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What changed in AvePoint, Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of AvePoint, Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+246 added−250 removedSource: 10-K (2025-02-28) vs 10-K (2024-02-29)

Top changes in AvePoint, Inc.'s 2024 10-K

246 paragraphs added · 250 removed · 174 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

51 edited+51 added−34 removed49 unchanged
Biggest changeIn addition, we have built a corporate culture in which privacy and security are enablers of productivity, collaboration and trust; we balance the free flow of information with the risk of inappropriate access and/or disclosure; and we implement a risk-based approach to privacy and security that will allow us to maintain not only legal and regulatory compliance in the jurisdictions in which we operate, but also to facilitate business and innovation at AvePoint. 16 Table of Contents PART I Item 1 Compliance with Material Government Regulations We are subject to many U.S. federal and state and foreign laws and regulations that involve matters central to our business, including laws and regulations that involve data privacy and data protection, intellectual property, advertising, marketing, health and safety, competition, consumer protection, taxation, anti-bribery, anti-money laundering and corruption, economic or other trade prohibitions or sanctions, environmental protection regulations, and securities law compliance.
Biggest changeIn addition, we have built a corporate culture in which privacy and security are enablers of productivity, collaboration and trust; we balance the free flow of information with the risk of inappropriate access and/or disclosure; and we implement a risk-based approach to privacy and security that will allow us to maintain not only legal and regulatory compliance in the jurisdictions in which we operate, but also to facilitate business and innovation at AvePoint.
Rewards We strive to provide globally a competitive suite of pay, comprehensive benefits, and services. We incentivize performance through a combination of competitive base pay, performance-based cash incentives and long-term incentives in the form of equity.
Rewards We strive to provide globally a competitive suite of pay, comprehensive benefits, and services. We incentivize performance through a combination of competitive base pay, performance-based cash incentives and long-term incentives in the form of equity and cash.
We leverage agile development methodologies and work with the latest technologies, resulting in a dynamic, state of the art, automated software development process that has allowed us to quickly deliver high-quality products and services and adapt to market changes and new requirements.
We leverage agile development methodologies and work with the latest technologies, resulting in a dynamic, state of the art, software development process that has allowed us to quickly deliver high-quality products and services and adapt to market changes and new requirements.
This strategy, which combines the expertise of our highly-trained direct sales force with the leverage of valuable indirect routes to the market, including our strong partner ecosystem, has created a powerful and differentiated go-to-market approach.
This strategy, which combines the expertise of our highly-trained direct sales force with the leverage of valuable indirect routes to market, including our strong and growing partner ecosystem, has created a powerful and differentiated go-to-market approach.
By proactively reviewing, updating, and communicating its policies, the company demonstrated its dedication to transparency, accountability, and responsible stewardship in pursuit of its strategic objectives. 15 Table of Contents PART I Item 1 Earning the World ’ s Trust As a global company which is responsible to employees, stockholders and customers, our vision for AvePoint is to build an environment in which we earn trust and confidence every day through enabling collaboration and innovation through our commitment to privacy, security, and transparency.
By proactively reviewing, updating, and communicating our policies, we demonstrated our dedication to transparency, accountability, and responsible stewardship in pursuit of its strategic objectives. 14 Table of Contents PART I Item 1 Earning the World ’ s Trust As a global company which is responsible to employees, stockholders and customers, our vision for AvePoint is to build an environment in which we earn trust and confidence every day through enabling collaboration and innovation through our commitment to privacy, security, and transparency.
The disclosure below describes the goals of our ESG program to allow our stakeholders to be informed about our progress and future direction. 1. Environmental Across our twenty-five offices, we strive to reduce our environmental footprint, operate more efficiently, and engage our personnel in social initiatives that directly impact their lives.
The disclosure below describes the goals of our ESG program to allow our stakeholders to be informed about our progress and future direction. 1. Environmental Across our twenty-eight offices, we strive to reduce our environmental footprint, operate more efficiently, and engage our personnel in social initiatives that directly impact their lives.
Subsequent to the consummation of the Apex Business Combination, on July 26, 2021, Legacy AvePoint’s successor by merger AvePoint US LLC merged with and into AvePoint, Inc. with AvePoint surviving. 20 Table of Contents PART I Item 1A
Subsequent to the consummation of the Apex Business Combination, on July 26, 2021, Legacy AvePoint’s successor by merger AvePoint US LLC merged with and into AvePoint, Inc. with AvePoint surviving. 18 Table of Contents PART I Item 1A
Additional information regarding our Executive Officers is set forth in the Proxy Statement to be filed in connection with our 2024 Annual Meeting of Stockholders within 120 days after the end of the fiscal year ended December 31, 2023. 19 Table of Contents PART I Item 1 Corporate Information Our principal executive offices are located at 525 Washington Blvd, Suite 1400, Jersey City, NJ 07310, and our telephone number is (201) 793-1111.
Additional information regarding our Executive Officers is set forth in the Proxy Statement to be filed in connection with our 2025 Annual Meeting of Stockholders within 120 days after the end of the fiscal year ended December 31, 2024. 17 Table of Contents PART I Item 1 Corporate Information Our principal executive offices are located at 525 Washington Blvd, Suite 1400, Jersey City, NJ 07310, and our telephone number is (201) 793-1111.
We leverage marketplaces to create operational efficiencies with automation in procurement and provisioning, and to grow and scale our acquisition of the small business market, primarily through managed service providers (“ MSPs ”). ■ Microsoft Partnership .
We leverage marketplaces to create operational efficiencies with automation in procurement and provisioning, and to grow and scale our acquisition of the small business market, primarily through managed service providers (“ MSPs ”).
This may include acquiring or investing in complementary products, technologies, and/or businesses that incorporate enhanced functionality into and complement our existing product offerings, reduce the time or costs required to develop new technologies, augment our engineering workforce, improve our internal business and operating systems, and enhance our technological capabilities. 7 Table of Contents PART I Item 1 Sales, Marketing and Customers Sales Our global go-to-market strategy allows us to efficiently sell to and serve the needs of organizations across market segments and geographies.
This may include acquiring or investing in businesses or products with complementary technologies and/or functionality to our existing product offerings, or that reduce the time or costs required to develop new technologies, augment our engineering workforce, improve our internal business and operating systems, and enhance our technological capabilities. 7 Table of Contents PART I Item 1 Sales, Marketing and Customers Sales Our global go-to-market strategy allows us to efficiently sell to and serve the needs of organizations across market segments and geographies.
Tianyi Jiang was appointed as our Chief Executive Officer and a director in July of 2021. Prior to that, Dr. Jiang served as our predecessor company’s Co-Chief Executive Officer alongside Mr. Gong from 2008 to 2021 and director from 2005 to 2021. Dr.
Tianyi Jiang was appointed as our Chief Executive Officer and a director in July of 2021, and previously served as our predecessor company’s Co-Chief Executive Officer alongside Mr. Gong from 2008 to 2021 and director from 2005 to 2021. Dr.
We will also continue investing to support Microsoft, Salesforce, Google, AWS, Box, DropBox and other ecosystems for our customers, many of whom leverage multiple cloud vendors. ■ Expand o ur Market Presence. The market we are targeting is rapidly growing and largely unpenetrated.
We will also continue investing to support Microsoft, Salesforce, Google, AWS, Box, DropBox and other ecosystems for our customers, many of whom leverage multiple cloud vendors. ■ Broaden our Market Presence. The market we are targeting is rapidly growing and largely unpenetrated.
Our professional staff includes programmers, data and computer scientists, electrical and mechanical engineers, software and hardware specialists, project managers, sales and marketing professionals, attorneys, and CPAs. None of our employees are represented by a labor union with respect to their employment. We are not aware of any employment circumstances that are likely to disrupt our work efforts.
Our professional staff includes programmers, data and computer scientists, electrical and mechanical engineers, software and hardware specialists, project managers, sales and marketing professionals, and a multi-disciplinary support infrastructure. None of our employees are represented by a labor union with respect to their employment. We are not aware of any employment circumstances that are likely to disrupt our work efforts.
Our products are typically licensed according to the number of users, while some include a consumption-based component.
The products are typically licensed according to the number of users within the organization, while some include a consumption-based component.
Our goal is to maintain the Investor Relations website as a portal through which investors can easily find or navigate to pertinent information about us, including, but not limited to: ■ Our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and any amendments to those reports, as soon as reasonably practicable after we electronically file that material with or furnish it to the SEC at www.sec.gov. ■ Announcements of investor conferences, speeches, presentations, and events at which our executives discuss our products, services, competitive strategies, and other aspects of our business. ■ Press releases on quarterly results, product and service announcements, legal developments, and national and international news. ■ Corporate governance information including our articles of incorporation, bylaws, governance guidelines, committee charters, code of ethics and business conduct, whistleblower “open door” policy for reporting accounting and legal allegations, global corporate social responsibility initiatives, and other governance-related policies. ■ Other news and announcements that we may post from time to time that investors might find useful or interesting, including news with respect to our business strategies, financial results, and metrics for investors.
At our Investor Relations website, https://www.avepoint.com/ir, we provide, and make available free of charge, a variety of information for investors, including, but not limited to: ■ Our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and any amendments to those reports, as soon as reasonably practicable after we electronically file that material with or furnish it to the SEC at www.sec.gov. ■ Announcements of investor conferences, speeches, presentations, and events at which our executives discuss our products, services, competitive strategies, and other aspects of our business. ■ Press releases on quarterly results, product and service announcements, legal developments, and national and international news. ■ Corporate governance information including our articles of incorporation, bylaws, governance guidelines, committee charters, code of ethics and business conduct, whistleblower “open door” policy for reporting accounting and legal allegations, global corporate social responsibility initiatives, and other governance-related policies. ■ Other news and announcements that we may post from time to time that investors might find useful or interesting, including news with respect to our business strategies, financial results, and metrics for investors.
Lastly, because our platform is built upon a common data engine and common data layer, the purchase of products from multiple suites provides an incremental benefit to customers in the form of more intelligent and relevant data insights and automation. ■ The Control Suite contains products which offer the following capabilities: o Operationalize collaborative workspaces : centralize the management of SaaS solutions and productivity applications, with the flexibility to configure and delegate control for different end-users; o Regulatory compliance automation : Implement, enforce, and prove that access and configuration policies across collaborative workspaces comply with internal or regulatory requirements; o Access and risk management : gain insight into who has access to critical data and where the company is at risk; and o Cost optimization : maximize the return on SaaS subscription investments through real-time management and allocation of entitlements; ■ The Resilience Suite contains products which offer the following capabilities: o Backup-as-a-Service : support workloads in cloud Infrastructure-as-a-Service and PaaS, including protection against ransomware, accidental deletions and user error in a variety of SaaS applications, as well as support for a range of on-premises workloads; o Data classification : automate data tagging, classification and protection to prevent loss; o Storage optimization : archive stale content from active systems to reduce costs and improve workspace quality and user experience; and o Information lifecycle management : manage information and ensure compliance, optimize cloud storage, streamline processes, and unlock data driven insights. ■ The Modernization Suite contains products which offer the following capabilities: o Data modernization and restructuring: seamlessly move and transform legacy data to allow its use by modern SaaS platforms, and ensure that unstructured data can be easily restructured to reflect ongoing changes in the business; o Process modernization: transform manual processes with built-in data insights and process automation for Line of Business and role-based applications; and o Workforce transformation measurement: enable employees to thrive in the digital workplace by ensuring organizational leaders understand employee engagement and sentiment. 6 Table of Contents PART I Item 1 Our Growth Strategy Our aggressive pursuit of the large market opportunity we see includes the following growth strategies: ■ Expand the AvePoint Confidence Platform Offerings.
Lastly, because the AvePoint Confidence Platform is built upon a common data engine and common data layer, the purchase of products from multiple suites provides an incremental benefit to customers in the form of more intelligent and relevant data insights and automation. ■ The Control Suite offers the following capabilities: o Operationalize collaborative workspaces : centralize the management of SaaS solutions and productivity applications, with the flexibility to configure and delegate control for different end-users; o Regulatory compliance automation : Implement, enforce, and prove that access and configuration policies across collaborative workspaces comply with internal or regulatory requirements; o Access and risk management : gain insight into who has access to critical data and where the company is at risk; and o Cost optimization : maximize the return on SaaS subscription investments through real-time management and allocation of entitlements; ■ The Resilience Suite offers the following capabilities: o Backup-as-a-Service : support workloads in cloud Infrastructure-as-a-Service and PaaS, including protection against and recovery from ransomware attacks, accidental deletions and user error in a variety of SaaS applications, as well as support for a range of on-premises workloads; o Data classification : automate data tagging, classification and protection to prevent loss; o Storage optimization : archive stale content from active systems to reduce cloud storage costs and improve data quality; and o Information lifecycle management : manage information and ensure compliance, optimize cloud storage, streamline processes, and unlock data driven insights. ■ The Modernization Suite offers the following capabilities: o Data modernization and restructuring: seamlessly move and transform legacy data for use by modern SaaS platforms; o Process modernization: transform manual processes with built-in data insights and process automation for Line of Business and role-based applications; and o Workforce transformation measurement: enable employees to thrive through AI-powered insights into employee engagement and sentiment. 6 Table of Contents PART I Item 1 Our Growth Strategy Our aggressive pursuit of the enormous long-term market opportunity we see includes the following growth strategies: ■ Accelerate Customer Adoption and Retention .
See the discussion contained in the “ Risk Factors ” section (Part I, Item 1A of this Annual Report) for information regarding how actions by regulatory authorities or changes in legislation and regulation in the jurisdictions in which we operate may have a material adverse effect on our business. 17 Table of Contents PART I Item 1 Information About Our Executive Officers Name Age Position Xunkai Gong 61 Executive Chairman and Director Tianyi Jiang 49 Chief Executive Officer and Director Brian Michael Brown 51 Chief Legal and Compliance Officer, Secretary, and Director James Caci 59 Chief Financial Officer Xunkai Gong was appointed as our Executive Chairman and a director in July of 2021.
See the discussion contained in the “ Risk Factors ” section (Part I, Item 1A of this Annual Report) for information regarding how actions by regulatory authorities or changes in legislation and regulation in the jurisdictions in which we operate may have a material adverse effect on our business. 16 Table of Contents PART I Item 1 Information About Our Executive Officers Name Age Position Xunkai Gong 62 Executive Chairman and Director Tianyi Jiang 50 Chief Executive Officer and Director Brian Michael Brown 52 Chief Legal and Compliance Officer, Secretary, and Director James Caci 60 Chief Financial Officer Xunkai Gong was appointed as our Executive Chairman and a director in July of 2021, and previously served as our predecessor company’s Chairman and Co-Chief Executive Officer alongside Dr.
Historically, our third and fourth quarters have been our highest revenue quarters, however those results are not necessarily indicative of future quarterly revenue or full year results. Additionally, the timing of new product and service introductions can significantly impact revenue.
Historically, our first quarter has been our lowest revenue quarter and our fourth quarter has been our highest revenue quarter, however those results are not necessarily indicative of future quarterly revenue or full year results. Additionally, the timing of new product and service introductions can significantly impact revenue.
We do this by promoting global collaboration and taking pride in helping, sharing, mentoring, and coaching each other. 10 Table of Contents PART I Item 1 Team As of December 31, 2023, we had 2,543 employees globally. A large percentage of our employees have technical and professional backgrounds and undergraduate and/or advanced degrees.
We do this by promoting global collaboration and taking pride in helping, sharing, mentoring, and coaching each other. Team As of December 31, 2024, we had 2,934 employees globally. A large percentage of our employees have technical and professional backgrounds and undergraduate and/or advanced degrees.
In keeping with these principles: ■ A majority of our Board members are independent of AvePoint and its management; ■ All members of our three Board committees—the Audit Committee, the Compensation Committee, and the Nominating and Governance Committee—are independent of AvePoint and its management; ■ We have a transparent and publicly available Code of Ethics and Business Conduct that outlines our corporate policies to which all employees, officers and directors must adhere; ■ We have a corporate compliance training program which requires and monitors trainings given on an annual basis; and ■ The charters of our Board committees clearly establish their respective roles and responsibilities. 14 Table of Contents PART I Item 1 Management of Corporate Governance Resources In 2023, we took significant steps to reinforce our commitment to corporate governance and ethical practices, aligning with our strategic priorities.
In keeping with these principles: ■ A majority of our Board members are independent of AvePoint and its management; ■ All members of our three Board committees—the Audit Committee, the Compensation Committee, and the Nominating and Governance Committee—are independent of AvePoint and its management; ■ We have a transparent and publicly available Code of Ethics and Business Conduct that outlines our corporate policies to which all employees, officers and directors must adhere; ■ We have a corporate compliance training program which requires and monitors trainings given on an annual basis; and ■ The charters of our Board committees clearly establish their respective roles and responsibilities.
