UPLAND SOFTWARE, INC., 10-Q filed on 5/2/2024
Quarterly Report
v3.24.1.u1
Cover - shares
 3 Months Ended
Mar. 31, 2024
Apr. 30, 2024
Document Information [Line Items]    
Document Type 10-Q  
Document Quarterly Report true  
Document Period End Date Mar. 31, 2024  
Document Transition Report false  
Entity File Number 001-36720  
Entity Registrant Name UPLAND SOFTWARE, INC.  
Entity Incorporation, State or Country Code DE  
Entity Tax Identification Number 27-2992077  
Entity Address, Address Line One 401 Congress Ave., Suite 1850  
Entity Address, City or Town Austin  
Entity Address, State or Province TX  
Entity Address, Postal Zip Code 78701  
City Area Code 512  
Local Phone Number 960-1010  
Entity Current Reporting Status Yes  
Entity Interactive Data Current Yes  
Entity Filer Category Accelerated Filer  
Entity Small Business false  
Entity Emerging Growth Company false  
Entity Shell Company false  
Entity Common Stock, Shares Outstanding   27,592,899
Entity Central Index Key 0001505155  
Current Fiscal Year End Date --12-31  
Document Fiscal Year Focus 2024  
Document Fiscal Period Focus Q1  
Amendment Flag false  
Common Stock    
Document Information [Line Items]    
Title of 12(b) Security Common Stock, par value $0.0001 per share  
Trading Symbol UPLD  
Security Exchange Name NASDAQ  
Preferred Stock Purchase Rights    
Document Information [Line Items]    
Title of 12(b) Security Preferred Stock Purchase Rights  
No Trading Symbol Flag true  
Security Exchange Name NASDAQ  
v3.24.1.u1
Condensed Consolidated Balance Sheets - USD ($)
$ in Thousands
Mar. 31, 2024
Dec. 31, 2023
Current assets:    
Cash and cash equivalents $ 231,614 $ 236,559
Accounts receivable (net of allowance of $389 and $572 at March 31, 2024, and December 31, 2023, respectively) 29,253 38,765
Deferred commissions, current 9,678 10,429
Unbilled receivables 3,213 2,701
Income tax receivable, current 5,221 3,775
Prepaid expenses and other current assets 10,215 8,004
Total current assets 289,194 300,233
Tax credits receivable 1,553 1,657
Property and equipment, net 1,803 1,932
Operating lease right-of-use asset 2,480 2,929
Intangible assets, net 166,988 182,349
Goodwill 264,012 353,778
Deferred commissions, noncurrent 12,593 12,568
Interest rate swap assets 15,889 14,270
Other assets 434 308
Total assets 754,946 870,024
Current liabilities:    
Accounts payable 4,642 8,137
Accrued compensation 7,083 7,174
Accrued expenses and other current liabilities 6,770 7,050
Deferred revenue 99,550 102,763
Operating lease liabilities, current 2,073 2,351
Current maturities of notes payable (includes unamortized discount of $2,143 and $2,228 at March 31, 2024, and December 31, 2023, respectively) 3,257 3,172
Total current liabilities 123,375 130,647
Notes payable, less current maturities (includes unamortized discount of $2,657 and $3,148 at March 31, 2024, and December 31, 2023, respectively) 472,642 473,502
Deferred revenue, noncurrent 3,428 3,860
Operating lease liabilities, noncurrent 1,224 1,597
Noncurrent deferred tax liability, net 14,696 16,025
Other long-term liabilities 447 461
Total liabilities 615,812 626,092
Mezzanine Equity    
Series A Convertible Preferred stock, $0.0001 par value; 5,000,000 shares authorized; 115,000 shares issued and outstanding as of March 31, 2024, and December 31, 2023, respectively 119,013 117,638
Stockholders’ equity:    
Common stock, $0.0001 par value; 75,000,000 shares authorized; 27,996,656 and 29,908,407 shares issued and outstanding as of March 31, 2024, and December 31, 2023, respectively 3 3
Additional paid-in capital 602,813 608,995
Accumulated other comprehensive income 2,307 6,168
Accumulated deficit (585,002) (488,872)
Total stockholders’ equity 20,121 126,294
Total liabilities, convertible preferred stock and stockholders’ equity $ 754,946 $ 870,024
Common stock authorized (in shares) 75,000,000 75,000,000
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Condensed Consolidated Balance Sheets (Parenthetical) - USD ($)
$ in Thousands
Mar. 31, 2024
Dec. 31, 2023
Statement of Financial Position [Abstract]    
Accounts receivable, allowance for credit loss, current $ 389 $ 572
Unamortized discount, current 2,143 2,228
Unamortized discount, noncurrent $ 2,657 $ 3,148
Series A convertible preferred stock, par value (in dollars per share) $ 0.0001 $ 0.0001
Series A convertible preferred stock, authorized (in shares) 5,000,000 5,000,000
Series A convertible preferred stock, issued (in shares) 115,000 115,000
Series A convertible preferred stock, outstanding (in shares) 115,000 115,000
Common stock, par value (in dollars per share) $ 0.0001 $ 0.0001
Common stock authorized (in shares) 75,000,000 75,000,000
Common stock issued (in shares) 27,996,656 29,908,407
Common stock outstanding (in shares) 27,996,656 29,908,407
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Condensed Consolidated Statements of Operations (unaudited) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Revenue $ 70,736 $ 77,056
Cost of revenue 21,049 25,536
Gross profit 49,687 51,520
Operating expenses:    
Sales and marketing 17,018 14,289
Research and development 12,455 12,530
General and administrative 13,232 17,189
Depreciation and amortization 11,396 15,094
Acquisition-related expenses 0 1,094
Impairment of goodwill 87,227 128,755
Total operating expenses 141,328 188,951
Loss from operations (91,641) (137,431)
Other expense:    
Interest expense, net (4,958) (5,461)
Other income (expense), net (78) 1,425
Total other expense (5,036) (4,036)
Loss before benefit from income taxes (96,677) (141,467)
Benefit from income taxes 547 1,422
Net loss (96,130) (140,045)
Preferred stock dividends (1,375) (1,315)
Net loss attributable to common stockholders, basic (97,505) (141,360)
Net loss attributable to common stockholders, diluted $ (97,505) $ (141,360)
Net loss per common share:    
Net loss per common share, basic (in dollars per share) $ (3.37) $ (4.38)
Net loss per common share, diluted (in dollars per share) $ (3.37) $ (4.38)
Weighted-average common shares outstanding, basic (in shares) 28,917,897 32,259,110
Weighted-average common shares outstanding, diluted (in shares) 28,917,897 32,259,110
Total product revenue    
Revenue $ 68,548 $ 74,485
Subscription and support    
Revenue 67,078 72,914
Cost of revenue 19,829 23,485
Perpetual license    
Revenue 1,470 1,571
Professional services    
Revenue 2,188 2,571
Cost of revenue $ 1,220 $ 2,051
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Condensed Consolidated Statements of Comprehensive Loss (unaudited) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Statement of Comprehensive Income [Abstract]    
Net loss $ (96,130) $ (140,045)
Other comprehensive income (loss):    
Foreign currency translation adjustment (2,611) 15
Unrealized translation gain (loss) on foreign currency denominated intercompany loans, net of taxes (1,412) 1,235
Interest rate swaps 162 (8,154)
Other comprehensive loss: (3,861) (6,904)
Comprehensive loss $ (99,991) $ (146,949)
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Condensed Consolidated Statements of Equity (unaudited) - USD ($)
$ in Thousands
Total
Common Stock
Additional Paid-In Capital
Accumulated Other Comprehensive Income (Loss)
Accumulated Deficit
Beginning balance (in shares) at Dec. 31, 2022 115,000        
Beginning balance at Dec. 31, 2022 $ 112,291        
Increase (Decrease) in Temporary Equity [Roll Forward]          
Dividends accrued - Convertible Preferred Stock $ 1,315        
Ending balance (in shares) at Mar. 31, 2023 115,000        
Ending balance at Mar. 31, 2023 $ 113,606        
Beginning balance (in shares) at Dec. 31, 2022   32,221,855      
Beginning balance at Dec. 31, 2022 308,870 $ 3 $ 606,755 $ 11,110 $ (308,998)
Increase (Decrease) in Stockholders' Equity [Roll Forward]          
Dividends accrued - Convertible Preferred Stock (1,315)   (1,315)    
Issuance of stock under Company plans, net of shares withheld for tax (in shares)   219,155      
Issuance of stock under Company plans, net of shares withheld for tax (235)   (235)    
Stock-based compensation 6,462   6,462    
Foreign currency translation adjustment 15     15  
Unrealized translation gain (loss) on intercompany loans with foreign subsidiaries 1,235     1,235  
Interest rate swaps (8,154)     (8,154)  
Net loss (140,045)       (140,045)
Ending balance (in shares) at Mar. 31, 2023   32,441,010      
Ending balance at Mar. 31, 2023 $ 166,833 $ 3 611,667 4,206 (449,043)
Beginning balance (in shares) at Dec. 31, 2023 115,000        
Beginning balance at Dec. 31, 2023 $ 117,638        
Increase (Decrease) in Temporary Equity [Roll Forward]          
Dividends accrued - Convertible Preferred Stock $ 1,375        
Ending balance (in shares) at Mar. 31, 2024 115,000        
Ending balance at Mar. 31, 2024 $ 119,013        
Beginning balance (in shares) at Dec. 31, 2023 29,908,407 29,908,407      
Beginning balance at Dec. 31, 2023 $ 126,294 $ 3 608,995 6,168 (488,872)
Increase (Decrease) in Stockholders' Equity [Roll Forward]          
Dividends accrued - Convertible Preferred Stock (1,375)   (1,375)    
Issuance of stock under Company plans, net of shares withheld for tax (in shares)   330,903      
Issuance of stock under Company plans, net of shares withheld for tax (331)   (331)    
Stock repurchases and retirements (in shares)   (2,242,654)      
Stock repurchases and retirements (7,998)   (7,998)    
Stock-based compensation 3,522   3,522    
Foreign currency translation adjustment (2,611)     (2,611)  
Unrealized translation gain (loss) on intercompany loans with foreign subsidiaries (1,412)     (1,412)  
Interest rate swaps 162     162  
Net loss $ (96,130)       (96,130)
Ending balance (in shares) at Mar. 31, 2024 27,996,656 27,996,656      
Ending balance at Mar. 31, 2024 $ 20,121 $ 3 $ 602,813 $ 2,307 $ (585,002)
v3.24.1.u1
Condensed Consolidated Statements of Cash Flows (unaudited) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Operating activities    
Net loss $ (96,130) $ (140,045)
Adjustments to reconcile net loss to net cash provided by operating activities:    
Depreciation and amortization 13,802 18,500
Deferred income taxes (1,057) (1,975)
Amortization of deferred costs 3,047 3,352
Foreign currency re-measurement loss (164) (859)
Non-cash interest, net and other income, net (882) 573
Non-cash stock-based compensation expense 3,522 6,462
Non-cash loss on impairment of goodwill 87,227 128,755
Changes in operating assets and liabilities, net of purchase business combinations:    
Accounts receivable 9,361 6,991
Prepaid expenses and other current assets (4,117) (2,362)
Other assets (2,608) (2,483)
Accounts payable (3,459) (184)
Accrued expenses and other liabilities (389) (859)
Deferred revenue (3,032) (41)
Net cash provided by operating activities 5,121 15,825
Investing activities    
Purchase of property and equipment (183) (215)
Net cash used in investing activities (183) (215)
Financing activities    
Payments of debt costs 0 (130)
Payments on notes payable (1,350) (1,350)
Stock repurchases and retirement (7,918) 0
Taxes paid related to net share settlement of equity awards (331) (235)
Additional consideration paid to sellers of businesses 0 (5,066)
Net cash used in financing activities (9,599) (6,781)
Effect of exchange rate fluctuations on cash (284) 238
Change in cash and cash equivalents (4,945) 9,067
Cash and cash equivalents, beginning of period 236,559 248,653
Cash and cash equivalents, end of period 231,614 257,720
Supplemental disclosures of cash flow information:    
Cash paid for interest, net of interest rate swaps 8,720 7,134
Cash paid for taxes $ 2,114 $ 2,507
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Organization and Nature of Operations
 3 Months Ended
Mar. 31, 2024
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Organization and Nature of Operations
1. Organization and Nature of Operations
Upland Software, Inc. (“Upland,” “we,” “us,” “our,” or the “Company”), a Delaware corporation, enables global businesses to work smarter with over 25 cloud software products that help increase revenue, reduce costs, and deliver business value. Upland's solutions cover digital marketing, knowledge management, contact center service, sales productivity, and content lifecycle automation. Upland services over 10,000 customers ranging from large global corporations and various government agencies to small and medium-sized businesses. The Company's customers operate in a wide variety of industries, including financial services, consulting services, technology, manufacturing, media, telecommunications, government, insurance, non-profit, healthcare, life sciences, retail, and hospitality.
Through a series of acquisitions and integrations, the Company has established a library of diverse software applications under the Upland brand that address specific digital transformation needs. In addition to its strategy to increase core organic growth, Upland intends to pursue acquisitions within its cloud offerings of complementary technologies and businesses. Upland expects that this will expand its product offerings, customer base and market access, resulting in increased benefits of scale.
