TechTarget, Inc.: Form 10-Q for the period ended Jun 30, 2025

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the unaudited condensed consolidated financial statements and accompanying notes included elsewhere in this Quarterly Report on Form 10-Q. This discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of various factors including those discussed below and elsewhere in this Quarterly Report on Form 10-Q, in our Annual Report on Form 10-K for the year ended December 31, 2024 under Part I, Item 1A, “Risk Factors,” and in the other documents we file with the SEC. Please refer to "Cautionary Note Regarding Forward-Looking Statements” on page 41 of this Quarterly Report on Form 10-Q.

Overview

Background

Informa TechTarget, together with its subsidiaries, is a leading B2B growth accelerator, informing and influencing technology buyers and sellers globally.

Following a period of expansion, the specialist technology research business of Informa TechTarget is now among the largest providers of these services. Informa TechTarget employs expert analysts to create data-driven intelligence products and advisory services for product managers, corporate strategists and the C-suite, challenging market strategies, sharpening product roadmaps and accelerating time to market and revenue.

Omdia, Industry Dive, NetLine, Canalys and Wards and Former TechTarget are important components of Informa TechTarget. These products or businesses and their portfolio of digital media brands inform, educate and influence tech buyers, creating engaged, specialist audiences and deliver first party data records. As of June 30, 2025, our business had more than 56.7 million registered members and users of our own media brands.

Targeted access to these specialist audiences is provided through a growing range of data-driven digital products and services that are designed to deliver highly qualified leads, demand generation and buyer intent to technology vendors, connecting them with the right buyers at the right time to maximize return on investment and accelerate growth.

Industry background and trends

Informa TechTarget sits at the intersection of tech and B2B marketing, each dynamic innovative markets in its own right, with what management believes are compelling structural growth drivers. This provides a strong underpin to the long-term growth ambitions of Informa TechTarget.

Technology transcends all aspects of daily life and work. Enterprise technology, incorporating software and hardware systems used by large organizations for anything from customer relationship management to networking and cyber security, is central to operating effectively and efficiently. The pace of innovation and change is rapid, creating a constant cycle of investment to enhance, upgrade and replace technology.

For Informa TechTarget, investment in innovation and growth in research and development (“R&D”) budgets provide a leading indicator of demand for its products and services. This growth in technology-related R&D is driving a new wave of investment and innovation, enhancing existing products and inspiring the next generation of products and services.

Over time, the scale of technology purchasing, particularly enterprise technology, has grown in size, resulting in B2B buying behavior becoming more complex. This complexity has led to longer sales cycles as more research is undertaken on purchasing technology products and platforms.

Typically, large technology decisions will involve a number of people across an organization from technology professionals to CIOs, CFOs and often CEOs. This research takes many forms, with an increasing amount conducted online, including by reading specialist content, reviews, information, product profiles and bespoke research, as well as through webinars and online discussions.

The majority of the B2B buyer journey is now completed before a buyer might contact the sales team of a vendor. For technology vendors, online presence and digital brand visibility are therefore critical, leading to more companies focusing spend on branded content services, thought leadership and whitepaper distribution, digital event participation and advertising on the most relevant platforms and media.

Management believes Informa TechTarget is at the center of this shift in B2B buyer behavior, delivering highly relevant content and research to technology buyers that informs, educates and influences them along the different stages of their buyer journey.

These interactions with the content — who reads what, who clicks to find out more, how long buyers spend on specific websites, etc. — and general online behavior, when captured, enriched and analyzed, provide deep insights into who potential customers are, what products and services they might be interested in, where they are in their purchasing cycle and how significant is the intent to purchase.

For B2B sales and marketing teams at technology vendors, this information is critical in targeting the right buyers at the right time, raising brand awareness and positioning products with the right audiences to secure leads that turn into sales. With increasing scrutiny and focus on return on investment, data-driven B2B marketing is becoming ever more relevant given it is typically more measurable, with more efficiency than more traditional advertising and marketing services, helping to increase lead conversion rates, reduce the cost of customer acquisition and generate more revenue per dollar of marketing spend.

Because most of Informa TechTarget’s clients are B2B technology companies, the success of Informa TechTarget is intrinsically linked to the health, and subject to the market conditions, of the technology industry. Informa TechTarget has recently been affected by macro-economic conditions, in particular the negative impact of economic uncertainty, rising inflation and interest rates on the technology industry, which has impacted investment levels and overall client marketing expenditure. Although management cannot quantify the impact of macro-economic factors on Informa TechTarget's future results, any worsening of market conditions could negatively impact its financial position and liquidity. Marketing, advertising services and sponsorship revenue is more immediately impacted by changes in client spending and current macro-economic conditions than other revenue categories.

Product and service offerings

Over the last five years, Informa TechTarget has been building a portfolio of data-driven solutions that are intended to capitalize on the positive structural market dynamic described above and meet the evolving needs of buyers and vendors in the technology market. Informa TechTarget has the potential to continue expanding upon this portfolio of capabilities.

The Informa TechTarget businesses, help both buyers of B2B technology with knowledge and intelligence, supporting them through different stages of the buyer journey, and sellers of B2B technology in identifying relevant buyers for their products, who are in-market and with the greatest purchasing intent. These digital solutions fall into a number of categories:

• Brand solutions: Brand solutions offer B2B marketers the opportunity to grow brand awareness through direct exposure to specialist technology and business audiences across the businesses’ portfolio of 14 online products and off-network through audience extension programs. Solutions include digital display banners, newsletter sponsorships and email marketing, enabling technology vendors to gain exposure and benefit from association with the businesses’ specialist brands and high quality editorial content amongst our readership base of engaged technology buyers. Brand solutions include the Industry Dive portfolio of more than 35 specialist brands, which deliver high quality business journalism to niche audiences, offering outbound email sponsorship opportunities to vendors looking to build awareness and reach key decision makers.
• Demand solutions: These businesses enable marketers to directly engage prospective buyers through a portfolio of content marketing programs, including webinars, whitepapers, playbooks, virtual events and surveys. Through syndicating these across owned media properties and to NetLine’s publisher network, marketers can influence B2B tech buyers and generate demand for their products and services. The businesses are focused on delivering high-quality leads to marketers by gating their content across properties to maximize return on investment. The BrightTALK platform and audience outreach offerings allow our customers to create, host and promote webinars, virtual events and video content. Customers create their own hosted Channels on the platform where they schedule both live and on-demand webinars for promotion to BrightTALK’s community of in-market accounts and prospects. The BrightTALK Channel also enables customers to self-administer lead generation campaigns, set up workflow integrations between the Channel and their customer relationship management (“CRM”) and marketing automation platforms (“MAP”) systems, and access reporting detailing the size and growth of their community of subscribers over time. Customers may also create an off-network embedded Channel page on their own corporate

website featuring content in their BrightTALK Channel, as well as an embedded BrightTALK registration form that captures and converts interested individuals to marketing leads.