From March 2016 to April 2020, Mr. Caci served as the Chief Financial Officer of Nicopure Labs. Mr. Caci brings more than 25 years of experience leading the strategic finance operations at both public and privately held SaaS and IT service companies. Mr. Caci holds a bachelor’s degree from Montclair State University and is a certified public accountant.
Caci brings more than 25 years of experience leading the strategic finance operations at both public and privately held SaaS and IT service companies. Mr. Caci holds a bachelor’s degree from Montclair State University and is a certified public accountant.
To do so, we have made significant investments in our customer success program and in technology which provides additional telemetry to enhance our understanding of how customers use our solutions, which we believe will deepen our relationships with existing customers. ■ Grow and Cultivate our Partner and Channel Network .
To do so, we have made significant investments in our customer success program and in technology which provides additional telemetry to enhance our understanding of how customers use our solutions, which we believe will deepen our relationships with existing customers. ■ Expand the AvePoint Confidence Platform Offerings.
We plan to introduce new and adjacent products to extend our current operational and data management story and to improve the functionality of existing products and features, with a particular focus on AI ready solutions that transform and enrich data.
We have built a differentiated platform that addresses a number of strategic use cases, and we plan to introduce new and adjacent products to extend our current operational and data management value proposition and to improve the functionality of existing products and features, with a particular focus on AI ready solutions that transform and enrich data.
Customers We sell to organizations of all sizes, in all regions of the world, and across a broad array of industries. Our customers are located in more than 100 countries and, as of December 31, 2023, numbered more than 21,000. We classify our customer base by size and geography: ■ Small Business ( “ SMB ” ) segment .
Customers We sell to organizations of all sizes, in all regions of the world, and across a broad array of industries. Our customers are located in more than 100 countries and, as of December 31, 2024, numbered more than 25,000.
We received accolades designating us as a “best place to work” in 2023. Our key human capital objectives in managing our business includes attracting and developing top talent, engaging our team in an environment where they thrive, and integrating diversity, equity, and inclusion principles into our core operating practices.
We received accolades designating us as a “best place to work” in 2024, including recognition from Inc. Magazine and Forbes. Our key human capital objectives include attracting and developing top talent, engaging our team in an environment where they thrive, and integrating our core values into our operating practices.
These practices provide a framework for the proper operation of our company, consistent with our stockholders’ best interests and the requirements of law. We are committed to managing our affairs consistent with the highest principles of business ethics and with the corporate governance requirements of both Nasdaq and applicable law.
We are committed to managing our affairs consistent with the highest principles of business ethics and with the corporate governance requirements of both Nasdaq and applicable law.
Our partner and channel network today touches all aspects of our business, but we believe there is a particular opportunity with our small and mid-sized customers and prospects. We expect that the continued scaling of this ecosystem will be a critical component of our ability to drive profitable growth going forward. ■ Opportunistically Pursue Strategic Acquisitions and Investments .
Our partner network today offers particular value in our pursuit of small and mid-sized customers and prospects, and we continue to invest here to accelerate our market growth. We expect that the continued scaling of this ecosystem will be a critical component of our ability to drive profitable growth going forward. ■ Opportunistically Pursue Strategic Acquisitions and Investments .
We intend to drive new customer growth by leveraging our global partner ecosystem and through the expansion of our direct sales force both in regions where we have an established presence and in new markets where cloud adoption is growing. ■ Increase Customer Lifetime Value with Customer Success .
We have seen strong new customer growth, especially in the small business segment, by leveraging our global partner ecosystem, and through the expansion of our direct sales force both in regions where we have an established presence and in new markets where cloud adoption is growing. ■ Continue Scaling our Partner and Channel Ecosystem .
Built on top of Platform-as-a-Service (“ PaaS ”) architecture, the AvePoint Confidence Platform offers modularity and combines cloud services architecture with tailored, industry-specific functionality to address critical operational challenges and the ongoing management of data, as organizations leverage a variety of third-party cloud vendors, including Microsoft, Salesforce, Google, AWS, Box, DropBox and others.
Built on a Platform-as-a-Service (PaaS) architecture, it combines modularity with tailored, industry-specific functionality to address critical operational challenges and manage data effectively across third-party cloud vendors like Microsoft, Salesforce, Google, AWS, Box, and Dropbox.
We are a top global partner of Microsoft with a holistic alliance that incorporates technology, sales, and marketing initiatives to ensure that we enable organizations worldwide to maximize their Microsoft Cloud investments.
Hyperscalers serve as important supply chain partners to AvePoint and provide the opportunity to scale our technology across global data centers. Today, we are a top global partner of Microsoft with a holistic alliance that incorporates technology, sales, and marketing initiatives to ensure that we enable organizations worldwide to maximize their Microsoft Cloud investments.
James Caci was appointed as our Chief Financial Officer in August of 2021 and previously served as our predecessor company’s Chief Financial Officer from 2010 to 2013. From April 2020 to August of 2021, Mr. Caci held the position of Chief Financial Officer at Brand Value Accelerator, LLC, an industry leading digital commerce services firm.
Caci held the position of Chief Financial Officer at Brand Value Accelerator, LLC, an industry leading digital commerce services firm. From March 2016 to April 2020, Mr. Caci served as the Chief Financial Officer of Nicopure Labs. Mr.
These collective efforts are supported by our customer success team, which employs a proactive relationship-focused approach designed to ensure that our valued customers get the care they need to rapidly deploy, and receive value from, their technology investment in the AvePoint Confidence Platform.
This team employs a proactive, relationship-focused approach, designed to ensure that our valued customers get the care they need to rapidly deploy, and receive value from, their investment in the AvePoint Confidence Platform and the AvePoint Elements Platform. Our direct sales force is organized by geography and customer size, as discussed further below.
We believe that building and cultivating strategic relationships with partners will enable us to penetrate those markets in which we previously lacked presence and those in which we have a presence that can be expanded.
The ongoing cultivation of our strategic relationships with partners will support the continued penetration of markets in which we previously lacked presence, and those in which we have a presence that can be expanded.
Diversity and inclusion drive our success and is at the core of how we hire, communicate and collaborate to deliver value and excellence. We are committed to fostering an environment where people can bring their whole selves to work and feel a sense of belonging.
We are committed to fostering an environment where people can bring their whole selves to work and feel a sense of belonging.
Recruitment and Internal Mobility We want to attract a pool of diverse and exceptional candidates and support their career growth once they join our team. We seek to hire based on talent, providing opportunities for capable workers from various backgrounds to learn valuable skills in critical operations such as business development, sales, customer support, and customer service.
Recruitment and Internal Mobility We want to attract a pool of diverse and exceptional candidates and support their career growth once they join our team. We seek to hire based on proven experience and potential, providing opportunities to develop in critical operational areas.
Lastly, the mix of revenues in any given quarter can cause fluctuations in our reported results, due to differing revenue recognition principles, as discussed further below.
Lastly, the mix of revenues in any given quarter can cause fluctuations in our reported results, due to differing revenue recognition principles, as discussed further below. 10 Table of Contents PART I Item 1 Human Capital The success of our people is the success of our Company, making our talent strategy a core focus of our operations.
Prior to that, Mr. Brown served as our predecessor company’s General Counsel and Chief Operating Officer from 2004 to 2021 and director from 2008 to 2021. Mr. Brown holds a bachelor’s degree from the University of Michigan and a Juris Doctor from Michigan State University.
Brown holds a bachelor’s degree from the University of Michigan and a Juris Doctor from Michigan State University. James Caci was appointed as our Chief Financial Officer in August of 2021 and previously served as our predecessor company’s Chief Financial Officer from 2010 to 2013. From April 2020 to August of 2021, Mr.
Through internal governance and external collaboration, we aim to set the standard for acceptable and responsible use of AI. 3. Corporate Governance Social Responsibility Support from the Top At AvePoint, our corporate governance practices support our core values of agility, passion, and teamwork.
Through internal governance and external collaboration, we aim to set the standard for acceptable and responsible use of AI.
Unlike traditional vendors primarily focused on data management, data governance, or migration, we provide a spectrum of SaaS solutions and productivity applications for the digital workplace. The competition we see is primarily standalone point solutions that aim to replicate the value provided by our suites or one of the products contained therein.
Our competition is primarily from standalone point solutions that aim to replicate the value provided by our suites or one of the products contained therein.
In addition, our increased investments in our customer success program positions us to continue expanding within our existing customer base, which we believe remains a significant growth opportunity. Our direct sales force is organized by geography and customer size. In addition, we employ a number of indirect routes to market, which include the following: ■ Channel Ecosystem .
In addition, our increased investment in our customer success program, which reflects our strategy of improving both customer adoption and retention, positions us to continue expanding within our existing customer base, which we believe remains a significant growth opportunity.
Prior to that, Mr. Gong had served as our predecessor company’s Chairman and Co-Chief Executive Officer alongside Dr. Jiang from 2008 to 2021, Chief Executive Officer from 2001 to 2008 and director from 2001 to 2021. Mr.
Jiang from 2008 to 2021, Chief Executive Officer from 2001 to 2008 and director from 2001 to 2021. Mr.
We constantly seek to increase customer satisfaction, decrease time to value, reduce customer churn and set up successful land and expand opportunities.
Given the importance of the data we protect, the workloads we service, and the cost and functionality benefits we offer, customers quickly find our solutions to be mission critical. Nevertheless, we constantly seek to increase customer satisfaction, decrease time to value, reduce customer churn and set up successful land and expand opportunities.
While the large majority of our current offerings were built organically, we expect that acquisitions and investments will be an important growth driver for our business. We completed four acquisitions in 2022, and we expect to continue acquiring and investing in businesses and technologies or entering into joint ventures and strategic alliances as part of our long-term business strategy.
While the large majority of our current offerings were built organically, we frequently evaluate whether it is more efficient to build solutions or pursue acquisitions that accelerate our product roadmap. Since 2022, we have completed six small acquisitions, and we expect that strategic acquisitions and investments will be an important growth driver for our business.
Classification is based on the customer’s billing address and is divided into (1) North America; (2) Europe, the Middle East, and Africa (“ EMEA ”); and (3) Asia-Pacific (“ APAC ”). 8 Table of Contents PART I Item 1 Research And Development We constantly seek to develop new offerings, drive improvements to our existing offerings, and enhance support of our existing customer deployments.
As of December 31, 2024, North America represented 44% of our total annual recurring revenue, EMEA represented 35% of our total annual recurring revenue, and APAC represented 21% of our total annual recurring revenue. 9 Table of Contents PART I Item 1 Research And Development We constantly seek to develop new offerings, drive improvements to our existing offerings, and enhance support of our existing customer deployments.
Jiang holds a doctorate and a master’s degree in Data Mining from New York University, in addition to a bachelor’s degree and a master’s degree in Electrical and Computer Engineering from Cornell University. 18 Table of Contents PART I Item 1 Brian Michael Brown was appointed as our Chief Legal and Compliance Officer, Secretary of the Board and a director in July of 2021.
Jiang holds a doctorate and a master’s degree in data mining from New York University, in addition to a bachelor’s degree and a master’s degree in electrical and computer engineering from Cornell University.
This allows infrastructure and operations teams to protect business-critical information across collaborative workspaces. ■ The Resilience Suite. Focused on security and enhanced data protection, the Resilience Suite enables organizations to efficiently and effectively comply with data protection regulations, preserve critical records, and ensure business continuity.
Infrastructure and operations teams can oversee and protect business-critical data across multiple collaboration tools. ■ The Resilience Suite: Designed to ensure business continuity, preserve critical records, and facilitate compliance with regulations.
As our customers seek to rapidly reduce costs, improve productivity and make more informed business decisions, they depend on our platform for data-driven insights, critical business intelligence and ongoing operational value through automation. 4 Table of Contents PART I Item 1 Platform Overview The AvePoint Confidence Platform delivers a comprehensive set of SaaS solutions, empowering users in a variety of technology roles – including IT operations, development operations and cybersecurity – to monitor and secure the digital workplace.
For over 20 years, AvePoint has continually innovated to provide solutions that meet the demands of modern data management, empowering businesses to overcome challenges and unlock new possibilities in an ever-evolving landscape. 4 Table of Contents PART I Item 1 Platform Overview The AvePoint Confidence Platform delivers a comprehensive and integrated set of SaaS solutions, empowering users in a variety of technology roles—including IT operations, development operations, and cybersecurity—to govern and secure the digital workplace.
We sell to organizations of all sizes, in all regions of the world, and across a broad array of industries. While historically we primarily focused on larger, more highly regulated enterprises, the offering of our platform as a SaaS solution makes it more accessible to and in demand from small and medium-sized organizations.
We sell to organizations of all sizes, in all regions of the world, and across a broad array of industries.
One notable outcome of this review was the complete overhaul of our corporate governance site, a crucial resource for stakeholders seeking insight into the company’s policies and procedures. By making our extensive list of policies publicly available at a designated web address, https://ir.avepoint.com/governance/governance-documents/default.aspx, we demonstrated transparency and accountability, fostering trust and confidence among investors, customers, and the broader community.
Each of these policies underscored our commitment to responsible business practices, social responsibility, and environmental stewardship. Our extensive list of corporate policies is publicly available on our website at the following web address, https://www.avepoint.com/ir/governance/governance-documents. We strive to continue to demonstrate transparency and accountability, fostering trust and confidence among investors, customers, and the broader community.
This approach aimed to empower all employees to understand and adhere to company policies, furthering our goal of fostering a culture of compliance and ethical conduct across the organization. Our initiatives in 2023 underscored our commitment to robust corporate governance, ethical business practices, and employee empowerment.
Our initiatives in 2024 underscored our commitment to robust corporate governance, ethical business practices, and employee empowerment.
This provides regulatory, audit, and risk management teams with the assurance that the organization is meeting its compliance obligations. ■ The Modernization Suite. Focused on employee productivity and experience, the Modernization Suite transforms legacy data to allow it use by modern SaaS platforms and transforms legacy business processes into modern end-user business applications.
It provides risk management and regulatory teams with the tools to navigate the complex compliance landscape effectively. ■ The Modernization Suite: Focused on transforming legacy data and processes for modern SaaS platforms. It empowers change management teams to drive digital transformation with AI-ready solutions, enhancing employee engagement and productivity while accelerating the impact of these changes.
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ITEM 1. BUSINESS Company Overview AvePoint provides a cloud-native data management software platform that organizations rely on to manage and protect critical data, optimize IT operations, achieve meaningful cost savings, and efficiently secure the digital workplace.
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ITEM 1. BUSINESS Company Overview AvePoint empowers organizations of all sizes, industries, and regions with its cloud-native data management software platform, enabling them to prepare, secure, and optimize their critical data. The AvePoint Confidence Platform unifies data security, governance, and business continuity into a seamless, resilient experience, addressing the most pressing challenges in today’s complex digital landscape.
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Companies around the world have now fully adopted a hybrid work model, and they are now tasked with delivering a seamless and secure workplace experience for knowledge workers, centered around an extensive portfolio of Software-as-a-Service (“ SaaS ”) solutions and productivity applications.
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In a world where data is sprawling across hybrid work environments and generative artificial intelligence (“ AI ”) technologies are rapidly emerging, AvePoint stands out with its platform-first strategy. By integrating features and solutions to optimize operations, AvePoint delivers more than basic security controls—it redefines how businesses manage their most sensitive data and critical assets.
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The adoption of this portfolio of solutions is a substantial and ongoing challenge for most organizations, which for decades had used only a small number of multi-purpose on-premises applications to drive business outcomes.
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This holistic and automated approach enables organizations to secure the perimeter for sensitive data, strategically govern digital workspaces, and ensure compliance with evolving regulatory requirements.
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However, to deliver an efficient digital workplace today, companies must manage this range of applications – and the associated explosive growth and sprawl of critical data – with a platform offering that is well governed, fit for purpose, easy to use and built on automation.
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Organizations today face a host of challenges that make a robust data management strategy indispensable, including: ■ Optimizing data for AI: As organizations modernize their data ecosystems, the complexities of leveraging generative AI technologies require proper governance, security, and lifecycle management.
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In addition, many organizations are beginning to realize the potential of generative artificial intelligence (“ AI ”) to drive competitive advantage and value creation, including (1) extracting greater value from complex datasets, (2) making more informed business decisions, (3) reducing employee workloads, and (4) improving the overall customer experience.
