10q10k10q10k.net

What changed in MANHATTAN ASSOCIATES INC's 10-K — 2024 vs 2025

vs

Paragraph-level year-over-year comparison of MANHATTAN ASSOCIATES INC's 2024 and 2025 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 2025 report.

+396 added−372 removedSource: 10-K (2026-02-04) vs 10-K (2025-02-07)

Top changes in MANHATTAN ASSOCIATES INC's 2025 10-K

396 paragraphs added · 372 removed · 328 edited across 2 sections

Item 1. Business

Business — how the company describes what it does

98 edited+21 added−12 removed204 unchanged
Biggest changeOur failure to report accurately or achieve progress on our metrics timely could adversely affect our reputation, financial performance and business growth. Adverse litigation results could affect our business . From time to time, we may be involved in litigation relating to claims arising in the ordinary course of business, and occasionally legal proceeding not in the ordinary course.
Biggest changeFrom time to time, we may be involved in litigation relating to claims arising in the ordinary course of business, and occasionally legal proceeding not in the ordinary course. Litigation can be lengthy, expensive and disruptive to our operations, and can divert our management’s attention away from running our core business.
Our customers include many of the world’s premier and most profitable brands. We run our Manhattan Active® applications in the cloud and deliver them as subscription-based software as a service (SaaS), and its architecture is highly differentiated among enterprise application providers, particularly within the Omni Channel and Supply Chain categories.
Our customers include many of the world’s premier and most profitable brands. We run our Manhattan Active® applications in the cloud and deliver them as subscription-based software as a service ("SaaS"). Its architecture is highly differentiated among enterprise application providers, particularly within the Omni Channel and Supply Chain categories.
Finally, Manhattan offers a unique Customer Engagement solution that enables contact center associates to see a holistic view of the customer, including a complete customer sales and interaction history, to better satisfy shopper needs while optimizing potential revenue 6 and profit opportunities through new orders, exchanges or a returns.
Finally, Manhattan offers a unique Customer Engagement solution that enables contact center associates to see a holistic view of the customer, including a complete customer sales and 6 interaction history, to better satisfy shopper needs while optimizing potential revenue and profit opportunities through new orders, exchanges or a returns.
Our quarterly revenue is difficult to forecast for several reasons, including the following: global macro-economic disruptions; credit and equity market disruptions, which can significantly impact capital availability and spend timing of customers or potential customers; the varying sales cycle for our products and services from customer to customer, including multiple levels of authorization required by some customers; the varying demand for our products; customers’ budgeting and purchasing cycles; delays in our implementations at customer sites; timing of hiring new services employees and the rate at which these employees become productive; timing of introduction of new products; development and performance of our distribution channels; and timing of any acquisitions and related costs.
Our quarterly revenue is difficult to forecast for several reasons, including the following: global macro-economic disruptions; credit and equity market disruptions, which can significantly impact capital availability and spend timing of customers or potential customers; the varying sales cycle for our products and services from customer to customer, including multiple levels of authorization required by 21 some customers; the varying demand for our products; customers’ budgeting and purchasing cycles; delays in our implementations at customer sites; timing of hiring new services employees and the rate at which these employees become productive; timing of introduction of new products; development and performance of our distribution channels; and timing of any acquisitions and related costs.
These include: • general economic and business conditions; 21 • interest and inflation rates, trends and fluctuations of each, and efforts to control them; • financial and credit market fluctuations and bank failures; • overall demand for enterprise software and services; • governmental policy, budgetary constraints, potential U.S. federal government shutdowns or shifts in government spending priorities; • general geo-political developments, including political instability, economic sanctions, terrorist activities or international conflicts, such as the wars in Ukraine and the Middle East; and • currency exchange rate fluctuations.
These include: • general economic and business conditions; • interest and inflation rates, trends and fluctuations of each, and efforts to control them; • financial and credit market fluctuations and bank failures; • overall demand for enterprise software and services; • governmental policy, budgetary constraints, potential U.S. federal government shutdowns or shifts in government spending priorities; • general geo-political developments, including political instability, economic sanctions, terrorist activities or international conflicts, such as the wars in Ukraine and the Middle East; and • currency exchange rate fluctuations.
International sales are subject to many risks and difficulties, including those arising from complying with a variety of foreign laws, import and export restrictions and tariffs, reduced protection for intellectual property rights in some countries, 20 potential adverse tax treatment, less stringent adherence to ethical and legal standards by prospective customers in some countries, language and cultural barriers and political and economic instability.
International sales are subject to many risks and difficulties, including those arising from complying with a variety of foreign laws, import and export restrictions and tariffs, reduced protection for intellectual property rights in some countries, potential adverse tax treatment, less stringent adherence to ethical and legal standards by prospective customers in some countries, language and cultural barriers and political and economic instability.
Our use of third-party generative AI tools exposes us to greater risks related to the quality of our products (for further information regarding this risk, see the risk factor entitled “ Our ability to sell our cloud solutions is highly dependent on the quality of our services offerings, and our failure to offer high quality services could adversely impact our business, results of operations, cash flow, and financial condition ”).
Our use of third-party generative and agentic AI tools exposes us to greater risks related to the quality of our products (for further information regarding this risk, see the risk factor entitled “ Our ability to sell our cloud solutions is highly dependent on the quality of our services offerings, and our failure to offer high quality services could adversely impact our business, results of operations, cash flow, and financial condition ”).
As a result, our sensitive information or that of our employees or customers could be leaked or disclosed, or other IT security incidents may arise (for further information regarding this risk, see the risk factor entitled “ If our data protection or other security measures are compromised and, as a result, our data, our customers’ data or our IT systems are accessed improperly, made unavailable, or improperly modified, our products and services may be perceived as vulnerable… ”).
As a result, our sensitive information or that of our employees or customers could be leaked or disclosed, or other IT security incidents may arise (for further information regarding this risk, see the risk factor entitled “ If our data protection or other security measures are compromised and, as 15 a result, our data, our customers’ data or our IT systems are accessed improperly, made unavailable, or improperly modified, our products and services may be perceived as vulnerable… ”).
Our developers may use, in limited instances, generative AI tools to support their computer code writing activities for our proprietary software products. According to recent decisions of governmental entities and courts (such as the U.S. Copyright Office and U.S. Court of Appeals for the Federal Circuit), U.S. copyright is limited to protecting works created by human authors.
Our developers may use, in limited instances, generative and agentic AI tools to support their computer code writing activities for our proprietary software products. According to recent decisions of governmental entities and courts (such as the U.S. Copyright Office and U.S. Court of Appeals for the Federal Circuit), U.S. copyright is limited to protecting works created by human authors.
If our customers decide to discontinue the cloud subscription, or if they reduce the scope of their professional services agreements, our revenue could decrease significantly, and that could have a material adverse effect on our business, results of operations, cash flow and financial condition. We depend on third-party data centers to provide our cloud-based solutions.
If our customers decide to discontinue the cloud subscription, or if they reduce the scope of their professional services agreements, our revenue could 13 decrease significantly, and that could have a material adverse effect on our business, results of operations, cash flow and financial condition. We depend on third-party data centers to provide our cloud-based solutions.
Further, we may experience in the future periodic interruptions, delays, and outages in service and availability with our data center providers due to a variety of factors, including Internet connectivity failures, infrastructure changes, human or software errors, website hosting disruptions, and capacity constraints. 13 Remediation of any service interruptions may take significant time.
Further, we may experience in the future periodic interruptions, delays, and outages in service and availability with our data center providers due to a variety of factors, including Internet connectivity failures, infrastructure changes, human or software errors, website hosting disruptions, and capacity constraints. Remediation of any service interruptions may take significant time.
Any such price modifications would likely reduce margins and could adversely affect our business, results of operations, cash flow, and financial condition. 15 We may encounter long sales cycles, particularly with our larger customers, which could have an adverse effect on the amount, timing, and predictability of our revenue, adversely affecting our business, results of operations, cash flow, and financial condition.
Any such price modifications would likely reduce margins and could adversely affect our business, results of operations, cash flow, and financial condition. We may encounter long sales cycles, particularly with our larger customers, which could have an adverse effect on the amount, timing, and predictability of our revenue, adversely affecting our business, results of operations, cash flow, and financial condition.
If a patent claim against us were successful and we could not obtain a license on acceptable terms or license a substitute technology or redesign the product or feature to avoid infringement, we may be prevented from distributing our software or required to incur significant expense and delay in developing non-infringing software.
If a patent claim against us were successful and we could not obtain a license on acceptable 19 terms or license a substitute technology or redesign the product or feature to avoid infringement, we may be prevented from distributing our software or required to incur significant expense and delay in developing non-infringing software.
These alliances extend our market coverage and provide us with new business leads and access to trained implementation personnel. Acquire or Invest in Complementary Businesses. We evaluate strategic acquisition opportunities of technologies, solutions and businesses that are consistent with our platform-based strategy and enable us to enhance and expand our offerings.
These alliances extend our market coverage and provide us with new business leads and access to trained implementation personnel. 9 Acquire or Invest in Complementary Businesses. We evaluate strategic acquisition opportunities of technologies, solutions and businesses that are consistent with our platform-based strategy and enable us to enhance and expand our offerings.
If we or our partners do not efficiently and effectively install and deploy our software products, or succeed in helping our customers quickly resolve post-deployment issues, our ability to sell software products to these customers would be adversely affected and our reputation in the marketplace with potential customers could suffer.
If we or our partners do not efficiently and effectively install and deploy our software products, or succeed in helping our customers quickly 14 resolve post-deployment issues, our ability to sell software products to these customers would be adversely affected and our reputation in the marketplace with potential customers could suffer.
We use generative AI tools in our business for external purposes (e.g., as additional features to our software products) and for internal purposes (e.g., to support our operations and improve the day-to-day performance of our employees), and these tools are mostly developed and marketed by third-party vendors.
We use generative and agentic AI tools in our business for external purposes (e.g., as additional features to our software products) and for internal purposes (e.g., to support our operations and improve the day-to-day performance of our employees), and these tools are mostly developed and marketed by third-party vendors.
If the developers of these computing platforms do not cooperate with us or we are unable to devote the necessary resources so that our applications interoperate with those computing platforms, our software development efforts may be 18 delayed and our business and results of operations may be adversely affected.
If the developers of these computing platforms do not cooperate with us or we are unable to devote the necessary resources so that our applications interoperate with those computing platforms, our software development efforts may be delayed and our business and results of operations may be adversely affected.
Our marketing efforts and lead generation activities consist primarily of press and industry analyst relations, customer endorsements, content marketing, digital marketing including social media such as LinkedIn, Twitter and YouTube, advertising, trade shows, industry events, joint marketing with strategic partners, and targeted lead generation through account-based marketing.
Our marketing efforts and lead generation activities consist primarily of press and industry analyst relations, customer endorsements, content marketing, digital marketing including social media such as LinkedIn, YouTube, advertising, trade shows, industry events, joint marketing with strategic partners, and targeted lead generation through account-based marketing.
