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

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Paragraph-level year-over-year comparison of Intapp, 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.

+381 added−462 removedSource: 10-K (2024-08-26) vs 10-K (2023-09-07)

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

381 paragraphs added · 462 removed · 305 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

64 edited+19 added−19 removed42 unchanged
Biggest changeOur full range of solutions are delivered through an integrated cloud platform underpinned by key technology capabilities: • A modern, cloud-based architecture purpose-built to meet industry needs; • A low-code, tailored, configurable user experience (“UX”), based on industry-specific templates that meet users’ specific needs; 2 Table of Contents • An applied AI strategy that combines modern AI with our market expertise to help professional and financial services firms optimize the use of their vast amounts of data; and • A specialized data architecture based on an industry graph data model that is purpose-built to capture professional and financial services firms’ unique operating model — supporting the complex integrations needed to deliver data where and when it is needed.
Biggest changeOur full range of solutions are delivered through an integrated cloud platform underpinned by key technology capabilities: • A modern, cloud-based architecture purpose-built to meet industry needs; • A low-code, tailored, configurable user experience (“UX”), based on industry-specific templates that meet users’ specific needs; • An applied AI strategy that incorporates modern AI into our cloud offerings.
We leverage our deep domain expertise in professional and financial services to create and provide our clients access to pre-built industry-relevant configuration templates that are designed precisely for how these firms and their professionals operate.
We leverage our deep domain expertise in professional and financial services to create and provide our clients with access to pre-built industry-relevant configuration templates that are designed precisely for how these firms and their professionals operate.
Using Intapp, risk and compliance teams can work seamlessly together with front-office professionals, all within the Intapp platform, to quickly assess new business opportunities, clear and manage conflicts and independence issues, easily establish ethical walls, prepare for regulatory or client audits, and dynamically respond to rapidly changing regulatory landscapes and the firm’s overall risk posture. • Leverage collective knowledge for competitive advantage.
Using Intapp, risk and compliance teams can work seamlessly together with front-office professionals, all within the Intapp Intelligent Cloud platform, to quickly assess new business opportunities, clear and manage conflicts and independence issues, easily establish ethical walls, prepare for regulatory or client audits, and dynamically respond to rapidly changing regulatory landscapes and the firm’s overall risk posture. • Leverage collective knowledge for competitive advantage.
Examples include: • Enhanced conflicts review on matters with large number of parties — such as bankruptcies and restructuring — to accelerate conflicts clearance and help firms open matters faster with fewer errors. 3 Table of Contents • Billable activity capture to find missing time and automatically fill out timesheets to reduce revenue leakage, minimize write-offs, and accelerate cash and collections. • Analysis of firms’ collected relationships to identify the strongest approach to winning new business and retaining important clients. • Self-maintaining contacts in firm systems to keep contact records up to date — without requiring manual data entry.
Examples include: • Enhanced conflicts review on matters with large number of parties — such as bankruptcies and restructuring — to accelerate conflicts clearance and help firms open matters faster with fewer errors. • Billable activity capture to find missing time and automatically fill out timesheets to reduce revenue leakage, minimize write-offs, and accelerate cash and collections. • Analysis of firms’ collected relationships to identify the strongest approach to winning new business and retaining important clients. • Self-maintaining contacts in firm systems to keep contact records up to date — without requiring manual data entry.
We support our clients with access to engineers, other technical support personnel, release management, and managed services. To help our clients achieve success with the Intapp platform, we offer in-depth change management workshops, classroom and virtual end-user and administrator training, consultative adoption services, and best practices.
We support our clients with access to engineers, other technical support personnel, release management, and managed services. To help our clients achieve success with the Intapp Intelligent Cloud platform, we offer in-depth change management workshops, classroom and virtual end-user and administrator training, consultative adoption services, and best practices.
The Intapp platform offers our developers an opportunity to build important solutions that can become the standard in the professional and financial services industry, while enabling sales personnel to sell a growing portfolio of solutions to a focused, deep set of professional and financial services firms.
The Intapp Intelligent Cloud platform offers our developers an opportunity to build important solutions that can become the standard in the professional and financial services industry, while enabling sales personnel to sell a growing portfolio of solutions to a focused, deep set of firms.
By leveraging Intapp’s open (REST) APIs, client IT departments, other software providers, firm consultants, and partners in Intapp’s ecosystem can extend the benefits of Intapp’s platform to a broader range of business applications. Low-code configurability and personalized UX Our configurable UX capabilities allow both technical and non-technical users to rapidly tailor our applications to meet their specific needs.
By leveraging Intapp’s open (REST) APIs, client IT departments, other software providers, firm consultants, and partners in Intapp’s ecosystem can extend the benefits of Intapp’s platform to a broader range of business applications. 3 Table of Contents Low-code configurability and personalized UX Our configurable UX capabilities allow both technical and non-technical users to rapidly tailor our applications to meet their specific needs.
Historically, firms in the professional and financial services industry have either relied on internally built technology solutions and legacy on-premises software, or they have attempted to use horizontal software providers for their industry-specific technology needs.
Historically, firms in the professional and financial services industry have either relied on internally built technology solutions and legacy on-premises software, or they have attempted to use horizontal software providers to meet their industry-specific technology needs.
Our AI team has been delivering capabilities into our solutions for over 10 years, leveraging AI technology from automation to machine learning (“ML”) to deep learning to generative AI. The functions span a wide range across firm operations, including strategy, business development, risk and compliance, and work execution.
Our AI team has been delivering capabilities into our solutions for more than 10 years, leveraging AI technology from automation to machine learning (“ML”) to deep learning to generative AI. The functions span a wide range across firm operations, including strategy, business development, risk and compliance, and work execution.
We also have a team of experts who help advise on best practices and methodologies, strategize with respect to operations processes and management structure, and assess value creation and ROI from our solutions. We also have a growing partner ecosystem that includes a range of technology and implementation partners.
We also have a team of experts who help advise on best practices and methodologies, strategize with respect to operations processes and management structure, and assess value creation and return on investment from our solutions. We have a growing partner ecosystem that includes a range of technology and implementation partners.
This focus includes critical processes such as investor relations, business development, conflicts clearance and business acceptance, engagement planning and resourcing, and billing and collections. Our cloud-based delivery model also reduces firms’ operating costs by eliminating their need to own, upgrade, and support the solutions or associated hardware infrastructure. 4 Table of Contents • Manage risk and compliance more effectively.
This focus includes critical processes such as investor relations, business development, conflicts clearance and business acceptance, engagement planning and resourcing, and billing and collections. Our cloud-based delivery model also reduces firms’ operating costs by eliminating their need to own, upgrade, and support the solutions or associated hardware infrastructure. • Manage risk and compliance more effectively.
Industry-specific data architecture Our platform includes several key data management capabilities that help firms more effectively capture and leverage their critical data using a system of record that reflects the unique operating model of professional and financial services. These capabilities include: • A specialized industry graph data model.
Industry-specific data architecture Our platform includes several key data management capabilities that help firms more effectively capture and leverage their critical data using a system of record that reflects the unique operating model of our client firms. These capabilities include: • A specialized industry graph data model.
We believe our industry cloud strategy and solutions provide us with a competitive advantage, driven by our deep domain expertise gained over 20 years of serving professional and financial services firms. We have cultivated difficult-to-replicate, privileged access to these firms resulting in a deep understanding of how they work and what they need.
We believe our cloud and Applied AI strategy and solutions provide us with a competitive advantage, driven by our deep domain expertise gained over 20 years of serving these professional firms. We have cultivated difficult-to-replicate, privileged access to these firms resulting in a deep understanding of how they work and what they need.
We sell our software on a subscription basis through a direct enterprise sales model. As of June 30, 2023, we had over 2,300 clients. Our business has historically grown through a combination of expanding within our existing client base — including additional users and capabilities — and selling to new clients.
We sell our software on a subscription basis through a direct sales model. As of June 30, 2024, we had over 2,550 clients. Our business has historically grown through a combination of expanding within our existing client base — including additional users and capabilities — and selling to new clients.
Clients value our scalable platform’s differentiated domain expertise, purpose-built capabilities, comprehensive end-to-end offering, data-driven AI insights, and industry brand. We are trusted by many of the world’s elite firms, including 96 of the Am Law 100 law firms, 13 of the top 20 accounting firms, and over 1,500 private capital and investment banking firms.
Clients value our scalable platform’s differentiated domain expertise, purpose-built capabilities, comprehensive end-to-end offering, data-driven AI insights, and industry brand. We are trusted by many of the world’s elite firms, including 95 of the Am Law 100 law firms, 15 of the top 20 accounting firms, and over 1,700 private capital and investment banking firms.
Applied AI — our artificial intelligence strategy Industry-specific AI is embedded throughout our platform and solutions to help professional and financial services firms use their vast amounts of data to optimize critical processes and make better, faster decisions.
Applied AI — our artificial intelligence strategy Industry-specific AI is embedded throughout our cloud platform and solutions to help firms use their vast amounts of data to optimize critical processes and make better, faster decisions.
We are seeing increased awareness of AI among our customers who are interested in how they can leverage AI in their business, driven by the excitement around generative AI, is increasing interest in next-generation solutions such as the Intapp platform, and DealCloud in particular.
We are seeing increased awareness of AI among our clients who are interested in how they can leverage AI in their business, driven by the excitement around generative AI, is increasing interest in next-generation solutions such as the Intapp Intelligent Cloud, and DealCloud in particular.
In response to the strict security requirements of professional and financial services firms, Intapp’s software-as-a-service (“SaaS”) solutions provide tenants with enterprise-grade security, data protection, and control. In Intapp’s SaaS solutions, strict identity and access controls are employed and data is encrypted in transit and at rest.
In response to the strict security requirements of professional and financial services firms, Intapp’s SaaS solutions provide tenants with enterprise-grade security, data protection, and control. In Intapp’s SaaS solutions, strict identity and access controls are employed and data is encrypted in transit and at rest.
We cultivate a community of our executive level buyers and influencers though our advisory board system. Client Services and Client Success After a client contracts to purchase our solutions, we, either directly or together with partners, provide implementation services to assist the client in the deployment of those solutions.
We cultivate a community of our executive level buyers and influencers through our advisory board system. Client Services and Client Success After a client purchases our solutions, we, either directly or together with partners, provide implementation services to assist the client in the deployment of those solutions.
We believe our success in growing our business will depend on our ability to demonstrate to our clients in the professional and financial services industry that our solutions provide superior business outcomes to other competitive solutions — including, but not limited to, legacy applications, manual processes, horizontal platforms, and point solutions.
We believe our success in growing our business will depend on our ability to demonstrate to our clients that our solutions provide superior business outcomes to other competitive solutions — including, but not limited to, legacy applications, manual processes, horizontal platforms, and point solutions.
Our industry cloud strategy leverages deep understanding of the professional and financial services industry to deliver products on the Intapp platform that are tailored to address these firms’ specific business challenges. We combine our purpose-built technology with what we believe are best practices developed over more than 20 years and through thousands of successful deployments.
Our industry cloud strategy leverages deep understanding of the professionals across this industry to deliver products on the Intapp Intelligent Cloud platform that are tailored to address these firms’ specific business challenges. We combine our purpose-built technology with what we believe are best practices developed over more than 20 years and through thousands of successful deployments.
Intapp Integration Service includes more than 100 industry-specific connectors, as well as extensive built-in workflow and automation capabilities tailored to the unique needs of professional and financial services firms. • Market intelligence in one place .
Intapp Integration Service includes more than 100 industry-specific connectors, as well as extensive built-in workflow and automation capabilities tailored to the unique needs of professional firms. 4 Table of Contents • Market intelligence in one place .
We make available on or through our website certain reports and amendments to those reports that we file with or furnish to the SEC in accordance with the Securities Exchange Act of 1934, as amended (“Exchange Act”).
Our website address is www.intapp.com. We make available on or through our website certain reports and amendments to those reports that we file with or furnish to the SEC in accordance with the Securities Exchange Act of 1934, as amended (“Exchange Act”).
We have had success in driving clients to further adoption, and currently have 53 clients, up from 41 clients at the end of fiscal year 2022, representing a 29% increase, with contracts greater than $1 million of annual recurring revenues (“ARR”).
We have had success in driving clients to further adoption, and currently have 73 clients, up from 53 clients at the end of fiscal year 2023, representing a 38% increase, with contracts greater than $1 million of annual recurring revenues (“ARR”).
Our specialized industry data model is purpose-built to capture the complex relationships, and the specialized knowledge and experience, that are unique to professional and financial services. The platform creates “many-to-many” data linkages that connect professionals with prospective clients, investors, and target portfolio companies and assets.
Our specialized industry data model is purpose-built to capture the complex relationships, and the specialized knowledge and experience, that are unique to the firms we serve. The platform creates “many-to-many” data linkages that connect professionals with prospective clients, investors, and target portfolio companies and assets.
Industry Products and Solutions Our solutions enable private capital, investment banking, legal, accounting, and consulting firms and their professionals to realize the benefits of modern AI and cloud-based architectures for their most critical business functions — without compromising industry-specific functionality or regulatory compliance.
Industry Products and Solutions Our solutions enable accounting, consulting, investment banking, legal, private capital and real assets firms and their professionals to realize the benefits of modern AI and cloud-based architectures for their most critical business functions — without compromising industry-specific functionality or their unique client, ethical or regulatory obligations.
Together with these partners, we generate increased value for our clients and broaden our reach. Partners include specialized implementation and data partners as well as some of the largest technology players in the world, including Microsoft and KPMG.
Together with these partners, we generate increased value for our clients and broaden our reach. Partners include specialized implementation and data partners as well as some of the largest technology players in the world, including Microsoft and KPMG. Across our entire ecosystem, we now have 130 data, technology, and implementation partners.
Our solutions serve firms’ need for strong operational controls and compliance, and are complemented by solutions that support the work of the partners and professionals that grow the firms’ fees and revenues: • A deal and relationship management solution, DealCloud, that serves partners and professionals in all of our markets.
Our solutions serve firms’ need for strong operational controls and compliance, and are complemented by solutions that support the work of the partners and professionals that grow the firms’ fees and revenues: • Intapp DealCloud serves partners and professionals in all of our markets.
Collectively, more than 2,300 clients, including 96 of the Am Law 100 law firms, 13 of the top 20 accounting firms, and over 1,500 private capital and investment banking firms rely on Intapp solutions to help activate their collective knowledge, navigate complex relationships, and drive growth. No single client represented more than 10% of total revenues in fiscal year 2023.
Collectively, more than 2,550 clients, including 95 of the Am Law 100 law firms, 15 of the top 20 accounting firms, and over 1,700 private capital and investment banking firms rely on Intapp solutions to help activate their collective knowledge, navigate complex relationships, and drive growth. No single client represented more than 10% of total revenues in fiscal year 2024.
We believe that this unique opportunity will allow us to continue to attract top talent for our product development and sales efforts. As of June 30, 2023, we had 1,150 full-time employees. Our employees are primarily located in the United States, the United Kingdom, Europe, Australia, and Singapore.
We believe that this unique opportunity will allow us to continue to attract top talent for our product development and sales efforts. As of June 30, 2024, we had 1,235 full-time employees. Our employees are primarily located in the U.S., the U.K., Europe, Australia, and Singapore.
We empower the world’s premier private capital, investment banking, legal, accounting, and consulting firms with the technology they need to operate more competitively, deliver timely insights to their professionals, and meet rapidly changing client, investor, and regulatory requirements. The Intapp platform is purpose-built to modernize these firms.
We empower the world’s premier accounting, consulting, investment banking, legal, private capital and real assets firms with the technology they need to operate more competitively, deliver timely insights to their professionals, and meet rapidly changing client, investor, and regulatory requirements.
Key Benefits of Our Solution Our platform solutions help professional and financial services firms to: • Increase revenues and investment returns.
Key Benefits of Our Solutions Our platform solutions help firms to: • Increase revenues and investment returns.
In particular, we are subject to federal, state, and foreign laws regarding data protection and privacy. Foreign data protection and privacy laws and regulations can impose different obligations that may be more restrictive than those in the United States.
These may involve privacy, data protection, content, intellectual property, data collection and processing, data security, and data retention and deletion. In particular, we are subject to federal, state, and foreign laws regarding data protection and privacy. Foreign data protection and privacy laws and regulations can impose different obligations that may be more restrictive than those in the United States.
We believe that the principal competitive factors in our industry include the following: • Deep domain experience and a long-term, trusted relationship; • Product innovation, quality, functionality, and design; • Solutions that are purpose-built for this industry; • Platform solutions that are complete, end-to-end solutions across the relationship lifecycle; • Solutions that enable connectedness of key data and processes through the use of AI; • A track record of delivering value consistently over time; • A strong commitment to security and privacy; and • Brand reputation and name recognition in the industry. 7 Table of Contents Some of our competitors and potential competitors are large and have greater brand name recognition, longer operating histories, larger marketing budgets, established marketing relationships, access to larger client bases, and significantly greater resources for the development of their offerings.
We believe that the principal competitive factors in our industry include the following: • Deep domain experience and a long-term, trusted relationship; • Product innovation, quality, functionality, and design; • Solutions that are purpose-built for this industry; • Platform solutions that are complete, end-to-end solutions across the relationship lifecycle; • Solutions that enable connectedness of key data and processes through the use of AI; • A track record of delivering value consistently over time; • A strong commitment to security and privacy; and • Brand reputation and name recognition in the industry.
Our research and development team is responsible for the design, architecture, testing, and quality of our solutions. We focus our efforts on enhancing our existing solutions and developing new solutions for our clients. Our research and development teams are primarily located in Palo Alto, California; Charlotte, North Carolina; Jersey City, New Jersey; Manchester, England; and Belfast, Northern Ireland.