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Basis of Presentation and Summary of Significant Accounting Policies
 3 Months Ended
Mar. 31, 2024
Accounting Policies [Abstract]  
Basis of Presentation and Summary of Significant Accounting Policies
2. Basis of Presentation and Summary of Significant Accounting Policies
Basis of Presentation
These condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States (“GAAP”). The condensed consolidated financial statements include the accounts of Upland Software, Inc. and its wholly owned subsidiaries (collectively referred to as “Upland”, the “Company”, “we”, “us” or “our”). All intercompany accounts and transactions have been eliminated in consolidation. No material changes have been made to the Company’s significant accounting policies disclosed in Note 2, Basis of Presentation and Summary of Significant Accounting Policies, in our Annual Report.
The accompanying unaudited interim condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim financial reporting. In the opinion of management of the Company, the unaudited interim condensed consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements, in all material respects, and include all adjustments of a normal recurring nature necessary for a fair presentation. The results of operations for the three months ended March 31, 2024 are not necessarily indicative of the results to be expected for the year ending December 31, 2024 or for any other period.
The financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s 2023 Annual Report on Form 10-K filed with the SEC on February 22, 2024.
Use of Estimates
The preparation of the accompanying condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements, and the reported amounts of revenues and expenses. Significant items subject to such estimates include those related to revenue recognition, deferred commissions, allowance for credit losses, stock-based compensation, contingent consideration, acquired intangible assets, impairment of goodwill, intangibles and long-lived assets, the useful lives of intangible assets and property and equipment, the fair value of the Company’s interest rate swaps and income taxes. In accordance with GAAP, management bases its estimates on historical experience and on various other assumptions that management believes are reasonable under the circumstances. Management regularly evaluates its estimates and assumptions using historical experience and other factors; however, actual results could differ from those estimates.
Upland is not aware of any specific event or circumstance that would require an update to its estimates or judgments or a revision of the carrying value of its assets or liabilities as of May 2, 2024, the date of issuance of this Quarterly Report on Form 10-Q. These estimates may change as new events occur and additional information is obtained. Actual results could differ materially from these estimates under different assumptions or conditions.
Concentrations of Credit Risk and Significant Customers
Financial instruments that potentially subject the Company to credit risk consist of cash and cash equivalents, accounts receivable and the Company’s interest rate swap hedges. The Company’s cash and cash equivalents are placed with high quality financial institutions, which, at times, may exceed federally insured limits. The Company has not experienced any losses in these accounts, and the Company does not believe it is exposed to any significant credit risk related to cash and cash equivalents. The Company provides credit, in the normal course of business, to a number of its customers and generally does not require collateral. To manage accounts receivable credit risk, the Company performs periodic credit evaluations of its customers and maintains current expected credit losses which considers such factors as historical loss information, geographic location of customers, current market conditions, and reasonable and supportable forecasts.
No individual customer represented more than 10% of total revenues for the three months ended March 31, 2024, or more than 10% of accounts receivable as of March 31, 2024 or December 31, 2023.
Recent Accounting Pronouncements
Recently issued accounting pronouncements - Not Adopted
In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which requires public entities to disclose information about their reportable segments' significant expenses and other segment items on an interim and annual basis. Public entities with a single reportable segment are required to apply the disclosure requirements in ASU 2023-07, as well as all existing segment disclosures and reconciliation requirements in ASC 280 on an interim and annual basis. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and for interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. ASU 2023-07 should be applied on a retrospective basis. The Company is currently evaluating the impact of adopting ASU 2023-07 on its disclosures.
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires public entities, on an annual basis, to provide disclosure of specific categories in the rate reconciliation, as well as disclosure of income taxes paid disaggregated by jurisdiction. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024, with early adoption permitted. ASU 2023-09 should be applied on a prospective basis, and retrospective application is permitted. The Company is currently evaluating the impact of adopting ASU 2023-09 on its disclosures.
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Fair Value Measurements
 3 Months Ended
Mar. 31, 2024
Fair Value Disclosures [Abstract]  
Fair Value Measurements
3. Fair Value Measurements
The Company recognizes financial instruments in accordance with the authoritative guidance on fair value measurements and disclosures for financial assets and liabilities. This guidance defines fair value, establishes a framework for measuring fair value in accordance with GAAP, and expands disclosures about fair value measurements. The guidance also establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value.
These tiers include Level 1, defined as observable inputs, such as quoted prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs in which little or no market data exists, therefore, requiring an entity to develop its own assumptions.
The Company’s financial instruments consist principally of cash and cash equivalents, money market funds, accounts receivable, accounts payable, interest rate swap hedges, and debt. The carrying value of cash and cash equivalents, accounts receivable, and accounts payable approximate fair value, primarily due to short maturities.
Assets measured at fair value on a recurring basis are summarized below (in thousands):
 Fair Value Measurements at March 31, 2024
(unaudited)
 Level 1Level 2Level 3Total
Assets:
Money market funds included in cash and cash equivalents$206,058 $— $— $206,058 
Interest rate swaps— 15,889 — 15,889 
Total$206,058 $15,889 $— $221,947 

 Fair Value Measurements at December 31, 2023
 Level 1Level 2Level 3Total
Assets:
Money market funds included in cash and cash equivalents$211,661 $— $— $211,661 
Interest rate swaps— 14,270 — 14,270 
Total$211,661 $14,270 $— $225,931 
Money market funds included in cash and cash equivalents are highly-liquid investments and are measured at fair value using quoted market prices and active markets, therefore are categorized as Level 1.
The fair value of the Company's interest rate swaps are measured at the end of each interim reporting period based on the then assessed fair value and adjusted if necessary. As the fair value measure is based on the market approach, they are categorized as Level 2.
Debt
The Company believes the carrying value of its long-term debt at March 31, 2024 approximates its fair value based on its variable interest rate feature and interest rates currently available to the Company. The estimated fair value of the Company's debt, before debt discount, at March 31, 2024 and December 31, 2023 was $480.7 million and $482.1 million, respectively, based on valuation methodologies using interest rates currently available to the Company which are Level 2 inputs..
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Goodwill and Other Intangible Assets
 3 Months Ended
Mar. 31, 2024
Goodwill and Intangible Assets Disclosure [Abstract]  
Goodwill and Other Intangible Assets 4. Goodwill and Other Intangible Assets
Changes in the Company’s goodwill balance for the three months ended March 31, 2024 are summarized in the table below (in thousands):
Balance at December 31, 2023$353,778 
Impairment of goodwill(87,227)
Foreign currency translation adjustment(2,539)
Balance at March 31, 2024$264,012 
As a result of the decline of our stock price impacting our market capitalization during the quarters ended March 31, 2024 and March 31, 2023, we performed quantitative impairment evaluations, which resulted in goodwill impairments of $87.2 million and $128.8 million, respectively. Our quantitative goodwill impairment analysis applied two methodologies to estimate the Company’s fair value which were: a) a discounted cash flow method and b) a guideline public company method. The two methods indicated that the fair value of the Company was less than its carrying value. The discounted cash flow method required significant judgments, including estimation of future cash flows, which is dependent on internally developed forecasts, estimation of the long-term rate of growth for our business, and determination of our weighted average cost of capital. Under the guideline public company method, we estimated fair value based on a market multiple of revenues and earnings derived for comparable publicly traded companies with similar operating characteristics as the Company. We will continue to evaluate Goodwill for impairment and adjust as indicators arise.
Intangible assets, net include the estimated acquisition-date fair values of customer relationships, marketing-related assets, and developed technology that the Company recorded as part of its business acquisitions.
The following is a summary of the Company’s intangible assets, net (in thousands):
Estimated Useful
Life (Years)		Gross
Carrying Amount		Accumulated
Amortization		Net Carrying
Amount
March 31, 2024:(unaudited)
Customer relationships
1-10
$354,070 $210,034 $144,036 
Trade name
1.5-10
9,467 7,532 1,935 
Developed technology
4-9
86,948 66,107 20,841 
Favorable Leases6.3274 98 176 
Total intangible assets$450,759 $283,771 $166,988 
Estimated Useful
Life (Years)		Gross
Carrying Amount		Accumulated
Amortization		Net Carrying
Amount
December 31, 2023:
Customer relationships
1-10
$378,923 $222,436 $156,487 
Trade name
1.5-10
10,012 7,862 2,150 
Developed technology
4-9
94,103 70,582 23,521 
Favorable Leases6.3280 89 191 
Total intangible assets$483,318 $300,969 $182,349 
Management recorded no impairments of intangible assets during the three months ended March 31, 2024 and March 31, 2023.
The Company periodically reviews the estimated useful lives of its identifiable intangible assets, taking into consideration any events or circumstances that might result in either a diminished fair value or revised useful life.
Total amortization expense was $13.5 million and $18.2 million during the three months ended March 31, 2024 and March 31, 2023, respectively.
As of March 31, 2024, the estimated annual amortization expense for the next five years and thereafter is as follows (in thousands):
Amortization
Expense
Year ending December 31:
Remainder of 2024$40,297 
202538,796 
202636,572 
202727,680 
202817,999 
2029 and thereafter5,644 
Total$166,988 
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Income Taxes
 3 Months Ended
Mar. 31, 2024
Income Tax Disclosure [Abstract]  
Income Taxes
5. Income Taxes
The Company’s income tax benefit for the three months ended March 31, 2024 and March 31, 2023 reflects its estimate of the effective tax rates expected to be applicable for the full years, adjusted for any discrete events that are recorded in the period in which they occur. The estimates are re-evaluated each quarter based on the estimated tax expense for the full year.
The income tax benefit of $0.5 million and $1.4 million for the three months ended March 31, 2024 and March 31, 2023, respectively, is primarily related to the deferred tax impacts of the goodwill impairments booked during the first quarter of 2024 and 2023, respectively. The tax benefit is offset by the foreign income taxes associated with our combined non U.S.
operations, changes in deferred tax liabilities associated with amortization of United States tax deductible goodwill, and state taxes in certain states in which the Company does not file on a consolidated basis or have net operating loss carryforwards.
The Company historically incurred operating losses in the United States prior to 2021 and, given its cumulative losses and limited history of profits, has recorded a valuation allowance against its United States net deferred tax assets, exclusive of tax deductible goodwill, at March 31, 2024 and December 31, 2023, respectively.
The Company has reflected uncertain tax positions primarily within its long-term taxes payable and a portion within deferred tax assets for which the balance is immaterial at March 31, 2024. The Company and its subsidiaries file tax returns in the U.S. federal jurisdiction, several U.S. state jurisdictions and several foreign jurisdictions. The Company is no longer subject to U.S. federal income tax examinations for years ending before December 31, 2020 and is no longer subject to state and local or foreign income tax examinations by tax authorities for years ending before December 31, 2019, other than where cross-border transactions extend the statute of limitations. The Company is not currently under audit in any federal, state or any foreign jurisdictions. U.S. operating losses generated in years prior to 2020 remain open to adjustment until the statute of limitations closes for the tax year in which the net operating losses are utilized.
v3.24.1.u1
Debt
 3 Months Ended
Mar. 31, 2024
Debt Disclosure [Abstract]  
Debt
6. Debt
Long-term debt consisted of the following at March 31, 2024 and December 31, 2023 (in thousands):
March 31, 2024December 31, 2023
Senior secured loans (includes unamortized discount of $4,800 and $5,376 based on an imputed interest rate of 7.6% and 7.6%, at March 31, 2024 and December 31, 2023, respectively)
$475,899 $476,674 
Less current maturities(3,257)(3,172)
Total long-term debt$472,642 $473,502 

In 2019, the Company entered into a credit agreement (the “Credit Facility”) which provides for (i) fully-drawn, 7 year, senior secured term loans (the “Term Loans”) and (ii) a $60 million, 5 year, revolving credit facility (the “Revolver”) that was undrawn as of March 31, 2024.
The Term Loans are repayable on a quarterly basis beginning on December 31, 2019 by an amount equal to 0.25% (1.00% per annum) of the aggregate principal amount of such loan. Any amount remaining unpaid is due and payable in full on August 6, 2026 (the “Term Loan Maturity Date”).
At the option of the Company, the Term Loans accrue interest at a per annum rate based on (i) the Base Rate (as defined below) plus a margin of 2.75% or (ii) the rate (not less than 0.00%) published by CME Group Benchmark Administration Limited (CBA), or as otherwise determined in accordance with the Credit Facility (based on a period equal to 1, 2, 3 or 6 months or, if available and agreed to by all relevant Lenders and the Agent, 12 months or such period of less than 1 month) plus a margin of 3.75%. The Base Rate for any day is a rate per annum equal to the greatest of (i) the prime rate in effect on such day, (ii) the Federal Funds Effective Rate (not less than 0.00%) in effect on such day plus ½ of 1.00%, and (iii) the Federal Funds Effective Rate for a one month interest period beginning on such day plus 1.00%. After giving effect to the interest rate swaps described below, $257.9 million of the Term Loans outstanding at March 31, 2024 has an effective annualized fixed interest rate of 5.4%, and the remaining principal outstanding at March 31, 2024 has a floating interest rate of 9.2%. Accrued interest is paid quarterly or, with respect to Term Loans that are accruing interest based on the Federal Funds Effective Rate, at the end of the applicable interest rate period.
