Core Insights - Kaltura has launched a new AI-powered Accessibility Agent to help organizations comply with upcoming digital accessibility regulations, particularly for video content [1][3][4] Group 1: Regulatory Context - New Title II regulations in the U.S. and the European Accessibility Act mandate that all video content must be fully accessible, including captioning and audio descriptions, by April 2026 [2] - Institutions with extensive video libraries face significant challenges in assessing compliance due to the manual nature of the process [2] Group 2: Product Features and Benefits - The Kaltura Accessibility Agent automates the process of ensuring video content meets accessibility standards, including adding necessary features before publication [3] - The solution not only aids compliance but also enhances student engagement and retention through improved accessibility features like closed captions and interactive transcripts [4] Group 3: Market Trends and Future Directions - There is a growing trend among forward-thinking enterprises to prioritize accessibility for both employees and customers, seeking AI-powered solutions for inclusivity [5] - Kaltura will showcase its Accessibility Agent and other AI solutions at the upcoming EDUCAUSE annual conference, highlighting practical strategies for compliance and innovation in accessibility [5]

NEW YORK, Oct. 22, 2025 (GLOBE NEWSWIRE) -- Kaltura (Nasdaq: KLTR), the AI Video Experience Cloud, today announced it will release its third quarter financial results for the period ended September 30, 2025, after market close on Monday, November 10, 2025. Management will host a conference call to review the Company’s third quarter 2025 financial results and discuss the financial outlook. Date:Time:United States/Canada Toll Free:International Toll:Monday, November 10, 20255:00 p.m. ET1-877-407-0789+1-201-68 ...

The report also found that ease of use takes precedence over perfection, with 72% of video producers stating they would rather use software that integrates multiple steps, in place of best-of-breed point solutions.New York, Oct. 07, 2025 (GLOBE NEWSWIRE) -- Kaltura (Nasdaq: KLTR), the AI Video Experience Cloud, and IntelliVid Research, today released a new report, The State of AI Video in the Enterprise, offering a comprehensive overview of how advanced video technology and artificial intelligence are being ...

NEW YORK, Oct. 06, 2025 (GLOBE NEWSWIRE) -- Kaltura, Inc. (Nasdaq: KLTR, “Kaltura” or the “Company”), the Video Experience Cloud, today announced that John Doherty, Chief Financial Officer, will be stepping down effective December 5, 2025. Mr. Doherty informed the Company that he is taking on a chief financial officer role at a public company in the medical technology industry. The Company has retained an external search firm to identify successor candidates. In addition, Mr. Doherty has agreed to stay on a ...

Core Insights - Kaltura is set to unveil its new Media Publishing Agent at IBC 2025, aimed at delivering hyper-personalized, compliant, and revenue-optimized content experiences at scale [1][4] - The Media Publishing Agent automates the publishing workflow, enhancing efficiency and ensuring content consistency across various services [2][3] Company Developments - The Media Publishing Agent allows for precise publishing workflows, including compliance checks and metadata enrichment, which can be monitored and adjusted via dashboards [2] - Kaltura's Chief Product & Engineering Officer highlighted the agent as a critical tool for media companies to leverage AI for future-proofing their businesses and driving efficiency [3] Product Features - The Media Publishing Agent supports scalable monetization strategies by enabling faster turnaround for live and on-demand services, better personalization, and streamlined localization [3] - Kaltura's suite of AI-powered solutions includes the award-winning TV Genie, which enhances viewing experiences and recommendations [4] Market Positioning - Kaltura will also launch its new Cloud TV Marketplace at IBC, providing customers with the ability to explore and activate integrations and AI-powered features tailored to their needs [4]

Kaltura (KLTR) 2025 Conference Summary Company Overview - Kaltura is a leading provider of video technology, offering solutions for enterprises, educational institutions, and media companies globally. Their platform supports various applications, including virtual events, corporate communications, online learning, and streaming TV [1][3]. Core Business and Product Offerings - Kaltura's mission is to create AI-infused, hyper-personalized video experiences that enhance customer and employee engagement [3]. - The Kaltura Video Experience Cloud serves three main markets: 1. Enterprise Video Content Management (EVCM) and Online Video Platform (OVP) 2. Virtual events and webinars 3. Cloud TV software [6][7]. - The platform includes a video portal, LMS integrations, virtual event systems, conferencing products, and TV streaming applications [8][9]. Customer Base and Market Penetration - Kaltura serves over 850 large organizations, powering more than 10 million active users, including major companies like Amazon, Nvidia, and Salesforce [17][18]. - The company claims to cover 50% of R1 schools in the U.S. for various video-related needs [18]. - Kaltura has a long-standing relationship with Vodafone, extending their partnership for another ten years [18]. Financial Performance and Market Trends - Kaltura has maintained growth even during challenging market conditions, with a focus on profitability. The company reported a negative cash flow of $47 million in 2022 but expects to achieve $15 million in adjusted EBITDA for the current year [31][34]. - The company has seen a shift in its revenue streams, with non-media use cases (marketing, sales, training) performing better than media-related revenues [20][27]. - The average annual recurring revenue (ARR) is increasing as customers consume more products and use cases [19]. Future Outlook and Strategic Initiatives - Kaltura aims to double its adjusted EBITDA by 2026, targeting a long-term goal of at least 10% revenue growth and 20% adjusted EBITDA [34][35]. - The company is focusing on AI-infused experiences to enhance content creation and delivery, which is expected to drive future growth [23][39]. - Kaltura is positioned to capitalize on the rebound of the video market post-COVID, with increasing budgets and a hybrid workforce [36][37]. Competitive Landscape - Kaltura differentiates itself through deep API integration, flexibility, and a comprehensive platform that reduces vendor complexity [21][22]. - The company sees opportunities for consolidation in a fragmented market, where many smaller vendors are struggling [41][42]. - Kaltura's average revenue per unit (ARPU) for enterprise customers is significantly higher than competitors like Vimeo, indicating a strong position in the enterprise segment [57]. Conclusion - Kaltura is well-positioned to leverage its technology and customer base to capture growth in the evolving video market. The focus on AI and hyper-personalization, combined with a robust financial strategy, suggests a positive outlook for the company moving forward [49][50].