We focus our efforts on enhancing our existing solutions and developing new solutions for our clients. Our research and development teams are primarily located in Palo Alto, California; Charlotte, North Carolina; Belfast, Northern Ireland; Berlin, Germany and Manchester, England.
Further, certain of our competitors may challenge our intellectual property, may develop additional competing or superior technologies and processes, and compete more aggressively and sustain that competition over a longer period of time than we could. Our solutions may be rendered obsolete or uneconomical by technological advances, or by entirely different approaches developed by one or more of our competitors.
Further, certain of our competitors may challenge our intellectual property, may develop additional competing or superior technologies and processes, and compete more aggressively and sustain that competition over a longer period of time than we could.
All sales personnel focus on attracting new clients as well as expanding usage within our existing client base. Our sales team is supported by technical sales professionals and subject-matter experts who facilitate the sales process through developing and presenting demonstrations of our solutions after assessing requirements, addressing security and technical questions, and matching client needs with the appropriate solutions.
Our sales team is supported by technical sales professionals and subject-matter experts who facilitate the sales process through developing and presenting demonstrations of our solutions after assessing requirements, addressing security and technical questions, and matching client needs with the appropriate solutions.
For example, the European Union’s General Data Protection Regulation (“GDPR”) has resulted and will continue to result in significantly greater compliance burdens and costs for companies with users and operations in the European Union.
Additionally, the European Union’s General Data Protection Regulation (“GDPR”), along with the United Kingdom which also still has laws equivalent to the GDPR/EU data protection laws, has resulted and will continue to result in significantly greater compliance burdens and costs for companies with users and operations in the European Union.
Under GDPR, fines of up to 20 million Euros or up to 4% of the annual global revenues of the infringer, whichever is greater, can be imposed for violations. In addition, California adopted the California Consumer Privacy Act (“CCPA”), which went into effect on January 1, 2020, and limits how we may collect and use certain data.
Under GDPR, fines of up to 20 million Euros or up to 4% of the annual global revenues of the infringer, whichever is greater, can be imposed for violations. The California Consumer Privacy Act (“CCPA”) and the California Privacy Rights Act (“CPRA”) limit how we may collect and use certain data pertaining to California residents.
We will continue to evaluate acquisition opportunities that will help us extend our market leadership and client reach. 5 Table of Contents Our Clients Intapp is a leading provider of industry-specific, cloud-based software solutions for the global professional and financial services industry. We serve the world’s premier private capital, investment banking, legal, accounting, and consulting firms.
We will continue to evaluate acquisition opportunities that will help us extend our market leadership and client reach. Our Clients Intapp is a leading global provider of AI-powered solutions for professionals at advisory, capital markets and legal firms. We serve the world’s premier accounting, consulting, investment banking, legal, private capital, and real assets firms.
Our deep understanding of the professional and financial services industry has enabled us to develop a suite of solutions on the Intapp platform tailored to address these firms’ specific business challenges.
Our deep understanding of the professional and financial services industry has enabled us to develop a suite of solutions on the Intapp Intelligent Cloud tailored to address these firms’ specific business challenges. Intapp’s Intelligent Cloud includes the DealCloud Platform which delivers configurable capabilities to deliver the Industry Solutions purpose built for professionals.
We anticipate that we will continue to develop partnerships with a select number of third parties to help grow our business and deliver our solutions.
We anticipate that we will continue to develop partnerships with a select number of third parties to help grow our business and deliver our solutions. In those markets where we have established such partnerships, we consider these important to our and our clients’ success.
For investors, it helps increase origination volume, support investment selection, and drive greater returns. At professional services firms, DealCloud improves client strategy and targeting, business development and origination, and work delivery, increasing financial performance and regulatory compliance. The flexibility of DealCloud allows it to meet many needs including as a CRM, deal management, experience management and relationship intelligence solution.
For investors, it helps increase origination volume, support investment selection, and drive greater returns. At professional services firms, DealCloud improves client strategy and targeting, business development and origination, and work delivery, increasing financial performance and helping to ensure regulatory compliance.
DealCloud helps firms manage all aspects of their client relationships. • Risk and compliance management solutions that help firms thoroughly evaluate new business, onboard clients quickly, and monitor relationships for risk throughout their business lifecycle, while staying compliant with both regulatory and client obligations around independence and ethics. These solutions include our recent acquisition of Paragon Data Labs, Inc.
DealCloud helps firms manage all aspects of their client relationships. • Intapp Compliance solutions help firms thoroughly evaluate new business, onboard clients quickly, and monitor relationships for risk throughout their business lifecycle, while staying compliant with both regulatory and client obligations around independence and ethics. • Intapp Time solutions provide AI-enabled software to drive efficiency and profitability.
Firms in this industry operate in a highly connected ecosystem, providing valuable expertise, insight, and advice to a broad range of companies and institutions across varied transactions and engagements.
The professional and financial services industry, largely comprised of elite, partner-led firms, is one of the biggest sectors of the global economy. Firms in this industry operate in a highly connected ecosystem, providing valuable expertise, insight, and advice to a broad range of companies and institutions across varied transactions and engagements.
Information contained on, or that can be accessed through, our website does not constitute part of, and is not incorporated into, this Annual Report on Form 10-K or in any other report or document we file with the SEC.
Further corporate governance information, including our corporate governance guidelines, code of business conduct and ethics, and committee charters, is also available on our investor relations website under the heading “Corporate Governance.” Information contained on, or that can be accessed through, our website does not constitute part of, and is not incorporated into, this Annual Report on Form 10-K or in any other report or document we file with the SEC. 10 Table of Contents
We will continue to broaden our global footprint and intend to establish a presence in additional international markets. • Selectively pursue strategic transactions. We have successfully completed 9 acquisitions over the past 10 years that have allowed us to enhance our platform, add new technology capabilities, and address new client segments.
We have successfully completed 9 acquisitions over the past 10 years that have allowed us to enhance our platform, add new technology capabilities, and address new client segments.
Our Functions Sales and Marketing We currently focus on marketing and selling our solutions to professional and financial services firms in North America, Europe, the Middle East, and Asia Pacific. We seek to drive market demand by developing and delivering specific, market-focused solutions to professional and financial service firms. We primarily generate sales through a direct enterprise sales model.
Our Functions Sales and Marketing We currently focus on marketing and selling our solutions to financial and professional services firms in North America, Europe, the Middle East, and Asia Pacific.
With our scalable, modular cloud-based platform, we believe we are well positioned to continue our growth. 1 Table of Contents Our Products and Platform The Intapp platform is purpose-built to modernize these firms. The platform facilitates greater team collaboration, digitizes complex workflows to optimize deal and engagement execution, and leverages applied AI to help nurture relationships and originate new business.
With our scalable, modular cloud-based platform, we believe we are well positioned to continue our growth. 1 Table of Contents Our Products and Platform The Intapp Intelligent Cloud is purpose-built to modernize these firms.
By better connecting their most important assets — people, processes, and data — our platform helps firms increase client fees and investment returns, operate more efficiently, and better manage risk and compliance.
The platform facilitates greater team collaboration, digitizes complex workflows to optimize deal and engagement execution, and leverages applied AI to help nurture relationships and originate new business. By better connecting their most important assets — people, processes, and data — our platform helps firms increase client fees and investment returns, operate more efficiently, and better manage risk and compliance.
The Securities and Exchange Commission (“SEC”) maintains an Internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC at www.sec.gov .
Seasonality We generally experience seasonality in billings with our clients, and we typically record a higher percentage of billings in our fourth quarter than in the other quarters. 9 Table of Contents Available Information The Securities and Exchange Commission (“SEC”) maintains an Internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC at www.sec.gov .
We protect our proprietary rights through a variety of methods, including confidentiality and assignment agreements with suppliers, employees, consultants, and others who may have access to our proprietary information. 8 Table of Contents Regulations We are subject to a variety of laws and regulations in the United States and abroad that involve matters central to our business.
We own a number of registered trademarks (including Intapp and DealCloud, among others) and a portfolio of registered domain names for websites that we use in our business. We protect our proprietary rights through a variety of methods, including confidentiality and assignment agreements with suppliers, employees, consultants, and others who may have access to our proprietary information.
We have invested, and continue to invest, human and technology resources into our GDPR and CPRA compliance efforts and our data privacy compliance efforts generally. Seasonality We generally experience seasonality in billings with our clients, and we typically record a higher percentage of billings in our fourth quarter than in the other quarters.
We have invested, and continue to invest, human and technology resources into our GDPR and CPRA compliance efforts and our data privacy compliance efforts generally.
The impact of this law on us and others in our industry is and will remain unclear until additional regulations are issued. The effects of the CCPA are potentially far-reaching, however, and may require us to modify our data processing practices and policies and incur substantial compliance-related costs and expenses.
The effects of the CCPA and CPRA are potentially far-reaching, however, and may require us to modify our data processing practices and policies and incur substantial compliance-related costs and expenses. Non-compliance with these laws could result in penalties or significant legal liability.
We cannot guarantee that patents will be issued from any of our pending applications or that, if patents are issued, they will be of sufficient scope or strength to provide meaningful protection for our technology. Notwithstanding the scope of the patent protection available to us, a competitor could develop methods or devices that are not covered by our patents.
We cannot guarantee that patents will be issued from any of our pending applications or that, if patents are issued, they will be of sufficient scope or strength to provide meaningful protection for our technology. It may be necessary in the future to seek or renew licenses relating to various aspects of the Company’s products, processes and services.
Some of these laws and regulations are still evolving and being tested in courts and could be interpreted in ways that could harm our business. These may involve privacy, data protection, content, intellectual property, data collection and processing, data security, and data retention and deletion.
Regulations We are subject to a variety of laws and regulations in the United States and abroad that involve matters central to our business. Some of these laws and regulations are still evolving and being tested in courts and could be interpreted in ways that could harm our business.
Our applied AI strategy brings these advanced technologies to our clients to solve practical and unique business challenges. • Continue to lead the market shift to the cloud.
Our Applied AI strategy expands the value of our cloud offerings by incorporating recent advancements in AI. This approach helps our clients to solve practical and unique business challenges. 5 Table of Contents • Continue to lead the market shift to the cloud.
This strategy is a crucial element of our hiring and evaluation processes throughout all departments. We believe this approach produces high levels of both client success and employee engagement. We believe we provide employees with a unique opportunity to develop and sell world-class solutions within a specific industry.
We have carefully recruited, selected, and developed employees who are highly focused on delivering success for our clients in the professional and financial services industry. This strategy is a crucial element of our hiring and evaluation processes throughout all departments. We believe this approach produces high levels of both client success and employee engagement.
Item 1. B usiness. Overview Intapp is a leading provider of industry-specific, cloud-based software solutions for the global professional and financial services industry.
Item 1. B usiness. Overview Intapp is a leading global provider of AI-powered solutions for professionals at advisory, capital markets, and legal firms.
Intellectual Property We rely on a combination of patent, copyright, trademark and trade secret laws, and confidentiality and invention assignment agreements to protect our intellectual property rights. Our patents cover various aspects of the Intapp platform. The term of individual patents depends on the legal term for patents in the countries in which they are granted.
Our patents cover various aspects of the Intapp Intelligent Cloud platform. The term of individual patents depends on the legal term for patents in the countries in which they are granted. We believe the duration of our patents is adequate relative to the expected lives of our product and service offerings.
In those markets where we have established such partnerships, we consider these important to our and our clients’ success. 6 Table of Contents Research and Development Our ability to compete depends in large part on our continuous commitment to research and development and our ability to rapidly introduce new technologies, features, and functionality.
Research and Development Our ability to compete depends in large part on our continuous commitment to research and development and our ability to rapidly introduce new technologies, features, and functionality. Our research and development team is responsible for the design, architecture, testing, and quality of our solutions.
These solutions include time management and billing software, such as our recently acquired Billstream product, which helps accelerate billing, improve realization, and improve the experience for the firm’s clients. • Collaboration solutions that provide intelligent client-centric collaboration, seamless content governance, and innovative client experiences leveraging Microsoft 365, Teams, and SharePoint. • Integration solutions that connect all firm data into a single platform, tailored to the needs of professional and financial services firms.
These solutions include time management software that accelerates billing, improves realization, and improves the experience for the firm’s clients. • Intapp Collaboration solutions provide intelligent client-centric collaboration, seamless content governance, and innovative client experiences leveraging Microsoft 365, Teams, and SharePoint. These capabilities have been extended through the recent acquisition of Transform Data International B.V.
We also provide solutions that extend the value of our platform with third-party data that we are licensed to resell from a broad number of providers. Technology Platform Our solutions are built on a single cloud platform, taking advantage of capabilities tailor-made for the unique requirements of the industries we serve.
Intapp Assist leverages the unique client data in the Intapp Intelligent Cloud and applies Generative AI to power business development, reduce manual work and help professionals make better-informed, faster decisions. Technology Platform Our solutions are built on a cloud platform, taking advantage of capabilities tailor-made for the unique requirements of the industries we serve.
We also utilize a substantial number of independent contractors and consultants working in research and development throughout the world. Prior to Russia’s invasion of Ukraine in February 2022, a majority of our research and development had been conducted through our facilities based in Ukraine and our contractors’ facilities located in Belarus, Ukraine, and Russia.
We also utilize a substantial number of independent contractors and consultants working in research and development throughout the world. 7 Table of Contents Our Employees and Human Capital We have built our culture around the success of our clients, our partners, our employees, and our investors.
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The platform facilitates better team collaboration, digitizes complex workflows to optimize deal and engagement execution, and leverages applied AI to help nurture relationships and originate new business. The Intapp platform allows firms to manage their unique risk and compliance challenges, such as conflicts and independence, ethical walls, and employee compliance.
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Using the power of Applied AI, our purpose-built vertical software as a service (“SaaS”) solutions accelerate the flow of information firmwide, activate expertise, empower teams, strengthen client relationships, manage risk, and help firms adapt more quickly in a highly complex ecosystem.
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By better connecting their most important assets — people, processes, and data — our platform helps firms increase client fees and investment returns, operate more efficiently, and better manage risk and compliance. The professional and financial services industry, largely comprised of elite, partner-led firms, is one of the biggest sectors of the global economy.
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Delivered in combination with our Compliance, Time, and Collaboration products, our DealCloud Platform provides a comprehensive solution for our clients and their firms. Our AI capabilities are similarly tailored, with security and compliance features that help ensure critical firm and client data is only shared when, where, and with whom it should be.
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(“Paragon”), which complements our solution that protects firms, and delivers our Employee Compliance solution to help firms ensure personal independence for their professionals and manage and track material non-public information (“MNPI”), trading restrictions, and other business conflicts of interest. • Operational and financial management solutions that provide AI-enabled software to drive efficiency and profitability.
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Our clients deliver value by leveraging their expertise, relationships, and experience. By its very nature, their work involves compiling inputs from vast sources of data and generating informed opinions that drive action. We believe these firms and their professionals are uniquely positioned to benefit from the promise of generative AI.
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For example, we acquired DealCloud in 2018 to better target private capital and investment banking clients with cloud-based deal management, pipeline management, and CRM functionalities.
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The Intapp Intelligent Cloud helps firms move fast, modernize operations, and win more business with tailored cloud-based solutions that help them apply their intelligence to deliver value for their clients.
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We have been recognized in our Microsoft partnership as a Top Tier ISV Partner, the highest level, showing the importance of Intapp in how they serve our markets. Across our entire ecosystem, we now have over 100 data, technology, and implementation partners.
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The flexibility of DealCloud allows it to meet many needs including as a customer relationship management (“CRM”), deal management, experience management and relationship intelligence solution.
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Beginning in March 2022, in response to Russia’s invasion of Ukraine, we have transitioned and relocated all of our development and services functions previously located in Russia and Belarus to facilities and resources in the European Union, U.K., and Americas, outside of the conflict zone.
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(“TDI”), which deepens the integration with Microsoft 365 applications and applies AI to everyday tasks and supports modern ways of working. • Intapp Integration solutions connect all firm data into a single platform, tailored to the needs of professional and financial services firms.
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Our Employees and Human Capital We have built our culture around the success of our clients, our partners, our employees, and our investors. We have carefully recruited, selected, and developed employees who are highly focused on delivering success for our clients in the professional and financial services industry.
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We also provide solutions that extend the value of our platform with third-party data that we are licensed to resell from a broad number of providers. 2 Table of Contents • Intapp Assist integrates Generative AI into everyday workflows to save professionals time by generating deal, company and meeting summaries and creating relevant, personalized signals that help professionals better harness the firm’s intelligence.
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As more companies develop new intellectual property in our market, there is the possibility of a competitor acquiring patents or other rights that may limit our ability to update our technologies and products, which may impact demand for our products.
