interim financial reporting. Certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. Therefore, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the Company's Annual Report on Form 10-K for the fiscal year ended January 31, 2024, filed with the SEC on March 13, 2024 (the "Form 10-K"). The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation.

The condensed consolidated balance sheet as of January 31, 2024, included herein, was derived from the audited financial statements as of that date, but does not include all disclosures including certain notes required by GAAP on an annual reporting basis.

In the opinion of management, the accompanying condensed consolidated financial statements reflect all normal recurring adjustments necessary to present fairly the financial position, results of operations, comprehensive loss and cash flows for the interim periods. The results for the nine months ended October 31, 2024 are not necessarily indicative of the results to be expected for any subsequent quarter, the fiscal year ending January 31, 2025, or any other period.

The following accounting policies should be read in conjunction with the Company's significant accounting policies as described in the Form 10-K.

Business Combinations

The Company accounts for business combinations using the acquisition method of accounting, which requires identifiable assets acquired and liabilities assumed in the acquiree, to be measured at their fair values, as of the acquisition date. Any excess of the consideration transferred over the fair value of the identifiable assets acquired and liabilities assumed is recorded as goodwill.

The determination of fair value requires management to make significant estimates, particularly with respect to intangible assets. These estimates are inherently uncertain and subject to change as additional information is obtained during the measurement period, which lasts for up to one year from the acquisition date. See Note 4 "Business Combination" for details.

Use of Estimates

The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of those financial statements and the reported amounts of revenue and expense during the reporting period. These estimates include, but are not limited to, the standalone selling prices of performance obligations, the incremental borrowing rate associated with lease liabilities, the useful life of capitalized costs to obtain revenue contracts, income taxes including tax-related valuation allowances, the valuation and assumptions underlying stock-based compensation, the fair value of acquired assets and assumed liabilities from business combinations, contingent consideration, as well as the fair value of acquiree exchanged stock-based

compensation awards, and useful lives and recoverability of intangible assets. Management bases its estimates on historical experience and on various other market-specific and relevant assumptions that it believes to be reasonable under the circumstances. Actual results could differ from those estimates and such differences could be material to the financial position and results of operations.

Segment Information

The Company is the provider of the platform and operates as one operating segment. An operating segment is defined as a component of an enterprise for which separate financial information is evaluated regularly by the chief operating decision makers ("CODM"). The Company defines its CODM as its executive officers, and their role is to make decisions about allocating resources and assessing performance. Following the acquisition of Hearsay, the Company's business continues to operate as one operating segment, with its CODM evaluating the Company's financial information, resources and performance on a consolidated basis. Since the Company operates as one operating segment, all required financial segment information can be found in the condensed consolidated financial statements.

Concentration of Credit Risk

Certain financial instruments that could be exposed to a concentration of credit risk include cash and cash equivalents and accounts receivable. The Company deposits its cash with financial institutions, and such deposits, at times, may exceed federally insured limits. The Company has not experienced any losses on its deposits of cash and cash equivalents to date. Collateral is not required for accounts receivable. One customer accounted for 11% of accounts receivable as of October 31, 2024, and as of January 31, 2024, no single customer accounted for more than 10% of the Company's accounts receivable. No single customer accounted for more than 10% of the Company's total revenue for the three and nine months ended October 31, 2024 and 2023, respectively.

Recent Accounting Pronouncements

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which expands annual and interim disclosure requirements for reportable segments, primarily through enhanced disclosures about significant segment expenses. The updated standard is effective for the Company's annual periods beginning in fiscal 2025 and interim periods beginning in the first quarter of fiscal 2026. Early adoption is permitted. The Company is currently evaluating the impact of adopting ASU 2023-07.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which includes amendments that further enhance income tax disclosures, primarily through standardization and disaggregation of rate reconciliation categories and income taxes paid by jurisdiction. The amendments are effective for the Company’s annual periods beginning in fiscal 2026, with early adoption permitted, and should be applied either prospectively or retrospectively. The Company is currently evaluating the impact of ASU 2023-09.

In November 2024, the FASB issued 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosure (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires disaggregated disclosures, in the notes to the financial statements, of certain categories of expenses that are included in expense line items on the face of the income statement. The updated standard is effective for the Company's annual periods beginning in fiscal 2028 and interim periods beginning in the first quarter of fiscal 2029. Early adoption is permitted. ASU 2024-03 is required to be applied prospectively, with retrospective application permitted. The Company is currently evaluating the impact of adopting ASU 2024-03.

3. Revenue

Performance Obligations

The Company has identified that it has two distinct performance obligations: subscription and associated support to the Company's platform and professional services. The Company's revenue is predominantly related to its subscription and associated support to the Company's platform. Professional services revenue accounted for approximately 7% and 8% of the Company's total revenue for the nine months ended October 31, 2024 and 2023, respectively.

Geographic Region

The Company disaggregates its revenue from contracts with customers by geographic region, as it believes this best depicts how the nature, amount, timing, and uncertainty of its revenues and cash flows are affected by economic factors. Revenue by geographic region is determined based on the region of the Company's contracting entity, which may be different than the region of its customers. The following table presents the Company's revenue by geographic region:


	Three months ended October 31,				Nine months ended October 31,
(in thousands)	2024		2023		2024		2023
North America	$	91,998	$	79,937	$	244,178	$	239,256
International	21,991		21,227		63,688		63,959
Total revenue	$	113,989	$	101,164	$	307,866	$	303,215

North America revenue is attributable to the United States. International revenue is predominantly attributable to European countries, but also includes Japan.

The Company's revenue attributable to the United States represented 79% of total revenue, revenue attributable to the United Kingdom, which serves as the Company's main contracting entity for Europe, represented 20% of total revenue, and no other individual country represented more than 10% of total revenue for each the nine months ended October 31, 2024 and 2023.

Contract Assets

The Company records a contract asset when revenue is recognized prior to being billed. Contract assets were $2.0 million as of October 31, 2024 and were not significant as of January 31, 2024. Contract assets are included in prepaid expenses and other current assets on the condensed consolidated balance sheet.

Contract Liabilities

A contract liability is an obligation to transfer goods or services for which consideration has been received or is due to a customer. The Company's contract liabilities consist primarily of unearned revenue and, to a lesser extent, customer deposits.

As of October 31, 2024, unearned revenue, current was $160.9 million, while unearned revenue, non-current, which is included within other long term liabilities on the Company's condensed consolidated balance sheet, was $1.5 million. Revenue recognized of $188.2 million during the nine months ended October 31, 2024 was included in unearned revenue at the beginning of the period.

Customer deposits represent payments received in advance in instances where a revenue contract is cancelable in nature, and therefore the Company does not have an unconditional obligation to transfer control to a customer. As of October 31, 2024 and January 31, 2024, customer deposits of $0.4 million and $0.2 million are included in accounts payable, accrued expenses and other current liabilities on the Company's condensed consolidated balance sheet, respectively.