• Custom content services: Through StudioID, BrightTALK Studio, and Enterprise Strategy Group custom content offerings, we support marketers with their end-to-end content strategy by offering proprietary audience research to inform campaigns, strategic design and development, and original content production. Marketers leverage our award-winning deep industry expertise to create journalistic or analyst-sourced content across 40 different formats and multiple languages, which can then be distributed across our network. We also offer content licensing through Marketplace, whereby marketers curate relevant content from a selection of publishers and then distribute the content on their own channels to align themselves with top voices in their industries.
• Intelligence subscription services: Operating through the Omdia brand, as well as niche brands Canalys and Wards Intelligence, the specialist tech research business is primarily an “intelligence” subscription service, providing clients with a core “data backbone” in addition to qualitative analyst-produced content across the technology industry spectrum. The data is typically comprised of market trackers, market sizing, market share analyses and forecasts, and is complemented by expert industry reports, analyst opinions and an “Ask an Analyst” service. Covering more than 3,000 topics and tracking over 12,000 companies, the businesses’ 300+ expert analysts and consultants provide quantitative and qualitative insights that help companies make better decisions, faster.
• Advisory: In the consulting business, the businesses work as an extension of client teams, working together to provide strategic support in assessing critical business challenges and providing bespoke solutions. The businesses leverage the breadth and depth of their analyst expertise to evaluate clients’ end-to-end business needs across go-to-market, competitive positioning, new product ideation, market entry.
• IT Deal Alert: IT Deal Alert is a suite of data, software and services designed for B2B technology companies that leverages detailed purchase intent data we collect from enterprise technology organizations and professionals browsing and purchasing IT products on our network of websites and engaging with our webinar community platform. Through our proprietary data-capture and scoring methodologies, we help our customers identify and prioritize accounts and contacts whose content consumption and online research activities around specific enterprise technology topics indicate that they are “in-market” for a particular B2B technology product or service. The suite of products and services includes Priority Engine™ and Qualified Sales Opportunities™. Priority Engine™ is a subscription service powered by our Activity Intelligence™ platform that integrates with CRM and MAPs—Salesforce.com, Marketo, Hubspot, Eloqua, Pardot, and Integrate —to deliver lead generation workflow solutions. These workflows enable marketers and sales forces to identify, prioritize, and engage accounts and individuals actively researching new technology purchases or upgrades. Qualified Sales Opportunities™ is a product that profiles active purchase projects through surveys and interviews with business technology professionals whose online behavior suggests an upcoming technology purchase, providing insights into project scope, purchase criteria and vendors under consideration.

Critical Accounting Policies and Use of Estimates

Preparation of the accompanying unaudited condensed consolidated financial statements requires management to make judgments, assumptions and estimates regarding uncertainties that could affect reported revenue, expenses, assets, liabilities and equity. The most significant areas where management’s judgments, assumptions and estimates impact the unaudited condensed consolidated financial statements are described below. Actual results in these areas could differ materially from management’s estimates under different assumptions and conditions. Significant accounting policies are described fully in Note 2. Significant Accounting Policies to the unaudited condensed consolidated financial statements included under Item 8. “Financial Statements and Supplementary Data” of our Annual Report on Form 10-K for the year ended December 31, 2024.

Basis of presentation and corporate expense allocations

The accompanying unaudited condensed consolidated financial statements and related notes represent the business referred to as the Informa Tech Digital Business for the periods preceding the date of the Transactions and include the performance of Former TechTarget from the date of the closing of the Merger. The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with U.S. GAAP for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all normal, recurring adjustments have been included such that the unaudited condensed consolidated financial statements are fairly stated. The results of operations for the periods presented are not necessarily indicative of results to be expected for any other interim periods or for the full year. Prior to the Transaction, the Informa Tech Digital Business previously were operated as part of the Informa Tech division of Informa and not as a standalone entity and had no separate legal status or existence. As such, the financial position and results of operations, for the periods prior to the Transaction, have been derived from Informa’s historical accounting records and are presented on a carve-out basis. Intercompany transactions, profits and balances among the Informa Tech Digital Business’ entities have been eliminated. Sale and purchase transactions between Informa TechTarget and other Informa affiliates are included in the condensed consolidated financial statements.

Accordingly, the accompanying unaudited condensed consolidated financial statements reflect some charges for costs directly related to Informa TechTarget. Informa TechTarget has been allocated a portion of costs incurred by Informa for certain central functions and other operations that are used by Informa TechTarget, including but not limited to executive oversight, finance, treasury, tax, legal, human resources, technology, marketing and other shared services. All such costs are reflected in the accompanying unaudited condensed consolidated financial statements. These costs were allocated using a methodology that Management believes is reasonable for the item being allocated. Allocation methodologies include Informa TechTarget’s relative share of revenues, headcount, usage, or functional spend as a percentage of the total. While management believes the methodologies and assumptions used to allocate these costs are reasonable, the unaudited condensed consolidated financial statements do not purport to represent the financial position, results of operations, changes in equity, and cash flows of Informa TechTarget in the future, or what such costs would have been had Informa TechTarget operated as a stand-alone entity during the periods presented.

Revenue recognition

Revenue is recognized as Informa TechTarget satisfies a performance obligation, based upon transfer of control of promised products or services to clients in an amount that reflects the consideration to which Informa TechTarget expects to be entitled in exchange for those products or services. Some of Informa TechTarget’s performance obligations are satisfied over time as the product or service is transferred to the client. Performance obligations which are not satisfied over time are satisfied at a point in time.

Informa TechTarget enters into contracts that can include various combinations of its offerings which are generally capable of being distinct and accounted for as separate performance obligations.

When performance obligations are combined into a single contract, Informa TechTarget utilizes the relative stand-alone selling price of each product or service to allocate the transaction price among the performance obligations, which is generally determined based on the prices charged to the clients when sold on a stand alone basis or using expected cost plus a margin, with any discounts allocated across the performance obligations. Revenue for each category type of revenue is typically fixed at the date of the order and is not variable.

Revenue from fixed fee engagements is recognized over time as Informa TechTarget works to satisfy its performance obligations as Informa TechTarget generally has an enforceable right to payment for performance completed to date.

Goodwill, long-lived assets and impairment

As of June 30, 2025 and December 31, 2024, goodwill was $135.0 million and $973.4 million, respectively. Informa TechTarget's goodwill represents the excess purchase price of an acquired entity over the amounts assigned to assets and liabilities assumed in a business combination. Informa TechTarget performs an assessment of goodwill for impairment annually as of December 31 or whenever events or changes in circumstances indicate there may be an impairment.

The Company may assess goodwill for impairment initially using a qualitative approach to determine whether conditions exist that indicate it is more likely than not that the fair value of a reporting unit is less than its carrying value. Among the factors that could trigger an impairment review are a reporting unit’s operating results declining relative to its operating plan or historical performance, competitive pressures, changes in the general markets in which it operates, and a sustained decline in share price. If the Company concludes, based on its assessment of relevant events, facts, and circumstances that it is more likely than not that a reporting unit’s carrying value is greater than its fair value, then a quantitative analysis will be performed to determine if there is any impairment. Alternatively, the Company may elect to initially perform a quantitative analysis instead of starting with a qualitative analysis. These assessments require the Company to make judgments, assumptions, and estimates about projected cash flows, discount rates and other factors. The non-cash goodwill impairment loss is the difference between the reporting unit's fair value and carrying value, not to exceed the carrying amount of the goodwill.