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Combined with our market expertise, our solutions help firms compete by better applying their intelligence while providing a Trusted AI approach to data security that meets the complex compliance needs of professional firms; • Intapp Data unlocks valuable relationship intelligence with a rich data set of companies and contact data and delivering more valued integrations with our broad set of third-party data integrations; and, • A specialized architecture based on an industry graph data model that is purpose-built to capture professional and financial services firms’ unique operating model — supporting the complex integrations needed to deliver data where and when it is needed.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeIn addition, if we are unable to successfully grow our SaaS solutions business or navigate our growth strategy, our results of operations could be harmed. • If we are unable to develop, introduce and market new and enhanced versions of our solutions, we may be put at a competitive disadvantage and our operating results could be adversely affected. • We are expanding our AI offerings to incorporate recent innovations in AI and these initiatives may not be successful, which may adversely affect our business, results of operations and financial condition, and may also result in reputational harm and liability. • If the market for SaaS solutions for professional and financial services develops slower than we expect or declines, it could have a material adverse effect on our business, financial condition and results of operations. • Our estimates of certain operational metrics are subject to inherent challenges in measurement. • If we are unable to develop or sell our solutions into new markets or to further penetrate existing markets, our revenues will not grow as expected and our operating results could be adversely affected. • We compete in highly competitive markets, and if we do not compete effectively, our business, results of operations, and financial condition could be negatively impacted and cause our market share to decline. 10 Table of Contents • We may continue to expand through acquisitions or partnerships with other companies, which may divert our management’s attention and result in unexpected operating and technology integration difficulties, increased costs, and dilution to our stockholders. • If we fail to effectively manage our growth, our business and results of operations could be harmed. • Our solutions address functions within the heavily regulated professional and financial services industry, and our clients’ failure to comply with applicable laws and regulations could subject us to litigation. • Our solutions or pricing models may not accurately reflect the optimal pricing necessary to attract new clients and retain existing clients as the market matures. • We have in the past, and may in the future, incur indebtedness that could adversely affect our financial flexibility and expose us to risks that could materially adversely affect our liquidity and financial condition. • Failure of any of our established solutions to satisfy client demands or to maintain market acceptance would harm our business, results of operations, financial condition, and growth prospects. • Assertions against us, by third parties alleging infringement or other violation of their intellectual property rights, could result in significant costs and substantially harm our business and results of operations. • Failure to protect our intellectual property could substantially harm our business and results of operations. • If we fail to maintain an effective system of internal controls, our ability to produce timely and accurate financial statements or comply with applicable regulations could be impaired. • Our international sales and operations subject us to additional risks that can adversely affect our business, results of operations and financial condition. • Failure to comply with the GDPR or other data privacy regimes could subject us to liability, fines and reputational harm. • If the ownership of our common stock continues to be highly concentrated, it may prevent other minority stockholders from influencing significant corporate decisions and may result in conflicts of interest. • The market price and trading volume of our common stock has been and may continue to be volatile, which could result in rapid and substantial losses for our stockholders. • The market price of our common stock could be negatively affected by sales of substantial amounts of our common stock in the public markets. • Adverse developments affecting the financial services industry could have an adverse impact on our business operations, financial condition, and results of operations. • Outbreaks, epidemics, or pandemics involving public health could harm our business, results of operations, and financial condition. 11 Table of Contents Risks Related to Our Business and Industry Our rapid growth makes it difficult to evaluate our future prospects and may increase the risk that we will not continue to grow at or near historical rates.
Biggest changeA decline in our client renewals and expansions could harm our future results of operations. • Because we recognize revenues from our SaaS solutions over the term of the agreements for our subscriptions, a significant downturn in our business may not be reflected immediately in our operating results, which increases the difficulty of evaluating our future financial performance. • Our sales cycles are lengthy and variable, depend upon factors outside our control, and could cause us to expend significant time and resources prior to generating revenues. • We are expanding our SaaS solutions to incorporate recent innovations in AI and these initiatives may not be successful, which may adversely affect our business, results of operations and financial condition, and may also result in reputational harm and liability. • If we are unable to develop, introduce and market new and enhanced versions of our solutions, we may be put at a competitive disadvantage and our operating results could be adversely affected. • If we are unable to develop or sell our solutions into new markets or to further penetrate existing markets, our revenues will not grow as expected and our operating results could be adversely affected. • We compete in highly competitive markets, and if we do not compete effectively, our business, results of operations, and financial condition could be negatively impacted and cause our market share to decline. • If the market for SaaS solutions for professional and financial services develops slower than we expect or declines, it could have a material adverse effect on our business, financial condition and results of operations. • We may continue to expand through acquisitions or partnerships with other companies, which may divert our management’s attention and result in unexpected operating and technology integration difficulties, increased costs, and dilution to our stockholders. • If we fail to effectively manage our growth, our business and results of operations could be harmed. • Our solutions address functions within the heavily regulated professional and financial services industry, and our clients’ failure to comply with applicable laws and regulations could subject us to litigation. 11 Table of Contents • Our solutions or pricing models may not accurately reflect the optimal pricing necessary to attract new clients and retain existing clients as the market matures. • Our loan and security agreement provides our lender with a first-priority lien against substantially all of our assets and contains restrictive covenants which could limit our operational flexibility and otherwise adversely affect our financial condition. • Failure of any of our established solutions to satisfy client demands or to maintain market acceptance would harm our business, results of operations, financial condition, and growth prospects. • Our ability to sell and renew our solutions is dependent in part on the quality of our implementation services and technical support services and the implementation services provided by our partners, and our failure to offer high-quality implementation services or technical support services or our partners’ failure to offering high-quality implementation services could damage our reputation and adversely affect our ability to sell our solutions to new clients and renew agreements with our existing clients. • Real or perceived errors or failures in our solutions may affect our reputation, cause us to lose clients and reduce sales which may harm our business and results of operations. • Changes in laws, regulations, or guidance issued by supervisory authorities relating to privacy or the protection or transfer of personal data, or any actual or perceived failure by us to comply with such laws, regulations, or guidance, could adversely affect our business and could subject us to liability, fines and reputational harm. • Assertions against us, by third parties alleging infringement or other violation of their intellectual property rights, could result in significant costs and substantially harm our business and results of operations. • Failure to protect our intellectual property could substantially harm our business and results of operations. • We and our clients rely on technology and intellectual property of third parties, and any errors or defects in, or any unavailability of, such technology and intellectual property could limit the functionality of our solutions and disrupt our business. • We agree to indemnify clients and other third parties, which exposes us to substantial potential liability. • If we fail to maintain an effective system of internal controls, our ability to produce timely and accurate financial statements or comply with applicable regulations could be impaired. • Our international sales and operations subject us to additional risks that can adversely affect our business, results of operations and financial condition. • If the ownership of our common stock continues to be highly concentrated, it may prevent other minority stockholders from influencing significant corporate decisions and may result in conflicts of interest. • The market price and trading volume of our common stock has been and may continue to be volatile, which could result in rapid and substantial losses for our stockholders. • Future offerings of debt or equity securities by us may materially adversely affect the market price of our common stock. • The market price of our common stock could be negatively affected by sales of substantial amounts of our common stock in the public markets. • We may be adversely affected by natural disasters, outbreaks, epidemics, or pandemics involving public health, other catastrophic events and terrorism that could disrupt and harm our business, results of operations, and financial condition. 12 Table of Contents Risks Related to Our Business and Industry Our rapid growth makes it difficult to evaluate our future prospects and may increase the risk that we will not continue to grow at or near historical rates.
It is critical to our success for us to anticipate changes in technology, industry standards, and client requirements and to successfully introduce new, enhanced, and competitive solutions to meet our clients’ and prospective clients’ needs on a timely basis. We have invested and intend to continue to make significant investments in research and development to meet these challenges.
It is critical to our success for us to anticipate changes in technology, industry standards, regulations and client requirements and to successfully introduce new, enhanced, and competitive solutions to meet our clients’ and prospective clients’ needs on a timely basis. We have invested and intend to continue to make significant investments in research and development to meet these challenges.
We invest a substantial amount of time and resources on our sales efforts without any assurance that our efforts will produce sales. Even if we succeed at completing a sale, we may be unable to predict the size of an initial subscription arrangement until very late in the sales cycle.
We invest a substantial amount of time and resources in our sales efforts without any assurance that our efforts will produce sales. Even if we succeed at completing a sale, we may be unable to predict the size of an initial subscription arrangement until very late in the sales cycle.
We use technology and intellectual property licensed from unaffiliated third parties in certain of our solutions, and we may license additional third-party technology and intellectual property in the future. We have experienced, and may continue to experience, errors or defects in this third-party technology and intellectual property that result in errors that could harm our brand and business.
We use technology and intellectual property licensed from unaffiliated third parties internally and in certain of our solutions, and we may license additional third-party technology and intellectual property in the future. We have experienced, and may continue to experience, errors or defects in this third-party technology and intellectual property that result in errors that could harm our brand and business.
We may also experience hesitancy, reluctance, or refusal by European or multi-national clients to continue to use some of our services due to the potential risk exposure of personal data transfers and the current data protection obligations imposed on them by certain data protection authorities.
We may experience hesitancy, reluctance, or refusal by European or multi-national clients to continue to use some of our services due to the potential risk exposure of personal data transfers and the current data protection obligations imposed on them by certain data protection authorities.
In the event that portions of our proprietary technology are determined to be subject to an open source license, we could be required to publicly release the affected portions of our source code, re-engineer all or a portion of our technologies, or otherwise be limited in the licensing of our technologies, each of which could reduce or eliminate the value of our services and technologies and materially and adversely affect our business, results of operations and prospects. 31 Table of Contents We may experience fluctuations in foreign currency exchange rates that could adversely impact our results of operations.
In the event that portions of our proprietary technology are determined to be subject to an open source license, we could be required to publicly release the affected portions of our source code, re-engineer all or a portion of our technologies, or otherwise be limited in the licensing of our technologies, each of which could reduce or eliminate the value of our services and technologies and materially and adversely affect our business, results of operations and prospects. 31 Table of Contents We may experience fluctuations in foreign currency exchange rates that could adversely impact our results of operations and financial condition.
A decline in our client renewals and expansions could harm our future results of operations. Our software solutions are provided on a subscription basis, with subscription terms varying from one to three years.
A decline in our client renewals and expansions could harm our future results of operations. Our software solutions are provided on a subscription basis, with subscription terms typically varying from one to three years.
Also, changes in general economic and market conditions, including economic uncertainty, inflation, liquidity concerns and fluctuating interest rates, have resulted in and could continue to result in stress and volatility in the financial services industry.
Changes in general economic and market conditions, including economic uncertainty, inflation, liquidity concerns and fluctuating interest rates, have resulted in and could continue to result in stress and volatility in the financial services industry.
In future periods, our revenues could grow more slowly than in recent periods or decline for a number of reasons, including any reduction in demand for our Intapp platform, increase in competition, limited ability to, or our decision not to, increase pricing, or our failure to capitalize on growth opportunities or if any of the other risks described herein were to materialize.
In future periods, our revenues could grow more slowly than in recent periods or decline for a number of reasons, including any reduction in demand for our Intapp Intelligent Cloud platform, increase in competition, limited ability to, or our decision not to, increase pricing, or our failure to capitalize on growth opportunities or if any of the other risks described herein were to materialize.
For instance, if a potential client uses one product from a competitor that powers a critical element of the client’s day-to-day operations, they may be more likely to turn to such competitor in the future to the extent they require further product solutions, rather than purchasing one or more solutions from the Intapp platform.
For instance, if a potential client uses one product from a competitor that powers a critical element of the client’s day-to-day operations, they may be more likely to turn to such competitor in the future to the extent they require further product solutions, rather than purchasing one or more solutions from the Intapp Intelligent Cloud platform.
As a result, Anderson and Great Hill exercise significant influence over all matters requiring a stockholder vote, including: the election of directors; mergers, and acquisitions; the sale of all or substantially all of our assets and other decisions affecting our capital structure; the amendment of our amended and restated certificate of incorporation and our amended and restated bylaws; and our winding up and dissolution.
As a result, Anderson exercise significant influence over all matters requiring a stockholder vote, including: the election of directors; mergers, and acquisitions; the sale of all or substantially all of our assets and other decisions affecting our capital structure; the amendment of our amended and restated certificate of incorporation and our amended and restated bylaws; and our winding up and dissolution.
Our ability to attract new clients and increase revenues from our existing clients depends, in part, on our continued ability to enhance the functionality of the existing solutions on the Intapp platform by developing, introducing, and marketing new and enhanced versions of our solutions that address the evolving needs of our clients and changing industry standards.
Our ability to attract new clients and increase revenues from our existing clients depends, in part, on our continued ability to enhance the functionality of the existing solutions on the Intapp Intelligent Cloud platform by developing, introducing, and marketing new and enhanced versions of our solutions that address the evolving needs of our clients and changing industry standards.
Some of the factors that have or could in the future negatively affect our share price or result in fluctuations in the price or trading volume of our common stock, many of which are beyond our control, include: • variations in our quarterly or annual operating results; • our ability to attract new clients in both domestic and international markets, and our ability expand the solutions provided to existing clients; • the timing of our clients’ buying decisions and reductions in our clients’ budgets for IT purchases and delays in their purchasing cycles, particularly in light of recent adverse global economic conditions; • changes in our earnings estimates (if provided) or differences between our actual financial and operating results and those expected by investors and analysts; • the contents of published research reports about us or our industry or the failure of securities analysts to cover our common stock; • additions to, or departures of, key management personnel and our ability to attract, train, integrate and retain highly skilled employees; • any increased indebtedness we may incur in the future; • announcements and public filings by us or others and developments affecting us; • actions by institutional stockholders; • litigation and governmental investigations; 33 Table of Contents • operating and stock performance of other companies that investors deem comparable to us (and changes in their market valuations) and overall performance of the equity markets; • speculation or reports by the press or investment community with respect to us or our industry in general; • increases in market interest rates, including due to impacts from inflation, that may lead purchasers of our shares to demand a higher yield; • announcements by us or our competitors of significant contracts, acquisitions, dispositions, strategic relationships, joint ventures or capital commitments; • announcements or actions taken by Anderson or Great Hill as our principal stockholders; • sales of substantial amounts of our common stock by Anderson, Great Hill or other significant stockholders or our insiders, or the expectation that such sales might occur; • volatility, inflation, or economic downturns in the markets in which we, our clients and our partners are located caused by outbreaks, epidemics, or pandemics involving public health and related policies and restrictions undertaken to contain the spread of such pandemics or potential pandemics; • geopolitical tensions or conflicts in locations in which we, our clients and our partners are located, including Russian military action against Ukraine and any further escalation of such conflict; • general volatility in the prices of stock traded on the Nasdaq Global Select Market and other equity markets; and • general market, political and economic conditions, including inflation, rising interest rates and disruptions in the professional and financial services industry, including any such conditions and local conditions in the markets in which any of our clients are located.
Some of the factors that have or could in the future negatively affect our share price or result in fluctuations in the price or trading volume of our common stock, many of which are beyond our control, include: • variations in our quarterly or annual operating results; • our ability to attract new clients in both domestic and international markets, and our ability expand the solutions provided to existing clients; • the timing of our clients’ buying decisions and reductions in our clients’ budgets for IT purchases and delays in their purchasing cycles, particularly in light of recent adverse global economic conditions; • changes in our earnings estimates (if provided) or differences between our actual financial and operating results and those expected by investors and analysts; • the contents of published research reports about us or our industry or the failure of securities analysts to cover our common stock; • additions to, or departures of, key management personnel and our ability to attract, train, integrate and retain highly skilled employees; • any increased indebtedness we may incur in the future; • announcements and public filings by us or others and developments affecting us; • actions by institutional stockholders; • litigation and governmental investigations; • operating and stock performance of other companies that investors deem comparable to us (and changes in their market valuations) and overall performance of the equity markets; • speculation or reports by the press or investment community with respect to us or our industry in general; • increases in market interest rates, including due to impacts from inflation, that may lead purchasers of our shares to demand a higher yield; • announcements by us or our competitors of significant contracts, acquisitions, dispositions, strategic relationships, joint ventures or capital commitments; • announcements or actions taken by our principal stockholders; • sales of substantial amounts of our common stock by Anderson or other significant stockholders or our insiders, or the expectation that such sales might occur; • volatility, inflation, or economic downturns in the markets in which we, our clients and our partners are located caused by outbreaks, epidemics, or pandemics involving public health and related policies and restrictions undertaken to contain the spread of such pandemics or potential pandemics; • geopolitical tensions or conflicts in locations in which we, our clients and our partners are located, including Russian military action against Ukraine and any further escalation of such conflict as well as ongoing conflict in the Middle East; • general volatility in the prices of stock traded on the Nasdaq Global Select Market and other equity markets; and • general market, political and economic conditions, including inflation, rising interest rates and disruptions in the professional and financial services industry, including any such conditions and local conditions in the markets in which any of our clients are located. 34 Table of Contents The stock markets have experienced price and volume fluctuations that have affected and continue to affect the market prices of equity securities of many technology companies.
Our ability to increase revenues will depend, in large part, on our ability to further penetrate our existing markets and to attract new clients, as well as our ability to generate subscription renewals from existing clients and to increase sales from existing clients who do not utilize the full Intapp platform.
Our ability to increase revenues will depend, in large part, on our ability to further penetrate our existing markets and to attract new clients, as well as our ability to generate subscription renewals from existing clients and to increase sales from existing clients who do not utilize the full Intapp Intelligent Cloud platform.
Bribery Act and other anti-corruption regulations, particularly in emerging market countries; • compliance by international staff with accounting practices generally accepted in the United States, including adherence to our accounting policies and internal controls; • import and export license requirements, tariffs, trade agreements, taxes, and other trade barriers; • increased financial accounting and reporting burdens and complexities; • weaker protection of intellectual property rights in some countries; • multiple and possibly overlapping tax regimes; • the application of the respective local laws and regulations to our business in each of the jurisdictions in which we operate and associated legal expenses; • government sanctions that may interfere with our ability to sell into particular countries; • disruption to our operations caused by epidemics, pandemics or outbreaks; and • political, social, and economic instability abroad, including Russia’s invasion of Ukraine, terrorist attacks, and security concerns in general.
Bribery Act and other anti-corruption regulations, particularly in emerging market countries; • compliance by international staff with accounting practices generally accepted in the United States, including adherence to our accounting policies and internal controls; • import and export license requirements, tariffs, trade agreements, taxes, and other trade barriers; • increased financial accounting and reporting burdens and complexities; • weaker protection of intellectual property rights in some countries; • multiple and possibly overlapping tax regimes; • the application of the respective local laws and regulations to our business in each of the jurisdictions in which we operate and associated legal expenses; • government sanctions that may interfere with our ability to sell into particular countries; • disruption to our operations caused by epidemics, pandemics or outbreaks; and • political, social, and economic instability abroad, including geopolitical and regional conflicts, terrorist attacks, and security concerns in general.