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With AvePoint, companies can extract more value from complex datasets, make informed decisions, reduce workloads, and enhance customer experiences. ■ Explosive data growth: The hybrid work model and software-as-a-service (“ SaaS ”) proliferation have led to a surge in unstructured, sensitive data.
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While these data-driven improvements are expected to lead to stronger revenue growth and operational efficiency, successfully leveraging this new technology is in turn dependent on first addressing data management challenges that all organizations face.
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AvePoint’s solutions tackle the sprawl with robust control and protection measures to manage this growth. ■ A dangerous threat landscape and complex regulations: Companies are navigating increasing cyber threats and global regulatory demands.
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Specifically, for AI-driven projects to succeed, companies must apply robust strategies across the data estate to manage the information lifecycle, properly govern and secure their data, and ensure its compliance.
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AvePoint ensures data is protected, secure, and compliant, helping mitigate financial, operational, and reputational risks. ■ The need for automation: To monitor, govern, and respond to threats efficiently, organizations require streamlined, automated platforms that deliver rapid value. AvePoint’s automation layer integrates seamlessly to achieve this efficiency.
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These are the core business problems that AvePoint has been solving for more than two decades, and why we believe AvePoint is well positioned to be a key enabler of generative AI adoption within enterprises in the coming years.
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Guided by its Beyond Secure philosophy, AvePoint goes beyond traditional boundaries to inspire trust, enabling organizations to focus on innovation while protecting against data breaches and unauthorized access.
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AvePoint’s Confidence Platform empowers organizations – of all sizes, in all regions, and across all industries – to optimize and secure the solutions that most commonly establish and underpin the digital workplace.
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With extensions to existing cloud services and new applications leveraging common underlying SaaS services, the platform provides superior flexibility, and presents a compelling solution for organizations seeking efficient, consolidated solutions amidst budget uncertainty and the demand for faster ROI. With these capabilities, the Confidence Platform allows organizations to move forward confidently, thriving within a sustainable security framework.
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To drive modernization efforts, the platform also provides extensions to the functionality of existing cloud services as well as new applications, all while leveraging the common underlying SaaS services for data, process, user experience and integration.
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It stands out from competitors through three key differentiators: ■ A Complete, Actionable Picture of Your Data Estate: The platform’s Command Centers enable organizations to establish a comprehensive view of pressing business issues and implement scalable, automated remediation, ensuring seamless governance and management of vast amounts of critical information. ■ Shared Accountability: Scalable security requires a culture of responsibility.
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The AvePoint Confidence Platform, and the applications that it powers, is organized into three interconnected suites of functionality—each targeting a core set of business drivers and customer needs. Those suites are: ■ The Control Suite. Focused on the governance and management of the digital workplace, the Control Suite provides a ready-made framework for automated governance and policy enforcement.
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The Confidence Platform empowers data leaders to operationalize digital workspace security, promoting accountability from data owners and streamlining governance across multiple collaboration platforms. ■ Programmatic Protection: The platform employs a tiered data protection strategy to minimize attack surfaces and compliance risks while delivering exceptional data security.
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It empowers modernization and change management teams to drive digital transformation with AI ready solutions across the organization, and to measure and accelerate the impact of this transformation on employee experience and engagement. Built with security and scale in mind, AvePoint’s cloud-native platform is available across 14 global data centers.
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Its integrated approach to data security and governance provides risk management, audit, and regulatory teams with the assurance they need to meet compliance obligations efficiently. The AvePoint Confidence Platform is organized into three interconnected suites, each addressing specific business drivers and customer needs: ■ The Control Suite: Focused on automating data governance and proactively enforcing policies to reduce security risks.
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Our multi-tenant architecture is designed to immediately provide customers the latest enhancements and upgrades, and the platform is ISO 27001:2013, ISO 27017:2015 and ISO 27701:2019 certified, has achieved compliance with HITRUST CSF v11.0.1, and has received systems and organization controls (“ SOC ”) 2 Type II accreditation and FedRAMP (Moderate) Authorization. 5 Table of Contents PART I Item 1 Within each suite are a number of products addressing critical customer needs.
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Built with security and scale in mind, the AvePoint Confidence Platform operates across 14 global data centers, adhering to rigorous industry standards, including ISO certifications, HITRUST CSF, SOC 2 Type II accreditation, and FedRAMP (Moderate) Authorization. This ensures that customers benefit from continuous upgrades, enhanced security, and the ability to meet evolving data management challenges.
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We have built a differentiated platform that enables organizations to integrate modern applications, and our goal is to continually invest in technologies that improve the digital workplace experience.
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As a result, the AvePoint Confidence Platform stands out as a true platform offering, delivering spend consolidation, efficiency gains, and immediate value for customers.
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We leverage the resources of our partner and channel community across customers of all segments. We expect that partner sourced revenue will account for a growing portion of our revenue for the foreseeable future. ■ Partner Marketplaces . Our solutions are available in more than 100 marketplaces around the world through our distribution and marketplace partners.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeIn addition to our remediation efforts described in the previous risk factor under the heading “O ur management has identified material weaknesses in our internal control over financial reporting and we may identify additional material weaknesses in the future or otherwise fail to maintain an effective system of internal controls, which may result in material misstatements of our financial statements or cause us to fail to meet our periodic reporting obligations, ” we may need to undertake various additional costly and time-consuming actions, such as implementing new internal controls and procedures and hiring accounting or internal audit staff, which may adversely affect our business, financial condition and results of operations.
Biggest changeWe aim to comply with and perform the evaluations needed to comply with Section 404 of the Sarbanes-Oxley Act (“ SOX ”). We may need to undertake various additional costly and time-consuming actions, such as implementing new internal controls and procedures and hiring accounting or internal audit staff, which may adversely affect our business, financial condition and results of operations.
Acquisitions may also disrupt our business, divert our resources and require significant management attention that would otherwise be available for development of our existing business. The anticipated benefits of any acquisition, investment, or business relationship may not be realized or we may be exposed to unknown risks or liabilities.
Acquisitions may also disrupt our business, divert our resources and require significant management attention that would otherwise be available for the development of our existing business. The anticipated benefits of any acquisition, investment, or business relationship may not be realized or we may be exposed to unknown risks or liabilities.
Our international operations will involve a variety of risks, including: ■ Changes in a country’s or region’s political or economic conditions; ■ Economic uncertainty around the world and adverse effects arising from economic interdependencies across countries and regions; ■ The need to adapt and localize products and services for specific countries; ■ Greater difficulty in receiving payments from different geographies, including difficulties associated with currency fluctuations, transfer of funds, longer payment cycles and collecting accounts receivable, especially in emerging markets; 27 Table of Contents P ART I Item 1A ■ Potential changes in trade relations arising from policy initiatives implemented by the current administration or by a successor administration; ■ Compliance with foreign laws and regulations and the risks and costs of non-compliance with such laws and regulations; ■ Unexpected changes in laws, regulatory requirements, taxes, or trade laws; ■ More stringent regulations relating to privacy and data security and the unauthorized use of, or access to, commercial and personal information, particularly in Europe; ■ Differing labor regulations, especially in Europe, where labor laws are generally more advantageous to employees as compared to the United States, including deemed hourly wage and overtime regulations in these locations; ■ Challenges inherent in efficiently managing an increased number of employees over large geographic distances (including in a work-from-home environment), including the need to implement appropriate systems, policies, benefits, and compliance programs; ■ Difficulties in managing a business in new markets with diverse cultures, languages, customs, legal systems, alternative dispute systems, and regulatory systems; ■ Increased travel, real estate, infrastructure, and legal compliance costs associated with international operations; ■ Currency exchange rate fluctuations and the resulting effect on revenue and expenses, and the cost and risk of entering into hedging transactions if we elect to do so in the future; ■ Limitations on the ability to reinvest earnings from operations in one country to fund the capital needs of our operations in other countries; ■ Laws and business practices favoring local competitors or general preferences for local vendors; ■ limited or insufficient intellectual property protection or difficulties enforcing our intellectual property; ■ Political instability or terrorist activities; ■ Exposure to liabilities under anti-corruption and anti-money laundering laws, including the U.S.
Our international operations will involve a variety of risks, including: ■ Changes in a country’s or region’s political or economic conditions; ■ Economic uncertainty around the world and adverse effects arising from economic interdependencies across countries and regions; ■ The need to adapt and localize products and services for specific countries; ■ Greater difficulty in receiving payments from different geographies, including difficulties associated with currency fluctuations, transfer of funds, longer payment cycles and collecting accounts receivable, especially in emerging markets; 25 Table of Contents P ART I Item 1A ■ Potential changes in trade relations arising from policy initiatives implemented by the current administration or by a successor administration; ■ Compliance with foreign laws and regulations and the risks and costs of non-compliance with such laws and regulations; ■ Unexpected changes in laws, regulatory requirements, taxes, or trade laws; ■ More stringent regulations relating to privacy and data security and the unauthorized use of, or access to, commercial and personal information, particularly in Europe; ■ Differing labor regulations, especially in Europe, where labor laws are generally more advantageous to employees as compared to the United States, including deemed hourly wage and overtime regulations in these locations; ■ Challenges inherent in efficiently managing an increased number of employees over large geographic distances (including in a work-from-home environment), including the need to implement appropriate systems, policies, benefits, and compliance programs; ■ Difficulties in managing a business in new markets with diverse cultures, languages, customs, legal systems, alternative dispute systems, and regulatory systems; ■ Increased travel, real estate, infrastructure, and legal compliance costs associated with international operations; ■ Currency exchange rate fluctuations and the resulting effect on revenue and expenses, and the cost and risk of entering into hedging transactions if we elect to do so in the future; ■ Limitations on the ability to reinvest earnings from operations in one country to fund the capital needs of our operations in other countries; ■ Laws and business practices favoring local competitors or general preferences for local vendors; ■ limited or insufficient intellectual property protection or difficulties enforcing our intellectual property; ■ Political instability or terrorist activities; ■ Exposure to liabilities under anti-corruption and anti-money laundering laws, including the U.S.
Our success with SMB customers depends in part on our resale and distribution partnerships. Our business would be harmed if we fail to maintain or expand partner relationships. We leverage the sales and referral resources of resale and referral partners through a variety of programs, and we also rely on distribution partners, especially for our SMB market acquisition.
Our success with SMB customers depends in part on our resale and distribution partnerships. Our business would be harmed if we fail to maintain or expand partner relationships. We leverage the sales and referral resources of resale and referral partners through a variety of programs, and we also rely on distribution partners, especially for our SMB market customer acquisition.
Microsoft and other cloud providers may also choose to make it difficult for third party providers like us to continue making the necessary application programming interface (“ API ”) calls to provide their solutions, as illustrated by an increase in API “throttling” in recent years or API quotas provided by Salesforce. 21 Table of Contents P ART I Item 1A Although we typically receive significant advance notice of new product releases from Microsoft, Microsoft does not always preview their technology with us or other partners and, as a result, it is possible that we may not receive advance notice of changes in features and functionality of new technologies with which our products will need to interoperate.
Microsoft and other cloud providers may also choose to make it difficult for third party providers like us to continue making the necessary application programming interface (“ API ”) calls to provide their solutions, as illustrated by an increase in API “throttling” in recent years or API quotas provided by Salesforce. 19 Table of Contents P ART I Item 1A Although we typically receive significant advance notice of new product releases from Microsoft, Microsoft does not always preview their technology with us or other partners and, as a result, it is possible that we may not receive advance notice of changes in features and functionality of new technologies with which our products will need to interoperate.
All of the legal entities (and each of their respective employees) within our global corporate structure are contractually bound to the ISMS, but failure by any of our subsidiaries or affiliates (or employees thereof) to abide by the terms and conditions imposed by our ISMS could result in increased vulnerabilities, decreased integrity of our assets, and ultimately, liability, loss of business, and loss of customer confidence. 30 Table of Contents P ART I Item 1A The ISMS applies to the use of information, network resources, and electronic and computing devices to conduct business or interact with internal networks and business systems, whether owned or leased by us, our employees, or a third party.
All of the legal entities (and each of their respective employees) within our global corporate structure are contractually bound to the ISMS, but failure by any of our subsidiaries or affiliates (or employees thereof) to abide by the terms and conditions imposed by our ISMS could result in increased vulnerabilities, decreased integrity of our assets, and ultimately, liability, loss of business, and loss of customer confidence. 28 Table of Contents P ART I Item 1A The ISMS applies to the use of information, network resources, and electronic and computing devices to conduct business or interact with internal networks and business systems, whether owned or leased by us, our employees, or a third party.
We cannot guarantee that it will be able to anticipate future market needs and opportunities, extend our technological expertise and develop new products or expand the functionality of our current products in a timely and cost-effective manner, or at all.
We cannot guarantee that we will be able to anticipate future market needs and opportunities, extend our technological expertise and develop new products or expand the functionality of our current products in a timely and cost-effective manner, or at all.
We plan to continue expanding our sales force and strategic partners, both domestically and internationally. We also have dedicated, and plans to further dedicate, significant resources to sales and marketing programs, including search engine and other online advertising.
We plan to continue expanding our sales force and strategic partners, both domestically and internationally. We also have dedicated, and have plans to further dedicate, significant resources to sales and marketing programs, including search engine optimization and other online advertising.
If we incur such losses or liabilities, we might be unable to recover significant amounts from our third-party providers (even if they were primarily or solely responsible) because of restrictive liability and indemnification terms. 25 Table of Contents P ART I Item 1A If there are interruptions or performance problems associated with our technology or infrastructure, our existing customers may experience service outages, and our new customers may experience delays in using our products and services.
If we incur such losses or liabilities, we might be unable to recover significant amounts from our third-party providers (even if they were primarily or solely responsible) because of restrictive liability and indemnification terms. 23 Table of Contents P ART I Item 1A If there are interruptions or performance problems associated with our technology or infrastructure, our existing customers may experience service outages, and our new customers may experience delays in using our products and services.
Any of these occurrences could result in loss of customers, lost or delayed market acceptance and sales of our products and services, delays in payment by customers, injury to our reputation and brand, legal claims, including warranty and service claims, diversion of resources, including through increased service and warranty expenses or financial concessions, and increased insurance costs. 29 Table of Contents P ART I Item 1A We may discover defects in our products and services that could result in data unavailability, unauthorized access, loss, corruption, or other harm to our customers’ data.
Any of these occurrences could result in loss of customers, lost or delayed market acceptance and sales of our products and services, delays in payment by customers, injury to our reputation and brand, legal claims, including warranty and service claims, diversion of resources, including through increased service and warranty expenses or financial concessions, and increased insurance costs. 27 Table of Contents P ART I Item 1A We may discover defects in our products and services that could result in data unavailability, unauthorized access, loss, corruption, or other harm to our customers’ data.
In addition, failures to meet our customers’ expectations with respect to security and confidentiality of their data and information could damage our reputation and affect our ability to retain customers, attract new customers, and grow our business. 31 Table of Contents P ART I Item 1A Our potential failure to comply with legal or contractual requirements around the security of personal information could lead to significant fines and penalties, as well as claims by customers, affected data subjects, or other stakeholders.
In addition, failures to meet our customers’ expectations with respect to security and confidentiality of their data and information could damage our reputation and affect our ability to retain customers, attract new customers, and grow our business. 29 Table of Contents P ART I Item 1A Our potential failure to comply with legal or contractual requirements around the security of personal information could lead to significant fines and penalties, as well as claims by customers, affected data subjects, or other stakeholders.
Such breaches and attacks on our counterparts within the industry and within our market may cause, among other things, interruptions to the provision of service, degradation of the user experience, the loss of user confidence and trust in our products, or result in financial harm to us. 32 Table of Contents P ART I Item 1A Risks Related to Intellectual Property We will rely on third-party proprietary and open source software for our products and services.
Such breaches and attacks on our counterparts within the industry and within our market may cause, among other things, interruptions to the provision of service, degradation of the user experience, the loss of user confidence and trust in our products, or result in financial harm to us. 30 Table of Contents P ART I Item 1A Risks Related to Intellectual Property We will rely on third-party proprietary and open source software for our products and services.
If the economic conditions of the general economy or markets in which we operate worsen from present levels, our business, results of operations and financial condition could be harmed. 24 Table of Contents P ART I Item 1A Failure to effectively develop and expand our marketing and sales capabilities could harm our ability to increase our customer base and achieve broader market acceptance of our products and services.
If the economic conditions of the general economy or markets in which we operate worsen from present levels, our business, results of operations and financial condition could be harmed. 22 Table of Contents P ART I Item 1A Failure to effectively develop and expand our marketing and sales capabilities could harm our ability to increase our customer base and achieve broader market acceptance of our products and services.