As of June 30, 2025, the Company had five reporting units: Legacy TechTarget, Bluefin, NetLine, Industry Dive, and Canalys. The Company identified a sustained decline in share price during each of the first and second quarters of 2025 that, along with other qualitative considerations including the continued impact from the conditions in the macroeconomic environment, constituted an impairment triggering event for all reporting units. For the three months and six months ended June 30, 2025, Informa TechTarget performed the required impairment tests of goodwill on its reporting units using a discounted cash flow model with the following key assumptions in the fair value calculations:

• Projected cash flows: For each of the first and second quarter of 2025, the Company used a two-stage valuation approach to projected cash flows, which included key assumptions of forecasted revenue growth rate and EBITDA

margin followed by a steady state period of long-term growth. Forecasts for the first stage include management expectations of Informa TechTarget's financial performance with key assumptions of forecasted revenue growth rate and EBITDA margin and represent the best estimate of the future performance of the relevant reporting units, followed by a steady state period of long-term growth. Forecasts for the second stage are based on determining the Company’s terminal value, which is the value of the business beyond the discrete forecast period and utilizes a two‑stage growth model with an initial high‑growth rate stage, followed by a perpetual normalized growth stage.

• Discount rate: For each of the first and second quarter of 2025, a post-tax discount rate using a weighted average cost of capital methodology. For the cost of debt, Informa TechTarget considered market rates, based on entities with a comparable credit rating. The cost of equity is calculated using the Capital Asset Pricing Model methodology. The discount rates include appropriate risk premiums to reflect additional risks of the specific reporting units being tested.
• Long-term growth rate: For each of the first and second quarter of 2025, long-term growth rates are based on external factors such as long-term Consumer Price Index rates and external market reports for the main geographic markets in which each reporting unit operates and therefore are not considered to exceed the long-term average growth prospects for the individual markets. Long-term growth rates have not been risk adjusted to reflect any of the specific reporting unit uncertainties noted above, as these uncertainties are already reflected in the discount rates used.
• Tax rate: For each of the first and second quarter of 2025, the tax rate is based on external reports of the weighted-average corporate tax rates for the main geographic markets in which each reporting unit operates.
• Net working capital rate: For each of the first and second quarter of 2025, the net working capital rate is based on the market participant level of cash free net working capital, and a comparison of guideline public companies.
• Capital expenditures rate: For each of the first and second quarter of 2025, the capital expenditures rate is based on the Company’s historical depreciation expense.

There is a significant degree of uncertainty associated with these key assumptions. Projected cash flows, including key assumptions of forecasted revenue growth rates and EBITDA margin, are contingent on the Company’s ability to accurately forecast future financial performance, which is subject to factors beyond the Company’s control such as changes in market conditions, economic downturns, and competitive pressures. The discount rate also incorporates market-based rates and risk premiums that are subject to fluctuations due to shifts in macroeconomic factors, investor sentiment, and changes in the Company's perceived risk profile. Moreover, the long-term growth rate assumption, although derived from reputable external sources, can be influenced by unforeseeable changes in industry dynamics, regulatory environments, and technological advancements that may impact growth trajectories. Consequently, while these assumptions are grounded in established financial theories and best estimates, there is an inherent degree of uncertainty.

Canalys

Based on the quantitative fair value testing, a goodwill impairment of $15.5 million and $35.2 million was recognized during the three and six months ended June 30, 2025, respectively. The carrying value of goodwill in the Canalys reporting unit as of June 30, 2025 was $17.0 million post impairment. For the three months ended June 30, 2025, a 10% decrease in the weighted average forecasted revenue growth rate used for the goodwill assessment over this reporting unit as of June 30, 2025 would have increased the goodwill impairment recognized by $15.0 million. For the three months ended June 30, 2025, a 7.3% increase in the weighted average forecasted revenue growth rate would have resulted in no impairment in the period. For the three months ended June 30, 2025, an 8.6% decrease in the weighted average EBITDA margin used for the goodwill assessment over this reporting unit as of June 30, 2025 would have resulted in all goodwill being impaired. For the three months ended June 30, 2025, a 7.4% increase in the weighted average EBITDA margin would have resulted in no impairment in the period. For the three months ended June 30, 2025, a 100 basis-point change in the discount rate used for the goodwill assessment over this reporting unit as of June 30, 2025 would have increased or decreased the goodwill impairment recognized by $3.0 million and $4.0 million, respectively. For the three months ended June 30, 2025, a 100 basis-point change in the long-term growth rate used for the goodwill assessment over this reporting unit as of June 30, 2025 would have increased or decreased the goodwill impairment recognized by $2.0 million and $3.0 million, respectively. These sensitivities are hypothetical and should be used with caution as they do not include interplay among assumptions.

NetLine

Based on the quantitative fair value testing, a goodwill impairment of $14.3 million was recognized during the three months ended June 30, 2025. The carrying value of goodwill in the NetLine reporting unit as of June 30, 2025 was $27.2 million post impairment. For the three months ended June 30, 2025, a 10% decrease in the weighted average forecasted revenue growth rate used for the goodwill assessment over this reporting unit as of June 30, 2025 would have increased the goodwill impairment recognized by $24.0 million. For the three months ended June 30, 2025, a 5.6% increase in the weighted average forecasted revenue growth rate would have resulted in no impairment in the period. For the three months ended June 30, 2025, a 9.9% decrease in the weighted average EBITDA margin used for the goodwill assessment over this reporting unit as of June 30, 2025 would have resulted in all goodwill being impaired. For the three months ended June 30, 2025, a 7.1% increase in the weighted average EBITDA margin would have resulted in no impairment in the period. For the three months ended June 30, 2025, a 100 basis-point change in the discount rate used for the goodwill assessment over this reporting unit as of June 30, 2025 would have increased or decreased the goodwill impairment recognized by $5.0 million and $6.0 million, respectively. For the three months ended June 30, 2025, a 100 basis-point change in the long-term growth rate used for the goodwill assessment over this reporting unit as of June 30, 2025 would have increased or decreased the goodwill impairment recognized by $4.0 million and $4.0 million, respectively. These sensitivities are hypothetical and should be used with caution as they do not include interplay among assumptions.

Legacy TechTarget

Based on the quantitative fair value testing, a goodwill impairment of $248.2 million and $436.7 million was recognized during the three and six months ended June 30, 2025, respectively. There was no carrying value of goodwill in the Legacy TechTarget reporting unit as of June 30, 2025 post impairment. For the three months ended June 30, 2025, a 10% increase in the weighted average forecasted revenue growth rate used for the goodwill assessment over this reporting unit as of June 30, 2025 would have decreased the goodwill impairment recognized by $177.8 million. For the three months ended June 30, 2025, a 10% increase in the weighted average EBITDA margin used for the goodwill assessment over this reporting unit as of June 30, 2025 would have decreased the goodwill impairment recognized by $158.0 million. For the three months ended June 30, 2025, a 100 basis-point decrease in the discount rate used for the goodwill assessment over this reporting unit as of June 30, 2025 would have decreased the goodwill impairment recognized by $37.0 million. For the three months ended June 30, 2025, a 100 basis-point increase in the long-term growth rate used for the goodwill assessment over this reporting unit as of June 30, 2025 would have decreased the goodwill impairment recognized by $25.0 million. These sensitivities are hypothetical and should be used with caution as they do not include interplay among assumptions.

