10-Q 1 bsy-20240331.htm 10-Q bsy-20240331
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
___________________________________

FORM 10-Q
___________________________________

(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2024
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from              to

Commission File Number: 001-39548
___________________________________

BENTLEY SYSTEMS, INCORPORATED
(Exact name of registrant as specified in its charter)
___________________________________
Delaware
95-3936623
(State or other jurisdiction of incorporation or organization)
(I.R.S. Employer Identification No.)
685 Stockton Drive
Exton, Pennsylvania
19341
(Address of principal executive offices)
(Zip Code)
Registrant’s telephone number, including area code: (610) 458-5000
___________________________________

Securities registered pursuant to Section 12(b) of the Act:

Title of each classTrading SymbolName of each exchange on which registered
Class B Common Stock, $0.01 Par ValueBSY
The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒  No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S‑T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒  No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non‑accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b‑2 of the Exchange Act.
Large accelerated filer
Accelerated filer ☐
Non-accelerated filer ☐
Smaller reporting company
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b‑2 of the Exchange Act). Yes ☐  No 

As of April 30, 2024, the registrant had 11,537,627 shares of Class A and 288,462,583 shares of Class B common stock outstanding.



BENTLEY SYSTEMS, INCORPORATED
FORM 10-Q
TABLE OF CONTENTS


2


EXPLANATORY NOTE
This Quarterly Report on Form 10‑Q is for the three months ended March 31, 2024. This Quarterly Report on Form 10‑Q modifies and supersedes documents filed before it. The United States (“U.S.”) Securities and Exchange Commission (“SEC”) allows us to “incorporate by reference” information that we file with it, which means that we can disclose important information to you by referring you directly to those documents. Information incorporated by reference is considered to be part of this Quarterly Report on Form 10‑Q. In addition, information that we file with the SEC in the future will automatically update and supersede information contained in this Quarterly Report on Form 10‑Q.
Unless indicated otherwise, throughout this Quarterly Report on Form 10‑Q, we refer to Bentley Systems, Incorporated and its consolidated subsidiaries, as “Bentley Systems,” “Bentley,” the “Company,” “we,” “us,” and “our.”
This Quarterly Report on Form 10‑Q contains trademarks, service marks, brands, or product names owned by us, as well as those owned by others.
Numerical information in this report is presented on a rounded basis using actual amounts. Minor differences in totals and percentage calculations may exist due to rounding.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10‑Q includes forward‑looking statements. All statements contained in this Quarterly Report on Form 10‑Q other than statements of historical facts, including statements regarding our future results of operations and financial position, our business strategy, and plans and our objectives for future operations, are forward‑looking statements. The words “believe,” “may,” “will,” “could,” “would,” “seeks,” “estimate,” “continue,” “anticipate,” “intend,” “expect,” and similar expressions, as well as statements regarding our focus for the future, are intended to identify forward‑looking statements. We have based these forward‑looking statements largely on our current expectations, projections, and assumptions about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy, short‑term and long‑term business operations and objectives, and financial needs. These forward‑looking statements are subject to a number of risks, uncertainties, and assumptions, including those described in the section titled “Risk Factors.” Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward‑looking statements we may make. In light of these risks, uncertainties, and assumptions, the future events and trends discussed in this Quarterly Report on Form 10‑Q may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward‑looking statements. The forward‑looking statements, as well as our Quarterly Report on Form 10‑Q as a whole, are subject to risks and uncertainties.
These statements are only current predictions and are subject to known and unknown risks, uncertainties, and other factors that may cause our or our industry’s actual results, levels of activity, performance, or achievements to be materially different from those anticipated by the forward‑looking statements. We discuss many of these risks in this Quarterly Report on Form 10‑Q in greater detail in the section titled “Risk Factors” and elsewhere in this Quarterly Report on Form 10‑Q. You should not rely upon forward‑looking statements as predictions of future events.
Although we believe that the expectations reflected in the forward‑looking statements are reasonable, we cannot guarantee future results, levels of activity, performance, achievements, events, or circumstances reflected in the forward‑looking statements will occur. Except as required by law, we undertake no obligation to update any of these forward‑looking statements after the date of this Quarterly Report on Form 10‑Q to conform these statements to actual results or revised expectations.
3



PART I. FINANCIAL INFORMATION
Item 1. Unaudited Consolidated Financial Statements
BENTLEY SYSTEMS, INCORPORATED
Consolidated Balance Sheets
(in thousands, except share and per share data)
(unaudited)

March 31, 2024December 31, 2023
Assets
Current assets:
Cash and cash equivalents$141,601 $68,412 
Accounts receivable284,200 302,501 
Allowance for doubtful accounts(9,723)(8,965)
Prepaid income taxes10,891 12,812 
Prepaid and other current assets46,716 44,797 
Total current assets473,685 419,557 
Property and equipment, net38,563 40,100 
Operating lease right-of-use assets36,454 38,476 
Intangible assets, net236,402 248,787 
Goodwill2,261,190 2,269,336 
Investments23,641 23,480 
Deferred income taxes208,152 212,831 
Other assets75,681 67,283 
Total assets$3,353,768 $3,319,850 
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable$23,568 $18,094 
Accruals and other current liabilities539,775 457,348 
Deferred revenues242,037 253,785 
Operating lease liabilities11,178 11,645 
Income taxes payable11,275 9,491 
Current portion of long-term debt10,000 10,000 
Total current liabilities837,833 760,363 
Long-term debt1,425,445 1,518,403 
Deferred compensation plan liabilities93,402 88,181 
Long-term operating lease liabilities28,812 30,626 
Deferred revenues15,206 15,862 
Deferred income taxes10,391 9,718 
Income taxes payable7,337 7,337 
Other liabilities2,735 5,378 
Total liabilities2,421,161 2,435,868 
Commitments and contingencies (Note 18)
Stockholders’ equity:
Preferred stock, $0.01 par value, authorized 100,000,000 shares; none issued or outstanding as of March 31, 2024 and December 31, 2023
  
Class A common stock, $0.01 par value, authorized 100,000,000 shares; issued and outstanding 11,537,627 and 11,537,627 shares as of March 31, 2024 and December 31, 2023, respectively
115 115 
Class B common stock, $0.01 par value, authorized 1,800,000,000 shares; issued and outstanding 286,477,055 and 284,728,210 shares as of March 31, 2024 and December 31, 2023, respectively
2,865 2,848 
Additional paid-in capital1,154,137 1,127,234 
Accumulated other comprehensive loss
(92,619)(84,987)
Accumulated deficit(132,595)(161,932)
Non-controlling interest704 704 
Total stockholders’ equity932,607 883,982 
Total liabilities and stockholders’ equity
$3,353,768 $3,319,850 

