AVPT

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How AVPT rewrote its risk factors

10-K ITEM 1A · FY2024 → FY2025

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This section generally discusses the results of our operations for the year ended December 31, 2025 compared to the year ended December 31, 2024.
For a discussion of the year ended December 31, 2024 compared to the year ended December 31, 2023, please refer to Part II, Item 7, “ Management ’s Discussion and Analysis of Financial Condition and Results of Operations ” in our Annual Report on Form 10-K for the year ended December 31, 2024 , which discussion is incorporated herein by reference. 2025 Business Highlights ■ As of December 31, 2025, total annual recurring revenue (“ ARR ”) was $416.8 million, representing 27% year-over-year growth.
On a foreign exchange (“ FX ”) adjusted basis, total ARR increased 26% year-over-year; ■ Total revenue increased 27% year-over-year to $419.5 million.
On a constant currency basis, total revenue increased 25% year-over-year; ■ SaaS revenue increased 38% year-over-year to $319.2 million and represented 76% of total revenue, compared to 70% of revenue in 2024.
On a constant currency basis, SaaS revenue increased 36% year-over-year; ■ GAAP operating income was $33.0 million, compared to GAAP operating income of $7.2 million in 2024.
Non-GAAP operating income was $79.2 million, compared to non-GAAP operating income of $47.6 million in 2024; and ■ Net cash provided by operating activities was $85.3 million, representing 20% of revenue, compared to $88.9 million, representing 27% of revenue, for the year ended December 31, 2024.
Overview AvePoint is the global leader in modern data protection, delivering a unified platform that enables organizations to secure, govern, and operationalize data at scale.
Serving customers of all sizes across every major industry and geography, AvePoint addresses one of the most critical challenges facing enterprises today: how to safely unlock the value of data in a world increasingly driven by artificial intelligence (“ AI ”).
As organizations rapidly embed AI into their core business processes, data has become both their most valuable asset and their greatest source of risk.
AI systems amplify the consequences of poor data hygiene: overexposed sensitive information, accelerating compliance failures, and an increased blast radius from breaches and operational disruptions.
As a result, enterprises require a modern data foundation that ensures data is discoverable, classified, governed, protected, and recoverable by design.
The AvePoint Confidence Platform delivers this foundation.
Purpose-built for today’s cloud-first environments, the platform addresses four pervasive and interconnected data challenges that directly impact enterprise risk, cost, and growth: 1.
Legacy and fragmented data, which undermines visibility, governance, and AI readiness; 2.
Overexposed data, which increases security, privacy, and regulatory risk; 3.
Digital sprawl, which drives operational complexity and rising total cost of ownership; and 4.
Data loss and interruption, which threaten business continuity and organizational resilience.
By solving these challenges through a single, integrated platform, AvePoint enables organizations to reduce risk, lower complexity, and accelerate time to value from their data.
In an era where trusted data is a prerequisite for AI adoption, data protection is no longer a back-office IT function, it is a strategic business imperative.
PART II Item 7 Key Business Metric Our management reviews the following key business metric to measure our performance, identify trends affecting our business, formulate business plans, make strategic decisions, and effectively allocate resources.
We believe that both management and investors benefit from referring to this metric to evaluate progress against our growth strategies and gain additional transparency into performance trends.
Annual Recurring Revenue December 31, 2025 2024 Total ARR ($ in mil) $ 416.8 $ 327.0 We believe ARR enables measurement of our business performance, is an important metric for financial forecasting, and better enables us to make strategic business decisions.
We calculate ARR as the annualized sum of contractually obligated Annual Contract Value (“ ACV ”) from SaaS, term license and support, and maintenance revenue sources from all active customers at the end of a reporting period.
As of December 31, 2025 and 2024, total ARR was $416.8 million and $327.0 million, respectively, representing growth of 27%.
Adjusted for FX, total ARR increased 26% year-over-year.
Growth in ARR is driven by both new customer acquisition and the expansion of existing customer relationships.
ARR should be viewed independently of revenue and deferred revenue and is not intended to be combined with or replace these items.
ARR is not a forecast of future revenue, and the active contracts used in calculating ARR may or may not be extended or renewed by our customers.
PART II Item 7 Components of Results of Operations Revenue We generate revenue from four primary sources: SaaS, term license and support, services, and maintenance.
We consider SaaS, term license and support, and maintenance revenues to be recurring.
SaaS revenues are generated from our cloud-based solutions.
Term license and support revenues are generated from the sales of on-premise or hybrid licenses which include a distinct support component.
Both SaaS and term license and support revenues are primarily billed annually.
SaaS and term license and support are generally sold per user license or based upon the amount of data protected.
SaaS revenue is recognized ratably over the term of the contract.
For term license and support revenue, the license component is generally recognized upfront at the point in time when the software is made available to the customer to download and use, and the support component is recognized ratably over the term of the contract.
Services revenue includes revenue generated from implementation, training, consulting, license customization and managed services.
These revenues are recognized by applying a measure of progress, such as labor hours, to determine the percentage of completion of each contract.
These offerings are not inherently recurring in nature and as such are subject to more period-to-period volatility than other elements of our business.
Services revenue from managed services are recognized ratably or on a straight-line basis over the contract term.