Bluefin

Based on the quantitative fair value testing, a goodwill impairment of $16.3 million and $139.8 million was recognized during the three and six months ended June 30, 2025, respectively. The carrying value of goodwill in the Bluefin reporting unit as of June 30, 2025 was $37.0 million post impairment. For the three months ended June 30, 2025, a 2.3% increase in the weighted average forecasted revenue growth rate would have resulted in no impairment in the period. For the three months ended June 30, 2025, a 6.8% decrease in the weighted average forecasted revenue growth rate used for the goodwill assessment over this reporting unit as of June 30, 2025 would have resulted in all goodwill being impaired. For the three months ended June 30, 2025, a 1.3% increase in the weighted average EBITDA margin would have resulted in no impairment in the period. For the three months ended June 30, 2025, a 3.4% decrease in the weighted average EBITDA margin used for the goodwill assessment over this reporting unit as of June 30, 2025 would have resulted in all goodwill being impaired. For the three months ended June 30, 2025, a 100 basis-point change in the discount rate used for the goodwill assessment over this reporting unit as of June 30, 2025 would have increased or decreased the goodwill impairment recognized by $11.0 million and $14.0 million, respectively. For the three months ended June 30, 2025, a 100 basis-point change in the long-term growth rate used for the goodwill assessment over this reporting unit as of June 30, 2025 would have increased or decreased the goodwill impairment recognized by $7.0 million and $9.0 million, respectively. These sensitivities are hypothetical and should be used with caution as they do not include interplay among assumptions.

Industry Dive

Based on the quantitative fair value testing, a goodwill impairment of $87.9 million and $215.3 million was recognized during the three and six months ended June 30, 2025, respectively. The carrying value of goodwill in the Industry Dive reporting unit as of June 30, 2025 was $53.8 million post impairment. For the three months ended June 30, 2025, a 10% decrease in the weighted average forecasted revenue growth rate used for the goodwill assessment over this reporting unit as of June 30, 2025 would have increased the goodwill impairment recognized by $42.0 million. For the three months ended June 30, 2025, a 10% increase in the weighted average forecasted revenue growth rate used for the goodwill assessment over this reporting unit as of June 30, 2025 would have decreased the goodwill impairment recognized by $61.0 million. For the three months ended June 30, 2025, a 5.9% decrease in the weighted average EBITDA margin used for the goodwill assessment over this reporting unit as of June 30, 2025 would have resulted in all goodwill being impaired. For the three months ended June 30, 2025, a 9.3% increase in the weighted average EBITDA margin would have resulted in no impairment in the period. For the three months ended June 30, 2025, a 100 basis-point change in the discount rate used for the goodwill assessment over this reporting unit as of June 30, 2025 would have increased or decreased the goodwill impairment recognized by $9.0 million and $11.0 million, respectively. For the three months ended June 30, 2025, a 100 basis-point change in the long-term growth rate used for the goodwill assessment over this reporting unit as of June 30, 2025 would have increased or decreased the goodwill impairment recognized by $6.0 million and $8.0 million, respectively. These sensitivities are hypothetical and should be used with caution as they do not include interplay among assumptions.

Business Combinations

Informa TechTarget applies the purchase method of accounting to business combinations. All of the assets acquired, liabilities assumed, and contingent consideration is recorded based on their estimated fair values. Goodwill as of the acquisition date is measured as the excess of consideration transferred over the acquisition date fair values of the net tangible and identifiable intangible assets acquired and liabilities assumed.

The determination of the fair value of identifiable intangible assets involves significant assumptions and estimates, including, but not limited to projected revenue growth rates and EBITDA margins, future customer attrition, discount rates, royalty rates, technology obsolescence factors, useful economic lives and expected future cash flows. Although management believes the assumptions and estimates for historical acquisitions to be reasonable and appropriate, they require judgment and are based on experience and historical information from all of the acquired entities. A change in these estimates could cause a materially different value of intangible assets to be recognized with an opposing impact on the goodwill arising from the transaction.

At the acquisition date of a business combination and at each subsequent balance sheet date, consideration contingent on future performance over the contractual earn-out period are remeasured to fair value. Informa TechTarget utilizes significant estimates and assumptions in determining the estimated contingent consideration and associated expense or gain at each balance sheet date. The liabilities are measured against the contractually agreed performance targets at each subsequent reporting date with any adjustments recognized in the unaudited condensed consolidated income statement. The estimation of these liabilities requires the Company to make judgements concerning the future performance of related businesses over the contingent consideration period. The estimation uncertainty risk of payments greater than one year is higher due to the forecast nature of the inputs.

Components of Results of Operations

Revenues

Revenue is disaggregated into four categories: Marketing, advertising services and sponsorship; Intelligence subscription services; Advisory services; and Exhibitor and attendee revenue.

These products and services are delivered under both short-term contracts that run for the length of a given marketing/sales program, typically less than nine months, and through integrated contracts exceeding 270 days (“longer-term contracts”) covering various client needs. Longer-term contracts include a range of annual subscription products, which are paid for in advance. In the three and six months ended June 30, 2025, approximately 33% and 35% of our revenues were from longer-term contracts, respectively. In the three and six months ended June 30, 2024, approximately 35% and 38% of our revenues were from longer-term contracts, respectively

Cost of revenues

Cost of revenues primarily consists of salaries and related personnel costs for research, editorial and consulting employees, lead generation expenses, freelance contractors expenses, website hosting costs, internal use software and developed technology amortization and other related overheads.

Selling and marketing

Selling and marketing expenses consist primarily of salaries and related personnel costs, sales commissions, facility expenses, advertising costs, and other related overheads.

General and administrative

General and administrative expenses consist primarily of salaries and related personnel costs, facility expenses and related overheads, accounting, legal and other professional fees, bad debt provision, and stock-based compensation expenses.

Product development

Product development includes the creation of Informa TechTarget's network of websites and data analytics framework, advertiser offerings and technical infrastructure that do not meet the criteria for capitalization.

Acquisition and integration costs

Acquisition-related costs that are not part of purchase consideration are expensed as incurred. These costs typically include finder’s fees, legal, accounting, and other professional costs. Integration-related costs represent costs that relate directly to combining Informa TechTarget and its acquired businesses and are expensed as incurred. Integration-related costs typically include strategic consulting services, employee-related costs, such as retention and severance, costs to integrate information technology infrastructure, enterprise planning systems, processes, and other non-recurring integration-related costs.

Depreciation

Depreciation expense consists of the depreciation of property and equipment. Depreciation is calculated using the straight-line method over their estimated useful lives, ranging from three to five years.

Amortization

Amortization expense consists of the amortization of intangible assets. Intangible assets are amortized by using methods that are expected to reflect the estimated pattern of economic use or a straight-line basis over the estimated useful lives of the underlying assets.

Impairment of long-lived assets and goodwill

Impairment of long-lived assets and goodwill primarily relates to lease impairment and goodwill impairment in each of the Company’s reporting units.