See accompanying notes to consolidated financial statements.
4



BENTLEY SYSTEMS, INCORPORATED
Consolidated Statements of Operations
(in thousands, except share and per share data)
(unaudited)

Three Months Ended
March 31,
20242023
Revenues:
Subscriptions$307,089 $277,845 
Perpetual licenses9,512 9,547 
Subscriptions and licenses316,601 287,392 
Services21,162 27,019 
Total revenues337,763 314,411 
Cost of revenues:
Cost of subscriptions and licenses40,218 40,931 
Cost of services21,612 26,253 
Total cost of revenues61,830 67,184 
Gross profit275,933 247,227 
Operating expenses:
Research and development68,371 67,800 
Selling and marketing54,386 52,141 
General and administrative46,482 46,807 
Deferred compensation plan5,799 4,146 
Amortization of purchased intangibles8,964 10,548 
Total operating expenses184,002 181,442 
Income from operations
91,931 65,785 
Interest expense, net(6,520)(11,092)
Other income, net
7,137 289 
Income before income taxes
92,548 54,982 
Provision for income taxes
(22,247)(9,492)
Equity in net income of investees, net of tax
9  
Net income
$70,310 $45,490 
Per share information:
Net income per share, basic
$0.22 $0.15 
Net income per share, diluted
$0.22 $0.14 
Weighted average shares, basic314,295,102 310,758,802 
Weighted average shares, diluted333,623,518 331,251,884 

See accompanying notes to consolidated financial statements.
5



BENTLEY SYSTEMS, INCORPORATED
Consolidated Statements of Comprehensive Income
(in thousands)
(unaudited)

Three Months Ended
March 31,
20242023
Net income
$70,310 $45,490 
Other comprehensive (loss) income, net of taxes:
Foreign currency translation adjustments(7,733)340 
Actuarial gain on retirement plan, net of tax effect of $(28) and $(6), respectively
101 26 
Total other comprehensive (loss) income, net of taxes
(7,632)366 
Comprehensive income
$62,678 $45,856 

See accompanying notes to consolidated financial statements.
6



BENTLEY SYSTEMS, INCORPORATED
Consolidated Statements of Stockholders’ Equity
(in thousands, except share data)
(unaudited)

Three Months Ended March 31, 2024
Accumulated
Class A and Class BAdditionalOtherNon-Total
Common StockPaid-InComprehensiveAccumulatedControllingStockholders’
SharesPar ValueCapitalLossDeficitInterestEquity
Balance, December 31, 2023296,265,837 $2,963 $1,127,234 $(84,987)$(161,932)$704 $883,982 
Net income
— — — — 70,310 — 70,310 
Other comprehensive loss
— — — (7,632)— — (7,632)
Dividends declared— — — — (17,871)— (17,871)
Shares issued in connection with deferred compensation plan
537,745 5 (5)— — —  
Deferred compensation plan elective participant deferrals— — 58 — — — 58 
Shares issued in connection with executive bonus plan
65,939 1 3,350 — — — 3,351 
Shares issued in connection with employee stock purchase plan, net
122,020 1 5,559 — (175)— 5,385 
Stock option exercises, net844,283 8 3,999 — (2,195)— 1,812 
Stock-based compensation expense— — 13,947 — — — 13,947 
Shares related to restricted stock, net481,456 5 (5)— (5,729)— (5,729)
Repurchases of Class B common stock under approved program(302,598)(3)— — (15,003)— (15,006)
Balance, March 31, 2024298,014,682 $2,980 $1,154,137 $(92,619)$(132,595)$704 $932,607 

Three Months Ended March 31, 2023
Accumulated
Class A and Class BAdditionalOtherNon-Total
Common StockPaid-InComprehensiveAccumulatedControllingStockholders’
SharesPar ValueCapitalLossDeficitInterestEquity
Balance, December 31, 2022289,014,487 $2,890 $1,030,466 $(89,740)$(370,866)$704 $573,454 
Net income
— — — — 45,490 — 45,490 
Other comprehensive income
— — — 366 — — 366 
Dividends declared— — — — (14,522)— (14,522)
Shares issued in connection with deferred compensation plan, net
1,052,738 11 (11)— (13,626)— (13,626)
Deferred compensation plan elective participant deferrals— — 1,533 — — — 1,533 
Shares issued in connection with executive bonus plan, net
79,804 1 5,483 — (2,425)— 3,059 
Shares issued in connection with employee stock purchase plan, net
153,381 1 4,556 — (222)— 4,335 
Stock option exercises, net928,300 9 4,193 — (1,701)— 2,501 
Stock-based compensation expense— — 14,625 — — — 14,625 
Shares related to restricted stock, net272,561 3 (3)— (3,025)— (3,025)
Balance, March 31, 2023291,501,271 $2,915 $1,060,842 $(89,374)$(360,897)$704 $614,190 

See accompanying notes to consolidated financial statements.
7



BENTLEY SYSTEMS, INCORPORATED
Consolidated Statements of Cash Flows
(in thousands)
(unaudited)

Three Months Ended
March 31,
20242023
Cash flows from operating activities:
Net income
$70,310 $45,490 
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization16,385 18,057 
Deferred income taxes5,302 (4,178)
Stock-based compensation expense19,658 19,484 
Deferred compensation plan5,799 4,146 
Amortization of deferred debt issuance costs1,823 1,823 
Change in fair value of derivative(2,790)4,489 
Foreign currency remeasurement (gain) loss
(1,744)1,018 
Other1,099 (4,411)
Changes in assets and liabilities, net of effect from acquisitions:
Accounts receivable14,508 15,420 
Prepaid and other assets(5,321)12,137 
Accounts payable, accruals, and other liabilities85,071 53,127 
Deferred revenues(9,257)1,942 
Income taxes payable, net of prepaid income taxes4,126 7,679 
Net cash provided by operating activities
204,969 176,223 
Cash flows from investing activities:
Purchases of property and equipment and investment in capitalized software(3,599)(4,284)
Acquisitions, net of cash acquired  (10,299)
Purchases of investments(250)(6,178)
Net cash used in investing activities
(3,849)(20,761)
Cash flows from financing activities:
Proceeds from credit facilities39,838 117,139 
Payments of credit facilities(131,866)(223,124)
Repayments of term loan(2,500)(1,250)
Payments of contingent and non-contingent consideration(451)(249)
Payments of dividends(17,871)(14,522)
Proceeds from stock purchases under employee stock purchase plan5,560 4,557 
Proceeds from exercise of stock options4,007 4,202 
Payments for shares acquired including shares withheld for taxes(8,099)(20,948)
Repurchases of Class B common stock under approved program(15,006) 
Other(47)(46)
Net cash used in financing activities
(126,435)(134,241)
Effect of exchange rate changes on cash and cash equivalents(1,496)662 
Increase in cash and cash equivalents
73,189 21,883 
Cash and cash equivalents, beginning of year68,412 71,684 
Cash and cash equivalents, end of period
$141,601 $93,567 
8