However, because the use of generative AI tools in business environments is a relatively novel development, the extent of benefits, risks, and liabilities attached to it are still unknown. We have identified the following main risks related to our use of AI tools: • Protection of our proprietary rights.
However, because the use of generative and agentic AI tools in business environments is a relatively novel development, the extent of benefits, risks, and liabilities attached to it are still unknown. We have identified the following main risks related to our use of AI tools: • Protection of our proprietary rights.
We may from time to time acquire companies with complementary products and 17 services. These acquisitions will expose us to increased risks and costs, including those arising from the following: assimilating new operations and personnel; diverting financial and management resources from existing operations; and integrating acquired technologies.
We may from time to time acquire companies with complementary products and services. These acquisitions will expose us to increased risks and costs, including those arising from the following: assimilating new operations and personnel; diverting financial and management resources from existing operations; and integrating acquired technologies.
Significant investments may be required in order to maintain and develop our brand. However, the investments may later be proven to be unsuccessful. If we fail to maintain and develop our brand, or if we incur excessive expenses in our efforts to do so, our business, operating results and financial condition may be materially and adversely affected.
Significant investments may be required in order to maintain and develop our brand. However, the investments may later be proven to be unsuccessful. If we fail to maintain and develop 16 our brand, or if we incur excessive expenses in our efforts to do so, our business, operating results and financial condition may be materially and adversely affected.
As complexity continues to grow for our customers, Manhattan provides value by eliminating the need to design, build and maintain complex system to system integration. Manhattan’s Supply Chain Solutions are focused on the distribution and transportation operations of the enterprise.
As complexity continues to grow for our customers, Manhattan provides value by eliminating the need to design, build, and maintain complex system to system integration. 5 Manhattan’s Supply Chain Solutions are focused on the distribution and transportation operations of the enterprise.
In addition, certain open 19 source software licenses require the user of such software to make any derivative works of the open source code available to others on unfavorable terms or at no cost. This can subject previously proprietary software to open source license terms.
In addition, certain open source software licenses require the user of such software to make any derivative works of the open source code available to others on unfavorable terms or at no cost. This can subject previously proprietary software to open source license terms.
We believe our solutions are uniquely positioned to holistically optimize the way companies bring together omnichannel, supply chain and inventory management: Develop and Enhance Software Solutions. We continue to focus our research and development resources on enhancing our Supply Chain, Omnichannel Commerce and Inventory Solutions.
We believe our solutions are uniquely positioned to holistically optimize the way companies bring together omnichannel, supply chain, and inventory management: Develop and Enhance Software Solutions. We continue to focus our research and development resources on enhancing our Supply Chain, Omnichannel Commerce and Supply Chain Planning Solutions.
Our use of generative artificial intelligence (“AI”) tools may expose us to operational, compliance or other risks, which could adversely impact our business, results of operations, cash flow and financial condition, and subject us to legal liability.
Our use of generative and agentic artificial intelligence (“AI”) tools may expose us to operational, compliance or other risks, which could adversely impact our business, results of operations, cash flow and financial condition, and subject us to legal liability.
From warehouse management to POS, our solutions are consistently at the top of the market with respect to configurability, capability and usability. Customers choose Manhattan applications to solve the industry’s most complex supply chain problems.
From warehouse management to POS, our solutions are consistently at the top of the market with respect to configurability, capability and usability. Customers choose Manhattan applications to solve the industry’s most complex supply chain and commerce problems.
There are two main components of Manhattan’s Supply Chain Solutions: 5 • Distribution Management - These applications comprise Manhattan’s Warehouse Management Solutions (WMS) commonly used to manage the complexity of the modern distribution center. WMS manages the flow of goods and information across the distribution center.
There are two main components of Manhattan’s Supply Chain Solutions: • Distribution Management - These applications comprise Manhattan’s Warehouse Management Solutions (WMS) commonly used to manage the complexity of the modern distribution center. WMS manages the flow of goods and information across the distribution center.
Policing 11 unauthorized use of our products is difficult, and, while we are unable to determine the extent to which piracy of our software solutions exists, as is the case with any software company, piracy could become a problem.
Policing unauthorized use of our products is difficult, and, while we are unable to determine the extent to which piracy of our software solutions exists, as is the case with any software company, piracy could become a problem.
A future pandemic or other public health crisis, and related remedial measures, could adversely impact our results from operations, financial condition, liquidity and cash flows in numerous ways, including but not limited to: • any such crisis could reduce the availability or productivity of our workforce impacting our day-to-day operations and ability to meet our customer obligations; • customer demand for our products could decline or they may request extended payment terms for products purchased due to their need to reduce their information technology expense or preserve cash, or as a result of reductions in their sales and profits; • customers could file for bankruptcy; • forced store closures could accelerate pre-existing disruption in the retail sector; and 22 • the spending habits of our customers’ customers could change, reducing our customers’ own revenues and profitability, which in turn could affect our revenues and profitability.
A future disease outbreak, pandemic, or other public health crisis, and related remedial measures, could adversely impact our results from operations, financial condition, liquidity and cash flows in numerous ways, including but not limited to: • any such crisis could reduce the availability or productivity of our workforce impacting our day-to-day operations and ability to meet our customer obligations; • customer demand for our products could decline or they may request extended payment terms for products purchased due to their need to reduce their information technology expense or preserve cash, or as a result of reductions in their sales and profits; • customers could file for bankruptcy; • forced store closures could accelerate pre-existing disruption in the retail sector; and • the spending habits of our customers’ customers could change, reducing our customers’ own revenues and profitability, which in turn could affect our revenues and profitability.
Our current 16 competitors come from many segments of the software industry and offer a variety of solutions directed at various aspects of the extended supply chain, as well as the enterprise as a whole.
Our current competitors come from many segments of the software industry and offer a variety of solutions directed at various aspects of the extended supply chain, as well as the enterprise as a whole.
In addition, we have little insight into, and no control over, the content used or provided by third-party vendors to train their generative AI tools.
In addition, we have little insight into, and no control over, the content used or provided by third-party vendors to train their generative and agentic AI tools.
A decrease in revenues could also negatively affect our liquidity, as we primarily rely on cash generated from operating activities for our liquidity needs. Compounding this issue, a pandemic or other public health crisis may make outside capital less available or more expensive. Fires or other catastrophic events at our principal facilities could disrupt our business.
A decrease in revenues could also negatively affect our liquidity, as we primarily rely on cash generated from operating activities for our liquidity needs. Compounding this issue, a disease outbreak, pandemic, or other public health crisis may make outside capital less available or more expensive. Fires or other catastrophic events at our principal facilities could disrupt our business.
In addition, the vendors of these tools may fail to comply with their contractual obligations to us, or not provide warranties, indemnities or other remedies, regarding the confidentiality or security of this content. Further, our use of generative AI tools to generate computer code may present additional security risks because the generated source code may contain security vulnerabilities.
In addition, the vendors of these tools may fail to comply with their contractual obligations to us, or not provide warranties, indemnities or other remedies, regarding the confidentiality or security of this content. Further, our use of generative and agentic AI tools to generate computer code may present additional security risks because the generated source code may contain security vulnerabilities.
We face competition for product sales from: • Corporate information technology departments of current or potential customers capable of internally developing solutions; • ERP vendors, including: Oracle, SAP, and Infor, among others; • Supply chain execution and planning vendors, including Blue Yonder/Panasonic (formerly JDA), Korber (formerly HighJump), SAS Institute, the Sterling Commerce division of IBM, Relex, and others; • POS vendors, including Aptos, Oracle, and others; and • Smaller independent companies that have developed or are attempting to develop supply chain execution solutions or planning solutions that apply either globally or in specific countries.
We face competition for product sales from: • Corporate information technology departments of current or potential customers capable of internally developing solutions; • ERP vendors, including: Oracle, SAP, and Infor, among others; • Supply chain execution and planning vendors, including Blue Yonder/Panasonic (formerly JDA), E2Open, Korber (formerly HighJump), SAS Institute, the Sterling Commerce division of IBM, Relex, and others; • POS vendors, including Aptos, Oracle, Jumpmind, Salesforce and others; and • Smaller independent companies that have developed or are attempting to develop supply chain execution solutions or planning solutions that apply either globally or in specific countries.
Inventory Solutions The ability to accurately forecast demand and project inventory needs is heightened by omnichannel retail requirements that change traditional approaches to inventory management.
The ability to accurately forecast demand and project inventory needs is heightened by omnichannel retail requirements that change traditional approaches to inventory management.
No single customer accounted for more than 10% of our total revenue in 2024, 2023 and 2022. Product Development We focus our development efforts on new product innovation and on adding new functionality to existing solutions; integrating our various solution offerings; and enhancing the operability of our solutions across our platforms.
No single customer accounted for more than 10% of our total revenue in 2025, 2024, and 2023. Product Development We focus our development efforts on new product innovation and on adding new functionality to existing solutions; integrating our various solution offerings; and enhancing the operability of our solutions across our platforms.
In March 2020, the World Health Organization declared the outbreak of the COVID-19 pandemic. The disease spread throughout the world, prompting governmental and private authorities to implement measures to contain the pandemic, including travel bans and restrictions, quarantines, shelter-in-place orders, and business limitations and shutdowns.
For example, in March 2020, the World Health Organization declared the outbreak of the COVID-19 pandemic. The disease spread throughout the world, prompting governmental and private authorities to implement measures to contain the pandemic, including travel bans and restrictions, quarantines, shelter-in-place orders, and business limitations and shutdowns.
Item 1. Business Overview Manhattan Associates was founded in 1990 in Manhattan Beach, California and incorporated in Georgia in 1998. References in this filing to the “Company,” “Manhattan,” “Manhattan Associates,” “we,” “our” and “us” refer to Manhattan Associates, Inc., our predecessors, and our wholly-owned and consolidated subsidiaries.
Item 1. Business Overview Manhattan Associates was founded in 1990 in Manhattan Beach, California and incorporated in Georgia in 1998. References in this filing to the “Company,” “Manhattan,” “Manhattan Associates,” “we,” “our,” and “us” refer to Manhattan Associates, Inc., our predecessors, and our wholly-owned and consolidated subsidiaries.
Existing competitors include: • Corporate information technology departments of current or potential customers capable of internally developing solutions; • ERP vendors, including: Oracle, SAP and Infor, among others; • Supply chain execution and planning vendors, including Blue Yonder/Panasonic (formerly JDA), Korber (formerly HighJump), SAS Institute, the Sterling Commerce division of IBM, Relex, and others; • POS vendors, including Aptos, Oracle, and others; and • Smaller independent companies that have developed or are attempting to develop supply chain execution solutions or planning solutions that apply either globally or in specific countries.