Remeasurement of contingent consideration

Remeasurement of contingent consideration relates to the fair value adjustment of acquisition related contingent consideration. Any remaining contingent consideration as of the Transaction was assumed by Parent.

Interest income

Interest income is primarily from related-party loans, by reference to the principal outstanding and at the effective interest rate applicable, and also from cash and cash equivalents. All related party loans were settled as of the close of the Transaction.

Related party interest expense

Related party interest expense consists of interest on related-party loans at the effective interest rate applicable and the unsecured five-year revolving Credit Facility. The interest rate on the unsecured revolving Credit Facility is variable.

Other income (expense), net

Other income (expense), net consists primarily of unrealized/realized foreign currency transaction gains and losses. This includes the remeasurement of the convertible notes utilizing the fair value option.

Income tax benefit (expense)

Income tax benefit (expense) reflects income earned and taxed, in jurisdictions in which Informa TechTarget conducts business, which mainly include the United Kingdom and United States federal and state income taxes.

Results of Operations

The following table sets forth a summary of certain key financial information for the three and six months ended June 30, 2025 and 2024:

Informa TechTarget restated its financial statements as of and for the three and six months ended June 30, 2024. The amounts in the “As Restated” columns are the updated amounts including the impacts of the errors identified. The restatement is described fully in Note 1. Business Overview and Basis of Presentation to the unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q.

Comparison of The Three Months Ended June 30, 2025 and 2024

Revenues

Revenue for the three months ended June 30, 2025 was $119.9 million, an increase of $57.0 million, or 90%, compared to the three months ended June 30, 2024. The acquisition of Former TechTarget in December 2024 provided $44.1 million in marketing, advertising services, and sponsorship revenues, and $4.2 million in advisory services revenue to the three months ended June 30, 2025. Marketing, advertising services, and sponsorship revenues increased $4.2 million due to higher demand from returning customers compared to the prior year period.

Cost of Revenues

Cost of revenues for the three months ended June 30, 2025 was $51.2 million, an increase of $24.5 million, or 92%, compared to the three months ended June 30, 2024. The increase is largely driven by the acquisition of Former TechTarget in December 2024, which contributed $20.9 million in labor and contracted costs in 2025. The remaining $3.6 million increase was primarily driven by increased labor and related costs due to our heightened focus on delivering our services to our customers as part of our integration.

Operating Expenses and Other

Selling and Marketing. Selling and marketing costs increased by $23.0 million, or 163%, for the three months ended June 30, 2025 compared to the three months ended June 30, 2024, primarily due to the acquisition of Former TechTarget in December 2024 which contributed $21.3 million in labor and related costs in 2025. The remaining $1.7 million increase was primarily driven by increased labor and related costs due to our heightened focus on selling and marketing our services to our customers as part of our integration.

General and Administrative. General and administrative costs increased by $1.5 million, or 9%, for the three months ended June 30, 2025 compared to the three months ended June 30, 2024, primarily due to the acquisition of Former TechTarget in December 2024 which contributed $11.0 million in 2025. This was offset by a $9.5 million reduction in costs due to a decrease in focus (primarily labor and related costs) on general and administrative and an increase in focus on cost of revenues.

Product Development. Product development costs decreased by $0.3 million, or (11%) for the three months ended June 30, 2025 compared to the three months ended June 30, 2024, primarily due to a decrease of $1.9 million due to product offering rationalization. This was offset by the acquisition of Former TechTarget in December 2024 which contributed $1.6 million in labor and related costs in 2025.

Depreciation. Depreciation expense increased $0.1 million, or 38% for the three months ended June 30, 2025 compared to the three months ended June 30, 2024, due to the acquisition of Former TechTarget in December 2024.

Amortization. Amortization expense increased $11.7 million, or 105% for the three months ended June 30, 2025 compared to the three months ended June 30, 2024, primarily due to the acquisition of Former TechTarget in December 2024.

Impairment of Goodwill. As a result of the impairment analysis in the three months ended June 30, 2025, an impairment charge of $382.2 million was recorded relating to the Canalys, Industry Dive, NetLine, Bluefin Legacy and legacy TechTarget reporting units. Due to the continued decrease in our stock price and overall market capitalization, along with other qualitative considerations including the continued impact from the conditions in the macroeconomic environment, it was determined a triggering event occurred, indicating goodwill may be impaired. Accordingly, we conducted a quantitative impairment test of our goodwill at June 30, 2025. We estimate the implied fair value of our goodwill primarily using an income approach. Changes in the estimates or assumptions used in our quantitative impairment test could materially affect the determination of fair value and the associated goodwill impairment assessment. Potential events and circumstances that could have an adverse impact on our estimates and assumptions include, but are not limited to continued increases in costs and other macroeconomic factors.

Impairment of Long-Lived Assets. We did not have any impairment of long-lived assets in the three months ended June 30, 2025. Impairment of long-lived assets in the three months ended June 30, 2024 was $0.2 million due to the exit from Industry Dive’s Washington, D.C. office in March 2024.

Acquisition and Integration Costs. Acquisition and integration expense decreased $7.7 million, or (34%), for the three months ended June 30, 2025 compared to the three months ended June 30, 2024, primarily due to a $22.5 million reduction in acquisition costs from the prior period, partially offset by a $9.1 million increase in expenses for employee related costs and professional service fees as part of the integration in 2025. The acquisition of Former TechTarget in December 2024, also contributed an additional $5.7 million in integration costs.

Remeasurement of Contingent Consideration. In the three months ended June 30, 2025, there was no contingent consideration remeasurement. Contingent consideration remeasurement in the three months ended June 30, 2024 was a loss of $2.1 million due to a revision to forecasts to reflect challenging macro-economic conditions, which impacted demand for core email and website sponsorship/advertising products, as technology companies cut back on investment.

Interest expense on related party loans. Interest expense on related party loans decreased $3.4 million, or (55%), in the three months ended June 30, 2025 compared to the three months ended June 30, 2024. This significant reduction resulted from the August 2024 settlement of a related party loan originally established to finance the Industry Dive acquisition in fiscal 2022. The loan settlement eliminated associated interest obligations, substantially reducing financing costs in the current reporting period and reflecting improved capital structure following debt resolution. The acquisition of Former TechTarget in December 2024 did not have a material impact on the balance.

Interest Income. Interest income decreased $1.2 million, or (95%), for the three months ended June 30, 2025 compared to the three months ended June 30, 2024, due to decreased cash balances in the current period.

Other Income (expense). Other expense increased by $5.4 million, or 3,536%, for the three months ended June 30, 2025 compared to the three months ended June 30, 2024. The increase was largely driven by the acquisition of Former TechTarget in December 2024, which contributed $3.6 million of expense in 2025. The remaining $1.8 million increase in expense was primarily driven by the impact of foreign currency transaction losses.

Income Tax Benefit (Expense). Income tax benefit for the three months ended June 30, 2025 was $19.6 million, an increase of $20.6 million compared to the income tax expense of $1.0 million in the three months ended June 30, 2024. The effective tax rate was 4.7% and 2.5% for the three months ended June 30, 2025 and 2024, respectively. In 2025, the effective tax rate was primarily driven by a non-deductible goodwill impairment, which was not treated as a discrete item due to our history of impairments, and geographic mix of earnings. In 2024, the effective tax rate was primarily driven by non-taxable contingent consideration and non-deductible goodwill impairment.

