Appian (APPN) 10-Q 2 May 24 2024 Q1 Quarterly report Financial data

Cover Page

Cover Page - shares	3 Months Ended
	Mar. 31, 2024	Apr. 29, 2024
Document and Entity Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2024
Document Transition Report	false
Entity File Number	001-38098
Entity Registrant Name	APPIAN CORPORATION
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	54-1956084
Entity Address, Address Line One	7950 Jones Branch Drive
Entity Address, City or Town	McLean
Entity Address, State or Province	VA
Entity Address, Postal Zip Code	22102
City Area Code	(703)
Local Phone Number	442-8844
Title of 12(b) Security	Class A Common Stock
Trading Symbol	APPN
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Central Index Key	0001441683
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q1
Amendment Flag	false
Class A Common Stock
Document and Entity Information [Line Items]
Entity Common Stock, Shares Outstanding		41,044,704
Class B Common Stock
Document and Entity Information [Line Items]
Entity Common Stock, Shares Outstanding		31,196,796

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Current assets
Cash and cash equivalents	$ 170,108	$ 149,351
Short-term investments and marketable securities	0	9,653
Accounts receivable, net of allowances of $2,265 and $2,606, respectively	129,317	171,561
Deferred commissions, current	34,367	34,261
Prepaid expenses and other current assets	56,088	49,529
Total current assets	389,880	414,355
Property and equipment, net of accumulated depreciation of $26,904 and $25,141, respectively	42,558	42,682
Goodwill	26,518	27,106
Intangible assets, net of accumulated amortization of $4,432 and $4,152, respectively	3,434	3,889
Right-of-use assets for operating leases	39,074	39,975
Deferred commissions, net of current portion	58,090	59,764
Deferred tax assets	3,833	3,453
Other assets	31,971	36,279
Total assets	595,358	627,503
Current liabilities
Accounts payable	9,882	6,174
Accrued expenses	12,252	11,046
Accrued compensation and related benefits	28,981	38,003
Deferred revenue	220,943	235,992
Debt	7,098	66,368
Operating lease liabilities	12,219	11,698
Other current liabilities	2,555	1,891
Total current liabilities	293,930	371,172
Long-term debt	248,025	140,221
Non-current operating lease liabilities	57,357	59,067
Deferred revenue, non-current	5,216	4,700
Deferred tax liabilities	2	2
Other non-current liabilities	493	0
Total liabilities	605,023	575,162
Stockholders’ (deficit) equity
Additional paid-in capital	603,870	595,781
Accumulated other comprehensive loss	(10,708)	(23,555)
Accumulated deficit	(552,815)	(519,892)
Treasury stock at cost, $1,320,531 shares as of March 31, 2024	(50,019)	0
Total stockholders’ (deficit) equity	(9,665)	52,341
Total liabilities and stockholders’ (deficit) equity	595,358	627,503
Class A Common Stock
Stockholders’ (deficit) equity
Common stock	4	4
Class B Common Stock
Stockholders’ (deficit) equity
Common stock	$ 3	$ 3

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Allowance for doubtful accounts	$ 2,265	$ 2,606
Accumulated depreciation	26,904	25,141
Finite-lived intangible assets, accumulated amortization	$ 4,432	$ 4,152
Treasury stock, shares (in shares)	1,320,531
Class A Common Stock
Common stock, par value (in usd per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized (in shares)	500,000,000
Common stock, shares issued (in shares)	42,359,967	42,169,970
Class B Common Stock
Common stock, par value (in usd per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized (in shares)	100,000,000
Common stock, shares issued (in shares)	31,196,796	31,196,796

CONSOLIDATED STATEMENTS OF OPER

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Revenue
Total revenue	$ 149,835	$ 135,235
Cost of revenue
Total cost of revenue	37,997	36,093
Gross profit	111,838	99,142
Operating expenses
Sales and marketing	58,156	63,090
Research and development	39,771	41,624
General and administrative	33,446	29,694
Total operating expenses	131,373	134,408
Operating loss	(19,535)	(35,266)
Other non-operating expense
Other expense (income), net	8,207	(2,690)
Interest expense	5,646	3,118
Total other non-operating expense	13,853	428
Loss before income taxes	(33,388)	(35,694)
Income tax (benefit) expense	(465)	1,135
Net loss	$ (32,923)	$ (36,829)
Net loss per share:
Basic (in usd per share)	$ (0.45)	$ (0.51)
Diluted (in usd per share)	$ (0.45)	$ (0.51)
Weighted average common shares outstanding:
Basic (in shares)	73,300	72,869
Diluted (in shares)	73,300	72,869
Subscriptions
Revenue
Total revenue	$ 117,694	$ 98,957
Cost of revenue
Total cost of revenue	12,270	10,448
Professional services
Revenue
Total revenue	32,141	36,278
Cost of revenue
Total cost of revenue	$ 25,727	$ 25,645

CONSOLIDATED STATEMENTS OF COMP

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Statement of Comprehensive Income [Abstract]
Net loss	$ (32,923)	$ (36,829)
Comprehensive loss, net of income taxes
Foreign currency translation adjustments	12,843	(746)
Unrealized gains on available-for-sale securities	4	46
Total other comprehensive loss, net of income taxes	$ (20,076)	$ (37,529)

CONSOLIDATED STATEMENTS OF CHAN

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' (DEFICIT) EQUITY - USD ($) $ in Thousands	Total	Common Stock	Additional Paid-In Capital	Accumulated Other Comprehensive Loss	Accumulated Deficit	Treasury Stock
Beginning balance (in shares) at Dec. 31, 2022		72,817,887
Beginning balance at Dec. 31, 2022	$ 145,700	$ 7	$ 561,390	$ (7,246)	$ (408,451)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(36,829)				(36,829)
Issuance of common stock to directors (in shares)		6,713
Vesting of restricted stock units (in shares)		111,296
Vesting of restricted stock units	(2,959)		(2,959)
Exercise of stock options (in shares)		19,483
Exercise of stock options	131		131
Stock-based compensation expense	11,056		11,056
Other comprehensive income (loss)	(700)			(700)
Ending balance (in shares) at Mar. 31, 2023		72,955,379
Ending balance at Mar. 31, 2023	116,399	$ 7	569,618	(7,946)	(445,280)
Beginning balance (in shares) at Dec. 31, 2023		73,366,766
Beginning balance at Dec. 31, 2023	52,341	$ 7	595,781	(23,555)	(519,892)	$ 0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(32,923)				(32,923)
Issuance of common stock to directors (in shares)		4,974
Vesting of restricted stock units (in shares)		141,563
Vesting of restricted stock units	(2,862)		(2,862)
Exercise of stock options (in shares)		43,460
Exercise of stock options	345		345
Repurchase of common stock (in shares)		(1,320,531)
Repurchase of common stock	(50,019)					(50,019)
Stock-based compensation expense	10,606		10,606
Other comprehensive income (loss)	$ 12,847			12,847
Ending balance (in shares) at Mar. 31, 2024	72,200,000	72,236,232
Ending balance at Mar. 31, 2024	$ (9,665)	$ 7	$ 603,870	$ (10,708)	$ (552,815)	$ (50,019)