If we fail to maintain or grow our brand recognition, our ability to expand our customer base will be impaired and our financial condition may suffer. 26 Table of Contents P ART I Item 1A We believe enhancing the AvePoint brand and maintaining our reputation in the information technology industry will be critical for the continued acceptance of our existing and future products and services, attracting new customers to our products and services, and retaining existing customers.
If we fail to maintain or grow our brand recognition, our ability to expand our customer base will be impaired and our financial condition may suffer. 24 Table of Contents P ART I Item 1A We believe enhancing the AvePoint brand and maintaining our reputation in the information technology industry will be critical for the continued acceptance of our existing and future products and services, attracting new customers to our products and services, and retaining existing customers.
The existence of any material weakness in our internal control over financial reporting could also result in errors in our financial statements that could require us to restate our financial statements, cause us to fail to meet our reporting obligations and cause shareholders to lose confidence in our reported financial information, all of which could materially and adversely affect our business and stock price. 35 Table of Contents PART I Items 1B and 1C ITEM 1B.
The existence of any material weakness in our internal control over financial reporting could also result in errors in our financial statements that could require us to restate our financial statements, cause us to fail to meet our reporting obligations and cause shareholders to lose confidence in our reported financial information, all of which could materially and adversely affect our business and stock price. 32 Table of Contents PART I Items 1B and 1C ITEM 1B.
This development effort may require significant engineering, marketing and sales resources, all of which would affect our business and operating results. 23 Table of Contents P ART I Item 1A Any failure of our products and services to operate effectively with future technologies could reduce the demand for our products and services.
This development effort may require significant engineering, marketing and sales resources, all of which would affect our business and operating results. 21 Table of Contents P ART I Item 1A Any failure of our products and services to operate effectively with future technologies could reduce the demand for our products and services.
If we invest substantial time and resources to expand our international operations and is unable to do so successfully, our business and operating results will suffer. 28 Table of Contents P ART I Item 1A We are exposed to fluctuations in currency exchange rates, which could negatively our revenue and earnings.
If we invest substantial time and resources to expand our international operations and is unable to do so successfully, our business and operating results will suffer. 26 Table of Contents P ART I Item 1A We are exposed to fluctuations in currency exchange rates, which could negatively our revenue and earnings.
Our contracts with our partners generally allow us to terminate our agreements for any reason. The loss of a substantial number of our partners, the possible inability to replace them, the failure to recruit additional partners or the removal of our products and services from several major distribution partner’s resale platforms could harm our results of operations.
Our contracts with our partners generally allow us to terminate our agreements for any reason. The loss of a substantial number of our partners, the possible inability to replace them, the failure to recruit additional partners or the removal of our products and services from several major distribution partners’ resale platforms could harm our results of operations.
Our future success also depends, in part, on our ability to sell additional products, more functionality and/or adjacent services to our current customers, and the success rate of such endeavors is difficult to predict, especially with regard to any new products or lines of business that we may introduce from time to time.
Our future success also depends, in part, on our ability to sell additional products, more functionality and/or adjacent services to our current customers, and the success rate of such endeavors is difficult to predict, especially with regard to any new products or lines of business that we may introduce.
We expect that sales to partners will account for a substantial portion of our revenue for the foreseeable future. Our ability to achieve revenue growth and expand our SMB acquisition in the future will depend in part on our success in maintaining successful relationships with our partners.
We expect that sales to partners will account for a substantial portion of our revenue for the foreseeable future. Our ability to achieve revenue growth and expand our SMB customer acquisition in the future will depend in part on maintaining successful relationships with our partners.
In addition, certain of our customer or resellers may operate in, or have dealings with, countries subject to sanctions or embargos imposed by the U.S. government, foreign governments, or the United Nations or other international organizations.
In addition, certain of our customers or resellers may operate in, or have dealings with, countries subject to sanctions or embargos imposed by the U.S. government, foreign governments, or the United Nations or other international organizations.
Our success will depend in part on the interoperability of our products and services with third-party operating systems, applications, data, web browsers and devices that hawse have not developed and does not control. Due to the continuing rapid growth of the use of mobile devices in business operations, this also includes third-party mobile devices and mobile operating systems.
Our success will depend in part on the interoperability of our products and services with third-party operating systems, applications, data, web browsers and devices that we have not developed and do not control. Due to the continuing rapid growth of the use of mobile devices in business operations, this also includes third-party mobile devices and mobile operating systems.
Further, acquisitions of our customers may lead to the cancellation of our contracts with such customers or by the acquiring companies, thereby reducing the number of our existing and potential customers. If we fail to adapt and respond effectively to rapidly changing technology, evolving industry standards, and changing customer needs or preferences, our products and services may become less competitive.
Further, acquisitions of our customers may lead to the cancellation of the existing contracts by the acquirors, thereby reducing the number of our existing and potential customers. If we fail to adapt and respond effectively to rapidly changing technology, evolving industry standards, and changing customer needs or preferences, our products and services may become less competitive.
Risks Related to Our Operations and Financial Condition Our operations will continue to increase in complexity as we grow, which will create management challenges. Our business has experienced strong growth and is complex. This growth is expected to continue, and our operations will be increasingly complex.
Risks Related to Our Operations and Financial Condition Our operations will continue to increase in complexity as we grow, which will create management challenges. Our business has experienced strong growth and is complex. This growth is expected to continue, and as a result, our operations will become increasingly complex.
Our success in adding new customers depends on numerous factors, including our ability to: (1) offer compelling products and services, (2) execute our sales and marketing strategy, (3) attract, effectively train and retain new sales, marketing, professional services, and support personnel in the markets we pursue, (4) develop or expand relationships with partners, IT consultants, systems integrators resellers and other third parties, strengthening our network, (5) expand into new geographies, including internationally, and market segments, (6) efficiently onboard new customers on to our product offerings, and (7) provide additional paid services that fulfill the needs and complement the capabilities of our customers and their partners.
Our success in adding new customers depends on numerous factors, including our ability to: (1) offer compelling products and services, (2) execute our sales and marketing strategy, (3) attract, effectively train and retain new sales, marketing, professional services, and support personnel in the markets we pursue, (4) develop or expand relationships with partners, including managed service providers, value added resellers, systems integrators, IT consultants, and other third parties, (5) expand into new geographies and market segments, (6) efficiently onboard and support new customers, and (7) provide additional paid services that fulfill the needs and complement the capabilities of our customers and their partners.
We believe our revenue growth and our ability to manage such growth depend on several factors, including, but not limited to, our ability to do the following: ■ Effectively recruit, integrate, train and motivate a large number of new employees, including our sales force, technical solutions professionals, customer success managers and engineers, while retaining existing employees, maintaining the beneficial aspects of our corporate culture and effectively executing our business plan; ■ Attract new customers and retain and increase sales to existing customers; ■ Maintain and expand our relationships with our partners, including effectively managing existing channel partnerships and cultivating new ones; ■ Successfully implement our products and services, increase our existing customers’ use of our products and services, and provide our customers with excellent customer support and the ability of our partners to do the same; ■ Develop our existing products and services and introduce new products or new functionality to our products and services; ■ Expand into new market segments and internationally; ■ Earn revenue share and customer referrals from our partner ecosystem; ■ Improve our key business applications and processes to support our business needs; ■ Enhance our internal controls to ensure timely and accurate reporting of all of our operations and financial results; ■ Protect and further develop our strategic assets, including our intellectual property rights; and ■ Make sound business decisions considering the scrutiny associated with operating as a public company.
We believe our revenue growth and our ability to manage such growth depend on several factors, including, but not limited to, our ability to do the following: ■ Effectively recruit, integrate, train and motivate a large number of new employees, including our sales force, technical solutions professionals, customer success managers and engineers, while retaining existing employees, maintaining the beneficial aspects of our corporate culture and effectively executing our business plan; ■ Attract new customers and retain and increase sales to existing customers; ■ Maintain and expand our relationships with our partners, including effectively managing existing channel partnerships and cultivating new ones; ■ Successfully implement our products and services, increase our existing customers’ use of our products and services, and provide our customers with excellent customer support and the ability of our partners to do the same; ■ Regularly introduce new products and services or new enhancements and functionality to our existing products and services; ■ Expand into new market segments and regions; ■ Earn revenue share and customer referrals from our partner ecosystem; ■ Routinely improve the key software applications and business processes which support our operations; ■ Enhance our internal controls to ensure timely and accurate reporting of all of our operations and financial results; and ■ Protect and further develop our strategic assets, including our intellectual property rights.
Additionally, the existence of any material weakness, including our existing material weaknesses identified by management previously, or any significant deficiency requires management to devote significant time and incur significant expense to remediate any such material weaknesses or significant deficiencies and management may not be able to remediate any such material weaknesses or significant deficiencies in a timely manner.
Additionally, the existence of any material weakness, or any significant deficiency requires management to devote significant time and incur significant expense to remediate any such material weaknesses or significant deficiencies and management may not be able to remediate any such material weaknesses or significant deficiencies in a timely manner.
Our customers’ renewal rates may decline or fluctuate as a result of a number of factors, including their level of satisfaction with our pricing or our products and their ability to continue their operations and spending levels, mix of customer base, decreases in the number of users at our customers, competition, pricing increases or changes, and deteriorating general economic conditions, including as a result of the ongoing military conflicts where the outcome is not possible to predict.
Our customers’ renewal rates may decline or fluctuate as a result of a number of factors, including their level of satisfaction with our pricing or our products, their ability to continue their operations and spending levels, mix of customer base, decreases in the number of users at our customers, competition, pricing increases or changes, and deteriorating general economic conditions.
Negative conditions in the global economy or individual markets, including changes in gross domestic product growth, financial and credit market fluctuations, political turmoil, natural catastrophes, warfare and terrorist attacks on the United States, Europe, Australia, the Asia Pacific region or elsewhere, could cause a decrease in business investments, including spending on IT and negatively affect our business.
Negative conditions in the global economy or individual markets, including changes in gross domestic product growth, financial and credit market fluctuations, political turmoil, natural catastrophes, warfare and terrorist attacks could cause a decrease in business investments, including spending on IT and negatively affect our business.
Despite precautions taken at the used data centers, spikes in usage volume, a natural disaster, an act of terrorism, vandalism or sabotage, closure of a facility without adequate notice, or other unanticipated problems (such as the military conflict between Russia and Ukraine) could result in lengthy interruptions or performance degradation of our platform.
Despite precautions taken at the used data centers, spikes in usage volume, a natural disaster, an act of terrorism, vandalism or sabotage, closure of a facility without adequate notice, or other unanticipated problems could result in lengthy interruptions or performance degradation of our platform.
Key personnel of the acquired companies may choose not to work for us, their software may not be easily adapted, or we may have difficulty retaining the customers of any acquired business due to changes in ownership, management, or otherwise. We may also experience difficulties integrating personnel of the acquired company into our business and culture.
Key personnel of the acquired companies may choose not to work for us, their software may not be easily adapted, or we may have difficulty retaining the customers of any acquired business due to changes in ownership, management, or otherwise.
Any damage to, or failure of, the systems of our third-party providers could result in interruptions to our products and services. Even with current and planned disaster recovery arrangements, our business could be harmed. If we experience damage or interruption, our insurance policies may not adequately compensate us for any losses that we may incur.
Even with current and planned disaster recovery arrangements, our business could be harmed. If we experience damage or interruption, our insurance policies may not adequately compensate us for any losses that we may incur.
If we are unable to assert that our internal control over financial reporting is effective and our independent registered public accounting firm is unable to attest to management’s assessment of the effectiveness of our internal control over financial reporting, we could lose investor confidence in the accuracy and completeness of our financial reports, which would cause the price of our common stock to decline, and we may be subject to investigation or sanctions by the SEC. 34 Table of Contents P ART I Item 1A We are required, pursuant to Section 404 of SOX, to furnish a report by management on, among other things, the effectiveness of our internal control over financial reporting as of December 31, 2023.
If we are unable to assert that our internal control over financial reporting is effective and our independent registered public accounting firm is unable to attest to management’s assessment of the effectiveness of our internal control over financial reporting, we could lose investor confidence in the accuracy and completeness of our financial reports, which would cause the price of our common stock to decline, and we may be subject to investigation or sanctions by the SEC.
Our customers may renew for fewer elements of our products, for shorter renewal terms or on different pricing terms, including lower-cost offerings of our products.
In addition, our customers may renew their contracts but for a lower number of AvePoint products, for shorter renewal periods, or on different pricing terms, including lower-cost offerings of our products.
We may not accomplish any of these objectives and, as a result, it is difficult for us to forecast our future revenue or revenue growth.
We may not accomplish any of these objectives and, as a result, it is difficult for us to forecast our future revenue or revenue growth. If our assumptions are incorrect or change in reaction to changes in our market, we may not be able to maintain similar growth rates in the future.
We store confidential company information and sensitive data, including personal information of our customers and employees, which may in turn contain third-party personal or other confidential information. If the security of this information is compromised or is otherwise accessed without authorization, our reputation may be harmed, and we may be exposed to liability and loss of business.
If the security of this information is compromised or is otherwise accessed without authorization, our reputation may be harmed, and we may be exposed to liability and loss of business.
Moreover, if we do not effectively manage the growth of our business and operations, the quality of our software could suffer, which could negatively affect the AvePoint brand, results of operations and overall business. 22 Table of Contents P ART I Item 1A Our future revenue and operating results will be harmed if we are unable to acquire new customers, expand sales to our existing customers, or develop new functionality for our products and services that achieves market acceptance.
Our future revenue and operating results will be harmed if we are unable to acquire new customers, expand sales to our existing customers, or develop new functionality for our products and services that achieves market acceptance. 20 Table of Contents P ART I Item 1A To continue to grow our business, it is important that we continue to acquire new customers to purchase and use our products and services.
While no single company can thwart a nation state attack, we work to implement and continuously improve security-aware software development, operational management, and threat-mitigation practices that are essential to the strong protection of services and data. AvePoint has decades-long experience building enterprise software and running online services around the world.
The growth in state sponsored cyber activity showcases the increasing sophistication of cyber threats and could dramatically expand the global threat landscape. While no single company can thwart a nation state attack, we work to implement and continuously improve security-aware software development, operational management, and threat-mitigation practices that are essential to the strong protection of services and data.
Our own and third party data centers may also be subject to national or local administrative actions, changes in government regulations, including, for example, the impact of global economic and other sanctions like those levied in response to the Russia-Ukraine crisis, changes to legal or permitting requirements and litigation to stop, limit or delay operations.
Our own and third party data centers may also be subject to national or local administrative actions, changes in government regulations, including changes to legal or permitting requirements and litigation to stop, limit or delay operations. Any damage to, or failure of, the systems of our third-party providers could result in interruptions to our products and services.
Although we have generally taken measures to protect our proprietary rights, there can be no assurance that others will not offer products or concepts that are substantially similar to ours and compete with our business. 33 Table of Contents P ART I Item 1A Risks Related to Financial Reporting Our management has identified material weaknesses in our internal control over financial reporting and we may identify additional material weaknesses in the future or otherwise fail to maintain an effective system of internal controls, which may result in material misstatements of our financial statements or cause us to fail to meet our periodic reporting obligations.
Although we have generally taken measures to protect our proprietary rights, there can be no assurance that others will not offer products or concepts that are substantially similar to ours and compete with our business. 31 Table of Contents P ART I Item 1A Risks Related to Financial Reporting As a public company, we are obligated to develop and maintain proper and effective internal control over financial reporting in order to comply with Section 404 of the Sarbanes-Oxley Act.
Additionally, we rely heavily on our early access to preview Microsoft technology, which enables our product strategy and development teams to anticipate future opportunities as well as validate our current direction. While Microsoft introduces competitive features as a premium option, some customers will choose a simpler first-party solution to their problem, even at a greater cost to them.
Additionally, we rely heavily on our early access to preview Microsoft technology, which enables our product strategy and development teams to anticipate future opportunities as well as validate our current direction.
Furthermore, these activities will require significant investments and allocation of valuable management and employee resources, and our growth will continue to place significant demands on our management and our operational and financial infrastructure. There are no guarantees we will be able to grow our business in an efficient or timely manner, or at all.
You should not rely on our revenue from any prior periods as any indication of our future revenue or revenue growth. Furthermore, these activities will require significant investments and allocation of valuable management and employee resources, and our growth will continue to place significant demands on our management and our operational and financial infrastructure.
These risks, as well as the number and frequency of cybersecurity events globally, may also be heightened during times of geopolitical tension or instability between countries, including, for example, the ongoing military conflict between Russia and Ukraine, from which a number of recent cybersecurity events have been alleged to have originated.