Loans under the Revolver are available up to $60 million. The Revolver provides a sub-facility whereby the Company may request letters of credit (the “Letters of Credit”) in an aggregate amount not to exceed, at any one time outstanding, $10 million for the Company. The aggregate amount of outstanding Letters of Credit are reserved against the credit availability under the Maximum Revolver Amount. As of March 31, 2024, the Company had no borrowings outstanding under the Revolver or related sub-facility.
The Company incurs a 0.50% per annum unused line fee on the unborrowed balance of the Revolver which is paid quarterly. Loans under the Revolver may be borrowed, repaid and reborrowed until August 6, 2024 (the “Maturity Date”), at which time all amounts borrowed under the Revolver must be repaid.
Covenants
The Credit Facility contains customary affirmative and negative covenants.
The Credit Facility has no financial covenants as long as less than 35% of the Revolver is drawn as of the last day of any fiscal quarter. If 35% of the Revolver is drawn as of the last day of a given fiscal quarter the Company will be required to maintain a Total Leverage Ratio (the ratio of funded indebtedness as of such date less the amount of unrestricted cash and cash equivalents of the Company and its guarantors in an amount not to exceed $50.0 million, to adjusted EBITDA (calculated on a pro forma basis including giving effect to any acquisition)), measured on a quarter-end basis for each four consecutive fiscal quarters then ended, of not greater than 6.00 to 1.00.
In addition, the Credit Facility contains customary events of default subject to customary cure periods. The occurrence of an event of default could result in the acceleration of the Term Loans and Revolver and a right by the agent and lenders to exercise remedies. At the election of the lenders, a default interest rate shall apply on all obligations during an event of default, at a rate per annum equal to 2.00% above the applicable interest rate. The Term Loans and Revolver are secured by substantially all of the Company's assets.
As of March 31, 2024 the Company was in compliance with all covenants under the Credit Facility.
Interest rate swaps
In 2019, the Company entered into floating-to-fixed interest rate swap agreements to limit exposure to interest rate risk related to our debt, effectively converting the entire balance of the Company's Term Loans from variable interest payments to fixed interest rate payments, based on an annualized fixed rate of 5.4%, for the 7-year term of debt. The interest rate associated with our undrawn $60 million Revolver remains floating.
In August 2023, the Company sold a portion of the notional amount of its interest rate swap assets back to the counterparties for $20.5 million. At that time, a $20.5 million gain was recorded in accumulated other comprehensive income related to the notional amount sold. That gain is being released to interest expense, net as interest is accrued on the Company’s variable-rate debt over the remaining term of the Term Loans as a decrease to interest expense, net, the amortization of which totaled $1.5 million for the three months ended March 31, 2024.
As of March 31, 2024, $257.9 million of the Term Loans have an effective annualized fixed interest rate of 5.4% due to the floating-to-fixed interest rate swaps, and the remaining principal has a floating interest rate as described above.
Amounts reported in accumulated other comprehensive income related to the Company's derivatives are reclassified to interest expense, net as interest is accrued on the Company’s variable-rate debt. The impact of the Company’s derivative financial instruments on its condensed consolidated statements of comprehensive (loss) income for the three months ended March 31, 2024 and March 31, 2023 was as follows (in thousands):
Three Months Ended March 31,
20242023
Unrealized gain (loss) recognized in Other comprehensive income (loss) on interest rate swaps1,619 $(8,154)
Amounts reclassified from Accumulated other comprehensive income (loss) to interest expense, net(1,457)— 
Total Other comprehensive income (loss) on interest rate swaps$162 $(8,154)
Cash interest costs averaged 7.2% and 5.4% for the three months ended March 31, 2024 and 2023, respectively. In addition, as of March 31, 2024 and December 31, 2023 the Company had $4.8 million and $5.4 million, respectively, of unamortized deferred financing costs associated with the Credit Facility. These financing costs will be amortized to non-cash interest expense over the remaining term of the Credit Facility.
v3.24.1.u1
Net Loss Per Share
 3 Months Ended
Mar. 31, 2024
Earnings Per Share [Abstract]  
Net Loss Per Share
7. Net Loss Per Share
We compute loss per share of our common stock, par value $0.0001 per share (“Common Stock”) and Series A Preferred Stock , par value $0.0001 per share (“Series A Preferred Stock”) using the two-class method. The two-class method requires income available to common stockholders for the period to be allocated between Common Stock and participating securities based upon their respective rights to receive dividends as if all income for the period had been distributed. We consider our Series A Preferred Stock to be a participating security, as its holders are entitled to fully participate in any dividends or other distributions declared or paid on our Common Stock on an as-converted basis.
The following table sets forth the computations of loss per share (in thousands, except share and per share amounts):
Three Months Ended March 31,
20242023
Numerator:
Net Loss$(96,130)$(140,045)
Preferred stock dividends and accretion(1,375)(1,315)
Net loss attributable to common stockholders$(97,505)$(141,360)
Denominator:
Weighted–average common shares outstanding, basic and diluted28,917,897 32,259,110 
Net loss per common share, basic and diluted$(3.37)$(4.38)
Due to the net losses for the three months ended March 31, 2024 and March 31, 2023, respectively, basic and diluted loss per share were the same. The Company uses the application of the if-converted method for calculating diluted earnings per share on our Series A Preferred Stock. The Company applies the treasury stock method for calculating diluted earnings per share on our stock options, restricted stock units and performance restricted stock units.
The following table sets forth the anti–dilutive common share equivalents as of:
 March 31,
 20242023
 
Stock options141,699 152,683 
Restricted stock units
2,937,337 2,507,689 
Performance restricted stock units350,000 193,750 
Series A Preferred Stock on an if-converted basis(1)
7,061,046 6,752,038 
Total anti–dilutive common share equivalents10,490,082 9,606,160 
(1) As of March 31, 2024, the Series A Preferred Stock plus accumulated dividends totaled $123.6 million. The Series A Preferred Stock has a conversion price of $17.50 per share, as detailed in “Note 9. Series A Convertible Preferred Stock”.
v3.24.1.u1
Commitments and Contingencies
 3 Months Ended
Mar. 31, 2024
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies
8. Commitments and Contingencies
Purchase Commitments
The Company has purchase commitments related to hosting services, third-party technology used in the Company's solutions and for other services the Company purchases as part of normal operations. In certain cases these arrangements require a minimum annual purchase commitment.
Litigation
In the normal course of business, the Company is involved in various lawsuits and legal proceedings. The Company does not anticipate that any current or pending legal proceedings will have a material adverse effect on the Company's condensed consolidated balances sheets or condensed consolidated statements of operations.
v3.24.1.u1
Series A Convertible Preferred Stock
 3 Months Ended
Mar. 31, 2024
Temporary Equity Disclosure [Abstract]  
Series A Convertible Preferred Stock
9. Series A Convertible Preferred Stock
On July 14, 2022, the Company entered into a Securities Purchase Agreement (the “Purchase Agreement”) with Ulysses Aggregator, LP (the “Purchaser”), an affiliate of HGGC, LLC, to issue and sell at closing 115,000 shares of Series A Preferred Stock of the Company, par value $0.0001 per share, at a price of $1,000 per share (the “Initial Liquidation Preference”) for an aggregate purchase price of $115.0 million (the “Investment”). The Company is using the proceeds of the Investment for general corporate purposes and for transaction-related fees and expenses.
On August 23, 2022 (the “Closing Date”), the closing of the Investment (the “Closing”) occurred, and the Series A Preferred Stock was issued to the Purchaser. In connection with the issuance of the Series A Preferred Stock, the Company incurred direct and incremental expenses comprised of transaction fees, and financial advisory and legal expenses (the “Series A Preferred Stock Issuance Costs”), which reduced the carrying value of the Series A Preferred Stock. As of March 31, 2024, the Series A Preferred Stock Issuance Costs totaled $4.6 million.
Contemporaneous with the Closing Date, the Company and the Purchaser entered into a Registration Rights Agreement (the “Registration Rights Agreement”) and the Company filed a Certificate of Designation (the “Certificate of Designation”) setting out the powers, designations, preferences, and other rights of the Series A Preferred Stock with the Secretary of State of the State of Delaware in connection with the Closing. Pursuant to the Registration Rights Agreement, the Purchaser has certain customary registration rights with respect to any shares of Series A Preferred Stock or the Common Stock of the Company issuable upon conversion of the Series A Preferred Stock, including rights with respect to the filing of a shelf registration statement, underwritten offering rights and piggy back rights.
Dividend Provisions
The Series A Preferred Stock ranks senior to the Company’s Common Stock with respect to payment of dividends and rights on the distribution of assets on any liquidation, dissolution or winding up of the affairs of the Company. The Series A Preferred Stock has an Initial Liquidation Preference of $1,000 per share, representing an aggregate Liquidation Preference (as defined below) of $1,000 upon issuance. Holders of the Series A Preferred Stock are entitled to the dividend at the rate of 4.5% per annum, within the first seven years after the Closing Date regardless of whether declared or assets are legally available for the payment. Such dividends shall accrue and compound quarterly in arrears from the date of issuance of the shares. The dividend rate will increase to 7.0% on the seven-year anniversary of the Closing Date. The dividend can be paid, in the Company’s sole discretion, in cash or dividend in kind by adding to the Liquidation Preference of each share of Series A Preferred Stock outstanding. On June 7, 2023, the stockholders of the Company authorized, for purposes of complying with Nasdaq Listing Rules 5635(b) and (d), the issuance of shares of Common Stock underlying shares of Series A Preferred Stock in an amount equal to or in excess of 20% of the Common Stock outstanding immediately prior to the issuance of such Series A Preferred Stock (including upon the operation of anti-dilution provisions contained in the Certificate of Designation designating the terms of such Series A Preferred Stock). The Series A Preferred Stock is also entitled to fully participate in any dividends paid to the holders of Common Stock in cash, in stock or otherwise, on an as-converted basis. The Series A Preferred Stock had accrued unpaid dividends of $8.6 million as of March 31, 2024, representing 489,617 Common Stock shares upon conversion at $17.50 per share.
Liquidation Rights
In the event of any Liquidation, holders of the Series A Preferred Stock are entitled to receive an amount per share equal to the greater of (1) the Initial Liquidation Preference per share plus any accrued or declared but unpaid dividends on such shares (the “Liquidation Preference”) or (2) the amount payable if the Series A Preferred Stock were converted into Common Stock. The Series A Preferred Stock will have distribution and liquidation rights senior to all other equity interests of the Company. As of March 31, 2024, the Liquidation Preference of the Series A Preferred Stock was $123.6 million.
Optional Redemption
On or after the 7th anniversary of the original issue date of the Series A Preferred Stock, the Company has the right to redeem any outstanding shares of the Series A Preferred Stock for a cash purchase price equal to 105% of the Liquidation Preference plus accrued and unpaid dividends as of the date of redemption.
Deemed Liquidation Event Redemption
Upon a fundamental change, holders of the Series A Preferred Stock have the right to require the Company to repurchase any or all of its Series A Preferred Stock for cash equal to the greater of (1) 105% of the Liquidation Preference plus the present value of the dividend payments the holders would have been entitled to through the fifth anniversary of the issue date and (2) the amount that such Preferred Stock would have been entitled to receive as if converted into common shares immediately prior to the fundamental change.
A fundamental change (“Deemed Liquidation Event”) is defined as either the direct or indirect sale, lease, transfer, conveyance or other disposition of all or substantially all the properties or assets of the Company and its subsidiaries to any third party or the consummation of any transaction, the result of which is that any third party or group of third parties become the beneficial owner of more than 50% of the voting power of the Company.
Voting Rights
The Series A Preferred Stock will vote together with the common shares on all matters and not as a separate class (except as specifically provided in the Certificate of Designation or as otherwise required by law) on an as-converted basis. The holders of the Series A Preferred Stock will have the right to elect one member of the Board of Directors of the Company (the “Board of Directors”) for so long as holders of the Series A Preferred Stock own in the aggregate at least 5% of the shares of Common Stock on a fully diluted basis. In addition, the holders of the Series A Preferred Stock will have the right to elect one non-voting observer to the Board of Directors for so long as they hold at least 10% of the shares of Convertible Preferred Stock outstanding as of the date of the issue date.
Conversion Feature
The Series A Preferred Stock may be converted, at any time in whole or in part at the option of the holder into a number of shares of Common Stock equal to the quotient obtained by dividing the sum of the Liquidation Preference plus all accrued and unpaid dividends by the conversion price of $17.50 (the “Conversion Price”). The Conversion Price is subject to adjustment in the following events:
•Stock splits and combinations
•Tender offers or exchange offers
•Distribution of rights, options, or warrants at a price per share that is less than the average of the last reported sale prices per share of Common Stock for the ten consecutive trading days
•Spin-offs and other distributed property
•Issuance of equity-linked securities at a price per share less than the conversion price
Anti-Dilution Provisions
The Series A Preferred Stock has customary anti-dilution provisions for stock splits, stock dividends, mergers, sales of significant assets, and reorganization events and recapitalization transactions or similar events, and weighted average anti-dilution protection, subject to customary exceptions for issuances pursuant to current or future equity-based incentive plans or arrangements (including upon the exercise of employee stock options).