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Cash flows from operating activities
Net loss	$ (32,923)	$ (36,829)
Adjustments to reconcile net loss to net cash provided by (used by) operating activities
Stock-based compensation	10,606	11,056
Depreciation expense and amortization of intangible assets	2,361	2,342
Bad debt expense	(135)	120
Amortization of debt issuance costs	140	70
(Benefit) provision for deferred income taxes	(450)	357
Foreign currency transaction losses, net	11,806	0
Changes in assets and liabilities
Accounts receivable	40,061	17,609
Prepaid expenses and other assets	(2,245)	(8,803)
Deferred commissions	1,569	(314)
Accounts payable and accrued expenses	5,187	(1,878)
Accrued compensation and related benefits	(8,703)	(9,369)
Other current and non-current liabilities	1,944	1,582
Deferred revenue	(10,120)	(2,177)
Operating lease assets and liabilities	(232)	969
Net cash provided by (used by) operating activities	18,866	(25,265)
Cash flows from investing activities
Proceeds from maturities of investments	9,657	16,289
Payments for investments	0	(24,184)
Purchases of property and equipment	(2,198)	(4,421)
Net cash provided by (used by) investing activities	7,459	(12,316)
Cash flows from financing activities
Proceeds from borrowings	50,000	92,000
Payments for debt issuance costs	(463)	(278)
Debt repayments	(1,250)	(750)
Repurchase of common stock	(50,019)	0
Payments for employee taxes related to the net share settlement of equity awards	(2,862)	(2,959)
Proceeds from exercise of common stock options	345	131
Net cash (used by) provided by financing activities	(4,249)	88,144
Effect of foreign exchange rate changes on cash, cash equivalents, and restricted cash	(1,319)	15
Net increase in cash, cash equivalents, and restricted cash	20,757	50,578
Cash, cash equivalents, and restricted cash at beginning of period	149,351	150,381
Cash, cash equivalents, and restricted cash at end of period	170,108	200,959
Supplemental disclosure of cash flow information
Cash paid for interest	5,325	1,233
Cash paid for income taxes	751	284
Supplemental disclosure of non-cash investing and financing activities
Accrued capital expenditures	$ 484	$ 2,233

Organization and Description of

Organization and Description of Business	3 Months Ended
	Mar. 31, 2024
Accounting Policies [Abstract]
Organization and Description of Business	1. Organization and Description of Business Appian Corporation (together with its subsidiaries, “Appian,” the “Company,” “we,” or “our”) is a software company that automates business processes. The Appian AI Process Platform includes everything you need to design, automate, and optimize even the most complex processes, from start to finish. The world's most innovative organizations trust Appian to improve their workflows, unify data, and optimize operations—resulting in better growth and superior customer experiences. We are headquartered in McLean, Virginia and operate both in the U.S. and internationally, including Australia, Canada, France, Germany, India, Italy, Japan, Mexico, the Netherlands, Portugal, Singapore, Spain, Sweden, Switzerland, and the United Kingdom.