Core Insights - Kaltura announced the winners of the 2025 Kaltura Digital Engagement Awards in Education, recognizing educators and institutions that enhance digital engagement, accessibility, and personalization through AI Video Campus solutions [1][5] - The Kaltura Connect in Education conference featured discussions on the evolving role of video and AI in higher education, with a focus on accessibility and compliance with Title II [4][6] Event Highlights - The conference was held at prestigious universities such as The University of Michigan, Rutgers Business School, UCLA, and The Utah Education Network [2] - Panels included discussions on best practices for AI implementations that align with institutional accessibility standards, ensuring inclusivity and effectiveness in digital learning environments [4] Award Winners - Wharton Online received the Video-First Educator Award for its innovative use of video lectures and expert interviews to enhance business education [6] - The Manhattan School of Music was honored with the Live Performance Powerhouse Award for its extensive live music streaming and concert broadcasts [6] - Academy of Art University won the Video Innovation Excellence Award for its leadership in multi-camera visual instruction [6] - UC Santa Cruz (SCOUT) was recognized with the Video Education Excellence Award for its A-G course video library supporting college access [6] - UCLA received the Strategic Video Leadership Award for aligning digital media infrastructure with campus-wide strategies, including plans for the 2028 Olympics [6] Accessibility and Security Initiatives - UC Berkeley, Rutgers, and the University of Cincinnati were awarded the Accessibility Advocate Award for establishing standards for accessibility in content and pedagogy [9] - Rice University won the Security Superstar Award for its efforts in enhancing video security across the institution [9]

Financial Data and Key Metrics Changes - Total revenue for Q2 2025 was $44.5 million, up 1% year over year, while subscription revenue was $42.4 million, up 3% year over year [5][22] - Adjusted EBITDA was $4.1 million, consistent with the record from Q1 2025, marking the eighth consecutive quarter of adjusted EBITDA profitability [6][27] - Non-GAAP net profit reached $2.5 million, an improvement of $4.5 million year over year [6][29] - Cash flow from operations was $2.7 million, the highest second quarter result since 2020 [7][29] Business Line Data and Key Metrics Changes - E and T segment revenue grew by 7% year over year to $33.2 million, with subscription revenue up 9% to $32.6 million [24] - M and T segment revenue declined by 14% year over year to $11.2 million, with subscription revenue down 13% to $9.8 million [25] - Average ARR per customer reached a record high, indicating strong customer consolidation around the platform [8][19] Market Data and Key Metrics Changes - The company reported a net dollar retention rate of 101%, above 100% for the fourth consecutive quarter [10][23] - The company anticipates improved M and T gross retention rates in Q4 2025, supported by a renewed contract with Vodafone [6][25] Company Strategy and Development Direction - The company is focusing on enhancing its AI offerings, with plans to expand its AI agents and improve automation in content publishing [12][18] - A reorganization plan was announced, involving a 10% workforce reduction aimed at increasing efficiency and productivity [16][30] - The company aims to achieve double-digit revenue growth and adjusted EBITDA margin by 2028 or sooner [36] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's trajectory despite market uncertainties and geopolitical turbulence [20][36] - The company expects to see sequential growth in M and T revenue in Q4 2025, driven by improved gross retention and new bookings [6][19] - Management highlighted the importance of customer consolidation and the maturity of newer products in driving future growth [20][36] Other Important Information - The company closed its first three AI deals in Q2 2025, indicating a strong sales pipeline with over 100 qualified opportunities [8][9] - The company received multiple industry awards, including recognition as a leader in AI-enabled enterprise video platforms [14][15] Q&A Session Summary Question: What is working well in your incremental new bookings momentum? - Management noted that the maturity of their events offering, customer consolidation, and the introduction of AI products are contributing to increased bookings [40][41] Question: Why do you think churn was elevated and what are you doing to address it? - Management explained that elevated churn in M and T was due to industry shifts towards IP and cloud, but they expect improvements with major customers like Vodafone [44][45] Question: How are your new AI products integrated into your selling motion and pricing? - The AI products are currently offered as upsells, with flexible pricing based on usage and integration into existing offerings [54][56] Question: Can you discuss the bookings mix in terms of new logos versus sales back into the base? - Management indicated that while upsells have been strong, they are seeing an increase in new logos, with a growing pipeline of potential new customers [72][74]

[Forward-Looking Statements](index=4&type=section&id=Forward-Looking%20Statements) Forward-looking statements are subject to risks including volatile economic climate, political/military conditions, customer dependency, profitability, evolving markets, technological competition, AI/GenAI, and data privacy concerns - Forward-looking statements are subject to risks including **volatile economic climate**, **political/military conditions in Israel/Ukraine**, **customer dependency**, inability to achieve profitability, evolving markets, technological competition, **AI/GenAI risks**, and **data privacy concerns**[12](index=12&type=chunk)[13](index=13&type=chunk)[18](index=18&type=chunk) [PART I FINANCIAL INFORMATION](index=7&type=section&id=PART%20I%20FINANCIAL%20INFORMATION) [Item 1. Consolidated Financial Statements (unaudited)](index=7&type=section&id=Item%201.%20Consolidated%20Financial%20Statements%20(unaudited)) Kaltura, Inc.'s unaudited condensed consolidated financial statements for Q2 and H1 2025 are presented, prepared under U.S. GAAP and SEC interim rules - The financial statements are unaudited and prepared under U.S. GAAP for interim reporting, with results for Q2 and H1 2025 not necessarily indicative of full-year performance[41](index=41&type=chunk)[43](index=43&type=chunk) - The Company operates in two main segments: **Enterprise, Education, and Technology (EE&T)** and **Media and Telecom (M&T)**, offering SaaS and PaaS video solutions[40](index=40&type=chunk)[89](index=89&type=chunk) - A cost-reduction and reorganization plan was approved on August 4, 2025, involving a **10% workforce reduction**, expected to incur **$687 thousand in pre-tax charges in Q3 2025** and result in **$8.5 million in annualized cost savings**[118](index=118&type=chunk)[255](index=255&type=chunk) [Condensed Consolidated Balance Sheets](index=7&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Condensed Consolidated Balance Sheets (in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :-------------------- | :------------ | :---------------- | | Total Assets | $169,447 | $181,305 | | Total Liabilities | $152,493 | $156,918 | | Total Stockholders' Equity | $16,954 | $24,387 | [Condensed Consolidated Statements of Operations](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Condensed Consolidated Statements of Operations (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Total revenue | $44,462 | $44,032 | $91,446 | $88,813 | | Gross profit | $31,219 | $28,676 | $63,955 | $57,284 | | Operating loss | $(2,757) | $(8,550) | $(4,334) | $(15,840) | | Net loss | $(7,750) | $(10,004) | $(8,869) | $(21,100) | | Net loss per share, basic and diluted | $0.05 | $0.07 | $0.06 | $0.14 | [Condensed Consolidated Statements of Comprehensive Loss](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Loss) Condensed Consolidated Statements