These risks, as well as the number and frequency of cybersecurity events globally, may also be heightened during times of geopolitical tension or instability between countries. We store confidential company information and sensitive data, including personal information of our customers and employees, which may in turn contain third-party personal or other confidential information.
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If our assumptions are incorrect or change in reaction to changes in our market, or if we are unable to maintain consistent revenue or revenue growth, we may not be able to maintain similar growth rates in the future. You should not rely on our revenue for any prior periods as any indication of our future revenue or revenue growth.
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In situations where Microsoft introduces competitive features to our products, including a Microsoft premium option, some customers will choose a simpler first-party solution to their problem, even at a greater cost to them.
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To continue to grow our business, it is important that we continue to acquire new customers to purchase and use our products and services.
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There are no guarantees we will be able to grow our business in an efficient or timely manner, or at all. Moreover, if we do not effectively manage the growth of our business and operations, the quality of our software could suffer, which could negatively affect the AvePoint brand, results of operations and overall business.
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In addition, as an increasing amount of our business may move to our cloud-based products and services and the use of consumption-based pricing models may represent a greater share of our revenue, our revenue may be less predictable or more variable than our historical revenue from perpetual or time period-based subscription pricing models.
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In addition, while the majority of our offerings are currently licensed based on customer headcount, the use of consumption-based pricing models may increase in the future, and our revenue may be more difficult to predict.
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The growth in state sponsored cyber activity, including the increased rate of cyberattacks arising from the Russia-Ukraine crisis and the risk that these cyberattacks could spread globally, showcases the increasing sophistication of cyber threats and could dramatically expand the global threat landscape.
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AvePoint has experience spanning multiple decades of building enterprise software and running online services around the world.
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We are a public company, and our management is required to maintain internal control over financial reporting and to report any material weaknesses in such internal control. Prior to the consummation of the Apex Business Combination, we were a private company with limited accounting and financial reporting personnel and other resources with which to address our internal controls and procedures.
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We are required, pursuant to Section 404 of SOX, to furnish a report by management on, among other things, the effectiveness of our internal control over financial reporting as of December 31, 2024.
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A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.
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We determined that we had material weaknesses in the design and implementation of control activities to address the completeness and accuracy of certain information relevant for control owners to perform their control activities over financial accounting, reporting and disclosures.
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With the oversight of senior management and our audit committee, we implemented actions under a remediation plan which include (A) enhancement of the design of controls that address the completeness and accuracy of reports being utilized in the execution of internal controls and (B) continuous evaluation of the assignment of responsibilities associated with the performance of control activities and consider hiring additional resources, obtaining third party assistance, and providing additional training to existing resources.
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We have continued the implementation of this plan and believe the measures described above will remediate the material weaknesses identified and strengthen our internal control over financial reporting. We are committed to continuing to improve our internal control processes and will continue to diligently and vigorously review our financial reporting controls and procedures.
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While we continue to implement our plan to remediate the material weaknesses described above, we cannot predict the success of such plan or the outcome of our assessment of these plans at this time.
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If our steps are insufficient to remediate the material weaknesses successfully and otherwise establish and maintain an effective system of internal control over financial reporting, the reliability of our financial reporting, investor confidence in us, and the value of our common stock could be materially and adversely affected.
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We can give no assurance that the implementation of this plan will remediate these deficiencies in internal control or that additional material weaknesses or significant deficiencies in our internal control over financial reporting will not be identified in the future.
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Our failure to implement and maintain effective internal control over financial reporting could result in errors in our financial statements that could result in a restatement of our financial statements, causing us to fail to meet our reporting obligations.
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As a public company, we are obligated to develop and maintain proper and effective internal control over financial reporting in order to comply with Section 404 of the Sarbanes-Oxley Act.
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We aim to comply with and perform the evaluations needed to comply with Section 404 of the Sarbanes-Oxley Act (“ SOX ”).

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeAn expert in cyber and data security trends, our CISO has over twenty years of experience in the data protection field, was a founding member of the Women Leading Privacy Advisory Board and former member of the Education Advisory Board for the International Association of Privacy Professionals (IAPP) and in 2023, was named a finalist for the Women in IT Awards in the Security Leader of the Year category, included in the SIA Women in Security Power Forum 100 and named a Top Global CISO by Cyber Defense Magazine.
Biggest changeAn expert in cyber and data security trends, our CISO has over twenty years of experience in the data protection field, was a founding member of the Women Leading Privacy Advisory Board and former member of the Education Advisory Board for the International Association of Privacy Professionals (IAPP) and has been a finalist for the Women in IT Awards in the Security Leader of the Year category, included in the SIA Women in Security Power Forum 100, featured in Forbes, and named a Top Global CISO by Cyber Defense Magazine. including being featured in the "CSO Hall of Fame".
Disclosure of the Board ’ s Roles and Responsibilities Our Board of Directors oversees risks from cybersecurity threats using a multi-faceted approach that involves the Nominating and Corporate Governance Committee and various executive roles. Additionally, our CISO and Chief Compliance Officer regularly report on cybersecurity matters to the Board, as discussed above.
Disclosure of the Board ’ s Roles and Responsibilities Our Board oversees risks from cybersecurity threats using a multi-faceted approach that involves the Nominating and Corporate Governance Committee and various executive roles. Additionally, our CISO and Chief Compliance Officer regularly report on cybersecurity matters to the Board, as discussed above.
However, despite our efforts, we cannot eliminate all risks from cybersecurity threats, or provide assurances that we have not experienced undetected cybersecurity incidents. For additional information about these risks, see Part I, Item 1A, “Risk Factors” in this Annual Report on Form 10-K. 38 Table of Contents PART I Items 2, 3, and 4
However, despite our efforts, we cannot eliminate all risks from cybersecurity threats, or provide assurances that we have not experienced undetected cybersecurity incidents. For additional information about these risks, see Part I, Item 1A, “Risk Factors” in this Annual Report on Form 10 -K. 35 Table of Contents PART I Items 2, 3, and 4
Our Nominating and Corporate Governance Committee seeks these updates to facilitate proactive governance and to address emerging cybersecurity issues with management. In 2023, we did not identify any privacy or cybersecurity threats that materially affected or are reasonably likely to materially affect our business strategy, results of operations, or financial condition.
Our Nominating and Corporate Governance Committee seeks these updates to facilitate proactive governance and to address emerging cybersecurity issues with management. In 2024, we did not identify any privacy or cybersecurity threats that materially affected or are reasonably likely to materially affect our business strategy, results of operations, or financial condition.
Our risk mitigation strategies include a broad variety of technical and operational measures, as well as annual cybersecurity and privacy training for all of our employees. In addition, we maintain specific policies and practices governing our third-party security risks, including our third-party assessment (“ TPA ”) process.
Our risk mitigation strategies include a broad variety of technical and operational measures, as well as annual cybersecurity and privacy training for all of our employees. In addition, we maintain specific policies and practices governing our third -party security risks, including our third -party risk assessment (“ TPRA ”) process.
Successfully achieving these four certifications demonstrates our prioritization of security and privacy for both us and our customers and we believe shows that we have proper company-wide processes for managing operations, and maintaining people and information assets, information systems, and the associated processes that enable corporate operations.
Successfully achieving these three certifications demonstrates our prioritization of security and privacy for both us and our customers, and we believe shows that we have proper company-wide processes for managing operations, and maintaining people and information assets, information systems, and the associated processes that enable corporate operations.
Under our TPA process, we gather information from certain third parties who contract with AvePoint and share or receive data, or have access to or integrate with our systems, in order to help us assess potential risks associated with their security controls.
Under our TPRA process, we gather information from certain third parties who contract with AvePoint and share or receive data, or have access to or integrate with our systems, in order to help us assess potential risks associated with their security controls.
Our four ISO certifications add to the company’s overall resiliency strategy and commitment to security for all customers, which includes other accreditations including SOC 2 Type II, compliance with HITRUST CSF v11.0.1., CSA STAR, IRAP, FedRAMP and StateRAMP. 36 Table of Contents PART I Item 1C Our privacy and security program dictates a governance structure whereby we: ● Regularly engage senior management on data privacy and security issues; ● Align policies, procedures, and technical controls to demonstrate our process and our commitment to our customers and users; ● Train each of our employees on all privacy and security expectations; ● Conduct regular phishing email simulations for employees and contractors with access to corporate email systems to enhance awareness and responsiveness to such possible threats; ● Maintain a robust cybersecurity incident response plan, which provides a framework for handling cybersecurity incidents based on, among other factors, the potential severity of the incident and facilitates cross-functional coordination across AvePoint; ● Periodically run tabletop exercises to simulate a response to a cybersecurity incident and use the findings to improve our processes and technologies; ● Maintain cybersecurity insurance and regularly review our policy and levels of coverage based on current risks; ● Monitor emerging data protection and cybersecurity laws, and implement changes to our processes, systems and offerings designed to comply, and through policy, practice and contract (as applicable) require employees, as well as third parties who provide services on our behalf, to treat customer information and data with care; ● Complete several cyber-specific audits per year; and ● Engage consultants and other third parties in connection with our cybersecurity practices.
Our three ISO certifications add to the company’s overall resiliency strategy and commitment to security for all customers, which includes other accreditations including SOC 2 Type II, compliance with HITRUST CSF v11.0.1., CSA STAR, IRAP and FedRAMP. 33 Table of Contents Our privacy and security program dictates a governance structure whereby we: ● Regularly engage senior management on data privacy and security issues; ● Align policies, procedures, and technical controls to demonstrate our process and our commitment to our customers and users; ● Train each of our employees on all privacy and security expectations; ● Conduct regular phishing email simulations for employees and contractors with access to corporate email systems to enhance awareness and responsiveness to such possible threats; ● Maintain a robust cybersecurity incident response plan, which provides a framework for handling cybersecurity incidents based on, among other factors, the potential severity of the incident and facilitates cross-functional coordination across AvePoint; ● Periodically run tabletop exercises to simulate a response to a cybersecurity incident and use the findings to improve our processes and technologies; ● Maintain cybersecurity insurance and regularly review our policy and levels of coverage based on current risks; ● Monitor emerging data protection and cybersecurity laws, and implement changes to our processes, systems and offerings designed to comply, and through policy, practice and contract (as applicable) require employees, as well as third parties who provide services on our behalf, to treat customer information and data with care; ● Complete several cyber-specific audits per year; and ● Engage consultants and other third parties in connection with our cybersecurity practices.
We also generally require third parties to maintain security controls to protect our confidential information and data, and notify us of material data breaches that may impact our data. 37 Table of Contents PART I Item 1C Our Chief Risk, Privacy and Information Security Officer (“ CISO ”) leads the company’s privacy, data protection and security program.
We also generally require third parties to maintain security controls to protect our confidential information and data, and to notify us of material data breaches that may impact our data. 34 Table of Contents Our Chief Risk, Privacy and Information Security Officer (“ CISO ”) leads the company’s privacy, data protection and security program.
We have certified against, and demonstrated conformance to, the International Organization for Standardization’s (“ ISO ”) information security management system audit using the 27701:2019 framework for the first time, and the 27001:2013, 27701:2019, and 27017:2015 frameworks.
We have certified against, and demonstrated conformance to, the latest International Organization for Standardization’s (“ISO”) information security management system audit using the 27001:2022, 27701:2019, and 27017:2015 frameworks.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeThe table below shows a summary of the square footage of our office and other facilities owned and leased domestically and internationally as of December 31, 2023: (Square feet in thousands) Location Owned Leased Total U.S. — 49.8 49.8 International 16.4 221.9 238.3 Total 16.4 271.7 288.1 Our Principal Offices Our principal corporate headquarters are located in Jersey City, New Jersey, United States, and consist of approximately 15,467 square feet under a lease that expires in 2030.
Biggest changeThe table below shows a summary of the square footage of our office and other facilities owned and leased domestically and internationally as of December 31, 2024: (Square feet in thousands) Location Owned Leased Total U.S. — 41.5 41.5 International 16.4 188.8 205.2 Total 16.4 230.3 246.7 Our Principal Offices Our principal executive headquarters are located in Jersey City, New Jersey, United States, and consist of approximately 15,467 square feet under a lease that expires in 2030.
Our principal operating offices are located in Richmond, Virginia, United States, where we lease approximately 11,965 square feet under a lease that expires in 2027. Use of Facilities We use our principal corporate headquarters primarily for our executive management, information technology, human resources, and marketing teams, as well as for certain of data privacy and security teams.
Our principal operating offices are located in Richmond, Virginia, United States, where we lease approximately 11,965 square feet under a lease that expires in 2027. Use of Facilities We use our principal executive headquarters primarily for our executive management, information technology, human resources, and marketing teams, as well as for certain of data privacy and security teams.
As of December 31, 2023, we had approximately 271,713 square feet of leased office space across the United States, Australia, China, France, Germany, Japan, Netherlands, the Philippines, Singapore, South Africa, South Korea, Sweden, Switzerland, the United Kingdom, and Vietnam.
As of December 31, 2024, we had 230,282 square feet of leased office space across the United States, Australia, Canada, China, France, Germany, Japan, Netherlands, the Philippines, Singapore, South Africa, South Korea, Sweden, Switzerland, the United Kingdom, Vietnam and Malaysia.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeExcept for such claims that arise in the normal course of business, as of and for the fiscal quarter and the fiscal year ended December 31, 2023, we are not a party to any material asserted, ongoing, threatened, or pending claims, suits, assessments, proceedings, or other litigation.
Biggest changeExcept for such claims that arise in the normal course of business, as of and for the fiscal quarter and the fiscal year ended December 31, 2024, we are not a party to any material asserted, ongoing, threatened, or pending claims, suits, assessments, proceedings, or other litigation.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe following table presents information with respect to common stock shares repurchased under the Share Repurchase Program during the period from October 1, 2023 to December 31, 2023: Period Total number of shares purchased (1) Average price paid per share (2) Total number of shares purchased as part of the Share Repurchase Program Approximate dollar value of shares that may yet be purchased under the Share Repurchase Program (3) October 1, 2023 - October 31, 2023 577,145 $7.0953 577,145 $92,333,439 November 1, 2023 - November 30, 2023 27,306 $7.5507 27,306 $92,127,260 December 1, 2023 - December 31, 2023 130,930 $8.3304 130,930 $91,036,562 (1) All shares reported herein, including shares repurchased to satisfy employee taxes on vesting RSUs, were purchased pursuant to the publicly announced Share Repurchase Program.
Biggest changeThe following table presents information with respect to common stock shares repurchased under the Share Repurchase Program during the period from October 1, 2024 to December 31, 2024: Period Total number of shares purchased (1) Average price paid per share (2) Total number of shares purchased as part of the Share Repurchase Program Approximate dollar value of shares that may yet be purchased under the Share Repurchase Program (3) October 1, 2024 - October 31, 2024 2,641 $11.5426 2,641 $69,301,774 November 1, 2024 - November 30, 2024 15,564 $13.3491 15,564 $69,094,010 December 1, 2024 - December 31, 2024 613,882 $18.0987 613,882 $57,938,519 (1) All shares reported herein, including shares repurchased to satisfy employee taxes on vesting RSUs and Company Earn-out Shares, were purchased pursuant to the publicly announced Share Repurchase Program.
Securities Authorized for Issuance Under Equity Compensation Plans See “ Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters ” (Part III, Item 12 of this Annual Report) and “ Note 15 — Stock-Based Compensation ” (Part II, Item 8 of this Annual Report) for more information. 40 Table of Contents PART II Items 5 and 6 Issuer Purchaser of Equity Securities On March 17, 2022, we announced that our Board authorized a new share repurchase program (the “ Share Repurchase Program ”) for us to buy back shares of our common stock.
Securities Authorized for Issuance Under Equity Compensation Plans See “ Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters ” (Part III, Item 12 of this Annual Report) and “ Note 16 — Stock-Based Compensation ” (Part II, Item 8 of this Annual Report) for more information. 37 Table of Contents PART II Items 5 and 6 Issuer Purchaser of Equity Securities On March 17, 2022, we announced that our Board authorized a new share repurchase program (the “ Share Repurchase Program ”) for us to buy back shares of our common stock.
This figure does not include a substantially greater number of beneficial holders of our common stock and public warrants whose shares (or warrants to purchase shares) are held by banks, brokers, and other financial institutions.
These figures do not include a substantially greater number of beneficial holders of our common stock and public warrants whose shares (or warrants to purchase shares) are held by banks, brokers, and other financial institutions.
Current Stockholder and Common Stock Information On February 29, 2024, there were 184,010,832 shares of common stock issued and outstanding held of record by thirteen holders, and 17,905,000 warrants outstanding held of record by two holders.