Remaining Performance Obligations

The transaction price allocated to remaining performance obligations represents amounts under non-cancelable contracts expected to be recognized as revenue in future periods, and may be influenced by several factors, including seasonality, the timing of renewals, and contract terms. As of October 31, 2024, the Company had $457.1 million of remaining performance obligations, of which $404.5 million is expected to be recognized as revenue over the next twenty-four months, with the remaining balance expected to be recognized thereafter. As of January 31, 2024, the Company had $465.1 million of remaining performance obligations.

4. Business Combination

Hearsay Acquisition

On August 1, 2024 (the "Acquisition Date"), Yext completed its acquisition of Hearsay pursuant to an Agreement and Plan of Merger dated June 10, 2024 (such acquisition, the "Acquisition"). At the effective time of the Acquisition, each outstanding share of Hearsay stock was canceled and converted to a right to receive cash consideration, and Hearsay became a wholly owned subsidiary of Yext. The Acquisition is intended to produce an end-to-end digital presence platform, combining Yext’s digital presence management capabilities with Hearsay's compliant engagement solutions across social media, websites, text, and voice.

The Acquisition Date fair value of consideration transferred for Hearsay consisted of the following:


(in thousands)
Cash consideration and liabilities incurred	$	132,462
Contingent consideration	39,500
Fair value of outstanding employee awards assumed	7,825
Other transaction related payments	555
Total consideration transferred	$	180,342

Cash consideration and liabilities incurred of $132.5 million includes the base purchase price of $125.0 million and customary adjustments set forth in the merger agreement. The cash consideration includes $17.2 million of payments held in escrow as partial security for certain indemnification obligations of the former holders of Hearsay equity. Amounts held in escrow were reflected on the Company's condensed consolidated balance sheet at the Acquisition Date within restricted cash (current and non-current) as the funds are owned by the Company until settlement. In connection with the amounts held in escrow, the Company recognized a corresponding liability on its condensed consolidated balance sheet at the Acquisition Date at its present value of $16.6 million to reflect the amounts payable to former Hearsay equity holders following the resolution of contingencies surrounding the amounts held in escrow. The liability will be accreted to its contractual value over the estimated escrow period with changes in the liability being recorded within interest expense on the Company's condensed consolidated statements of operations and comprehensive loss. The amount of interest expense was immaterial during the three and nine months ended October 31, 2024.

The preliminary purchase price also includes $39.5 million of contingent consideration related to an earnout arrangement whereby the Company may be required to pay up to $75.0 million to the former holders of Hearsay's outstanding equity interests, subject to the achievement of certain Annual Recurring Revenue ("ARR") milestones over a two-year period. The portion of the earnout arrangement included within contingent consideration excludes amounts attributable to employees of Hearsay that held unvested awards as of the Acquisition Date, for which earnout payments are subjected to future service. Accordingly, these amounts represent compensation expense in the post-Acquisition period. Payment of the earnout can be settled in cash or shares at the Company's election. The Company preliminarily estimated the fair value of the contingent consideration as of the Acquisition Date. This estimate incorporates projected ARR values inclusive of revenue synergies and growth rates, as well as other key inputs. The key inputs as of the Acquisition Date are outlined below:



Volatility						15%
Revenue beta						0.35
Expected timing of payment						FY 2026 - FY 2027
Discount rate						5.90% - 6.20%

See Note 6 "Fair Value of Financial Instruments" for additional details on the fair value of contingent consideration.

The Company also issued approximately 2.1 million replacement equity awards with a fair value of $11.8 million, of which (i) $7.8 million was allocated to consideration transferred for pre-Acquisition services, inclusive of employer related payroll taxes, and (ii) $4.2 million was allocated to the post-Acquisition period and expensed over the remaining requisite service period associated with the awards. The value attributed to consideration transferred was based on the fair value of Hearsay options prior to the exchange. Approximately 1.5 million equity awards that were granted also vested on the Acquisition Date, and $0.6 million was recognized in the post-Acquisition period immediately to reflect the excess of the fair value of the replacement awards over the fair value of the Hearsay options. These awards were subsequently net settled, which represents an event that is separate from the Acquisition.

In addition, the Company recognized other transaction related payments of $0.6 million in the estimated consideration which are comprised primarily of preliminary post-closing adjustments, including estimated working capital.

The Company is also required to make additional payments related to a $20.0 million incentive pool that can be settled in cash or shares at the Company's election, shortly after the first anniversary of the Acquisition Date. Approximately $8.8 million of this pool is to be paid to Hearsay founders and early employees, and is not contingent on future service being provided. This amount was recognized immediately in the post-Acquisition period in operating expenses, within general and administrative expenses on the Company's condensed consolidated statements of operations and comprehensive loss. The remaining amount of the incentive pool is

allocated to employees generally subject to continued employment of one-year from the Acquisition Date. In addition, a transaction bonus of $1.5 million is payable to individuals determined by Hearsay and deemed to be compensation expense attributable to the post-Acquisition period. Amounts attributable to the remaining incentive pool and transaction bonus will be expensed in the post-Acquisition period over the requisite service period.

Acquisition-related costs totaled $9.0 million and $11.2 million for the three and nine months ended October 31, 2024, respectively. These costs are expensed as incurred and include $8.8 million related to the portion of the incentive pool attributable to Hearsay founders and early employees, as well as professional fees. Acquisition-related costs are presented within general and administrative expense in the Company's condensed consolidated statement of operations and comprehensive loss.

The Company's financial results for the three and nine months ended October 31, 2024 reflect inclusion of the business operations of Hearsay from the Acquisition Date, which contributed $16.4 million and $7.9 million of revenue and net loss, respectively for both periods.

The following table summarizes the preliminary purchase price allocation of the fair values of the assets acquired and liabilities assumed at the Acquisition Date:


(amounts in thousands)






Assets acquired:
Cash and cash equivalents	$	26,362
Accounts receivable, net	5,619
Prepaid expenses and other current assets	2,454
Property and equipment, net	399
Operating lease right-of-use assets	414
Other long term assets (1)	5,942
Liabilities assumed:
Accounts payable, accrued expenses, and other current liabilities	(5,127)
Operating lease liabilities, current	(74)
Unearned revenue, current	(37,672)

Operating lease liabilities, non-current	(340)
Other long term liabilities (1)(2)	(9,465)
Identifiable intangible assets acquired	91,300



Net assets acquired	$	79,812
Goodwill	$	100,530
Total consideration	$	180,342

(1) Other long term assets includes a $5.9 million indemnification asset, with the underlying indemnified liability of $6.2 million recorded within other long term liabilities.

(2) Included within other long term liabilities is a deferred tax liability of approximately $1.7 million.