of Comprehensive Loss (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net loss | $(7,750) | $(10,004) | $(8,869) | $(21,100) | | Other comprehensive income (losses) | $3,859 | $(685) | $2,947 | $(1,430) | | Comprehensive loss | $(3,891) | $(10,689) | $(5,922) | $(22,530) | [Condensed Consolidated Statement of Stockholders' Equity](index=11&type=section&id=Condensed%20Consolidated%20Statement%20of%20Stockholders'%20Equity) - Total stockholders' equity decreased from **$24,387 thousand** as of January 1, 2025, to **$16,954 thousand** as of June 30, 2025, primarily due to **net loss ($8,869 thousand)** and **common stock repurchases ($9,595 thousand)**, partially offset by **stock-based compensation ($8,447 thousand)** and **other comprehensive income ($2,947 thousand)**[33](index=33&type=chunk) [Condensed Consolidated Statement of Cash Flows](index=13&type=section&id=Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) Condensed Consolidated Statements of Cash Flows (in thousands) | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------ | :----------------------------- | :----------------------------- | | Net cash provided by (used in) operating activities | $1,610 | $(2,751) | | Net cash provided by investing activities | $11,625 | $1,763 | | Net cash used in financing activities | $(11,335) | $(1,296) | | Net increase (decrease) in cash, cash equivalents and restricted cash | $2,387 | $(2,416) | | Cash, cash equivalents and restricted cash at end of period | $35,546 | $34,368 | [Notes to Condensed Consolidated Interim Financial Statements](index=15&type=section&id=Notes%20to%20Condensed%20Consolidated%20Interim%20Financial%20Statements) [NOTE 1: General](index=15&type=section&id=NOTE%201%3A%20General) - Kaltura, Inc. was incorporated in October 2006 and operates in two main segments: **Enterprise, Education, and Technology (EE&T)** and **Media and Telecom (M&T)**, providing a platform for video creation, management, and collaboration through SaaS and PaaS offerings[40](index=40&type=chunk) [NOTE 2: Basis of Presentation and Summary of Significant Accounting Policies](index=15&type=section&id=NOTE%202%3A%20Basis%20of%20Presentation%20and%20Summary%20of%20Significant%20Accounting%20Policies) - The unaudited condensed consolidated financial statements are prepared in accordance with **U.S. GAAP** and **SEC interim reporting rules**, with certain disclosures condensed or omitted compared to annual reports[41](index=41&type=chunk)[42](index=42&type=chunk) - The Company, as an "emerging growth company," has elected to use the **extended transition period** for new accounting pronouncements[50](index=50&type=chunk) - New ASUs on income tax disclosures (**ASU 2023-09**, effective after Dec 15, 2024) and expense disaggregation (**ASU 2024-03**, effective after Dec 15, 2026) are being evaluated for impact[51](index=51&type=chunk)[52](index=52&type=chunk) [NOTE 3: Revenues from Contracts with Customers](index=17&type=section&id=NOTE%203%3A%20Revenues%20from%20Contracts%20with%20Customers) Disaggregated Revenue by Segment (in thousands) | Segment | Q2 2025 Revenue | Q2 2024 Revenue | H1 2025 Revenue | H1 2024 Revenue | | :------ | :-------------- | :-------------- | :-------------- | :-------------- | | EE&T | $33,242 | $30,965 | $67,658 | $63,405 | | M&T | $11,220 | $13,067 | $23,788 | $25,408 | | Total | $44,462 | $44,032 | $91,446 | $88,813 | Disaggregated Revenue by Region (in thousands) | Region | Q2 2025 Revenue | Q2 2024 Revenue | H1 2025 Revenue | H1 2024 Revenue | | :----- | :-------------- | :-------------- | :-------------- | :-------------- | | US | $24,182 | $23,547 | $48,372 | $46,737 | | EMEA | $16,987 | $16,884 | $35,755 | $34,404 | | Other | $3,293 | $3,601 | $7,319 | $7,672 | | Total | $44,462 | $44,032 | $91,446 | $88,813 | - Remaining performance obligations totaled **$188.1 million** as of June 30, 2025, with **61% expected to be recognized as revenue over the next 12 months**[56](index=56&type=chunk) [NOTE 4: Marketable Securities](index=19&type=section&id=NOTE%204%3A%20Marketable%20Securities) Available-for-Sale Marketable Securities (in thousands) | Category | June 30, 2025 Fair Value | December 31, 2024 Fair Value | | :------- | :----------------------- | :--------------------------- | | Current | $35,756 | $48,275 | | Long-term | $4,132 | $3,379 | | Total | $39,888 | $51,654 | [NOTE 5: Fair Value Measurements](index=21&type=section&id=NOTE%205%3A%20Fair%20Value%20Measurements) - Cash equivalents and marketable securities are measured at fair value using the **market approach (Level 1 or Level 2 inputs)**, while foreign currency derivative contracts are classified as **Level 2**[64](index=64&type=chunk) Fair Value of Assets (in thousands) | Asset Category | June 30, 2025 | December 31, 2024 | | :------------- | :------------ | :---------------- | | Money market funds | $21,719 | $12,212 | | Short-term marketable securities | $35,091 | $48,275 | | Long-term marketable securities | $4,132 | $3,379 | | Restricted bank deposits (current) | $3,507 | $3,507 | | Options and forward contracts (hedging) | $3,884 | $960 | | Restricted bank deposit (noncurrent) | $1,103 | $1,020 | [NOTE 6: Derivatives and Hedging](index=22&type=section&id=NOTE%206%3A%20Derivatives%20and%20Hedging) - The Company uses forward contracts to hedge forecasted payroll costs denominated in NIS against USD exchange rate fluctuations, with outstanding notional amounts of **$38.5 million** as of June 30, 2025[67](index=67&type=chunk)[68](index=68&type=chunk) - Gains from hedging instruments reclassified from accumulated other comprehensive income were **$817 thousand for Q2 2025** and **$1,143 thousand for H1 2025**[68](index=68&type=chunk) [NOTE 7: Leases](index=23&type=section&id=NOTE%207%3A%20Leases) - The Company leases office facilities with agreements expiring through November 2027, with an estimated lease term extending to **November 2032** due to a probable extension option[71](index=71&type=chunk) Operating Lease Costs (in thousands) | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :----- | :------ | :------ | :------ | :------ | | Total Operating Lease Cost | $754 | $721 | $1,716 | $1,439 | - As of June 30, 2025, total operating lease liabilities were **$17.8 million**, with a weighted-average remaining term of **6.90 years** and a weighted-average discount rate of **4.71%**[72](index=72&type=chunk)[73](index=73&type=chunk) [NOTE 8: Commitments and Contingencies](index=24&type=section&id=NOTE%208%3A%20Commitments%20and%20Contingencies) Future Non-Cancelable Purchase Commitments (in thousands) | Year Ending December 31, | Amount | | :----------------------- | :----- | | 2025 (Remainder) | $16,056 | | 2026 | $29,177 | | Total | $45,233 | - The Company is occasionally involved in legal proceedings but does not believe any pending litigation will have a **material adverse effect** on its business[76](index=76&type=chunk) [NOTE 9: Condensed Consolidated Balance Sheet Components](index=24&type=section&id=NOTE%209%3A%20Condensed%20Consolidated%20Balance%20Sheet%20Components) Prepaid Expenses and Other Current Assets (in thousands) | Component | June 30, 2025 | December 31, 2024 | | :-------- | :------------ | :---------------- | | Prepaid expenses | $3,984 | $4,085 | | Derivative instrument | $3,884 | $960 | | Restricted bank deposits | $3,507 | $3,507 | | Other current assets | $931 | $929 | | Total | $12,306 | $9,481 | Property and Equipment, Net (in thousands) | Component | June 30, 2025 | December 31, 2024 | | :-------- | :------------ | :---------------- | | Cost | $25,118 | $24,873 | | Accumulated depreciation | $(10,839) | $(8,683) | | Depreciated cost | $14,279 | $16,190 | - Depreciation expenses for H1 2025 were **$2,156 thousand**, down from **$2,343 thousand** in H1 2024[78](index=78&type=chunk) [NOTE 10: Goodwill and Intangible Assets](index=26&type=section&id=NOTE%2010%3A%20Goodwill%20and%20Intangible%20Assets) - Goodwill remained unchanged at **$11.1 million**[21](index=21&type=chunk)[81](index=81&type=chunk) Intangible Assets, Net (in thousands) | Category | June 30, 2025 | December 31, 2024 | | :------- | :------------ | :---------------- | | Technology | $0 | $97 | | Customer relationship | $89 | $115 | | Total | $89 | $212 | - Estimated future amortization expense for intangible assets is **$27 thousand for the remainder of 2025**, **$50 thousand for 2026**, and **$12 thousand for 2027**[82](index=82&type=chunk) [NOTE 11: Income Taxes](index=27&type=section&id=NOTE%2011%3A%20Income%20Taxes) Income Tax Expense (in thousands) | Period | Income Tax Expense | Effective Tax Rate | | :----- | :----------------- | :----------------- | | Q2 2025 | $424 | (8)% | | Q2 2024 | $2,464 | (33)% | | H1 2025 | $1,769 | (36)% | | H1 2024 | $4,772 | (29)% | - The effective tax rates differ from the U.S. statutory rate primarily due to **U.S. losses with no benefit** and **tax rate differences in foreign countries**; the Company has a **full valuation allowance** on its net deferred tax assets[83](index=83&type=chunk)[84](index=84&type=chunk) [NOTE 12: Net Loss Per Share Attributable to Common Stockholders](index=27&type=section&id=NOTE%2012%3A%20Net%20Loss%20Per%20Share%20Attributable%20to%20Common%20Stockholders) Net Loss Per Share (Basic and Diluted) | Period | Net Loss Per Share | Weighted-Average Shares Outstanding | | :----- | :----------------- | :---------------------------------- | | Q2 2025 | $0.05 | 153,536,740 | | Q2 2024 | $0.07 | 147,607,504 | | H1 2025 | $0.06 | 153,771,875 | | H1 2024 | $0.14 | 145,939,847 | - As of June 30, 2025, **28,870,136 outstanding stock options and RSUs** were excluded from diluted EPS calculation as their inclusion would have been anti-dilutive[87](index=87&type=chunk) [NOTE 13: Reportable Segments and Geographical Information](index=28&type=section&id=NOTE%2013%3A%20Reportable%20Segments%20and%20Geographical%20Information) - The Company operates in two segments: **Enterprise, Education and Technology (EE&T)** and **Media and Telecom (M&T)**, with EE&T representing **75% of Q2 2025 revenue** and M&T **25%**[170](index=170&type=chunk) Segment Revenue and Gross Profit (Q2 2025, in thousands) | Segment | Revenue | Cost of Revenue | Gross Profit | | :------ | :------ | :-------------- | :----------- | | EE&T | $33,242 | $7,375 | $25,867 | | M&T | $11,220 | $5,868 | $5,352 | | Total | $44,462 | $13,243 | $31,219 | Segment Revenue and Gross Profit (H1 2025, in thousands) | Segment | Revenue | Cost of Revenue | Gross Profit | | :------ | :------ | :-------------- | :----------- | | EE&T | $67,658 | $15,223 | $52,435 | | M&T | $23,788 | $12,268 | $11,520 | | Total | $91,446 | $27,491 | $63,955 | [NOTE 14: Long-Term Loan](index=32&type=section&id=NOTE%2014%3A%20Long-Term%20Loan) - The Company has a Credit Agreement with a Term Loan Facility and a Revolving Credit Facility, which has been amended multiple times, most recently in **March 2025**, to increase permitted Restricted Payments[100](index=100&type=chunk)[102](index=102&type=chunk) - As of June 30, 2025, the Term Loan Facility had an outstanding balance of approximately **$31.0 million**, with an interest rate of **6.90% per annum**[103](index=103&type=chunk)[222](index=222&type=chunk) - The Company was in compliance with all loan covenants as of June 30, 2025[105](index=105&type=chunk) [NOTE 15: Stockholders' Equity and Equity Incentive Plans](index=34&type=section&id=NOTE%2015%3A%20Stockholders'%20Equity%20and%20Equity%20Incentive%20Plans) - The number of shares authorized under the **2021 Incentive Award Plan** increased by **7,602,857 shares** on January 1, 2025[107](index=107&type=chunk) - Total unrecognized stock-based compensation cost was **$28.1 million** as of June 30, 2025, expected to be recognized over approximately **two years**[110](index=110&type=chunk) - A new **$15.0 million stock repurchase program (2025 Repurchase Program)** was approved in March 2025, superseding the 2024 program; during Q2 2025, **3,468,731 shares** were repurchased for **$2.07 per share**, with **$6.9 million remaining authorization**[112](index=112&type=chunk)[113](index=113&type=chunk) [NOTE 16: Selected Statements of Operations Data](index=36&type=section&id=NOTE%2016%3A%20Selected%20Statements%20of%20Operations%20Data) Financial Expense (Income), Net (in thousands) | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :----- | :------ | :------ | :------ | :------ | | Financial income | $737 | $1,858 | $1,632 | $1,608 | | Financial expenses | $5,306 | $848 | $4,398 | $2,096 | | Financial expense (income), net | $4,569 | $(1,010) | $2,766 | $488 | [NOTE 17: Accumulated Other Comprehensive Income](index=36&type=section&id=NOTE%2017%3A%20Accumulated%20Other%20Comprehensive%20Income) Changes in Accumulated Other Comprehensive Income (Loss) (H1 2025, in thousands) | Component | Balance Dec 31, 2024 | Other Comprehensive Income (Loss) before reclassifications | Net realized losses reclassified | Balance June 30, 2025 | | :-------- | :------------------- | :--------------------------------------------------------- | :------------------------------- | :-------------------- | | Net Unrealized Gains (Losses) on Available-for-Sale Securities | $23 | $(1) | $0 | $22 | | Net Unrealized Gains (Losses) on Derivatives Designated as Hedging Instruments | $936 | $4,091 | $(1,143) | $3,884 | | Total | $959 | $4,090 | $(1,143) | $3,906 | [NOTE 18: Subsequent Events](index=37&type=section&id=NOTE%2018%3A%20Subsequent%20Events) - On August 4, 2025, the Board approved a cost-reduction and reorganization plan, including a **10% workforce reduction**, expected to incur **$687 thousand in pre-tax charges in Q3 2025**[118](index=118&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=38&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management's discussion and analysis covers Kaltura's financial condition and operational results, focusing on performance drivers, financial metrics, and liquidity - Kaltura is a market-leading provider of **AI-infused video offerings** for enterprises, focusing on enhancing customer and employee engagement[121](index=121&type=chunk) - The Company's **2025 Reorganization Plan**, approved in August 2025, includes a **10% workforce reduction** to increase efficiency and productivity, with expected annualized cost savings of **$8.5 million** and pre-tax charges of **$0.7 million in Q3 2025**[124](index=124&type=chunk) [Overview](index=38&type=section&id=Overview) - Kaltura provides live, real-time, and on-demand video offerings, leveraging **AI to create hyper-personalized video experiences** for organizations[121](index=121&type=chunk) - The company's Video Experience Cloud includes platforms for **Enterprise Video Content Management System** and **TV Content Management System**, powering various AI-infused video products[121](index=121&type=chunk) - Revenue is primarily generated from **SaaS subscriptions**, platform usage licenses, and associated professional services, targeting medium to large enterprises, educational institutions, technology providers, and media/telecom companies[123](index=123&type=chunk) [Key Factors Affecting Our Performance](index=40&type=section&id=Key%20Factors%20Affecting%20Our%20Performance) - Key performance drivers include expanding the platform with **Gen AI features**, acquiring new customers across verticals (direct sales, channel partnerships, self-serve for SMEs), and increasing revenue from existing customers through **cross-selling and upselling**[131](index=131&type=chunk)[132](index=132&type=chunk)[133](index=133&type=chunk) - The company plans continued investment in growth, expecting cost of revenue and operating expenses to fluctuate[134](index=134&type=chunk) [Key Financial and Operating Metrics](index=40&type=section&id=Key%20Financial%20and%20Operating%20Metrics) Key Financial and Operating Metrics (in thousands, except percentages) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :-------------------------- | :------------------------------- | :------------------------------- | | Annualized Recurring Revenue | $170,364 | $165,167 | | Net Dollar Retention Rate | 101% | 98% | | Remaining Performance Obligations | $188,124 | $177,751 | - Remaining Performance Obligations as of June 30, 2025, were **$188.1 million**, with **61% expected to be recognized as revenue over the next 12 months**[142](index=142&type=chunk)[143](index=143&type=chunk) [Non-GAAP Financial Measures](index=42&type=section&id=Non-GAAP%20Financial%20Measures) - EBITDA and Adjusted EBITDA are non-GAAP measures used to evaluate performance, excluding items like financial expenses, taxes, depreciation, amortization, stock-based compensation, war-related expenses, and strategic initiative costs[145](index=145&type=chunk) EBITDA and Adjusted EBITDA Reconciliation (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net loss | $(7,750) | $(10,004) | $(8,869) | $(21,100) | | EBITDA | $(1,663) | $(7,271) | $(2,055) | $(13,255) | | Adjusted EBITDA | $4,060 | $1,632 | $8,201 | $2,196 | [Components of Our Results of Operation](index=44&type=section&id=Components%20of%20Our%20Results%20of%20Operation) - Revenue is primarily from **SaaS and PaaS subscriptions**, recognized ratably, with professional services revenue recognized upon rendering or ratably if considered setup activities[150](index=150&type=chunk)[151](index=151&type=chunk)[152](index=152&type=chunk) - Gross margins improved year-over-year, with **Q2 2025 at 70%** (**77% for subscriptions**, (73)% for professional services) compared to **Q2 2024 at 65%** (**74% for subscriptions**, (49)% for professional services)[158](index=158&type=chunk) - M&T segment gross margins are lower than EE&T due to **higher implementation costs** and a greater proportion of **private cloud/on-premise deployments**[157](index=157&type=chunk) [Results of Operations](index=47&type=section&id=Results%20of%20Operations) Consolidated Results of Operations (in thousands, except percentages) | Metric | Q2 2025 | Q2 2024 | Q2 YoY Change (%) | H1 2025 | H1 2024 | H1 YoY Change (%) | | :-------------------------- | :------ | :------ | :---------------- | :------ | :------ | :---------------- | | Total Revenue | $44,462 | $44,032 | 1% | $91,446 | $88,813 | 3% | | Total Gross Profit | $31,219 | $28,676 | 9% | $63,955 | $57,284 | 12% | | Total Operating Expenses | $33,976 | $37,226 | -9% | $68,289 | $73,124 | -7% | | Operating Loss | $(2,757) | $(8,550) | -68% | $(4,334) | $(15,840) | -73% | | Financial expense (income), net | $4,569 | $(1,010) | -552% | $2,766 | $488 | 467% | | Net Loss | $(7,750) | $(10,004) | -23% | $(8,869) | $(21,100) | -58% | - EE&T revenue increased by **7% for both Q2 and H1 2025**, driven by new and existing customers, while M&T revenue decreased by **14% in Q2** and **6% in H1 2025** due to existing customer decline[172](index=172&type=chunk)[178](index=178&type=chunk)[189](index=189&type=chunk)[195](index=195&type=chunk) - Operating expenses decreased across R&D, Sales & Marketing, and G&A for both Q2 and H1 2025, primarily due to **lower compensation costs** (including stock-based compensation) and **reduced subcontractor use**[183](index=183&type=chunk)[184](index=184&type=chunk)[185](index=185&type=chunk)[199](index=199&type=chunk)[200](index=200&type=chunk)[202](index=202&type=chunk) - Financial expense (income), net shifted from income to expense, increasing by **$5.6 million in Q2 2025** and **$2.3 million in H1 2025**, primarily due to **exchange rate differences**[186](index=186&type=chunk)[203](index=203&type=chunk) [Liquidity and Capital Resources](index=55&type=section&id=Liquidity%20and%20Capital%20Resources) - The Company's liquidity is primarily from operating activities, **cash on hand ($35.5 million as of June 30, 2025)**, and a **$25.0 million Revolving Credit Facility with no outstanding balance**[205](index=205&type=chunk)[222](index=222&type=chunk)[223](index=223&type=chunk) - Net cash provided by operating activities improved significantly to **$1.6 million in H1 2025** from **$(2.8) million in H1 2024**[223](index=223&type=chunk)[224](index=224&type=chunk) - Net cash used in financing activities increased to **$(11.3) million in H1 2025**, primarily due to **$9.6 million in common stock repurchases** and **$3.1 million in cash settlement of equity awards**[223](index=223&type=chunk)[231](index=231&type=chunk) [Critical Accounting Policies and Estimates](index=60&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) - The preparation of financial statements requires management to make estimates and judgments, which are believed to be reasonable, and there have been no significant changes to these policies during H1 2025[234](index=234&type=chunk)[235](index=235&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=60&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section discusses the Company's exposure to market risks, including foreign currency, interest rate, and inflation, and the strategies for their management - The Company is exposed to **foreign currency exchange risk**, primarily from NIS and Euro-denominated expenses and revenues, and uses hedging programs to mitigate this risk[237](index=237&type=chunk)[238](index=238&type=chunk) - A hypothetical **10% change in foreign currency exchange rates** would impact H1 2025 results by **$0.8 million due to NIS** (after hedges) and **$2.6 million due to Euros**[239](index=239&type=chunk) - With **$31.0 million in floating rate debt**, a hypothetical **10% change in interest rates** would impact H1 2025 interest expense by **$0.1 million**[240](index=240&type=chunk) [Item 4. Controls and Procedures](index=61&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, evaluated the Company's disclosure controls and procedures as of June 30, 2025, and concluded they were effective at a reasonable assurance level - Disclosure controls and procedures were evaluated and deemed **effective at the reasonable assurance level** as of June 30, 2025[244](index=244&type=chunk) - No material changes in internal control over financial reporting occurred during the period[245](index=245&type=chunk) [PART II OTHER INFORMATION](index=61&type=section&id=PART%20II%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=61&type=section&id=Item%201.%20Legal%20Proceedings) The Company is involved in various legal proceedings, but none are expected to have a material adverse effect on its financial condition or operations - The Company is not currently a party to any legal proceedings expected to have a **material adverse effect** on its business, operating results, cash flows, or financial condition[247](index=247&type=chunk) [Item 1A. Risk Factors](index=62&type=section&id=Item%201A.%20Risk%20Factors) This section updates risk factors, highlighting new risks from the 2025 Reorganization Plan, such as unrealized cost savings, operational disruption, personnel attrition, and management distraction - New risk factors include the potential for the **2025 Reorganization Plan** to not fully achieve expected cost savings or benefits, incur higher-than-forecasted costs, lead to employee attrition or reduced morale, and divert management's focus[249](index=249&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=62&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section details the Company's common stock repurchases during Q2 2025 under the 2025 Repurchase Program, confirming no material change in IPO proceeds use Common Stock Repurchases (Q2 2025) | Period | Shares Purchased | Average Price Per Share | | :----- | :--------------- | :---------------------- | | April | 1,505,827 | $1.93 | | May | 1,135,743 | $2.20 | | June | 827,161 | $2.14 | | Total | 3,468,731 | $2.07 | - The **2025 Repurchase Program**, approved in March 2025, authorizes repurchases up to **$15.0 million**, with approximately **$6.9 million remaining** as of June 30, 2025[251](index=251&type=chunk) [Item 3. Defaults Upon Senior Securities](index=63&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This section states that there were no defaults upon senior securities during the reported period - No defaults upon senior securities were reported[253](index=253&type=chunk) [Item 4. Mine Safety Disclosures](index=63&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This section indicates that mine safety disclosures are not applicable to the Company - Not applicable[254](index=254&type=chunk) [Item 5. Other Information](index=63&type=section&id=Item%205.