Current Stockholder and Common Stock Information On February 26, 2025, there were 201,831,243 shares of common stock issued and outstanding held of record by one hundred sixty-two holders, and 7,219,451 warrants outstanding held of record by two holders.
Added
Company Earn-Out Pursuant to the Apex Business Combination, certain holders of common stock and certain holders of options would be issued additional shares of AvePoint’s common stock, as follows (the “ Company Earn-Out Shares ”): ■ 1,000,000 shares of AvePoint’s common stock, in the aggregate, if at any time from July 1, 2021 through July 1, 2028 (a) AvePoint’s stock price is greater than or equal to $12.50 over any 20 trading days within any 30 trading day period or (b) the Company consummates a subsequent transaction, which results in the stockholders of the Company having the right to exchange their shares for cash, securities or other property having a value equaling or exceeding $12.50 per share; ■ 1,000,000 shares of AvePoint’s common stock, in the aggregate, if at any time from July 1, 2021 through July 1, 2028 (a) AvePoint’s stock price is greater than or equal to $15.00 over any 20 trading days within any 30 trading day period or (b) the Company consummates a subsequent transaction, which results in the stockholders of the Company having the right to exchange their shares for cash, securities or other property having a value equaling or exceeding $15.00 per share; ■ 1,000,000 shares of AvePoint’s common stock, in the aggregate, if at any time from July 1, 2021 through July 1, 2028 (a) AvePoint’s stock price is greater than or equal to $17.50 over any 20 trading days within any 30 trading day period or (b) the Company consummates a subsequent transaction, which results in the stockholders of the Company having the right to exchange their shares for cash, securities or other property having a value equaling or exceeding $17.50 per share.
Added
In December 2024, the required price thresholds were met, leading to the private issuance of 2,964,658 Company Earn-Out Shares, and a payment of $0.6 million to certain holders of common stock and options.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeCost of Revenue, Gross Profit, and Gross Margin Cost of revenue, gross profit, and gross margin during the years ended December 31, 2023 and 2022 were as follows: Year Ended December 31, Change 2023 2022 Amount % (in thousands, except percentages) Cost of revenue: SaaS $ 35,924 $ 27,313 $ 8,611 31.5 % Term license and support 1,946 2,006 (60 ) (3.0 )% Services 38,807 36,037 2,770 7.7 % Maintenance 783 920 (137 ) (14.9 )% Total cost of revenue $ 77,460 $ 66,276 $ 11,184 16.9 % Gross profit 194,365 166,063 28,302 17.0 % Gross margin 71.5 % 71.5 % — — GAAP cost of revenue $ 77,460 $ 66,276 $ 11,184 16.9 % Stock-based compensation expense (3,161 ) (2,640 ) (521 ) 19.7 % Amortization of acquired intangible assets (964 ) (617 ) (347 ) 56.2 % Non-GAAP cost of revenue $ 73,335 $ 63,019 $ 10,316 16.4 % Non-GAAP gross profit 198,490 169,320 29,170 17.2 % Non-GAAP gross margin 73.0 % 72.9 % — — Cost of revenue increased 16.9% to $77.5 million for the year ended December 31, 2023 , driven by a $6.6 million increase in aggregated hosting costs and a $4.1 million increase in personnel costs.
Biggest changeCost of Revenue, Gross Profit, and Gross Margin Cost of revenue, gross profit, and gross margin during the years ended December 31, 2024 and 2023 were as follows: Year Ended December 31, Change 2024 2023 Amount % (in thousands, except percentages) Cost of revenue: SaaS $ 41,544 $ 35,924 $ 5,620 15.6 % Term license and support 1,584 1,946 (362 ) (18.6 )% Services 38,757 38,807 (50 ) (0.1 )% Maintenance 641 783 (142 ) (18.1 )% Total cost of revenue $ 82,526 $ 77,460 $ 5,066 6.5 % Gross profit 247,956 194,365 53,591 27.6 % Gross margin 75.0 % 71.5 % — — GAAP cost of revenue $ 82,526 $ 77,460 $ 5,066 6.5 % Stock-based compensation expense (1,315 ) (3,161 ) 1,846 (58.4 )% Amortization of acquired intangible assets (961 ) (964 ) 3 (0.3 )% Non-GAAP cost of revenue $ 80,250 $ 73,335 $ 6,915 9.4 % Non-GAAP gross profit 250,232 198,490 51,742 26.1 % Non-GAAP gross margin 75.7 % 73.0 % — — Cost of revenue increased 6.5% to $82.5 million for the year ended December 31, 2024 , driven by a $3.0 million increase in aggregated hosting costs and a $2.3 million increase in personnel costs resulting from increased SaaS revenue. 44 Table of Contents PART II Item 7 Operating Expenses Sales and Marketing Sales and marketing expenses during the years ended December 31, 2024 and 2023 were as follows: Year Ended December 31, Change 2024 2023 Amount % (in thousands, except percentages) Sales and marketing $ 122,869 $ 112,105 $ 10,764 9.6 % Percentage of revenue 37.2 % 41.2 % — — GAAP sales and marketing $ 122,869 $ 112,105 $ 10,764 9.6 % Stock-based compensation expense (8,965 ) (9,518 ) 553 (5.8 )% Amortization of acquired intangible assets (459 ) (492 ) 33 (6.7 )% Non-GAAP sales and marketing $ 113,445 $ 102,095 $ 11,350 11.1 % Non-GAAP percentage of revenue 34.3 % 37.6 % — — Sales and marketing expenses increased 9.6% to $122.9 million for the year ended December 31, 2024 , primarily driven by a $8.5 million increase in personnel costs, which included additional headcount and other investments in the business to respond to strong customer demand for our solutions and provide support for future growth.
Cost of Revenue Cost of SaaS and cost of term license and support consists of all direct costs to deliver and support our SaaS and term license and support products, including salaries, benefits, stock-based compensation and related expenses, overhead, third-party hosting fees related to our cloud services, depreciation and amortization. We recognize these expenses as they are incurred.
Cost of Revenue Cost of SaaS and cost of term license and support consists of all direct costs to deliver and support our SaaS and term license and support products, including salaries, benefits, stock-based compensation and related expenses, overhead, third-party hosting fees related to our cloud services, and depreciation and amortization. We recognize these expenses as they are incurred.
We expect that these costs will increase in absolute dollars but may fluctuate as a percentage of SaaS and term license and support revenue from period to period. Cost of maintenance consists of all direct costs to support our legacy perpetual license products, including salaries, benefits, stock-based compensation and related expenses, overhead, depreciation and amortization.
We expect that these costs will increase in absolute dollars but may fluctuate as a percentage of SaaS and term license and support revenue from period to period. Cost of maintenance consists of all direct costs to support our legacy perpetual license products, including salaries, benefits, stock-based compensation and related expenses, overhead, and depreciation and amortization.
The main considerations for non-cash items were stock-based compensation, which reflects ongoing compensation charges for the entity’s equity- and pre-merger liability-classified awards, operating lease right-of-use asset expense and mark to market adjustments on earnout and warrant liabilities.
The main considerations for non-cash items were stock-based compensation, which reflects ongoing compensation charges for the entity’s equity- and pre-merger liability-classified awards, operating lease right-of-use asset expense and mark to market adjustments on earnout and warrant liabilities.
We believe non-GAAP operating income and non-GAAP operating margin provide our management and investors consistency and comparability with our past financial performance and facilitate period-to-period comparisons of operations, as these metrics eliminate the effects of stock-based compensation, which has had historical volatility from period to period due to marked-to-market securities, and of acquired intangible assets, which are unrelated to current operations and are neither comparable to the prior period nor predictive of future results.
We believe non-GAAP operating income and non-GAAP operating margin provide our management and investors consistency and comparability with our past financial performance and facilitate period-to-period comparisons of operations, as these metrics eliminate the effects of stock-based compensation, which has had historical volatility from period to period due to mark-to-market securities, and of acquired intangible assets, which are unrelated to current operations and are neither comparable to the prior period nor predictive of future results.
While our significant accounting policies are described in more detail in the section titled “ Note - 2 Summary of Significant Accounting Policies ” (Part II, Item 8 of this Annual Report), we believe the following critical accounting policies are most important to understanding and evaluating our reported financial results. 53 Table of Contents PART II Item 7 Revenue Recognition We derive revenue from four primary sources: SaaS, term license and support, services, and maintenance.
While our significant accounting policies are described in more detail in the section titled “ Note - 2 Summary of Significant Accounting Policies ” (Part II, Item 8 of this Annual Report), we believe the following critical accounting policies are most important to understanding and evaluating our reported financial results. 50 Table of Contents PART II Item 7 Revenue Recognition We derive revenue from four primary sources: SaaS, term license and support, services, and maintenance.
Accordingly, our effective tax rate could be affected by the relative proportion of foreign to domestic income, use of foreign tax credits, changes in the valuation of our deferred tax assets and liabilities, applicability of any valuation allowances, and changes in tax laws in jurisdictions in which we operate. 45 Table of Contents PART II Item 7 Results of Operations The below period-to-period comparison of operating results are not necessarily indicative of results for future periods.
Accordingly, our effective tax rate could be affected by the relative proportion of foreign to domestic income, use of foreign tax credits, changes in the valuation of our deferred tax assets and liabilities, applicability of any valuation allowances, and changes in tax laws in jurisdictions in which we operate. 42 Table of Contents PART II Item 7 Results of Operations The below period-to-period comparison of operating results are not necessarily indicative of results for future periods.
These in turn could increase our costs, disrupt our supply chain, reduce our sales and earnings, impair our ability to raise additional capital when needed on acceptable terms, if at all, or otherwise adversely affect our business, financial condition, and results of operations. 54 Table of Contents PART II Item 7 Our international operations provide a significant portion of our total revenues and expenses.
These in turn could increase our costs, disrupt our supply chain, reduce our sales and earnings, impair our ability to raise additional capital when needed on acceptable terms, if at all, or otherwise adversely affect our business, financial condition, and results of operations. 51 Table of Contents PART II Item 7 Our international operations provide a significant portion of our total revenues and expenses.
The CODM does not receive discrete financial information about asset allocation, expense allocation, or profitability by product or geography. See “ Note 17 – Segment Information ” (Part II, Item 8 of this Annual Report) for more information.
The CODM does not receive discrete financial information about asset allocation, expense allocation, or profitability by product or geography. See “ Note 18 – Segment Information ” (Part II, Item 8 of this Annual Report) for more information.
To date, we are in compliance with all covenants under the Loan Agreement. We have not at any time, including as of and for the fiscal year ending as of December 31, 2023, borrowed under the Loan Agreement.
To date, we are in compliance with all covenants under the Loan Agreement. We have not at any time, including as of and for the fiscal year ending as of December 31, 2024, borrowed under the Loan Agreement.
Recently Issued and Adopted Accounting Pronouncements For information about recent accounting pronouncements, see Note 2 to the consolidated financial statements of this Annual Report. 55 Table of Contents PART II Item 7A
Recently Issued and Adopted Accounting Pronouncements For information about recent accounting pronouncements, see Note 2 to the consolidated financial statements of this Annual Report. 52 Table of Contents PART II Item 7A
We recognize these expenses as they are incurred. 44 Table of Contents PART II Item 7 Gross Profit and Gross Margin Gross profit is revenue less cost of revenue, and gross margin is gross profit as a percentage of revenue.
We recognize these expenses as they are incurred. 41 Table of Contents PART II Item 7 Gross Profit and Gross Margin Gross profit is revenue less cost of revenue, and gross margin is gross profit as a percentage of revenue.
This section generally discusses the results of our operations for the year ended December 31, 2023 compared to the year ended December 31, 2022.
This section generally discusses the results of our operations for the year ended December 31, 2024 compared to the year ended December 31, 2023.
ARR is not a forecast of future revenue, and the active contracts at the end of a reporting period used in calculating ARR may or may not be extended or renewed by our customers. 43 Table of Contents PART II Item 7 Components of Results of Operations Revenue We generate revenue from four primary sources: SaaS, term license and support, services, and maintenance.
ARR is not a forecast of future revenue, and the active contracts used in calculating ARR may or may not be extended or renewed by our customers. 40 Table of Contents PART II Item 7 Components of Results of Operations Revenue We generate revenue from four primary sources: SaaS, term license and support, services, and maintenance.
We believe these non-GAAP measures aid investors by providing additional insight into our operational performance and into trends affecting our business. Management uses these non-GAAP financial measures to understand and compare operating results across accounting periods, for internal budgeting and forecasting purposes, and to evaluate financial performance.
We believe these non-GAAP measures provide investors with additional insight into our operational performance and into trends affecting our business. Management uses these non-GAAP financial measures to understand and compare operating results across accounting periods, for internal budgeting and forecasting purposes, and to evaluate financial performance.
During the years ended December 31, 2023 and 2022, total rent expense for facilities amounted to $6.8 million and $6.8 million, respectively. As of December 31, 2023, letters of credit have been issued in the amount of $1.0 million as security for operating leases. The letters of credit are secured by certificates of deposit.
During the years ended December 31, 2024 and 2023, total rent expense for facilities amounted to $7.2 million and $6.8 million, respectively. As of December 31, 2024, letters of credit have been issued in the amount of $1.0 million as security for operating leases. The letters of credit are secured by certificates of deposit and a line of credit.
The increase in non-GAAP operating margin was primarily attributable to the Company ’s enhanced focus on expense management and continued scaling of the Company ’s channel partner strategy. 50 Table of Contents PART II Item 7 Liquidity and Capital Resources As of December 31, 2023 , we had $223.2 million in cash and cash equivalents, $3.7 million in short-term investments and no outstanding debt.
The increase in non-GAAP operating margin was primarily attributable to the Company ’s enhanced focus on expense management and continued scaling of the Company ’s channel partner strategy. 47 Table of Contents PART II Item 7 Liquidity and Capital Resources As of December 31, 2024 , we had $290.7 million in cash and cash equivalents, $0.2 million in short-term investments and no outstanding debt.
Borrowings under the line bear interest at a rate equal to term SOFR plus 3.00% to 3.25% depending on the Consolidated Total Leverage Ratio. The line carries an unused fee ranging from 0.50% to 0.55% depending on the Consolidated Total Leverage Ratio. Any proceeds of borrowings under the Loan Agreement will be used for general corporate purposes.
Borrowings under the line bear interest at a rate equal to term SOFR plus 3.0% to 3.3% depending on the Consolidated Total Leverage Ratio. The line carries an unused fee at a rate equal to 0.5%. Any proceeds of borrowings under the Loan Agreement will be used for general corporate purposes.
The effective tax rate, which equals the income tax provision divided by pretax loss from continuing operations, was (15.5)% for the year ended December 31, 2023 , compared to (15.0)% for the year ended December 31, 2022 .
The effective tax rate, which equals the income tax provision divided by pretax loss from continuing operations, was (19.4)% for the year ended December 31, 2024 , compared to (15.5)% for the year ended December 31, 2023 .
SaaS revenues are generated from our cloud-based solutions. Term license and support revenues are generated from the sales of on-premise or hybrid licenses which include a distinct support component. Both SaaS and term license and support revenues are primarily billed annually.
We consider SaaS, term license and support, and maintenance revenues to be recurring. SaaS revenues are generated from our cloud-based solutions. Term license and support revenues are generated from the sales of on-premise or hybrid licenses which include a distinct support component. Both SaaS and term license and support revenues are primarily billed annually.
We compete for talented individuals globally by offering an exceptional working environment, broad customer reach, scale in resources, the ability to grow one’s career across many different products and businesses, and competitive compensation and benefits.
We hire a mix of university and industry talent worldwide. We compete for talented individuals globally by offering an exceptional working environment, broad customer reach, scale in resources, the ability to grow one’s career across many different products and businesses, and competitive compensation and benefits.
The change in effective tax rates for the year ended December 31, 2023 , as compared to the year ended December 31, 2022 , was primarily due to the mix of pre-tax income (loss) results by jurisdictions taxed at different rates than 21%, a permanent item recorded for stock-based compensation and changes in the valuation allowance in the U.S. and certain foreign jurisdictions. 49 Table of Contents PART II Item 7 Non-GAAP Operating Income (loss) and Non-GAAP Operating Margin The following table presents a reconciliation of non-GAAP operating income from the most comparable GAAP measure, operating income, for the periods presented: Year Ended December 31, 2023 2022 (in thousands, except percentages) GAAP operating loss $ (15,351 ) $ (41,066 ) GAAP operating margin (5.6 )% (17.7 )% Add: Stock-based compensation 36,048 37,218 Amortization of acquired intangible assets 1,456 955 Non-GAAP operating income (loss) $ 22,153 $ (2,893 ) Non-GAAP operating margin 8.1 % (1.2 )% Non-GAAP operating income and non-GAAP operating margin are non-GAAP financial measures that our management uses to assess our overall performance.