Comparison of The Six Months Ended June 30, 2025 and 2024

Revenues

Revenue for the six months ended June 30, 2025 was $223.8 million, an increase of $102.2 million, or 84%, compared to the six months ended June 30, 2024. The acquisition of Former TechTarget in December 2024 provided $82.5 million in marketing, advertising services, and sponsorship revenues, and $8.7 million in advisory services revenue to the six months ended June 30, 2025. Marketing, advertising services, and sponsorship revenues also increased $7.7 million due to higher demand from returning customers compared to the prior year period.

Cost of Revenues

Cost of revenues for the six months ended June 30, 2025 was $95.3 million, an increase of $44.7 million, or 88%, compared to the six months ended June 30, 2024. The increase is largely driven by the acquisition of Former TechTarget in December 2024, which contributed $37.1 million in labor and contracted costs in 2025. The remaining $7.6 million increase was primarily driven by increased labor and related costs due to our heightened focus on delivering our services to our customers as part of our integration.

Operating Expenses and Other

Selling and Marketing. Selling and marketing costs increased by $42.5 million, or 152%, for the six months ended June 30, 2025 compared to the six months ended June 30, 2024, primarily due to the acquisition of Former TechTarget in December 2024 which contributed $36.8 million in labor and related costs in 2025. The remaining $5.7 million increase was primarily driven by our increased labor and related costs due to our heightened focus on selling and marketing our services to our customers as part of our integration.

General and Administrative. General and administrative costs increased by $7.6 million, or 21%, for the six months ended June 30, 2025 compared to the six months ended June 30, 2024, primarily due to the acquisition of Former TechTarget in December 2024 which contributed $24.2 million in the six months ended June 30, 2025. This was partially offset by a reduction in costs of $16.6 million due to a decrease in focus on general and administrative (primarily labor and related costs) and an increase in focus on cost of revenues and selling and marketing.

Product Development. Product development costs decreased by $0.5 million, or (9)% for the six months ended June 30, 2025 compared to the six months ended June 30, 2024, primarily due to a decrease of $3.6 million driven by a reduction in focus (primarily labor and related costs) on product development and an increase in focus on cost of revenues and selling and marketing. This was offset by the acquisition of Former TechTarget in December 2024 which contributed $3.1 million in labor and related costs.

Depreciation. Depreciation expense increased $0.3 million, or 35% for the six months ended June 30, 2025 compared to the six months ended June 30, 2024, due to the acquisition of Former TechTarget in December 2024.

Amortization. Amortization expense increased $24.2 million, or 110% for the six months ended June 30, 2025 compared to the six months ended June 30, 2024, due to the acquisition of Former TechTarget in December 2024, which contributed $24.9 million in amortization expenses.

Impairment of Goodwill. As a result of the impairment analysis in the first two quarters of 2025, an impairment charge of $841.3 million was recorded relating to the Canalys, Industry Dive, NetLine, Bluefin Legacy and legacy TechTarget reporting units for the six months ended June 30, 2025. Due to the continued decrease in our stock price and overall market capitalization, along with other qualitative considerations including the continued impact from the conditions in the macroeconomic environment, it was determined a triggering event occurred, indicating goodwill may be impaired. Accordingly, we conducted a quantitative impairment test of our goodwill at June 30, 2025. We estimate the implied fair value of our goodwill primarily using an income approach. Changes in the estimates or assumptions used in our quantitative impairment test could materially affect the determination of fair value and the associated goodwill impairment assessment. Potential events and circumstances that could have an adverse impact on our estimates and assumptions include, but are not limited to continued increases in costs and other macroeconomic factors.

Impairment of Long-Lived Assets. We did not have any impairment of long-lived assets in the six months ended June 30, 2025. Impairment of long-lived assets in the six months ended June 30, 2024 was $2.0 million due to the exit from Industry Dive’s Washington, D.C. office in March 2024.

Acquisition and Integration Costs. Acquisition and integration expense decreased $5.3 million, or (18)%, for the six months ended June 30, 2025 compared to the six months ended June 30, 2024. The acquisition of Former TechTarget in December 2024 contributed $11.6 million as part of the integration in 2025. The $16.9 million decrease was a result of decreased professional fees incurred in 2024 associated with the Transaction.

Remeasurement of Contingent Consideration. In the six months ended June 30, 2025, there was no contingent consideration remeasurement. Contingent consideration remeasurement in the six months ended June 30, 2024 was a loss of $4.2 million due to a revision to forecasts to reflect challenging macro-economic conditions, which impacted demand for core email and website sponsorship/advertising products, as technology companies cut back on investment.

Interest expense on related party loans. Interest expense on related party loans decreased $7.8 million, or (63)%, in the six months ended June 30, 2025 compared to the six months ended June 30, 2024. This significant reduction resulted from the August 2024 settlement of a related party loan originally established to finance the Industry Dive acquisition in fiscal 2022. The loan settlement eliminated associated interest obligations, substantially reducing financing costs in the current reporting period and reflecting improved capital structure following debt resolution. The acquisition of Former TechTarget in December 2024 did not have a material impact on the balance.

Interest Income. Interest income decreased $1.6 million, or (64)%, for the six months ended June 30, 2025 compared to the six months ended June 30, 2024, due to lower cash balances in the current period.

Other Income (expense). Other expense increased by $8.7 million, or 2,342%, for the six months ended June 30, 2025 compared to the six months ended June 30, 2024. The acquisition of Former TechTarget in December 2024 contributed $4.6 million of expense in 2025. The increase in expense is related to foreign currency transactions.

Income Tax Benefit (Expense). Income tax expense for the six months ended June 30, 2025 was $6.8 million, an increase of $13.5 million compared to the income tax benefit of $6.7 million in the six months ended June 30, 2024. The effective tax rate was 0.7% and (10.1%) for the six months ended June 30, 2025 and 2024, respectively. In 2025, the effective tax rate was primarily driven by a non-deductible goodwill impairment, which was not treated as a discrete item due to our history of impairments, and geographic mix of earnings. In 2024, the effective tax rate was primarily driven by non-taxable contingent consideration and non-deductible goodwill impairment.

Liquidity and Capital Resources

At June 30, 2025, our cash and cash equivalents totaled $61.7 million. We utilized cash, short-term investments and $135.0 million of our $250.0 million revolving Credit Facility with Informa to retire approximately $417.0 million of our convertible debt on January 24, 2025. In June 2025, Informa TechTarget paid down $15.0 million on the Credit Facility. We believe that our existing cash and cash equivalents plus our remaining availability under the revolving Credit Facility will be sufficient to meet our anticipated cash needs for at least the next 12 months.

Informa TechTarget’s primary recurring use of cash is payment of operating costs, which consist primarily of employee-related expenses, such as compensation and benefits, as well as operating expenses for product development, marketing, facilities and overhead costs.

Cash Flows

Net cash provided by (used in) operating activities

Cash flows provided by operating activities for the six months ended June 30, 2025 was $13.7 million, a $44.8 million increase compared to the operating cash outflow for the six months ended June 30, 2024, primarily due to an increase in net loss of $862.3 million as adjusted for non-cash items, which were mainly impacted by (i) higher amortization of $29.3 million due to the acquisition of Former TechTarget and (ii) the combined net impact of the impairment of goodwill related to the Canalys, Industry Dive, NetLine Bluefin Legacy and legacy TechTarget reporting units of $841.3 million.