The Company determined the fair value of assets acquired and liabilities assumed by using available market information and various valuation methods that require judgement related to estimates. The preliminary fair value estimates and assumptions regarding certain tangible assets acquired and liabilities assumed, and the valuation of intangible assets acquired, income taxes and contingent consideration are subject to change as additional information is obtained during the measurement period.

Pursuant to the terms of the merger agreement, the Company was indemnified by the sellers for the pre-Acquisition contingent liability assumed in the Acquisition associated with the Canadian Good and Services Tax (“GST”) and Harmonized sales tax (“HST”) related to certain historical foreign sales transactions. The indemnification of the indirect tax liability is capped at $5.9 million and an escrow fund was established in the same amount. At the Acquisition Date, the associated indirect tax liability was recorded at the estimated fair value of $6.2 million within other long term liabilities, and the Company recorded an indemnification asset up to the amount of the escrow fund balance of $5.9 million. In October 2024, initial filings to settle this matter with the Canada Revenue Agency were initiated and an initial payment of $1.9 million was made. As of October 31, 2024, the remaining indirect tax liability was $4.5 million.

Goodwill represents the excess of the purchase consideration over the fair value of the underlying net identifiable assets and is attributable primarily to expected synergies and the assembled workforce of Hearsay. Goodwill is not deductible for income tax purposes.

Intangible Assets

The following table sets forth the preliminary amounts allocated to the intangible assets identified and their estimated useful lives as of the Acquisition Date:


Identifiable Intangible Assets Acquired	Approximate Fair Value (In thousands)		Estimated Useful Life (In years)	Classification of Amortization
Customer relationships	$	66,300	12	Sales and marketing
Technology	24,200		3	Cost of revenue
Trademark	800		3	Sales and marketing
Total	$	91,300

The fair values of the identifiable intangible assets are based on management’s estimates as of the Acquisition Date. The fair value of the intangible assets was determined using the excess earnings method and the relief from royalty method, under the income approach. The Company applied judgment in estimating the fair value of customer relationships using the excess earnings method, which involved the use of significant assumptions with respect to revenue, EBITDA, attrition rate, research and development addback, technology royalty rate, and discount rate. The fair value of the developed technology and trademark was estimated using the relief from royalty method, which incorporates assumptions including royalty rates, annual obsolescence, tax rates, and discount rates.

Pro Forma Results

The unaudited pro forma financial information presented below was derived from historical financial records of Yext and Hearsay and presents the operating results for the periods presented as if the Acquisition occurred on February 1, 2023. The pro forma results include adjustments to record additional compensation expense, adjust commission expense, and adjust for the impact of purchase accounting adjustments including amortization and depreciation expense, and the related tax effects.

Accordingly, the following unaudited pro forma results are presented for informational purposes only and are not necessarily indicative of what the actual results of operations of the combined company would have been if the Acquisition had occurred at the beginning of fiscal year 2024, nor are they indicative of future results of operations:


(in thousands)	Three months ended October 31,				Nine months ended October 31,
	2024		2023		2024		2023
Revenue	$	113,989	$	117,253	$	339,058	$	348,017
Net income (loss)	$	3,862	$	(7,041)	$	(21,976)	$	(43,357)

5. Investments in Marketable Securities

The following tables summarize the Company's investments in marketable securities:


	October 31, 2024
(in thousands)	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
Money market funds	$	40,792	$	—	$	—	$	40,792

Total marketable securities	$	40,792	$	—	$	—	$	40,792

	January 31, 2024
(in thousands)	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
Money market funds	$	63,966	$	—	$	—	$	63,966
U.S. treasury securities	82,642		—		(7)		82,635
Total marketable securities	$	146,608	$	—	$	(7)	$	146,601

As of October 31, 2024 and January 31, 2024, the Company's marketable securities have a maturity of 90 days or less and are classified as cash and cash equivalents. During the nine months ended October 31, 2024 and 2023, the Company had no material reclassification adjustments from accumulated other comprehensive loss to net loss.

The Company classifies interest income on investments in marketable securities, amortization of premiums and discounts, and realized gains and losses on securities available for sale within interest income in the condensed consolidated statements of operations and comprehensive loss.

The Company regularly reviews its debt securities and monitors the surrounding economic conditions to assess the risk of expected credit losses. As of October 31, 2024 and January 31, 2024, the unrealized losses and the related risk of expected credit losses were not significant.

6. Fair Value of Financial Instruments

Fair value is the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Subsequent changes in fair value of these financial assets and liabilities are recognized in earnings or other comprehensive (loss) income when they occur. When determining the fair value measurements for assets and liabilities which are required to be recorded at fair value, the Company considers the principal or most advantageous market in which the Company would transact and the market-based risk measurement or assumptions that market participants would use in pricing the assets or liabilities, such as inherent risk, transfer restrictions, and credit risk.

The Company applies the following fair value hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement:

Level 1 inputs are based on quoted prices in active markets for identical assets or liabilities.

Level 2 inputs are based on observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which all significant inputs are observable or can be derived principally from or corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3 inputs are based on unobservable inputs to the valuation methodology that are significant to the measurement of fair value of assets or liabilities, and typically reflect management's estimates of assumptions that market participants would use in pricing the asset or liability.

The Company's assets and liabilities measured at fair value on a recurring basis, by level, within the fair value hierarchy are as follows:


	October 31, 2024
(in thousands)	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents:
Money market funds	$	40,792	$	—	$	—	$	40,792

Total assets	$	40,792	$	—	$	—	$	40,792
Liabilities:
Contingent consideration	$	—	$	—	$	40,107	$	40,107
Total liabilities	$	—	$	—	$	40,107	$	40,107
	January 31, 2024
(in thousands)	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents:
Money market funds	$	63,966	$	—	$	—	$	63,966
U.S. treasury securities	—		82,635		—		82,635
Total assets	$	63,966	$	82,635	$	—	$	146,601

The Company’s cash equivalents and marketable securities for the periods presented were valued using quoted market prices or alternative pricing sources and models utilizing observable market inputs and were classified as Level 1 or Level 2, accordingly.

As of October 31, 2024, the Company measured its contingent consideration associated with the Acquisition, on a recurring basis using significant unobservable inputs, classified as Level 3.

Contingent Consideration

The Company records contingent consideration resulting from a business combination at its fair value on the acquisition date. The Company generally determines the fair value of contingent consideration using the Real Options Method that employs a Monte Carlo simulation model. Each reporting period thereafter, these obligations are revalued and changes in their fair values are recorded within general and administrative expenses within the condensed consolidated statements of operations and comprehensive loss. Changes in the fair value of the contingent consideration can result from changes in assumed discount periods and rates, and from changes pertaining to the estimated or actual achievement of the defined milestones. Significant judgment is employed in determining the appropriateness of these assumptions as of the acquisition date and for each subsequent period. Accordingly, future business and economic conditions, as well as changes in any of the assumptions described above, can materially impact the fair value and corresponding changes in fair value of the contingent consideration the Company records in any given period.