The change in effective tax rates for the year ended December 31, 2024 , as compared to the year ended December 31, 2023 , was primarily due to the mix of pre-tax income (loss) results by jurisdictions taxed at different rates than 21%, a permanent item recorded for stock-based compensation, GILTI, fair value of earnout liability and changes in the valuation allowance in the U.S. and certain foreign jurisdictions. 46 Table of Contents PART II Item 7 Non-GAAP Operating Income and Non-GAAP Operating Margin The following table presents a reconciliation of non-GAAP operating income from the most comparable GAAP measure, operating income, for the periods presented: Year Ended December 31, 2024 2023 (in thousands, except percentages) GAAP operating income (loss) $ 7,166 $ (15,351 ) GAAP operating margin 2.2 % (5.6 )% Add: Stock-based compensation 39,059 36,048 Amortization of acquired intangible assets 1,420 1,456 Non-GAAP operating income $ 47,645 $ 22,153 Non-GAAP operating margin 14.4 % 8.1 % Non-GAAP operating income and non-GAAP operating margin are non-GAAP financial measures that our management uses to assess our overall performance.
APAC revenues increased 22.0% to $71.6 million, driven by a 45.9%, or $9.7 million increase in SaaS revenue and a 20.9%, or $4.9 million, increase in services revenue, partially offset by a $1.7 million combined decrease in term license and support and maintenance revenue. 46 Table of Contents PART II Item 7 Non-GAAP Financial Measures In addition to our financial results determined in accordance with GAAP, we disclose non-GAAP cost of revenue, non-GAAP gross profit, non-GAAP gross margin, non-GAAP sales and marketing expense, non-GAAP general and administrative expense, non-GAAP research and development expense, non-GAAP operating income and non-GAAP operating margin.
APAC revenues increased 33.2% to $95.4 million, primarily driven by a 49.2%, or $15.2 million, increase in SaaS revenue, a 24.1%, or $6.9 million, increase in services revenue, and a $1.7 million combined increase in term license and support and maintenance revenue. 43 Table of Contents PART II Item 7 Non-GAAP Financial Measures In addition to our financial results determined in accordance with GAAP, we disclose non-GAAP cost of revenue, non-GAAP gross profit, non-GAAP gross margin, non-GAAP sales and marketing expense, non-GAAP general and administrative expense, non-GAAP research and development expense, non-GAAP operating income and non-GAAP operating margin.
GAAP operating margin for the years ended December 31, 2023 and 2022 was (5.6)% and (17.7)% respectively. Non-GAAP operating margin for the years ended December 31, 2023 and 2022 was 8.1% and (1.2)% , respectively.
GAAP operating margin for the years ended December 31, 2024 and 2023 was 2.2% and (5.6)% , respectively. Non-GAAP operating margin for the years ended December 31, 2024 and 2023 was 14.4% and 8.1% , respectively.
The Company, on a consolidated basis with its subsidiaries, is required to maintain a minimum Consolidated Fixed Charge Coverage Ratio (as defined in the Loan Agreement) as well as a maximum Consolidated Total Leverage Ratio, tested by HSBC each quarter.
We are required to maintain a minimum Consolidated Fixed Charge Coverage Ratio (as defined in the Loan Agreement) as well as a maximum Consolidated Total Leverage Ratio, tested by HSBC each quarter.
Investing Activities Net cash used in investing activities for the year ended December 31, 2023, was $5.6 million, consisting of $2.1 million of purchases of property and equipment, as well as $2.6 million in maturities of short-term investments and $3.5 million in the purchase of investments.
Net cash used in investing activities for the year ended December 31, 2023, was $5.6 mill ion, primarily consisting of $3.5 million in the purchase of investments, $2.1 million of purchases of property and equipment, $1.4 million in software development, and $1.3 million investment in notes, partially offset by $2.6 million in maturities of short-term investments.
For a discussion of the year ended December 21, 2022 compared to the year ended December 31, 2021, please refer to Part II, Item 7, “ Management ’s Discussion and Analysis of Financial Condition and Results of Operations ” in our Annual Report on Form 10-K for the year ended December 31, 2022. 2023 Business Highlights ■ Total annual recurring revenue (“ ARR ”) increased 23% year-over-year to $264.5 million as of December 31, 2023.
For a discussion of the year ended December 31, 2023 compared to the year ended December 31, 2022, please refer to Part II, Item 7, “ Management ’s Discussion and Analysis of Financial Condition and Results of Operations ” in our Annual Report on Form 10-K for the year ended December 31, 2023 , which discussion is incorporated herein by reference. 2024 Business Highlights ■ As of December 31, 2024, total annual recurring revenue (“ ARR ”) was $327.0 million, representing 24% year-over-year growth.
Income Tax Provision Income tax provision during the years ended December 31, 2023 and 2022 was as follows: Year Ended December 31, Change 2023 2022 Amount % (in thousands, except percentages) Income tax expense $ 2,887 $ 5,038 $ (2,151 ) (42.7 )% Income tax expense for the year ended December 31, 2023 was $2.9 million as compared to $5.0 million for the year ended December 31, 2022.
Income Tax Provision Income tax provision during the years ended December 31, 2024 and 2023 was as follows: Year Ended December 31, Change 2024 2023 Amount % (in thousands, except percentages) Income tax expense $ 4,743 $ 2,887 $ 1,856 64.3 % Income tax expense for the year ended December 31, 2024 was $4.7 million as compared to $2.9 million for the year ended December 31, 2023.
Year Ended December 31, 2023 2022 (in thousands) Net cash provided by (used in) operating activities $ 34,694 $ (774 ) Net cash used in investing activities (5,648 ) (21,452 ) Net cash used in financing activities (33,667 ) (17,148 ) 51 Table of Contents PART II Item 7 Operating Activities Net cash provided by operating activities for the year ended December 31, 2023, was $34.7 million, reflecting our net loss of $21.5 million, adjusted for non-cash items of $58.6 million and net cash outflows of $2.4 million from changes in our operating assets and liabilities.
Net cash provided by operating activities for the year ended December 31, 2023, was $34.7 million, reflecting our net loss of $21.5 million, adjusted for non-cash items of $58.6 million and net cash outflows of $2.4 million from changes in our operating assets and liabilities.
The investments we are making in infrastructure, research and development, marketing, and geographic expansion will continue to increase our operating costs and may decrease our operating margins. Our success is highly dependent on our ability to attract and retain qualified employees. We hire a mix of university and industry talent worldwide.
We must continue to evolve and adapt to keep pace with this changing environment. The investments we are making in infrastructure, research and development, marketing, and geographic expansion will continue to increase our operating costs and may decrease our operating margins. Our success is highly dependent on our ability to attract and retain qualified employees.
Borrowings under the line bear interest at a rate equal to term SOFR plus 3.00% to 3.25% depending on the Consolidated Total Leverage Ratio (as defined in the Loan Agreement). The line carries an annual unused fee ranging from 0.50% to 0.55% depending on the Consolidated Total Leverage Ratio.
The line bears interest at a rate equal to term SOFR plus 3.0% to 3.3% depending on the Consolidated Total Leverage Ratio (as defined in the Loan Agreement). The line carries an unused fee equal to 0.5%. The line will mature on November 3, 2026.
The primary driver of cash flows from financing activities was due to $19.9 million in purchases of common stock, partially offset by $2.8 million of proceeds from the exercising of stock options. 52 Table of Contents PART II Item 7 Indebtedness Credit Facility We maintain a line of credit under the Loan Agreement with HSBC, as lender.
Net cash used in financing activities for the year ended December 31, 2023, was $33.7 million, primarily due to $39.0 million in purchases of common stock, partially offset by $5.6 million of proceeds from the exercising of stock options. 49 Table of Contents PART II Item 7 Indebtedness Credit Facility We maintain a line of credit under the Loan Agreement with HSBC, as lender.
EMEA revenues increased by 14.1% to $81.8 million, driven by a 43.7%, or $18.1 million, increase in SaaS revenue, partially offset by a $8.0 million combined decrease in term license and support, services and maintenance revenue.
EMEA revenues increased by 21.4% to $99.3 million, driven by a 39.8%, or $23.8 million, increase in SaaS revenue, partially offset by a $6.3 million combined decrease in term license and support, services and maintenance revenue.
Annual Recurring Revenue December 31, Change 2023 2022 % Total ARR ($ in mil) $ 264.5 $ 214.7 23.2 % We calculate ARR at the end of a particular period as the annualized sum of contractually obligated Annual Contract Value (“ ACV ”) from SaaS, term license and support, and maintenance revenues from all active customers.
We calculate ARR as the annualized sum of contractually obligated Annual Contract Value (“ ACV ”) from SaaS, term license and support, and maintenance revenue sources from all active customers at the end of a reporting period. As of December 31, 2024 and 2023, total ARR was $327.0 million and $264.5 million, respectively, representing growth of 24%.
Using a combination of the relative fair value method or the residual value method, the SSP of the performance obligations in an arrangement is allocated to each performance obligation within a sales arrangement.
Using a combination of the relative fair value method or the residual value method, the SSP of the performance obligations in an arrangement is allocated to each performance obligation within a sales arrangement. Economic Conditions, Challenges, and Risks The markets for software and cloud-based services are dynamic and highly competitive.
Our short-term liquidity needs primarily include working capital for sales and marketing, research and development, and continued innovation. Our long-term capital requirements will depend on many factors, including our growth rate, levels of revenue, the expansion of sales and marketing activities, market acceptance of our platform, the results of business initiatives, and the timing of new product introductions.
Our long-term capital requirements will depend on many factors, including our growth rate, levels of revenue, the expansion of sales and marketing activities, market acceptance of our platform, the results of business initiatives, and the timing of new product introductions. Refer to “ Note 12 - Commitments and Contingencies ” for more information regarding the purchase commitments.
We believe that both management and investors benefit from referring to this metric to evaluate progress against our growth strategies and gain additional transparency into performance trends.
Key Business Metric Our management reviews the following key business metric to measure our performance, identify trends affecting our business, formulate business plans, make strategic decisions, and effectively allocate resources. We believe that both management and investors benefit from referring to this metric to evaluate progress against our growth strategies and gain additional transparency into performance trends.
General and Administrative General and administrative expenses during the years ended December 31, 2023 and 2022 were as follows: Year Ended December 31, Change 2023 2022 Amount % (in thousands, except percentages) General and administrative $ 61,271 $ 65,132 $ (3,861 ) (5.9 )% Percentage of revenue 22.5 % 28.0 % — — GAAP general and administrative $ 61,271 $ 65,132 $ (3,861 ) (5.9 )% Stock-based compensation expense (19,338 ) (19,398 ) 60 (0.3 )% Non-GAAP general and administrative $ 41,933 $ 45,734 $ (3,801 ) (8.3 )% Non-GAAP percentage of revenue 15.4 % 19.7 % — — General and administrative expenses decreased 5.9% to $61.3 million for the year ended December 31, 2023 .
General and Administrative General and administrative expenses during the years ended December 31, 2024 and 2023 were as follows: Year Ended December 31, Change 2024 2023 Amount % (in thousands, except percentages) General and administrative $ 69,222 $ 61,271 $ 7,951 13.0 % Percentage of revenue 20.9 % 22.5 % — — GAAP general and administrative $ 69,222 $ 61,271 $ 7,951 13.0 % Stock-based compensation expense (20,483 ) (19,338 ) (1,145 ) 5.9 % Non-GAAP general and administrative $ 48,739 $ 41,933 $ 6,806 16.2 % Non-GAAP percentage of revenue 14.7 % 15.4 % — — General and administrative expenses increased 13.0% to $69.2 million for the year ended December 31, 2024 .
This was partially offset by cash inflows related to an increase in deferred revenue that is partially offset by an increase in accounts receivable as a result of business growth, and an increase in accrued expenses primarily due to personnel related expenses.
The main considerations of changes in operating assets and liabilities that resulted in cash inflows related to an increase in deferred revenue that is partially offset by an increase in accounts receivable as a result of business growth. This was partially offset by cash outflows related to an increase in deferred contract costs and operating lease liabilities.
Revenue by geographic area during the years ended December 31, 2023 and 2022 was as follows: Year Ended December 31, Change 2023 2022 Amount % (in thousands, except percentages) North America $ 118,490 $ 102,025 $ 16,465 16.1 % EMEA 81,753 71,635 10,118 14.1 % APAC 71,582 58,679 12,903 22.0 % Total $ 271,825 $ 232,339 $ 39,486 17.0 % For the year ended December 31, 2023 , North America revenues increased 16.1% to $118.5 million, driven by a 29.2%, or $15.9 million, increase in SaaS revenue and a $2.2 million combined increase in services revenue and term license and support revenue, partially offset by a $1.6 million decrease in maintenance revenue.
Revenue by geographic area during the years ended December 31, 2024 and 2023 was as follows: Year Ended December 31, Change 2024 2023 Amount % (in thousands, except percentages) North America $ 135,870 $ 118,490 $ 17,380 14.7 % EMEA 99,256 81,753 17,503 21.4 % APAC 95,356 71,582 23,774 33.2 % Total $ 330,482 $ 271,825 $ 58,657 21.6 % For the year ended December 31, 2024 , North America revenues increased 14.7% to $135.9 million, driven by a 43.6%, or $30.7 million, increase in SaaS revenue, partially offset by a $13.3 million combined decrease in term license and support, services and maintenance revenue.
Financing Activities Net cash used in financing activities for the year ended December 31, 2023, was $33.7 million. The primary driver of cash flows from financing activities was due to $39.0 million in purchases of common stock, partially offset by $5.6 million of proceeds from the exercising of stock options.
Financing Activities Net cash used in financing activities for the year ended December 31, 2024, was $15.5 million, primarily due to $33.1 million in purchases of common stock, $6.1 million in the redemption of the redeemable noncontrolling interest of MaivenPoint, and $4.0 million in the purchase of public warrants, partially offset by $17.2 million of proceeds from the exercising of warrants, and $11.0 million of proceeds from the exercising of stock options.
Term license and support revenue is expected to continue declining as some existing customers are moving from on-prem term license subscriptions to SaaS subscriptions. Maintenance revenue is expected to continue declining as revenues from the sales of legacy perpetual licenses are immaterial. As a result, there will be limited opportunities to sell maintenance contracts to new customers.
Additionally, maintenance revenue is expected to continue declining as we have shifted away from the sale of perpetual licenses and towards SaaS and term licenses. Without perpetual license sales, there will be limited opportunities to sell maintenance contracts to new customers.
The decrease in overall general and administrative expenses reflects the Company ’s enhanced focus on cost management. 48 Table of Contents PART II Item 7 Research and Development Research and development expenses during the years ended December 31, 2023 and 2022 were as follows: Year Ended December 31, Change 2023 2022 Amount % (in thousands, except percentages) Research and development $ 36,340 $ 31,359 $ 4,981 15.9 % Percentage of revenue 13.4 % 13.5 % — — GAAP research and development $ 36,340 $ 31,359 $ 4,981 15.9 % Stock-based compensation expense (4,031 ) (3,787 ) (244 ) 6.4 % Non-GAAP research and development $ 32,309 $ 27,572 $ 4,737 17.2 % Non-GAAP percentage of revenue 11.9 % 11.9 % — — Research and development expenses increased 15.9% to $36.3 million for the year ended December 31, 2023, primarily driven by a $4.3 million increase in personnel costs, as the Company continues to invest in the development of new offerings and enhancements to existing offerings.
The increase was primarily driven by a $3.9 million increase in personnel costs and $2.4 million in new fees related to the Company ’s investment in a growth equity fund. 45 Table of Contents PART II Item 7 Research and Development Research and development expenses during the years ended December 31, 2024 and 2023 were as follows: Year Ended December 31, Change 2024 2023 Amount % (in thousands, except percentages) Research and development $ 48,699 $ 36,340 $ 12,359 34.0 % Percentage of revenue 14.7 % 13.4 % — — GAAP research and development $ 48,699 $ 36,340 $ 12,359 34.0 % Stock-based compensation expense (8,296 ) (4,031 ) (4,265 ) 105.8 % Non-GAAP research and development $ 40,403 $ 32,309 $ 8,094 25.1 % Non-GAAP percentage of revenue 12.2 % 11.9 % — — Research and development expenses increased 34.0% to $48.7 million for the year ended December 31, 2024, primarily driven by a $10.7 million increase in personnel costs, which included additional headcount and ongoing investment in the development of new offerings and enhancements to existing offerings.