Net cash provided by (used in) investing activities

Cash flows provided by (used in) from investing activities were $67.9 million and $(3.7) million for the six months ended June 30, 2025 and 2024, respectively. The inflows in the six months ended June 30, 2025 reflected the sale of short-term investments of $76.8 million. The outflows in the six months ended June 30, 2024 reflected increased intangible assets of $5.1 million mainly relating to product development and internally generated software.

Net cash provided by (used in) financing activities

Cash flows provided by (used in) financing activities were $(297.0) million and $32.2 million for the six months ended June 30, 2025 and 2024, respectively. The significant outflow in the six months ended June 30, 2025 was due to the repayment of convertible notes of $417.0 million, partially offset by net borrowings under our Credit Facility of $120.0 million. The inflow for the six months ended June 30, 2024 was due to amounts received from related parties as part of cash pooling arrangements, partially offset by net cash outflows from net Parent investment.

Off Balance Sheet Arrangements

As of June 30, 2025 and December 31, 2024, Informa TechTarget did not have any significant off-balance sheet arrangements.

Cautionary Note Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q (the “Quarterly Report”) contains “forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities and Exchange Act of 1934 as amended (the “Exchange Act”), that involve substantial risks and uncertainties. All statements, other than historical facts, are forward-looking statements, including: statements regarding the expected benefits of the Transactions such as improved operations, enhanced revenues and cash flow, synergies, growth potential, market profile, business plans, expanded portfolio and financial strength; our expectations surrounding the Transactions and our ability to grow our business and bolster our financial position; our expected contractual obligations and capital expenditures; our future results of operations and financial position; industry and business trends; the impact of market conditions and other macroeconomic factors on our business, financial condition and results of operations; our future business strategy, plans, market growth and our objectives for future operations; the continued remediation of material weaknesses in our internal control over financial reporting; and our competitive market position within our industry. Forward-looking statements concern future circumstances and results and other statements that are not historical facts and are sometimes identified by the words “may,” “will,” “should,” “potential,” “intend,” “expect,” “endeavor,” “seek,” “anticipate,” “estimate,” “overestimate,” “underestimate,” “believe,” “plan,” “could,” “would,” “project,” “predict,” “continue,” “target,” or the negatives of these words or other similar terms or expressions that concern our expectations, strategy, priorities, plans, or intentions. Forward-looking statements are based upon current plans, estimates, and expectations that are subject to risks, uncertainties, and assumptions. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those indicated or anticipated by such forward-looking statements.

We can give no assurance that such plans, estimates, or expectations will be achieved, and therefore, actual results may differ materially from any plans, estimates, or expectations in such forward-looking statements. Important factors that could cause actual results to differ materially from such plans, estimates, or expectations include, among others: unexpected costs, charges, or expenses resulting from the Transactions; uncertainty regarding our expected financial performance; failure to realize the anticipated benefits of the Transactions, including as a result of integrating our Informa Tech Digital Business with our legacy TechTarget business; our ability to implement our business strategy; difficulties and delays in achieving revenue and cost synergies; evolving legal, regulatory, and tax regimes; changes in economic, financial, political, and regulatory conditions in the United States and elsewhere, and other factors that contribute to uncertainty and volatility; natural and man-made disasters, civil unrest, pandemics, geopolitical uncertainty and conflicts, and conditions that may result from legislative, regulatory, trade, and policy changes associated with the current or subsequent U.S. administrations; our ability to meet expectations regarding the accounting and tax treatments of the Transactions; market acceptance of our products and services; the impact of pandemics and future health epidemics and any related economic downturns on us and the markets in which we and our customers operate; changes in economic or regulatory conditions or other trends affecting the internet, internet advertising and IT industries; data privacy and artificial intelligence laws, rules, and regulations; the impact of foreign currency exchange rates; certain macroeconomic factors facing the global economy, including instability in the regional banking sector, disruptions in the capital markets, economic sanctions and economic slowdowns or recessions, tariffs and trade disputes, rising inflation and interest rate fluctuations on our operating results; and other matters included in our filings with the SEC.

Other factors may affect the accuracy and reliability of forward-looking statements. We caution you not to place undue reliance on any of these forward-looking statements as they are not guarantees of future performance or outcomes. Actual performance and outcomes, including, without limitation, our actual results of operations, financial condition and liquidity, may differ materially from those made in or suggested by the forward-looking statements contained in this Quarterly Report.

Any forward-looking statements speak only as of the date of this Quarterly Report. Neither we, nor our affiliates, advisors or representatives, undertake any obligation to update any forward-looking statements, whether as a result of new information or developments, future events, or otherwise, except as required by applicable law.

Market risk represents the risk of loss that may impact our financial position due to adverse changes in financial market prices and rates. Our market risk exposure is primarily a result of fluctuations in foreign exchange rates and interest rates. We do not hold or issue financial instruments for trading purposes.

Foreign currency exchange risk

We currently have subsidiaries in the United Kingdom, Hong Kong, China, Australia, Singapore, Germany and France. Approximately 30% and 31% of our revenues for the three and six months ended June 30, 2025, respectively, were derived from customers with billing addresses outside of the United States and our foreign exchange losses were not significant. We currently believe our exposure to foreign currency exchange rate fluctuations is financially immaterial and therefore have not entered into foreign currency hedging transactions. We continue to review this issue and may consider hedging certain foreign exchange risks through the use of currency futures or options in the future. The volatility of exchange rates depends on many factors that we cannot forecast with reliable accuracy. Our continued international expansion increases our exposure to exchange rate fluctuations and as a result such fluctuations could have a significant impact on our future results of operations. We also maintain receivables and cash accounts denominated in currencies other than the local currency, which exposes us to foreign exchange rate movements.

In addition, our foreign subsidiaries have certain amounts of Goodwill and Intangibles which expose us to foreign currency exchange rate fluctuations. These exchange rate fluctuations are included as a component of other comprehensive (loss) income.

Interest rate risk

At June 30, 2025, we had cash and cash equivalents totaling $61.7 million. The cash and cash equivalents were held for working capital purposes. Due to the short-term nature of these investments, we believe that we do not have any material exposure to changes in the fair value of our investment portfolio as a result of changes in interest rates. Declines in interest rates, however, would reduce future investment income.

We are exposed to market risk for changes in interest rates related to our Credit Facility, which provides for borrowing up to $250.0 million. Interest on the Credit Facility is calculated by reference to the SOFR, plus 2.5% per annum. Assuming that the amounts available under the Credit Facility were fully drawn, a 1% increase in interest rates would result in an increase in annual interest expense and a decrease in our cash flows of $2.5 million per year.

Inflation

Although we cannot accurately anticipate the future effect of inflation on our financial condition or results of operations, inflation historically has not had a material impact on our operations. If our costs were to become subject to significant inflationary pressures, we may not be able to fully offset such higher costs through price increases for services. Our inability to do so could harm our business, financial condition or results of operations.

