2024<\/b><\/p>\n<\/td>\n<\/tr>\n\n| \n Revenue<\/b><\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n |
\n| \n \nSubscription services\n<\/p>\n<\/td>\n | \n \n$\n<\/p>\n<\/td>\n | \n \n227,491\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n$\n<\/p>\n<\/td>\n | \n \n211,903\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n |
\n| \n \nSubscription license\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n186,555\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n63,338\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n |
\n| \n \nConsulting\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n60,421\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n54,047\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n |
\n| \n \nPerpetual license\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n1,166\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n859\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n |
\n| \n \nTotal revenue\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n475,633\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n330,147\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n |
\n| \n Cost of revenue<\/b><\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n |
\n| \n \nSubscription services\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n38,128\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n35,824\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n |
\n| \n \nSubscription license\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n386\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n643\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n |
\n| \n \nConsulting\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n63,934\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n58,182\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n |
\n| \n \nPerpetual license\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n2\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n9\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n |
\n| \n \nTotal cost of revenue\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n102,450\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n94,658\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n |
\n| \n \nGross profit\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n373,183\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n235,489\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n |
\n| \n Operating expenses<\/b><\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n |
\n| \n \nSelling and marketing\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n138,069\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n127,695\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n |
\n| \n \nResearch and development\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n74,286\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n72,113\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n |
\n| \n \nGeneral and administrative\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n33,828\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n23,527\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n |
\n| \n \nLitigation settlement, net of recoveries\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u2014\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n32,403\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n |
\n| \n \nRestructuring\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n11\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n163\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n |
\n| \n \nTotal operating expenses\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n246,194\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n255,901\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n |
\n| \n \nIncome (loss) from operations\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n126,989\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n(20,412\n<\/p>\n<\/td>\n | \n \n)\n<\/p>\n<\/td>\n<\/tr>\n |
\n| \n \nForeign currency transaction (loss)\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n(5,325\n<\/p>\n<\/td>\n | \n \n)\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n(3,262\n<\/p>\n<\/td>\n | \n \n)\n<\/p>\n<\/td>\n<\/tr>\n |
\n| \n \nInterest income\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n5,335\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n5,281\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n |
\n| \n \nInterest expense\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n(1,027\n<\/p>\n<\/td>\n | \n \n)\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n(1,752\n<\/p>\n<\/td>\n | \n \n)\n<\/p>\n<\/td>\n<\/tr>\n |
\n| \n \n(Loss) income on capped call transactions\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n(223\n<\/p>\n<\/td>\n | \n \n)\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n3,299\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n |
\n| \n \nOther income, net\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n561\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n1,684\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n |
\n| \n \nIncome (loss) before provision for (benefit from) income taxes\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n126,310\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n(15,162\n<\/p>\n<\/td>\n | \n \n)\n<\/p>\n<\/td>\n<\/tr>\n |
\n| \n \nProvision for (benefit from) income taxes\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n40,888\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n(3,038\n<\/p>\n<\/td>\n | \n \n)\n<\/p>\n<\/td>\n<\/tr>\n |
\n| \n \nNet income (loss)\n<\/p>\n<\/td>\n | \n \n$\n<\/p>\n<\/td>\n | \n \n85,422\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n$\n<\/p>\n<\/td>\n | \n \n(12,124\n<\/p>\n<\/td>\n | \n \n)\n<\/p>\n<\/td>\n<\/tr>\n |
\n| \n Earnings (loss) per share<\/b><\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n |
\n| \n \nBasic\n<\/p>\n<\/td>\n | \n \n$\n<\/p>\n<\/td>\n | \n \n0.99\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n$\n<\/p>\n<\/td>\n | \n \n(0.14\n<\/p>\n<\/td>\n | \n \n)\n<\/p>\n<\/td>\n<\/tr>\n |
\n| \n \nDiluted\n<\/p>\n<\/td>\n | \n \n$\n<\/p>\n<\/td>\n | \n \n0.91\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n$\n<\/p>\n<\/td>\n | \n \n(0.14\n<\/p>\n<\/td>\n | \n \n)\n<\/p>\n<\/td>\n<\/tr>\n |