Existing competitors include: • Corporate information technology departments of current or potential customers capable of internally developing solutions; • ERP vendors, including: Oracle, SAP and Infor, among others; • Supply chain execution and planning vendors, including Blue Yonder/Panasonic (formerly JDA), E2Open, Infios (formerly Korber, HighJump), SAS Institute, the Sterling Commerce division of IBM, Relex, and others; • POS vendors, including Aptos, Oracle, Jumpmind, Salesforce and others; and • Smaller independent companies that have developed or are attempting to develop supply chain execution solutions or planning solutions that apply either globally or in specific countries.
Generally, because we mainly use generative AI tools that are developed by third-party vendors, we have lesser control over the further use or distribution of any content we may share or create via these third-party tools.
Generally, because we mainly use generative and agentic AI tools that are developed by third-party vendors, we have lesser control over the further use or distribution of any content we may share or create via these third-party tools.
WMS is delivered for new and upgrading customers in the form of Manhattan Active Warehouse Management (MAWM), a cloud native and versionless application that delivers new innovation on a quarterly basis.
WMS is delivered for new and upgrading customers in the form of Manhattan Active Warehouse Management (MAWM), a versionless, cloud-based application that delivers innovation on a quarterly basis.
Additionally, certain privacy laws may apply to our use of generative AI tools (such as a data subject’s right to have a precise view of how their personal data are processed).
Additionally, certain privacy laws may apply to our use of generative and agentic AI tools (such as a data subject’s right to have a precise view of how their personal data are processed).
Fires, natural disasters, weather events, political unrest, disruptions in critical infrastructure or other catastrophic events, particularly those affecting our Atlanta headquarters or India research and development center, may cause damage or disruption to our operations, and thus could have a strong negative effect on us.
Fires, natural disasters, weather events, political or civil unrest, terrorist acts, disruptions in critical infrastructure or other catastrophic events, particularly those affecting our Atlanta headquarters or India research and development center, may cause damage or disruption to our operations, and thus could have a strong negative effect on us.
We also offer certain solutions in either on-premise software or cloud computing models so that customers can select the option that best meets their requirements for control, flexibility, cost of ownership and time-to-deployment. We continually invest in artificial intelligence (AI) technology to enhance our functional offerings, with a recent emphasis on generative AI (GenAI) advancements.
We also offer certain solutions in either on-premise software or cloud 7 computing models so that customers can select the option that best meets their requirements for control, flexibility, cost of ownership and time-to-deployment. We continually invest in artificial intelligence (AI) technology to enhance our functional offerings, with a recent emphasis on Agentic AI advancements.
We have offices in Australia, Chile, China, France, Germany, India, Italy, Japan, the Netherlands, Singapore, Spain, the United Kingdom, and the United States, as well as representatives in Mexico and reseller partnerships in Latin America, Eastern Europe, the Middle East, South Africa, and Asia. As of December 31, 2024, we employed approximately 4,690 employees worldwide.
We have offices in Australia, Chile, China, France, Germany, India, Italy, Japan, the Netherlands, Singapore, Spain, the United Kingdom, and the United States, as well as representatives in Mexico and reseller partnerships in Latin America, Eastern Europe, the Middle East, South Africa, and Asia. As of December 31, 2025, we employed approximately 4,370 employees worldwide.
For example: • Generative AI features embedded in our software products may create incomplete or inaccurate outputs and this could result in customer dissatisfaction or potential claims related to product performance (for further information regarding this risk, see the risk factor entitled “ Our software may contain undetected errors or “bugs” causing harm to our reputation, which could adversely impact our business, results of operations, cash flow, and financial condition ”); • Our use of third-party generative AI tools to power features of our software products may impair our ability to correct defects or cure unavailability in a timely manner because we have no control over our third-party vendors’ operations and infrastructure (for further information regarding this risk, see the risk factor entitled “ We incorporate third-party software in our solutions, the failure or unavailability of which could adversely affect our ability to sell, support, and service our products ”). • Cybersecurity and Third-Party Rights .
For example: • Generative and agentic AI features embedded in our software products may create incomplete, inaccurate, unwanted or offensive outputs and may cause our software products not to operate as expected, and this could result in customer dissatisfaction or potential claims related to product performance (for further information regarding this risk, see the risk factor entitled “ Our software may contain undetected errors or “bugs” causing harm to our reputation, which could adversely impact our business, results of operations, cash flow, and financial condition ”); • Our use of third-party generative and agentic AI tools to power features of our software products may impair our ability to correct defects or cure unavailability in a timely manner because we have no control over our third-party vendors’ operations and infrastructure (for further information regarding this risk, see the risk factor entitled “ We incorporate third-party software in our solutions, the failure or unavailability of which could adversely affect our ability to sell, support, and service our products ”). • Cybersecurity and Third-Party Rights .
Our marketing strategy is to promote our brand, differentiate our value proposition, and generate demand for our offerings. We use multi-channel global marketing programs to reach new prospects and expand relationships with current customers.
Our marketing strategy is to promote our brand, differentiate our value proposition, highlight customer success, and generate demand for our offerings. We use multi-channel global marketing programs to reach new prospects and expand relationships with current customers.
Leads are qualified and opportunities are closed through a process that includes telephone-based assessments of requirements, responses to requests for proposals, presentations and product demonstrations, site visits and reference calls with organizations already using our supply chain solutions, and contract negotiations. Sales cycles vary substantially from opportunity to opportunity, but typically require nine to twelve months.
We qualify leads and close opportunities through a process that includes telephone-based assessments of requirements, responses to requests for proposals, presentations and product demonstrations, site visits, and reference calls with organizations already using our supply chain solutions, and contract negotiations. Sales cycles vary substantially from opportunity to opportunity, but typically require nine to twelve months.
Customers To date, our customers have been suppliers, manufacturers, distributors, retailers, and logistics providers in a variety of industries. Our top five customers (new or pre-existing) in the aggregate accounted for 12%, 11%, and 11% of total revenue for the year ended December 31, 2024, the year ended December 31, 2023, and the year ended December 31, 2022, respectively.
Customers To date, our customers have been suppliers, manufacturers, distributors, retailers, and logistics providers in a variety of industries. Our top five customers (new or pre-existing) in the aggregate accounted for 10%, 12%, and 11% of total revenue for the years ended December 31, 2025, 2024, and 2023, respectively.
Manhattan Associates develops modern commerce solutions that help its customers in three distinct areas of their business: • Supply Chain Execution - We provide companies the tools needed to manage distribution and optimize transportation costs throughout their entire commercial network.
Manhattan Associates develops modern, cloud-based, supply chain commerce solutions that help our customers in three distinct areas of their business: • Supply Chain Execution - We provide companies with the tools needed to manage distribution and optimize transportation costs throughout their entire commercial network.
In addition, political unrest and the related potential impact on global stability, acts of war or terrorism and the potential for other hostilities in various parts of the world, as well as potential public health crises and natural disasters continue to contribute to a climate of economic and political uncertainty that could adversely affect our results of operations and financial condition, including our revenue growth and profitability.
In addition, political unrest and the related potential impact on global stability, acts of war or terrorism and the potential for other hostilities in various parts of the world, as well as potential public health crises and natural disasters continue to contribute to a climate of economic and political uncertainty that could adversely affect our results of operations and financial condition, including our revenue growth and profitability. 22 Changes in, or interpretation of, accounting principles could result in unfavorable accounting changes.
Our research and development activities may not generate significant returns. We anticipate continuing to make significant investments in software research and development (R&D) and related product opportunities because we believe that we must continue to allocate significant resources to our research and development activities to compete successfully.
We anticipate continuing to make significant investments in software research and development (R&D) and related product opportunities because we believe that we must continue to allocate significant resources to our research and development activities to compete successfully.
Many other jurisdictions around the world follow the same approach. 14 We may therefore face challenges in obtaining U.S. copyright or other intellectual property rights worldwide on certain parts of our products that were developed using generative AI tools (for further information regarding this risk, see the risk factor entitled “ Our failure to adequately protect our proprietary rights could adversely impact our business, results of operations, cash flow, and financial condition ”). • AI adoption-related risk.
We may therefore face challenges in obtaining U.S. copyright or other intellectual property rights worldwide on certain parts of our products that were developed using generative and agentic AI tools (for further information regarding this risk, see the risk factor entitled “ Our failure to adequately protect our proprietary rights could adversely impact our business, results of operations, cash flow, and financial condition ”). • AI adoption-related risk.
Manhattan’s Transportation Management Solutions (TMS) are designed to help shippers navigate their way through these demands while meeting customer service expectations at the lowest possible freight costs. TMS components include procurement and modeling tools to setup a successful network, along with planning, execution and settlement tools to manage day-to-day transportation requirements.
The Manhattan Active Transportation Management Solution (TMS) is designed to help shippers navigate their way through these demands while meeting customer service expectations at the lowest possible freight costs. TMS components include procurement and modeling tools to setup a successful network, along with planning, execution and settlement tools to manage day-to-day transportation requirements.
Changes in, or interpretation of, accounting principles could result in unfavorable accounting changes. Our Consolidated Financial Statements are prepared in conformity with U.S. generally accepted accounting principles (GAAP) and accompanying accounting pronouncements, implementation guidelines, and interpretations. These rules are subject to interpretation by the SEC and various bodies formed to interpret and create appropriate accounting principles.
Our Consolidated Financial Statements are prepared in conformity with U.S. generally accepted accounting principles (GAAP) and accompanying accounting pronouncements, implementation guidelines, and interpretations. These rules are subject to interpretation by the SEC and various bodies formed to interpret and create appropriate accounting principles.
(at state and federal level), have proposed or already enacted legislative frameworks governing the development, use and marketing of AI tools, including the European Union’s AI Act and the Colorado AI Act. We expect other jurisdictions will adopt similar regulations.
Several jurisdictions around the globe, including in Europe and the U.S. (at state and federal level), have proposed or already enacted legislative frameworks governing the development, use and marketing of AI tools, including the European Union’s AI Act and the Colorado AI Act. We expect other jurisdictions will adopt similar regulations.
We prioritize continuous learning for our employees, offering diverse learning opportunities for skill enhancement and growth. 12 Well-being: We support the mental, emotional, physical, and financial well-being of our employees around the world with various company-provided programs and self-service tools, including free virtual mental health counseling, free gym access in certain locations, and free educational webinars, speakers, and other resources for personal financial and benefit plan management.
Well-being: We support the mental, emotional, physical, and financial well-being of our employees around the world with various company-provided programs and self-service tools, including free virtual mental health counseling, free gym access in certain locations, and free educational webinars, speakers, and other resources for personal financial and benefit plan management.
If our products fail to function as required—which, as described in more detail in other risk factors, could be due to software bugs, cloud hosting service failures, security breaches, faulty implementations or other reasons—we may be subject to claims for substantial damages.
If our products fail to function as required—which, as described in more detail in other risk factors, could be due to software bugs, cloud hosting service failures, security breaches, faulty implementations, risks associated with our use of generative and agentic artificial intelligence, or other reasons—we may be subject to claims for substantial damages.