Limitations on effectiveness of controls and procedures

We maintain disclosure controls and procedures (as that term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act that are designed to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosures. In designing and evaluating our disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints and that management is required to apply judgment in evaluating the benefits of our controls and procedures relative to their costs.

Evaluation of disclosure controls and procedures

Our management, with the participation of our principal executive officer and principal financial officer, evaluated, as of the end of the period covered by this Quarterly Report on Form 10-Q, the effectiveness of our disclosure controls and procedures (as that term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act). Based on that evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were not effective as of June 30, 2025, due to the material weaknesses in our internal control over financial reporting as described below.

Notwithstanding the material weaknesses, and based on the additional analyses and other procedures management performed, we have concluded that our unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q state fairly, in all material respects, our financial position and results of operations and cash flows as of each of the dates, and for each of the periods, in accordance with generally accepted accounting principles in the United States of America.

Material weaknesses in internal control over financial reporting

A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis. As previously disclosed, management identified the following material weaknesses in internal control over financial reporting as of December 31, 2024, which remained unremediated as of June 30, 2025:

• We did not design and maintain an effective control environment as we lacked a sufficient complement of personnel with an appropriate level of internal controls and accounting knowledge, training and experience commensurate with our financial reporting requirements. The limited personnel resulted in our inability to consistently establish appropriate authorities and responsibilities in pursuit of our financial reporting objectives, as demonstrated by, among other things, insufficient segregation of duties in our finance and accounting functions.
• We did not design and maintain effective controls in response to the risks of material misstatement as changes to existing controls or the implementation of new controls were not sufficient to respond to changes to the risks of material misstatement to financial reporting.
• We did not design and maintain effective monitoring controls to ascertain whether the components of internal control are present and functioning, and information and communication controls to support the functioning of internal control.

These material weaknesses contributed to the following additional material weaknesses:

• We did not design and maintain effective controls over the period-end financial reporting process to achieve complete, accurate, and timely financial accounting, reporting and disclosures, including the classification of various accounts in the financial statements and the presentation and disclosure of items in the consolidated financial statements.
• We did not design and maintain effective controls to analyze, account for and disclose non-routine, unusual or complex transactions. Specifically, we did not design and maintain controls to timely analyze and account for acquisition transactions and asset impairments.
• We did not design and maintain formal accounting policies, procedures, and controls to achieve complete, accurate, and timely financial accounting, reporting and disclosures, including controls over the preparation and review of

account reconciliations and journal entries, and control activities related to all significant accounts and disclosures, including controls to validate reliability of system-generated information used in the controls.

The material weaknesses related to the lack of sufficient complement of personnel with an appropriate level of internal controls and accounting knowledge, training and experience, risk assessment, lack of effective controls over the period-end financial reporting process, lack of effective controls related to non-routine, unusual or complex transactions, and the lack of effective control activities related to all significant accounts and disclosures resulted in the restatement of the Company’s financial statements as of December 31, 2023 and for the years ended December 31, 2023 and 2022, including opening net parent investment, and for the three months, six months and nine months ended March 31, 2024 and 2023, June 30, 2024 and 2023 and September 30, 2024 and 2023, respectively; and adjustments recorded in conjunction with the preparation of the financial statements as of and for the year ended December 31, 2024 related to acquisition and integration related costs and certain accrued expenses.

Additionally, the material weaknesses could result in a misstatement of the consolidated financial statements and disclosures that would result in a material misstatement to the annual or interim consolidated financial statements that would not be prevented or detected.

In addition to the foregoing, we did not design and maintain effective controls over information technology (“IT”) general controls for information systems that are relevant to the preparation of our consolidated financial statements, specifically, with respect to: (i) program change management controls for financial systems to ensure that IT program and data changes affecting financial IT applications and underlying accounting records are identified, tested, authorized, and implemented appropriately; (ii) user access controls to ensure appropriate segregation of duties and that adequately restrict user and privileged access to financial applications, programs, and data to appropriate company personnel; (iii) computer operations controls to ensure that critical batch jobs are monitored and data backups are authorized and monitored; and (iv) testing and approval controls for program development to ensure that new software development is aligned with business and IT requirements. These IT deficiencies did not result in a misstatement to the consolidated financial statements; however, the deficiencies, when aggregated, could impact maintaining effective segregation of duties, as well as the effectiveness of IT-dependent controls (such as automated controls that address the risk of material misstatement to one or more assertions, along with the IT controls and underlying data that support the effectiveness of system-generated data and reports) that could result in misstatements potentially impacting all financial statement accounts and disclosures that would not be prevented or detected. Accordingly, management has determined these deficiencies in the aggregate constitute a material weakness.

Remediation of Previously Identified Material Weaknesses

With the oversight of the Audit Committee of the Board of Directors, management is in the process of developing a detailed remediation plan to address the material weaknesses. Elements of the plan include the following:

• We have hired, and will continue to hire, additional accounting personnel to bolster our reporting, technical accounting, and internal control capabilities. Additionally, we are in the process of designing and implementing controls to formalize roles and review responsibilities to align with our team’s skills and experience and designing and implementing controls over segregation of duties.
• We have engaged a third-party advisory firm to assist in the design and implementation of control activities across the business processes that support the Company’s significant accounts and disclosures.
• With the assistance of a third-party advisory firm, we will design and implement a formal financial statement risk assessment in order to identify material financial statement line items for which key controls are needed in order to ensure complete and accurate financial reporting.
• We will design and implement a suite of entity-level controls, including monitoring activities to ascertain whether the components of internal control are present and functioning, and information and communication controls to support the functioning of internal control.
• We will design and implement training procedures within the Company’s accounting and finance functions to enhance knowledge and understanding of internal control over financial reporting.
• We are developing a detailed remediation plan which include activities related to creating and maintaining formal accounting policies, procedures and controls to achieve complete, accurate and timely financial accounting, reporting and disclosures; designing and implementing controls related to the preparation and review of journal entries and account reconciliations to ensure proper segregation of duties; designing and implementing controls related to the identification and evaluation of the accounting for non-routine, unusual or complex transactions; and information technology general controls for all relevant information systems, including controls

over program change management, the review, approval and update of user access rights and privileges, controls over batch jobs and data backups, and program development approvals and testing for new systems.

The process of designing and maintaining effective internal control over financial reporting is a continuous effort that requires management to anticipate and react to changes in our business, economic, and regulatory environments and to expend significant resources. As we continue to evaluate our internal control over financial reporting, we may take additional actions to remediate the material weaknesses or modify the remediation actions described above.

While we will devote significant time and attention to these remediation efforts, the material weaknesses will not be considered remediated until management completes the design and implementation of the actions described above and the controls operate for a sufficient period of time, and management has concluded, through testing, that these controls are effective.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the quarter ended June 30, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Our business is subject to a number of risks that could have a material effect on our business, results of operations, financial condition and/or liquidity and that could cause our operating results to vary significantly from period to period. In addition to the other information set forth in this Quarterly Report on Form 10-Q, you should carefully consider the risk factors we have previously disclosed in Item 1A – “Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2024, filed with the SEC on May 28, 2025. We may disclose changes to any risk factors presented or disclose additional factors from time to time in our future filings with the SEC.