\n| \n Weighted-average number of common shares outstanding<\/b><\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n |
\n| \n \nBasic\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n85,902\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n84,266\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n |
\n| \n \nDiluted\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n94,413\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n84,266\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n<\/table>\n \n\n| \n PEGASYSTEMS INC.<\/b><\/p>\n<\/td>\n<\/tr>\n\n| \n UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS<\/b><\/p>\n<\/td>\n<\/tr>\n\n| \n (in thousands)<\/b><\/p>\n<\/td>\n<\/tr>\n\n | \n | \n | \n\u00a0<\/td>\n<\/tr>\n | \n| \n \n\u00a0\n<\/p>\n<\/td>\n | \n March 31, 2025<\/b><\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n December 31, 2024<\/b><\/p>\n<\/td>\n<\/tr>\n\n| \n Assets<\/b><\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nCurrent assets:\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nCash and cash equivalents\n<\/p>\n<\/td>\n | \n \n$\n<\/p>\n<\/td>\n | \n \n231,129\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n$\n<\/p>\n<\/td>\n | \n \n337,103\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nMarketable securities\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n140,607\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n402,870\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nTotal cash, cash equivalents, and marketable securities\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n371,736\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n739,973\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nAccounts receivable, net\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n202,869\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n305,468\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nUnbilled receivables, net\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n179,093\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n173,085\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nOther current assets\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n92,794\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n115,178\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nTotal current assets\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n846,492\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n1,333,704\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nLong-term unbilled receivables, net\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n98,251\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n61,407\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nGoodwill\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n81,186\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n81,113\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nOther long-term assets\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n296,021\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n292,049\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nTotal assets\n<\/p>\n<\/td>\n | \n \n$\n<\/p>\n<\/td>\n | \n \n1,321,950\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n$\n<\/p>\n<\/td>\n | \n \n1,768,273\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n Liabilities and stockholders\u2019 equity<\/b><\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nCurrent liabilities:\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nAccounts payable\n<\/p>\n<\/td>\n | \n \n$\n<\/p>\n<\/td>\n | \n \n16,649\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n$\n<\/p>\n<\/td>\n | \n \n6,226\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nAccrued expenses\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n49,875\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n31,544\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nAccrued compensation and related expenses\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n55,919\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n138,042\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nDeferred revenue\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n469,298\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n423,910\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nConvertible senior notes, net\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u2014\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n467,470\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nOther current liabilities\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n17,395\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n18,866\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nTotal current liabilities\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n609,136\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n1,086,058\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nLong-term operating lease liabilities\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n65,117\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n67,647\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nOther long-term liabilities\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n36,428\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n29,088\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nTotal liabilities\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n710,681\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n1,182,793\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nTotal stockholders\u2019 equity\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n611,269\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n585,480\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nTotal liabilities and stockholders\u2019 equity\n<\/p>\n<\/td>\n | \n \n$\n<\/p>\n<\/td>\n | \n \n1,321,950\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n$\n<\/p>\n<\/td>\n | \n \n1,768,273\n<\/p>\n<\/td>\n<\/tr>\n<\/table>\n \n\n| \n PEGASYSTEMS INC.<\/b><\/p>\n<\/td>\n<\/tr>\n\n| \n UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS<\/b><\/p>\n<\/td>\n<\/tr>\n\n| \n (in thousands)<\/b><\/p>\n<\/td>\n<\/tr>\n\n | \n\u00a0<\/td>\n<\/tr>\n | \n| \n \n\u00a0\n<\/p>\n<\/td>\n | \n Three Months Ended
\n
<\/b>March 31,<\/b><\/p>\n<\/td>\n<\/tr>\n\n| \n \n\u00a0\n<\/p>\n<\/td>\n | \n 2025<\/b><\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n 2024<\/b><\/p>\n<\/td>\n<\/tr>\n\n| \n \nNet income (loss)\n<\/p>\n<\/td>\n | \n \n$\n<\/p>\n<\/td>\n | \n \n85,422\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n$\n<\/p>\n<\/td>\n | \n \n(12,124\n<\/p>\n<\/td>\n | \n \n)\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nAdjustments to reconcile net income (loss) to cash provided by operating activities\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nNon-cash items\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n70,409\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n55,592\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nChange in operating assets and liabilities, net\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n48,397\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n136,678\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nCash provided by operating activities\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n204,228\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n180,146\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nCash provided by (used in) investing activities\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n261,895\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n(132,399\n<\/p>\n<\/td>\n | \n \n)\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nCash (used in) provided by financing activities\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n(575,986\n<\/p>\n<\/td>\n | \n \n)\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n17,899\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nEffect of exchange rate changes on cash, cash equivalents, and restricted cash\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n3,570\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n(2,803\n<\/p>\n<\/td>\n | \n \n)\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nNet (decrease) increase in cash, cash equivalents, and restricted cash\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n(106,293\n<\/p>\n<\/td>\n | \n \n)\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n62,843\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nCash, cash equivalents, and restricted cash, beginning of period\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n341,529\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n232,827\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nCash, cash equivalents, and restricted cash, end of period\n<\/p>\n<\/td>\n | \n \n$\n<\/p>\n<\/td>\n | \n \n235,236\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n$\n<\/p>\n<\/td>\n | \n \n295,670\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n<\/table>\n \n\n| \n PEGASYSTEMS INC.<\/b><\/p>\n<\/td>\n<\/tr>\n\n| \n RECONCILIATION OF SELECTED GAAP AND NON-GAAP MEASURES<\/b><\/p>\n<\/td>\n<\/tr>\n\n| \n (in thousands, except percentages and per share amounts)<\/b><\/p>\n<\/td>\n<\/tr>\n\n | \n\u00a0<\/td>\n<\/tr>\n | \n| \n \n\u00a0\n<\/p>\n<\/td>\n | \n Three Months Ended
\n
<\/b>March 31,<\/b><\/p>\n<\/td>\n<\/tr>\n\n| \n 2025<\/b><\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n 2024<\/b><\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n Change<\/b><\/p>\n<\/td>\n<\/tr>\n\n| \n Net income (loss) – GAAP<\/b><\/p>\n<\/td>\n | \n $<\/b><\/p>\n<\/td>\n | \n 85,422<\/b><\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n $<\/b><\/p>\n<\/td>\n | \n (12,124<\/b><\/p>\n<\/td>\n | \n )<\/b><\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | | \n\n \n*\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nStock-based compensation (1)<\/sup><\/p>\n<\/td>\n| \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n41,425\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n34,781\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nRestructuring\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n11\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n163\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nLegal fees\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n6,544\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n1,942\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nLitigation settlement, net of recoveries\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u2014\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n32,403\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nAmortization of intangible assets\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n701\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n964\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nInterest on convertible senior notes\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n394\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n617\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nCapped call transactions\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n223\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n(3,299\n<\/p>\n<\/td>\n | \n \n)\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nForeign currency transaction loss\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n5,325\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n3,262\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nOther\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n(751\n<\/p>\n<\/td>\n | \n \n)\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n(1,628\n<\/p>\n<\/td>\n | \n \n)\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nIncome taxes (2)<\/sup><\/p>\n<\/td>\n| \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n1,248\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n(14,927\n<\/p>\n<\/td>\n | \n \n)\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nNet income – non-GAAP\n<\/p>\n<\/td>\n | \n \n$\n<\/p>\n<\/td>\n | \n \n140,542\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n$\n<\/p>\n<\/td>\n | \n \n42,154\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n233\n<\/p>\n<\/td>\n | \n \n%\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n Diluted earnings (loss) per share – GAAP<\/b><\/p>\n<\/td>\n | \n $<\/b><\/p>\n<\/td>\n | \n 0.91<\/b><\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n $<\/b><\/p>\n<\/td>\n | \n (0.14<\/b><\/p>\n<\/td>\n | \n )<\/b><\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | | \n\n \n*\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nnon-GAAP adjustments\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n0.62\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n0.62\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nDiluted earnings per share – non-GAAP\n<\/p>\n<\/td>\n | \n \n$\n<\/p>\n<\/td>\n | \n \n1.53\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n$\n<\/p>\n<\/td>\n | \n \n0.48\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n219\n<\/p>\n<\/td>\n | \n \n%\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n Diluted weighted-average number of common shares outstanding – GAAP<\/b><\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n 94,413<\/b><\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n 84,266<\/b><\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n12\n<\/p>\n<\/td>\n | \n \n%\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nCapped call transactions\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n(2,425\n<\/p>\n<\/td>\n | \n \n)\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u2014\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nStock-based compensation\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u2014\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n3,094\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \nDiluted weighted-average number of common shares outstanding – non-GAAP\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n91,988\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n87,360\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n\u00a0\n<\/p>\n<\/td>\n | \n \n5\n<\/p>\n<\/td>\n | \n \n%\n<\/p>\n<\/td>\n<\/tr>\n | \n| \n \n* Not meaningful\n<\/p>\n<\/td>\n | | \n | \n | \n | \n | \n | \n | \n | \n | \n\u00a0<\/td>\n<\/tr>\n<\/table>\n \nOur non-GAAP financial measures reflect the following adjustments:\n<\/p>\n \n- Stock-based compensation<\/span>: We have excluded stock-based compensation from our non-GAAP operating expenses and profitability measures. Although stock-based compensation is a key incentive offered to our employees, and we believe such compensation contributed to our revenues recognized during the periods presented and is expected to contribute to our future revenues, we continue to evaluate our business performance, excluding stock-based compensation.\n<\/li>\n
- Restructuring<\/span>: We have excluded restructuring from our non-GAAP financial measures. Restructuring fluctuates in amount and frequency and is significantly affected by the timing and size of our restructuring activities. We believe excluding these amounts from our non-GAAP financial measures is useful to investors as these amounts are not representative of our core business operations and ongoing operational performance.\n<\/li>\n
- Legal fees:<\/span> Legal and related fees arising from proceedings outside the ordinary course of business. We believe excluding these amounts from our non-GAAP financial measures is useful to investors as the types of events giving rise to them are not representative of our core business operations and ongoing operational performance.\n<\/li>\n
- Litigation settlement, net of recoveries<\/span>: Cost to settle litigation, net of insurance recoveries, arising from proceedings outside the ordinary course of business. See “Note 20. Commitments And Contingencies” in Item 8 of our Annual Report filed on Form 10-K for the year ended December 31, 2024 and prior filings for further information. We believe excluding these amounts from our non-GAAP financial measures is useful to investors as the types of events giving rise to them are not representative of our core business operations and ongoing operational performance.\n<\/li>\n
- Amortization of intangible assets<\/span>: We have excluded the amortization of intangible assets from our non-GAAP operating expenses and profitability measures. Amortization of intangible assets fluctuates in amount and frequency and is significantly affected by the timing and size of acquisitions. Investors should note that intangible assets contributed to our revenues recognized during the periods presented and are expected to contribute to future revenues. Amortization of intangible assets is likely to recur in future periods. We believe excluding these amounts provides a useful comparison of our operational performance in different periods.\n<\/li>\n
- Interest on convertible senior notes<\/span>: In February 2020, we issued convertible senior notes (the \u201cNotes\u201d), due March 1, 2025, in a private placement. The Notes accrued interest at an annual rate of 0.75%, paid semi-annually in arrears on March 1 and September 1. The outstanding Notes were repaid in their entirety at maturity. We believe that excluding the amortization of issuance costs provides a useful comparison of our operational performance in different periods.\n<\/li>\n
- Capped call transactions<\/span>: We have excluded gains and losses related to our capped call transactions held at fair value under U.S. GAAP. The capped call transactions were expected to reduce common stock dilution and\/or offset any potential cash payments we must make, other than for principal and interest, upon conversion of the Notes. We believe excluding these amounts from our non-GAAP financial measures is useful to investors as the types of events giving rise to them are not representative of our core business operations and ongoing operational performance.\n<\/li>\n
- Foreign currency transaction loss<\/span>: We have excluded foreign currency transaction gains and losses from our non-GAAP profitability measures. Foreign currency transaction gains and losses fluctuate in amount and frequency and are significantly affected by foreign exchange market rates. Foreign currency transaction gains and losses are likely to recur in future periods. We believe excluding these amounts provides a useful comparison of our operational performance in different periods.\n<\/li>\n
- Other<\/span>: We have excluded gains and losses from our venture investments. We believe excluding these amounts from our non-GAAP financial measures is useful to investors as the types of events giving rise to them are not representative of our core business operations and ongoing operational performance.\n<\/li>\n
- Diluted weighted-average number of common shares outstanding<\/span>:\n
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