We do not maintain hardware inventory as we generally purchase hardware from vendors only after receiving related customer orders. 8 Strategy Our objective is to extend our position as the leading global commerce solutions provider for organizations intent on creating and sustaining market advantages through technology-enabled commerce solutions.
We purchase hardware from our vendors only after receiving an order from a customer. As a result, we do not maintain hardware inventory. Strategy Our objective is to extend our position as the leading global supply chain and omnichannel commerce solutions provider for organizations intent on creating and sustaining market advantages through technology-enabled commerce solutions.
Manhattan Active solutions are sold directly in multi-year cloud subscription arrangements, typically for a period of five years or more, providing clients with regular software updates during the contract period to ensure access to the latest product features and benefiting Manhattan with a predictable and regular revenue stream. Part of the key value proposition of Manhattan Active Platform is extensibility.
We sell our Manhattan Active solutions directly in multi-year cloud subscription arrangements, typically for a period of five years or more, providing clients with regular software updates during the contract period to ensure access to the latest product features and benefiting Manhattan with a predictable and regular revenue stream.
Professional Services We advise and assist our customers in planning and implementing our solutions through our global Professional Services Organization. To ensure successful long-term customer relationships, consultants assist customers with the initial deployment of our systems, the conversion and transfer of the customer’s historical data onto our systems, and ongoing training, education and system upgrades.
To ensure successful long-term customer relationships, consultants assist customers with the initial deployment of our systems, the conversion and transfer of the customer’s historical data onto our systems, and ongoing training, education and system upgrades.
For example, there is ongoing litigation over whether the use of copyrighted materials to train AI models is lawful, however the impact of its outcome on our ability to use certain generative AI tools is unknown. • Regulatory risks. Several jurisdictions around the globe, including in Europe and the U.S.
For example, there is ongoing litigation over whether the use of copyrighted materials to train AI models is lawful, however the impact of its outcome on our ability to use certain generative and agentic AI tools is unknown.
Manhattan Active WM runs on Google Cloud Platform, is offered exclusively via subscription, and includes state of the art fulfillment optimization technology, a consumer grade mobile app experience for the associate, and embedded gamification capabilities to improve associate engagement and performance.
Manhattan Active WM runs on Google Cloud Platform, is offered exclusively via subscription, and includes state-of-the-art-fulfillment optimization technology, a consumer grade mobile app experience for the associate, and embedded gamification capabilities to improve associate engagement and performance. Manhattan Active WM is fully configurable and technically extensible, meaning customers can build their own componentry to work alongside our base application.
Comprising Order Management, Store Inventory Fulfillment, Call Center, Point of Sale (POS), and Customer Engagement as their core applications, Manhattan Omnichannel solutions provide CRM capabilities for contact center agents; end-to-end process enablement for store associates, and enterprise-wide inventory availability determination, order fulfillment optimization, and POS capabilities. • Supply Chain Planning – Manhattan’s solutions provide distributors of finished goods (apparel, food, auto parts, pharmaceuticals, etc.) the ability to forecast demand, determine when, where and how much inventory is needed, and translate this into profitable inventory buying plans.
Comprising Order Management, Store Inventory & Fulfillment, Point of Sale (POS), and Customer Engagement & Service as their core applications, Manhattan provides CRM capabilities for contact center agents, end-to-end process enablement for store associates, and enterprise-wide inventory availability determination, order fulfillment optimization, and POS capabilities. • Supply Chain Planning – Manhattan’s supply chain planning solutions enable distributors of finished goods, such as apparel, food, automotive, and pharmaceuticals, to forecast demand and determine when, where, and how much inventory is required to achieve maximum profitability.
Our solutions help global distributors, wholesalers, retailers, logistics providers and manufacturers successfully manage accelerating and fluctuating market demands, as well as master the increasing complexity and volatility of their local and global supply chains. 10 The principal competitive factors affecting the markets for our solutions include: industry expertise; company and solution reputation; company viability; compliance with industry standards; solution architecture; solution functionality and features; integration experience, particularly with enterprise resource planning (ERP) providers and material handling equipment providers; ease and speed of implementation; proven return on investment; historical and current solution quality and performance; total cost of ownership; solution price; and ongoing solution support structure.
The principal competitive factors affecting the markets for our solutions include: industry expertise; company and solution reputation; company viability; compliance with industry standards; solution architecture; solution functionality and features; integration experience, particularly with enterprise resource planning (ERP) providers and material handling equipment providers; ease and speed of implementation; proven return on investment; historical and current solution quality and performance; total cost of ownership; solution price; and ongoing solution support structure.
Technology Platform Manhattan's Active Platform solutions are cloud-native products designed to provide “always current” version-less product access. The server side full stack runs exclusively on Google Cloud Platform, and end users can access the system from almost any type of device – mobile, tablet or desktop.
The server side full stack runs exclusively on Google Cloud Platform, and end users can access the system from almost any type of device: mobile, tablet, or desktop.
In addition to the business configurability offered within each line of business application, Manhattan Active Platform also allows our customers to change the underlying data model, the user interface, and the core business logic within each application. Key to this process is Manhattan ProActive, our developer enablement toolkit which allows for the types of technical modifications noted above (and more).
Part of the key value proposition of Manhattan Active Platform is extensibility. In addition to the business configurability offered within each line of business application, Manhattan Active Platform also allows our customers to change the underlying data model, the user interface, and the core business logic within each application.
While we do not anticipate that changes in the tax laws or rates in that Act will have a material, direct impact on the Company, imposition of new excise taxes and minimum corporate tax rates such as these can have a material adverse impact on the Company in the future.
While we do not anticipate that changes in the tax laws or rates in that Act will have a material, direct impact on the Company, imposition of new excise taxes and minimum corporate tax rates such as these can have a material adverse impact on the Company in the future. 20 We are also subject to non-income taxes, such as payroll, sales, use, value-added, net worth, property and goods and services taxes in the U.S. and various foreign jurisdictions.
We believe our application architecture delivers a versionless yet highly extensible experience for our customers. We offer our customers access to new innovation on a quarterly basis, ensuring all customers are running on a single fully up-to-date codebase.
We believe our application architecture delivers a versionless yet highly extensible experience for our customers. We offer our customers access to new innovation on a quarterly basis, ensuring all customers are running on a single fully up-to-date codebase. With AI-driven insights and zero downtime updates, Manhattan delivers innovation seamlessly into customer environments without the need for planned maintenance windows.
We have registered trademarks for Manhattan Associates and the Manhattan Associates logo, as well as a number of our products and features. Generally, we enter into confidentiality and assignment-of-rights agreements with our employees, consultants, customers and potential customers and limit access to, and distribution of, our proprietary information.
Generally, we enter into confidentiality and assignment-of-rights agreements with our employees, consultants, customers and potential customers and limit access to, and distribution of, our proprietary information.
We leverage internal and external scientific advisors to inform our solution strategies and research and development approaches with the most advanced thinking on supply chain opportunities, challenges and technologies.
As a result, we deliver packaged, highly configurable solutions with increasingly rich functionality rather than custom-developed software. 10 We leverage internal and external scientific advisors to inform our solution strategies and research and development approaches with the most advanced thinking on supply chain opportunities, challenges and technologies.
Manhattan’s Inventory solutions address which products should be carried and the quantity that will be needed at each location by date. • Inventory Optimization - This set of applications includes sophisticated demand forecasting capabilities that can address the particularly challenging slow-moving and intermittent products that frequently result in excess inventory due to unpredictability.
Manhattan’s Inventory solutions address which products should be carried and the quantity that will be needed at each location by date. • Demand Forecasting and Replenishment - Demand forecasting capabilities address complex demand patterns, including slow-moving and intermittent items that can contribute to excess inventory.
We are able to remotely access customer systems to perform diagnostics, provide online assistance, and facilitate software upgrades. We offer 24-hour customer support 365 days a year plus software upgrades for a pre-paid annual fee based on the specific solutions the customer has and the service level required. We provide software upgrades on a when-and-if-available basis.
We offer 24-hour customer support 365 days a year plus software upgrades for a pre-paid annual fee based on the specific solutions the customer has and the service level required. We provide software upgrades on a when-and-if-available basis. Professional Services We advise and assist our customers in planning and implementing our solutions through our global Professional Services Organization.
Hardware Sales As a convenience for our customers, we resell a variety of hardware developed and manufactured by others, including computer hardware, radio frequency terminal networks, radio frequency identification (RFID) chip readers, bar code printers and scanners, and other peripherals.
We offer Manhattan Training and Change Management Services under six categories: Role-Based Training Paths, Comprehensive Training Programs, Change Management Services, Individual Product Training Courses, End-User Enablement and Knowledge Resources. 8 Hardware Sales As a convenience for our customers, we resell a variety of hardware developed and manufactured by others, including computer hardware, radio frequency terminal networks, radio frequency identification (RFID) chip readers, bar code printers and scanners, and other peripherals.
Consequently, we cannot assure that we will not be required to make substantial additional investments in research, development, marketing, sales and customer service efforts in order to meet any competitive threat, or that we will be able to compete successfully in the future.
Consequently, we cannot assure that we will not be required to make substantial additional investments in research, development, marketing, sales and customer service efforts in order to meet any competitive threat, or that we will be able to compete successfully in the future. 11 International Operations: Segments We have three reportable segments based on geographic location: North and Latin America (“the Americas”); Europe, Middle East and Africa (“EMEA”); and Asia Pacific (“APAC”).
Our solutions address needs in various vertical markets, including retail, consumer goods, food and grocery, logistics service providers, industrial and wholesale, high technology and electronics, life sciences and government. We intend to continue to enhance our solutions to meet the dynamic requirements of these and new vertical markets as business opportunities dictate. Expand International Presence.
Our solutions address needs in various vertical markets, including retail, consumer goods, food and grocery, logistics service providers, industrial and wholesale, high technology and electronics, life sciences and government.
As we include generative AI features in our software products, some of our customers, especially those in highly regulated industries, may be reluctant or unwilling to use generative AI products. Accordingly, their reluctance to do so could reduce or delay customer adoption, and this may adversely affect our business, results of operations, and financial condition. • Operational risks.
Accordingly, their reluctance to do so could reduce or delay customer adoption, and this may adversely affect our business, results of operations, and financial condition. • Operational risks.
Likewise, we design our offerings to provide shippers and carriers the most comprehensive transportation management solutions in the market.
Our software helps optimize fulfillment models to support our customers across a wide range of channels and fulfillment methods. Likewise, we design our offerings to provide shippers and carriers the most comprehensive transportation management solutions in the market.
Consequently, a decline in new or renewed subscriptions in any one quarter may have a minimal impact on our revenue for that quarter but will negatively affect our revenue in future quarters. Accordingly, if we experience significant downturns in sales and market acceptance of our offerings, it may not be fully reflected in our results of operations until future periods.
Consequently, a decline in new or renewed subscriptions in any one quarter may have a minimal impact on our revenue for that quarter but will negatively affect our revenue in future quarters.