For example, a decision of the Court of Justice of the European Union in July 2020 invalidated the EU-US Privacy Shield Framework, a means that previously permitted transfers of personal data from the EEA to companies in the United States that certified adherence to the Privacy Shield Framework.
A decision of the Court of Justice of the European Union in July 2020 invalidated the EU-US Privacy Shield Framework, a means that previously permitted transfers of personal data from the EEA to companies in the United States that certified adherence to the Privacy Shield Framework.
These provisions may make it difficult and expensive for a third-party to pursue a tender offer, change in control or takeover attempt that is opposed by Anderson, Great Hill, our management or our board of directors.
These provisions may make it difficult and expensive for a third-party to pursue a tender offer, change in control or takeover attempt that is opposed by Anderson, our management or our board of directors.
We have an AI strategy to further expand and embed industry-specific AI throughout the Intapp platform and our solutions to help our clients more effectively use their data to manage risk, enhance efficiency and improve operations.
We have an AI strategy to further expand and embed industry-specific AI throughout the Intapp Intelligent Cloud platform and our solutions to help our clients more effectively use their data to manage risk, enhance efficiency and improve operations.
Moreover, in addition to our failure to realize the anticipated benefits of any acquisition, including our revenues or return on investment assumptions, we may be exposed to unknown liabilities or impairment charges as a result of acquisitions we do complete. 19 Table of Contents If we fail to effectively manage our growth, our business and results of operations could be harmed.
Moreover, in addition to our failure to realize the anticipated benefits of any acquisition, including our revenues or return on investment assumptions, we may be exposed to unknown liabilities or impairment charges as a result of acquisitions we do complete. If we fail to effectively manage our growth, our business and results of operations could be harmed.
We plan to continue to expand our international presence in the future, which will place additional demands on our resources and operations. Additionally, we continue to increase the breadth and scope of our Intapp platform and our operations and continue to develop our partner network.
We plan to continue to expand our international presence in the future, which will place additional demands on our resources and operations. Additionally, we continue to increase the breadth and scope of our Intapp Intelligent Cloud platform and our operations and continue to develop our partner network.
Any future impairment of our goodwill or intangible or other long-lived assets could have an adverse effect on our financial condition and results of operations. Acquisitions and alliances may also disrupt our ongoing business, divert our resources and require significant management attention that would otherwise be available for ongoing development of our current business.
Any future impairment of our goodwill or intangible or other long-lived assets could have an adverse effect on our financial condition and results of operations. 19 Table of Contents Acquisitions and alliances may also disrupt our ongoing business, divert our resources and require significant management attention that would otherwise be available for ongoing development of our current business.
The effects of climate change may further disrupt our clients’ businesses, by, among other things, increasing their costs and credit risk from their customers. Additionally, our market verticals are also interdependent.
The effects of climate change may further disrupt our clients’ businesses, by, among other things, increasing their costs and credit risk from their clients. Additionally, our market verticals are also interdependent.
If adequate funds are not available or are not available on acceptable terms, when we desire them, our ability to fund our operations, take advantage of unanticipated opportunities, develop or enhance our solutions, invest in future growth opportunities or otherwise respond to competitive pressures would be significantly limited. Any of these factors could harm our results of operations.
If adequate funds are not available or are not available on acceptable terms, when we desire them, our ability to fund our operations, develop or enhance our solutions, invest in future growth opportunities or otherwise respond to competitive pressures would be significantly limited. Any of these factors could harm our results of operations.
Disruptions in communications with these resources could also lead to periods of unavailability of our SaaS solutions, which could require us to provide credits or refunds to clients or lead to client cancellations. 27 Table of Contents Additionally, we engage through third parties a significant number of independent contractors in our research and development efforts.
Disruptions in communications with these resources could also lead to periods of unavailability of our SaaS solutions, which could require us to provide credits or refunds to clients or lead to client cancellations. Additionally, we engage through third parties a significant number of independent contractors in our research and development efforts.
Further, our sales cycles could increase, resulting in a slower growth of new sales. Certain of our competitors may also be better equipped to weather the impact of such outbreaks, epidemics, or pandemics involving public health, including COVID-19 outbreaks both domestically and abroad and better able to address changes in client demand.
Further, our sales cycles could increase, resulting in a slower growth of new sales. Certain of our competitors may also be better equipped to weather the impact of such outbreaks, epidemics, or pandemics involving public health both domestically and abroad and better able to address changes in client demand.
Our risks are likely to increase as we continue to expand our platform, grow our client base, and process, store, and transmit increasingly large amounts of confidential and sensitive data, and as cyber security threats continue to grow increasingly sophisticated and complex. 14 Table of Contents Our business depends on clients renewing and expanding their subscriptions for our solutions.
Our risks are likely to increase as we continue to expand our platform, grow our client base, and process, store, and transmit increasingly large amounts of confidential and sensitive data, and as cyber security threats continue to grow increasingly sophisticated and complex. Our business depends on clients renewing and expanding their subscriptions for our solutions.
It is possible that these conditions may persist, deteriorate or reoccur, which may cause our customers to reduce their spending on our technology or to seek to terminate or renegotiate their contracts with us.
It is possible that these conditions may persist, deteriorate or reoccur, which may cause our clients to reduce their spending on our technology or to seek to terminate or renegotiate their contracts with us.
In addition, this concentration of share ownership may adversely affect the trading price of our common stock because investors may perceive disadvantages in owning shares in a company with significant stockholders.
In addition, this concentration of share ownership may adversely affect the trading price of our common stock because investors may perceive disadvantages in owning shares in a company with a significant stockholder.
In some cases, we receive subscription fees from the provision of such third-party technology to our clients, and the loss of the right to distribute such technology could negatively impact revenues. We agree to indemnify clients and other third parties, which exposes us to substantial potential liability.
In some cases, we receive subscription fees from the provision of such third-party technology to our clients, and the loss of the right to distribute such technology could negatively impact revenues. 26 Table of Contents We agree to indemnify clients and other third parties, which exposes us to substantial potential liability.
This concentration of ownership may delay, deter or prevent acts that would be favored by our other stockholders. The interests of Anderson and Great Hill may not always coincide with our interests or the interests of our other stockholders. This concentration of ownership may also have the effect of delaying, preventing or deterring a change in control of us.
This concentration of ownership may delay, deter or prevent acts that would be favored by our other stockholders. The interests of Anderson may not always coincide with our interests or the interests of our other stockholders. This concentration of ownership may also have the effect of delaying, preventing or deterring a change in control of us.
For example, during fiscal year 2023, we exited a portion of our space in Palo Alto, California and recorded a net charge of $1.6 million in connection with the impairment of the related operating lease right-of-use asset and the reassessment of the lease liability.
Also, during fiscal year 2023, we exited a portion of our space in Palo Alto, California and recorded a net charge of $1.6 million in connection with the impairment of the related operating lease right-of-use asset and the reassessment of the lease liability.
Moreover, significant and unforeseen changes in foreign currency exchange rates may cause us to fail to achieve our stated projections for revenues and operating income, which could have an adverse effect on our stock price. We will continue to experience fluctuations in foreign currency exchange rates, which, if material, may harm our revenues or results of operations.
Moreover, significant and unforeseen changes in foreign currency exchange rates may cause us to fail to achieve our stated projections for revenues and operating income, which could have an adverse effect on our stock price. We will continue to experience fluctuations in foreign currency exchange rates, which, if material, may harm our results of operations or financial condition. Our U.S.
Thus, holders of our common stock bear the risk that our future offerings may reduce the market price of our common stock and dilute their stockholdings in us. 34 Table of Contents The market price of our common stock could be negatively affected by sales of substantial amounts of our common stock in the public markets.
Thus, holders of our common stock bear the risk that our future offerings may reduce the market price of our common stock and dilute their stockholdings in us. The market price of our common stock could be negatively affected by sales of substantial amounts of our common stock in the public markets.
Any of these events will increase the complexity and costs of processing personal data in the European Economic Area or concerning individuals located in the European Economic Area.
Any of these events will increase the complexity and costs of processing personal data in the UK or European Economic Area or concerning individuals located in the UK or European Economic Area (“EEA”).
We have experienced, and may continue to experience, rapid growth, which has placed, and may continue to place, significant demands on our management and our operational and financial resources. We operate globally, sell our services to more than 2,300 clients in more than 40 countries, and have employees and contractors in the Americas, Europe and Asia Pacific.
We have experienced, and may continue to experience, rapid growth, which has placed, and may continue to place, significant demands on our management and our operational and financial resources. We operate globally, sell our services to more than 2,550 clients in more than 55 countries, and have employees and contractors in the Americas, Europe and Asia Pacific.
The use of our AI capabilities could raise ethical or social concerns and our failure to adequately address these concerns or the failure of our competitors, clients or other end users to do so could negatively impact our brand and reputation.
The use of our AI capabilities could raise ethical or social 16 Table of Contents concerns and our failure to adequately address these concerns or the failure of our competitors, clients or other end users to do so could negatively impact our brand and reputation.
By contrast, a non-renewal occurring early in a quarter may have a significant negative impact on revenues from our SaaS solutions for that quarter and we may not be able to offset a decline in such revenues with revenues from new contracts entered into in the same quarter.
By contrast, a non-renewal occurring early in a quarter may have a significant negative impact on revenues from our SaaS solutions for that quarter and we may not be able to offset a decline in such revenues with revenues from new contracts 15 Table of Contents entered into in the same quarter.
We expect to continue to derive a substantial portion of our revenues from these sources. As such, continued market acceptance of these solutions is critical to our growth and success.
We derive our revenues and cash flows from our established solutions. We expect to continue to derive a substantial portion of our revenues from these sources. As such, continued market acceptance of these solutions is critical to our growth and success.
We may be subject to lawsuits that, even if unsuccessful, could divert our resources and our management’s attention and adversely affect our business, and our insurance coverage may exclude coverage for some claims or may not be sufficient to cover such claims against us.
We may be subject to lawsuits that, even if unsuccessful, 20 Table of Contents could divert our resources and our management’s attention and adversely affect our business, and our insurance coverage may exclude coverage for some claims or may not be sufficient to cover such claims against us.
Also, Anderson and Great Hill may each seek to cause us to take courses of action that, in its judgment, could enhance its investment in us, but which might involve risks to our other stockholders or adversely affect us or our other stockholders.
Also, Anderson may seek to cause us to take courses of action that, in its judgment, could enhance its investment in us, but which might involve risks to our other stockholders or adversely affect us or our other stockholders.
Risk of cyberattacks continues to grow as cybersecurity threats become more sophisticated and complex and geopolitical tensions or conflicts, such as Russia’s invasion of Ukraine, may create a heightened risk of cyberattacks. Like most companies that provide cloud-based software solutions, we are, in the normal course of business, the target of malicious cyberattack attempts.
Risk of cyberattacks including ransomware, continues to grow as cybersecurity threats become more sophisticated and complex and geopolitical tensions or conflicts, may create a heightened risk of cyberattacks. Like most companies that provide cloud-based software solutions, we are, in the normal course of business, the target of malicious cyberattack attempts.
All of our revenues are generated by sales to clients in our targeted verticals, and factors, including the downturn in U.S. and global markets and economic conditions, that adversely affect the applicable industry could also adversely affect our business. Currently, all of our sales are to clients in the professional and financial services industry.
All of our revenues are generated by sales to clients in our targeted verticals, and factors, including the downturns in U.S. and global markets and economic conditions, that adversely affect the applicable industry could also adversely affect our business. A majority of our sales are to clients in the professional and financial services industry.
Our current competitors include large solution providers that focus on one or more point solutions, legacy systems, and manual processes developed by or for our clients, new or emerging entrants seeking to develop competing technologies and well-established horizontal solution providers that provide broad solutions across multiple verticals.
Our current competitors include large solution providers that focus on one or more point solutions, legacy systems, and manual processes developed by or for our clients, new or emerging entrants seeking to develop competing technologies, including those with AI and generative AI capabilities, and well-established horizontal solution providers that provide broad solutions across multiple verticals.
If we raise additional funds through the issuance of equity or convertible debt securities, the percentage ownership of our stockholders could be significantly diluted, and newly-issued securities may have rights, preferences, or privileges senior to those of existing stockholders.
If we raise additional funds through the issuance of equity or securities convertible into shares of our common stock, the percentage ownership of our stockholders could be significantly diluted, and newly-issued securities may have rights, preferences, or privileges senior to those of existing stockholders.
Our organizational structure is also becoming more complex as we grow our operational, financial, and management infrastructure and we must continue to improve our internal controls as well as our reporting systems and procedures.
Our organizational structure is also becoming more complex as we grow our operational, financial, and management infrastructure and we must continue to improve our internal control over financial reporting as well as our disclosure systems and procedures.
The GDPR imposes requirements relating to, among other things, consent to process personal data of individuals, the information provided to individuals regarding the processing of their personal data, rights which may be exercised by individuals, the security and confidentiality of personal data, and notifications in the event of data breaches and use of third-party processors.
For example, in Europe Regulation (EU) 2016/679 (GDPR) imposes requirements relating to, among other things, consent to process personal data of individuals, the information provided to individuals regarding the processing of their personal data, rights which may be exercised by individuals, the security and confidentiality of personal data, and notifications in the event of data breaches and use of third-party processors.
Any further escalation of political tensions or economic instability in these regions could disrupt or delay our research and development operations in these regions, or adversely affect the timeliness of new product delivery or maintenance and upgrades to existing products and solutions, which could harm our operations, financial conditions, sales and growth prospects.
Political tensions or economic instability in the regions where we conduct operations could disrupt or delay our research and development operations or adversely affect the timeliness of new product delivery or maintenance and upgrades to existing products and solutions, which could harm our operations, financial conditions, sales and growth prospects.
Additionally, we are currently, and may in the future be, under audit by one or more state or local tax authorities with regard to sales tax and other indirect tax matters.
Additionally, we have been in the past and may in the future be, under audit by one or more state or local tax authorities with regard to sales tax and other indirect tax matters.
Pursuant to the Stockholders’ Agreement, so long as each of Anderson and Great Hill beneficially owns at least 10.0% of our outstanding common stock, each shall have the right to nominate one director to our board of directors.
Pursuant to the Stockholders’ Agreement, so long as Anderson beneficially owns at least 10% of our outstanding common stock, it shall have the right to nominate one director to our board of directors.
Risk Factors Summary Below is a summary of material factors that make an investment in our common stock speculative or risky: • Our rapid growth makes it difficult to evaluate our future prospects and may increase the risk that we will not continue to grow at or near historical rates. • We have a history of losses and may not achieve or maintain profitability in the future. • All of our revenues are generated by sales to clients in our targeted verticals, and factors, including the downturn in U.S. and global markets and economic conditions, that adversely affect the applicable industry could also adversely affect our business. • Russian military action against Ukraine and subsequent sanctions against Russia and Belarus has resulted in disruptions to some of our research and development resources, which could lead to interruptions in our development efforts or hamper our ability to maintain our solutions. • If our solutions or third-party cloud providers or sub-processors experience data security breaches and there is loss, theft, misuse, unauthorized disclosure or unauthorized access to our clients’ data, we may lose current or future clients, our reputation and business may be harmed, and we may be subject to governmental inquiries or investigations and a risk of loss or liability. • Our business depends on clients renewing and expanding their subscriptions for our solutions.
Risk Factors Summary Below is a summary of material factors that make an investment in our common stock speculative or risky: • Our rapid growth makes it difficult to evaluate our future prospects and may increase the risk that we will not continue to grow at or near historical rates. • We have a history of losses and may not achieve or maintain profitability in the future. • All of our revenues are generated by sales to clients in our targeted verticals, and factors, including the downturns in U.S. and global markets and economic conditions, that adversely affect the applicable industry could also adversely affect our business. • If our solutions or third-party cloud providers or sub-processors experience data security breaches and there is loss, theft, misuse, unauthorized disclosure or unauthorized access to our clients’ data, we may lose current or future clients, our reputation and business may be harmed, and we may be subject to governmental inquiries or investigations and a risk of loss or liability. • Our business depends on clients renewing and expanding their subscriptions for our solutions.
Such changes could hamper our ability to use data to train our artificial intelligence algorithms. Further, any inability to adequately address privacy concerns in connection with our solutions, or comply with applicable privacy or data protection laws, regulations and policies, could result in additional cost and liability to us, and adversely affect our ability to offer our solutions.
Further, any inability to adequately address privacy concerns in connection with our solutions, or comply with applicable privacy or data protection laws, regulations and policies, could result in additional cost and liability to us, and adversely affect our ability to offer our solutions.
We expect to continue to incur losses for the foreseeable future as we intend to continue to invest in product development, sales and marketing programs and acquisitions to support further growth. These expenditures may not result in additional revenues or growth of our business. We have also experienced increased costs in being a public company.
We expect to continue to incur losses for the foreseeable future as we intend to continue to invest in product development, sales and marketing programs and acquisitions to support further growth. These expenditures may not result in additional revenues or growth of our business.
Accordingly, if we or our partners do not effectively assist our clients in implementing our solutions, train our clients in the use of our solutions, succeed in helping our clients quickly resolve post-implementation issues, our ability to sell additional solutions and implementation services to existing clients would be adversely affected and our reputation with potential clients could be damaged, which could have a material adverse effect on our business, results of operations, financial condition, and growth prospects.
Accordingly, if we or our partners do not effectively assist our clients in implementing our solutions, train our clients in the use of our solutions, succeed in helping our clients quickly resolve post-implementation issues, our ability to sell additional solutions and implementation services to existing clients would be adversely affected and our reputation with potential clients could be damaged, which could have a material adverse effect on our business, results of operations, financial condition, and growth prospects. 22 Table of Contents Real or perceived errors or failures in our solutions may affect our reputation, cause us to lose clients and reduce sales which may harm our business and results of operations.