In connection with the Acquisition, the estimated fair value of the contingent consideration incorporates projected ARR values inclusive of revenue synergies and growth rates, as well as other key inputs. The key inputs as of October 31, 2024 are outlined below:



Volatility						15%
Revenue beta						0.35
Expected timing of payment						FY 2026 - FY 2027
Discount rate						5.90% - 6.20%

A rollforward of the fair value of the contingent consideration liability for the three months ended October 31, 2024 is as follows:


(in thousands)
Balance as of August 1, 2024	$	39,500
Change in fair value	607
Balance as of October 31, 2024	$	40,107

7. Goodwill and Intangible Assets

Goodwill

Goodwill is not amortized but is subject to periodic testing for impairment at the reporting unit level, which is at or one level below the operating segment level. The Company operates as one operating segment, which represents its one reporting unit. The test for impairment is conducted annually each November 1st, or more frequently if events occur or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount.

During the three months ended October 31, 2024, the Acquisition was completed, resulting in the following changes in the carrying amount of goodwill for the nine months ended October 31, 2024:


(in thousands)
Balance as of January 31, 2024	$	4,478
Goodwill acquired - Hearsay Social, Inc.	100,530
Effect of foreign currency translation on Goodwill acquired	12
Balance as of October 31, 2024	$	105,020

The Company determined that no events occurred or circumstances changed that would more likely than not reduce the fair value of the Company's reporting unit below its carrying amount during the reporting periods ended October 31, 2024, and 2023.

Intangible Assets

The Company’s intangible assets with definite lives are amortized on a straight-line basis over their estimated useful lives, which range from 3 to 15 years. Intangible assets with finite lives are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. The Company has no indefinite-lived intangible assets.

The Company determined that no events occurred or circumstances changed during the reporting periods ended October 31, 2024 and 2023 that would indicate that its intangible assets with finite lives may not be recoverable. However, if certain events occur or circumstances change, it may be necessary to record impairment charges in the future.

Amortization expense was $3.5 million for each of the three and nine months ended October 31, 2024, respectively and less than $0.1 million for each of the three and nine months ended October 31, 2023, respectively.

The gross carrying amount and accumulated amortization of intangible assets other than goodwill are as follows:


	As of October 31, 2024
(in thousands)	Gross Carrying Amount		Accumulated Amortization		Net Carrying Value		Weighted Average Remaining Useful Life
Domains	$	365	$	(214)	$	151	6.3
Customer relationships (1)	66,300		(1,381)		64,919		11.8
Technology (1)	24,200		(2,017)		22,183		2.7
Trademarks (1)	800		(67)		733		2.7
Total as of October 31, 2024	$	91,665	$	(3,679)	$	87,986	9.4

	As of January 31, 2024
(in thousands)	Gross Carrying Amount		Accumulated Amortization		Net Carrying Value		Weighted Average Remaining Useful Life

Domains	$	365	$	(197)	$	168	7.0


Total as of January 31, 2024	$	365	$	(197)	$	168

(1) Recognized in connection with the Acquisition.

The estimated future aggregate amortization expense as of October 31, 2024 is as follows (in thousands):


Fiscal Year Ending January 31,
2025 (remainder of year)	$	3,471
2026	13,882
2027	13,882
2028	9,716
2029	5,549
2030 and thereafter	41,486
Total	$	87,986

8. Property and Equipment, Net

Property and equipment are recorded at cost and depreciated or amortized on a straight-line basis over their estimated useful lives. Property and equipment, net consisted of the following:


(in thousands)	October 31, 2024		January 31, 2024
Computer software	$	24,086	$	22,500
Office equipment	23,556		22,674
Furniture and fixtures	7,956		7,930
Leasehold improvements	60,134		59,927
Construction in progress	—		249
Software in progress	261		370
Total property and equipment, gross	115,993		113,650
Less: accumulated depreciation	(73,747)		(65,108)
Total property and equipment, net	$	42,246	$	48,542

As of October 31, 2024 and January 31, 2024, the Company's property and equipment, net attributable to the United States was 91% and 90%, respectively. No other individual country represented more than 10% of the total property and equipment, net as of those periods. Depreciation expense was $2.8 million and $8.6 million for the three and nine months ended October 31, 2024, respectively and $3.5 million and $12.6 million for the three and nine months ended October 31, 2023, respectively.

9. Accounts Payable, Accrued Expenses and Other Current Liabilities

Accounts payable, accrued expenses and other current liabilities consisted of the following:


(in thousands)	October 31, 2024		January 31, 2024
Accounts payable	$	8,031	$	7,430
Accrued employee compensation (1)	20,928		15,961

Accrued Publisher Network fees	2,147		1,839
Accrued professional services and associated costs	2,971		2,307


Accrued employee stock purchase plan withholdings liability	486		1,958

Other current liabilities (2)(3)	27,548		9,271
Total accounts payable, accrued expenses and other current liabilities	$	62,111	$	38,766

(1) As of October 31, 2024, accrued employee compensation includes $3.5 million related to the portion of the incentive pool and other retention arrangements where continuing service is required arising from the Acquisition.

(2) As of October 31, 2024, other current liabilities includes $11.3 million payable to Hearsay owners in connection with escrow funds held by Yext related to indemnity claims in connection with the Acquisition.

(3) As of October 31, 2024, other current liabilities includes $8.8 million related to the incentive pool allocated to founders and early employees in connection with the Acquisition.

10. Stock-Based Compensation

Hearsay Social, Inc. 2019 Equity Incentive Plan

In connection with the Acquisition, the Company assumed the Hearsay Social, Inc. 2019 Equity Incentive Plan (the "Hearsay Plan"), including all outstanding restricted stock units ("RSUs") held by continuing Hearsay employees. These assumed awards were converted into approximately 2.1 million RSUs to receive shares of the Company’s common stock at the effective time of the Acquisition and are generally subject to their original terms and conditions under the Hearsay Plan. The Hearsay Plan allows for the issuance of up to approximately 6.0 million shares of the Company’s common stock. Under the Hearsay Plan, the Company may grant stock options with an exercise price that is no less than the fair market value on the date of grant, restricted stock RSUs, and other stock-based awards to the Company’s employees. Equity awards granted under the Hearsay Plan following the Acquisition are expected to be on similar terms and consistent with similar grants made pursuant the Company’s 2016 Equity Incentive Plan. Awards canceled and forfeited and shares withheld to satisfy tax withholding obligations become further available for future issuance under the Hearsay Plan. As of October 31, 2024, approximately 3.8 million shares were available for future award under the Hearsay Plan.