Nevertheless, we encounter attempts by third parties to penetrate or bypass our data protection and other security measures and gain unauthorized access to our networks, systems and data or compromise our customers’ confidential information or data.
We have a reputation for secure and reliable software products and services and invest time and resources into protecting the integrity and security of our products, services and internal and external data that we manage. 18 Nevertheless, we encounter attempts by third parties to penetrate or bypass our data protection and other security measures and gain unauthorized access to our networks, systems and data or compromise our customers’ confidential information or data.

… 51 more changes not shown on this page.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

230 edited+47 added−32 removed138 unchanged
Biggest changeThe undistributed earnings and profits are considered to be permanently reinvested, accordingly no provision for local withholdings taxes have been provided, however, upon repatriation of those earnings, in the form of dividends, we could be subject to additional local withholding taxes. 60 We present below a summary of the items that cause recorded income taxes to differ from taxes computed using the statutory federal income tax rate for the years ended December 31, 2024, 2023 and 2022: Year Ended December 31, 2024 2023 2022 Statutory federal income tax rate 21.0 % 21.0 % 21.0 % Effect of: State income tax, net of federal benefit 2.9 3.0 3.6 State credit carryforwards - ( 0.2 ) 1.2 U.S. federal R&D tax credit ( 1.6 ) ( 1.8 ) ( 1.8 ) Non-deductible equity compensation 1.4 1.1 1.1 Excess benefit of equity compensation ( 4.9 ) ( 3.2 ) ( 4.8 ) Employee compensation limitation 2.8 3.4 3.7 Global Intangible Low Taxed Income (GILTI) 0.1 0.1 0.1 Foreign-derived intangible income (FDII) deduction ( 3.5 ) ( 3.6 ) ( 3.3 ) Foreign operations ( 0.2 ) ( 2.9 ) 0.5 Tax contingencies ( 0.2 ) ( 0.3 ) ( 1.3 ) Other permanent differences 0.4 0.7 ( 0.3 ) Change in valuation allowance - 0.1 ( 1.3 ) Income taxes 18.2 % 17.4 % 18.4 % A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows for the years ended December 31, 2024, 2023 and 2022 (in thousands): December 31, 2024 2023 2022 Unrecognized tax benefits at January 1, $ ( 9,688 ) $ ( 10,532 ) $ ( 13,186 ) Gross amount of increases in unrecognized tax benefits as a result of tax positions taken during a prior period ( 147 ) ( 425 ) ( 199 ) Gross amount of decreases in unrecognized tax benefits as a result of tax positions taken during a prior period 32 908 2,583 Gross amount of increases in unrecognized tax benefits as a result of tax positions taken during the current period ( 1,996 ) ( 2,182 ) ( 1,787 ) Reductions to unrecognized tax benefits relating to settlements with taxing authorities 16 - - Reductions to unrecognized tax benefits as a result of a lapse of the applicable statute of limitations 2,634 2,543 2,057 Unrecognized tax benefits at December 31, $ ( 9,149 ) $ ( 9,688 ) $ ( 10,532 ) Our unrecognized tax benefits totaled $ 9.1 million and $ 9.7 million as of December 31, 2024 and 2023 , respectively.
Biggest changeStatutory federal income tax rate: $ 60,038 21.0 % $ 56,031 21.0 % $ 44,871 21.0 % State and Local Income Taxes, Net of Federal Income Tax Effect* 11,351 4.0 8,354 3.1 7,722 3.7 Other State 710 0.2 544 0.2 81 - Foreign Tax Effects India Income subject to tax holiday ( 4,244 ) ( 1.5 ) ( 3,917 ) ( 1.5 ) ( 4,185 ) ( 2.0 ) Other 2,544 0.9 2,930 1.1 1,345 0.6 Other foreign jurisdictions 476 0.2 238 0.1 360 0.2 Effect of Changes in Tax Rates or Laws Enacted in Current Period ( 165 ) ( 0.1 ) ( 52 ) - ( 3,782 ) ( 1.8 ) Effect of Cross Border-Tax Laws Foreign Derived Intangible Income ( 10,255 ) ( 3.6 ) ( 9,380 ) ( 3.5 ) ( 7,743 ) ( 3.6 ) Other 1,016 0.4 934 0.3 800 0.4 Tax Credits Research and development tax credits ( 5,729 ) ( 2.0 ) ( 4,846 ) ( 1.8 ) ( 5,332 ) ( 2.5 ) Nontaxable or Nondeductible Items Non-deductible equity compensation 3,836 1.3 3,671 1.4 2,380 1.1 Tax benefit of equity compensation ( 6,080 ) ( 2.1 ) ( 13,104 ) ( 4.9 ) ( 6,800 ) ( 3.2 ) Employee compensation limitation 9,698 3.4 7,449 2.8 7,210 3.4 Other 204 0.1 199 0.1 160 0.1 Changes in Unrecognized Tax Benefits 2,379 0.8 ( 533 ) ( 0.2 ) ( 688 ) ( 0.3 ) Other Adjustments 167 0.1 ( 68 ) - 704 0.3 Effective Tax $ 65,946 23.1 % $ 48,450 18.2 % $ 37,103 17.4 % * State taxes in the following jurisdictions made up the majority (greater than 50 percent) of the tax effect in this category: California, Pennsylvania, New Jersey, Massachusetts A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows for the years ended December 31, 2025, 2024 and 2023 (in thousands): December 31, 2025 2024 2023 Unrecognized tax benefits at January 1, $ ( 9,149 ) $ ( 9,688 ) $ ( 10,532 ) Gross amount of increases in unrecognized tax benefits as a result of tax positions taken during a prior period ( 376 ) ( 147 ) ( 425 ) Gross amount of decreases in unrecognized tax benefits as a result of tax positions taken during a prior period 1,456 32 908 Gross amount of increases in unrecognized tax benefits as a result of tax positions taken during the current period ( 6,559 ) ( 1,996 ) ( 2,182 ) Reductions to unrecognized tax benefits relating to settlements with taxing authorities - 16 - Reductions to unrecognized tax benefits as a result of a lapse of the applicable statute of limitations 2,509 2,634 2,543 Unrecognized tax benefits at December 31, $ ( 12,119 ) $ ( 9,149 ) $ ( 9,688 ) Our unrecognized tax benefits totaled $ 12.1 million and $ 9.1 million as of December 31, 2025 and 2024 , respectively.
The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the account or disclosure to which it relates.
The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter on the account or disclosure to which it relates.
Conditions to our obligations generally include that we are provided the right to control the defense of the claims and, in general, to control settlement negotiations.
Conditions to our obligations generally include that we are provided the right to control the defense of the claims and, in general, to control settlement negotiations.
The Cybersecurity Committee’s purpose is 23 to review cybersecurity risks, discuss emerging threats, prioritize cybersecurity efforts, and make recommendations to leadership. • Crisis Response Team – Pursuant to our Crisis Response Program, our Crisis Response Team, which comprises the CLO, CFO, Chief People Officer and Chief Marketing Officer, and an expanded team from our material business lines and administrative departments, as well as outside advisors/experts (cyber forensics, external legal counsel, law enforcement, public relations), is charged with managing the Company through a cybersecurity incident (or other event or series of events) that rise to the level of a Company “crisis.” The Program includes protocols by which the CLO, on behalf of the Team, will report to or engage the CEO and the Chairman of the Board if and when an incident becomes a crisis or potential crisis. • Other Roles – The Cyber Program includes engagement of other Company management employees and outside service providers to oversee or perform specific roles in connection with cybersecurity risk assessment and management, and incident management.
The Cybersecurity Committee’s purpose is to review cybersecurity risks, discuss emerging threats, prioritize cybersecurity efforts, and make recommendations to leadership. • Crisis Response Team – Pursuant to our Crisis Response Program, our Crisis Response Team, which comprises the CLO, CFO, Chief People Officer and Chief Marketing Officer, and an expanded team from our material business lines and administrative departments, as well as outside advisors/experts (cyber forensics, external legal counsel, law enforcement, public relations), is charged with managing the Company through a cybersecurity incident (or other event or series of events) that rise to the level of a Company “crisis.” The Program includes protocols by which the CLO, on behalf of the Team, will report to or engage the CEO and the Chairman of the Board if and when an incident becomes a crisis or potential crisis. • Other Roles – The Cyber Program includes engagement of other Company management employees and outside service providers to oversee or perform specific roles in connection with cybersecurity risk assessment and management, and incident management.
We provide maintenance services, to customers who have previously purchased a perpetual license, that include a comprehensive 24 hours per day, 365 days per year program that provides customers with software upgrades, when and if available, which include additional or improved functionality and technological advances incorporating emerging supply chain and industry initiatives. Maintenance contracts typically only have one performance obligation.
We provide maintenance services to customers who have previously purchased a perpetual license, including a comprehensive 24 hours per day, 365 days per year program that provides customers with software upgrades, when and if available, which include additional or improved functionality and technological advances incorporating emerging supply chain and industry initiatives. Maintenance contracts typically only have one performance obligation.
Remaining Performance Obligations Transaction price allocated to RPO represents contracted revenue that has not yet been recognized, which includes deferred revenue and non-cancelable amounts that we expect to invoice and recognize as revenue in future periods. Over 98% of our RPO represent cloud native subscriptions with a non-cancelable term greater than one year.
Remaining Performance Obligations Transaction price allocated to RPO represents contracted revenue that has not yet been recognized, which includes deferred revenue and non-cancelable amounts that we expect to invoice and recognize as revenue in future periods. Over 98% of our RPO 30 represent cloud native subscriptions with a non-cancelable term greater than one year.
Item 1C. Cybersecurity We believe Manhattan has appropriate processes for assessing, identifying, and managing material risks from cybersecurity threats. Those processes are embodied in our enterprise-wide Cyber Risk Management Program (the “Cyber Program”), which includes our cybersecurity governance structure and our cybersecurity strategy and processes. Governance Structure Board Oversight .
Item 1C. Cybersecurity We believe Manhattan has appropriate processes for assessing, identifying, and managing material risks from cybersecurity threats. Those processes are embodied in our enterprise-wide Cyber Risk Management Program (the “Cyber Program”), which includes our cybersecurity governance structure and our cybersecurity strategy and processes. 23 Governance Structure Board Oversight .
We maintain cash and cash equivalents with various financial institutions. Amounts held are above the federally insured limit. Our sales are primarily to companies located in the United States, Europe and Asia. We perform periodic credit evaluations of our customers’ financial condition and do not require collateral.
We maintain cash and cash equivalents with various financial institutions. Amounts held are above the federally insured limit. 51 Our sales are primarily to companies located in the United States, Europe and Asia. We perform periodic credit evaluations of our customers’ financial condition and do not require collateral.
The restricted stock unit awards contain vesting provisions that are 50 % service based and 50 % performance based for employee awards and 100 % service based for non-employee members of the Board of Directors (“Outside Directors”). The employee awards have a four year vesting period, with the performance portion tied to annual revenue and operating income targets.