Our current international operations and our plans to expand our international operations subject us to a variety of risks, including: • increased management, travel, infrastructure, and legal compliance costs associated with having multiple international operations; • unique terms and conditions in contract negotiations desired by clients in foreign countries; • longer payment cycles and difficulties in enforcing contracts and collecting accounts receivable; • the need to localize our solutions and store data locally for international clients; • lack of familiarity with and unexpected changes in foreign regulatory requirements; • increased exposure to fluctuations in currency exchange rates; • levels of inflation in international economies; 26 Table of Contents • the burdens and costs of complying with a wide variety of foreign laws and legal standards, including the General Data Protection Regulation in the European Union; • compliance with the U.S.
Our current international operations and our plans to expand our international operations subject us to a variety of risks, including: • increased management, travel, infrastructure, and legal compliance costs associated with having multiple international operations; • unique terms and conditions in contract negotiations desired by clients in foreign countries; • longer payment cycles and difficulties in enforcing contracts and collecting accounts receivable; • the need to localize our solutions and store data locally for international clients; • lack of familiarity with and unexpected changes in foreign regulatory requirements; • increased exposure to fluctuations in currency exchange rates; • levels of inflation in international economies; • the burdens and costs of complying with a wide variety of foreign laws and legal standards, including employment, tax, privacy, anticorruption, import/export, antitrust, data transfer, storage and protection, health and safety, and industry-specific laws and regulations; • compliance with the U.S.
If we are unable to attract, integrate and retain qualified personnel, or if there are delays in hiring required personnel, including delays due to geopolitical instability or outbreaks, epidemics, or pandemics involving public health or adjustments to U.S. immigration policy related to skilled foreign workers, our business, results of operations, and financial condition may be materially adversely affected.
If we are unable to attract, integrate and retain qualified personnel, or if there are delays in hiring required personnel, including delays due to geopolitical instability or outbreaks, epidemics, or pandemics involving public health or adjustments to U.S. immigration policy related to skilled foreign workers, our business, results of operations, and financial condition may be materially adversely affected. 29 Table of Contents Increases in labor costs, including wages, and an overall tightening of the labor market, could adversely affect our business, results of operations or financial condition.
Adverse changes in domestic and global economic and political conditions, including those associated with outbreaks, epidemics, or pandemics involving public health Russian military action against Ukraine, inflation and the adverse economic downturn, stress and volatility in the financial services industry and impacts from climate change, could result in significant decreases in demand or lengthened sales cycles for our solutions, including the delay or cancellation of current or anticipated projects, and reduction in IT spending by our clients and potential clients, or could present difficulties in collecting accounts receivables from our clients if their financial condition deteriorates.
Adverse changes in domestic and global economic and political conditions, including those associated with outbreaks, epidemics, or pandemics involving public health, uncertainty as a result of geopolitical events such as the conflicts in and around Ukraine, the Middle East and other parts of the world, inflation, elevated interest rates and the adverse economic downturn, stress and volatility in the financial services industry and impacts from climate change, could result in significant decreases in demand or lengthened sales cycles for our solutions, including the delay or cancellation of current or anticipated projects, and reduction in IT spending by our clients and potential clients, or could present difficulties in collecting accounts receivables from our clients if their financial condition deteriorates.
We may also deem it advisable in the near-term or later to downsize certain of our offices in order to reduce costs, which may cause us to incur related charges.
We continue to assess our facilities requirements and may deem it advisable in the near-term or later to add new offices or downsize certain of our offices in order to reduce costs, which may cause us to incur related charges.
Moreover, policing our intellectual property rights is difficult, costly and may not always be effective. 24 Table of Contents From time to time, legal action by us may be necessary to enforce our patents and other intellectual property rights, to protect our trade secrets, to determine the validity and scope of the intellectual property rights of others or to defend against claims of infringement or invalidity.
From time to time, legal action by us may be necessary to enforce our patents and other intellectual property rights, to protect our trade secrets, to determine the validity and scope of the intellectual property rights of others or to defend against claims of infringement or invalidity.
We rely on third-party technology and systems for a variety of services, including, without limitation, third-party cloud providers or sub-processors to host our websites and web-based services, encryption and authentication technology, employee email, content delivery to clients, back-office support and other functions, and the ability to prevent breaches of any of these systems may be beyond our control.
Additionally, if we are unable to adequately address our clients’ concerns about security, we may have difficulty selling our solutions. 14 Table of Contents We rely on third-party technology and systems for a variety of services, including, without limitation, third-party cloud providers or sub-processors to host our websites and web-based services, encryption and authentication technology, employee email, content delivery to clients, back-office support and other functions, and the ability to prevent breaches of any of these systems may be beyond our control.
This private right of action may increase the likelihood of, and risks associated with, data breach litigation. In addition, in November 2020, California voters adopted the CPRA, which became effective January 1, 2023 and under which enforcement has been delayed until March 29, 2024, and enhances and strengthens regulatory requirements and individual protections that currently exist under the CCPA.
This private right of action may increase the likelihood of, and risks associated with, data breach litigation. In addition, in November 2020, California voters adopted the CPRA, which enhances and strengthens regulatory requirements and individual protections that currently exist under the CCPA.
If we are unable to sell our solutions into new markets or to further penetrate existing markets, or to increase sales from existing clients by selling them additional software and services, our revenues will not grow as expected, which would have a material adverse effect on our business, financial condition, and results of operations.
If we are unable to sell our solutions into new markets or to further penetrate existing markets, or to increase sales from existing clients by selling them additional software and services, our revenues will not grow as expected, which would have a material adverse effect on our business, financial condition, and results of operations. 17 Table of Contents We compete in highly competitive markets, and if we do not compete effectively, our business, results of operations, and financial condition could be negatively impacted and cause our market share to decline.
Furthermore, Anderson and Great Hill control a significant portion of the voting power of the shares of our common stock eligible to vote in the election of our directors and on other matters submitted to a vote of our stockholders, and Anderson and Great Hill are able to influence outcome of matters submitted to a stockholder vote.
Furthermore, Anderson controls 23% of the voting power of the shares of our common stock eligible to vote in the election of our directors and on other matters submitted to a vote of our stockholders, and Anderson may be able to influence outcome of matters submitted to a stockholder vote.
Any further changes made to the IRC or to the regulations promulgated thereunder could impact our ability to utilize our NOLs. Accordingly, any such occurrences could adversely affect our financial condition, operating results, and cash flows. Our international sales and operations subject us to additional risks that can adversely affect our business, results of operations and financial condition.
Any further changes made to the IRC or to the regulations promulgated thereunder could impact our ability to utilize our NOLs. Accordingly, any such occurrences could adversely affect our financial condition, operating results, and cash flows.
In addition, Delaware law may impose requirements that may restrict our ability to pay dividends. Until such time that we pay a dividend, our investors must rely on sales of their common stock after price appreciation, which may never occur, as the only way to realize any future gains on their investment.
Additionally, our revolving credit facility agreements limit the ability of certain of our subsidiaries to pay dividends. Until such time that we pay a dividend, which may never occur, our investors must rely on sales of their common stock after price appreciation, which may never occur, as the only way to realize any future gains on their investment.
The GDPR imposes substantial fines for breaches of data protection requirements, which can be up to four percent of the worldwide revenues or 20 million Euros, whichever is greater.
The GDPR imposes substantial fines for breaches of data protection requirements, which can be up to four percent of the worldwide revenues or 20 million Euros, whichever is greater. Despite the UK’s exit from the EU, the UK still also has laws equivalent to the GDPR/EU data protection laws.
Despite the measures that we have or may take, our infrastructure will be potentially vulnerable to physical or electronic break-ins, computer viruses or similar problems, and in the case of third-party cloud providers, may be outside of our control. If a person circumvents our security measures, that person could misappropriate proprietary information or disrupt or damage our operations.
Despite the measures that we have or may take, our infrastructure will be potentially vulnerable to physical or electronic break-ins, ransomware attacks, computer viruses or similar problems, and in the case of third-party cloud providers, may be outside of our control.
In order to maintain and improve the effectiveness of our disclosure controls and procedures and internal control over financial reporting, we have expended, and anticipate that we will continue to expend, significant resources, including accounting-related costs and significant management oversight. 25 Table of Contents Our current controls and any new controls that we develop may become inadequate because of changes in conditions in our business.
In order to maintain and improve the effectiveness of our disclosure controls and procedures and internal control over financial reporting, we have expended, and anticipate that we will continue to expend, significant resources, including accounting-related costs and significant management oversight.
We expect to continue to grow, in part, by making targeted acquisitions. Our business strategy includes the potential acquisition of shares or assets of, or alliances with companies with software, technologies or businesses complementary to ours, both domestically and globally.
Our business strategy includes the potential acquisition of shares or assets of, or alliances with companies with software, technologies or businesses complementary to ours, both domestically and globally.
As of August 25, 2023, there were 69,240,659 shares of common stock outstanding. Approximately 28% of our outstanding common stock is held by Anderson and approximately 23% of our outstanding common stock is held by Great Hill and can be resold into the public markets in the future in accordance with the requirements of Rule 144.
As of August 12, 2024, there were 74,699,528 shares of common stock outstanding. Approximately 23% of our outstanding common stock is held by Anderson and can be resold into the public markets in the future in accordance with the requirements of Rule 144.
Such reclassification could have an adverse effect on our business and results of operations, could require us to pay significant retroactive wages, taxes and penalties, and could force us to change our contractor business model in the foreign jurisdictions affected. Failure to comply with the GDPR or other data privacy regimes could subject us to liability, fines and reputational harm.
Such reclassification could have an adverse effect on our business and results of operations, could require us to pay significant retroactive wages, taxes and penalties, and could force us to change our contractor business model in the foreign jurisdictions affected.
If the market for SaaS solutions for professional and financial services develops slower than we expect or declines, it could have a material adverse effect on our business, financial condition and results of operations.
In addition, the failure to increase, or the loss of, market share, would harm our business, results of operations, financial condition, and/or future prospects. 18 Table of Contents If the market for SaaS solutions for professional and financial services develops slower than we expect or declines, it could have a material adverse effect on our business, financial condition and results of operations.
These anti-takeover provisions could substantially impede the ability of public stockholders to benefit from a change in control or change our management and board of directors and, as a result, may adversely affect the market price of our common stock and your ability to realize any potential change of control premium.
These anti-takeover provisions could substantially impede the ability of public stockholders to benefit from a change in control or change our management and board of directors and, as a result, may adversely affect the market price of our common stock and your ability to realize any potential change of control premium. 33 Table of Contents Risks Related to Ownership of Our Common Stock The market price and trading volume of our common stock has been and may continue to be volatile, which could result in rapid and substantial losses for our stockholders.
Any such disruptions may also magnify the impact of other risks described in our Annual Report this Form 10-K. 13 Table of Contents If our solutions or third-party cloud providers or sub-processors experience data security breaches, and there is loss, theft, misuse, unauthorized disclosure or unauthorized access to our clients’ data, we may lose current or future clients, our reputation and business may be harmed, and we may be subject to governmental inquiries or investigations and a risk of loss or liability.
If our solutions or third-party cloud providers or sub-processors experience data security breaches, and there is loss, theft, misuse, unauthorized disclosure or unauthorized access to our clients’ data, we may lose current or future clients, our reputation and business may be harmed, and we may be subject to governmental inquiries or investigations and a risk of loss or liability.
As we continue to expand our business globally, our success will depend, in large part, on our ability to anticipate and effectively manage these and other risks associated with our international operations. Any of these risks could harm our international operations and reduce our international sales, adversely affecting our business, results of operations, financial condition, and growth prospects.
As we continue to expand our business globally, our success will depend, in large part, on our ability to anticipate and effectively manage these and other risks associated with our international operations.
Our voluntary participation in agreements with states, countries, or other jurisdictions, or successful assertions by states, countries, or other jurisdictions that we should have been or should be collecting additional sales, use, or other taxes on our solutions could, among other things, result in substantial tax liabilities for past sales, create significant administrative burdens for us, discourage clients from purchasing our solutions, or otherwise harm our business, results of operations, and financial condition.
Our voluntary participation in agreements with states, countries, or other jurisdictions, or successful assertions by states, countries, or other jurisdictions that we should have been or should be collecting additional sales, use, or other taxes on our solutions could, among other things, result in substantial tax liabilities for past sales, create significant administrative burdens for us, discourage clients from purchasing our solutions, or otherwise harm our business, results of operations, and financial condition. 32 Table of Contents Risks Related to Our Organizational Structure If the ownership of our common stock continues to be highly concentrated, it may prevent other minority stockholders from influencing significant corporate decisions and may result in conflicts of interest.
Treasury Department, increasing the uncertainty as to the ultimate effects on us and our stockholders. In addition, we are subject to the examination of our income tax returns by the Internal Revenue Service (“IRS”) and other tax authorities. We regularly assess the likelihood of adverse outcomes resulting from such examinations to determine the adequacy of our provision for income taxes.
In addition, we are subject to the examination of our income tax returns by the Internal Revenue Service (“IRS”), foreign and other tax authorities. We regularly assess the likelihood of adverse outcomes resulting from such examinations to determine the adequacy of our provision for income taxes. Significant judgment is required in determining our worldwide provision for income taxes.
In certain sectors of the financial services industry, certain financial institutions have faced liquidity and solvency concerns, consolidation, a severe decline in market value, distress, failure and receivership.
In certain sectors of the financial services industry, certain financial institutions have faced liquidity and solvency concerns, consolidation, a severe decline in market value, distress, failure and receivership. For example, in March 2023, Silicon Valley Bank (SVB) was closed by regulators.
In addition, under GDPR, transfers of personal data to countries outside of the European Economic Area are prohibited to countries that have not been determined by the European Commission to provide adequate protections for personal data, including the United States. Switzerland has similar restrictions.
Under GDPR, transfers of personal data to countries outside of the European Economic Area that have not been determined by the European Commission to provide adequate protections for personal data, including the United States, are prohibited unless certain transfer mechanisms are used. Switzerland and the UK have similar restrictions. However, such mechanisms are subject to consistent scrutiny and challenge.
Alternatively, if a court were to find the choice of forum provision in our amended and restated certificate of incorporation to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could harm our business, results of operations and financial condition.
Alternatively, if a court were to find the choice of forum provision in our amended and restated certificate of incorporation to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could harm our business, results of operations and financial condition. 36 Table of Contents General Risk Factors We may be adversely affected by natural disasters, outbreaks, epidemics, or pandemics involving public health, other catastrophic events and terrorism that could disrupt and harm our business, results of operations, and financial condition.
We may in the future, identify deficiencies and be unable to remediate them before we must provide the required reports. Furthermore, if we have a material weakness in our internal control over financial reporting, we may not detect errors on a timely basis and our financial statements may be materially misstated.
Furthermore, if we have a material weakness in our internal control over financial reporting, we may not detect errors on a timely basis and our financial statements may be materially misstated.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changeIn addition to our head office, we also maintain eight offices in multiple locations in the United States and internationally in the United Kingdom, Singapore and Ukraine. We are evaluating our real estate strategy as it relates to the impact of post-pandemic and changing needs of a hybrid workforce.
Biggest changeIn addition to our head office, we also maintain ten offices in multiple locations in the U.S. and internationally in the U.K., Netherlands, Ukraine, Germany and Singapore.
Item 2. Pro perties. We have nine offices globally, all in leased or managed premises. Our corporate headquarters is located in Palo Alto, California, and consists of approximately 13,000 square feet of space pursuant to an agreement that expires in August 2024.
Item 2. Pro perties. We have eleven offices globally, all in leased or managed premises. Our corporate headquarters is located in Palo Alto, California, and consists of approximately 13,000 square feet of space pursuant to an agreement that expires in August 2025.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeSecurities Authorized for Issuance Under Equity Compensation Plans The information required by this Item regarding equity compensation plans is incorporated by reference to the information set forth in Part III, Item 12 of this Annual Report on Form 10-K. 41 Table of Contents Performance Graph The following graph shows a comparison of the cumulative total return for our common stock to the Nasdaq Composite - Total Return Index and S&P Software & Services Select Industry Index for the fiscal year ended June 30, 2023, assuming an initial investment of $100.
Biggest changeSecurities Authorized for Issuance Under Equity Compensation Plans The information required by this Item regarding equity compensation plans is incorporated by reference to the information set forth in Part III, Item 12 of this Annual Report on Form 10-K. 41 Table of Contents Performance Graph The following graph shows a comparison of the cumulative total stockholder return for our common stock to the Nasdaq Composite — Total Return Index and S&P Software & Services Select Industry Index, assuming an initial investment of $100 at the market close on June 30, 2021, the date our stock commenced trading on the Nasdaq Global Select Market through June 30, 2024.
Comparison of Cumulative Total Return The performance graph above shall not be deemed “soliciting material” or to be “filed” with the SEC for purposes of Section 18 of the Exchange Act or incorporated by reference into any of our filings under the Exchange Act or the Securities Act.
The performance graph above shall not be deemed “soliciting material” or to be “filed” with the SEC for purposes of Section 18 of the Exchange Act or incorporated by reference into any of our filings under the Exchange Act or the Securities Act.
Item 4. Mine Saf ety Disclosures. Not applicable. 40 Table of Contents PART II Item 5 . Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market Information Our common stock is listed on the Nasdaq Global Select Market under the symbol “INTA” and began trading on June 30, 2021.
Item 4. Mine Saf ety Disclosures. Not applicable. 40 Table of Contents PART II Item 5 . Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.
Removed
Prior to that date, there was no public trading market for our common stock. Holders of Common Stock As of August 25, 2023, there were 30 holders of record of our common stock.