%20Other%20Information) The 2025 Reorganization Plan's approval, 10% workforce reduction, and financial impacts are reiterated, with no Rule 10b5-1 trading arrangements noted for directors or officers - The **2025 Reorganization Plan**, approved August 4, 2025, involves a **10% workforce reduction**, aiming for **$8.5 million in annualized cost savings** and incurring **$0.7 million in pre-tax charges in Q3 2025**[255](index=255&type=chunk) - No **Rule 10b5-1 trading arrangements** were adopted or terminated by directors or officers during Q2 2025[256](index=256&type=chunk) [Item 6. Exhibits](index=64&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Quarterly Report on Form 10-Q, such as organizational documents, incentive plans, certifications, and XBRL documents - The report includes various exhibits such as the **Amended and Restated Certificate of Incorporation**, **Bylaws**, **Kaltura Severance Plan**, CEO/CFO certifications, and **Inline XBRL documents**[258](index=258&type=chunk)[259](index=259&type=chunk) [Signatures](index=66&type=section&id=Signatures) This section contains the signatures of Ron Yekutiel (Chairman, President, and CEO) and John Doherty (CFO), certifying the report's filing on August 7, 2025 - The report was signed by **Ron Yekutiel** (Chairman, President, and CEO) and **John Doherty** (CFO) on **August 7, 2025**[265](index=265&type=chunk)

[Executive Summary](index=1&type=section&id=executive-summary) Kaltura reported strong Q2 2025 results, exceeding guidance with record non-GAAP net profit and adjusted EBITDA, while initiating a reorganization to boost efficiency and target long-term growth [Q2 2025 Performance Overview](index=1&type=section&id=q2-2025-performance-overview) Kaltura announced strong financial results for Q2 2025, exceeding all guidance ranges with record non-GAAP net profit, matching last quarter's record adjusted EBITDA, and achieving the strongest second-quarter operating cash flow since 2020 - Exceeded all second quarter guidance ranges[3](index=3&type=chunk) - Delivered **record non-GAAP net profit**[3](index=3&type=chunk) - **Adjusted EBITDA profit** matched last quarter's **record high**[3](index=3&type=chunk) - Achieved **strongest second-quarter operating cash flow** since 2020[3](index=3&type=chunk) [CEO Commentary & Strategic Outlook](index=1&type=section&id=ceo-commentary-strategic-outlook) CEO Ron Yekutiel highlighted sequential growth in new bookings, including initial sales of AI products, and a robust pipeline for the second half of 2025. He also announced a reorganization plan with a 10% workforce reduction to boost efficiency, aiming to double adjusted EBITDA by 2026 and return to being a 'Rule of 30' company by or before 2028 - **New bookings increased sequentially** and included **initial sales of AI products**[3](index=3&type=chunk) - **Robust pipeline** for the second half of the year, projecting **growth in new bookings**[3](index=3&type=chunk) - Initiated a reorganization plan including a **workforce reduction of approximately 10%** to boost efficiency and productivity[3](index=3&type=chunk) - Long-term strategy to **double adjusted EBITDA in 2026** and return to being a '**Rule of 30**' company by or before 2028 through **double-digit revenue growth** and **improved adjusted EBITDA margin**[3](index=3&type=chunk) [Q2 2025 Financial Highlights](index=1&type=section&id=q2-2025-financial-highlights) Kaltura reported a 1% increase in total revenue and a 3% increase in subscription revenue and ARR year-over-year for Q2 2025. GAAP gross margin improved to 70% from 65%, and non-GAAP gross margin to 70% from 66%. The company achieved non-GAAP operating profit of $3.0 million (vs. $0.5M in Q2 2024) and non-GAAP net profit of $2.5 million (vs. net loss of $2.1M in Q2 2024), alongside a significant increase in Adjusted EBITDA to $4.1 million. Net cash from operating activities turned positive Q2 2025 Financial Performance (YoY Comparison) | Metric | Q2 2025 | Q2 2024 | Change | | :-------------------------- | :---------- | :---------- | :----- | | Revenue | $44.5 million | $44.0 million | +1% | | Subscription Revenue | $42.4 million | $41.0 million | +3% | | Annualized Recurring Revenue (ARR) | $170.4 million | $165.2 million | +3% | | GAAP Gross profit | $31.2 million | $28.7 million | +8.7% | | GAAP Gross margin | 70% | 65% | +5 ppts | | Non-GAAP Gross profit | $31.3 million | $29.0 million | +7.9% | | Non-GAAP Gross margin | 70% | 66% | +4 ppts | | GAAP Operating loss | $2.8 million | $8.6 million | Improved | | Non-GAAP Operating profit | $3.0 million | $0.5 million | +500% | | GAAP Net loss | $7.8 million | $10.0 million | Improved | | GAAP Net loss per diluted share | $0.05 | $0.07 | Improved | | Non-GAAP Net profit | $2.5 million | ($2.1 million) | Turned profitable | | Non-GAAP Net profit per diluted share | $0.01 | ($0.01) | Turned profitable | | Adjusted EBITDA | $4.1 million | $1.6 million | +156% | | Net Cash Provided by Operating Activities | $2.7 million | ($1.6 million) | Turned positive | [Q2 2025 Business Highlights & Strategic Initiatives](index=2&type=section&id=q2-2025-business-highlights-strategic-initiatives) Kaltura achieved strong business momentum with new AI deals and improved customer retention, alongside a strategic reorganization to enhance productivity and realize significant cost savings [Business Momentum & AI Adoption](index=2&type=section&id=business-momentum-ai-adoption) Kaltura achieved significant business momentum in Q2 2025, closing 21 new six-figure deals and initiating its AI monetization journey with the first three AI-driven deals, building a pipeline of over 100 qualified AI opportunities - Closed **21 new six-figure deals** across diverse industries[8](index=8&type=chunk) - Signed **first three AI-driven deals** featuring Content Lab and Genie[8](index=8&type=chunk) - AI sales pipeline now includes **over 100 qualified opportunities**[8](index=8&type=chunk) [Customer Retention & Industry Recognition](index=2&type=section&id=customer-retention-industry-recognition) Kaltura demonstrated strong customer retention with a third consecutive quarter of YoY improvement in Net Dollar Retention (NDR) and continued industry recognition, including being named an IDC MarketScape Leader for AI-Enabled Enterprise Video Platforms and multiple awards for its products - Achieved a **third consecutive quarter of year-over-year improvement in Net Dollar Retention (NDR)**, and a **fourth consecutive quarter above 100%**[8](index=8&type=chunk) - Recognized as a **Leader by IDC** in their inaugural MarketScape for AI-Enabled Enterprise Video Platforms[8](index=8&type=chunk) - Class Genie awarded '**e-Learning Innovation of the Year**' at the 7th Annual EdTech Breakthrough Awards[8](index=8&type=chunk) - Virtual Events & Webinars platform earned **five Gold Awards** at the 2025 Eventex Awards[8](index=8&type=chunk) [Organizational Realignment & Financial Impact](index=2&type=section&id=organizational-realignment-financial-impact) Kaltura initiated a company-wide reorganization, including a 10% workforce reduction, to enhance productivity and streamline operations. This realignment is expected to generate $2.6 million in cost savings for the remainder of 2025 and $8.5 million annually, with a one-time charge of $0.7 million in Q3 2025 - **Initiated a company-wide reorganization** to enhance productivity, streamline operations, and capture synergies, including unifying engineering resources and consolidating Customer Experience and Sales[8](index=8&type=chunk) - The reorganization includes a **reduction of approximately 10% of the workforce**, primarily impacting engineering, professional services, and administrative spend[8](index=8&type=chunk) - **Expected cost savings from workforce reductions**: **$2.6 million** for the balance of 2025, and **$8.5 million** on an annualized basis[8](index=8&type=chunk) - Total **one-time charge** related to the reorganization expected to be **approximately $0.7 million** in Q3 2025[8](index=8&type=chunk) [Financial