Accounting Policies

Accounting Policies	3 Months Ended
	Mar. 31, 2024
Accounting Policies [Abstract]
Accounting Policies	2. Accounting Policies Basis of Presentation The accompanying unaudited condensed consolidated financial statements and footnotes include the accounts of Appian and its wholly-owned subsidiaries and have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) as contained in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) for interim financial reporting. In the opinion of management, the interim financial information includes all adjustments of a normal recurring nature necessary for a fair presentation of the results of operations, financial position, changes in stockholders’ equity, and cash flows. All intercompany accounts and transactions have been eliminated in consolidation. The results of operations for the current period are not necessarily indicative of the results for the full year or the results for any future periods. These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related footnotes included in our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the Securities and Exchange Commission (the “SEC”) on February 15, 2024. Use of Estimates The preparation of our condensed consolidated financial statements in conformity with U.S. GAAP requires us to make estimates and judgments that affect the amounts reported in these condensed consolidated financial statements and accompanying notes. Although we believe the estimates we use are reasonable, due to the inherent uncertainty involved in making these estimates, actual results reported in future periods could differ from those estimates. Significant estimates embedded in the condensed consolidated financial statements include, but are not limited to, revenue recognition, income taxes and the related valuation allowance established against deferred tax assets, the amortization period of deferred commissions, the amortization period of the cost to obtain the judgment preservation insurance (as discussed in Note 12), and stock-based compensation. Revenue Recognition Refer to Note 3 for a detailed discussion on specific revenue recognition principles related to our major revenue streams. Concentration of Credit and Customer Risk Our financial instruments exposed to concentration of credit and customer risk consist primarily of cash, cash equivalents, accounts receivable, and our short- and long-term investments. Deposits held with banks may exceed the amount of insurance provided on such deposits; however, we believe the financial institutions holding our cash deposits are financially sound and, accordingly, minimal credit risk exists with respect to these balances. With regard to our customers, credit evaluation and account monitoring procedures are used to minimize the risk of loss. Revenue generated from government agencies represented 21.7% and 20.5% of our revenue for the three months ended March 31, 2024 and 2023, respectively, of which the top three U.S. federal government agencies generated 4.5% and 4.2% of our revenue for the three months ended March 31, 2024 and 2023, respectively. Additionally, 37.2% and 33.4% of our revenue during the three months ended March 31, 2024 and 2023, respectively, was generated from international customers. No single end-customer accounted for more than 10% of our total revenue in the three months ended March 31, 2024 or 2023. As of March 31, 2024, we had one customer whose balance comprised 12% of total accounts receivable. Cash, Cash Equivalents, and Restricted Cash We consider all highly liquid investments with original maturities of three months or less, as well as overnight repurchase agreements, to be cash equivalents. Restricted cash consisted of cash designated to settle an escrow liability stemming from a holdback agreement related to our acquisition of Lana Labs GmbH. We paid the remaining amount owed on August 11, 2023. The following table presents a reconciliation of cash, cash equivalents, and restricted cash as presented in the consolidated statements of cash flows (in thousands): As of March 31, 2024 December 31, 2023 March 31, 2023 December 31, 2022 Cash and cash equivalents $ 170,108 $ 149,351 $ 198,679 $ 148,132 Restricted cash, current — — 2,280 2,249 Total cash, cash equivalents, and restricted cash $ 170,108 $ 149,351 $ 200,959 $ 150,381 Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are stated at realizable value, net of an allowance for doubtful accounts. The allowance for doubtful accounts is based on our assessment of the collectability of accounts and incorporates an estimation of expected lifetime credit losses on our receivables. We regularly review the composition of the accounts receivable aging, historical bad debts, changes in payment patterns, customer creditworthiness, and current economic trends. If the financial condition of our customers were to deteriorate, resulting in their inability to make required payments, additional provisions for doubtful accounts would be required and would increase bad debt expense. The allowance for doubtful accounts totaled $2.3 million and $2.6 million as of March 31, 2024 and December 31, 2023, respectively. Deferred Commissions We capitalize costs of obtaining a contract with a customer, which consist of sales commissions paid to our sales team, and the associated incremental payroll taxes. These costs are recorded as deferred commissions in the consolidated balance sheets. Costs to obtain a contract for a new customer or upsell an existing customer are amortized over an estimated economic life of five years as sales commissions on initial sales are not commensurate with sales commissions on contract renewals. Commissions paid relating to contract renewals are deferred and amortized over the related renewal period. We determine the estimated economic life based on both qualitative and quantitative factors such as expected renewals, product life cycles, contractual terms, and customer attrition. We periodically review the carrying amount of deferred contract acquisition costs to determine whether events or changes in circumstances have occurred that could impact the estimated economic life. Costs to obtain a contract for professional services arrangements are expensed as incurred as the contractual period of our professional services arrangements are one year or less. Amortization associated with deferred commissions is recorded to sales and marketing expense in our consolidated statements of operations. Total commission expense was $11.4 million and $11.0 million for the three months ended March 31, 2024 and 2023, respectively. Property and Equipment Property and equipment are stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. Significant additions or improvements extending the useful life of an asset are capitalized, while repairs and maintenance costs which do not significantly improve the related assets or extend their useful lives are charged to expense as incurred. The estimated useful lives of our property and equipment are generally 3 years for computer software, computer hardware, and internally developed software, 5 years for equipment, and 10 years years for office furniture and fixtures. Leasehold improvements have an estimated useful life of the shorter of the useful life of the assets or the lease term. Severance Costs In the past, we have incurred severance costs related to involuntary reductions in our workforce designed to right-size our employee base and improve operations. For involuntary termination benefits not provided under the terms of ongoing arrangements, we record severance costs once the terms of the arrangement have been established and communicated to employees. Costs related to benefits provided in accordance with mutually understood and ongoing agreements are recognized when an obligation has been incurred, it is probable the benefits will be paid, and the amount to be paid can be reasonably estimated. We did not incur any such severance costs during the three months ended March 31, 2024, while severance costs related to actions totaled $4.2 million for the three months ended March 31, 2023. Treasury Stock We account for treasury stock under the cost method. When treasury stock is reissued at a price higher than its cost, the difference is recorded as a component of additional paid-in-capital (“APIC”) in our consolidated balance sheets. When treasury stock is reissued at a price lower than its cost, the difference is recorded as a component of APIC to the extent there are previously recorded gains to offset the losses. If there are no treasury stock gains in APIC, the losses upon reissuance of treasury stock are recorded as an increase to accumulated deficit. Recent Accounting Pronouncements Adopted We have not adopted any new accounting guidance in 2024 that has had a material impact on our condensed consolidated financial statements or disclosures. Not Yet Adopted In November 2023, the FASB issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280): Improvement to Reportable Segment Disclosures (ASU 2023-07), which enhances the disclosure requirements for operating segments in our annual and interim consolidated financial statements. The new guidance is effective for us beginning with our annual reporting for fiscal year 2024 and for interim period reporting beginning in fiscal year 2025 and will be applied on a retrospective basis. Early adoption is permitted. The new ASU requires public companies to disclose significant segment expenses and other segment items on an annual and interim basis and provide in interim periods all disclosures about a reportable segment’s profit or loss and assets that are currently required annually. Additionally, it requires public companies to disclose the title and position of the Chief Operating Decision Maker (“CODM”). The ASU does not change how a public entity identifies its operating segments, aggregates them, or applies the quantitative thresholds to determine its reportable segments. This guidance also applies to public entities that have only one segment. This ASU will only impact our disclosures with no impacts to our results of operations, cash flows, and financial condition. In December 2023, the FASB issued ASU 2023-09, Income Tax (Topic 740): Improvement to Income Tax Disclosures (ASU 2023-09), which requires public companies to disclose, on an annual basis, a tabular rate reconciliation using both percentages and currency amounts, broken out into specified categories with certain reconciling items further broken out by nature and jurisdiction to the extent those items exceed a specified threshold. In addition, all entities are required to disclose income taxes paid, net of refunds received disaggregated by federal, state/local, and foreign and by jurisdiction if the amount is at least 5% of total income tax payments, net of refunds received. The new guidance will be effective for our annual reporting for fiscal year 2025 on a prospective basis with the option to apply the standard retrospectively. Early adoption is permitted. This ASU will only impact our disclosures with no impacts to our results of operations, cash flows, and financial condition. In March 2024, the SEC issued its final climate disclosure rule, which requires the disclosure of material Scope 1 and Scope 2 greenhouse gas emissions and other climate-related topics in annual reports if they are reasonably likely to have a material impact on the Company’s business. For large accelerated filers, disclosure requirements will begin phasing in for fiscal years beginning on or after January 1, 2025. Subsequent to issuance, the rules became the subject of litigation, and the SEC has issued a stay to allow the legal process to proceed. We are currently evaluating the impact these rules will have on our financial statements and related disclosures and will monitor the litigation progress for possible impacts on the disclosure requirements under the rules.