Added
Market Information Our common stock is listed on the Nasdaq Global Select Market under the symbol “INTA.” Holders of Common Stock As of August 12, 2024, there were 31 holders of record of our common stock.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeItem 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 41 Item 6. [Reserved] 42 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 43 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 64 Item 8. Financial Statements and Supplementary Data 65
Biggest changeItem 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 41 Item 6. [Reserved] 42 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 43 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 58 Item 8. Financial Statements and Supplementary Data 59

Item 7. Management's Discussion & Analysis

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

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Biggest changeWe maintain a full valuation allowance on our federal and state deferred tax assets as we have concluded that it is more likely than not that the deferred tax assets will not be realized. 47 Table of Contents Results of Operations The following tables set forth our results of operations for the periods presented, expressed in total dollar terms and as a percentage of total revenues (percentages may not add up due to rounding): Year Ended June 30, 2023 2022 2021 (in thousands, except for percentages) Revenues: SaaS and support $ 252,310 72 % $ 192,980 71 % $ 144,075 67 % Subscription license 48,970 14 44,202 16 45,963 21 Total recurring revenues 301,280 86 237,182 87 190,038 89 Professional services 49,593 14 34,889 13 24,595 11 Total revenues 350,873 100 272,071 100 214,633 100 Cost of revenues (1) : SaaS and support 53,022 15 51,177 19 40,644 19 Total cost of recurring revenues 53,022 15 51,177 19 40,644 19 Professional services 58,440 17 47,906 18 33,730 16 Total cost of revenues 111,462 32 99,083 36 74,374 35 Gross profit 239,411 68 172,988 64 140,259 65 Operating expenses (1) : Research and development 93,851 27 74,412 27 50,853 24 Sales and marketing 132,189 38 111,905 41 69,948 33 General and administrative (2) 81,031 23 86,127 32 42,418 20 Lease modification and impairment 1,601 — — — — — Total operating expenses 308,672 88 272,444 100 163,219 76 Operating loss (69,261 ) (20 ) (99,456 ) (37 ) (22,960 ) (11 ) Loss on debt extinguishment — — (2,407 ) (1 ) — — Interest expense (156 ) — (274 ) — (24,608 ) (11 ) Other income (expense), net (503 ) — (976 ) — 1,276 1 Net loss before income taxes (69,920 ) (20 ) (103,113 ) (38 ) (46,292 ) (22 ) Income tax benefit (expense) 495 — 3,435 1 (472 ) — Net loss $ (69,425 ) (20 ) % $ (99,678 ) (37 ) % $ (46,764 ) (22 ) % ___________________ (1) Amounts include stock-based compensation expense as follows: Year Ended June 30, 2023 2022 2021 Cost of SaaS and support $ 1,705 — % $ 1,258 1 % $ 250 — % Cost of professional services 3,916 1 3,029 1 878 1 Research and development 15,186 4 17,166 6 4,054 2 Sales and marketing 20,426 6 25,428 9 6,791 3 General and administrative 26,536 8 30,633 11 6,593 3 Total stock-based compensation expense $ 67,769 19 % $ 77,514 28 % $ 18,566 9 % (2) Includes acquisition-related transaction costs of $1.4 million, $1.9 million and $1.6 million for fiscal years 2023, 2022 and 2021, respectively. 48 Table of Contents Comparison of the Fiscal Years Ended June 30, 2023 and 2022 Revenues Year Ended June 30, Change 2023 2022 Amount % (in thousands, except for percentages) Revenues: SaaS and support $ 252,310 $ 192,980 $ 59,330 31 % Subscription license 48,970 44,202 4,768 11 % Total recurring revenues 301,280 237,182 64,098 27 % Professional services 49,593 34,889 14,704 42 % Total revenues $ 350,873 $ 272,071 $ 78,802 29 % Recurring Revenues Recurring revenues from the sale of our SaaS solutions, from subscriptions to our term software solutions, and from providing support for these solutions increased by $64.1 million, or 27%, compared to the prior year.
Biggest changeWe maintain a full valuation allowance on our federal and state deferred tax assets as we have concluded that it is more likely than not that the deferred tax assets will not be realized. 47 Table of Contents Results of Operations The following tables set forth our results of operations for the periods presented, expressed in total U.S. dollar terms and as a percentage of our total revenues: Year Ended June 30, 2024 2023 2022 (in thousands, except for percentages) Revenues: SaaS and support $ 315,960 73 % $ 252,310 72 % $ 192,980 71 % Subscription license 60,682 14 48,970 14 44,202 16 Professional services 53,881 13 49,593 14 34,889 13 Total revenues 430,523 100 350,873 100 272,071 100 Cost of revenues (1) : SaaS and support 59,831 14 53,022 15 51,177 18 Professional services 63,830 15 58,440 17 47,906 18 Total cost of revenues 123,661 29 111,462 32 99,083 36 Gross profit 306,862 71 239,411 68 172,988 64 Operating expenses (1) : Research and development 113,634 27 93,851 27 74,412 27 Sales and marketing 138,176 32 132,189 38 111,905 41 General and administrative (2) 87,243 20 81,031 23 86,127 32 Lease modification and impairment — — 1,601 — — — Total operating expenses 339,053 79 308,672 88 272,444 100 Operating loss (32,191 ) (8 ) (69,261 ) (20 ) (99,456 ) (37 ) Loss on debt extinguishment — — — — (2,407 ) (1 ) Interest and other income (expense), net 2,285 1 (659 ) — (1,250 ) — Net loss before income taxes (29,906 ) (7 ) (69,920 ) (20 ) (103,113 ) (38 ) Income tax (expense) benefit (2,115 ) — 495 — 3,435 1 Net loss $ (32,021 ) (7 ) % $ (69,425 ) (20 ) % $ (99,678 ) (37 ) % ___________________ (1) Amounts include stock-based compensation expense as follows: Year Ended June 30, 2024 2023 2022 Cost of SaaS and support $ 2,292 1 % $ 1,705 — % $ 1,258 1 % Cost of professional services 5,030 1 3,916 1 3,029 1 Research and development 14,854 3 15,186 4 17,166 6 Sales and marketing 17,312 4 20,426 6 25,428 9 General and administrative 20,407 5 26,536 8 30,633 11 Total stock-based compensation expense $ 59,895 14 % $ 67,769 19 % $ 77,514 28 % (2) Includes transaction costs related to acquisitions and certain non-capitalized offering-related expenses of $2.7 million, $1.4 million and $1.9 million for fiscal years 2024, 2023 and 2022, respectively. 48 Table of Contents Comparison of the Fiscal Years Ended June 30, 2024 and 2023 Revenues Year Ended June 30, Change 2024 2023 Amount % (in thousands, except for percentages) Revenues: SaaS and support $ 315,960 $ 252,310 $ 63,650 25 % Subscription license 60,682 48,970 11,712 24 % Total recurring revenues 376,642 301,280 75,362 25 % Professional services 53,881 49,593 4,288 9 % Total revenues $ 430,523 $ 350,873 $ 79,650 23 % Recurring Revenues Recurring revenues from the sale of our SaaS solutions, from subscriptions to our term software solutions, and from providing support for these solutions increased by $75.4 million, or 25%, compared to the prior year.
Income Tax Benefit (Expense) Our income tax benefit (expense) consists of an estimate of federal, state and foreign income taxes based on enacted federal, state and foreign tax rates, as adjusted for allowable credits, deductions, uncertain tax positions, changes in the valuation of our deferred tax assets and liabilities and changes in tax laws.
Income Tax (Expense) Benefit Our income tax (expense) benefit consists of an estimate of federal, state and foreign income taxes based on enacted federal, state and foreign tax rates, as adjusted for allowable credits, deductions, uncertain tax positions, changes in the valuation of our deferred tax assets and liabilities and changes in tax laws.
We finance our liquidity needs primarily through collections from clients and the issuance of equity securities. We generally bill and collect from our clients annually in advance. Our billings are subject to seasonality with billings in the fourth quarter higher than the other quarters.
We finance our liquidity needs primarily through collections from clients and the issuance of equity securities. We generally bill and collect from our clients annually in advance. Our billings are subject to seasonality with billings in the fourth quarter higher than in the other quarters.
Specifically, management reviews non-GAAP gross profit, non-GAAP recurring gross profit, and non-GAAP operating profit (loss), each of which is a non-GAAP financial measure, to manage our business, make planning decisions, evaluate our performance and allocate resources and, for the reasons described below, considers them to be useful indicators, for both management and investors, of our financial performance over time.
Specifically, management reviews non-GAAP gross profit, non-GAAP recurring gross profit, and non-GAAP operating income (loss), each of which is a non-GAAP financial measure, to manage our business, make planning decisions, evaluate our performance and allocate resources and, for the reasons described below, considers them to be useful indicators, for both management and investors, of our financial performance over time.
However, if our clients do not continue to see the ability of our platform to generate return on investment relative to other software alternatives, net revenue retention could suffer and our operating results may be adversely affected. Continued Investment in Innovation and Growth.
If our clients do not continue to see the ability of our platform to generate return on investment relative to other software alternatives, net revenue retention could suffer and our operating results may be adversely affected. Continued Investment in Innovation and Growth.
The income tax benefit for fiscal year 2023 is primarily attributable to a partial release of the valuation allowance against our deferred tax assets in the U.S. due to an acquisition that was completed during the year.
The income tax benefit for fiscal year 2023 was primarily attributable to a partial release of the valuation allowance against our deferred tax assets in the U.S. due to an acquisition that was completed during the year.
These adjustments consisted of $87.7 million of non-cash charges (principally comprising stock-based compensation expense, depreciation and amortization and amortization of operating lease right-of-use assets) and net cash inflow of $9.2 million from net changes in operating assets and liabilities.
These adjustments consisted of $87.7 million of non-cash charges (principally comprising of stock-based compensation, depreciation and amortization and amortization of operating lease right-of-use assets) and net cash inflow of $9.2 million from net changes in operating assets and liabilities.
See Note 8 to our consolidated financial statements for additional information. Purchase obligations primarily consist of non-cancelable obligations under third-party cloud hosting and support service agreements and software subscriptions. See Note 9 to our consolidated financial statements for additional information.
See Note 8 to our consolidated financial statements for additional information. Purchase obligations primarily consist of non-cancelable obligations under third-party cloud hosting and support service agreements and software subscriptions.
Lease modification and impairment Lease modification and impairment net charge of $1.6 million during fiscal year 2023 related to accelerated amortization expense associated with a right-of-use asset on the early exit of a leased office space, offset by a benefit arising from the amendment to the underlying lease agreement which resulted in a reduction in the related lease payment obligation.
Lease modification and impairment Lease modification and impairment net charge of $1.6 million during fiscal year 2023 was related to accelerated amortization expense associated with a right-of-use leased asset on the early exit of a leased office space, offset by a benefit arising from an amendment to an underlying lease agreement which resulted in a reduction in the related lease payment obligation.
From a sales perspective, our ability to add new clients and expand within existing accounts depends upon a number of factors, including the quality and effectiveness of our sales personnel and marketing efforts, and our ability to convince key decision makers within professional and financial services firms to embrace the Intapp platform over point solutions, internally developed solutions, and horizontal solutions.
From a sales perspective, our ability to add new clients and expand within existing accounts depends upon a number of factors, including the quality and effectiveness of our sales personnel and marketing efforts, and our ability to convince key decision makers within professional and financial services firms to embrace the Intapp Intelligent Cloud platform over point solutions, internally developed solutions, and horizontal solutions.
The Credit Agreement provides for a five-year, senior secured revolving credit facility of $100.0 million with a sub-facility for letters of credit in the aggregate amount of up to $10.0 million. As of June 30, 2023, no amounts have been borrowed under the JPMorgan Credit Facility. See Note 10 to our consolidated financial statements for additional information.
The Credit Agreement provides for a five-year, senior secured revolving credit facility of $100.0 million with a sub-facility for letters of credit in the aggregate amount of up to $10.0 million. As of June 30, 2024, no amounts have been borrowed under the JPMorgan Credit Facility. See Note 10 to our consolidated financial statements for additional information.
This demand will be affected by the mix of professional services that are provided by us versus provided by our third-party implementation partners. Our professional services are currently loss making (after allocated overhead costs for facilities and IT) and accounted for 14%, 13% and 11% of our total revenues during fiscal years 2023, 2022 and 2021, respectively.
This demand will be affected by the mix of professional services that are provided by us versus provided by our third-party implementation partners. Our professional services are currently loss making (after allocated overhead costs for facilities and IT) and accounted for 13%, 14% and 13% of our total revenues during fiscal years 2024, 2023 and 2022, respectively.
We have determined that we have one reporting unit for purposes of our annual impairment evaluation. As part of the annual goodwill impairment test, the Company first assesses the qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount.
We have determined that we have one reporting unit for purposes of our annual impairment evaluation. As part of the annual goodwill impairment test, we first assess the qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount.
Our recurring revenues accounted for 86%, 87% and 89% of our total revenues during fiscal years 2023, 2022 and 2021, respectively. SaaS and Support We recognize revenues from our SaaS solutions ratably over the term of the contract beginning once the SaaS environment is provisioned and made available to clients.
Our recurring revenues accounted for 87%, 86% and 87% of our total revenues during fiscal years 2024, 2023 and 2022, respectively. SaaS and Support We recognize revenues from our SaaS solutions ratably over the term of the contract beginning once the SaaS environment is provisioned and made available to clients.
We believe non-GAAP operating profit (loss) provides investors and other users of our financial information consistency and comparability with our past financial performance and facilitates period-to-period comparisons of GAAP operating loss.
We believe non-GAAP operating income (loss) provides investors and other users of our financial information consistency and comparability with our past financial performance and facilitates period-to-period comparisons of GAAP operating loss.
Subscription license fees are generally payable in advance on an annual basis over the term of the license arrangement, which is typically noncancelable. Professional Services Our professional services primarily consist of implementation, configuration and upgrade services provided to clients.
Subscription license fees are generally payable in advance on an annual basis over the term of the license arrangement, which is typically non-cancelable. Professional Services Our professional services primarily consist of implementation, configuration and upgrade services provided to clients.
Investing Activities Net cash used in investing activities consists of business acquisitions, purchases of property and equipment, leasehold improvements, and capitalization of internal-use software costs.
Investing Activities Net cash used in investing activities consists of business acquisitions, purchases of property and equipment, leasehold improvements, and capitalized internal-use software costs.
We generally price our subscriptions based on the modules deployed as well as the number of users adopting our solution. We expect the vast majority of our new ARR growth in the future to be from the sale of SaaS subscriptions. We generate a majority of our non-recurring revenues from professional services.
We generally price our subscriptions based on the number of users adopting our solution and the modules deployed. We expect the vast majority of our new ARR (as defined below) growth in the future to be from the sale of SaaS subscriptions. We generate a majority of our non-recurring revenues from professional services.
In addition, we expect to invest in sales and marketing to broaden our reach with new clients in the United States and abroad and deepen our penetration with existing clients. With our revenue growth objectives, we expect to continue to make such investments for the foreseeable future.
In addition, we expect to invest in sales and marketing to broaden our reach with new clients in the U.S. and abroad and deepen our penetration with existing clients. With our revenue growth objectives, we expect to continue to make such investments for the foreseeable future.
Factors that could cause or contribute to these differences include those discussed below and elsewhere in this Annual Report on Form 10-K, particularly in the section titled “Risk Factors.” Our historical results are not necessarily indicative of the results that may be expected for any period in the future.
Factors that could cause or contribute to these differences include those discussed below and elsewhere in this Annual Report on Form 10-K, particularly in the section titled “Cautionary Note regarding Forward-Looking Statements” and “Risk Factors.” Our historical results are not necessarily indicative of the results that may be expected for any period in the future.
We are continuing to gradually increase our general and administrative spending to support our growing operational needs. We have a track record of successfully identifying and integrating complementary businesses within the professional and financial services industry.
We intend to continue to gradually increase our general and administrative spending to support our growing operational needs. We have a track record of successfully identifying and integrating complementary businesses within the professional and financial services industry.
In the medium-term, we expect to see an increase in sales and marketing expense as we continue to expand our direct sales force to take advantage of opportunities for growth and resume more normal post-COVID-19 levels of in-person meetings, conferences, and attendance at trade shows.
In the medium-term, we expect to see an increase in sales and marketing expense as we continue to expand our direct sales force to take advantage of opportunities for growth and increase in in-person meetings, conferences, and attendance at trade shows.
To complement our organic investment in innovation and accelerate our growth, we will continue to evaluate acquisition opportunities that help us extend our platform, broaden and deepen our market leadership, and add new clients. Business Impact of Russia’s Invasion of Ukraine.
To complement our organic investment in innovation and accelerate our growth, we will continue to evaluate acquisition opportunities that help us extend our platform, broaden and deepen our market leadership, and add new clients.
Cost of Professional Services Our cost of professional services revenues comprises the personnel-related costs for our professional services employees and contractors responsible for delivering implementation, upgrade and migration services to our clients. This includes salaries, bonuses, benefits, stock-based compensation, and allocated overhead costs for facilities and IT.
Cost of Professional Services Our cost of professional services revenues comprises the personnel-related costs for our professional services employees and contractors responsible for delivering implementation, upgrade and migration services to our clients. This includes personnel costs and allocated overhead costs for facilities and IT.
As of June 30, 2023 and 2022, we had 603 and 506 clients, respectively, with contracts greater than $100,000 of ARR, of which 53 and 41 clients, respectively, had contracts greater than $1.0 million of ARR.
As of June 30, 2024 and 2023, we had 698 and 603 clients, respectively, with contracts greater than $100,000 of ARR, of which 73 and 53 clients, respectively, had contracts greater than $1.0 million of ARR.