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Stockholders' Equity
 3 Months Ended
Mar. 31, 2024
Equity [Abstract]  
Stockholders' Equity
10. Stockholders' Equity
Common and Preferred Stock
The common stock has a par value of 0.0001 per share. Each share of common stock is entitled to one vote at all meetings of stockholders. The number of authorized shares of common stock may be increased or decreased (but not below the number of shares thereof then outstanding) by the affirmative vote of the holders of shares of capital stock of the Company representing a majority of the votes represented by all outstanding shares of capital stock of the Company entitled to vote. The holders of common stock are also entitled to receive dividends, when, if and as declared by our board of directors, whenever funds are legally available therefore, subject to the priority rights of any outstanding preferred stock.
See “Note 9. Series A Convertible Preferred Stock” for a description of our Series A Preferred Stock, which is the only class of preferred stock outstanding.
Share repurchase program
In 2023, the Board of Directors authorized a stock repurchase program (the “Share Repurchase Plan”) in the aggregate amount of up to $25 million that would allow the Company to repurchase shares of its issued and outstanding Common Stock, from time to time in the open market or otherwise including pursuant to a Rule 10b5-1 trading plan and in compliance with Rule10b-18 under the Exchange Act so long as the aggregate purchase price paid for such transactions does not exceed $25 million for all such purchases. The authorization does not have a specified expiration date. Accordingly, unless terminated earlier by resolution of the Board, the Share Repurchase Plan will expire when the Company has repurchased all shares authorized for repurchase.
In fiscal year 2024, the Company’s net stock repurchases are subject to a 1 percent excise tax under the Inflation Reduction Act. The excise tax is included as a reduction to accumulated deficit in the condensed consolidated statements of stockholders equity. Total accrued excise tax of $0.2 million is included in total cost of shares repurchases, excluded from average cost per share and excluded from total cash paid during the three months ended March 31, 2024 as amounts were unpaid at period end.
During the three months ended March 31, 2024, the Company repurchased and subsequently retired 2,242,654 shares of Common Stock, for a total of $7.9 million cash paid under the Share Repurchase Plan. As of March 31, 2024, approximately $2.8 million remained available for additional share repurchases. The Company is not obligated to acquire any particular amount of Common Stock and may modify or suspend the repurchases at any time in the Company’s discretion.

Tax Benefit Preservation Plan and Preferred Stock Purchase Rights
On May 2, 2023, our Board of Directors authorized and declared a dividend of one preferred stock purchase right (a “Right”) for each outstanding share of Common Stock of the Company as of May 12, 2023 (the “Record Date”). 32,441,010 Rights were issued to the holders of record of shares of Common Stock. The description and terms of the Rights are set forth in a Tax Benefit Preservation Plan, dated as of May 2, 2023, as the same may be amended from time to time (the “Plan”), between the Company and Broadridge Corporate Issuer Solutions, LLC, as Rights Agent.
By adopting the Plan, the Board of Directors is seeking to protect the Company’s ability to use its net operating loss carryforwards (“NOLs”) and other tax attributes to offset potential future income tax liabilities. The Company’s ability to use such NOLs and other tax attributes would be substantially limited if the Company experiences an “ownership change,” as defined in Section 382 of the Internal Revenue Code (the “Code”). Generally, an “ownership change” occurs if the percentage of the Company’s stock owned by one or more “five percent stockholders” increases by more than fifty percentage points over the lowest percentage of stock owned by such stockholders at any time during the prior three-year period or, if sooner, since the last “ownership change” experienced by the Company. The Plan is intended to make it more difficult for the Company to undergo an ownership change by deterring any person from acquiring 4.9% or more of the outstanding shares of stock without the approval of the Board of Directors. The Board of Directors believes it is in the best interest of the Company and its stockholders to reduce the likelihood of an ownership change, which could harm the Company’s future operating results by effectively increasing the Company future tax liabilities.
The Rights trade with, and are inseparable from, the Common Stock, and the record holders of shares of Common Stock are the record holders of the Rights. The Rights are evidenced only by certificates (or, in the case of uncertificated shares, by notations in the book-entry account system) that represent shares of Common Stock. Rights will also be issued in respect of any shares of Common Stock that shall become outstanding after the Record Date (including upon conversion of any shares of Series A Preferred Stock of the Company) and, subject to certain exceptions specified in the Plan, prior to the earlier of the Distribution Date (as defined below) and the Expiration Date (as defined below).
The Rights are not exercisable until the Distribution Date. After the Distribution Date, each Right will be exercisable to purchase from the Company one one-thousandth of a share of Series B Junior Participating Preferred Stock, par value $0.0001 per share, of the Company (the “Series B Preferred”), at a purchase price of $18.00 per one one-thousandth of a share of Series B Preferred (the “Purchase Price”), subject to adjustment as provided in the Plan.
The “Distribution Date” is the earlier of (i) the close of business on the tenth day after the public announcement that a person or group has become an Acquiring Person (as defined below) or that discloses information which reveals the existence of an Acquiring Person or such earlier date as a majority of the Board shall become aware of the existence of an Acquiring Person (the date described in this clause (i), the “Stock Acquisition Date”) and (ii) the close of business on the tenth business day (or such later date as the Board of Directors shall determine prior to such time as any person or group becomes an Acquiring Person) after the date that a tender or exchange offer by any person is commenced, the consummation of which would result in such person becoming an Acquiring Person. A person or group becomes an “Acquiring Person” upon acquiring beneficial ownership of 4.9% or more of the outstanding shares of Common Stock, except in certain situations specified in the Plan.
The Rights will expire on the earliest of (a) the close of business on May 1, 2024, (b) the time at which the Rights are redeemed or exchanged pursuant to the Plan, or (c) the time at which the Board of Directors determines that the Tax Benefits are utilized in all material respects or that an ownership change under Section 382 of the Code would not adversely impact in any material respect the time period in which the Company could use the Tax Benefits, or materially impair the amount of the Tax Benefits that could be used by the Company in any particular time period, for applicable tax purposes (such earliest date, the “Expiration Date”).
Until a Right is exercised or exchanged, the holder thereof, as such, will have no rights as a stockholder of the Company by virtue of holding such Right, including, without limitation, the right to vote and to receive dividends.
The Board of Directors may adjust the Purchase Price, the number of shares of Series B Preferred issuable and the number of outstanding Rights to prevent dilution that may occur from a stock dividend, a stock split, a reclassification of the Series B Preferred or Common Stock or certain other specified transactions. No adjustments to the Purchase Price of less than 1% are required to be made.
In connection with the adoption of the Plan, the Board of Directors approved a Certificate of Designations of the Series B Junior Participating Preferred Stock (the “Certificate of Designations”). The Certificate of Designations was filed with the Secretary of State of the State of Delaware on May 2, 2023.
Each one one-thousandth of a share of Series B Preferred, if issued:
•Will not be redeemable.
•Will entitle holders to quarterly dividend payments of $0.001 per one one-thousandth of a share of Series B Preferred, or an amount equal to the dividend paid on one share of Common Stock, whichever is greater.
•Will entitle holders upon liquidation either to receive $0.001 per one one-thousandth of a share of Series B Preferred, or an amount equal to the payment made on one share of Common Stock, whichever is greater.
•Will have the same voting power as one share of Common Stock.
•If shares of Common Stock are exchanged as a result of a merger, consolidation, or a similar transaction, will entitle holders to a per share payment equal to the payment made on one share of Common Stock.
Accumulated Other Comprehensive Income
Comprehensive income consists of two elements, net loss and other comprehensive income (loss). Other comprehensive income (loss) items are recorded in the stockholders’ equity section of our condensed consolidated balance sheets and are excluded from net loss. Our other comprehensive income consists primarily of foreign currency translation adjustments for subsidiaries with functional currencies other than the U.S. dollar, unrealized translation losses on intercompany loans with foreign subsidiaries, and unrealized gains on interest rate swaps.
The following table shows the components of accumulated other comprehensive income (loss), net of income taxes, (“AOCI”) in the stockholders’ equity section of our condensed consolidated balance sheets at the dates indicated (in thousands):
March 31, 2024December 31, 2023
Foreign currency translation adjustment$(22,558)$(19,947)
Unrealized translation loss on intercompany loans with foreign subsidiaries, net of taxes(4,742)(3,330)
Unrealized gain on interest rate swaps15,889 14,270 
Realized gain on interest rate swap sale, net of amounts reclassified into interest expense, net13,718 15,175 
Total accumulated other comprehensive income$2,307 $6,168 
The Company has intercompany loans that were used to fund the acquisitions of foreign subsidiaries. Due to the long-term nature of the loans, the unrealized translation gains (losses) resulting from re-measurement are recognized as a component of AOCI. The unrealized translation gains (losses) on intercompany loans with foreign subsidiaries as of March 31, 2024 is net of income tax expense of $3.2 million. The tax provision (benefit) to unrealized translation gains (losses) on intercompany three months ended March 31, 2024 and March 31, 2023 was $0.1 million benefit and $0.5 million detriment, respectively. The income tax expense/benefit allocated to each component of other comprehensive income for all other periods and components is not material. The Company reclassifies taxes from AOCI to earnings as the items to which the tax effects relate are similarly reclassified.
The functional currency of our foreign subsidiaries are the local currencies. Results of operations for foreign subsidiaries are translated into United States dollars (“USD”) using the average exchange rates on a monthly basis during the year. The assets and liabilities of those subsidiaries are translated into USD using the exchange rates in effect at the balance sheet date. The related translation adjustments are recorded in a separate component of stockholders' equity in AOCI.
Stock-Based Compensation
The Company recognizes stock-based compensation expense from all awards in the following expense categories included in our condensed consolidated statements of income were as follows (in thousands):
Three Months Ended March 31,
20242023
Cost of revenue$186 $302 
Research and development606 655 
Sales and marketing397 576 
General and administrative2,333 4,929 
Total$3,522 $6,462 
Restricted Stock Units (“RSU”) and Performance-Based Restricted Stock Units (“PSU”)
Beginning in 2019, the Company began granting restricted stock units (“RSUs”) and performance-based restricted stock units (“PSUs”) under its 2014 Equity Incentive Plan, in lieu of restricted stock awards, primarily for stock plan administrative purposes.
Since 2022, fifty percent of the equity awards granted to our Chief Executive Officer were PSUs. The 2024 and 2023 PSU agreements provide that the quantity of units subject to vesting may range from 0% to 300% and 0% to 200%, respectively, of the units granted based on the Company's absolute total shareholder return (“TSR”) at the end of the 36 month performance periods.
The following table summarizes PSU and RSU activity during the three months ended March 31, 2024:
Number of UnitsWeighted-Average Grant Date Fair Value
Unvested restricted units outstanding as of December 31, 20231,858,847 $9.76 
Granted2,017,687 4.23 
Vested(467,524)8.70 
Forfeited(121,673)9.92 
Unvested restricted units outstanding as of March 31, 20243,287,337 $6.51 
The PSU and RSU activity table above includes PSU units granted that are based on a 100% target payout. Compensation expense is recognized over the required service period of the grant. The fair value of the RSUs is determined based on the grant date fair value of the award. The fair value of the PSUs is determined using the Monte Carlo simulation model and is not subject to fluctuation due to achievement of the underlying market-based target.
Significant assumptions used in the Monte Carlo simulation model for the PSUs granted during the three months ended March 31, 2024 and year ended December 31, 2023 are as follows:
March 31, 2024December 31, 2023
Expected volatility62.1%55.5%
Risk-free interest rate4.0%4.4%
Remaining performance period (in years)3.082.86
Dividend yield——
Stock Option Activity
Stock option activity during the three months ended March 31, 2024 was as follows:
Number of
Options
Outstanding		Weighted–
Average
Exercise
Price
Outstanding at December 31, 2023149,914 $11.44 
Options expired(8,215)6.22 
Outstanding at March 31, 2024141,699 $11.72 
v3.24.1.u1
Revenue Recognition
 3 Months Ended
Mar. 31, 2024
Revenue from Contract with Customer [Abstract]  
Revenue Recognition
11. Revenue Recognition
Revenue Recognition Policy
Revenue is recognized when control of the promised goods or services is transferred to the Company's customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services over the term of the agreement, generally when made available to the customers. We enter into contracts that can include various combinations of products and services, which are generally capable of being distinct and accounted for as separate performance obligations. Revenue is recognized net of sales credits and allowances. Revenue is recognized net of any taxes collected from customers, which are subsequently remitted to governmental authorities.
Revenue is recognized based on the following five step model in accordance with ASC 606, Revenue from Contracts with Customers:
•Identification of the contract with a customer
•Identification of the performance obligations in the contract
•Determination of the transaction price
•Allocation of the transaction price to the performance obligations in the contract
•Recognition of revenue when, or as, the Company satisfies a performance obligation
Performance obligations under our contracts consist of subscription and support, perpetual licenses, and professional services revenues within a single operating segment.