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RISK FACTORS Certain factors may have a material adverse effect on our business, financial condition, and results of operations.
You should consider carefully the risks and uncertainties described below, in addition to other information contained in this Annual Report, including our consolidated financial statements and related notes.
The risks and uncertainties described below are not the only ones we face.
Additional risks and uncertainties that we are unaware of, or that we currently believe are not material, may also become important factors that adversely affect our business.
If any of the following risks actually occurs, our business, financial condition, results of operations, and future prospects could be materially and adversely affected.
In that event, the trading price of our common stock could decline, and you could lose part or all of your investment.
Risks Related to Our Business Our success depends on our technology partners.
In particular, our technical advantages are highly dependent on our partnership with Microsoft and other major software providers.
Should Microsoft or these other providers acquire competitors that heavily overlap with our capabilities, or develop competing features, we may lose customer acquisition momentum and fail to secure renewals or growth targets.
The significant majority of our customers choose to integrate their products and services with, or as an enhancement of, third-party solutions such as infrastructure, platforms or applications, in particular from Microsoft.
The functionality and popularity of our products and services depend largely on our ability to integrate our platform with third-party solutions, in particular Microsoft’s Azure, SharePoint, and Office 365.
We are dependent on technology partner solutions for several major categories of our offerings, including data management, migration, governance, protection and backup.
As a result, our customers’ satisfaction with our products are highly dependent on their perception of, and satisfaction with, our third-party providers and their respective offerings.
We will continue to depend on various third-party relationships to sustain and grow our business.
Third-party providers may change the features of their solutions, alter their governing terms, or end the solutions’ availability altogether.
They may restrict our ability to add, customize or integrate systems, functionality and customer experiences.
Any such changes could limit or terminate our ability to use these third-party solutions and provide our customers with the full range of our products and services.
Our business would be negatively impacted if we fail to retain these relationships for any reason, including due to third parties’ failure to support or secure their technology or integrations; errors, bugs, or defects in their technology; or changes in our products and services.
Any such failure, as well as a prolonged disruption, a cybersecurity event or any other negative event affecting our third-party providers and leading to customer dissatisfaction, could harm our relationship with our customers, our reputation and brand, our revenue, our business, and our results of operations.
Strategic technology partners and third parties may not be successful in building integrations, co-marketing our products and services to provide significant volume and quality of lead referrals or continue to work with us as their respective products evolve.
Identifying, negotiating and documenting relationships with additional strategic technology partners require significant resources.
Integrating third-party technology can be complex, costly and time-consuming.
Third parties may be unwilling to build integrations.
We may be required to devote additional resources to develop integrations for our own products.
Strategic technology partners or providers of solutions with which we have integrations may decide to compete with us or enter into arrangements with our competitors, resulting in such partners or providers withdrawing support for our integrations.
Our agreements with our partners are generally non-exclusive, meaning our partners may offer products from several different companies to their customers.
Specifically, Microsoft and other major platform providers could end partnerships, cease marketing our offerings, with limited or no notice and with little or no penalty, or decide to purchase strong competition, or incorporate our capabilities into native solutions.
Any of these developments would negatively impact our business.
Microsoft and other cloud platform providers may furthermore introduce functionality that competes with our products and services, as a result of an acquisition, or their own development.
Additionally, we rely heavily on our early access to preview Microsoft technology, which enables our product strategy and development teams to anticipate future opportunities as well as validate our current direction.
In situations where Microsoft introduces competitive features to our products, including a Microsoft premium option, some customers will choose a simpler first-party solution to their problem, even at a greater cost to them.
Microsoft and other cloud providers may also choose to make it difficult for third party providers like us to continue making the necessary application programming interface (“ API ”) calls to provide their solutions, as illustrated by an increase in API “throttling” in recent years or API quotas provided by Salesforce.
P ART I Item 1A Although we typically receive significant advance notice of new product releases from Microsoft, Microsoft does not always preview their technology with us or other partners and, as a result, it is possible that we may not receive advance notice of changes in features and functionality of new technologies with which our products will need to interoperate.
If this was to happen, there could be an increased risk of product incompatibility.
Any failure of our products and services to operate effectively with solutions could result in customer dissatisfaction and harm to our business, and could reduce the demand for our products and services.
If we are unable to respond to these changes or failures in a cost-effective manner, our products and services may become less marketable, less competitive, or obsolete, and the results of our operations may be negatively impacted.
We have a strategic technology partnership with Microsoft for the collaboration to co-sell and co-market our products and services to new customers.
If our relationships with our strategic technology partners, such as Microsoft, are disrupted or if the co-sell and co-market program was ended for any reason, we may receive less revenue and incur costs to form other revenue-generating strategic technology partnerships.
We have experienced strong growth in recent periods, and our recent growth rates may not be indicative of our future growth.
We have experienced strong growth in recent periods.

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Sentence-level comparison of Item 1A in the two most recent 10-Ks (FY2024 ↗, FY2025 ↗). A reworded sentence counts as one dropped and one added, so heavy edits read as low “kept”. Headings and page furniture are stripped; nothing is summarised by a model.

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