Cost of SaaS and Support Our cost of SaaS and support revenues comprises the direct costs to deliver and support our products, including salaries, bonuses, benefits, stock-based compensation, as well as allocated overhead costs for facilities and IT, third-party hosting fees related to cloud services, amortization of capitalized internal-use software development costs and amortization of acquired intangible assets.
Cost of SaaS and Support Our cost of SaaS and support revenues comprises the direct costs to deliver and support our products, including personnel costs, allocated overhead costs for facilities and IT, third-party hosting fees related to cloud services, amortization of capitalized internal-use software costs and amortization of acquired intangible assets.
Professional Services Professional services revenues increased by $14.7 million, or 42%, for fiscal year 2023 compared to fiscal year 2022. This reflects a continuation in demand for implementation, upgrade and migration services consistent with our revenue growth.
Professional Services Professional services revenues increased by $4.3 million, or 9%, for fiscal year 2024 compared to fiscal year 2023. This reflects a continuation in demand for implementation, upgrade and migration services consistent with our revenue growth.
Our SaaS and support revenues grew $59.3 million, or 31%, in fiscal year 2023 compared to fiscal year 2022, due to sales to new clients and expansion of existing clients from both cross-selling and upselling sales motions. The continuation of clients migrating from using our on-premise solutions to our cloud solutions also contributed to the growth.
Our SaaS and support revenues increased by $63.7 million, or 25%, in fiscal year 2024 compared to fiscal year 2023, due to sales to new clients and expansion of existing clients from both cross-selling and upselling sales motions. The continuation of clients migrating from using our on-premise solutions to our cloud solutions also contributed to the growth.
Other Income (Expense), Net Other income (expense), net consists primarily of realized and unrealized foreign exchange gains and losses resulting from fluctuations in foreign currency exchange rates on monetary assets and liabilities denominated in currencies other than the U.S. dollar and interest income.
Interest and Other Income (Expense), net Interest and other income (expense), net consists primarily of interest income from our cash and cash equivalents, non-cash interest expense related to the amortization of deferred financing costs, realized and unrealized foreign exchange gains and losses resulting from fluctuations in foreign currency exchange rates on monetary assets and liabilities denominated in currencies other than the U.S. dollar.
The increase can be attributed primarily to increases in cloud hosting costs of $2.5 million, royalty expense of $1.5 million relating to third-party products, amortization expense of $1.0 million relating to capitalized software development costs and personnel-related costs of $0.7 million (which reflects a benefit of $8.4 million in fiscal year 2023 resulting from an operational and organizational realignment which reclassified expenses from cost of SaaS and support to sales and marketing), partially offset by a decrease in amortization expense of $3.5 million relating to acquired intangible assets.
The increase can be attributed primarily to increases in cloud hosting costs of $4.2 million, royalty expense of $1.4 million relating to third-party products, amortization expense of $1.1 million relating to internal-use software costs and amortization of acquired intangible assets and personnel related costs of $0.8 million which reflect a benefit of $5.5 million in fiscal year 2024 resulting from an operational and organizational realignment that reclassified expenses from cost of SaaS and support to research and development.
The net cash inflow from changes in operating assets and liabilities was primarily driven by an increase in accounts payable and accrued liabilities of $10.7 million due to an increase in accrued bonuses and timing of payments, and an increase in deferred revenues of $28.8 million consistent with our revenue growth.
The net cash inflow from changes in operating assets and liabilities was primarily driven by an increase in deferred revenues of $28.3 million due to our revenue growth, an increase in accounts payable and accrued liabilities of $9.4 million due to timing of payments, and an increase in other liabilities of $1.4 million due to the timing of payments.
We determine the grant date fair value of our stock option awards using the Black-Scholes option pricing model and for awards without performance conditions the related stock-based compensation is recognized in the consolidated statements of operations on a straight-line basis, over the period in which a participant is required to provide service in exchange for the stock-based award, which is generally four years.
We determine the grant date fair value of our stock option awards and stock purchase rights under the 2021 Employee Stock Purchase Plan (“ESPP”) using the Black-Scholes option pricing model, and recognize the related stock-based compensation in the consolidated statements of operations on a straight-line basis, over the period in which a participant is required to provide service in exchange for the stock-based award.
As a public company, we expect to continue to incur significant accounting and legal costs related to compliance with rules and regulations enacted by the SEC, including the costs of maintaining compliance with the Sarbanes-Oxley Act, as well as insurance, investor relations and other costs associated with being a public company.
As a public company, we expect to continue to incur significant accounting and legal costs related to compliance with rules and regulations enacted by the SEC, including increase in compliance costs with the Sarbanes-Oxley Act as a result of our transition from emerging growth company to large accelerated filer status, as well as insurance, investor relations and other costs associated with being a public company.
We upsold additional seats and cross-sold new solutions to our existing clients such that our trailing twelve months’ net revenue retention rate as of June 30, 2023 was within our expected range of 113% to 117%.
We upsold additional seats and cross-sold new solutions to our existing clients such that our trailing twelve months’ NRR rate as of June 30, 2024 was 116%, which is within our expected range of 113% to 117%. Cloud NRR Cloud NRR is the portion of our NRR which represents the net revenue retention of our SaaS contracts.
During fiscal year 2021, net cash used in investing activities was $25.6 million, consisting of $20.6 million of cash consideration (net of cash acquired) paid for our acquisition of Repstor, capitalized internal-use software costs of $2.5 million and capital expenditures of $2.5 million on property and equipment consisting largely of leasehold improvements to our facilities in Charlotte, North Carolina. 57 Table of Contents Financing Activities During fiscal year 2023, net cash provided by financing activities was $64.1 million, primarily comprised of $70.1 million in net proceeds from our public offering completed in May 2023, $23.5 million of proceeds from stock option exercises and $2.7 million of proceeds from employee stock purchase plan, partially offset by $22.3 million of payments for the final contingent consideration and cash holdback related to the acquisition of Repstor and deferred purchase consideration related to the acquisition of Billstream, $9.1 million of payments related to employee payroll tax withholding on vested equity awards and $0.8 million of payments related to offering costs in connection with our follow-on public offering.
During fiscal year 2023, net cash provided by financing activities was $64.1 million, primarily comprised of $70.1 million in net proceeds from our public offering completed in May 2023, $23.5 million of proceeds from stock option exercises and $2.7 million of proceeds from employee stock purchase plan, partially offset by $22.3 million of payments for the final contingent consideration and cash holdback related to the acquisition of Repstor and deferred purchase consideration related to the acquisition of Billstream, $9.1 million of payments related to employee payroll tax withholding on vested equity awards and $0.8 million of payments related to offering costs in connection with our follow-on public offering.
This metric accounts for changes in our recurring revenue base from cross-sell (additional solution capabilities sold), upsell (additional seats sold), price changes, and client attrition (including contraction of solution capabilities, contraction of seats and client churn).
We then divide the current period ARR by the prior period ARR to calculate the NRR. This metric accounts for changes in our recurring revenue base from cross-sell (additional solution capabilities sold), upsell (additional seats sold), price changes, and client attrition (including contraction of solution capabilities, contraction of seats and client churn).
We believe non-GAAP recurring gross profit provides investors and other users of our financial information consistency and comparability with our past financial performance and facilitates period-to-period comparisons of recurring gross profit as management is focused on increasing sales associated with our recurring revenue stream.
We believe non-GAAP gross profit provides investors and other users of our financial information consistency and comparability with our past financial performance and facilitates period-to-period comparisons of gross profit.
We believe our existing cash, cash equivalents and restricted cash as of June 30, 2023, along with our JPMorgan Credit Facility described below, will be sufficient to meet our working capital and capital expenditure needs for at least the next twelve months.
Operating losses could continue in the future as we continue to invest in the growth of our business. We believe our existing cash and cash equivalents as of June 30, 2024, along with our JPMorgan Credit Facility described below, will be sufficient to meet our working capital and capital expenditure needs for the next twelve months and beyond.
GAAP requires the use of estimates and judgments that affect the reported amounts of assets, liabilities, revenues, and expenses. These estimates and judgments are based on historical experience, future expectations and other factors and assumptions we believe to be reasonable under the circumstances. The most significant estimates and judgments are reviewed on an ongoing basis and are revised when necessary.
These estimates and judgments are based on historical experience, future expectations and other factors and assumptions we believe to be reasonable under the circumstances. The most significant estimates and judgments are reviewed on an ongoing basis and are revised when necessary. Actual amounts may differ from these estimates and judgments.
Our clients utilize these services to configure and implement one or more modules of the Intapp platform, integrate those modules with the existing platform and with other core systems in their IT environment, upgrade their existing deployment, and provide training for their employees. Other professional services include strategic consulting and advisory work, which are generally provided on a standalone basis.
Our clients utilize these services to configure and implement one or more modules of the Intapp Intelligent Cloud platform, integrate those modules with the existing platform and with other core systems in their IT environment, upgrade their existing deployment, and provide training for their employees.
The following table provides a reconciliation of gross profit to non-GAAP gross profit (in thousands): Year Ended June 30, 2023 2022 2021 GAAP gross profit $ 239,411 $ 172,988 $ 140,259 Adjusted to exclude the following: Stock-based compensation 5,621 4,287 1,128 Amortization of intangible assets 4,340 7,877 6,783 Non-GAAP gross profit $ 249,372 $ 185,152 $ 148,170 Non-GAAP Recurring Gross Profit We define non-GAAP recurring gross profit as GAAP total recurring revenues less GAAP total cost of recurring revenues adjusted for the portion of cost related to stock-based compensation expense and amortization of intangible assets.
The following table provides a reconciliation of gross profit to non-GAAP gross profit (in thousands): Year Ended June 30, 2024 2023 2022 GAAP gross profit $ 306,862 $ 239,411 $ 172,988 Adjusted to exclude the following: Stock-based compensation 7,322 5,621 4,287 Amortization of intangible assets 4,778 4,340 7,877 Restructuring and other costs 342 — — Non-GAAP gross profit $ 319,304 $ 249,372 $ 185,152 Non-GAAP Recurring Gross Profit We define non-GAAP recurring gross profit as revenues from our GAAP SaaS and support and subscription license less GAAP SaaS and support cost of revenues adjusted for the portion of cost related to stock-based compensation expense and amortization of intangible assets.
These adjustments consisted of $32.6 million of non-cash charges (principally comprising stock-based compensation expense and depreciation and amortization), and net cash inflow of $4.5 million from net changes in operating assets and liabilities.
These adjustments consisted of $82.0 million of non-cash charges (principally comprising of stock-based compensation, depreciation and amortization and amortization of operating lease right-of-use assets) and net cash inflow of $17.3 million from net changes in operating assets and liabilities.
The improvement in gross profit was also attributable to the increase in subscription license revenue which contributed $4.7 million and the decrease in losses on professional services which contributed $4.2 million.
The improvement in gross profit was also attributable to the increase in subscription license revenue which contributed $11.7 million.
Cash Flows The following table summarizes our cash flows from operating, investing, and financing activities for the periods indicated (in thousands): Year Ended June 30, 2023 2022 2021 Net cash provided by (used in) operating activities (1) $ 27,487 $ 14,236 $ (9,749 ) Net cash used in investing activities (14,340 ) (7,287 ) (25,604 ) Net cash provided by financing activities 64,100 6,647 32,404 Effect of foreign currency exchange rate changes on cash and cash equivalents (373 ) (748 ) 1,253 Net increase (decrease) in cash, cash equivalents and restricted cash $ 76,874 $ 12,848 $ (1,696 ) (1) Includes debt-related cash interest payments of $6.0 million and $24.1 million during fiscal years 2022 and 2021, respectively. 56 Table of Contents Operating Activities During fiscal year 2023, net cash provided by operating activities was $27.5 million, as our operating loss of $69.4 million was reduced by $96.9 million of adjustments.
Cash Flows The following table summarizes our cash flows from operating, investing, and financing activities for the periods presented (in thousands): Year Ended June 30, 2024 2023 2022 Net cash provided by operating activities (1) $ 67,231 $ 27,487 $ 14,236 Net cash used in investing activities (19,828 ) (14,340 ) (7,287 ) Net cash provided by financing activities 30,325 64,100 6,647 Effect of foreign currency exchange rate changes on cash and cash equivalents (343 ) (373 ) (748 ) Net increase in cash, cash equivalents and restricted cash $ 77,385 $ 76,874 $ 12,848 (1) Includes debt-related cash interest payments of $6.0 million during fiscal year 2022.
Subscription license revenues increased $4.8 million, or 11%, in fiscal year 2023 compared to fiscal year 2022, reflecting larger CPI-based price increases on annual renewals, some multi-year renewals, as well as annual renewals on multi-year contracts upon expiration of their initial term.
Subscription license revenues increased by $11.7 million, or 24%, in fiscal year 2024 compared to fiscal year 2023, due to sustained annual renewals on multi-year contracts upon expiration of their initial term, CPI-based price increases on annual renewals and new multi-year contracts.
Cloud ARR Cloud ARR is the portion of our ARR which represents the annualized recurring value of our active SaaS contracts. We believe Cloud ARR provides important information about our ability to sell new SaaS subscriptions to existing clients and to acquire new SaaS clients.
We believe Cloud ARR provides important information about our ability to sell new SaaS subscriptions to existing clients and to acquire new SaaS clients.
The determination of SSP involves judgment and is generally based on the contractually stated, observable prices of the promised goods and services charged when sold separately to client.
The determination of SSP involves judgment and is generally based on the contractually stated, observable prices of the promised goods and services charged when sold separately to client. In a contract with multiple performance obligations, we allocate revenues to each performance obligation at the inception of the contract.
Income Tax Benefit (Expense) Year ended June 30, Change 2022 2021 Amount % (in thousands, except for percentages) Income tax benefit (expense) $ 3,435 $ (472 ) $ 3,907 (828 )% Income tax benefit was $3.4 million for fiscal year 2022 compared to an income tax expense of $0.5 million recorded during fiscal year 2021.
Income Tax (Expense) Benefit Year Ended June 30, Change 2024 2023 Amount % (in thousands, except for percentages) Income tax (expense) benefit $ (2,115 ) $ 495 $ (2,610 ) (527 )% Income tax expense was $2.1 million for fiscal year 2024 compared to an income tax benefit of $0.5 million recorded during fiscal year 2023.
As of June 30, 2023, we had over 2,300 clients. Our client base includes some of the largest and most reputable professional and financial services firms globally.
As of June 30, 2024, we had over 2,550 clients. No single client represented more than 10% of total revenues for fiscal years 2024, 2023 and 2022, respectively. Our client base includes some of the largest and most reputable professional and financial services firms globally.
We then calculate the ARR from these same clients as of the current fiscal period, or current period ARR. We then divide the current period ARR by the prior period ARR to calculate the net revenue retention.
We calculate this by starting with the ARR from the cohort of all clients as of the twelve months prior to the applicable fiscal period, or prior period ARR. We then calculate the ARR from these same clients as of the current fiscal period, or current period ARR.
Sales of subscriptions to license our on-premises software ; iii. Provision of support activities ; and iv. Provision of professional services .
We derive our revenues primarily from the Sales of our SaaS solutions, subscriptions to license our on-premises software, provision of support activities and professional services.
If, as a result of its qualitative assessment, the carrying amount of the reporting unit is more than its fair value, an impairment charge in the amount of such excess is recorded to goodwill. 62 Table of Contents Recent Accounting Pronouncements See Note 2 to our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K for more information regarding recent accounting pronouncements and our assessment of their impact.
Recent Accounting Pronouncements See Note 2 to our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K for more information regarding recent accounting pronouncements and our assessment of their impact. 57 Table of Contents
We were in compliance with all of the covenants as of June 30, 2023. As of June 30, 2023, no amounts have been borrowed under the JPMorgan Credit Facility. 60 Table of Contents Critical Accounting Policies and Estimates The process of preparing our consolidated financial statements in conformity with U.S.
As of June 30, 2024, no amounts have been borrowed under the JPMorgan Credit Facility. 55 Table of Contents Critical Accounting Policies and Estimates The process of preparing our consolidated financial statements in conformity with GAAP requires the use of estimates and judgments that affect the reported amounts of assets, liabilities, revenues, and expenses.
Operating Expenses Year Ended June 30, Change 2023 2022 Amount % (in thousands, except for percentages) Operating expenses: Research and development $ 93,851 $ 74,412 $ 19,439 26 % Sales and marketing 132,189 111,905 20,284 18 % General and administrative 81,031 86,127 (5,096 ) (6 )% Lease modification and impairment 1,601 — 1,601 * Total operating expenses $ 308,672 $ 272,444 $ 36,228 13 % * Not meaningful Research and Development Research and development expenses increased by $19.4 million, or 26%, for fiscal year 2023 compared to fiscal year 2022.
Operating Expenses Year Ended June 30, Change 2024 2023 Amount % (in thousands, except for percentages) Operating expenses: Research and development $ 113,634 $ 93,851 $ 19,783 21 % Sales and marketing 138,176 132,189 5,987 5 % General and administrative 87,243 81,031 6,212 8 % Lease modification and impairment — 1,601 (1,601 ) * Total operating expenses $ 339,053 $ 308,672 $ 30,381 10 % * Not meaningful Research and Development Research and development expenses increased by $19.8 million, or 21%, for fiscal year 2024 compared to fiscal year 2023.
Some of our performance obligations have observable inputs that are used to determine the SSP of those distinct performance obligations.
Some of our performance obligations have observable inputs that are used to determine the SSP of those distinct performance obligations. Where SSP is not directly observable, we determine the SSP using information that may include market conditions and other observable inputs.
The majority of our contracts contain multiple performance obligations (such as when subscription licenses are sold with support and implementation services) and are typically capable of being distinct and accounted for as separate performance obligations. In a contract with multiple performance obligations, we allocate revenues to each performance obligation at the inception of the contract.