Customer preferences evolve rapidly, and choices in hardware, products, and devices can and do influence how users access services in the cloud, and in some cases, the user’s choice of which suite of cloud-based services to use. We must continue to evolve and adapt to keep pace with this changing environment.
Our competitors are developing new software while also deploying competing cloud-based services for consumers and businesses. Customer preferences evolve rapidly, and choices in hardware, products, and devices can and do influence how users access services in the cloud, and in some cases, the user’s choice of which suite of cloud-based services to use.
We recognize these expenses as they are incurred. We expect that cost of maintenance revenue will decrease in absolute dollars as maintenance revenue declines but may fluctuate as a percentage of maintenance revenue.
We recognize these expenses as they are incurred. We expect that cost of maintenance revenue will decrease in absolute dollars as maintenance revenue declines but may fluctuate as a percentage of maintenance revenue. Cost of services consists of salaries, benefits, stock-based compensation and related expenses for our services organization, overhead, technology necessary to service our customers, and depreciation and amortization.
Pursuant to the Loan Agreement, the Company pledged, assigned and granted HSBC a security interest in all shares of its subsidiaries, future proceeds, and assets as security for its obligations under the Loan Agreement. The line will mature on November 3, 2026.
Pursuant to the Loan Agreement, we pledged, assigned and granted HSBC a security interest in all shares of our subsidiaries, future proceeds, and assets as security for our obligations under the Loan Agreement. As of December 31, 2024, we are compliant with all covenants and had no borrowings outstanding under the Loan Agreement.
Net cash used in investing activities for the year ended December 31, 2022, was $21.5 mill ion, consisting of $18.6 million in acquisitions and $3.9 million of purchases of property and equipment, as well as $183.5 million in maturities of short-term investments and $180.9 million in the purchase of investments.
Investing Activities Net cash used in investing activities for the year ended December 31, 2024, was $2.6 million, primarily consisting of $3.0 million of purchases of property and equipment, $1.8 million in the purchase of investments, $1.8 million investment in notes, and $1.2 million in software development, partially offset by $5.4 million in maturities of short-term investments.
The Loan Agreement provides for a revolving line of credit of up to $30.0 million, with an additional $20.0 million accordion feature for additional capital which the Company may draw upon at its request.
We also maintain a loan and security agreement (the “ Loan Agreement ”), dated November 3, 2023, with HSBC Bank USA, National Association (“ HSBC ”), as lender, for a revolving line of credit of up to $30.0 million with an accordion feature that provides up to $20.0 million of additional borrowing capacity we may draw upon at our request.
Comparison of the Years Ended December 31, 2023, and December 31, 2022 Revenue The components of AvePoint ’s revenue during the years ended December 31, 2023 and 2022 were as follows: Year Ended December 31, Change 2023 2022 Amount % (in thousands, except percentages) Revenue: SaaS $ 160,961 $ 117,180 $ 43,781 37.4 % Term license and support 52,744 57,214 (4,470 ) (7.8 )% Services 44,795 41,283 3,512 8.5 % Maintenance 13,325 16,662 (3,337 ) (20.0 )% Total revenue $ 271,825 $ 232,339 $ 39,486 17.0 % Total revenue increased 17.0% to $271.8 million for the year ended December 31, 2023 , primarily as a result of an increase in SaaS revenue.
Comparison of the Years Ended December 31, 2024 and December 31, 2023 Revenue The components of AvePoint ’s revenue during the years ended December 31, 2024 and 2023 were as follows: Year Ended December 31, Change 2024 2023 Amount % (in thousands, except percentages) Revenue: SaaS $ 230,667 $ 160,961 $ 69,706 43.3 % Term license and support 44,560 52,744 (8,184 ) (15.5 )% Services 44,036 44,795 (759 ) (1.7 )% Maintenance 11,219 13,325 (2,106 ) (15.8 )% Total revenue $ 330,482 $ 271,825 $ 58,657 21.6 % Total revenue increased 21.6% to $330.5 million for the year ended December 31, 2024 , due to an increase in SaaS revenue, which increased 43.3% to $230.7 million, and represented 70% of total revenue, up from 59% of total revenue in the prior year.
ARR should be viewed independently of revenue and deferred revenue and is not intended to be combined with or replace these items.
Adjusted for FX, total ARR increased 25% year-over-year. Growth in ARR is driven by both new customer acquisition and the expansion of existing customer relationships. ARR should be viewed independently of revenue and deferred revenue and is not intended to be combined with or replace these items.
Seasonality Our quarterly revenue fluctuates and does not necessarily grow sequentially when measuring any one fiscal quarter’s revenue with another (e.g. comparing the fourth fiscal quarter of fiscal year 2022 with the first fiscal quarter of fiscal year 2023).
Seasonality Our quarterly revenue can fluctuate and does not necessarily grow sequentially when measuring any one fiscal quarter’s revenue against another. Historically, our first quarter has been our lowest revenue quarter and our fourth quarter has been our highest revenue quarter, however those results are not necessarily indicative of future quarterly revenue or full year results.
For the year ended December 31, 2023 , SaaS revenue increased 37.4% to $161.0 million, as we continued to see strong customer demand for this offering. The increase in SaaS revenue was partially offset by an expected decrease in both term license and support and maintenance revenue.
The increase in SaaS revenue, which was driven by strong customer demand for our SaaS solutions, was partially offset by an expected decrease in both term license and support and maintenance revenue. Services revenue is expected to fluctuate as the services generally are not recurring in nature.
Net cash used in operating activities for the year ended December 31, 2022, was $0.8 million, reflecting our net loss of $38.7 million, adjusted for non-cash items of $46.2 million and net cash outflows of $8.3 million from changes in our operating assets and liabilities.
Year Ended December 31, 2024 2023 (in thousands) Net cash provided by operating activities $ 88,894 $ 34,694 Net cash used in investing activities (2,601 ) (5,648 ) Net cash used in financing activities (15,537 ) (33,667 ) 48 Table of Contents PART II Item 7 Operating Activities Net cash provided by operating activities for the year ended December 31, 2024, was $88.9 million, reflecting our net loss of $29.1 million, adjusted for non-cash items of $89.3 million and net cash inflows of $28.8 million from changes in our operating assets and liabilities.
The minimal increase in overall sales and marketing expenses reflects the Company ’s enhanced focus on cost management as well as the continued scaling of the Company ’s channel partner strategy.
The decline in sales and marketing expenses as a percentage of revenue reflects the continued scaling of the company’s focus on channel partnerships and strategies as well as ongoing improvements in overall sales efficiency.
At the same time, some existing maintenance customers have transitioned and will continue to transition to SaaS and term licenses, which will continue the decline in maintenance revenue. Lastly, s ervices revenue is expected to fluctuate as the offerings are not inherently recurring in nature.
Existing customers have and will continue to transition to SaaS and term licenses, which will further support the continued decline in maintenance revenue.
Non-GAAP operating income was $22.2 million dollars, or a non-GAAP operating margin of 8.1%, representing year-over-year margin expansion of over 930 basis points; and ■ Cash flow from operations was $34.7 million, compared to $(0.8) million for the year ended December 31, 2022.
Non-GAAP operating income was $47.6 million, compared to non-GAAP operating income of $22.2 million in 2023; and ■ Net cash provided by operating activities was $88.9 million, representing 27% of revenue, compared to $34.7 million, representing 13% of revenue, for the year ended December 31, 2023.
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On a foreign exchange (“ FX ”) adjusted basis, total ARR increased 24% year-over-year; ■ Total revenue increased 17% year-over-year to $271.8 million; ■ SaaS revenue increased 37% year-over-year to $161.0 million; ■ GAAP operating loss was $15.4 million dollars, or a GAAP operating margin of (5.6)%, representing year-over-year margin improvement of more than 1,200 basis points.
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On a foreign exchange (“ FX ”) adjusted basis, total ARR increased 25% year-over-year; ■ Total revenue increased 22% year-over-year to $330.5 million. On a constant currency basis, total revenue increased 22% year-over-year; ■ SaaS revenue increased 43% year-over-year to $230.7 million and represented 70% of total revenue, compared to 59% of revenue in 2023.
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Overview AvePoint provides a cloud-native data management software platform that organizations rely on to manage and protect critical data, optimize IT operations, achieve meaningful cost savings, and efficiently secure the digital workplace.
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On a constant currency basis, SaaS revenue increased 44% year-over-year; ■ GAAP operating income was $7.2 million, compared to a GAAP operating loss of $(15.4) million in 2023.
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Companies around the world have now fully adopted a hybrid work model, and they are now tasked with delivering a seamless and secure workplace experience for knowledge workers, centered around an extensive portfolio of Software-as-a-Service (“ SaaS ”) solutions and productivity applications.
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Overview AvePoint empowers organizations of all sizes, industries, and regions with its cloud-native data management software platform, enabling them to prepare, secure, and optimize their critical data. The AvePoint Confidence Platform unifies data security, governance, and business continuity into a seamless, resilient experience, addressing the most pressing challenges in today’s complex digital landscape.
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The adoption of this portfolio of solutions is a substantial and ongoing challenge for most organizations, which for decades had used only a small number of multi-purpose on-premises applications to drive business outcomes.
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In a world where data is sprawling across hybrid work environments and generative AI technologies are rapidly emerging, AvePoint stands out with its platform-first strategy. By integrating features and solutions to optimize operations, AvePoint delivers more than basic security controls—it redefines how businesses manage their most sensitive data and critical assets.
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However, to deliver an efficient digital workplace today, companies must manage this range of applications – and the associated explosive growth and sprawl of critical data – with a platform offering that is well governed, fit for purpose, easy to use and built on automation.
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This holistic and automated approach enables organizations to secure the perimeter for sensitive data, strategically govern digital workspaces, and ensure compliance with evolving regulatory requirements. 39 Table of Contents PART II Item 7 Organizations today face a host of challenges that make a robust data management strategy indispensable, including: ■ Optimizing data for AI : As organizations modernize their data ecosystems, the complexities of leveraging generative artificial intelligence (“AI”) technologies require proper governance, security, and lifecycle management.
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In addition, many organizations are beginning to realize the potential of generative artificial intelligence (“ AI ”) to drive competitive advantage and value creation, including (1) extracting greater value from complex datasets, (2) making more informed business decisions, (3) reducing employee workloads, and (4) improving the overall customer experience.
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With AvePoint, companies can extract more value from complex datasets, make informed decisions, reduce workloads, and enhance customer experiences. ■ Explosive data growth : The hybrid work model and software-as-a-service (“SaaS”) proliferation have led to a surge in unstructured, sensitive data.
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While these data-driven improvements are expected to lead to stronger revenue growth and operational efficiency, successfully leveraging this new technology is in turn dependent on first addressing data management challenges that all organizations face.
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AvePoint’s solutions tackle the sprawl with robust control and protection measures to manage this growth. ■ A dangerous threat landscape and complex regulations : Companies are navigating increasing cyber threats and global regulatory demands.
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Specifically, for AI-driven projects to succeed, companies must apply robust strategies across the data estate to manage the information lifecycle, properly govern and secure their data, and ensure its compliance.
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AvePoint ensures data is protected, secure, and compliant, helping mitigate financial, operational, and reputational risks. ■ The need for automation : To monitor, govern, and respond to threats efficiently, organizations require streamlined, automated platforms that deliver rapid value. AvePoint’s automation layer integrates seamlessly to achieve this efficiency.
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These are the core business problems that AvePoint has been solving for more than two decades, and why we believe AvePoint is well positioned to be a key enabler of generative AI adoption within enterprises in the coming years.
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Guided by its Beyond Secure philosophy, AvePoint goes beyond traditional boundaries to inspire trust, enabling organizations to focus on innovation while protecting against data breaches and unauthorized access. For over 20 years, AvePoint has continually innovated to provide solutions that meet the demands of modern data management, empowering businesses to overcome challenges and unlock new possibilities in an ever-evolving landscape.
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AvePoint’s Confidence Platform empowers organizations – of all sizes, in all regions, and across all industries – to optimize and secure the solutions that most commonly establish and underpin the digital workplace.
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Annual Recurring Revenue December 31, 2024 2023 Total ARR ($ in mil) $ 327.0 $ 264.5 We believe ARR further enables measurement of our business performance, is an important metric for financial forecasting, and better enables us to make strategic business decisions.
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As our customers seek to rapidly reduce costs, improve productivity and make more informed business decisions, they depend on our platform for data-driven insights, critical business intelligence and ongoing operational value through automation. 42 Table of Contents PART II Item 7 Key Business Metric Our management reviews the following key business metric to measure our performance, identify trends affecting our business, formulate business plans, make strategic decisions, and effectively allocate resources.
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Our short-term liquidity needs primarily include working capital for sales and marketing, research and development, and continued innovation. In addition, we extended a credit facility with a remaining commitment of $1.5 million, and committed $50.0 million to a growth equity fund.
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As of December 31, 2023, and December 31, 2022, total ARR was $264.5 million and $214.7 million, respectively, representing growth of 23.2%. Adjusted for FX, total ARR increased 24.0% year-over-year. Growth in ARR is driven by both new business and the expansion of existing business.
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We also have letters of credit issued in the amount of $1.0 million as security for operating leases, and $4.4 million as security for customer contingency agreements.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeDollars would have decreased by approximately $3.4 million and $2.7 million, respectively, assuming constant foreign currency cash, cash equivalents and marketable securities balances. Concentration of Credit Risk We deposit our cash with financial institutions, and, at times, such balances may exceed federally insured limits.
Biggest changeConcentration of Credit Risk We deposit our cash with financial institutions, and, at times, such balances may exceed federally insured limits. 53 Table of Contents PART II Item 8
Dollars for a significant portion of the cash held by these subsidiaries is subject to translation variance caused by changes in foreign currency exchange rates as of the end of each respective reporting period, the offset to which is substantially recorded to accumulated other comprehensive income on our consolidated balance sheets and is also presented as a line item in its consolidated statements of comprehensive income.
Dollars for a significant portion of the cash held by these subsidiaries is subject to translation variance caused by changes in foreign currency exchange rates as of the end of each respective reporting period, the offset to which is substantially recorded to accumulated other comprehensive income on our consolidated balance sheets and is also presented as a line item in its consolidated statements of comprehensive loss.
The effect of a hypothetical 10% change in interest rates would not have a material negative impact on our consolidated financial statements. As of December 31, 2023, we had no outstanding obligations under our line of credit with HSBC under the Loan Agreement.
The effect of a hypothetical 10% change in interest rates would not have a material negative impact on our consolidated financial statements. As of December 31, 2024, we had no outstanding obligations under our line of credit with HSBC under the Loan Agreement.
If overall foreign currency exchange rates in comparison to the U.S. Dollar uniformly would have been weaker by 10% as of December 31, 2023, and December 31, 2022, the amount of cash, cash equivalents and marketable securities AvePoint would have reported in U.S.
If overall foreign currency exchange rates in comparison to the U.S. Dollar uniformly would have been weaker by 10% as of December 31, 2024, and December 31, 2023, the amount of cash, cash equivalents and marketable securities AvePoint would have reported in U.S.
Due to the short-term nature of these instruments, we believe that it does not have any material exposure to changes in the fair value of our investment portfolio due to changes in interest rates. Declines in interest rates, however, would reduce our future interest income.
Due to the short-term nature of these instruments, we do not believe that we have any material exposure to changes in the fair value of our investment portfolio due to changes in interest rates. Declines in interest rates, however, would reduce our future interest income.
ITEM 7A. Quantitative and Qualitative Disclosures About Market Risks Interest Rate Risk We had cash and cash equivalents, marketable securities, and short-term deposits of $226.9 million as of December 31, 2023. We hold cash and cash equivalents, marketable securities, and short-term deposits for working capital purposes. Our cash and cash equivalents are held in cash deposits and money market funds.
ITEM 7A. Quantitative and Qualitative Disclosures About Market Risks Interest Rate Risk We had cash and cash equivalents, marketable securities, and short-term deposits of $290.9 million as of December 31, 2024, which we hold for working capital purposes. Our cash and cash equivalents are held in cash deposits and money market funds.
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Additionally, no customer accounted for more than 10% of billings for the years ended December 31, 2023 and 2022, and no customers made up more than 10% of accounts receivable for the years ended December 31, 2023 and 2022. 56 Table of Contents PART II Item 8
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Dollars would have decreased by approximately $4.8 million and $3.4 million, respectively, assuming constant foreign currency cash, cash equivalents and marketable securities balances. We believe we are in large part naturally hedged against foreign currency exchange risk from our ongoing business operations, as most of our regional revenues are generated in the same currency as that region’s expenses are paid.

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