Stock-Based Compensation Expense

Stock-based compensation represents the cost related to stock-based awards granted in lieu of monetary payment. The Company measures stock-based compensation associated with stock-based awards issued to employees at the grant date, based on the estimated fair value of the award, and recognizes expense, net of estimated forfeitures, over the requisite service period of the applicable award generally using the straight-line method or accelerated attribution method.

The following table summarizes the Company's stock-based compensation expense for equity classified awards for the periods presented:


	Three months ended October 31,				Nine months ended October 31,
(in thousands)	2024		2023		2024		2023
Equity classified awards:
Cost of revenue	$	701	$	739	$	2,087	$	2,151
Sales and marketing	4,104		4,336		10,010		12,222
Research and development	2,533		2,822		7,923		8,385
General and administrative	5,355		3,861		17,071		11,577
Total stock-based compensation expense	$	12,693	$	11,758	$	37,091	$	34,335

In addition, certain liability classified awards were granted in connection with the Acquisition and generally relate to portions of the incentive pool and earnout that generally vest over one year from the Acquisition Date. These awards may be settled in cash or shares at the Company's election, and are measured at fair value at each reporting date based on their expected value, with compensation cost being recognized over the related service period. The corresponding liabilities associated with these awards are included within accounts payable, accrued expenses and other current liabilities, and other long term liabilities on the Company's condensed consolidated balance sheet depending on the estimated settlement date of the award. The following table summarizes the Company's stock-based compensation expense for liability classified awards for the periods presented:


	Three months ended October 31,				Nine months ended October 31,
(in thousands)	2024		2023		2024		2023
Liability classified awards:
Cost of revenue	$	94	$	—	$	94	$	—
Sales and marketing	1,759		—		1,759		—
Research and development	1,023		—		1,023		—
General and administrative	250		—		250		—
Total stock-based compensation expense	$	3,126	$	—	$	3,126	$	—

Stock Options

The following table summarizes the activity related to the Company's stock options:


	Outstanding Stock Options	Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Life (in years)	Aggregate Intrinsic Value (in thousands)
Balance, January 31, 2024	2,021,494	$	6.26	2.20	$	989
Granted	—	$	—
Exercised	(321,796)	$	3.53
Forfeited or canceled	(87,689)	$	8.40
Balance, October 31, 2024	1,612,009	$	6.69	1.70	$	1,315
Vested and expected to vest	1,612,009	$	6.69	1.70	$	1,315
Exercisable, October 31, 2024	1,612,009	$	6.69	1.70	$	1,315

Restricted Stock and Restricted Stock Units

The following table summarizes the activity related to the Company's restricted stock and restricted stock units ("RSUs"):


	Outstanding	Weighted-Average Grant Date Fair Value
Balance, January 31, 2024	9,790,748	$	7.54
Granted	7,633,439	$	5.67
Vested and converted to shares	(4,611,479)	$	7.53
Forfeited or canceled	(1,894,265)	$	6.99
Balance, October 31, 2024	10,918,443	$	6.33

Performance-Based Restricted Stock Units

The following table summarizes the activity related to the Company’s performance-based restricted stock units ("PSUs"):


	Number of PSUs	Weighted-Average Grant Date Fair Value
Balance, January 31, 2024	3,555,000	$	5.98
Granted	—	$	—
Vested	—	$	—
Forfeited or canceled	(25,000)	$	5.05
Balance, October 31, 2024	3,530,000	$	5.98

As of October 31, 2024, the market conditions accompanying the PSUs were not satisfied and therefore, no shares vested.

11. Debt

On March 11, 2020, the Company entered into a credit agreement (the “Credit Agreement”) with Silicon Valley Bank (“SVB”). In January 2021, the Company amended the Credit Agreement which modified the conditions pursuant to which subsidiaries are required to become guarantors. On December 22, 2022, the Company entered into a second amendment (“Amendment No. 2”) to the Credit Agreement, dated March 11, 2020, and on July 26, 2024, the Company entered into a third amendment ("Amendment No. 3") to the Credit Agreement, collectively referred to as the Credit Facility. No significant debt issuance costs were incurred in association with Amendment No.2 and Amendment No.3.

Amendment No. 2 amended the Credit Facility to, among other things (i) extend the maturity date of the Credit Facility to December 22, 2025, (ii) amend the interest rate provisions to replace LIBOR with SOFR as the interest rate benchmark, and (iii) amend the recurring revenue growth rate financial covenant.

Amendment No. 3 amended the Credit Facility to, among other things (i) amend the interest rate applicable to loans under the Credit Facility, and (ii) replace the consolidated quick ratio and recurring revenue growth rate financial covenants with consolidated total leverage ratio and minimum liquidity financial covenants.

The Credit Facility provides for a senior secured revolving loan facility of up to $50.0 million that matures on December 22, 2025, with the right subject to certain conditions to add an incremental revolving loan facility of up to $50.0 million in the aggregate. The revolving loan facility provides for borrowings up to the amount of the facility with sub-limits of up to (i) $30.0 million to be available for the issuance of letters of credit and (ii) $10.0 million to be available for swingline loans.

As amended, the revolving loans bear interest, at the Company’s election, at an annual rate based on SOFR or a base rate. Loans based on SOFR shall bear interest at a rate between SOFR plus 1.75% and SOFR plus 2.25%, depending on the Company’s consolidated total leverage ratio and subject to a SOFR floor of 1.00%. Loans based on the base rate shall bear interest at a rate between the base rate minus 1.25% and the base rate minus 0.75%, depending on the Company’s consolidated total leverage ratio. The Company is also obligated to pay a commitment fee on the unused portion of the facility at a rate of 0.25% per annum.

The obligations under the Credit Facility are secured by a lien on substantially all of the Company's tangible and intangible property and by a pledge of all of the Company's equity interests of material direct and indirect domestic subsidiaries and 66% of each class of capital stock of any material first-tier foreign subsidiaries, subject to limited exceptions.

The Credit Facility contains customary affirmative and negative covenants and restrictions, as well as financial covenants that require us to maintain minimum liquidity of $35.0 million at all times and a consolidated total leverage ratio of no greater than 3.00 to 1.00, tested on a quarterly basis.

As of October 31, 2024, the Company was in compliance with all debt covenants. As of such date, the $50.0 million revolving loan facility had $36.6 million available and $13.4 million in letters of credit allocated as security in connection with office space.

12. Income Taxes

The Company calculates its year-to-date provision for income taxes by applying the estimated annual effective tax rate ("AETR") to year-to-date income or loss from operations before income taxes and adjusts for discrete tax items recorded in the period. During the three and nine months ended October 31, 2024, the Company recorded a provision for income taxes of $3.0 million and $1.8 million, respectively. During the three and nine months ended October 31, 2023, the Company recorded a provision for income taxes of $0.4 million and $1.3 million, respectively.