Revenue

Revenue	3 Months Ended
	Mar. 31, 2024
Revenue from Contract with Customer [Abstract]
Revenue	3. Revenue Revenue Recognition We generate subscriptions revenue primarily through the sale of cloud subscriptions bundled with maintenance and support and hosting services as well as term license subscriptions bundled with maintenance and support. We generate professional services revenue from fees for our consulting services, including application development and deployment assistance as well as training related to our platform. The following table summarizes revenue recorded during the three months ended March 31, 2024 and 2023 (in thousands): Three Months Ended March 31, 2024 2023 Cloud subscriptions $ 86,603 $ 69,692 Term license subscriptions 23,771 23,151 Maintenance and support 7,320 6,114 Total subscriptions 117,694 98,957 Professional services 32,141 36,278 Total revenue $ 149,835 $ 135,235 Performance Obligations and Timing of Revenue Recognition We primarily sell products and services that fall into the categories discussed below. Each category contains one or more performance obligations that are either (1) capable of being distinct (i.e., the customer can benefit from the product or service on its own or together with readily available resources, including those purchased separately from us) and distinct within the context of the contract (i.e., separately identified from other promises in the contract) or (2) a series of distinct products or services that are substantially the same and have the same pattern of transfer to the customer. Our term license subscriptions are delivered at a point in time while our cloud subscriptions, maintenance and support, and professional services are delivered over time. Subscriptions Revenue Subscriptions revenue is primarily related to (1) cloud subscriptions bundled with maintenance and support and hosting services and (2) term license subscriptions bundled with maintenance and support. We generally charge subscription fees on a per-user basis or through non-user based single application licenses. We bill customers and collect payment for subscriptions to our platform in advance on an annual, quarterly, or monthly basis. In certain instances, our customers have paid their entire contract up front. Cloud Subscriptions We generate cloud-based subscriptions revenue primarily from the sales of subscriptions to access our cloud offering, together with related support services to our customers. We perform all required maintenance and support for our cloud offering. Revenue is recognized on a ratable basis over the contract term beginning on the date the service is made available to the customer. Our cloud-based subscription contracts generally have a term of one Term License Subscriptions Our term license subscriptions revenue is derived from customers with on-premises installations of our platform. The majority of our contracts are one year in length. Although term license subscriptions are sold with maintenance and support, the software is fully functional at the beginning of the subscription and is considered a distinct performance obligation. If a cloud-based subscription includes the right for the customer to take possession of the license, the revenue is treated as a term license. Revenue from term license subscriptions is recognized when control of the software license has transferred to the customer, which is the later of delivery or commencement of the contract term. Maintenance and Support Maintenance and support subscriptions include both technical support and when-and-if-available software upgrades, which are treated as a single performance obligation as they are considered a series of distinct services that are substantially the same and have the same duration and measure of progress. Revenue from maintenance and support is recognized ratably over the contract period, which is the period over which the customer has continuous access to maintenance and support. Professional Services Revenue Our professional services revenue is comprised of fees for consulting services, including application development and deployment assistance as well as training services related to our platform. Our professional services are considered distinct performance obligations when sold standalone or with other products. Consulting Services We sell consulting services to assist customers in planning and executing the deployment of our software. Customers are not required to use consulting services to fully benefit from the software. Consulting services are regularly sold on a standalone basis and most often as either (1) under a fixed-fee arrangement or (2) on a time and materials basis. We also sell advisory services on a subscription basis to support customers or partners with their development and deployment. Consulting services contracts are considered separate performance obligations because they do not integrate with each other or with other products and services to deliver a combined output to the customer, do not modify or customize (or are not modified or customized by) each other or other products and services, and do not affect the customer's ability to use the other consulting offerings or other products and services. Revenue under consulting contracts is recognized over time as services are delivered. Revenue from subscription-based consulting contracts is recognized ratably over the contract period. For time and materials-based consulting contracts, we have elected the practical expedient of recognizing revenue upon invoicing since the invoiced amount corresponds directly to the value of our service to date. Training Services We sell various training services to our customers. Training services are sold in the form of prepaid training credits that are redeemed based on a fixed rate per course. Training revenue is recognized when the associated training services are delivered. Significant Judgments and Estimates Determining the Transaction Price The transaction price is the total amount of consideration we expect to receive in exchange for the service offerings in a contract and may include both fixed and variable components. Variable consideration is included in the transaction price to the extent it is probable a significant reversal will not occur. The amount of variable consideration excluded from the transaction price for the three months ended March 31, 2024 and 2023 was immaterial. Our estimates of variable consideration are also subject to subsequent true-up adjustments and may result in changes to transaction prices; however, such true-up adjustments are not expected to be material. Allocating the Transaction Price Based on Standalone Selling Prices (“SSP”) We allocate the transaction price to each performance obligation in a contract based on its relative SSP. The SSP is the observable price at which we sell the product or service separately. In the absence of observable pricing, we estimate SSP using the residual approach. We establish SSP as follows: 1. Cloud subscriptions - Given the highly variable selling price of our cloud subscriptions, we establish the SSP of our cloud subscriptions using a residual approach after first determining the SSP of consulting and training services. We have concluded the residual approach to estimating the SSP of our cloud subscriptions is an appropriate allocation of the transaction price. 2. Term license subscriptions - Given the highly variable selling price of our term license subscriptions, we have established the SSP of term license subscriptions using a residual approach after first determining the SSP of maintenance and support. Maintenance and support is sold on a standalone basis in conjunction with renewals of our legacy perpetual software licenses and within a narrow range of the net license fee. Because an economic relationship exists between the license and maintenance and support, we have concluded the residual approach to estimating the SSP of term license subscriptions is an appropriate allocation of the transaction price. 3. Maintenance and support - We establish the SSP of maintenance and support as a percentage of the stated net subscription fee based on observable pricing of maintenance and support renewals from our legacy perpetual software licenses. 4. Consulting and training services - The SSP of consulting and training services is established based on the observable pricing of standalone sales within each geographic region where the services are sold. Contract Balances Timing may differ between the satisfaction of performance obligations and the invoicing and collection of amounts related to our contracts with customers. Contract assets primarily relate to unbilled amounts for contracts with customers for which the amount of revenue recognized exceeds the amount billed to the customer. Contract assets are transferred to accounts receivable when the right to invoice becomes unconditional. Contract liabilities consist of deferred revenue and include payments received in advance of the satisfaction of performance obligations. Deferred revenue is then recognized as the revenue recognition criteria are met. Deferred revenue that will be recognized during the succeeding 12-month period is recorded as current, and the remaining deferred revenue is recorded as non-current. The following table sets forth our contract asset and contract liability balances (in thousands): As of March 31, 2024 December 31, 2023 March 31, 2023 December 31, 2022 Contract assets, current * $ 10,371 $ 12,052 $ 13,883 $ 12,540 Contract assets, non-current * 1,192 915 1,051 1,720 Total contract assets $ 11,563 $ 12,967 $ 14,934 $ 14,260 Deferred revenue, current $ 220,943 $ 235,992 $ 193,902 $ 194,768 Deferred revenue, non-current 5,216 4,700 4,750 5,556 Total contract liabilities $ 226,159 $ 240,692 $ 198,652 $ 200,324 * Current and non-current contract assets are reported as components of the ‘Prepaid expenses and other current assets’ and ‘Other assets’ line items, respectively, in our consolidated balance sheets. Revenue recognized from amounts included in contract liabilities at the beginning of the period totaled $94.2 million and $85.4 million for the three months ended March 31, 2024 and 2023, respectively. Transaction Price Allocated to the Remaining Performance Obligations As of March 31, 2024, we had an aggregate transaction price of $468.3 million allocated to unsatisfied performance obligations. We expect to recognize $296.3 million of this balance as revenue over the next 12 months with the remaining amount recognized thereafter.

