Commitments and Contingencies
Purchase Commitments
As of December 31, 2025, the Company had various noncancelable purchase commitments related to hosting service agreements. Future minimum commitments are $15.2 million for 2026, $16.0 million for 2027, $16.0 million for 2028, $16.0 million for 2029, and $13.3 million for 2030 and beyond.
Legal Matters
The Company is subject to various legal proceedings and claims that arise in the ordinary course of business. If the Company determines that it is probable that a loss has been incurred and the amount is reasonably estimable, the Company will record a liability. However, if the Company determines that a contingent loss is reasonably possible and the loss or range of loss can be estimated, the Company will disclose the possible loss in the consolidated financial statements. Legal costs relating to loss contingencies are expensed as incurred.
Indemnification
In the ordinary course of business, the Company may provide indemnification of varying scopes and terms to customers, investors, directors and officers with respect to certain matters, including, but not limited to, losses arising out of the Company’s breach of such agreements, services to be provided by the Company, or from certain claims made by third parties. These indemnification provisions may survive termination of the underlying agreement and the maximum potential amount of future payments the Company could be required to make under these indemnification provisions may not be subject to maximum loss clauses. The maximum potential amount of future payments the Company could be required to make under these indemnification provisions is indeterminable. The Company has never paid a material claim, nor has the Company been sued in connection with these indemnification arrangements.
As of December 31, 2025, the Company has not accrued a liability for these indemnification arrangements because the likelihood of incurring a payment obligation, if any, in connection with these indemnification arrangements is neither probable nor reasonably estimable.
Non-income Taxes
The Company collects and remits sales, use, and other taxes (“non-income taxes”) relating to the sale of the Company’s services in various jurisdictions. The Company accrues non-income taxes that may result from examinations by, or any anticipated negotiated agreements with, these tax authorities when a loss is probable and reasonably estimable. If the Company determines that a loss is reasonably possible and the loss or range of loss can be estimated, then the reasonably possible loss is disclosed. Due to the inherent complexity and uncertainty of these matters and the judicial process in certain jurisdictions, the final outcome may be materially different from the Company’s expectations.
Restructuring
On May 31, 2023, the Company announced and committed to a restructuring plan to optimize its cost structure and drive long-term efficiency in response to the impact of macroeconomic conditions. This plan resulted in a reduction in the Company’s global workforce of approximately 20%. The Company initially recorded restructuring costs of $8.6 million during the year ended December 31, 2023 primarily related to employee severance and continuation of health benefits. Included in the $8.6 million of restructuring costs were non-cash charges of $0.3 million pertaining to fixed asset disposals incurred in conjunction with the restructuring plan. During the year ended December 31, 2023, the Company reversed $1.0 million associated with the restructuring costs liability when it was determined such costs would not need to be paid. Net restructuring costs were presented as $3.4 million in sales and marketing, $3.2 million in research and development, and $1.0 million in general and administrative expenses within the Consolidated Statements of Operations. All restructuring costs incurred during the year ended December 31, 2023 were paid out prior to December 31, 2023.