Outlook](index=2&type=section&id=financial-outlook) Kaltura provided financial guidance for Q3 and full year 2025, projecting continued revenue growth and increased Adjusted EBITDA, reflecting anticipated benefits from strategic initiatives [Q3 2025 Guidance](index=2&type=section&id=q3-2025-guidance) Kaltura provided financial guidance for the third quarter of 2025, projecting total revenue between $42.8 million and $43.6 million, with subscription revenue ranging from $40.8 million to $41.6 million, and Adjusted EBITDA between $1.5 million and $2.5 million Q3 2025 Financial Guidance | Metric | Range | | :---------------- | :-------------------------- | | Subscription Revenue | $40.8 million - $41.6 million | | Total Revenue | $42.8 million - $43.6 million | | Adjusted EBITDA | $1.5 million - $2.5 million | [Full Year 2025 Guidance](index=2&type=section&id=full-year-2025-guidance) For the full year ending December 31, 2025, Kaltura expects total revenue to be between $180.4 million and $182.4 million, with subscription revenue between $170.9 million and $172.9 million, and Adjusted EBITDA in the range of $14.5 million to $16.0 million Full Year 2025 Financial Guidance | Metric | Range | | :---------------- | :-------------------------- | | Subscription Revenue | $170.9 million - $172.9 million | | Total Revenue | $180.4 million - $182.4 million | | Adjusted EBITDA | $14.5 million - $16.0 million | [Company Information & Disclosures](index=3&type=section&id=company-information-disclosures) This section provides essential company information, including investor resources, a company overview, important forward-looking statements, and definitions of non-GAAP financial measures and key operating metrics [Investor Resources & Conference Call](index=3&type=section&id=investor-resources-conference-call) Kaltura provides an Investor Deck on its website and will host a conference call to discuss Q2 2025 results and outlook, with replay available online - **Second quarter and full year 2025 Investor Deck** available on www.investors.kaltura.com[9](index=9&type=chunk) - **Conference call scheduled for August 7, 2025, at 8:00 a.m. ET** to review Q2 2025 financial results and discuss financial outlook[10](index=10&type=chunk) [About Kaltura](index=3&type=section&id=about-kaltura) Kaltura is the Video Experience Cloud, dedicated to creating AI-infused, hyper-personalized video experiences to enhance customer and employee engagement. Its offerings include enterprise and TV content management and a range of Gen AI-infused video-first products for various applications - **Mission**: Create and power **AI-infused hyper-personalized video experiences** that boost customer and employee engagement and success[12](index=12&type=chunk) - **Products**: **AI Video Experience Cloud**, platform for enterprise and TV content management, and **Gen AI-infused video-first products** (e.g., Video Portals, Virtual Events, Virtual Classrooms)[12](index=12&type=chunk) - Engages **millions of end-users** for marketing, sales, education, communication, collaboration, entertainment, and monetization[12](index=12&type=chunk) [Forward-Looking Statements](index=3&type=section&id=forward-looking-statements) This section highlights that the press release contains forward-looking statements regarding future performance, strategy, and economic conditions, which are subject to various known and unknown risks and uncertainties that could cause actual results to differ materially - **Statements regarding future financial and operating performance**, business strategy, cost-saving initiatives, AI-driven technologies, profitability, and general economic conditions are considered **forward-looking**[13](index=13&type=chunk) - **Forward-looking statements** are based on current plans, estimates, and expectations and are **not a guarantee of future achievement**[14](index=14&type=chunk) - **Actual results may differ materially** due to factors such as the volatile economic climate, geopolitical conditions (Israel), customer retention, competition, technological developments, AI risks, cybersecurity, and data privacy[15](index=15&type=chunk) [Non-GAAP Financial Measures Explanation](index=4&type=section&id=non-gaap-financial-measures-explanation) Kaltura provides non-GAAP financial measures, including non-GAAP gross profit, operating profit, net income, and Adjusted EBITDA, to offer supplemental information useful for management and investors in evaluating core operating performance. These measures adjust GAAP figures for specific non-cash and non-recurring items, but are not a substitute for GAAP results - **Non-GAAP financial measures** (e.g., gross profit, operating profit/loss, net income/loss, Adjusted EBITDA) are provided as **supplemental information to GAAP**[16](index=16&type=chunk) - **Adjustments** include stock-based compensation, amortization of acquired intangibles, strategic initiatives costs, war-related costs, and foreign currency translation adjustments[17](index=17&type=chunk) - **Non-GAAP Net Income was adjusted for foreign currency translation adjustments starting Q2 2025** for better reflection of overall operating performance[16](index=16&type=chunk) - These measures are **not defined by GAAP** and should **not be considered in isolation or as an alternative to GAAP measures**[18](index=18&type=chunk) [Key Financial and Operating Metrics Definitions](index=5&type=section&id=key-financial-operating-metrics-definitions) This section defines key operating metrics used by Kaltura: Annualized Recurring Revenue (ARR), Net Dollar Retention Rate (NDR), and Remaining Performance Obligations (RPO), explaining their calculation and purpose - **Annualized Recurring Revenue (ARR)** is calculated by annualizing recurring revenue from SaaS, PaaS, and On-Prem subscriptions for the most recently completed fiscal quarter[19](index=19&type=chunk) - **Net Dollar Retention Rate (NDR)** measures success in retaining and growing recurring revenue from existing customers by comparing recognized recurring revenue across comparable periods[20](index=20&type=chunk) - **Remaining Performance Obligations (RPO)** represents contracted future revenue not yet delivered, with **61% expected to be recognized as revenue over the next 12 months**[21](index=21&type=chunk) [Consolidated Financial Statements](index=6&type=section&id=consolidated-financial-statements) Kaltura's consolidated financial statements for Q2 2025 show improved profitability, positive operating cash flow, and shifts in asset composition, alongside detailed segment performance and reduced stock-based compensation [Consolidated Balance Sheets](index=6&type=section&id=consolidated-balance-sheets) As of June 30, 2025, Kaltura's total assets decreased to $169.4 million from $181.3 million at December 31, 2024, primarily due to a reduction in marketable securities. Total liabilities also decreased, while stockholders' equity saw a decline, mainly influenced by increased treasury stock and accumulated deficit Consolidated Balance Sheet Highlights (June 30, 2025 vs. Dec 31, 2024) | Metric | June 30, 2025 | Dec 31, 2024 | Change | | :-------------------------------- | :------------ | :------------ | :----- | | Total Assets | $169,447 | $181,305 | -6.5% | | Cash and cash equivalents | $35,446 | $33,059 | +7.2% | | Marketable securities (current) | $35,756 | $48,275 | -25.9% | | Total Current Assets | $114,419 | $121,558 | -5.9% | | Total Liabilities | $152,493 | $156,918 | -2.8% | | Total Stockholders' Equity | $16,954 | $24,387 | -30.5% | | Treasury stock | ($17,396) | ($7,801) | +123% (increase in negative value) | | Accumulated deficit | ($477,679) | ($468,810) | -1.9% (increase in negative value) | [Consolidated Statements of Operations](index=7&type=section&id=consolidated-statements-of-operations) For Q2 2025, total revenue increased 1% YoY to $44.5 million, driven by a 3% rise in subscription revenue. Gross profit increased to $31.2 million (70% margin) from $28.7 million (65% margin) in Q2 2024. Operating loss significantly narrowed to $2.8 million from $8.6 million, and net loss decreased to $7.8 million from $10.0 million YoY. For the six months ended June 30, 2025, total revenue grew 3% to $91.4 million, and net loss improved to $8.9 million from $21.1 million in the prior year period Q2 2025 Consolidated Statements of Operations (YoY Comparison) | Metric | Q2 2025 | Q2 2024 | Change | | :-------------------------- | :---------- | :---------- | :----- | | Total revenue | $44,462 | $44,032 | +1.0% | | Subscription revenue | $42,384 | $41,014 | +3.3% | | Professional services revenue | $2,078 | $3,018 | -31.1% | | Gross profit | $31,219 | $28,676 | +8.9% | | Gross margin | 70% | 65% | +5 ppts | | Operating loss | $2,757 | $8,550 | Improved | | Net loss | $7,750 | $10,004 | Improved | | Net loss per share (diluted) | $0.05 | $0.07 | Improved | Six Months Ended June 30, 2025 Consolidated Statements of Operations (YoY Comparison) | Metric | 6M 2025 | 6M 2024 | Change | | :-------------------------- | :---------- | :---------- | :----- | | Total revenue | $91,446 | $88,813 | +3.0% | | Net loss | $8,869 | $21,100 | Improved | | Net loss per share (diluted) | $0.06 | $0.14 | Improved | [Stock-based Compensation](index=8&type=section&id=stock-based-compensation) Stock-based compensation expenses decreased significantly across all categories for both the three and six months ended June 30, 2025, compared to the prior year periods, with total stock-based compensation for Q2 2025 down 54% YoY Stock-based Compensation (Q2 2025 vs. Q2 2024) | Category | Q2 2025 | Q2 2024 | Change | | :-------------------------- | :---------- | :---------- | :----- | | Cost of revenue | $119 | $263 | -54.7% | | Research and development | $760 | $1,158 | -34.4% | | Sales and marketing | $383 | $729 | -47.4% | | General and administrative | $2,829 | $6,752 | -58.1% | | **Total** | **$4,091** | **$8,902** | **-54.0%** | Stock-based Compensation (6M 2025 vs. 6M 2024) | Category | 6M 2025 | 6M 2024 | Change | | :-------------------------- | :---------- | :---------- | :----- | | Total | $8,624 | $15,429 | -44.1% | [Revenue by Segment](index=8&type=section&id=revenue-by-segment) In Q2 2025, the Enterprise, Education and Technology segment revenue increased by 7.4% YoY, while the Media and Telecom segment revenue decreased by 14.2% YoY. Similar trends were observed for the six-month period Revenue by Segment (Q2 2025 vs. Q2 2024) | Segment | Q2 2025 | Q2 2024 | Change | | :-------------------------------- | :---------- | :---------- | :----- | | Enterprise, Education and Technology | $33,242 | $30,965 | +7.4% | | Media and Telecom | $11,220 | $13,067 | -14.2% | | **Total** | **$44,462** | **$44,032** | **+1.0%** | Revenue by Segment (6M 2025 vs. 6M 2024) | Segment | 6M 2025 | 6M 2024 | Change | | :-------------------------------- | :---------- | :---------- | :----- | | Enterprise, Education and Technology | $67,658 | $63,405 | +6.7% | | Media and Telecom | $23,788 | $25,408 | -6.4% | | **Total** | **$91,446** | **$88,813** | **+3.0%** | [Gross Profit by Segment](index=8&type=section&id=gross-profit-by-segment) Gross profit for the Enterprise, Education and Technology segment increased by 12.8% YoY in Q2 2025, while the Media and Telecom segment's gross profit decreased by 6.8% YoY Gross Profit by Segment (Q2 2025 vs. Q2 2024) | Segment | Q2 2025 | Q2 2024 | Change | | :-------------------------------- | :---------- | :---------- | :----- | | Enterprise, Education and Technology | $25,867 | $22,932 | +12.8% | | Media and Telecom | $5,352 | $5,744 | -6.8% | | **Total** | **$31,219** | **$28,676** | **+8.9%** | Gross Profit by Segment (6M 2025 vs. 6M 2024) | Segment | 6M 2025 | 6M 2024 | Change | | :-------------------------------- | :---------- | :---------- | :----- | | Enterprise, Education and Technology | $52,435 | $46,488 | +12.8% | | Media and Telecom | $11,520 | $10,796 | +6.7% | | **Total** | **$63,955** | **$57,284** | **+11.6%** | [Consolidated Statement of Cash Flows](index=9&type=section&id=consolidated-statement-of-cash-flows) For the six months ended June 30, 2025, net cash provided by operating activities turned positive at $1.6 million, a significant improvement from the prior year's cash usage. Net cash from investing activities increased substantially, while net cash used in financing activities also increased due to common stock repurchases Cash Flow Highlights (Six Months Ended June 30, 2025 vs. 2024) | Metric | 6M 2025 | 6M 2024 | Change | | :-------------------------------- | :---------- | :---------- | :----- | | Net cash provided by (used in) operating activities | $1,610 | ($2,751) | Turned positive | | Net cash provided by investing activities | $11,625 | $1,763 | +559.4% | | Net cash used in financing activities | ($11,335) | ($1,296) | -774.6% (increased outflow) | | Net increase (decrease) in cash, cash equivalents and restricted cash | $2,387 | ($2,416) | Turned positive | | Cash, cash equivalents and restricted cash at end of period | $35,546 | $34,368 | +3.4% | - **Repurchase of common stock increased to $9.6 million** in 6M 2025 from **$0.085 million** in 6M 2024[27](index=27&type=chunk) [Non-GAAP Reconciliations & Adjusted EBITDA](index=10&type=section&id=non-gaap-reconciliations-adjusted-ebitda) This section details the reconciliation of GAAP to non-GAAP financial measures, highlighting significant improvements in non-GAAP gross profit, operating profit, net profit, and Adjusted EBITDA for Q2 2025 [Reconciliation from GAAP to Non-GAAP Results](index=11&type=section&id=reconciliation-from-gaap-to-non-gaap-results) This section provides detailed reconciliations of GAAP to non-GAAP financial measures for gross profit, operating expenses, operating income (loss), and net loss, showing significant improvements in non-GAAP profitability metrics for Q2 2025 compared to the prior year Q2 2025 GAAP to Non-GAAP Reconciliation Highlights | Metric | GAAP (Q2 2025) | Non-GAAP (Q2 2025) | GAAP (Q2 2024) | Non-GAAP (Q2 2024) | | :-------------------------- | :--------------- | :----------------- | :--------------- | :----------------- | | Gross profit | $31,219 | $31,338 | $28,676 | $29,045 | | Gross margin | 70% | 70% | 65% | 66% | | Operating loss (profit) | ($2,757) | $2,978 | ($8,550) | $472 | | Operating margin | (6)% | 7% | (19)% | 1% | | Net loss (profit) | ($7,750) | $2,449 | ($10,004) | ($2,050) | | Net earnings (loss) per share - diluted | $0.05 (loss) | $0.01 (profit) | $0.07 (loss) | $0.01 (loss) | - **Key adjustments for non-GAAP measures** include stock-based compensation, amortization of acquired intangibles, strategic initiatives, war-related costs, and foreign currency translation adjustments[29](index=29&type=chunk) [Adjusted EBITDA](index=12&type=section&id=adjusted-ebitda) Kaltura's Adjusted EBITDA for Q2 2025 significantly increased to $4.1 million from $1.6 million in Q2 2024, and for the six months ended June 30, 2025, it was $8.2 million, reflecting substantial year-over-year growth Adjusted EBITDA (Q2 2025 vs. Q2 2024) | Metric | Q2 2025 | Q2 2024 | Change | | :---------------- | :---------- | :---------- | :----- | | Adjusted EBITDA | $4,060 | $1,632 | +148.8% | Adjusted EBITDA (6M 2025 vs. 6M 2024) | Metric | 6M 2025 | 6M 2024 | Change | | :---------------- | :---------- | :---------- | :----- | | Adjusted EBITDA | $8,201 | $2,196 | +274.4% | - **Adjustments include non-cash stock-based compensation expense**, strategic initiatives, and war-related costs[30](index=30&type=chunk) [Reported Key Performance Indicators (KPIs)](index=13&type=section&id=reported-key-performance-indicators-kpis) As of June 30, 2025, Annualized Recurring Revenue (ARR) increased by 3.1% YoY to $170.4 million, and Remaining Performance Obligations (RPO) grew by 5.8% YoY to $188.1 million. The Net Dollar Retention Rate (NDR) improved to 101% in Q2 2025 from 98% in Q2 2024 Key Performance Indicators (as of/for Q2 2025 vs. Q2 2024) | Metric | June 30, 2025 | June 30, 2024 | Change | | :-------------------------- | :------------ | :------------ | :----- | | Annualized Recurring Revenue | $170,364 | $165,167 | +3.1% | | Remaining Performance Obligations | $188,124 | $177,751 | +5.8% | | Net Dollar Retention Rate (Q2) | 101% | 98% | +3 ppts |