Subscription and Support Revenue
The Company's software solutions are available for use as hosted application arrangements under subscription fee agreements without licensing perpetual rights to the software. Subscription fees from these applications are recognized over time on a ratable basis over the customer agreement term beginning on the date the Company's solution is made available to the customer. As our customers have access to use our solutions over the term of the contract agreement we believe this method of revenue recognition provides a faithful depiction of the transfer of services provided. Our subscription contracts are generally 1 to 3 years in length. Amounts that have been invoiced are recorded in accounts receivable and deferred revenue or subscription and support revenue, depending on whether the revenue recognition criteria have been met. Additional fees for monthly usage above the levels included in the standard subscription fee are recognized as subscription and support revenue at the end of each month and are invoiced concurrently. Subscription and support revenue includes revenue related to the Company’s digital engagement application which provides short code connectivity for its two-way short message service (“SMS”) programs and campaigns. As discussed further in the “Principal vs. Agent Considerations” section below, the Company recognizes revenue related to these messaging-related subscription contracts on a gross basis.
Perpetual License Revenue
The Company also records revenue from the sales of proprietary software products under perpetual licenses. Revenue from distinct on-premises licenses is recognized upfront at the point in time when the software is made available to the customer. The majority of the Company’s products do not require significant customization.
Professional Services Revenue
Professional services provided with subscription and support licenses and perpetual licenses consist of implementation fees, data extraction, configuration, and training. The Company’s implementation and configuration services do not involve
significant customization of the software and are not considered essential to the functionality. Revenue from professional services are recognized over time as such services are performed. Revenue for fixed price services are generally recognized over time applying input methods to estimate progress to completion. Revenue for consumption-based services are generally recognized as the services are performed.
Performance Obligations and Standalone Selling Price
A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is the unit of accounting. The Company has contracts with customers that often include multiple performance obligations, usually including professional services sold with either individual or multiple subscriptions or perpetual licenses. For these contracts, the Company records individual performance obligations separately if they are distinct by allocating the contract's total transaction price to each performance obligation in an amount based on the relative standalone selling price (“SSP”), of each distinct good or service in the contract. We only include estimated amounts of variable consideration in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved.
A contract's transaction price is allocated to each distinct performance obligation and is recognized as revenue when, or as, the performance obligation is satisfied. We determine the SSP based on our overall pricing objectives, taking into consideration market conditions and other factors, including the value of our contracts, historical standalone sales, customer demographics, geographic locations, and the number and types of users within our contracts.
Principal vs. Agent Considerations
The Company evaluates whether it is the principal (i.e., report revenues on a gross basis) or agent (i.e., report revenues on a net basis) for vendor reseller agreements and messaging-related subscription agreements. Where the Company is the principal, it first obtains control of the inputs to the specific good or service and directs their use to create the combined output. The Company's control is evidenced by its involvement in the integration of the good or service on its platform before it is transferred to its customers, and is further supported by the Company being primarily responsible to its customers and having a level of discretion in establishing pricing. While none of the factors individually are considered presumptive or determinative, in reaching conclusions on gross versus net revenue recognition, the Company places the most weight on the analysis of whether or not it is the primary obligor in the arrangement.
Generally, the Company reports revenue from vendor reseller agreements on a gross basis, meaning the amounts billed to customers are recorded as revenue, and expenses incurred are recorded as cost of revenue. As the Company is primarily obligated in its messaging-related subscription contracts, has latitude in establishing prices associated with its messaging program management services, is responsible for fulfillment of the transaction, and has credit risk, we have concluded it is appropriate to record revenue on a gross basis with related pass-through telecom messaging costs incurred from third parties recorded as cost of revenue. Revenue provided from agreements in which the Company is an agent are immaterial.
Contract Balances
The timing of revenue recognition, billings and cash collections can result in billed accounts receivable, unbilled receivables, and deferred revenue. Billings scheduled to occur after the performance obligation has been satisfied and revenue recognition has occurred result in unbilled receivables, which are expected to be billed during the succeeding twelve-month period and are recorded in Unbilled receivables in our condensed consolidated balance sheets. A contract liability results when we receive prepayments or deposits from customers in advance for implementation, maintenance and other services, as well as subscription fees. Customer prepayments are generally applied against invoices issued to customers when services are performed and billed. We recognize contract liabilities as revenue upon satisfaction of the underlying performance obligations. Contract liabilities that are expected to be recognized as revenue during the succeeding twelve-month period are recorded in Deferred revenue and the remaining portion is recorded in Deferred revenue noncurrent on the accompanying condensed consolidated balance sheets at the end of each reporting period.
Deferred revenue primarily consists of amounts that have been billed to or received from customers in advance of revenue recognition and prepayments received from customers in advance for maintenance and other services, as well as initial subscription fees. We recognize deferred revenue as revenue when the services are performed, and the corresponding revenue recognition criteria are met. Customer prepayments are generally applied against invoices issued to customers when services are performed and billed. Our payment terms vary by the type and location of our customer and the products or services offered. The term between invoicing and when payment is due is not significant. For certain products or services and customer types, we require payment before the products or services are delivered to the customer.
Unbilled Receivables
Unbilled receivables represent amounts for which the Company has recognized revenue, pursuant to its revenue recognition policy, for software licenses already delivered and professional services already performed, but invoiced in arrears and for which the Company believes it has an unconditional right to payment. As of March 31, 2024 and December 31, 2023, unbilled receivables were $3.2 million and $2.7 million, respectively.
Deferred Commissions
Sales commissions earned by our sales force, and related payroll taxes, are considered incremental and recoverable costs of obtaining a contract with a customer. Deferred commissions and other costs for new customer contracts are capitalized upon contract signing and amortized on a systematic basis that is consistent with the transfer of goods and services over the expected life of the customer relationships, which has been determined to be approximately 6 years. The expected life of our customer relationships is based on historical data and management estimates, including estimated renewal terms and the useful life of the associated underlying technology. Commissions paid on renewal contracts are not commensurate with commissions paid on new customer contracts, as such, deferred commissions related to renewals are capitalized and amortized over the estimated average contractual renewal term of 18 months. We utilize the 'portfolio approach' practical expedient permitted under ASC 606-10-10-4, which allows entities to apply the guidance to a portfolio of contracts with similar characteristics as the effects on the financial statements of this approach would not differ materially from applying the guidance to individual contracts. The portion of capitalized costs expected to be amortized during the succeeding twelve-month period is recorded in current assets as deferred commissions, current, and the remainder is recorded in long-term assets as deferred commissions, net of current portion. Amortization expense is included in sales and marketing expenses in the accompanying condensed consolidated statements of operations. Deferred commissions are reviewed for impairment whenever events or circumstances indicate their carrying value may not be recoverable consistent with the Company's long-lived assets policy. No indicators of impairment were identified during the three months ended March 31, 2024.
Amortization of deferred commissions in excess of commissions capitalized for the three months ended March 31, 2024 was $0.7 million.
Deferred Revenue
Deferred revenue represents either customer advance payments or billings for which the aforementioned revenue recognition criteria have not yet been met.
Deferred revenue is mainly unearned revenue related to subscription services and support services. During the three months ended March 31, 2024, we recognized $45.5 million and $1.2 million of subscription services and professional services revenue, respectively, that was included in the deferred revenue balances at the beginning of the period.
Remaining Performance Obligations
As of March 31, 2024, approximately $258.4 million of revenue is expected to be recognized from remaining performance obligations. We expect to recognize revenue on approximately 69% of these remaining performance obligations over the next 12 months, with the balance recognized thereafter.
Disaggregated Revenue
The Company disaggregates revenue from contracts with customers by geography and revenue generating activity, as it believes it best depicts how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors.
Revenue by geography is based on the ship-to address of the customer, which is intended to approximate where the customers' users are located. The ship-to country is generally the same as the billing country. The Company has operations primarily in the United States, United Kingdom and Canada. Information about these operations is presented below (in thousands):
Three Months Ended March 31,
20242023
Revenues:
Subscription and support:
   United States$47,724 $52,242 
   United Kingdom9,075 9,675 
   Canada3,328 3,491 
   Other International6,951 7,506 
      Total subscription and support revenue67,078 72,914 
Perpetual license:
   United States691 656 
   United Kingdom98 223 
   Canada59 42 
   Other International622 650 
      Total perpetual license revenue1,470 1,571 
Professional services:
   United States1,233 1,597 
   United Kingdom271 258 
   Canada188 229 
   Other International496 487 
      Total professional service revenue2,188 2,571 
Total revenue$70,736 $77,056 
v3.24.1.u1
Related Party Transactions
 3 Months Ended
Mar. 31, 2024
Related Party Transactions [Abstract]  
Related Party Transactions
. Related Party Transactions
The Company does not have any material related party transactions to report for the three months ended March 31, 2024
v3.24.1.u1
Subsequent Events
 3 Months Ended
Mar. 31, 2024
Subsequent Events [Abstract]  
Subsequent Events
13. Subsequent Events
v3.24.1.u1
Pay vs Performance Disclosure - USD ($)
$ in Thousands
 3 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Pay vs Performance Disclosure    
Net loss $ (96,130) $ (140,045)
v3.24.1.u1
Insider Trading Arrangements
 3 Months Ended
Mar. 31, 2024
shares
Trading Arrangements, by Individual  
Non-Rule 10b5-1 Arrangement Adopted false
Rule 10b5-1 Arrangement Terminated false
Non-Rule 10b5-1 Arrangement Terminated false
Timothy Mattox [Member]  
Trading Arrangements, by Individual  
Material Terms of Trading Arrangement On February 27, 2024, Timothy Mattox, a director on the Company’s Board of Directors, adopted a written plan for the sale of up to 13,843 shares of the Company’s Common Stock that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act. The written plan will expire on December 31, 2024, or on any earlier date on which all of the shares have been sold.
Name Timothy Mattox
Title director
Rule 10b5-1 Arrangement Adopted true
Adoption Date February 27, 2024
Arrangement Duration 308 days
Aggregate Available 13,843
v3.24.1.u1
Basis of Presentation and Summary of Significant Accounting Policies (Policies)
 3 Months Ended
Mar. 31, 2024
Accounting Policies [Abstract]  
Basis of Presentation
Basis of Presentation
These condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States (“GAAP”). The condensed consolidated financial statements include the accounts of Upland Software, Inc. and its wholly owned subsidiaries (collectively referred to as “Upland”, the “Company”, “we”, “us” or “our”). All intercompany accounts and transactions have been eliminated in consolidation. No material changes have been made to the Company’s significant accounting policies disclosed in Note 2, Basis of Presentation and Summary of Significant Accounting Policies, in our Annual Report.
The accompanying unaudited interim condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim financial reporting. In the opinion of management of the Company, the unaudited interim condensed consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements, in all material respects, and include all adjustments of a normal recurring nature necessary for a fair presentation. The results of operations for the three months ended March 31, 2024 are not necessarily indicative of the results to be expected for the year ending December 31, 2024 or for any other period.
The financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s 2023 Annual Report on Form 10-K filed with the SEC on February 22, 2024.
Use of Estimates
Use of Estimates
The preparation of the accompanying condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements, and the reported amounts of revenues and expenses. Significant items subject to such estimates include those related to revenue recognition, deferred commissions, allowance for credit losses, stock-based compensation, contingent consideration, acquired intangible assets, impairment of goodwill, intangibles and long-lived assets, the useful lives of intangible assets and property and equipment, the fair value of the Company’s interest rate swaps and income taxes. In accordance with GAAP, management bases its estimates on historical experience and on various other assumptions that management believes are reasonable under the circumstances. Management regularly evaluates its estimates and assumptions using historical experience and other factors; however, actual results could differ from those estimates.
Upland is not aware of any specific event or circumstance that would require an update to its estimates or judgments or a revision of the carrying value of its assets or liabilities as of May 2, 2024, the date of issuance of this Quarterly Report on Form 10-Q. These estimates may change as new events occur and additional information is obtained. Actual results could differ materially from these estimates under different assumptions or conditions.
Concentrations of Credit Risk and Significant Customers
Concentrations of Credit Risk and Significant Customers
Financial instruments that potentially subject the Company to credit risk consist of cash and cash equivalents, accounts receivable and the Company’s interest rate swap hedges. The Company’s cash and cash equivalents are placed with high quality financial institutions, which, at times, may exceed federally insured limits. The Company has not experienced any losses in these accounts, and the Company does not believe it is exposed to any significant credit risk related to cash and cash equivalents. The Company provides credit, in the normal course of business, to a number of its customers and generally does not require collateral. To manage accounts receivable credit risk, the Company performs periodic credit evaluations of its customers and maintains current expected credit losses which considers such factors as historical loss information, geographic location of customers, current market conditions, and reasonable and supportable forecasts.
Recent Accounting Pronouncements
Recent Accounting Pronouncements
Recently issued accounting pronouncements - Not Adopted
In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which requires public entities to disclose information about their reportable segments' significant expenses and other segment items on an interim and annual basis. Public entities with a single reportable segment are required to apply the disclosure requirements in ASU 2023-07, as well as all existing segment disclosures and reconciliation requirements in ASC 280 on an interim and annual basis. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and for interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. ASU 2023-07 should be applied on a retrospective basis. The Company is currently evaluating the impact of adopting ASU 2023-07 on its disclosures.