BENTLEY SYSTEMS, INCORPORATED
Consolidated Statements of Cash Flows
(in thousands)
(unaudited)

Three Months Ended
March 31,
20242023
Supplemental information:
Cash paid for income taxes$11,722 $6,104 
Income tax refunds179 71 
Interest paid5,257 10,473 
Non-cash investing and financing activities:
Cost method investment 3,500 
Deferred, non-contingent consideration, net 525 
Share-settled executive bonus plan awards3,351 5,484 
Deferred compensation plan elective participant deferrals58 1,533 

See accompanying notes to consolidated financial statements.
9



BENTLEY SYSTEMS, INCORPORATED
Notes to Consolidated Financial Statements
(in thousands, except share and per share data)
(unaudited)

Note 1: Basis of Presentation
The accompanying unaudited consolidated financial statements include the accounts of the Company and its consolidated subsidiaries. The accompanying unaudited consolidated financial statements have been prepared in U.S. dollars, and in accordance with U.S. generally accepted accounting principles (“GAAP”) and the rules and regulations of the SEC regarding interim financial reporting. Accordingly, they do not include all the information and notes required by GAAP for annual financial statements. These unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s 2023 Annual Report on Form 10K. In management’s opinion, the accompanying unaudited consolidated financial statements contain all adjustments (consisting of normal, recurring and non-recurring adjustments) that were considered necessary for the fair statement of the Company’s financial position, results of operations, and cash flows as of the dates and for the periods indicated. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect reported amounts in the financial statements and accompanying notes. Actual results could differ materially from those estimates. The December 31, 2023 consolidated balance sheet included herein is derived from the Company’s audited consolidated financial statements.
Note 2: Recent Accounting Pronouncements
In March 2024, the SEC adopted the final rule under SEC Release No. 33‑11275, The Enhancement and Standardization of Climate‑Related Disclosures for Investors. The final rule requires registrants to disclose certain climate‑related information in registration statements and annual reports. The final rule disclosure requirements will begin phasing in prospectively for the Company’s fiscal year beginning January 1, 2025. Subsequent to issuance, the final rule became the subject of litigation and the SEC issued a stay to allow the legal process to proceed. The Company is currently evaluating the impact of the final rule on its disclosures.
In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2023‑09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023‑09”), which expands disclosures in an entity’s income tax rate reconciliation table and regarding cash taxes paid both in the U.S. and foreign jurisdictions. ASU 2023‑09 is effective for the Company for the annual reporting period beginning after December 15, 2024. Early adoption is permitted. The Company is currently evaluating the impact of the adoption of ASU 2023‑09 on its consolidated financial statements and related disclosures.
In November 2023, the FASB issued ASU No. 2023‑07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (“ASU 2023‑07”), which expands disclosures about a public entity’s reportable segments and requires more enhanced information about a reportable segment’s expenses, interim segment profit or loss, and how the Company’s chief operating decision maker (“CODM”) uses reported segment profit or loss information in assessing segment performance and allocating resources. ASU 2023‑07 is effective for the Company for the annual reporting period beginning after December 15, 2023, and interim periods beginning after December 15, 2024. Early adoption is permitted, including adoption in an interim period. The Company is currently evaluating the impact of the adoption of ASU 2023‑07 on its consolidated financial statements and related disclosures.
10



Note 3: Revenue from Contracts with Customers
Disaggregation of Revenues
The Company’s revenues consist of the following:
Three Months Ended
March 31,
20242023
Subscriptions:
Enterprise subscriptions (1)
$127,527 $103,904 
SELECT subscriptions63,541 63,343 
Term license subscriptions116,021 110,598 
Subscriptions307,089 277,845 
Perpetual licenses9,512 9,547 
Subscriptions and licenses316,601 287,392 
Services:
Recurring3,814 4,178 
Other17,348 22,841 
Services21,162 27,019 
Total revenues$337,763 $314,411 
(1)Enterprise subscriptions includes revenue attributable to Enterprise 365 (“E365”) subscriptions of $123,036 and $94,331 for the three months ended March 31, 2024 and 2023, respectively.
The Company recognizes perpetual licenses and the term license component of subscriptions as revenue when either the licenses are delivered or at the start of the subscription term. For the three months ended March 31, 2024 and 2023, the Company recognized $176,309 and $158,024 of license related revenues, respectively, of which $166,797 and $148,477, respectively, were attributable to the term license component of the Company’s subscription based commercial offerings recorded in Subscriptions in the consolidated statements of operations.
The Company derived 7% of its total revenues through channel partners for the three months ended March 31, 2024 and 2023.
Revenue from external customers is attributed to individual countries based upon the location of the customer. Revenues by geographic region are as follows:
Three Months Ended
March 31,
20242023
Americas (1)
$184,193 $168,345 
Europe, the Middle East, and Africa (“EMEA”)94,714 92,832 
Asia-Pacific (“APAC”)
58,856 53,234 
Total revenues$337,763 $314,411 
(1)Americas includes the U.S., Canada, and Latin America (including the Caribbean). Revenue attributable to the U.S. totaled $138,252 and $127,450 for the three months ended March 31, 2024 and 2023, respectively.
11



Unbilled Revenues
Unbilled revenues represent revenues that have not yet been billed to customers due to timing differences in usage and billing cycles, and are included in Accounts receivable in the consolidated balance sheets. As of March 31, 2024 and December 31, 2023, unbilled revenues were $142,361 and $129,494, respectively.
Contract Balances
As of March 31, 2024 and December 31, 2023, the Company’s contract assets relate to performance obligations completed in advance of the right to invoice and are included in Prepaid and other current assets in the consolidated balance sheets. Contract assets were not material as of March 31, 2024 or December 31, 2023.
Deferred revenues consist of billings made or payments received in advance of revenue recognition from subscriptions and services. The timing of revenue recognition may differ from the timing of billings to users. As of March 31, 2024 and December 31, 2023, total deferred revenues on the consolidated balance sheets were $257,243 and $269,647, respectively.
For the three months ended March 31, 2024, $105,678 of revenues that were included in the December 31, 2023 deferred revenues balance were recognized. There were additional deferrals of $96,617 for the three months ended March 31, 2024, which were primarily related to new billings. For the three months ended March 31, 2023, $95,979 of revenues that were included in the December 31, 2022 deferred revenues balance were recognized. There were additional deferrals of $101,577 for the three months ended March 31, 2023, which were primarily related to new billings and acquisitions.
As of March 31, 2024 and December 31, 2023, the Company has deferred $18,323 and $18,269, respectively, related to portfolio balancing exchange rights which is included in Deferred revenues in the consolidated balance sheets.
Remaining Performance Obligations
The Company’s contracts with customers include amounts allocated to performance obligations that will be satisfied at a later date. As of March 31, 2024, amounts allocated to these remaining performance obligations are $257,243, of which the Company expects to recognize approximately 94% over the next 12 months with the remaining amount thereafter.
Note 4: Acquisitions
The aggregate details of the Company’s acquisition activity are as follows:
Acquisitions Completed During
Three Months Ended March 31,
20242023
Number of acquisitions 1 
Cash paid at closing$ $10,299 
Net cash paid$ $10,299 
The operating results of the acquired businesses were not material, individually or in the aggregate, to the Company’s consolidated statements of operations.
12