The restricted stock unit awards contain vesting provisions that are 50 % service based and 50 % performance based for employee awards and 100 % service based for non-employee members of the Board of Directors (“Outside Directors”). The employee awards 57 have a four year vesting period, with the performance portion tied to annual revenue and operating income targets.
We also conduct reviews for compliance with data protection regulation such as Europe’s General Data Protection Regulation (GDPR) and regulation of various U.S. states such as the California Consumer Privacy Act (CCPA). Risk Management and Strategy Overview of Processes for Assessing, Identifying, and Managing Material Cyber Risks .
We also conduct reviews for compliance with data protection regulation such as Europe’s General Data Protection Regulation (GDPR) and regulation of various U.S. states such as the California Consumer Privacy Act (CCPA). 24 Risk Management and Strategy Overview of Processes for Assessing, Identifying, and Managing Material Cyber Risks .
As a convenience for our cloud and perpetual license customers, we resell a variety of hardware products developed and manufactured by third parties. These products include computer hardware, radio frequency terminal networks, RFID chip readers, bar code printers and scanners, and other peripherals.
As a convenience for our cloud and perpetual license customers, we resell a variety of hardware products developed and manufactured by third parties. These products include computer hardware, radio frequency terminal networks, RFID chip readers, 31 bar code printers and scanners, and other peripherals.
Summary of Significant Accounting Policies Cash and Cash Equivalents We consider all highly liquid investments purchased with original maturities of three months or less to be cash or cash equivalents. 51 Concentrations of Credit Risk Financial instruments that potentially subject us to significant concentrations of credit risk consist principally of cash and cash equivalents and accounts receivable.
Summary of Significant Accounting Policies Cash and Cash Equivalents We consider all highly liquid investments purchased with original maturities of three months or less to be cash or cash equivalents. Concentrations of Credit Risk Financial instruments that potentially subject us to significant concentrations of credit risk consist principally of cash and cash equivalents and accounts receivable.
Those provisions generally provide also that, if the customer is prevented from using our services or products because of a third party infringement claim, our sole obligation (in addition to the indemnification, defense, and hold harmless obligation referred to above) is to, at our expense, (i) procure for the customer the right to continue to use the services or products, (ii) replace or modify the services or products so that the customer’s use does not infringe, or, if neither of those options is reasonably feasible, terminate that particular services or products and provide, as applicable, a refund of services fees paid for services not received or a refund of the unamortized portion of the license fees paid for the products (based on a five year amortization period).
Those provisions generally provide also that, if the customer is prevented from using our services or products because of a third party infringement claim, our sole obligation (in addition to the indemnification, defense, and hold harmless obligation referred to above) is to, at our expense, (i) procure for the customer the right to continue to use the services or products, (ii) replace or modify the services or products so that the customer’s use does not infringe, or, if neither of these options is reasonably feasible, (iii) terminate that particular services or products and provide, as applicable, a refund of services fees paid for services not received or a refund of the unamortized portion of the license fees paid for the products (based on a five year amortization period).
Under those provisions, we generally agree, subject to certain exceptions, to indemnify, defend, and hold harmless the customer in connection with third party claims against the customer alleging that the customer’s use of our software services and products infringe third party intellectual property rights.
Under those provisions, we generally agree, subject to certain exceptions, to indemnify, defend, and hold harmless the customer in connection with third party claims against the customer alleging that the customer’s use of our services and products infringe third party intellectual property rights.
Actual results will differ from these estimates. 52 Revenue Recognition We recognize revenue when we transfer control of the promised products or services to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those products or services.
Actual results will differ from these estimates. Revenue Recognition We recognize revenue when we transfer control of the promised products or services to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those products or services.
Although we attempt to contractually limit our liability for damages arising from product failures or negligent acts or omissions, there can be no assurance that the limitations of liability set forth in its contracts will be enforceable in all instances.
Although we attempt to limit contractually our liability for damages arising from product failures or negligent acts or omissions, there can be no assurance that the limitations of liability set forth in our contracts will be enforceable in all instances.
To the extent we conclude that it is more likely than not that a reporting unit’s estimated fair value is less than its carrying amount, the two-step approach is applied. The first step would require a comparison of each reporting unit’s fair value to the 55 respective carrying amount.
To the extent we conclude that it is more likely than not that a reporting unit’s estimated fair value is less than its carrying amount, the two-step approach is applied. The first step would require a comparison of each reporting unit’s fair value to the respective carrying amount.
Changes in tax law or our interpretation of tax laws and the resolution of current and future tax audits could significantly impact the amounts provided for income taxes in our statement of financial position and our statements of income.
Changes in tax law or our interpretation of tax laws and the resolution of current and future tax audits could significantly impact the amounts provided for 56 income taxes in our statement of financial position and our statements of income.
AND SUBSIDIARIES NOTE S TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 2024, 2023 and 2022 1. Organization, Consolidation and Summary of Significant Accounting Policies Organization and Business Manhattan Associates, Inc. (“Manhattan”, the “Company”, “we”, “our”, or “us”) is a developer and provider of supply chain commerce solutions that help organizations optimize the effectiveness, efficiency, and strategic advantages of their supply chains.
AND SUBSIDIARIES NOTE S TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 2025, 2024 and 2023 1. Organization, Consolidation and Summary of Significant Accounting Policies Organization and Business Manhattan Associates, Inc. (“Manhattan”, the “Company”, “we”, “our”, or “us”) is a developer and provider of supply chain commerce solutions that help organizations optimize the effectiveness, efficiency, and strategic advantages of their supply chains.
While demand for our solutions is solid, the current business climate within the United States and geographic regions in which we operate may affect customers’ and prospects’ decisions regarding timing of strategic capital expenditures. In January 2025, the International Monetary Fund (IMF) provided a World Economic Outlook (WEO) update.
While demand for our solutions is solid, the current business climate within the United States and geographic regions in which we operate may affect customers’ and prospects’ decisions regarding timing of strategic capital expenditures. In January 2026, the International Monetary Fund (IMF) provided a World Economic Outlook (WEO) update.
We resell all third-party hardware products and related maintenance pursuant to agreements with manufacturers or through distributor-authorized reseller agreements pursuant to which we are entitled to purchase 29 hardware products and services at discount prices. We generally purchase hardware from our vendors only after receiving an order from a customer. As a result, we do not maintain hardware inventory.
We resell all third-party hardware products and related maintenance pursuant to agreements with manufacturers or through distributor-authorized reseller agreements pursuant to which we are entitled to purchase hardware products and services at discount prices. We purchase hardware from our vendors only after receiving an order from a customer. As a result, we do not maintain hardware inventory.
Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Manhattan Associates, Inc. and subsidiaries (the Company) as of December 31, 2024 and 2023, the related consolidated statements of income, comprehensive income, cash flows and shareholders’ equity for each of the three years in the period ended December 31, 2024, and the related notes (collectively referred to as the “consolidated financial statements”).
Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Manhattan Associates, Inc. and subsidiaries (the Company) as of December 31, 2025 and 2024, the related consolidated statements of income, comprehensive income, cash flows and shareholders’ equity for each of the three years in the period ended December 31, 2025, and the related notes (collectively referred to as the “consolidated financial statements”).
If the carrying amount exceeds the fair value, a second step is performed to measure the amount of impairment loss, if any. We did not identify any macroeconomic or industry conditions as of December 31, 2024, that would indicate that the fair value of the reporting units were more likely than not to be less than their respective carrying values.
If the carrying amount exceeds the fair value, a second step is performed to measure the amount of impairment loss, if any. We did not identify any macroeconomic or industry conditions as of December 31, 2025, that would indicate that the fair value of the reporting units were more likely than not to be less than their respective carrying values.
Under those provisions, we generally agree, subject to certain exceptions, to indemnify, defend, and hold harmless the customer in connection with third party claims against the customer alleging that the customer’s use of our software products in compliance with their license infringe the third party’s patent, copyright, or other intellectual property rights.
Under those provisions, we generally agree, subject to certain exceptions, to indemnify, defend, and hold harmless the customer in connection with third party claims against the customer alleging that the customer’s use of our services and products in compliance with their license infringe the third party’s patent, copyright, or other intellectual property rights.
You may find additional information regarding our equity compensation plans in Note 2 of the Notes to our Consolidated Financial Statements. Purchase of Equity Securities In the following table, we provide information regarding our common stock repurchases under our publicly-announced share repurchase program for the quarter ended December 31, 2024.
You may find additional information regarding our equity compensation plans in Note 2 of the Notes to our Consolidated Financial Statements. Purchase of Equity Securities In the following table, we provide information regarding our common stock repurchases under our publicly-announced share repurchase program for the quarter ended December 31, 2025.
(“Gartner”), an information technology research and advisory company, estimates that over 75% of every supply chain software solutions dollar invested is spent in North America and Europe; consequently, the health of the U.S. and European economies have a meaningful impact on our financial results.
(“Gartner”), an information technology research and advisory company, estimates that over 80% of every supply chain software solutions dollar invested is spent in North America and Europe; consequently, the health of the U.S. and European economies have a meaningful impact on our financial results.
In 2025, we anticipate that our priorities for use of cash will be similar to prior years, with our first priority being continued investment in product development and in our business to extend our market leadership. We will also continue to weigh our share repurchase options against cash for acquisitions and investing in the business.
In 2026, we anticipate that our priorities for use of cash will be similar to prior years, with our first priority being continued investment in product development and in our business to extend our market leadership. We will also continue to weigh our share repurchase options against cash for acquisitions and investing in the business.
In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2024, in conformity with U.S. generally accepted accounting principles.
In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025, in conformity with U.S. generally accepted accounting principles.
Our credit loss reserve was $ 0.9 million and $ 0.9 million as of December 31, 2024 and 2023, respectively. We also reduce accounts receivable with a corresponding reduction in services revenue for the most likely amount of potential service revenue adjustments based on a detailed assessment of accounts receivable.
Our credit loss reserve was $ 0.9 million and $ 0.9 million as of December 31, 2025 and 2024, respectively. We also reduce accounts receivable with a corresponding reduction in services revenue for the most likely amount of potential service revenue adjustments based on a detailed assessment of accounts receivable.
We performed our periodic review of goodwill for impairment as of December 31, 2024 and 2023 , and did not identify any impairment as a result of the review. Guarantees and Indemnities We account for guarantees in accordance with the guarantee accounting topic in the FASB Codification . Our customer contracts generally contain infringement indemnity provisions.
We performed our periodic goodwill impairment review as of December 31, 2025 and 2024 , and did not identify any impairment as a result of the review. Guarantees and Indemnities We account for guarantees in accordance with the guarantee accounting topic in the FASB Codification . Our customer contracts generally contain infringement indemnity provisions.
We account for these indemnity obligations in accordance with the Financial Accounting Standards Board's guidance on accounting for contingencies and record a liability for these obligations when a loss is probable and reasonably estimable. We have not recorded any liabilities for these indemnification obligations as of December 31, 2024.