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires public entities, on an annual basis, to provide disclosure of specific categories in the rate reconciliation, as well as disclosure of income taxes paid disaggregated by jurisdiction. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024, with early adoption permitted. ASU 2023-09 should be applied on a prospective basis, and retrospective application is permitted. The Company is currently evaluating the impact of adopting ASU 2023-09 on its disclosures.
Fair Value Measurements
The Company recognizes financial instruments in accordance with the authoritative guidance on fair value measurements and disclosures for financial assets and liabilities. This guidance defines fair value, establishes a framework for measuring fair value in accordance with GAAP, and expands disclosures about fair value measurements. The guidance also establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value.
These tiers include Level 1, defined as observable inputs, such as quoted prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs in which little or no market data exists, therefore, requiring an entity to develop its own assumptions.
The Company’s financial instruments consist principally of cash and cash equivalents, money market funds, accounts receivable, accounts payable, interest rate swap hedges, and debt. The carrying value of cash and cash equivalents, accounts receivable, and accounts payable approximate fair value, primarily due to short maturities.
Revenue Recognition Policy
Revenue Recognition Policy
Revenue is recognized when control of the promised goods or services is transferred to the Company's customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services over the term of the agreement, generally when made available to the customers. We enter into contracts that can include various combinations of products and services, which are generally capable of being distinct and accounted for as separate performance obligations. Revenue is recognized net of sales credits and allowances. Revenue is recognized net of any taxes collected from customers, which are subsequently remitted to governmental authorities.
Revenue is recognized based on the following five step model in accordance with ASC 606, Revenue from Contracts with Customers:
•Identification of the contract with a customer
•Identification of the performance obligations in the contract
•Determination of the transaction price
•Allocation of the transaction price to the performance obligations in the contract
•Recognition of revenue when, or as, the Company satisfies a performance obligation
Performance obligations under our contracts consist of subscription and support, perpetual licenses, and professional services revenues within a single operating segment.
Subscription and Support Revenue
The Company's software solutions are available for use as hosted application arrangements under subscription fee agreements without licensing perpetual rights to the software. Subscription fees from these applications are recognized over time on a ratable basis over the customer agreement term beginning on the date the Company's solution is made available to the customer. As our customers have access to use our solutions over the term of the contract agreement we believe this method of revenue recognition provides a faithful depiction of the transfer of services provided. Our subscription contracts are generally 1 to 3 years in length. Amounts that have been invoiced are recorded in accounts receivable and deferred revenue or subscription and support revenue, depending on whether the revenue recognition criteria have been met. Additional fees for monthly usage above the levels included in the standard subscription fee are recognized as subscription and support revenue at the end of each month and are invoiced concurrently. Subscription and support revenue includes revenue related to the Company’s digital engagement application which provides short code connectivity for its two-way short message service (“SMS”) programs and campaigns. As discussed further in the “Principal vs. Agent Considerations” section below, the Company recognizes revenue related to these messaging-related subscription contracts on a gross basis.
Perpetual License Revenue
The Company also records revenue from the sales of proprietary software products under perpetual licenses. Revenue from distinct on-premises licenses is recognized upfront at the point in time when the software is made available to the customer. The majority of the Company’s products do not require significant customization.
Professional Services Revenue
Professional services provided with subscription and support licenses and perpetual licenses consist of implementation fees, data extraction, configuration, and training. The Company’s implementation and configuration services do not involve
significant customization of the software and are not considered essential to the functionality. Revenue from professional services are recognized over time as such services are performed. Revenue for fixed price services are generally recognized over time applying input methods to estimate progress to completion. Revenue for consumption-based services are generally recognized as the services are performed.
Performance Obligations and Standalone Selling Price
A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is the unit of accounting. The Company has contracts with customers that often include multiple performance obligations, usually including professional services sold with either individual or multiple subscriptions or perpetual licenses. For these contracts, the Company records individual performance obligations separately if they are distinct by allocating the contract's total transaction price to each performance obligation in an amount based on the relative standalone selling price (“SSP”), of each distinct good or service in the contract. We only include estimated amounts of variable consideration in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved.
A contract's transaction price is allocated to each distinct performance obligation and is recognized as revenue when, or as, the performance obligation is satisfied. We determine the SSP based on our overall pricing objectives, taking into consideration market conditions and other factors, including the value of our contracts, historical standalone sales, customer demographics, geographic locations, and the number and types of users within our contracts.
Principal vs. Agent Considerations
The Company evaluates whether it is the principal (i.e., report revenues on a gross basis) or agent (i.e., report revenues on a net basis) for vendor reseller agreements and messaging-related subscription agreements. Where the Company is the principal, it first obtains control of the inputs to the specific good or service and directs their use to create the combined output. The Company's control is evidenced by its involvement in the integration of the good or service on its platform before it is transferred to its customers, and is further supported by the Company being primarily responsible to its customers and having a level of discretion in establishing pricing. While none of the factors individually are considered presumptive or determinative, in reaching conclusions on gross versus net revenue recognition, the Company places the most weight on the analysis of whether or not it is the primary obligor in the arrangement.
Generally, the Company reports revenue from vendor reseller agreements on a gross basis, meaning the amounts billed to customers are recorded as revenue, and expenses incurred are recorded as cost of revenue. As the Company is primarily obligated in its messaging-related subscription contracts, has latitude in establishing prices associated with its messaging program management services, is responsible for fulfillment of the transaction, and has credit risk, we have concluded it is appropriate to record revenue on a gross basis with related pass-through telecom messaging costs incurred from third parties recorded as cost of revenue. Revenue provided from agreements in which the Company is an agent are immaterial.
Contract Balances
The timing of revenue recognition, billings and cash collections can result in billed accounts receivable, unbilled receivables, and deferred revenue. Billings scheduled to occur after the performance obligation has been satisfied and revenue recognition has occurred result in unbilled receivables, which are expected to be billed during the succeeding twelve-month period and are recorded in Unbilled receivables in our condensed consolidated balance sheets. A contract liability results when we receive prepayments or deposits from customers in advance for implementation, maintenance and other services, as well as subscription fees. Customer prepayments are generally applied against invoices issued to customers when services are performed and billed. We recognize contract liabilities as revenue upon satisfaction of the underlying performance obligations. Contract liabilities that are expected to be recognized as revenue during the succeeding twelve-month period are recorded in Deferred revenue and the remaining portion is recorded in Deferred revenue noncurrent on the accompanying condensed consolidated balance sheets at the end of each reporting period.
Deferred revenue primarily consists of amounts that have been billed to or received from customers in advance of revenue recognition and prepayments received from customers in advance for maintenance and other services, as well as initial subscription fees. We recognize deferred revenue as revenue when the services are performed, and the corresponding revenue recognition criteria are met. Customer prepayments are generally applied against invoices issued to customers when services are performed and billed. Our payment terms vary by the type and location of our customer and the products or services offered. The term between invoicing and when payment is due is not significant. For certain products or services and customer types, we require payment before the products or services are delivered to the customer.
Deferred Commissions
Sales commissions earned by our sales force, and related payroll taxes, are considered incremental and recoverable costs of obtaining a contract with a customer. Deferred commissions and other costs for new customer contracts are capitalized upon contract signing and amortized on a systematic basis that is consistent with the transfer of goods and services over the expected life of the customer relationships, which has been determined to be approximately 6 years. The expected life of our customer relationships is based on historical data and management estimates, including estimated renewal terms and the useful life of the associated underlying technology. Commissions paid on renewal contracts are not commensurate with commissions paid on new customer contracts, as such, deferred commissions related to renewals are capitalized and amortized over the estimated average contractual renewal term of 18 months. We utilize the 'portfolio approach' practical expedient permitted under ASC 606-10-10-4, which allows entities to apply the guidance to a portfolio of contracts with similar characteristics as the effects on the financial statements of this approach would not differ materially from applying the guidance to individual contracts. The portion of capitalized costs expected to be amortized during the succeeding twelve-month period is recorded in current assets as deferred commissions, current, and the remainder is recorded in long-term assets as deferred commissions, net of current portion. Amortization expense is included in sales and marketing expenses in the accompanying condensed consolidated statements of operations. Deferred commissions are reviewed for impairment whenever events or circumstances indicate their carrying value may not be recoverable consistent with the Company's long-lived assets policy.
Deferred Revenue
Deferred revenue represents either customer advance payments or billings for which the aforementioned revenue recognition criteria have not yet been met.
Deferred revenue is mainly unearned revenue related to subscription services and support services.
Disaggregated Revenue
The Company disaggregates revenue from contracts with customers by geography and revenue generating activity, as it believes it best depicts how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors.
Revenue by geography is based on the ship-to address of the customer, which is intended to approximate where the customers' users are located. The ship-to country is generally the same as the billing country.
Unbilled Receivables
Unbilled Receivables
Unbilled receivables represent amounts for which the Company has recognized revenue, pursuant to its revenue recognition policy, for software licenses already delivered and professional services already performed, but invoiced in arrears and for which the Company believes it has an unconditional right to payment.
v3.24.1.u1
Fair Value Measurements (Tables)
 3 Months Ended
Mar. 31, 2024
Fair Value Disclosures [Abstract]  
Schedule of Liabilities Measured at Fair Value on a Recurring Basis
Assets measured at fair value on a recurring basis are summarized below (in thousands):
 Fair Value Measurements at March 31, 2024
(unaudited)
 Level 1Level 2Level 3Total
Assets:
Money market funds included in cash and cash equivalents$206,058 $— $— $206,058 
Interest rate swaps— 15,889 — 15,889 
Total$206,058 $15,889 $— $221,947 

 Fair Value Measurements at December 31, 2023
 Level 1Level 2Level 3Total
Assets:
Money market funds included in cash and cash equivalents$211,661 $— $— $211,661 
Interest rate swaps— 14,270 — 14,270 
Total$211,661 $14,270 $— $225,931 
v3.24.1.u1
Goodwill and Other Intangible Assets (Tables)
 3 Months Ended
Mar. 31, 2024
Goodwill and Intangible Assets Disclosure [Abstract]  
Schedule of Goodwill
Changes in the Company’s goodwill balance for the three months ended March 31, 2024 are summarized in the table below (in thousands):
Balance at December 31, 2023$353,778 
Impairment of goodwill(87,227)
Foreign currency translation adjustment(2,539)
Balance at March 31, 2024$264,012 
Schedule of Intangible Assets, Net
The following is a summary of the Company’s intangible assets, net (in thousands):
Estimated Useful
Life (Years)		Gross
Carrying Amount		Accumulated
Amortization		Net Carrying
Amount
March 31, 2024:(unaudited)
Customer relationships
1-10
$354,070 $210,034 $144,036 
Trade name
1.5-10
9,467 7,532 1,935 
Developed technology
4-9
86,948 66,107 20,841 
Favorable Leases6.3274 98 176 
Total intangible assets$450,759 $283,771 $166,988 
Estimated Useful
Life (Years)		Gross
Carrying Amount		Accumulated
Amortization		Net Carrying
Amount
December 31, 2023:
Customer relationships
1-10
$378,923 $222,436 $156,487 
Trade name
1.5-10
10,012 7,862 2,150 
Developed technology
4-9
94,103 70,582 23,521 
Favorable Leases6.3280 89 191 
Total intangible assets$483,318 $300,969 $182,349 
Schedule of Estimated Annual Amortization Expense
As of March 31, 2024, the estimated annual amortization expense for the next five years and thereafter is as follows (in thousands):
Amortization
Expense
Year ending December 31:
Remainder of 2024$40,297 
202538,796 
202636,572 
202727,680 
202817,999 
2029 and thereafter5,644 
Total$166,988 
v3.24.1.u1
Debt (Tables)
 3 Months Ended
Mar. 31, 2024
Debt Disclosure [Abstract]  
Schedule of Long-term Debt
Long-term debt consisted of the following at March 31, 2024 and December 31, 2023 (in thousands):
March 31, 2024December 31, 2023
Senior secured loans (includes unamortized discount of $4,800 and $5,376 based on an imputed interest rate of 7.6% and 7.6%, at March 31, 2024 and December 31, 2023, respectively)
$475,899 $476,674 
Less current maturities(3,257)(3,172)
Total long-term debt$472,642 $473,502 
Schedule of Debt, Interest Rate Swap The impact of the Company’s derivative financial instruments on its condensed consolidated statements of comprehensive (loss) income for the three months ended March 31, 2024 and March 31, 2023 was as follows (in thousands):
Three Months Ended March 31,
20242023
Unrealized gain (loss) recognized in Other comprehensive income (loss) on interest rate swaps1,619 $(8,154)
Amounts reclassified from Accumulated other comprehensive income (loss) to interest expense, net(1,457)— 
Total Other comprehensive income (loss) on interest rate swaps$162 $(8,154)
v3.24.1.u1
Net Loss Per Share (Tables)
 3 Months Ended
Mar. 31, 2024
Earnings Per Share [Abstract]  
Schedule of Computation of Loss Per Share
The following table sets forth the computations of loss per share (in thousands, except share and per share amounts):
Three Months Ended March 31,
20242023
Numerator:
Net Loss$(96,130)$(140,045)
Preferred stock dividends and accretion(1,375)(1,315)
Net loss attributable to common stockholders$(97,505)$(141,360)
Denominator:
Weighted–average common shares outstanding, basic and diluted28,917,897 32,259,110 
Net loss per common share, basic and diluted$(3.37)$(4.38)
Schedule of Anti–dilutive Common Share Equivalents
The following table sets forth the anti–dilutive common share equivalents as of:
 March 31,
 20242023
 
Stock options141,699 152,683 
Restricted stock units
2,937,337 2,507,689 
Performance restricted stock units350,000 193,750 
Series A Preferred Stock on an if-converted basis(1)
7,061,046 6,752,038 
Total anti–dilutive common share equivalents10,490,082 9,606,160 
(1) As of March 31, 2024, the Series A Preferred Stock plus accumulated dividends totaled $123.6 million. The Series A Preferred Stock has a conversion price of $17.50 per share, as detailed in “Note 9. Series A Convertible Preferred Stock”.