The fair value of non-contingent consideration from acquisitions is included in the consolidated balance sheets as follows:
March 31, 2024December 31, 2023
Accruals and other current liabilities$2,906 $3,576 
Non-contingent consideration from acquisitions$2,906 $3,576 
The operating results of the acquired businesses are included in the Company’s consolidated financial statements from the closing date of each respective acquisition. The purchase price for each acquisition has been allocated to the net tangible and intangible assets and liabilities based on their estimated fair values at the respective acquisition date.
The Company is in the process of finalizing the purchase accounting for two acquisitions completed during the year ended December 31, 2023. Identifiable assets acquired and liabilities assumed were provisionally recorded at their estimated fair values on the respective acquisition date. The initial accounting for these business combinations is not complete because the evaluation necessary to assess the fair values of certain net assets acquired is still in process. The provisional amounts are subject to revision until the evaluations are completed to the extent that additional information is obtained about the facts and circumstances that existed as of the acquisition date. The allocation of the purchase price may be modified from the date of the acquisition as more information is obtained about the fair values of assets acquired and liabilities assumed, however, such measurement period cannot exceed one year.
Acquisition costs are expensed as incurred and are recorded in General and administrative in the consolidated statements of operations. For the three months ended March 31, 2024 and 2023, the Company’s acquisition costs were $198 and $5,185, respectively, which include costs related to legal, accounting, valuation, insurance, and other consulting and transaction fees.
13



The following summarizes the fair values of the assets acquired and liabilities assumed, as well as the weighted average useful lives assigned to acquired intangible assets at the respective date of each acquisition (including contingent consideration):
Acquisitions Completed During
Year Ended
December 31, 2023
Consideration:
Cash paid at closing$26,287 
Deferred, non-contingent consideration, net525 
Other15 
Total consideration$26,827 
Assets acquired and liabilities assumed:
Cash$264 
Accounts receivable and other current assets1,742 
Operating lease right-of-use assets397 
Deferred income taxes2,151 
Other assets6 
Software and technology (weighted average useful life of 3 years)
3,077 
Customer relationships (weighted average useful life of 6 years)
3,900 
Trademarks (weighted average useful life of 5 years)
1,000 
Total identifiable assets acquired excluding goodwill12,537 
Accruals and other current liabilities(624)
Deferred revenues(4,623)
Operating lease liabilities(397)
Total liabilities assumed(5,644)
Net identifiable assets acquired excluding goodwill6,893 
Goodwill19,934 
Net assets acquired$26,827 
Note 5: Property and Equipment, Net
Property and equipment, net consist of the following:
March 31, 2024December 31, 2023
Land$2,811 $2,811 
Building and improvements30,948 31,025 
Computer equipment and software47,736 46,202 
Furniture, fixtures, and equipment9,627 9,799 
Aircraft2,038 2,038 
Other85 89 
Property and equipment, at cost93,245 91,964 
Less: Accumulated depreciation(54,682)(51,864)
Total property and equipment, net$38,563 $40,100 
Depreciation expense for the three months ended March 31, 2024 and 2023 was $3,367 and $2,724, respectively.
14


Note 6: Goodwill and Other Intangible Assets
The changes in the carrying amount of goodwill are as follows:
Balance, December 31, 2023$2,269,336 
Foreign currency translation adjustments(7,585)
Other adjustments(561)
Balance, March 31, 2024$2,261,190 
Details of intangible assets other than goodwill are as follows:
March 31, 2024December 31, 2023
Estimated
Useful Life
Gross
Carrying
Amount
Accumulated
Amortization
Net Book
Value
Gross
Carrying
Amount
Accumulated
Amortization
Net Book
Value
Intangible assets subject to amortization:
Software and technology
3-5 years
$89,294 $(61,887)$27,407 $89,693 $(59,045)$30,648 
Customer relationships
3-10 years
322,194 (148,581)173,613 323,442 (142,378)181,064 
Trademarks
3-10 years
70,573 (35,249)35,324 70,710 (33,709)37,001 
Non-compete agreements
5 years
350 (292)58 350 (276)74 
Total intangible assets$482,411 $(246,009)$236,402 $484,195 $(235,408)$248,787 
The aggregate amortization expense for purchased intangible assets with finite lives was reflected in the Company’s consolidated statements of operations as follows:
Three Months Ended
March 31,
20242023
Cost of subscriptions and licenses$3,226 $3,187 
Amortization of purchased intangibles8,964 10,548 
Total amortization expense$12,190 $13,735 
Note 7: Investments
Investments consist of the following:
March 31, 2024December 31, 2023
Cost method investments$21,236 $21,044 
Equity method investments2,405 2,436 
Total investments$23,641 $23,480 
Cost Method Investments
The Company invests in technology development companies, generally in the form of equity interests or convertible notes. In March 2023, the Company acquired an equity interest in Worldsensing, a leading global connectivity hardware platform company for infrastructure monitoring, via contribution of its sensemetrics’ Thread connectivity device business (the “Thread business”) and cash. The non‑cash contribution of the Thread business resulted in an insignificant gain, which was recorded in Other income, net in the consolidated statements of operations for the three months ended March 31, 2023.
15