The estimates and assumptions requiring significant judgment under our revenue recognition policy are as follows: Identification of the performance obligations The majority of our contracts contain multiple performance obligations (such as when subscription licenses are sold with support and implementation services) and are typically capable of being distinct and accounted for as separate performance obligations.
These decreases were partially offset by an increase of $5.2 million in personnel-related costs primarily due to annual salary increases and increased headcount and an increase of $1.6 million in travel and company event related expenses.
Personnel-related costs increased by $6.1 million due to annual salary increase and increased headcount. Marketing expenses increased by $2.1 million largely due to increase in marketing events and travel related costs.
These increases were partially offset by a decrease of $2.0 million in stock-based compensation expense arising primarily from the reversal of stock-based compensation expense on forfeitures of unvested performance stock awards. 50 Table of Contents Sales and Marketing Sales and marketing expenses increased by $20.3 million, or 18%, for fiscal year 2023 compared to fiscal year 2022.
These increases were partially offset by a decrease of $3.1 million in stock-based compensation primarily due to forfeitures of unvested performance stock awards and the graded vesting of certain prior year grants which resulted in higher expense in the same period in prior year. 50 Table of Contents General and Administrative General and administrative expense increased by $6.2 million, or 8%, for fiscal year 2024 compared to fiscal year 2023.
See Note 6 to our consolidated financial statements for additional information. 58 Table of Contents Non-GAAP Financial Measures We report our financial results in accordance with GAAP, however, management believes evaluating our ongoing operating results may be enhanced if investors have additional non-GAAP financial measures.
Non-GAAP Financial Measures We report our financial results in accordance with generally accepted accounting principles in the United States of America (“GAAP”), however, management believes evaluating our ongoing operating results may be enhanced if investors have additional non-GAAP financial measures.
During fiscal year 2022, net cash used in investing activities was $7.3 million, consisting of $2.5 million of cash consideration paid for our acquisition of Billstream, capitalized internal-use software costs of $4.2 million and capital expenditures of $0.6 million.
During fiscal year 2024, net cash used in investing activities was $19.8 million, consisting of $11.0 million cash consideration paid, net of cash acquired for the acquisitions of delphai and TDI, capitalized internal-use software costs of $6.4 million and capital expenditures of $2.4 million on property and equipment largely of computer equipment and website development costs.
Non-GAAP Gross Profit We define non-GAAP gross profit as GAAP gross profit before the portion related to cost of revenues of stock-based compensation expense and amortization of intangible assets. We believe non-GAAP gross profit provides investors and other users of our financial information consistency and comparability with our past financial performance and facilitates period-to-period comparisons of gross profit.
Non-GAAP Gross Profit We define non-GAAP gross profit as GAAP gross profit less the portion related to cost of revenues of stock-based compensation expense, amortization of intangible assets and restructuring and other costs.
In addition to the obligations described above, in connection with the acquisition of Billstream, we are also obligated to pay contingent consideration in the second quarter of fiscal year 2024 up to a maximum of $5.0 million and by the third quarter of fiscal 2025, a maximum of $6.4 million in connection with the acquisition of Paragon, if certain performance measures are achieved.
In connection with the acquisition of Paragon, we are also obligated to pay contingent consideration in the third quarter of fiscal year 2025, a maximum of $3.9 million, if certain performance measures are achieved. See Note 6 to our consolidated financial statements for additional information.
During fiscal year 2022, net cash provided by financing activities was $6.6 million, primarily comprised of $292.8 million in net proceeds from our IPO completed in July 2021, $10.2 million of proceeds from stock option exercises and $1.2 million of proceeds from employee stock purchase plan, partially offset by $278.0 million used for the repayment of borrowings, $10.4 million of payment for contingent consideration related to the acquisition of Repstor, $4.4 million of payments related to deferred offering costs in connection with our IPO, $3.9 million of payments related to tax withholding for vested equity awards and $0.8 million of payments related to deferred financing costs in connection with our JPMorgan Credit Facility.
Financing Activities During fiscal year 2024, net cash provided by financing activities was $30.3 million, primarily comprised of $30.7 million of proceeds from stock option exercises and $3.4 million of proceeds from employee stock purchase plan, partially offset by $3.0 million of payments for the final contingent consideration and cash holdback related to prior acquisitions and $0.8 million of payments related to deferred offering costs in connection with our follow-on public offering.
Contracts with a term other than one year are annualized by taking the committed contract value for the current period divided by number of days in that period then multiplying by 365. As a metric, ARR mitigates fluctuations in revenue recognition due to certain factors, including contract term and the sales mix of SaaS contracts and subscription licenses.
Annual Recurring Revenues (“ARR”) ARR represents the annualized recurring value of all active SaaS and on-premise subscription license contracts at the end of a reporting period. Contracts with a term other than one year are annualized by taking the committed contract value for the current period divided by number of days in that period then multiplying by 365.
The following table provides a reconciliation of GAAP operating loss to non-GAAP operating profit (loss) (in thousands): Year Ended June 30, 2023 2022 2021 GAAP operating loss $ (69,261 ) $ (99,456 ) $ (22,960 ) Adjusted to exclude the following: Stock-based compensation 67,769 77,514 18,566 Amortization of intangible assets 10,773 13,519 10,870 Lease modification and impairment 1,601 — — Change in fair value of contingent consideration (1,762 ) (639 ) — Acquisition-related transaction costs 1,366 1,939 1,557 Non-GAAP operating profit (loss) $ 10,486 $ (7,123 ) $ 8,033 Indebtedness On October 5, 2021, we entered into a Credit Agreement, as amended on June 6, 2022 and further amended on November 17, 2022, with a group of lenders led by JPMorgan.
The following table provides a reconciliation of GAAP operating loss to non-GAAP operating income (loss) (in thousands): Year Ended June 30, 2024 2023 2022 GAAP operating loss $ (32,191 ) $ (69,261 ) $ (99,456 ) Adjusted to exclude the following: Stock-based compensation 59,895 67,769 77,514 Amortization of intangible assets 11,029 10,773 13,519 Lease modification and impairment — 1,601 — Change in fair value of contingent consideration (3,290 ) (1,762 ) (639 ) Transaction costs (1) 2,685 1,366 1,939 Restructuring and other costs 598 — — Non-GAAP operating income (loss) $ 38,726 $ 10,486 $ (7,123 ) (1) Consists of acquisition-related transaction costs and costs related to certain non-capitalized offering-related expenses.
We expect our research and development expenses to continue to increase in absolute dollars for the foreseeable future as we continue to dedicate substantial internal resources to develop, improve and expand the functionality of our solutions.
We expect our research and development expenses to continue to increase in absolute dollars for the foreseeable future as we continue to dedicate substantial internal resources to develop, improve and expand the functionality of our solutions. 46 Table of Contents Sales and Marketing Our sales and marketing expenses consist primarily of costs incurred for personnel-related costs for our sales and marketing employees as well as commission payments to our sales employees, costs of marketing events and online advertising, allocations of various overhead and facilities costs and travel and entertainment expenses.
Contractor costs increased by $2.9 million due to incremental development activities related to our cloud offerings. Cloud hosting costs increased by $1.5 million due to increased usage in support of development activities. Allocated overhead costs increased by $0.7 million due to increased facility costs and headcount.
Allocated overhead costs increased by $1.7 million due to increased headcount. Cloud hosting costs increased by $1.6 million due to increased usage in support of development activities. Sales and Marketing Sales and marketing expenses increased by $6.0 million, or 5%, for fiscal year 2024 compared to fiscal year 2023.
Where SSP is not directly observable, we determine the SSP using information that may include market conditions and other observable inputs. 61 Table of Contents Stock-Based Compensation We calculate compensation expense related to stock option awards made to employees, consultants and directors based on the fair value of stock-based awards on the date of grant.
Stock-Based Compensation We calculate stock-based compensation expense related to stock option awards made to employees, consultants and directors based on the fair value of stock-based awards on the date of grant.
The decrease was mainly due to the full repayment of our debt under the Prior Credit Facility in July 2021. 54 Table of Contents Other Income (Expense), Net Year ended June 30, Change 2022 2021 Amount % (in thousands, except for percentages) Other income (expense), net $ (976 ) $ 1,276 $ (2,252 ) (176 )% The change in other income (expense), net, was primarily due to the impact of fluctuations in foreign currency rates on our monetary asset and liability balances denominated in currencies other than the U.S.
Interest and Other Income (Expense), net Year Ended June 30, Change 2024 2023 Amount % (in thousands, except for percentages) Interest and other income (expense), net $ 2,285 $ (659 ) $ 2,944 (447 )% The change in interest and other income (expense), net, was primarily due to interest income on our cash held in money market funds, offset by the impact of fluctuations in foreign currency rates on our monetary asset and liability balances denominated in currencies other than the U.S. dollar, primarily British pounds.
The estimates and assumptions requiring significant judgment under our revenue recognition policy in accordance with Accounting Standards Codification 606, Revenue from Contracts with Customers (“ASC 606”), are as follows: Determination of the transaction price We determine the transaction price based on the consideration to which we expect to be entitled in exchange for transferring our services and products to the client.
Determination of the transaction price We determine the transaction price based on the consideration to which we expect to be entitled in exchange for transferring our services and products to the client.
The following table provides a reconciliation of recurring gross profit to non-GAAP recurring gross profit (in thousands): Year Ended June 30, 2023 2022 2021 Total recurring revenues $ 301,280 $ 237,182 $ 190,038 Total cost of recurring revenues 53,022 51,177 40,644 Recurring gross profit 248,258 186,005 149,394 Adjusted to exclude the following: Stock-based compensation 1,705 1,258 250 Amortization of intangible assets 4,340 7,877 6,783 Non-GAAP recurring gross profit $ 254,303 $ 195,140 $ 156,427 59 Table of Contents Non-GAAP Operating Profit (Loss) We define non-GAAP operating profit (loss) as GAAP operating loss excluding stock-based compensation expense, amortization of intangible assets, lease modification and impairment, change in fair value of contingent consideration and acquisition-related transaction costs.
We believe non-GAAP recurring gross profit provides investors and other users of our financial information consistency and comparability with our past financial performance and facilitates period-to-period comparisons of recurring gross profit as management is focused on increasing sales associated with our recurring revenue stream. 54 Table of Contents The following table provides a reconciliation of recurring gross profit to non-GAAP recurring gross profit (in thousands): Year Ended June 30, 2024 2023 2022 SaaS and support $ 315,960 $ 252,310 $ 192,980 Subscription license 60,682 48,970 44,202 Total recurring revenues 376,642 301,280 237,182 Cost of revenues - SaaS and support 59,831 53,022 51,177 Total cost of recurring revenues 59,831 53,022 51,177 GAAP recurring gross profit 316,811 248,258 186,005 Adjusted to exclude the following: Stock-based compensation 2,292 1,705 1,258 Amortization of intangible assets 4,778 4,340 7,877 Non-GAAP recurring gross profit $ 323,881 $ 254,303 $ 195,140 Non-GAAP Operating Income (Loss) We define non-GAAP operating income (loss) as GAAP operating loss excluding stock-based compensation expense, amortization of intangible assets, lease modification and impairment, change in fair value of contingent consideration, transaction costs related to acquisitions and certain non-capitalized offering-related expenses and restructuring and other costs.
Unless otherwise noted, any reference to a year preceded by the word “fiscal” refers to the fiscal year ended June 30 of that year. Overview Intapp is a leading provider of industry-specific, cloud-based software solutions for the global professional and financial services industry.
Unless otherwise noted, any reference to a year preceded by the word “fiscal” refers to the fiscal year ended June 30 of that year. A discussion regarding our financial condition and results of operations for the fiscal year ended June 30, 2024 compared to the fiscal year ended June 30, 2023 is presented below.
Net Revenue Retention. We measure our ability to grow and retain ARR from existing clients using a metric we refer to as net revenue retention. We calculate this by starting with the ARR from the cohort of all clients as of the twelve months prior to the applicable fiscal period, or prior period ARR.
We calculate Cloud NRR by starting with the Cloud ARR from the cohort of all clients as of the twelve months prior to the applicable fiscal period, or prior period Cloud ARR. We then calculate the Cloud ARR from these same clients as of the current fiscal period, or current period Cloud ARR.
Cost of Professional Services Cost of professional services revenues increased by $10.5 million, or 22%, for fiscal year 2023 compared to fiscal year 2022, primarily due to an increase in personnel-related costs of $6.5 million due to salary raises and increased headcount, sub-contractor costs of $3.3 million, and other allocated overhead costs of $0.5 million as we expanded our teams to provide implementation and migration services to our growing client base.
This was partially offset by a $0.7 million decrease in contractor costs. Cost of Professional Services Cost of professional services revenues increased by $5.4 million, or 9%, for fiscal year 2024 compared to fiscal year 2023, primarily due to an increase in personnel-related costs of $4.8 million due to increased headcount and salary raises and sub-contractor costs of $1.1 million.
These increases were partially offset by a decrease of $5.0 million in stock-based compensation expense due to the reversal of stock-based compensation expense on forfeitures of unvested performance stock awards and achievement of performance milestones on previously granted awards in fiscal year 2022.
These increases were partially offset by a decrease of $6.1 million in stock-based compensation expense primarily due to forfeitures of unvested performance stock awards, and a decrease of $1.5 million from change in fair value of contingent consideration related to prior acquisitions.
We recognize forfeitures of stock-based awards as they occur. Determining the fair value of stock-based awards at the grant date requires significant judgement.
We recognize forfeitures of stock-based awards as they occur.
Actual amounts may differ from these estimates and judgments. A summary of our significant accounting policies is contained in Note 2 of our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K.
A summary of our significant accounting policies is contained in Note 2 of our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K. Revenue Recognition Revenue recognition requires judgment and the use of estimates, especially in identifying and evaluating the various non-standard terms and conditions in our contracts with clients and their effect on reported revenues.
Contractor and personnel-related costs increased by $11.0 million and $7.8 million, respectively, as we increased contract resources and our headcount to support on-going development of our cloud offerings. Cloud hosting costs increased by $2.0 million and allocated overhead costs increased by $0.5 million due to increased IT costs and headcount.
Personnel-related costs increased by $12.5 million due to annual salary increases and increased headcount. The increase in headcount was driven by the operational and organizational realignment of part of the development operations team to research and development. Contractor costs increased by $4.0 million as we increased contract resources to support on-going development of our cloud offerings.
Key Business Metrics We review a number of operating and financial metrics, including the following key metrics to evaluate our business, measure our performance, identify trends affecting our business, formulate business plans, and make strategic decisions. 44 Table of Contents Annual Recurring Revenues (“ARR”) ARR represents the annualized recurring value of all active SaaS and on-premise subscription contracts at the end of a reporting period.
Key Business Metrics We review a number of operating and financial metrics, including the following key metrics to help us evaluate our business, measure our performance and the effectiveness of our sales and marketing efforts, identify trends affecting our business, formulate business plans and budgets, and make strategic decisions.
ARR does not have any standardized meaning and may not be comparable to similarly titled measures presented by other companies. ARR should be viewed independently of revenues and deferred revenues and is not intended to be combined with or to replace either of those elements of our financial statements.
ARR should be viewed independently of revenues and deferred revenues and is not intended to be combined with or to replace either of those elements of our financial statements. ARR is not a forecast 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 clients.

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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 changeThese matters could harm our business, results of operations, or financial condition. Interest Rate Risk Our exposure to market risk for changes in interest rates relates primarily to our senior secured revolving credit facility of up to $100.0 million. As of September 7, 2023, we had no outstanding loan balance under this facility.
Biggest changeThese matters could harm our business, results of operations, or financial condition. Interest Rate Risk Our exposure to market risk for changes in interest rates relates primarily to our cash held in cash deposits and cash equivalents invested in money market funds and our senior secured revolving credit facility of up to $100.0 million.
Item 7A. Quantitative and Qualitati ve Disclosures About Market Risk. We are exposed to market risks in the ordinary course of our business, including foreign currency exchange, credit, inflation, and interest rate risks.
Item 7A. Quantitative and Qualitati ve Disclosures About Market Risk. We are exposed to market risks in the ordinary course of our business, including foreign currency exchange rate, credit, inflation, and interest rate risks.
Foreign Currency Exchange Risk Our reporting currency is the U.S. dollar and the functional currency for all of our foreign subsidiaries is the U.S. dollar, except Rekoop Ltd., which uses the British pound. The majority of our revenue and expenses are denominated in U.S. dollars.
Foreign Currency Exchange Rate Risk Our reporting currency is the U.S. dollar and the functional currency for all of our foreign subsidiaries is the U.S. dollar, except Rekoop Ltd., which uses the British pound. The majority of our revenue and expenses are denominated in U.S. dollars.
We have not experienced any material losses related to non-payment of receivables from individual or groups of clients due to loss of creditworthiness during fiscal years 2023, 2022 and 2021. We had one client that represented in excess of 10% of our accounts receivable balance at each of June 30, 2023 and 2022.
We have not experienced any material losses related to non-payment of receivables from individual or groups of clients due to loss of creditworthiness during fiscal years 2024, 2023 and 2022. We had one client that represented in excess of 10% of our accounts receivable balance at each of June 30, 2024 and 2023.
As a result, we will be exposed to increased interest rate risk if we draw down on the facility. 64 Table of Contents
As a result, we will be exposed to increased interest rate risk if we draw down on the facility. 58 Table of Contents
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As of June 30, 2024, we had cash and cash equivalents of $208.4 million held with multiple high credit quality financial institutions, including investments in money market funds. Our investments are subject to market risk due to changes in interest rates, which may affect our interest income.
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A hypothetical 100 basis points increase or decrease in interest rates would not have a material impact on our operating results or the fair value of our cash and cash equivalents over the next twelve months. As of June 30, 2024, we had no outstanding loan balance under our senior secured revolving credit facility.

Other INTA 10-K year-over-year comparisons