Leases

Leases	3 Months Ended
	Mar. 31, 2024
Leases [Abstract]
Leases	4. Leases As of March 31, 2024, our lease portfolio consists entirely of operating leases for corporate offices. Our operating leases have remaining lease terms with various expiration dates through 2031, and some leases include options to extend the term for up to an additional 10 years. Lease Costs Expense for operating leases is recognized on a straight-line basis over the lease term as an operating expense. We have lease agreements which require payments for lease and non-lease components (i.e., common area maintenance) that are accounted for as a single lease component. Variable lease payment amounts that cannot be determined at the commencement of the lease such as maintenance costs, utilities, and service charges, are not included in right-of-use (“ROU”) assets or lease liabilities but rather are expensed as incurred and recorded as variable lease expense. We often receive customary incentives from our landlords such as tenant improvement allowances (“TIAs”) and rent abatement periods, which effectively reduce total lease payments owed for the leases. The following table sets forth the components of lease expense for the three months ended March 31, 2024 and 2023 (in thousands, exclusive of sublease income): Three Months Ended March 31, 2024 2023 Operating lease cost $ 2,411 $ 2,146 Short-term lease cost 332 365 Variable lease cost 1,313 1,026 Total $ 4,056 $ 3,537 Sublease income totaled $0.3 million for each of the three months ended March 31, 2024 and 2023. Supplemental Lease Information Supplemental balance sheet information related to operating leases as of March 31, 2024 and December 31, 2023 is presented in the following table (in thousands, except for lease term and discount rate): As of March 31, 2024 December 31, 2023 Right-of-use assets for operating leases $ 39,074 $ 39,975 Operating lease liabilities, current $ 12,219 $ 11,698 Operating lease liabilities, net of current portion 57,357 59,067 Total operating lease liabilities $ 69,576 $ 70,765 Weighted average remaining lease term (in years) 7.2 7.4 Weighted average discount rate 9.4 % 9.4 % Supplemental cash flow and expense information related to operating leases for the three months ended March 31, 2024 and 2023 is shown below (in thousands): Three Months Ended March 31, 2024 2023 Operating cash outflows for operating leases $ 2,643 $ 1,132 Amortization of operating lease right-of-use assets 783 652 Interest expense on operating lease liabilities 1,629 1,495 There were no TIA reimbursements for the three months ended March 31, 2024, while TIA reimbursements totaled $0.6 million for the three months ended March 31, 2023. A summary of our future minimum lease commitments under non-cancellable leases as of March 31, 2024 is shown below (in thousands): Operating Leases 2024 (excluding the three months ended March 31, 2024) $ 9,521 2025 12,963 2026 13,283 2027 13,535 2028 12,450 Thereafter 34,840 Total lease payments 96,592 Less: imputed interest (27,016) Total $ 69,576

Goodwill and Intangible Assets

Goodwill and Intangible Assets	3 Months Ended
	Mar. 31, 2024
Goodwill and Intangible Assets Disclosure [Abstract]
Goodwill and Intangible Assets	5. Goodwill and Intangible Assets The following table details the changes in goodwill during the three months ended March 31, 2024 and fiscal year ended December 31, 2023 (in thousands): Carrying Amount Balance as of December 31, 2022 $ 26,349 Foreign currency translation adjustments 757 Balance as of December 31, 2023 27,106 Foreign currency translation adjustments (588) Balance as of March 31, 2024 $ 26,518 Intangible assets, net consisted of the following as of March 31, 2024 and December 31, 2023 (in thousands): As of March 31, 2024 December 31, 2023 Developed technology $ 6,937 $ 7,091 Customer relationships 929 950 Intangible assets, gross 7,866 8,041 Less: accumulated amortization (4,432) (4,152) Intangible assets, net $ 3,434 $ 3,889 Intangible amortization expense was $0.4 million for each of the three months ended March 31, 2024 and 2023. As of March 31, 2024, the weighted average remaining amortization periods for developed technology and customer relationships were approximately 2.3 years and 7.0 years, respectively. The following table shows the projected annual amortization expense related to amortizable intangible assets as of March 31, 2024 (in thousands): Projected Amortization 2024 (excluding the three months ended March 31, 2024) $ 1,110 2025 1,178 2026 758 2027 93 2028 93 Thereafter 202 Total projected amortization expense $ 3,434

Property and Equipment, net

Property and Equipment, net	3 Months Ended
	Mar. 31, 2024
Property, Plant and Equipment [Abstract]
Property and Equipment, net	6. Property and Equipment, net Property and equipment, net consisted of the following as of March 31, 2024 and December 31, 2023 (in thousands): As of March 31, 2024 December 31, 2023 Leasehold improvements $ 54,148 $ 53,313 Office furniture and fixtures 4,437 3,825 Computer software and hardware 10,378 10,491 Internally developed software 306 — Equipment 193 194 Property and equipment, gross 69,462 67,823 Less: accumulated depreciation (26,904) (25,141) Property and equipment, net $ 42,558 $ 42,682

Accrued Expenses

Accrued Expenses	3 Months Ended
	Mar. 31, 2024
Payables and Accruals [Abstract]
Accrued Expenses	7. Accrued Expenses Accrued expenses consisted of the following as of March 31, 2024 and December 31, 2023 (in thousands): As of March 31, 2024 December 31, 2023 Hosting costs $ 3,600 $ 2,973 Legal costs 252 103 Marketing and tradeshow expenses 917 685 Third party license fees 726 678 Contract labor costs 1,132 600 Reimbursable employee expenses 1,128 880 Taxes payable 760 1,261 Audit and tax expenses 1,303 1,499 Capital expenditures 476 644 Other accrued expenses 1,958 1,723 Total $ 12,252 $ 11,046