During the three months ended March 31, 2024, the Company invested a total of $250. During the three months ended March 31, 2023, the Company invested a total of $9,678, including $8,928 of cash and non-cash for its investment in Worldsensing. As of March 31, 2024 and December 31, 2023, the Company’s investment balance in Worldsensing was $8,928.
Note 8: Leases
The Company’s operating leases consist of office facilities, office equipment, and automobiles. As of March 31, 2024, the Company’s leases have remaining terms of less than one year to ten years, some of which include one or more options to renew, with renewal terms from one year to five years and some of which include options to terminate the leases from less than one year to five years.
The components of operating lease cost reflected in the consolidated statements of operations were as follows:
Three Months Ended
March 31,
20242023
Operating lease cost (1)
$3,695 $4,628 
Variable lease cost1,173 1,202 
Total operating lease cost$4,868 $5,830 
(1)Operating lease cost includes rent cost related to operating leases for office facilities of $3,471 and $4,417 for the three months ended March 31, 2024 and 2023, respectively.
Supplemental operating cash flows and other information related to leases was as follows:
Three Months Ended
March 31,
20242023
Cash paid for operating leases included in operating cash flows$3,850 $4,710 
Right-of-use assets obtained in exchange for new operating lease liabilities (1)
$1,838 $2,797 
(1)For the three months ended March 31, 2023, right‑of‑use assets obtained in exchange for new operating lease liabilities does not include the impact from an acquisition of $345.
The weighted average remaining lease term for operating leases was 4.5 years and 4.6 years as of March 31, 2024 and December 31, 2023, respectively. The weighted average discount rate was 4.8% as of March 31, 2024 and December 31, 2023.
16



Note 9: Accruals and Other Current Liabilities
Accruals and other current liabilities consist of the following:
March 31, 2024December 31, 2023
Cloud Services Subscription (“CSS”) deposits$370,221 $284,276 
Accrued benefits50,851 39,983 
Accrued compensation42,189 43,316 
Due to customers16,392 16,924 
Accrued indirect taxes10,561 10,722 
Accrued acquisition stay bonus6,594 4,336 
Accrued professional fees5,286 5,970 
Accrued realignment costs4,694 12,459 
Accrued cloud provisioning costs3,630 3,572 
Employee stock purchase plan contributions2,959 5,790 
Non-contingent consideration from acquisitions2,906 3,576 
Deferred compensation plan liabilities2,460 2,355 
Other accrued and current liabilities21,032 24,069 
Total accruals and other current liabilities$539,775 $457,348 
Note 10: Long-Term Debt
Long‑term debt consists of the following:
March 31, 2024December 31, 2023
Credit facility:
Revolving loan facility due November 2025$ $92,028 
Term loan due November 2025187,500 190,000 
Convertible senior notes due January 2026 (the “2026 Notes”)687,830 687,830 
Convertible senior notes due July 2027 (the “2027 Notes”)575,000 575,000 
Unamortized debt issuance costs(14,885)(16,455)
Total debt1,435,445 1,528,403 
Less: Current portion of long-term debt(10,000)(10,000)
Long-term debt$1,425,445 $1,518,403 
The Company had $150 of letters of credit and surety bonds outstanding as of March 31, 2024 and December 31, 2023 under its amended and restated credit agreement, entered into on December 19, 2017 (the “Credit Facility”). As of March 31, 2024 and December 31, 2023, the Company had $849,850 and $757,822, respectively, available under the Credit Facility.
As of March 31, 2024 and December 31, 2023, the Company was in compliance with all debt covenants and none of the conditions of the 2026 Notes or 2027 Notes to early convert had been met.
17



Interest Expense, Net
Interest expense, net consists of the following:
Three Months Ended
March 31,
20242023
Contractual interest expense$(5,414)$(9,310)
Amortization of deferred debt issuance costs(1,823)(1,823)
Other interest expense
(66)(188)
Interest income783 229 
Interest expense, net$(6,520)$(11,092)
The weighted average interest rate on borrowings under the Credit Facility were 7.46% and 6.67% for the three months ended March 31, 2024 and 2023, respectively.
Note 11: Executive Bonus Plan
For the three months ended March 31, 2024 and 2023, the incentive compensation, including cash payments, election to receive shares of fully vested Class B common stock, and deferred compensation to plan participants, recognized under the amended and restated Bentley Systems, Incorporated Bonus Pool Plan (the “Bonus Plan”) (net of all applicable holdbacks) was $7,031 and $7,948, respectively.
Note 12: Retirement Plans
Deferred Compensation Plan
Deferred compensation plan expense was $5,799 and $4,146 for the three months ended March 31, 2024 and 2023, respectively.
For the three months ended March 31, 2024 and 2023, elective participant deferrals into the Company’s unfunded amended and restated Bentley Systems, Incorporated Nonqualified Deferred Compensation Plan (the “DCP”) were $58 and $1,533, respectively. No discretionary contributions were made to the DCP during the three months ended March 31, 2024 and 2023. As of March 31, 2024 and December 31, 2023, 16,847,673 and 17,364,980 phantom shares of the Company’s Class B common stock were distributable under the DCP, respectively. As of March 31, 2024, shares of Class B common stock available for future issuance under the DCP were 4,401,185.
The total liabilities related to the DCP is included in the consolidated balance sheets as follows:
March 31, 2024December 31, 2023
Accruals and other current liabilities$2,460 $2,355 
Deferred compensation plan liabilities93,402 88,181 
Total DCP liabilities$95,862 $90,536 
18



Note 13: Common Stock
BSY Stock Repurchase Program
In May 2022, the Company announced that its Board of Directors approved the BSY Stock Repurchase Program (the “Repurchase Program”) authorizing the Company to repurchase up to $200,000 of the Company’s Class B common stock through June 30, 2024. In December 2022, the Company’s Board of Directors amended the Repurchase Program to allow the Company also to repurchase its outstanding convertible senior notes. This additional authorization did not increase the overall dollar limit of the Repurchase Program. Effective July 1, 2024, the Company’s Board of Directors extended the Repurchase Program, authorizing the Company to repurchase from such date up to $200,000 of the Company’s Class B common stock and/or convertible senior notes through June 30, 2026. The Company’s current authorization under the Repurchase Program expires on June 30, 2024.
The shares and convertible senior notes proposed to be acquired in the Repurchase Program may be repurchased from time to time in open market transactions, through privately negotiated transactions, or by other means in accordance with federal securities laws. The Company intends to fund repurchases from available working capital and cash provided by operating activities. The timing, as well as the number and value of shares and/or convertible senior notes repurchased under the Repurchase Program, will be determined by the Company at its discretion and will depend on a variety of factors, including management’s assessment of the intrinsic value of the Company’s shares, the market price of the Company’s Class B common stock and outstanding convertible senior notes, general market and economic conditions, available liquidity, compliance with the Company’s debt and other agreements, and applicable legal requirements. The exact number of shares and/or convertible senior notes to be repurchased by the Company is not guaranteed, and the Repurchase Program may be suspended, modified, or discontinued at any time without prior notice.
During the three months ended March 31, 2024, the Company repurchased 302,598 shares for $15,006 under the Repurchase Program. The Company did not repurchase shares under the Repurchase Program for the three months ended March 31, 2023. As of March 31, 2024, $154,752 was available under the Company’s Board of Directors authorization for future repurchases of Class B common stock and/or outstanding convertible senior notes under the Repurchase Program.
Common Stock Issuances, Sales, and Repurchases
During the three months ended March 31, 2024, the Company issued 537,745 shares of Class B common stock to DCP participants in connection with distributions from the plan. There were no shares sold back to the Company as they were issued on a gross basis during the three months ended March 31, 2024. During the three months ended March 31, 2023, the Company issued 1,052,738 shares of Class B common stock to DCP participants in connection with distributions from the plan, net of 368,733 shares which were sold back to the Company in the same period to pay for applicable income tax withholdings of $13,626.
During the three months ended March 31, 2024, the Company issued 65,939 shares of Class B common stock in connection with Bonus Plan incentive compensation. There were no shares sold back to the Company as they were issued on a gross basis during the three months ended March 31, 2024. During the three months ended March 31, 2023, the Company issued 79,804 shares of Class B common stock in connection with Bonus Plan incentive compensation, net of 63,310 shares were sold back to the Company in the same period to pay for applicable income tax withholdings of $2,425.
During the three months ended March 31, 2024, the Company issued 844,283 shares of Class B common stock to colleagues who exercised their stock options, net of 67,146 shares withheld at exercise to pay for the cost of the stock options, as well as for $2,195 of applicable income tax withholdings. The Company received $4,007 in cash proceeds from the exercise of stock options. For the three months ended March 31, 2023, the Company issued 928,300 shares of Class B common stock to colleagues who exercised their stock options, net of 73,822 shares withheld at exercise to pay for the cost of the stock options, as well as for $1,701 of applicable income tax withholdings. The Company received $4,202 in cash proceeds from the exercise of stock options.
19