We account for these indemnity obligations in accordance with the Financial Accounting Standards Board's guidance on accounting for contingencies and record a liability for these obligations when a loss is probable and reasonably estimable. We have not recorded any liabilities for these indemnification obligations as of December 31, 2025, or 2024.
Maintenance contracts for perpetual software licenses are typically one year in duration and are not included in the remaining performance obligations. We expect to recognize revenue on approximately 40 % of these remaining performance obligations over the next 24 months with the majority of the remaining balance recognized over the following 36 months.
Maintenance contracts for perpetual software licenses are typically one year in duration and are not included in the remaining performance obligations. We expect to recognize revenue on approximately 38 % of these remaining performance obligations over the next 24 months with the majority of the remaining balance recognized over the following 36 months.
Change in Internal Control over Financial Reporting During the fourth quarter of 2024, there were no changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting, including any corrective actions with regard to material weaknesses. It em 9B.
Change in Internal Control over Financial Reporting During the fourth quarter of 2025, there were no changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting, including any corrective actions with regard to material weaknesses. It em 9B.
We expect to continue to evaluate acquisition opportunities that are complementary to our product footprint and technology direction. Aggregate Contractual Obligations Our principal commitments as of December 31, 2024 consist of multiple non-cancellable contracts for cloud infrastructure services and obligations under operating leases.
We expect to continue to evaluate acquisition opportunities that are complementary to our product footprint and technology direction. Aggregate Contractual Obligations Our principal commitments as of December 31, 2025 consist of multiple non-cancellable contracts for cloud infrastructure services and obligations under operating leases.
We conduct business globally and, as a result, file income tax returns in the United State federal jurisdiction and in many state and foreign jurisdictions. We are generally no longer subject to U.S. federal, state, and local, or non-US income tax examinations for the years before 2010 .
We conduct business globally and, as a result, file income tax returns in the United State federal jurisdiction and in many state and foreign jurisdictions. We are generally no longer subject to U.S. federal, state, and local, or non-US income tax examinations for the years before 2015.
If circumstances change or events occur to indicate that it is more likely than not that the fair value of any reporting units have fallen below their carrying amount, we would record an impairment charge based on that difference.
If circumstances change or events occur to indicate that it is more likely than not that the fair value of any reporting units have fallen below their carrying amount, we would record an impairment expense based on that difference.
Other Information Rule 10b5-1 Trading Plans During the quarter ended December 31, 2024, no director or officer of the Company adopted or terminated a "Rule 10b5-1 trading agreement" or "non-Rule 10b5-1 trading arrangement," as each term is defined in item 408(a) of Regulation S-K.
Other Information Rule 10b5-1 Trading Plans During the quarter ended December 31, 2025, no director or officer of the Company adopted or terminated a "Rule 10b5-1 trading agreement" or "non-Rule 10b5-1 trading arrangement," as each term is defined in item 408(a) of Regulation S-K.
Opinion on Internal Control Over Financial Reporting We have audited Manhattan Associates, Inc. and subsidiaries’ internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria).
Opinion on Internal Control Over Financial Reporting We have audited Manhattan Associates, Inc. and subsidiaries’ internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria).
Accordingly, we have no liabilities recorded for these agreements as of December 31, 2024 and 2023 . Segment Information We have three reportable segments as defined by the FASB Codification topic for segment reporting: Americas, EMEA, and APAC. See Note 8 for discussion of our reportable segments.
Accordingly, we have no liabilities recorded for these agreements as of December 31, 2025 and 2024 . Segment Information We have three reportable segments as defined by the FASB Codification topic for segment reporting: Americas, EMEA, and APAC. See Note 8 for discussion of our reportable segments.
There are certain corporate expenses included in the Americas segment that we do not charge to the other segments including research and development, certain marketing and general and administrative costs that support the global organization, and the amortization of acquired developed technology.
There are certain corporate expenses included in the Americas segment that we do not charge to the other segments including research and development, stock compensation, certain marketing and general and administrative costs that support the global organization, and the amortization of acquired developed technology.
We depreciate the cost of furniture, computers, and other office equipment on a straight-line basis over their estimated useful lives ( five years for office equipment, seven years for furniture and fixtures). Leasehold improvements are depreciated over the lesser of their useful lives or the term of the lease.
We depreciate the cost of furniture, computers, and other office equipment on a straight-line basis over their estimated useful lives ( three to five years for office equipment, seven years for furniture and fixtures). Leasehold improvements are depreciated over the lesser of their useful lives or the term of the lease.
We applied the simplified goodwill impairment test for 2024, that permits companies to perform a qualitative assessment based on economic, industry and company-specific factors as the initial step in the annual goodwill impairment test for all or selected reporting units.
We applied the simplified goodwill impairment test for 2025, that permits companies to perform a qualitative assessment based on economic, industry and company-specific factors as the initial step in the annual goodwill impairment test for all or selected reporting units.
As of the end of the Company’s 2024 fiscal year, management conducted an assessment of the Company’s internal control over financial reporting based on the framework established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 Framework) (COSO).
As of the end of the Company’s 2025 fiscal year, management conducted an assessment of the Company’s internal control over financial reporting based on the framework established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 Framework) (COSO).
At this time, we do not anticipate any borrowing requirements in 2025 for general corporate purposes. 37 Periodically, opportunities may arise to grow our business through the acquisition of complementary products and technologies. Any material acquisition could result in a decrease to our working capital depending on the amount, timing, and nature of the consideration to be paid.
At this time, we do not anticipate any borrowing requirements in 2026 for general corporate purposes. Periodically, opportunities may arise to grow our business through the acquisition of complementary products and technologies. Any material acquisition could result in a decrease to our working capital depending on the amount, timing, and nature of the consideration to be paid.
As of December 31, 2024, the associated equity-based compensation expense has been recognized for the portion of the award attributable to the 2024 performance criteria. 3. Income Taxes We are subject to future federal, state, and foreign income taxes and have recorded net deferred tax assets on the Consolidated Balance Sheets at December 31, 2024 and 2023 .
As of December 31, 2025, the associated equity-based compensation expense has been recognized for the portion of the award attributable to the 2025 performance criteria. 58 3. Income Taxes We are subject to future federal, state, and foreign income taxes and have recorded net deferred tax assets on the Consolidated Balance Sheets at December 31, 2025 and 2024 .
In our opinion, Manhattan Associates, Inc. and subsidiaries (the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, 2024, based on the COSO criteria.
In our opinion, Manhattan Associates, Inc. and subsidiaries (the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on the COSO criteria.
Based on the average cash equivalents and short-term investments outstanding during 2024 and 2023, increases or decreases in the rates of return of 25 basis points would result in increases or decreases to interest income of approximately $0.7 million and $0.6 million from the reported interest income for 2024 and 2023, respectively. 40 It em 8.
Based on the average cash equivalents and short-term investments outstanding during 2025 and 2024, increases or decreases in the rates of return of 25 basis points would result in increases or decreases to interest income of approximately $0.7 million and $0.7 million from the reported interest income for 2025 and 2024, respectively. 40 It em 8.
We also anticipate prioritizing capital allocation in our global teams to fund growth, and accretive share repurchases. We do not anticipate any borrowing requirements in 2025 for general corporate purposes.
We also anticipate prioritizing capital allocation in our global teams to fund growth, and accretive share repurchases. We do not anticipate any borrowing requirements in 2026 for general corporate purposes.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated February 7, 2025 expressed an unqualified opinion thereon.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated February 4, 2026 expressed an unqualified opinion thereon.
We do no t have any accumulated impairment loses as of 2024. Goodwill was $ 62.2 million at the end of both years ended December 31, 2024 and 2023.
We do no t have any accumulated impairment loses as of 2025. Goodwill was $ 62.2 million at the end of both years ended December 31, 2025 and 2024.
Management’s Report on Internal Control over Financial Reporting Management’s assessment of the effectiveness of our internal control over financial reporting as of December 31, 2024, and the report of Ernst & Young LLP on the effectiveness of our internal control over financial reporting are contained on pages 42 and 43 of this report.
Management’s Report on Internal Control over Financial Reporting Management’s assessment of the effectiveness of our internal control over financial reporting as of December 31, 2025, and the report of Ernst & Young LLP on the effectiveness of our internal control over financial reporting are contained on pages 42 and 43 of this report.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2024 and 2023, the related consolidated statements of income, comprehensive income, cash flows and shareholders’ equity for each of the three years in the period ended December 31, 2024, and the related notes and our report dated February 7, 2025 expressed an unqualified opinion thereon.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2025 and 2024, the related consolidated statements of income, comprehensive income, cash flows and shareholders’ equity for each of the three years in the period ended December 31, 2025, and the related notes and our report dated February 4, 2026 expressed an unqualified opinion thereon.
Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. /s/ Ernst & Young LLP Atlanta, Georgia February 7, 2025 43 REPORT OF INDEPENDENT REGIST ERED PUBLIC ACCOUNTING FIRM To the Shareholders and the Board of Directors of Manhattan Associates, Inc.
Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. /s/ Ernst & Young LLP Atlanta, Georgia February 4, 2026 43 REPORT OF INDEPENDENT REGIST ERED PUBLIC ACCOUNTING FIRM To the Shareholders and the Board of Directors of Manhattan Associates, Inc.
We recognize revenue for distinct software licenses once the license period has begun and we have made the software available to the customer. The selling price of our software licenses are highly variable.
We recognize revenue for distinct software licenses once the license period has begun and we have made the software available to the customer. The selling prices of our software licenses are highly variable.
Nature of Products and Services Cloud subscriptions includes software as a service (“SaaS”) and arrangements which provide customers with the right to use our software within a cloud environment that we provide and manage where the customer does not have the right to take possession of the software without significant penalty.
Nature of Products and Services Cloud subscriptions include software as a service (“SaaS”) and hosting arrangements which provide customers with the right to use our software within a cloud environment that we provide and manage where the customer does not have the right to take possession of the software without significant penalty.
Properties Our principal administrative, sales, marketing, support, and research and development facility is located in approximately 221,000 square feet of modern office space in Atlanta, Georgia.
Properties Our principal administrative, sales, marketing, support, and research and development facility is located in approximately 209,000 square feet of modern office space in Atlanta, Georgia.
In January 2025, our Board of Directors raised the Company’s share repurchase authority to an aggregate of $100.0 million of our common stock. We believe that our existing cash will be sufficient to meet our working capital and capital expenditure needs at least for the next twelve months, although there can be no assurance that this will be the case.
In January 2026, our Board of Directors replenished the Company’s share repurchase authority to an aggregate of $100.0 million of our common stock. We believe that our existing cash will be sufficient to meet our working capital and capital expenditure needs at least for the next twelve months, although there can be no assurance that this will be the case.