The provision for income taxes recorded included a discrete tax benefit of $1.4 million from a partial release of the valuation allowance in connection with the Acquisition. The net deferred tax liability from the Acquisition provided a source of additional income to support the realizability of the Company's pre-existing deferred tax assets and as a result, the Company released a portion of its valuation allowance. The tax benefit associated with the release of the valuation allowance was offset by income taxes in profitable jurisdictions outside of the United States and the Company's state taxes.

The Company's effective tax rate generally differs from the U.S. federal statutory tax rate primarily due to full valuation allowances related to the Company's net deferred tax assets in the U.S. and certain foreign jurisdictions, U.S. state income taxes, and foreign rate differential on profitable jurisdictions. The Company regularly evaluates the realizability of its deferred tax assets and establishes a valuation allowance on a jurisdictional basis if it is more likely than not that some or all the deferred tax assets will not be realized. In making such a determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, loss carryback, and tax-planning strategies. Generally, more weight is given to objectively verifiable evidence, such as the cumulative loss in recent years, as a significant piece of negative evidence to overcome. To the extent sufficient positive evidence becomes available, a portion of the valuation allowance against certain net deferred tax assets could be released in the future and would result in a non-cash income tax benefit in the period of release.

13. Commitments and Contingencies

Contractual Obligations

The Company is obligated to make payments under certain non-cancelable contractual obligations in the normal course of business. The Company's contractual obligations primarily relate to its operating lease arrangements for office space. Its other contractual obligations include contracts with its Publisher Network application providers, which generally have a term of one year, although some have a term of several years, and its software vendors, among others. These obligations represent minimum contractual payments, or the Company's best estimate for variable elements based on historical payments. The Company's contractual obligations have various expiry dates between fiscal years 2025 and 2035.

As of October 31, 2024, the Company's contractual obligations are as follows (in thousands):


Fiscal year ending January 31:	Leases		Other
2025 (remainder of fiscal year)	$	4,604	$	16,217
2026	19,391		18,845
2027	19,457		9,340
2028	19,554		4,611
2029	19,404		16
2030 and thereafter	36,566		90
Total	$	118,976	$	49,119

The Company may also be required to pay up to $75.0 million to the former holders of Hearsay's outstanding equity interests, subject to the achievement of certain ARR milestones over a two-year period. Payments can be settled in cash or shares at the Company's election and are estimated to occur in fiscal years 2026 and 2027.

Legal Proceedings

The Company is and may be involved in various legal proceedings arising in the normal course of business. Although the results of litigation and claims cannot be predicted with certainty, currently, in the opinion of the Company, the likelihood of any material adverse impact on the Company's results of operations, cash flows or the Company's financial position for any such litigation or claims is deemed to be remote. Regardless of the outcome, litigation can have an adverse impact on the Company because of defense costs, diversion of management resources and other factors.

Warranties and Indemnifications

The Company's platform is in some cases warranted to perform in a manner consistent with general industry standards that are reasonably applicable and materially in accordance with the Company's product specifications.

The Company's arrangements generally include certain provisions for indemnifying customers against liabilities if its products or services infringe a third-party's intellectual property rights and/or if the Company breaches its contractual agreements with a customer

or in instances of negligence, fraud or willful misconduct by the Company. To date, the Company has not incurred any material costs as a result of such obligations and has not accrued any significant liabilities related to such obligations in the accompanying condensed consolidated financial statements.

The Company has also agreed to indemnify certain of its directors and executive officers for costs associated with any fees, expenses, judgments, fines and settlement amounts incurred by any of these persons in any action or proceeding to which any of those persons is, or is threatened to be, made a party by reason of the person's service as a director or officer, including any action by the Company, arising out of that person's services as the Company's director or officer or that person's services provided to any other company or enterprise at the Company's request. The Company maintains director and officer insurance coverage that would generally enable the Company to recover a portion of future amounts paid. The Company may also be subject to indemnification obligations by law with respect to the actions of its employees under certain circumstances and in certain jurisdictions.

14. Net Loss Per Share Attributable to Common Stockholders

The following table sets forth the computation of the basic and diluted net loss per share attributable to common stockholders:


	Three months ended October 31,				Nine months ended October 31,
(in thousands, except share and per share data)	2024		2023		2024		2023
Numerator:
Net loss attributable to common stockholders	$	(12,799)	$	(468)	$	(20,673)	$	(4,317)
Denominator:
Weighted-average common shares outstanding	128,036,993		124,239,180		126,668,394		123,962,358
Net loss per share attributable to common stockholders, basic and diluted	$	(0.10)	$	—	$	(0.16)	$	(0.03)

Basic net loss per share is computed by dividing the net loss attributable to common stockholders by the weighted average number of common shares outstanding during the period. Unvested restricted stock, restricted stock units, and performance-based restricted stock units where the market conditions have not been met are excluded from the denominator of basic net loss per share. Diluted net loss per share is computed by dividing the net loss attributable to common stockholders by the weighted average number of common shares plus common equivalent shares for the period, including any dilutive effect from such shares.

Since the Company was in a net loss position for all periods presented, net loss per share attributable to common stockholders was the same on a basic and diluted basis, as the inclusion of all potential common equivalent shares outstanding would have been anti-dilutive. Anti-dilutive common equivalent shares were as follows:


	As of October 31,
	2024	2023
Options to purchase common stock	1,612,009	2,423,494
Restricted stock and restricted stock units	10,918,443	10,457,918
Shares estimated to be purchased under ESPP	359,798	483,891
Performance-based restricted stock units(1)	3,530,000	2,305,000
Total anti-dilutive common equivalent shares	16,420,250	15,670,303

(1) An additional 1.3 million shares of common stock may be awarded for certain PSUs based on the Company's total shareholder return ("TSR") relative to the TSR of companies in the S&P Software and Services Select Index over specified performance periods.

In connection with the Acquisition, the Company may also be required to pay up to $75.0 million to the former holders of Hearsay's outstanding equity interests, subject to the achievement of certain ARR milestones over a two-year period. Payment can be settled in cash or shares at the Company's election. In addition, an incentive pool of $20.0 million is payable to Hearsay founders, early employees and current employees, which can be settled in cash or shares at the Company's election.

Item 2. 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 in conjunction with our condensed consolidated financial statements and related notes appearing elsewhere in this Quarterly Report on Form 10-Q and in our Annual Report on Form 10-K for the fiscal year ended January 31, 2024, filed with the Securities and Exchange Commission ("SEC") on March 13, 2024. As discussed in the section titled "Special Note Regarding Forward Looking Statements," the following discussion and analysis contains forward looking statements that involve risks and uncertainties, as well as assumptions that, if they never materialize or prove incorrect, could cause our results to differ materially from those expressed or implied by such forward looking statements. Factors that could cause or contribute to these differences include, but are not limited to, those discussed in the section titled "Risk Factors" under Part II, Item 1A in this Quarterly Report on Form 10-Q.