Dividends
The Company declared cash dividends during the periods presented as follows:
Dividend
Per ShareAmount
2024:
First quarter$0.06 $17,871 
2023:
First quarter$0.05 $14,522 
Global Employee Stock Purchase Plan
During the three months ended March 31, 2024, colleagues who elected to participate in the Bentley Systems, Incorporated Global Employee Stock Purchase Plan (the “ESPP”) purchased a total of 122,020 shares of Class B common stock, net of shares withheld, resulting in cash proceeds to the Company of $5,560. Of the total 125,374 shares purchased, 3,354 shares were sold back to the Company to pay for applicable income tax withholdings of $175. During the three months ended March 31, 2023, colleagues who elected to participate in the ESPP purchased a total of 153,381 shares of Class B common stock, net of shares withheld, resulting in cash proceeds to the Company of $4,557. Of the total 159,377 shares purchased, 5,996 shares were sold back to the Company to pay for applicable income tax withholdings of $222. As of March 31, 2024 and December 31, 2023, $2,959 and $5,790 of ESPP withholdings via colleague payroll deduction were recorded in Accruals and other current liabilities in the consolidated balance sheets, respectively. As of March 31, 2024, shares of Class B common stock available for future issuance under the ESPP were 24,150,018.
Note 14: Accumulated Other Comprehensive Loss
Accumulated other comprehensive loss consists of the following during the three months ended March 31, 2024 and 2023:
ForeignActuarial (Loss)
CurrencyGain on
TranslationRetirement PlanTotal
Balance, December 31, 2023$(84,634)$(353)$(84,987)
Other comprehensive (loss) income, before taxes
(7,733)129 (7,604)
Tax expense (28)(28)
Other comprehensive (loss) income, net of taxes
(7,733)101 (7,632)
Balance, March 31, 2024$(92,367)$(252)$(92,619)
ForeignActuarial (Loss)
CurrencyGain on
TranslationRetirement PlanTotal
Balance, December 31, 2022$(89,408)$(332)$(89,740)
Other comprehensive income, before taxes
340 32 372 
Tax expense (6)(6)
Other comprehensive income, net of taxes
340 26 366 
Balance, March 31, 2023$(89,068)$(306)$(89,374)
20



Note 15: Stock-Based Compensation
Total stock‑based compensation expense consists of the following:
Three Months Ended
March 31,
20242023
Restricted stock and restricted stock units (“RSUs”) expense
$13,690 $13,923 
Bonus Plan expense (see Note 11)5,301 4,546 
ESPP expense (see Note 13)624 575 
Stock option expense 343 
DCP elective participant deferrals expense (1) (see Note 12)
43 97 
Total stock-based compensation expense (2)
$19,658 $19,484 
(1)DCP elective participant deferrals expense excludes deferred incentive bonus payable pursuant to the Bonus Plan.
(2)As of March 31, 2024 and December 31, 2023, $6,300 and $4,043 remained in Accruals and other current liabilities in the consolidated balance sheets, respectively.
Total stock‑based compensation expense is included in the consolidated statements of operations as follows:
Three Months Ended
March 31,
20242023
Cost of subscriptions and licenses$1,094 $1,034 
Cost of services882 1,007 
Research and development4,881 5,286 
Selling and marketing2,778 2,870 
General and administrative10,023 9,287 
Total stock-based compensation expense$19,658 $19,484 
Stock‑based compensation expense is measured at the grant date fair value of the award and is recognized ratably over the requisite service period, which is generally the vesting period. Specifically for performance‑based RSUs, stock‑based compensation expense is measured at the grant date fair value of the award and is recognized ratably over the requisite service period based on the number of awards expected to vest at each reporting date. The Company accounts for forfeitures of equity awards as those forfeitures occur.
Bentley Systems, Incorporated 2020 Omnibus Incentive Plan
The Bentley Systems, Incorporated 2020 Omnibus Incentive Plan (the “2020 Plan”) provides for the granting of stock, stock options, restricted stock, RSUs, and other stock‑based or performance‑based awards to certain directors, officers, colleagues, consultants, and advisors of the Company, and terminates in September 2030. The 2020 Plan provides that 25,000,000 shares of Class B common stock may be issued for equity awards. Equity awards that are expired, canceled, forfeited, or terminated for any reason will be available for future grant under the 2020 Plan. As of March 31, 2024, equity awards available for future grants under the 2020 Plan were 20,273,484.
21