Debt

Debt	3 Months Ended
	Mar. 31, 2024
Debt Disclosure [Abstract]
Debt	8. Debt Senior Secured Credit Facilities Credit Agreement We have a Senior Secured Credit Facilities Credit Agreement (the “Credit Agreement”) which provides for a five-year term loan facility in an aggregate principal amount of $200.0 million and, in addition, up to $100.0 million for a revolving credit facility, including a letter of credit sub-facility in the aggregate availability amount of $20.0 million and a swingline sub-facility in the aggregate availability amount of $10.0 million (as a sublimit of the revolving loan facility). The Credit Agreement matures on November 3, 2027. We will use the proceeds to continue funding the growth of our business and support our working capital requirements. Under the agreement, we may elect whether amounts drawn bear interest on the outstanding principal amount at a rate per annum equal to either (a) the higher of the Prime rate or the Federal Funds Effective rate (“Base Rate”) plus 0.5% or (b) the forward-looking term rate based on the secured overnight financing rate (“Term SOFR”). An additional interest rate margin is added to the elected interest rates. During the first three years of the Credit Agreement, the additional interest rate margin ranges from 1.5% to 2.5% in the case of Base Rate advances or from 2.5% to 3.5% in the case of Term SOFR advances, depending on our debt to recurring revenue leverage ratio (as defined in the Credit Agreement). During the final two years of the Credit Agreement, the interest rate margin ranges from 0.5% to 2.5% in the case of Base Rate advances and from 1.5% to 3.5% in the case of Term SOFR advances, depending on our debt to consolidated adjusted EBITDA leverage ratio (as defined in the Credit Agreement). In addition, the Credit Agreement contains other customary representations, warranties, and covenants, including covenants by us limiting additional indebtedness, guarantees, liens, fundamental changes, mergers and consolidations, dispositions of assets, investments, paying dividends on capital stock or redeeming, repurchasing, or retiring capital stock, prepaying certain junior indebtedness and preferred stock, certain corporate changes, and transactions with affiliates. The Credit Agreement also provides for customary events of default, including but not limited to, non-payment, breaches, or defaults in the performance of covenants, insolvency, bankruptcy, and the occurrence of a material adverse effect on us. The following table summarizes outstanding debt balances (in thousands): As of March 31, 2024 December 31, 2023 Borrowings under revolving credit facility $ 62,000 $ 62,000 Secured term loan facility 194,563 145,813 Less: Debt issuance costs (1) (1,440) (1,224) Total debt, net of debt issuance costs $ 255,123 $ 206,589 Debt, current $ 7,098 $ 66,368 Long-term debt 248,025 140,221 Total debt $ 255,123 $ 206,589 (1) Deferred debt issuance costs associated with the term loan facility are recorded net of the debt obligation and amortized to interest expense over the term of the Credit Agreement. We were in compliance with all covenants contained in the Credit Agreement. As of March 31, 2024, we had $62.0 million outstanding under our $100.0 million revolving credit facility, and we had outstanding letters of credit totaling $11.8 million in connection with securing our leased office space.

Income Taxes

Income Taxes	3 Months Ended
	Mar. 31, 2024
Income Tax Disclosure [Abstract]
Income Taxes	9. Income Taxes The provision for income taxes is based upon the estimated annual effective tax rates for the year applied to the current period income before tax plus the tax effect of any significant or unusual items, discrete events, or changes in tax law. Our operating subsidiaries are exposed to statutory effective tax rates ranging from zero to approximately 35%. Fluctuations in the distribution of pre-tax income among our operating subsidiaries can lead to fluctuations of the effective tax rate in the condensed consolidated financial statements. For the three months ended March 31, 2024 and 2023, the actual effective tax rates were 1.4% and (3.2)%, respectively. As of March 31, 2024, our net unrecognized tax benefits totaled $6.5 million, which if recognized would result in no net effect on the effective tax rate due to a valuation allowance. The amount of reasonably possible unrecognized tax benefits that could decrease over the next 12 months due to the expiration of certain statutes of limitations or settlements of tax audits is not material to our condensed consolidated financial statements. We file income tax returns in the U.S. federal jurisdiction and in various state and foreign jurisdictions. Due to our net operating loss carryforwards, the tax years 2016 through 2023 remain open to examination by the major taxing jurisdictions to which we are subject. There are no open examinations that would have a meaningful impact on our condensed consolidated financial statements.

Stock-Based Compensation

Stock-Based Compensation	3 Months Ended
	Mar. 31, 2024
Share-Based Payment Arrangement [Abstract]
Stock-Based Compensation	10. Stock-Based Compensation Compensation expense related to stock-based awards is accounted for using the estimated fair value of the award on the grant date. We calculate the fair value of stock options containing only a service condition using the Black-Scholes option pricing model. The fair value of restricted stock units (“RSUs”) is based on the closing market price of our common stock on the Nasdaq Global Market on the date of grant. For service-based awards such as RSUs, stock-based compensation expense is recognized on a straight-line basis over the requisite service period. In June 2022, our Board of Directors granted to our Chief Executive Officer (“CEO”) a stock option award that is eligible to vest based on the achievement of various stock price appreciation targets. This option grant (the “2022 CEO option grant”) is our only outstanding stock-based award that vests based on the achievement of market conditions. For awards with market-based conditions, compensation expense is measured using a Monte Carlo simulation, and expense is recognized using the accelerated attribution method over the derived service period based on the expected market performance as of the grant date. We account for forfeitures of our stock-based awards as they occur rather than estimating expected forfeitures. As of March 31, 2024, the total compensation cost related to unvested stock options not yet recognized, which relates exclusively to the 2022 CEO option grant, was $9.7 million and will be recognized over a weighted average period of 2.0 years. Total unrecognized compensation cost related to unvested RSUs was approximately $42.6 million, which will be recognized over a weighted average period of 1.3 years. The following table summarizes the components of our stock-based compensation expense for the three months ended March 31, 2024 and 2023 (in thousands): Three Months Ended March 31, 2024 2023 Cost of revenue Subscriptions $ 213 $ 272 Professional services 1,578 1,591 Operating expenses Sales and marketing 2,527 2,445 Research and development 3,001 3,626 General and administrative 3,287 3,122 Total stock-based compensation expense $ 10,606 $ 11,056

Basic and Diluted Loss per Shar

Basic and Diluted Loss per Share	3 Months Ended
	Mar. 31, 2024
Earnings Per Share [Abstract]
Basic and Diluted Loss per Share	11. Basic and Diluted Loss per Share Basic net loss per share is computed by dividing net loss by the weighted average number of common shares outstanding during the reporting period. Diluted loss per share is computed similar to basic, except the weighted average number of common shares outstanding is increased to include additional outstanding shares from the assumed exercise of stock options and vesting of RSUs, if dilutive. The dilutive effect, if any, of convertible shares is calculated using the treasury stock method. As we reported net losses for all periods presented, all outstanding shares would be considered antidilutive if they were to be assumed as vested or exercised. The following outstanding securities, prior to the use of the treasury stock method, have been excluded from the computation of diluted weighted-average shares outstanding for the respective periods below because they would have been antidilutive to earnings per share: Three Months Ended March 31, 2024 2023 Stock options 2,555,509 2,678,476 Non-vested restricted stock units 1,183,674 1,190,286