Overview

Yext empowers businesses to manage their knowledge so they can deliver relevant, actionable answers to consumer questions as well as consistent, accurate and engaging experiences to customers throughout the digital ecosystem. Our digital presence platform (also known as the Answers Platform) lets businesses structure and organize information about their brands in our knowledge graph, Yext Content (also known as the Knowledge Graph), which is then delivered across first-and third-party websites and applications through our network of over 200 service and application providers, which we refer to as our Publisher Network. These publishers include, among others, Amazon Alexa, Apple, Bing, Facebook, Google Business Profile, and Yelp. Our platform powers all of our key products, including Listings, Reviews, Pages and Search, each with robust analytics capabilities for businesses to easily track performance across customer experiences. It is our mission to empower businesses to easily manage every aspect of their digital presence to make meaningful connections with their customers across every digital touchpoint.

We sell our platform throughout the world to customers of all sizes, including our enterprise, mid-size, and third-party reseller customers. In transactions with resellers, we are only party to the transaction with the reseller and are not a party to the reseller's transaction with its customer.

Revenue is a function of the number of customers, the number of licenses or capacity purchased by each customer, the package to which each customer subscribes, the price of the package and renewal rates. We offer subscriptions in a discrete range of packages, with pricing based on specified feature sets and the number of licenses managed by the customer as well as on a capacity-basis.

In August 2024, we acquired Hearsay Social, Inc., a digital client engagement platform for financial services ("Hearsay"). See Note 4. "Business Combination" to our condensed consolidated financial statements for additional information.

Fiscal Year

Our fiscal year ends on January 31st. References to fiscal 2025, for example, are to the fiscal year ending January 31, 2025.

Macroeconomic Conditions

Our results of operations have been and may continue to be influenced by general macroeconomic conditions, including, but not limited to, the impact of foreign currency fluctuations, interest rates, inflation, recession risks, and geopolitical events and shifts. Fluctuations in foreign exchange rates and rising inflation have had, and may continue to have an adverse impact on our financial condition and operating results in future periods. The extent to which such disruptions will continue in future periods remains uncertain, which has had and may continue to have an adverse impact on our financial condition and operating results in future periods. We continue to be committed to our business, the strength of our platform, our ability to continue to execute on our strategy, and our efforts to support our customers.

Near-term revenues are relatively predictable as a result of our subscription-based business model. However, if the macroeconomic uncertainty continues or further increases, we may continue to experience a negative impact on existing and potential customers, that may reduce, suspend or delay technology spending, request to renegotiate contracts to obtain concessions such as, extended billing and payment terms; shorten the duration of contracts; or elect not to renew their subscriptions which could materially adversely impact our business, financial condition and results of operations in future periods. Therefore, changes in our contracting activity in the near term may not be fully reflected in our results of operations and overall financial performance until future periods.

Recent Developments

On June 4, 2024, we committed to a restructuring plan in response to evolving business needs to reduce operating expenses and position Yext for profitable future growth (the “Plan”). The Plan reduced the size of our workforce by approximately 12 percent of our full-time employees as compared to our headcount as of January 31, 2024. We incurred approximately $5 million in costs in connection with the Plan during our second quarter of fiscal year 2025, consisting primarily of severance payments, payments in lieu of notice, employee benefits and related costs.

Following approval by our Board of Directors, on June 10, 2024, we entered into an Agreement and Plan of Merger (the “Merger Agreement”) for the acquisition of Hearsay Social, Inc. (“Hearsay”). Pursuant to the Merger Agreement, Hearsay became a wholly owned subsidiary of Yext upon closing of the transaction on August 1, 2024. The acquisition of Hearsay is intended to produce an end-to-end digital presence platform, combining Yext’s cutting-edge digital presence management capabilities with Hearsay’s compliant engagement solutions across social media, websites, text, and voice. We acquired Hearsay for approximately $125 million in cash, as adjusted for customary adjustments set forth in the Merger Agreement and the assumption of Hearsay employee equity awards. We also offered participation rights to key employees and former founders of Hearsay in a bonus pool of $20 million that can be settled in cash or our common stock and shall be subject to 100% vesting on the first anniversary of closing, generally subject to continued employment. In addition, subject to the terms of the Merger Agreement, we may also be required to pay additional contingent consideration of up to $75 million to Hearsay based on the achievement of certain milestones (the “Earnout”). The Earnout shall be payable based on achievement of certain annual recurring revenue targets. The targets shall be measured at the end of the first and second anniversaries of closing. The Earnout may be settled in cash or our common stock at our election. See Note 4 "Business Combination" to our condensed consolidated financial statements for additional information.

See Part II Item 1A “Risk Factors” for further discussion of the possible impact of the current macroeconomic conditions on our business.

Key Metrics

We monitor the following key operational and financial metrics to evaluate our business, measure our performance, identify trends affecting our business, formulate business plans and make strategic decisions.

Annual Recurring Revenue ("ARR")

Annual recurring revenue, or ARR, for Direct customers is defined as the annualized recurring amount of all contracts in our enterprise, mid-size and small business customer base as of the last day of the reporting period. The recurring amount of a contract is determined based upon the terms of a contract and is calculated by dividing the amount of a contract by the term of the contract and then annualizing such amount. The calculation assumes no subsequent changes to the existing subscription. Contracts include portions of professional services contracts that are recurring in nature.

ARR for Third-party Reseller customers is defined as the annualized recurring amount of all contracts with Third-party Reseller customers as of the last day of the reporting period. The recurring amount of a contract is determined based upon the terms of a contract and is calculated by dividing the amount of a contract by the term of the contract and then annualizing such amount. The calculation assumes no subsequent changes to the existing subscription. The calculation includes the annualized contractual minimum commitment and excludes amounts related to overages above the contractual minimum commitment. Contracts include portions of professional services contracts that are recurring in nature. See Part II Item 1A “Risk Factors" for further discussion of Third-party reseller customers.

Total ARR is defined as the annualized recurring amount of all contracts executed as of the last day of the reporting period. The recurring amount of a contract is determined based upon the terms of a contract and is calculated by dividing the amount of a contract by the term of the contract and then annualizing such amount. The calculation assumes no subsequent changes to the existing subscription, and where relevant, includes the annualized contractual minimum commitment and excludes amounts related to overages above the contractual minimum commitment. Contracts include portions of professional services contracts that are recurring in nature.

ARR is independent of historical revenue, unearned revenue, remaining performance obligations or any other accounting principles generally accepted in the United States of America, ("GAAP"), financial measure over any period. It should be considered in addition to, not as a substitute for, nor superior to or in isolation from, these measures and other measures prepared in accordance with GAAP. We believe ARR-based metrics provides insight into the performance of our recurring revenue business model while mitigating fluctuations in billing and contract terms.