v3.24.1.u1
Stockholders' Equity (Tables)
 3 Months Ended
Mar. 31, 2024
Equity [Abstract]  
Schedule of Accumulated Other Comprehensive Income (Loss)
The following table shows the components of accumulated other comprehensive income (loss), net of income taxes, (“AOCI”) in the stockholders’ equity section of our condensed consolidated balance sheets at the dates indicated (in thousands):
March 31, 2024December 31, 2023
Foreign currency translation adjustment$(22,558)$(19,947)
Unrealized translation loss on intercompany loans with foreign subsidiaries, net of taxes(4,742)(3,330)
Unrealized gain on interest rate swaps15,889 14,270 
Realized gain on interest rate swap sale, net of amounts reclassified into interest expense, net13,718 15,175 
Total accumulated other comprehensive income$2,307 $6,168 
Schedule of Allocated Share-Based Compensation Expense
The Company recognizes stock-based compensation expense from all awards in the following expense categories included in our condensed consolidated statements of income were as follows (in thousands):
Three Months Ended March 31,
20242023
Cost of revenue$186 $302 
Research and development606 655 
Sales and marketing397 576 
General and administrative2,333 4,929 
Total$3,522 $6,462 
Schedule of PRSU Activity
The following table summarizes PSU and RSU activity during the three months ended March 31, 2024:
Number of UnitsWeighted-Average Grant Date Fair Value
Unvested restricted units outstanding as of December 31, 20231,858,847 $9.76 
Granted2,017,687 4.23 
Vested(467,524)8.70 
Forfeited(121,673)9.92 
Unvested restricted units outstanding as of March 31, 20243,287,337 $6.51 
Schedule of RSU activity
The following table summarizes PSU and RSU activity during the three months ended March 31, 2024:
Number of UnitsWeighted-Average Grant Date Fair Value
Unvested restricted units outstanding as of December 31, 20231,858,847 $9.76 
Granted2,017,687 4.23 
Vested(467,524)8.70 
Forfeited(121,673)9.92 
Unvested restricted units outstanding as of March 31, 20243,287,337 $6.51 
Schedule of Valuation Assumptions
Significant assumptions used in the Monte Carlo simulation model for the PSUs granted during the three months ended March 31, 2024 and year ended December 31, 2023 are as follows:
March 31, 2024December 31, 2023
Expected volatility62.1%55.5%
Risk-free interest rate4.0%4.4%
Remaining performance period (in years)3.082.86
Dividend yield——
Schedule of Stock Option Activity
Stock option activity during the three months ended March 31, 2024 was as follows:
Number of
Options
Outstanding		Weighted–
Average
Exercise
Price
Outstanding at December 31, 2023149,914 $11.44 
Options expired(8,215)6.22 
Outstanding at March 31, 2024141,699 $11.72 
v3.24.1.u1
Revenue Recognition (Tables)
 3 Months Ended
Mar. 31, 2024
Revenue from Contract with Customer [Abstract]  
Schedule of Disaggregation of Revenue The Company has operations primarily in the United States, United Kingdom and Canada. Information about these operations is presented below (in thousands):
Three Months Ended March 31,
20242023
Revenues:
Subscription and support:
   United States$47,724 $52,242 
   United Kingdom9,075 9,675 
   Canada3,328 3,491 
   Other International6,951 7,506 
      Total subscription and support revenue67,078 72,914 
Perpetual license:
   United States691 656 
   United Kingdom98 223 
   Canada59 42 
   Other International622 650 
      Total perpetual license revenue1,470 1,571 
Professional services:
   United States1,233 1,597 
   United Kingdom271 258 
   Canada188 229 
   Other International496 487 
      Total professional service revenue2,188 2,571 
Total revenue$70,736 $77,056 
v3.24.1.u1
Organization and Nature of Operations (Details)
Mar. 31, 2024
customer
product
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Number of cloud software products | product 25
Number of customers | customer 10,000
v3.24.1.u1
Fair Value Measurements - Schedule of Liabilities Measured at Fair Value on a Recurring Basis (Details) - Recurring Measurement Basis - USD ($)
$ in Thousands
Mar. 31, 2024
Dec. 31, 2023
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Money market funds included in cash and cash equivalents $ 206,058 $ 211,661
Assets, Fair Value Disclosure 221,947 225,931
Interest rate swap    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Interest rate swaps 15,889 14,270
Level 1    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Money market funds included in cash and cash equivalents 206,058 211,661
Assets, Fair Value Disclosure 206,058 211,661
Level 1 | Interest rate swap    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Interest rate swaps 0 0
Level 2    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Money market funds included in cash and cash equivalents 0 0
Assets, Fair Value Disclosure 15,889 14,270
Level 2 | Interest rate swap    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Interest rate swaps 15,889 14,270
Level 3    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Money market funds included in cash and cash equivalents 0 0
Assets, Fair Value Disclosure 0 0
Level 3 | Interest rate swap    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Interest rate swaps $ 0 $ 0
v3.24.1.u1
Fair Value Measurements - Narrative (Details) - USD ($)
$ in Millions
Mar. 31, 2024
Dec. 31, 2023
Level 2 | Recurring Measurement Basis    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Debt instrument, fair value $ 480.7 $ 482.1
v3.24.1.u1
Goodwill and Other Intangible Assets - Schedule of Goodwill (Details) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Goodwill [Roll Forward]    
Beginning balance $ 353,778  
Impairment of goodwill (87,227) $ (128,755)
Foreign currency translation adjustment (2,539)  
Ending balance $ 264,012  
v3.24.1.u1
Goodwill and Other Intangible Assets - Narrative (Details) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Goodwill and Intangible Assets Disclosure [Abstract]    
Non-cash loss on impairment of goodwill $ (87,227) $ (128,755)
Impairment of intangible assets (excluding goodwill) 0 0
Amortization charge of intangible assets $ 13,500 $ 18,200
v3.24.1.u1
Goodwill and Other Intangible Assets - Schedule of Intangible Assets, Net (Details) - USD ($)
$ in Thousands
Mar. 31, 2024
Dec. 31, 2023
Finite-Lived Intangible Assets [Line Items]    
Gross Carrying Amount $ 450,759 $ 483,318
Accumulated Amortization 283,771 300,969
Net Carrying Amount 166,988 182,349
Customer relationships    
Finite-Lived Intangible Assets [Line Items]    
Gross Carrying Amount 354,070 378,923
Accumulated Amortization 210,034 222,436
Net Carrying Amount $ 144,036 $ 156,487
Customer relationships | Minimum    
Finite-Lived Intangible Assets [Line Items]    
Estimated Useful Life (Years) 1 year 1 year
Customer relationships | Maximum    
Finite-Lived Intangible Assets [Line Items]    
Estimated Useful Life (Years) 10 years 10 years
Trade name    
Finite-Lived Intangible Assets [Line Items]    
Gross Carrying Amount $ 9,467 $ 10,012
Accumulated Amortization 7,532 7,862
Net Carrying Amount $ 1,935 $ 2,150
Trade name | Minimum    
Finite-Lived Intangible Assets [Line Items]    
Estimated Useful Life (Years) 1 year 6 months 1 year 6 months
Trade name | Maximum    
Finite-Lived Intangible Assets [Line Items]    
Estimated Useful Life (Years) 10 years 10 years
Developed technology    
Finite-Lived Intangible Assets [Line Items]    
Gross Carrying Amount $ 86,948 $ 94,103
Accumulated Amortization 66,107 70,582
Net Carrying Amount $ 20,841 $ 23,521
Developed technology | Minimum    
Finite-Lived Intangible Assets [Line Items]    
Estimated Useful Life (Years) 4 years 4 years
Developed technology | Maximum    
Finite-Lived Intangible Assets [Line Items]    
Estimated Useful Life (Years) 9 years 9 years
Favorable Leases    
Finite-Lived Intangible Assets [Line Items]    
Estimated Useful Life (Years) 6 years 3 months 18 days 6 years 3 months 18 days
Gross Carrying Amount $ 274 $ 280
Accumulated Amortization 98 89
Net Carrying Amount $ 176 $ 191
v3.24.1.u1
Goodwill and Other Intangible Assets - Schedule of Estimated Annual Amortization Expense (Details) - USD ($)
$ in Thousands
Mar. 31, 2024
Dec. 31, 2023
Amortization Expense    
Remainder of 2024 $ 40,297  
2025 38,796  
2026 36,572  
2027 27,680  
2028 17,999  
2029 and thereafter 5,644  
Net Carrying Amount $ 166,988 $ 182,349
v3.24.1.u1
Income Taxes (Details) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Income Tax Disclosure [Abstract]    
Benefit from income taxes $ 547 $ 1,422
v3.24.1.u1
Debt - Summary of Long-term Debt (Details) - Senior Secured Notes - USD ($)
$ in Thousands
Mar. 31, 2024
Dec. 31, 2023
Debt Instrument [Line Items]    
Long-term debt $ 475,899 $ 476,674
Less current maturities (3,257) (3,172)
Total long-term debt 472,642 473,502
Debt instrument, unamortized discount $ 4,800 $ 5,376
Debt instrument, imputed interest rate (percent) 7.60% 7.60%
v3.24.1.u1
Debt - Narrative (Details) - USD ($)
$ in Thousands
 1 Months Ended 3 Months Ended 12 Months Ended
Aug. 06, 2019
Aug. 31, 2023
Mar. 31, 2024
Mar. 31, 2023
Dec. 31, 2019
Dec. 31, 2023
Sep. 01, 2023
Line of Credit Facility [Line Items]              
Debt instrument, cash interest costs, percent     7.20% 5.40%      
Unamortized deferred financing costs     $ 4,800     $ 5,400  
Interest rate swap              
Line of Credit Facility [Line Items]              
Unrealized gain (loss) recognized in Other comprehensive income (loss) on interest rate swaps   $ 20,500 1,619 $ (8,154)      
Interest rate swap | Interest Expense              
Line of Credit Facility [Line Items]              
Other comprehensive income (loss), derivative, excluded component, increase (decrease), before adjustments, tax     $ (1,500)        
Secured Debt              
Line of Credit Facility [Line Items]              
Long-term debt, term         7 years    
Debt instrument, face amount             $ 257,900
Interest rate (percent)         5.40%   5.40%
Term Loan | Secured Debt              
Line of Credit Facility [Line Items]              
Long-term debt, term         7 years    
Interest rate (percent)     5.40%        
Floating interest rate, stated percentage     9.20%        
Credit Facility              
Line of Credit Facility [Line Items]              
Debt instrument, covenant compliance, percent     35.00%        
Debt instrument, covenant, leverage ratio, amount     $ 50,000        
Debt instrument, covenant, leverage ratio, maximum     6.00        
Debt instrument, debt default, increase in interest rate on obligations upon default     2.00%        
Credit Facility | Revolving Credit Facility              
Line of Credit Facility [Line Items]              
Long-term debt, term     5 years        
Maximum borrowing capacity     $ 60,000   $ 60,000    
Line of credit facility, unused capacity, commitment fee percentage     0.50%        
Credit Facility | Letter of Credit              
Line of Credit Facility [Line Items]              
Maximum borrowing capacity     $ 10,000        
Credit Facility | Secured Debt              
Line of Credit Facility [Line Items]              
Debt instrument, repayment rate, quarterly         0.25%    
Debt instrument, repayment rate, annual         1.00%    
Credit Facility | Secured Debt | Base Rate              
Line of Credit Facility [Line Items]              
Debt instrument, basis spread on variable rate     2.75%        
Credit Facility | Secured Debt | Eurodollar Deposits Rate              
Line of Credit Facility [Line Items]              
Debt instrument, basis spread on variable rate     3.75%        
Credit Facility | Secured Debt | Eurodollar Deposits Rate | Minimum              
Line of Credit Facility [Line Items]              
Debt instrument, basis spread on variable rate     0.00%        
Credit Facility | Secured Debt | Federal Funds Rate              
Line of Credit Facility [Line Items]              
Debt instrument, basis spread on variable rate 0.50%            
Credit Facility | Secured Debt | Federal Funds Rate | Minimum              
Line of Credit Facility [Line Items]              
Debt instrument, basis spread on variable rate     0.00%        
Credit Facility | Secured Debt | Eurodollar              
Line of Credit Facility [Line Items]              
Debt instrument, basis spread on variable rate     1.00%        
v3.24.1.u1
Debt - Summary of Debt, Interest Rate Swap (Details) - Interest rate swap - USD ($)
$ in Thousands
 1 Months Ended 3 Months Ended
Aug. 31, 2023
Mar. 31, 2024
Mar. 31, 2023
Derivative Instruments, Gain (Loss) [Line Items]      
Unrealized gain (loss) recognized in Other comprehensive income (loss) on interest rate swaps $ 20,500 $ 1,619 $ (8,154)
Amounts reclassified from Accumulated other comprehensive income (loss) to interest expense, net   (1,457) 0
Total Other comprehensive income (loss) on interest rate swaps   $ 162 $ (8,154)
v3.24.1.u1
Net Loss Per Share - Narrative (Details) - $ / shares
Mar. 31, 2024
Dec. 31, 2023
Jul. 14, 2022
Earnings Per Share [Abstract]      
Common stock, par value (in dollars per share) $ 0.0001 $ 0.0001  