Commitments, Contingencies, and

Commitments, Contingencies, and Other Matters	3 Months Ended
	Mar. 31, 2024
Commitments and Contingencies Disclosure [Abstract]
Commitments, Contingencies, and Other Matters	12. Commitments, Contingencies, and Other Matters Minimum Purchase Commitments We have a non-cancellable cloud hosting arrangement with Amazon Web Services (“AWS”) that contains provisions for minimum purchase commitments. Specifically, purchase commitments under the agreement total $131.0 million over five years. The agreement, which started July 2021 and is now in its third year as of March 31, 2024, contains minimum spending requirements of $28.0 million in each of the third, fourth, and fifth years. Spending under this agreement for the three months ended March 31, 2024 and 2023 totaled $10.3 million and $9.4 million, respectively. The timing of payments under the agreement may vary. Exclusive of the AWS contract, we have other non-cancellable agreements for subscription software products that contain provisions stipulating minimum purchase commitments. However, the annual purchase commitments under these contracts are, individually and in the aggregate, immaterial to our condensed consolidated financial statements. Pegasystems Litigation On May 29, 2020, we filed a civil complaint against Pegasystems, Inc. (“Pegasystems”) and Youyong Zou, a Virginia resident, in the Circuit Court for Fairfax County, Virginia. Appian Corp v. Pegasystems Inc. & Youyong Zou, No. 2020-07216 (Fairfax Cty. Ct.). On May 10, 2022, we announced the jury awarded us $2.036 billion in damages for misappropriation of our trade secrets and $1 in damages for violating the Virginia Computer Crimes Act. Pegasystems filed several post-trial motions seeking relief in the form of reducing the damages award or setting aside the jury’s verdict and either granting a new trial or entering judgment in Pegasystems’ favor. All of these motions were denied, and final judgment was entered by the Court on September 15, 2022. The final judgment reaffirmed the $2.036 billion in damages and also ordered Pegasystems to pay Appian $23.6 million in attorney's fees associated with the case as well as statutory post-judgment interest on the judgment at an annual rate of 6%, or approximately $122.0 million per year. Defendant Youyong Zou has satisfied the judgment of $5,000 (plus interest) against him in lieu of appealing that judgment. On September 15, 2022, Pegasystems filed a notice of appeal to the Court of Appeals of Virginia. Both sides have submitted their respective appeal briefs to the Court of Appeals, and the Court held a hearing on the appeal on November 15, 2023. The timeline of the case is solely within the control of the Court of Appeals until it rules. Pegasystems is not required to pay us the judgment, attorney’s fees, or post-judgment interest until all appeals are exhausted. We cannot predict the outcome of any appeals or the exact time it will take to resolve them. Consistent with other judgments, there is no guarantee we will be able to collect all or any portion of the judgment. Consequently, we will not record the award in our condensed consolidated financial statements until all contingencies are resolved and we collect on the judgment. Judgment Preservation Insurance On September 1, 2023, we entered into a Judgment Preservation Insurance (“JPI”) policy in connection with our $2.036 billion judgment against Pegasystems. The total cost of the policy was $57.3 million and is comprised of the premium, a one-time broker fee, and Virginia lines tax. The policy provides up to $500.0 million of coverage. The total cost of the policy was capitalized and will be amortized on a straight-line basis over the estimated length of the appeals process. As of March 31, 2024, we estimated the length of the appeals process (solely for amortization purposes) to be approximately three years. This estimate is updated each reporting period. Amortization expense associated with the JPI premium is recorded to general and administrative expenses in our consolidated statements of operations. JPI amortization expense was $4.5 million for the three months ended March 31, 2024. As of March 31, 2024, $18.1 million of the unamortized balance is classified as ‘Prepaid expenses and other current assets’ while the remaining $28.7 million is classified as 'Other assets’ on our consolidated balance sheets. Other Legal Matters From time to time, we are subject to legal, regulatory, and other proceedings and claims that arise in the ordinary course of business. Other than as disclosed elsewhere in this Quarterly Report, we are not presently a party to any legal proceedings that, if determined adversely to us, would individually or taken together have a material adverse effect on our business, operating results, financial condition, or cash flows. Regardless of the outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources, and other factors. Share Repurchase Program

Segment and Geographic Informat

Segment and Geographic Information	3 Months Ended
	Mar. 31, 2024
Segment Reporting [Abstract]
Segment and Geographic Information	13. Segment and Geographic Information The following table summarizes revenue by geography for the three months ended March 31, 2024, and 2023 (in thousands): Three Months Ended March 31, 2024 2023 Domestic $ 94,113 $ 90,005 International 55,722 45,230 Total $ 149,835 $ 135,235 With respect to geographic information, revenue is attributed to respective geographies based on the contracting address of the customer. The value of our long-lived assets, which are comprised of property and equipment and intangible assets, held in the United States and internationally as of March 31, 2024 were $33.0 million and $13.0 million, respectively. As of December 31, 2023, our long-lived assets held in the United States and internationally were $34.0 million and $12.6 million, respectively.

Investments and Fair Value Meas

Investments and Fair Value Measurements	3 Months Ended
	Mar. 31, 2024
Investments, Debt and Equity Securities [Abstract]
Investments and Fair Value Measurements	14. Investments and Fair Value Measurements Fair Value Measurements U.S. GAAP establishes a three-tier fair value hierarchy to classify and disclose all assets and liabilities measured at fair value on a recurring basis, as well as assets and liabilities measured at fair value on a non-recurring basis, in periods subsequent to their initial measurement. The hierarchy requires us to use observable inputs when available and to minimize the use of unobservable inputs when determining fair value. The three tiers are defined as follows: • Level 1 - Observable inputs based on unadjusted quoted prices in active markets for identical assets or liabilities; • Level 2 - Inputs, other than quoted prices in active markets, that are observable either directly or indirectly; and • Level 3 - Unobservable inputs for which there is little or no market data and which require us to develop our own estimates and assumptions reflecting those that a market participant would use. The asset or liability’s fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Valuation techniques maximize the use of relevant observable inputs and minimize the use of unobservable inputs. There were no instruments measured at fair value on a recurring basis using significant unobservable inputs as of March 31, 2024 and December 31, 2023. The valuation techniques that may be used to measure fair value are as follows: • Market approach - Uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities; • Income approach - Uses valuation techniques to convert future amounts to a single present amount based on current market expectations about those future amounts; and • Cost approach - Based on the amount that currently would be required to replace the service capacity of an asset (i.e., replacement cost). The carrying amounts of our restricted cash, accounts receivable, accounts payable, and accrued expenses approximate fair value as of March 31, 2024 and December 31, 2023 because of the relatively short duration of these instruments. Additionally, the carrying value of our debt associated with the term loan facility approximates fair value because the interest rates are variable and reset on relatively short durations to the then market rates. Investments Our investment portfolio has historically consisted largely of debt investments classified as available-for-sale. Changes in the fair value of available-for-sale securities, excluding other-than-temporary impairments, have been recorded in ‘Accumulated other comprehensive income (loss)’ in our consolidated balance sheets. As of March 31, 2024, our cash and cash equivalents totaled $170.1 million, of which $86.0 million was held in readily available checking accounts or overnight repurchase investment accounts, and $84.1 million was held in money market funds with less than 90 days of maturity. Our cash and cash equivalents are classified as Level 1 assets. We did not hold any short- or long-term investments as of March 31, 2024. At December 31, 2023, our investments consisted of the following (in thousands): As of December 31, 2023 Fair Value Measurement Balance Sheet Classification Fair Value Level Cost Basis Unrealized Gains (Losses) Fair Value Cash and Cash Equivalents Short-term Investments and Marketable Securities Cash Level 1 $ — $ — $ 93,029 $ 93,029 $ — Money market fund Level 1 56,322 — 56,322 56,322 — U.S. Treasury bonds Level 1 4,830 (2) 4,828 — 4,828 Agency bonds Level 2 4,828 (3) 4,825 — 4,825 Total investments $ 65,980 $ (5) $ 159,004 $ 149,351 $ 9,653 We did not hold any Level 3 assets at any point during the three months ended March 31, 2024 and 2023. Additionally, there were no transfers between Levels 1 and 2 during the three months ended March 31, 2024 and 2023. Interest income on our investments totaled $1.9 million and $2.1 million for the three months ended March 31, 2024 and 2023, respectively. The contractual maturities of our debt securities as of December 31, 2023 were all one year or less. Actual maturities may differ from contractual maturities because borrowers have the right to call or prepay certain obligations.