The following table provides our ARR for the periods presented:


	October 31,				Variance
	2024		2023		Dollars		Percent
(in thousands)
Direct Customers(1)(2)	$	374,502	$	326,625	$	47,877	15	%
Third-Party Reseller Customers	67,293		70,201		(2,908)		(4)	%
Total Annual Recurring Revenue	$	441,795	$	396,826	$	44,969	11	%

(1) ARR as of October 31, 2024, includes approximately $62.8 million from the acquisition of Hearsay.

(2) ARR as of October 31, 2024 includes a decrease of $10.8 million related to the attrition of a large customer, which occurred during the three months ended January 31, 2024.

Dollar-Based Net Retention Rate

We believe that our ability to retain our customers and expand the ARR they generate for us over time is an important component of our growth strategy and reflects the long term value of our customer relationships. We assess our performance in this area using a metric we refer to as our dollar-based net retention rate, which compares the ARR from a set of subscription customers across comparable periods.

This metric is calculated first by determining the ARR generated 12 months prior to the end of the current period for a cohort of customers who had active contracts at that time. We then calculate ARR from the same cohort of customers at the end of the current period, which includes customer expansion, contraction and churn. The current period ARR is then divided by the prior period ARR to arrive at our dollar-based net retention rate. Any ARR obtained through merger and acquisition transactions does not affect the dollar-based net retention rate until one year from the date on which the transaction closed. The cohorts of customers that we present dollar-based net retention rate for include direct, third-party reseller, and total customers. Direct customers include enterprise, mid-size and small business customers.

The following table provides our dollar-based net retention rate for the periods presented:


	October 31,
	2024	2023
Direct Customers (1)	91%	97%
Third-Party Reseller Customers	93%	95%
Total Customers	91%	96%

(1) Dollar-Based Net Retention Rate as of October 31, 2024 reflects the attrition of a large customer, which occurred during the three months ended January 31, 2024.

Customer Count

Customer count is defined as the total number of customers with contracts executed as of the last day of the reporting period and a unique administrative account identifier on our platform. Generally, we assign unique administrative accounts to each separate and distinct entity (such as a company or government institution) or a business unit of a large corporation, that has its own separate contract with us to access our platform. We believe that customer count provides insight into our ability to grow our enterprise and mid-size customer base. As such, customer count excludes third-party reseller customers and small business customers as well as customers only receiving free trials. From time to time, some customers previously characterized as small business customers may transition to mid-size customers, and customer count includes these changes resulting from any recharacterization. As of October 31, 2024, customer count was over 3,000.

Components of Results of Operations

Revenue

We derive our revenue primarily from subscription and associated support to our platform. Our contracts are typically one year in length, but may be up to three years or longer in length. Revenue is a function of the number of customers, the number of licenses or capacity purchased by each customer, the package to which each customer subscribes, the price of the package and renewal rates. Revenue is generally recognized ratably over the contract term beginning on the commencement date of each contract, which is the date our platform is made available to customers. At the beginning of each subscription term we invoice our customers, typically in annual installments, but also monthly, quarterly, and semi-annually. Amounts that have been invoiced for non-cancelable contracts are recorded in accounts receivable and unearned revenue. Unearned revenue is subsequently recognized as revenue when transfer of control to a customer has occurred.

Cost of Revenue

Cost of revenue consists primarily of employee-related costs, including personnel-related costs, which mainly consist of salaries and wages, and stock-based compensation expense. Cost of revenue also includes fees associated with our Publisher Network application provider arrangements, the nature of which may be unpaid, fixed, or variable, and are unpaid with many of our larger providers, as well as the costs associated with our data centers. In addition, cost of revenue includes depreciation expense, which includes amounts allocated based on employee headcount, as well as amounts related to certain capitalized software development costs incurred in connection with additional functionality to our platform. Cost of revenue also includes amortization expense, which includes amounts related to intangible assets arising from acquisitions and lease expenses associated with our office spaces, which are allocated based on employee headcount. In addition, cost of revenue includes software expense, which relates to licenses, professional services, and other costs associated with software for use in the operations of our business, which is also allocated based on employee headcount.

Operating Expenses

Sales and marketing expenses. Sales and marketing expenses consist primarily of employee-related costs which are comprised of personnel-related costs and stock-based compensation expense. Personnel-related costs mainly consist of salaries and wages and costs of obtaining revenue contracts. Sales and marketing expenses also include lease expenses associated with our office spaces, as well as software expense, each of which are allocated based on employee headcount. In addition, sales and marketing expenses include amortization expense, which includes amounts related to intangible assets arising from acquisitions, as well as costs related to advertising and conferences and brand awareness events.

Research and development expenses. Research and development expenses consist primarily of employee-related costs which are comprised of personnel-related costs and stock-based compensation expense. Personnel-related costs mainly consist of salaries and wages. Capitalized software development costs related to additional functionality to our platform are excluded from research and development expenses as they are capitalized as a component of property and equipment, net and depreciated to cost of revenue over the term of their useful life. Research and development expenses also include data centers costs associated with pre-production costs for testing and quality assurance, as well as lease expenses associated with our office spaces, and software expense, each of which are allocated based on employee headcount.

General and administrative expenses. General and administrative expenses consist primarily of employee-related costs which are comprised of personnel-related costs and stock-based compensation expense for our finance and accounting, human resources, information technology and legal support departments. Personnel-related costs mainly consist of salaries and wages. General and administrative expenses also include lease expenses associated with our office spaces, as well as software expense, each of which are allocated based on employee headcount. In addition, general and administrative expenses include other professional related costs which include acquisition-related costs, as well as fair value adjustments related to contingent consideration.

Results of Operations

The following table sets forth selected condensed consolidated statement of operations data for each of the periods indicated:


	Three months ended October 31,				Nine months ended October 31,
(in thousands)	2024		2023		2024		2023
Revenue	$	113,989	$	101,164	$	307,866	$	303,215
Cost of revenue(1)	26,247		22,066		70,086		65,809
Gross profit	87,742		79,098		237,780		237,406
Operating expenses:
Sales and marketing(1)	43,667		45,355		128,878		136,942
Research and development(1)	21,070		18,291		56,709		53,934
General and administrative(1)	33,373		17,233		75,553		53,774
Total operating expenses	98,110		80,879		261,140		244,650
Loss from operations	(10,368)		(1,781)		(23,360)		(7,244)
Interest income	823		1,922		5,578		5,296
Interest expense	(222)		(173)		(738)		(334)
Other expense, net	(55)		(70)		(397)		(687)
Loss from operations before income taxes	(9,822)		(102)		(18,917)		(2,969)
Provision for income taxes	(2,977)		(366)		(1,756)		(1,348)
Net loss	$	(12,799)	$	(468)	$	(20,673)	$	(4,317)

(1)See Note 10 "Stock-Based Compensation", to the condensed consolidated financial statements for amounts included.

The following table sets forth selected condensed consolidated statements of operations data for each of the periods indicated as a percentage of total revenue: