Ibotta, Inc.IBTA
Ibotta, Inc. Stock Compensation Disclosure
Stock-Based Compensation
Stock-Based Compensation Expense
The Company’s stock-based compensation expense is recorded as follows (in thousands):
| Year ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| Cost of revenue | $ | 2,582 | $ | 1,484 | $ | 659 | |||||||||||
Sales and marketing(1) | 18,732 | 39,086 | 15,420 | ||||||||||||||
| Research and development | 10,271 | 9,325 | 2,074 | ||||||||||||||
| General and administrative | 21,321 | 26,321 | 2,015 | ||||||||||||||
| Total stock-based compensation expense | $ | 52,906 | $ | 76,216 | $ | 20,168 | |||||||||||
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(1)Sales and marketing includes common stock warrant expense of $8.8 million, $29.3 million, and $13.2 million recognized during the years ended December 31, 2025, 2024, and 2023, respectively. See Note 9 – Stockholders’ Equity.
During the years ended December 31, 2025, 2024, and 2023, the Company capitalized $1.1 million, $0.4 million, and $0.4 million, respectively, of stock-based compensation expense to software development costs. During the years ended December 31, 2025 and 2024, the Company recognized tax benefits related to stock-based compensation of $5.1 million and $13.9 million, respectively, which are reflected in the Company’s provision for (benefit from) income taxes. The Company recognized no tax benefit related to stock-based compensation during the year ended December 31, 2023.
Unrecognized stock-based compensation expense as of December 31, 2025 was $98.4 million for unvested restricted stock units, $4.0 million for unvested stock options, and $0.5 million for the ESPP and is expected to be recognized over a weighted average period of 3.0 years, 1.6 years, and 0.4 years, respectively.
Equity Incentive Plan
In April 2024, the Company’s board of directors approved the 2024 Equity Incentive Plan (2024 Plan), which became effective in connection with the IPO. The 2024 Plan provides for the grant of stock options, restricted stock, restricted stock units (RSUs), stock appreciation rights, performance units, and performance shares to eligible employees, directors, and consultants. The 2011 Equity Incentive Plan (2011 Plan), which terminated effective immediately prior to the effectiveness of the 2024 Plan, provided for the grant of various stock awards to employees of the Company, including incentive stock options, nonqualified stock options, and RSUs.
As of December 31, 2025, the maximum number of shares of the Company’s Class A common stock that may be issued under the 2024 Plan is equal to 6,540,979 shares. The number of shares available for issuance automatically increases on the first day of each fiscal year of the Company, beginning on January 1, 2025, in an amount equal to the least of (i) 5,400,000 shares, (ii) 5% of the outstanding shares of all classes of the Company’s common stock on the last day of the immediately preceding fiscal year, or (iii) such number of shares determined by the Administrator no later than the last day of the immediately preceding fiscal year. Pursuant to this automatic increase feature of the 2024 Plan, an additional 1,547,571 shares were reserved for issuance effective January 1, 2025.
Stock Options
The Company’s option awards typically vest over a - or four-year period and expire 10 years from the grant date. The exercise price of the option awards is typically equal to the fair value of the Company’s common stock at the date of grant. As defined in the individual option award agreements, certain option awards provide for accelerated vesting if there is a sale of the Company and the outlined employees are terminated in a specific time period thereafter.
A summary of option activity for the year ended December 31, 2025 is as follows:
| Options | Weighted Average Exercise Price | Weighted Average Remaining Contractual Term (in years) | Aggregate Intrinsic Value (in thousands) | ||||||||||||||||||||
Options outstanding as of December 31, 2024 | 3,279,483 | $ | 15.49 | 6.5 | $ | 162,641 | |||||||||||||||||
| Exercised | (594,148) | 15.36 | |||||||||||||||||||||
| Forfeited or expired | (160,274) | 17.06 | |||||||||||||||||||||
| Options outstanding as of end of period | 2,525,061 | 15.42 | 5.3 | 19,780 | |||||||||||||||||||
Options vested and exercisable as of December 31, 2025 | 2,189,326 | $ | 14.77 | 5.0 | $ | 18,017 | |||||||||||||||||
The total intrinsic value of stock options exercised during the years ended December 31, 2025, 2024, and 2023 was $17.2 million, $54.6 million, and $2.8 million, respectively. The total fair value of stock options vested during the years ended December 31, 2025, 2024, and 2023 was $6.4 million, $16.7 million, and $10.0 million, respectively.
During the year ended December 31, 2024, the Company modified certain stock option awards granted to named executive officers in connection with the IPO. This modification accelerated the vesting and increased the fair value of the stock options by $3.0 million. Additionally, as a result of the IPO, the liquidity event condition associated with these stock options was satisfied, and we recognized an $11.4 million cumulative stock-based compensation expense adjustment associated with the stock options for which the portion of the service period had been satisfied and vested through achievement of the liquidity event condition upon the IPO. Prior to the IPO, no stock-based compensation expense was recognized for these stock options as the liquidity event condition was not probable.
No options were granted during the year ended December 31, 2025. The weighted average grant date fair value for options granted during the years ended December 31, 2024 and 2023, was $21.40 and $9.00, respectively. The fair value of options granted was estimated using the Black Scholes option-pricing model using the following weighted average assumptions:
| Year ended December 31, | |||||||||||
| 2024 | 2023 | ||||||||||
Risk-free interest rate | 4.07 | % | 4.16 | % | |||||||
Expected dividend yield | — | — | |||||||||
| Expected volatility | 75 | % | 71 | % | |||||||
Expected term (in years) | 6.1 | 6.0 | |||||||||
Restricted Stock Units (RSUs)
RSUs granted after the IPO are subject to a service-based vesting condition, which is typically satisfied over a four-year period.
A summary of RSU activity for the year ended December 31, 2025 is as follows:
| RSUs | Weighted Average Grant Date Fair Value per Share | ||||||||||
Unvested and outstanding as of December 31, 2024 | 1,043,621 | $ | 63.35 | ||||||||
| Granted | 2,360,646 | 50.20 | |||||||||
| Vested | (499,501) | 64.79 | |||||||||
| Forfeited or expired | (468,507) | 63.55 | |||||||||
Unvested and outstanding as of December 31, 2025 | 2,436,259 | $ | 50.28 | ||||||||
The total fair value of RSUs vested during the years ended December 31, 2025 and 2024, was $32.4 million and $10.0 million, respectively. No RSUs vested during the year ended December 31, 2023.
Prior to and in connection with the IPO, the Company granted RSUs to employees and executives that vest upon the satisfaction of both a service condition and a liquidity event condition (double-trigger awards). As a result of the IPO, the liquidity event condition associated with all double-trigger awards was
deemed probable, and we recognized a $2.6 million cumulative stock-based compensation expense adjustment related to these awards upon the IPO in 2024.
CEO Performance-Based RSU
On April 17, 2024, the Company issued a performance-based RSU award to the CEO (CEO PRSU). The CEO PRSU awards a target number of RSUs to the CEO, totaling 125,216 RSUs, that become eligible to vest based on the Company’s total shareholder return (TSR) relative to the TSRs of the companies in the Russell 2000 Index during the performance period from the grant date through December 31, 2026. A percentage of the target number of RSUs, ranging from zero to 200%, will vest based on the percentile rank of the Company's TSR relative to that of the other companies in the index over the performance period. The award is subject to the CEO’s continued service to the Company, and the TSR condition is a market condition. In addition, the CEO PRSU is subject to acceleration upon a change in control.
The Company estimated the fair value of the CEO PRSU on the April 17, 2024 issuance date using a Monte Carlo simulation that incorporates the probability of achievement of the market condition, resulting in an aggregate grant date fair value of $14.3 million. The key assumptions used include a risk-free rate of 4.76%, an expected volatility of approximately 57%, and an expected term of 2.7 years.
During the years ended December 31, 2025 and 2024, we recognized $5.3 million and $3.7 million, respectively, of stock-based compensation expense related to the CEO PRSU.
Employee Stock Purchase Plan (ESPP)
In April 2024, the Company’s board of directors approved the 2024 ESPP, which became effective in connection with the IPO. Initially, there were 715,000 shares of the Company’s Class A common stock reserved for issuance under the ESPP. The number of shares available for issuance automatically increases on the first day of each fiscal year of the Company, beginning on January 1, 2025, in an amount equal to the least of (i) 1,100,000 shares of Class A common stock, (ii) 1% of the outstanding shares of all classes of the Company’s common stock on the last day of the immediately preceding fiscal year, or (iii) an amount determined by the board of directors. Pursuant to this automatic increase feature of the 2024 ESPP, an additional 309,514 shares were reserved for issuance under the ESPP effective January 1, 2025.
The ESPP allows eligible employees to purchase shares of the Company’s Class A common stock at a discounted price per share through payroll deductions over consecutive offering periods that are approximately six months in length. Each offering period has a single purchase period of the same duration. The offering periods will generally start on the first trading day on or after May 15 and November 15 each year and end on the first trading day on or after the following November 15 and May 15, respectively. The per share purchase price is equal to 85% of the lesser of the fair market value of a
share of the Company’s Class A common stock on (i) the first trading date of the offering period or (ii) the last trading day of the offering period.
During the years ended December 31, 2025 and 2024, the Company recognized stock-based compensation expense related to the ESPP of $1.1 million and $1.6 million, respectively, and issued 92,188 and 48,876 shares, respectively, of its Class A common stock under the ESPP.
The fair value of ESPP shares was estimated using the Black-Scholes option pricing model with the following weighted-average assumptions:
| Year ended December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
Risk-free interest rate | 4.05 | % | 4.96 | % | |||||||
Expected dividend yield | — | — | |||||||||
| Expected volatility | 66 | % | 50 | % | |||||||
Expected term (in years) | 0.5 | 0.5 | |||||||||
About Stock Compensation Disclosures
Stock-based compensation disclosures detail the equity awards granted to employees and executives — including stock options, restricted stock units (RSUs), and performance shares — along with the valuation methods and assumptions used to expense them. This section reveals the true cost of talent retention and the alignment between management incentives and shareholder interests.
Key signals: total unrecognized compensation expense and its expected recognition period signal future earnings headwinds from already-granted awards. For stock options, examine Black-Scholes assumptions — expected volatility, risk-free rate, and expected term — as understating any of these reduces reported compensation expense. Compare stock compensation expense as a percentage of revenue against peers to assess dilution cost. Watch vesting schedules for acceleration clauses tied to change-of-control events. Performance-based awards with undemanding targets may indicate weak governance. Add back stock compensation to operating cash flow to calculate a more conservative free cash flow figure.