At December 31, 2024, we employed approximately 4,690 employees worldwide. We have offices in Australia, Chile, China, France, Germany, India, Italy, Japan, the Netherlands, Singapore, Spain, and the United Kingdom, as well as representatives in Mexico and reseller partnerships in Latin America, Eastern Europe, the Middle East, South Africa, and Asia.
At December 31, 2025, we employed approximately 4,370 employees worldwide. We have offices in Australia, Chile, China, France, Germany, India, Italy, Japan, the Netherlands, Singapore, Spain, and the United Kingdom, as well as representatives in Mexico and reseller partnerships in Latin America, Eastern Europe, the Middle East, South Africa, and Asia.
Based on this assessment, management has determined that the Company’s internal control over financial reporting as of December 31, 2024 was effective.
Based on this assessment, management has determined that the Company’s internal control over financial reporting as of December 31, 2025 was effective.
If such events and circumstances exist, undiscounted cash flows associated with these assets are compared with their carrying value to determine if a write-down to fair value is required. During 2024, 2023 and 2022 , we did no t recognize any impairment charges associated with our long-lived or intangible assets.
If such events and circumstances exist, undiscounted cash flows associated with these assets are compared with their carrying value to determine if a write-down to fair value is required. During 2025, 2024, and 2023 , we did no t recognize any impairment expense associated with our long-lived or intangible assets.
We recognized foreign exchange losses of $ 1.0 million in 2024 , compared to losses of $ 1.5 million in 2023 , and gains of $ 4.7 million in 2022. Foreign exchange rate transaction gains and losses are classified in “Other (loss) income, net” on the Consolidated Statements of Income.
We recognized foreign exchange gains of $ 1.7 million in 2025 , compared to losses of $ 1.0 million in 2024 , and gains of $ 1.5 million in 2023. Foreign exchange rate transaction gains and losses are classified in “Other (loss) income, net” on the Consolidated Statements of Income.
No single customer accounted for more than 10% of revenue in 2024, 2023 and 2022, or more than 10% of accounts receivable as of December 31, 2024 and 2023 .
No single customer accounted for more than 10% of revenue in 2025, 2024, and 2023, or more than 10% of accounts receivable as of December 31, 2025 and 2024 .
We estimate SSP based on the prices we charge our customers or by using other information such as market conditions and other observable inputs. The selling price of our cloud subscriptions are highly variable.
We estimate SSP based on the prices charged to customers, or by using information such as market conditions and other observable inputs. The selling price of our cloud subscriptions are highly variable.
During the past three years, our primary uses of cash have been for funding investments in R&D in our Unified Omnichannel Commerce and Digital Supply Chain solutions to drive revenue and earnings growth. In addition, we repurchased $241.6 million of Manhattan Associates’ outstanding common stock under the share repurchase program approved by our Board of Directors.
During the past three years, our primary uses of cash have been for funding investments in R&D in our Unified Omnichannel Commerce and Digital Supply Chain solutions to drive revenue and earnings growth. In addition for 2025, we repurchased $274.5 million of Manhattan Associates’ outstanding common stock under the share repurchase program approved by our Board of Directors.
Cloud Subscription Under our Manhattan Active® Solutions cloud subscription offering, customers pay a periodic fee for the right to use our software within a cloud environment that we provide and manage over a specified period of time. Adoption of our Manhattan Active® cloud solutions continues to increase nicely, with cloud revenue up 32% over 2023.
Cloud Subscription Under our Manhattan Active® Solutions cloud subscription offering, customers pay a periodic fee for the right to use our software within a cloud environment that we provide and manage over a specified period of time. Adoption of our Manhattan Active® cloud solutions continues to increase nicely, with cloud revenue up 21% over 2024.
In January 2025, our Board of Directors raised the Company’s share repurchase authority to an aggregate of $100.0 million of our common stock. In 2025, we expect that our priorities for use of cash will continue to be investments in our Unified Omnichannel Commerce and Digital Supply Chain solutions.
In January 2026, our Board of Directors replenished the Company’s share repurchase authority to an aggregate of $100.0 million of our common stock. In 2026, we expect that our priorities for use of cash will continue to be investments in our Unified Omnichannel Commerce and Digital Supply Chain solutions.
Goodwill and Impairment of Goodwill Goodwill Goodwill represents the excess of the consideration transferred over the fair value of net identified tangible and intangible assets and liabilities acquired. We evaluate goodwill for impairment on at least an annual basis. During 2024 and 2023 , we did no t recognize any impairment charges associated with our goodwill.
Goodwill and Impairment of Goodwill Goodwill Goodwill represents the excess of the consideration transferred over the fair value of net identified tangible and intangible assets and liabilities acquired. We evaluate goodwill for impairment on at least an annual basis. During 2025 and 2024 , we did no t recognize any impairment expense associated with our goodwill.
The total amount recorded to services revenue was $ 1.6 million, $ 4.9 million, and $ 5.4 million for the years ended December 31, 2024, 2023, and 2022, respectively. As of December 31, 2024 and 2023 , we have reduced our accounts receivable balance by $ 2.8 million and $ 4.4 million, respectively, for these potential adjustments.
The total amount recorded to services revenue was $ 0.6 million, $ 1.6 million, and $ 4.9 million for the years ended December 31, 2025, 2024, and 2023, respectively. As of December 31, 2025 and 2024 , we have reduced our accounts receivable balance by $ 1.9 million and $ 2.8 million, respectively, for these potential adjustments.
How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over the Company's process to identify the performance obligations in a customer contract. 44 Our audit procedures included, among others, reading a sample of executed contracts to assess management’s evaluation of significant terms, including the identification of distinct performance obligations, and tested the transaction price allocated to the performance obligations. /s/ Ernst & Young LLP We have served as the Company’s auditor since 2002.
How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over the Company's identification of the performance obligations in a customer contract. 44 Our audit procedures included, among others, reading a sample of executed contracts to assess management’s evaluation of significant terms including the identification of the performance obligations. /s/ Ernst & Young LLP We have served as the Company’s auditor since 2002.
We expect to fulfill all of these commitments from our working capital. Lease Commitments We lease our facilities and some of our equipment under noncancelable operating lease arrangements that expire at various dates ranging from 2025 to 2036. Rent expense for these leases aggregated $9.3 million, $8.1 million, and $7.7 million during 2024, 2023 and 2022, respectively.
We expect to fulfill all of these commitments from our working capital. Lease Commitments We lease our facilities and some of our equipment under noncancelable operating lease arrangements that expire at various dates ranging from 2025 to 2036. Rent expense for these leases aggregated $10.1 million and $9.3 million during 2025 and 2024, respectively.
When the U.S. dollar weakens, the value of our sales and expenses in that currency converted to U.S. dollars increases. We recognized foreign exchange losses of $1.0 million in 2024, compared to losses of $1.5 million in 2023, and gains of $4.7 million in 2022.
When the U.S. dollar weakens, the value of our sales and expenses in that currency converted to U.S. dollars increases. We recognized foreign exchange losses of $1.7 million in 2025, compared to losses of $1.0 million in 2024, and losses of $1.5 million in 2023.
Future Expectations While we remain cautious about the global economy, our results for the full year ended 2024 exceeded our expectations due to solid demand for our cloud solutions. Our solutions are mission critical, supporting complex global supply chains.
Future Expectations While we remain cautious about the global economy, our results for the full year ended December 31, 2025 exceeded our expectations due to solid demand for our cloud solutions. Our solutions are mission critical, supporting complex global supply chains.
Cloud subscriptions revenue recognized from first time cloud customers (defined as customers with no prior cloud subscriptions) during the year in which their initial cloud subscription began was approximately 2% and 3% of total cloud revenue in 2024 and 2023, respectively.
Cloud subscriptions revenue recognized from first time cloud customers (defined as customers with no prior cloud subscriptions) during the year in which their initial cloud subscription began was approximately 8% and 2% of total cloud revenue in 2025 and 2024, respectively.
Included in the Americas costs are all research and development costs, including the costs associated with our operations in India. During 2024, 2023, or 2022, we derived the majority of our revenues from sales to customers within our Americas segment.
Included in the Americas costs are all research and development costs, including the costs associated with our operations in India. During 2025 and 2024, we derived the majority of our revenues from sales to customers within our Americas segment.
Nature of Products and Services Cloud subscriptions includes software as a service (SaaS) and arrangements which provide customers with the right to use our software within a cloud environment that we provide and manage where the customer does not have the right to take possession of the software without significant penalty.
Nature of Products and Services Cloud subscriptions include software as a service (“SaaS”) and hosting arrangements which provide customers with the right to use our software within a cloud environment that we provide and manage where the customer does not have the right to take possession of the software without significant penalty.
Due to the expiration of statutes of limitations in multiple jurisdictions globally during 2025, the Company anticipates it is reasonably possible that unrecognized tax benefits may decrease by $ 3.1 million. 4.
Due to the expiration of statutes of limitations in multiple jurisdictions globally during 2027, the Company anticipates it is reasonably possible that unrecognized tax benefits may decrease by $ 1.6 million. 4.
The royalties, which totaled $ 18.9 million, $ 13.7 million, and $ 8.9 million in 2024, 2023 and 2022, respectively, are included in costs of revenue for each segment with a corresponding reduction in the America’s cost of revenue. The revenues represented below are from external customers only.
The royalties, which totaled $ 26.0 million, $ 18.9 million, and $ 13.7 million in 2025, 2024, and 2023, respectively, are included in costs of revenue for each segment with a corresponding reduction in the America’s cost of revenue. The revenues represented below are from external customers only.
Thus, we estimate SSP for cloud subscriptions using the residual approach, determined based on total transaction price less the SSP of other goods and services promised in the contract. It em 7A.
Thus, we estimate SSP for our cloud subscriptions using the residual approach, determined based on total transaction price less the SSP of other goods and services promised in the contract.
We recognize forfeitures of equity-based payments as they occur. During the year ended December 31, 2024 , the Company granted 386,042 RSUs that have performance-based vesting criteria, which are tied to our financial performance. The performance-based RSUs granted in 2024 related to 2024 employee awards and 2023 above-target employee awards.
We recognize forfeitures of equity-based payments as they occur. During the year ended December 31, 2025 , the Company granted 364,411 RSUs that have performance-based vesting criteria, which are tied to our financial performance. The performance-based RSUs granted in 2025 related to 2025 employee awards and 2024 above-target employee awards.
Our remaining revenue was derived from domestic sales. 64 Cloud subscriptions revenue primarily relates to our Manhattan Active omnichannel, warehouse management solutions, and transportation management solutions for the year ended December 31, 2024 . The majority of our software license revenue (approximately 85 %) relates to our warehouse management product group for the same period. 9.
Our remaining revenue was derived from domestic sales. 65 Cloud subscriptions revenue primarily relates to our Manhattan Active omnichannel, warehouse management solutions, and transportation management solutions for the year ended December 31, 2025 . The majority of our software license revenue (approximately 80 %) relates to our warehouse management product group for the same period. 9.

… 229 more changes not shown on this page.

Other MANH 10-K year-over-year comparisons