Series A convertible preferred stock, par value (in dollars per share) $ 0.0001 $ 0.0001 $ 0.0001
v3.24.1.u1
Net Loss Per Share - Schedule of Computation of Loss Per Share (Details) - USD ($)
$ / shares in Units, $ in Thousands
 3 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Numerator:    
Net loss $ (96,130) $ (140,045)
Preferred stock dividends 1,375 1,315
Net loss attributable to common stockholders, basic (97,505) (141,360)
Net loss attributable to common stockholders, diluted $ (97,505) $ (141,360)
Denominator:    
Weighted-average common shares outstanding, basic (in shares) 28,917,897 32,259,110
Weighted-average common shares outstanding, diluted (in shares) 28,917,897 32,259,110
Net loss per common share, basic (in dollars per share) $ (3.37) $ (4.38)
Net loss per common share, diluted (in dollars per share) $ (3.37) $ (4.38)
v3.24.1.u1
Net Loss Per Share - Schedule of Anti–dilutive Common Share Equivalents (Details) - USD ($)
$ / shares in Units, $ in Millions
 3 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Anti–dilutive common share equivalents (in shares) 10,490,082 9,606,160
Preferred stock, conversion price (in dollars per share) $ 17.50  
Stock options    
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Anti–dilutive common share equivalents (in shares) 141,699 152,683
Restricted stock units    
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Anti–dilutive common share equivalents (in shares) 2,937,337 2,507,689
Performance restricted stock units    
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Anti–dilutive common share equivalents (in shares) 350,000 193,750
Series A Preferred Stock    
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Anti–dilutive common share equivalents (in shares) 7,061,046 6,752,038
Preferred stock accumulated dividends $ 123.6  
v3.24.1.u1
Series A Convertible Preferred Stock (Details)
$ / shares in Units, $ in Millions
 3 Months Ended
Jul. 14, 2022
USD ($)
$ / shares
shares
Mar. 31, 2024
USD ($)
director
$ / shares
shares
Dec. 31, 2023
$ / shares
Temporary Equity [Line Items]      
Number of shares issued (in shares) | shares 115,000    
Series A convertible preferred stock, par value (in dollars per share) $ 0.0001 $ 0.0001 $ 0.0001
Offering price per share (in dollars per share) $ 1,000    
Aggregate purchase price | $ $ 115.0    
Stock issuance costs | $   $ 4.6  
Temporary equity, liquidation preference (in dollars per share) $ 1,000    
Temporary equity dividend, closing date duration 7 years    
Dividends payable | $   $ 8.6  
Preferred stock, convertible, shares issuable | shares   489,617  
Preferred stock, conversion price (in dollars per share)   $ 17.50  
Temporary equity, liquidation preference | $   $ 123.6  
Temporary equity, liquidation cash purchase price   105.00%  
Temporary equity liquidation preference percentage   105.00%  
Temporary equity voting power   50.00%  
Number of board of directors to elect | director   1  
Threshold for electing one board member and not the actual ownership   5.00%  
Threshold for electing a non-voting board member requirement and not the actual ownership percentage   10.00%  
Preferred stock, conversion price (in dollars per share)   $ 17.50  
Temporary equity, number of consecutive trading days   10 days  
Before Seven Year Anniversary      
Temporary Equity [Line Items]      
Temporary equity dividend rate percentage 4.50%    
After Seven Year Anniversary      
Temporary Equity [Line Items]      
Temporary equity dividend rate percentage 7.00%    
v3.24.1.u1
Stockholders' Equity - Narrative (Details)
$ / shares in Units, $ in Thousands
 3 Months Ended 12 Months Ended 27 Months Ended
May 02, 2023
$ / shares
shares
Mar. 31, 2024
USD ($)
vote
$ / shares
shares
Mar. 31, 2023
USD ($)
Dec. 31, 2023
USD ($)
$ / shares
Mar. 31, 2024
USD ($)
vote
$ / shares
Class of Stock [Line Items]          
Common stock, par value (in dollars per share) | $ / shares   $ 0.0001   $ 0.0001 $ 0.0001
Common stock, votes per share | vote   1     1
Sales and excise tax payable   $ 200     $ 200
Stock repurchased and retired during period, value   $ 7,998      
Tax benefit preservation plan, ownership change, threshold ownership percentage 4.90%        
Preferred stock, par value (in dollars per share) | $ / shares $ 0.0001        
Performance restricted stock units          
Class of Stock [Line Items]          
Performance period         36 months
Target payout, percentage   100.00%     100.00%
Performance restricted stock units | Minimum          
Class of Stock [Line Items]          
Award vesting rights, percentage   0.00%   0.00%  
Performance restricted stock units | Maximum          
Class of Stock [Line Items]          
Award vesting rights, percentage   200.00%   300.00%  
Chief Executive Officer | Performance restricted stock units          
Class of Stock [Line Items]          
Award vesting rights, percentage         50.00%
Intercompany loans with foreign subsidiaries, accumulated tax          
Class of Stock [Line Items]          
Tax expense (benefit) recognized in OCI   $ 3,200      
Intercompany loans, accumulated tax          
Class of Stock [Line Items]          
Tax expense (benefit) recognized in OCI   $ 100 $ 500    
Preferred Stock Purchase Rights          
Class of Stock [Line Items]          
Class of warrant or right, dividends declared (in shares) | shares 1        
Class of warrant or right, outstanding (in shares) | shares 32,441,010        
Class of warrant or right, exercise price of warrants or rights (in dollars per share) | $ / shares $ 18,000        
Preferred stock purchase right, purchase share (in shares) | shares 0.001        
Preferred stock purchase right, purchase price adjustment percentage 1.00%        
Class of warrant or right, entitled dividend payment per security called by each warrant or right (in dollars per share) | $ / shares $ 0.001        
Class of warrant or right, entitled liquidation payment per security called by each warrant or right (in dollars per share) | $ / shares $ 0.001        
Class of warrant or right, entitled liquidation payment, common stock equivalent, number of shares (in shares) | shares 1        
Class of warrant or right, voting power, common stock equivalent, number of shares (in shares) | shares 1        
2023 Share Repurchase Program          
Class of Stock [Line Items]          
Stock repurchase program, authorized amount       $ 25,000  
Stock repurchases and retirements (in shares) | shares   2,242,654      
Stock repurchased and retired during period, value   $ 7,900      
Stock repurchase program, remaining authorized repurchase amount   $ 2,800     $ 2,800
v3.24.1.u1
Stockholders' Equity - Schedule of Accumulated Other Comprehensive Income (Loss) (Details) - USD ($)
$ in Thousands
Mar. 31, 2024
Dec. 31, 2023
Mar. 31, 2023
Dec. 31, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]        
Stockholders' equity attributable to parent $ 20,121 $ 126,294 $ 166,833 $ 308,870
Accumulated Other Comprehensive Income (Loss)        
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]        
Stockholders' equity attributable to parent 2,307 6,168 $ 4,206 $ 11,110
Foreign currency translation adjustment        
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]        
Stockholders' equity attributable to parent (22,558) (19,947)    
Unrealized translation loss on intercompany loans with foreign subsidiaries, net of taxes        
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]        
Stockholders' equity attributable to parent (4,742) (3,330)    
Unrealized gain on interest rate swaps        
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]        
Stockholders' equity attributable to parent 15,889 14,270    
Realized gain on interest rate swap sale, net of amounts reclassified into interest expense, net        
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]        
Stockholders' equity attributable to parent $ 13,718 $ 15,175    
v3.24.1.u1
Stockholders' Equity - Schedule of Allocated Share-Based Compensation Expense (Details) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]    
Share-based compensation expense $ 3,522 $ 6,462
Cost of revenue    
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]    
Share-based compensation expense 186 302
Research and development    
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]    
Share-based compensation expense 606 655
Sales and marketing    
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]    
Share-based compensation expense 397 576
General and administrative    
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]    
Share-based compensation expense $ 2,333 $ 4,929
v3.24.1.u1
Stockholders' Equity - Schedule of PRSU and RSU Activity (Details) - PRSU and RSU
 3 Months Ended
Mar. 31, 2024
$ / shares
shares
Number of Units  
Unvested balances at beginning of period (in shares) | shares 1,858,847
Granted (in shares) | shares 2,017,687
Vested (in shares) | shares (467,524)
Forfeited (in shares) | shares (121,673)
Unvested balances at end of period (in shares) | shares 3,287,337
Weighted-Average Grant Date Fair Value  
Unvested balances at beginning of period (in dollars per share) | $ / shares $ 9.76
Granted (in dollars per share) | $ / shares 4.23
Vested (in dollars per share) | $ / shares 8.70
Forfeited (in dollars per share) | $ / shares 9.92
Unvested balances at end of period (in dollars per share) | $ / shares $ 6.51
v3.24.1.u1
Stockholders' Equity - Schedule of Valuation Assumptions (Details) - Performance restricted stock units
 3 Months Ended 12 Months Ended
Mar. 31, 2024
Dec. 31, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Expected volatility 62.10% 55.50%
Risk-free interest rate 4.00% 4.40%
Remaining performance period (in years) 3 years 29 days 2 years 10 months 9 days
Dividend yield 0.00% 0.00%
v3.24.1.u1
Stockholders' Equity - Schedule of Stock Option Activity (Details)
 3 Months Ended
Mar. 31, 2024
$ / shares
shares
Number of Options Outstanding  
Outstanding at beginning of period (in shares) | shares 149,914
Options expired (in shares) | shares (8,215)
Outstanding at end of period (in shares) | shares 141,699
Weighted– Average Exercise Price  
Outstanding at beginning of period (in dollars per share) | $ / shares $ 11.44
Options expired (in dollars per share) | $ / shares 6.22
Outstanding at end of period (in dollars per share) | $ / shares $ 11.72
v3.24.1.u1
Revenue Recognition - Narrative (Details) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 31, 2024
Dec. 31, 2023
Revenue from External Customer [Line Items]    
Unbilled receivables $ 3,213 $ 2,701
Deferred commissions, amortization period 6 years  
Deferred commissions renewal amortization period 18 months  
Commissions capitalized in excess of amortization of deferred commissions $ 700  
Revenue expected to be recognized from performance obligations $ 258,400  
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-04-01    
Revenue from External Customer [Line Items]    
Revenue, remaining performance obligation, percentage 69.00%  
Expected satisfaction period of performance obligations, in months 12 months  
Subscription and support    
Revenue from External Customer [Line Items]    
Revenue recognized, previously in unearned revenue $ 45,500  
Professional services    
Revenue from External Customer [Line Items]    
Revenue recognized, previously in unearned revenue $ 1,200  
v3.24.1.u1
Revenue Recognition - Schedule of Disaggregation of Revenue (Details) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Disaggregation of Revenue [Line Items]    
Revenue $ 70,736 $ 77,056
Subscription and support    
Disaggregation of Revenue [Line Items]    
Revenue 67,078 72,914
Subscription and support | United States    
Disaggregation of Revenue [Line Items]    
Revenue 47,724 52,242
Subscription and support | United Kingdom    
Disaggregation of Revenue [Line Items]    
Revenue 9,075 9,675
Subscription and support | Canada    
Disaggregation of Revenue [Line Items]    
Revenue 3,328 3,491
Subscription and support | Other International    
Disaggregation of Revenue [Line Items]    
Revenue 6,951 7,506
Perpetual license    
Disaggregation of Revenue [Line Items]    
Revenue 1,470 1,571
Perpetual license | United States    
Disaggregation of Revenue [Line Items]    
Revenue 691 656
Perpetual license | United Kingdom    
Disaggregation of Revenue [Line Items]    
Revenue 98 223
Perpetual license | Canada    
Disaggregation of Revenue [Line Items]    
Revenue 59 42
Perpetual license | Other International    
Disaggregation of Revenue [Line Items]    
Revenue 622 650
Professional services    
Disaggregation of Revenue [Line Items]    
Revenue 2,188 2,571
Professional services | United States    
Disaggregation of Revenue [Line Items]    
Revenue 1,233 1,597
Professional services | United Kingdom    
Disaggregation of Revenue [Line Items]    
Revenue 271 258
Professional services | Canada    
Disaggregation of Revenue [Line Items]    
Revenue 188 229
Professional services | Other International    
Disaggregation of Revenue [Line Items]    
Revenue $ 496 $ 487