Restricted Stock and RSUs
Under the equity incentive plans, the Company may grant both time‑based and performance‑based shares of restricted Class B common stock and RSUs to eligible colleagues. Time‑based awards generally vest ratably on each of the first four anniversaries of the grant date. Performance‑based awards vesting is determined by the achievement of certain business growth targets, which include growth in annualized recurring revenues (“ARR”), as well as actual bookings for perpetual licenses and non‑recurring services. Performance targets are generally set for performance periods of one year to three years.
The following is a summary of unvested restricted stock and RSU activity and related information under the Company’s applicable equity incentive plans:
Time-Performance-
BasedBased
Time-WeightedWeighted
TotalBasedAverageAverage
RestrictedRestrictedPerformance-Grant DateGrant Date
StockStockBasedFair ValueFair Value
and RSUsand RSUsRSUsPer SharePer Share
Unvested, December 31, 20233,303,849 2,938,208 
(3)
365,641 
(4)
$39.87 $39.21 
Granted830,534 
(1)
670,560 159,974 
(5)
51.3648.60
Vested(606,781)(424,991)(181,790)40.30 39.15 
Forfeited and canceled(55,497)(55,497) 36.01 0.00 
Unvested, March 31, 20243,472,105 
(2)
3,128,280 
(3)
343,825 $42.34 $43.61 
(1)For the three months ended March 31, 2024, the Company only granted RSUs.
(2)Includes 51,638 RSUs which are expected to be settled in cash.
(3)Includes 199,076 time‑based RSUs granted during the three months ended March 31, 2022 to certain officers and key employees, which cliff vest on January 31, 2025.
(4)Primarily relates to the 2023 annual performance period, except for 185,186 performance‑based RSUs granted during the year ended December 31, 2022 with extraordinary terms, which are described below.
(5)Primarily relates to the 2024 annual performance period, except for 1,335 additional shares earned based on the achievement of 2023 performance goals for performance-based RSUs granted during the year ended December 31, 2023.
During the year ended December 31, 2022, the Company granted 185,186 performance‑based RSUs to certain officers and key employees, which vest subject to the achievement of certain performance goals over a three‑year performance period (the “Performance Period”). For each year of the Performance Period, one‑third of the performance‑based RSUs will be subject to a cliff, whereby no vesting of that portion will occur unless the Company’s applicable margin metrics (which, for 2022 was Adjusted EBITDA margin, and for 2023 was and 2024 will be Adjusted operating income inclusive of stock-based compensation expense (“Adjusted OI w/SBC”) margin, excluding the impact of foreign currency exchange fluctuations) also equals or exceeds the relevant target level for such year. Provided that the applicable margin targets are met, the total number of performance‑based RSUs that will vest is determined by the achievement of growth targets, which include growth in ARR, as well as actual bookings for perpetual licenses and non‑recurring services. Final actual vesting will be determined on January 31, 2025. The 2023 Adjusted OI w/SBC margin target, excluding the impact of foreign currency exchange fluctuations, and the 2022 Adjusted EBITDA margin target for the performance‑based RSUs were met.
The weighted average grant date fair values of RSUs granted were $50.83 and $40.73, for the three months ended March 31, 2024 and 2023, respectively.
For the three months ended March 31, 2024 and 2023, restricted stock and RSUs were issued net of 113,790 and 78,993 shares, respectively, which were sold back to the Company to settle applicable income tax withholdings of $5,729 and $3,025, respectively.
22



As of March 31, 2024, there was $102,848 of unrecognized compensation expense related to unvested time‑based restricted stock and RSUs, which is expected to be recognized over a weighted average period of approximately 2.0 years. As of March 31, 2024, there was $9,208 of unrecognized compensation expense related to unvested performance‑based RSUs, which is expected to be recognized over a weighted average period of approximately 0.8 years.
Stock Options
The following is a summary of stock option activity and related information under the Company’s applicable equity incentive plans:
Weighted
Average
StockExercise Price
OptionsPer Share
Outstanding, December 31, 2023916,429 $5.74 
Exercised(911,429)5.74 
Forfeited and expired(5,000)5.74 
Outstanding, March 31, 2024 $ 
For the three months ended March 31, 2024 and 2023, the Company received cash proceeds of $4,007 and $4,202, respectively, related to the exercise of stock options. The total intrinsic value of stock options exercised for the three months ended March 31, 2024 and 2023 was $40,775 and $35,076, respectively.
As of March 31, 2024, there was no remaining unrecognized compensation expense related to unvested stock options.
Note 16: Income Taxes
The following is a summary of Income before income taxes, Provision for income taxes, and effective tax rate for the periods presented:
Three Months Ended
March 31,
20242023
Income before income taxes
$92,548 $54,982 
Provision for income taxes
$22,247 $9,492 
Effective tax rate24.0 %17.3 %
For the three months ended March 31, 2024, the effective tax rate was higher compared to the same period in the prior year primarily due to the decrease in discrete tax benefits recognized in the current year period. For the three months ended March 31, 2024 and 2023, the Company recorded discrete tax benefits of $2,138 and $7,073, respectively, primarily associated with windfall tax benefits from stock‑based compensation, net of the impact from officer compensation limitation provisions.
23



Note 17: Fair Value of Financial Instruments
A financial asset or liability classification is determined based on the lowest level input that is significant to the fair value measurement. The fair value hierarchy consists of the following three levels:
Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument.
Level 3 inputs are unobservable inputs based on management’s own assumptions used to measure assets and liabilities at fair value.
The Company’s financial instruments include cash equivalents, account receivables, certain other assets, accounts payable, accruals, certain other current and long‑term liabilities, and long‑term debt.
Current Assets and Current Liabilities — In general, the carrying amounts reported on the Company’s consolidated balance sheets for current assets and current liabilities approximate their fair values due to the short‑term nature of those instruments.
The following methods and assumptions were used by the Company in estimating its fair value measurements for Level 2 and Level 3 financial instruments as of March 31, 2024 and December 31, 2023:
Interest Rate Swap — The fair value of the Company’s interest rate swap asset or liability is determined using an income approach and is measured based on the implied forward rates for the remaining term of the interest rate swap. The Company considers these valuation inputs to be Level 2 inputs in the fair value hierarchy.
Long-Term Debt — The fair value of the Company’s borrowings under its Credit Facility approximated its carrying value based upon discounted cash flows at current market rates for instruments with similar remaining terms. The Company considers these valuation inputs to be Level 2 inputs in the fair value hierarchy. As of March 31, 2024, the estimated fair value of the 2026 Notes and 2027 Notes was $692,789 and $516,419, respectively. As of December 31, 2023, the estimated fair value of the 2026 Notes and 2027 Notes was $684,205 and $516,051, respectively. The estimated fair value of the 2026 Notes and 2027 Notes is based on quoted market prices of the Company’s instrument in markets that are not active and are classified as Level 2 within the fair value hierarchy. Considerable judgment is necessary to interpret the market data and develop estimates of fair values. Accordingly, the estimates presented are not necessarily indicative of the amounts at which these instruments could be purchased, sold, or settled.
Deferred Compensation Plan Liabilities — The fair value of deferred compensation plan liabilities, including the liability classified phantom investments in the DCP, are marked to market at the end of each reporting period.
24



Financial assets and financial liabilities carried at fair value measured on a recurring basis consist of the following:
March 31, 2024Level 1Level 2Total
Assets:
Money market funds (1)
$36,299 $ $36,299 
Interest rate swap (2)
 34,952 34,952 
Total assets$36,299 $34,952 $71,251 
Liabilities:
Deferred compensation plan liabilities (3)
$95,862 $ $95,862 
Cash-settled equity awards (4)
1,102  1,102 
Total liabilities$96,964 $ $96,964 
December 31, 2023Level 1Level 2Total
Assets:
Money market funds (1)
$1 $ $1 
Interest rate swap (2)
 32,162 32,162 
Total assets$1 $32,162 $32,163 
Liabilities:
Deferred compensation plan liabilities (3)
$90,536 $ $90,536 
Cash-settled equity awards (4)
781  781 
Total liabilities$91,317 $ $91,317 
(1)Included in Cash and cash equivalents in the consolidated balance sheets.
(2)Included in Other assets in the consolidated balance sheets.
(3)Included in Deferred compensation plan liabilities, except for current liabilities of $2,460 and $2,355 as of March 31, 2024 and December 31, 2023, respectively, which are included in Accruals and other current liabilities in the consolidated balance sheets.
(4)Included in Accruals and other current liabilities in the consolidated balance sheets.
The Company did not have any transfers between levels within the fair value hierarchy.
Note 18: Commitments and Contingencies
Purchase Commitments
In the normal course of business, the Company enters into various purchase commitments for goods and services. During the year ended December 31, 2023, the Company entered into approximately $158,000 of non‑cancelable future cash purchase commitments for services related to cloud provisioning of the Company’s software solutions and for other software costs. As of March 31, 2024, total non‑cancelable future cash purchase commitments were approximately $116,500 to be paid through September 2028. The Company expects to fully consume its contractual commitments in the ordinary course of operations.
Litigation
From time to time, the Company is involved in certain legal actions arising in the ordinary course of business. In management’s opinion, based upon the advice of counsel, the outcome of such actions is not expected to have a material adverse effect on the Company’s future financial position, results of operations, or cash flows.
25


Note 19: Geographic Data
Revenues by geographic region are presented in Note 3. Long‑lived assets (other than goodwill), net of depreciation and amortization by geographic region (see Notes 5, 6, and 8) are as follows:
March 31, 2024December 31, 2023
Americas (1)
$259,741 $272,492 
EMEA38,353 40,411 
APAC13,325 14,460 
Total long-lived assets$311,419 $327,363 
(1)Americas includes the U.S., Canada, and Latin America (including the Caribbean).
Note 20: Other Income, Net
Other income, net consists of the following:
Three Months Ended
March 31,
20242023
Gain (loss) from:
Change in fair value of interest rate swap (see Note 17)$2,790 $(4,489)
Foreign exchange (1)
2,342 1,454 
Receipts related to interest rate swap
2,357 1,920 
Other (expense) income, net
(352)1,404 
Total other income, net
$7,137 $289 
(1)Foreign exchange gain is primarily attributable to foreign currency translation derived mainly from U.S. dollar denominated cash and cash equivalents, account receivables, customer deposits, and intercompany balances held by foreign subsidiaries. Intercompany finance transactions primarily denominated in U.S. dollars resulted in unrealized foreign exchange (losses) gains of $(394) and $861 for the three months ended March 31, 2024 and 2023, respectively.
26


Note 21: Realignment Costs
During the fourth quarter of 2023, the Company approved a strategic realignment program to better serve the Company’s accounts and to better align resources with the strategy of the business, including reinvestment in go-to-market functions, as well as in artificial intelligence product development (the “2023 Program”). The Company incurred realignment costs of $12,579 for the year ended December 31, 2023 related to the aforementioned program, which represents termination benefits for colleagues whose roles were impacted. During the first quarter of 2024, the Company incurred realignment costs of $24 for the three months ended March 31, 2024 related to the aforementioned program. The 2023 Program activities have been broadly implemented across the Company’s various businesses with the intention that all actions, including payment of the termination benefits, will be substantially complete by the end of the second quarter of 2024.
Realignment costs by expense classification were as follows:
Three Months Ended
March 31, 2024
Cost of revenues:
Cost of subscriptions and licenses$(80)
Cost of services31 
Total cost of revenues(49)
Operating expenses:
Research and development(71)
Selling and marketing678 
General and administrative(534)
Total operating expenses73 
Total realignment costs$24 
Accruals and other current liabilities in the consolidated balance sheets included amounts related to the realignment activities as follows:
Balance, December 31, 2023$12,459 
Realignment costs24 
Payments(7,517)
Adjustments (1)
(272)
Balance, March 31, 2024$4,694 
(1)Adjustments include foreign currency translation.
Note 22: Net Income Per Share
The Company issues certain performance-based RSUs determined to be participating securities because holders of such shares have non-forfeitable dividend rights in the event of the Company’s declaration of a dividend for common shares. As of March 31, 2024 and 2023, there were 343,825 and 387,237 participating securities outstanding, respectively.
Undistributed net income allocated to participating securities are subtracted from net income in determining basic net income attributable to common stockholders. Basic net income per share is computed by dividing basic net income attributable to common stockholders by the weighted average number of shares, inclusive of undistributed shares held in the DCP as phantom shares of the Company’s Class B common stock.
27


For the Company’s diluted net income per share numerator, interest expense, net of tax, attributable to the assumed conversion of the convertible senior notes is added back to basic net income attributable to common stockholders. For the Company’s diluted net income per share denominator, the basic weighted average number of shares is adjusted for the effect of dilutive securities, including awards under the Company’s equity compensation plans and ESPP, and for the dilutive effect of the assumed conversion of the convertible senior notes. Diluted net income per share attributable to common stockholders is computed by dividing diluted net income attributable to common stockholders by the weighted average number of fully diluted common shares.
Except with respect to voting and conversion, the rights of the holders of the Company’s Class A common stock and the Company’s Class B common stock are identical. Each class of shares has the same rights to dividends and allocation of income (loss) and, therefore, net income per share would not differ under the two‑class method.
The details of basic and diluted net income per share are as follows:
Three Months Ended
March 31,
20242023
Numerator:
Net income
$70,310 $45,490 
Less: Net income attributable to participating securities
(21)(19)
Net income attributable to Class A and Class B common stockholders, basic
70,289 45,471 
Add: Interest expense, net of tax, attributable to assumed conversion of convertible senior notes1,723 1,717 
Net income attributable to Class A and Class B common stockholders, diluted
$72,012 $47,188 
Denominator:
Weighted average shares, basic314,295,102 310,758,802 
Dilutive effect of stock options, restricted stock, and RSUs1,686,026 2,844,855 
Dilutive effect of ESPP8,604