Accounting Policies (Policies)

Accounting Policies (Policies)	3 Months Ended
	Mar. 31, 2024
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation The accompanying unaudited condensed consolidated financial statements and footnotes include the accounts of Appian and its wholly-owned subsidiaries and have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) as contained in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) for interim financial reporting. In the opinion of management, the interim financial information includes all adjustments of a normal recurring nature necessary for a fair presentation of the results of operations, financial position, changes in stockholders’ equity, and cash flows. All intercompany accounts and transactions have been eliminated in consolidation. The results of operations for the current period are not necessarily indicative of the results for the full year or the results for any future periods. These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related footnotes included in our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the Securities and Exchange Commission (the “SEC”) on February 15, 2024.
Use of Estimates	Use of Estimates The preparation of our condensed consolidated financial statements in conformity with U.S. GAAP requires us to make estimates and judgments that affect the amounts reported in these condensed consolidated financial statements and accompanying notes. Although we believe the estimates we use are reasonable, due to the inherent uncertainty involved in making these estimates, actual results reported in future periods could differ from those estimates. Significant estimates embedded in the condensed consolidated financial statements include, but are not limited to, revenue recognition, income taxes and the related valuation allowance established against deferred tax assets, the amortization period of deferred commissions, the amortization period of the cost to obtain the judgment preservation insurance (as discussed in Note 12), and stock-based compensation.
Concentration of Credit and Customer Risk	Concentration of Credit and Customer Risk Our financial instruments exposed to concentration of credit and customer risk consist primarily of cash, cash equivalents, accounts receivable, and our short- and long-term investments. Deposits held with banks may exceed the amount of insurance provided on such deposits; however, we believe the financial institutions holding our cash deposits are financially sound and, accordingly, minimal credit risk exists with respect to these balances.
Cash, Cash Equivalents, and Restricted Cash	Cash, Cash Equivalents, and Restricted Cash We consider all highly liquid investments with original maturities of three months or less, as well as overnight repurchase agreements, to be cash equivalents. Restricted cash consisted of cash designated to settle an escrow liability stemming from a holdback agreement related to our acquisition of Lana Labs GmbH. We paid the remaining amount owed on August 11, 2023.
Accounts Receivable and Allowance for Doubtful Accounts	Accounts Receivable and Allowance for Doubtful Accounts
Deferred Commissions	Deferred Commissions We capitalize costs of obtaining a contract with a customer, which consist of sales commissions paid to our sales team, and the associated incremental payroll taxes. These costs are recorded as deferred commissions in the consolidated balance sheets. Costs to obtain a contract for a new customer or upsell an existing customer are amortized over an estimated economic life of five years as sales commissions on initial sales are not commensurate with sales commissions on contract renewals. Commissions paid relating to contract renewals are deferred and amortized over the related renewal period. We determine the estimated economic life based on both qualitative and quantitative factors such as expected renewals, product life cycles, contractual terms, and customer attrition. We periodically review the carrying amount of deferred contract acquisition costs to determine whether events or changes in circumstances have occurred that could impact the estimated economic life. Costs to obtain a contract for professional services arrangements are expensed as incurred as the contractual period of our professional services arrangements are one year or less.
Property and Equipment	Property and Equipment Property and equipment are stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. Significant additions or improvements extending the useful life of an asset are capitalized, while repairs and maintenance costs which do not significantly improve the related assets or extend their useful lives are charged to expense as incurred. The estimated useful lives of our property and equipment are generally 3 years for computer software, computer hardware, and internally developed software, 5 years for equipment, and 10 years years for office furniture and fixtures. Leasehold improvements have an estimated useful life of the shorter of the useful life of the assets or the lease term.
Severance Costs	Severance Costs
Treasury Stock	Treasury Stock We account for treasury stock under the cost method. When treasury stock is reissued at a price higher than its cost, the difference is recorded as a component of additional paid-in-capital (“APIC”) in our consolidated balance sheets. When treasury stock is reissued at a price lower than its cost, the difference is recorded as a component of APIC to the extent there are previously recorded gains to offset the losses. If there are no treasury stock gains in APIC, the losses upon reissuance of treasury stock are recorded as an increase to accumulated deficit.
Recent Accounting Pronouncements	Recent Accounting Pronouncements Adopted We have not adopted any new accounting guidance in 2024 that has had a material impact on our condensed consolidated financial statements or disclosures. Not Yet Adopted In November 2023, the FASB issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280): Improvement to Reportable Segment Disclosures (ASU 2023-07), which enhances the disclosure requirements for operating segments in our annual and interim consolidated financial statements. The new guidance is effective for us beginning with our annual reporting for fiscal year 2024 and for interim period reporting beginning in fiscal year 2025 and will be applied on a retrospective basis. Early adoption is permitted. The new ASU requires public companies to disclose significant segment expenses and other segment items on an annual and interim basis and provide in interim periods all disclosures about a reportable segment’s profit or loss and assets that are currently required annually. Additionally, it requires public companies to disclose the title and position of the Chief Operating Decision Maker (“CODM”). The ASU does not change how a public entity identifies its operating segments, aggregates them, or applies the quantitative thresholds to determine its reportable segments. This guidance also applies to public entities that have only one segment. This ASU will only impact our disclosures with no impacts to our results of operations, cash flows, and financial condition. In December 2023, the FASB issued ASU 2023-09, Income Tax (Topic 740): Improvement to Income Tax Disclosures (ASU 2023-09), which requires public companies to disclose, on an annual basis, a tabular rate reconciliation using both percentages and currency amounts, broken out into specified categories with certain reconciling items further broken out by nature and jurisdiction to the extent those items exceed a specified threshold. In addition, all entities are required to disclose income taxes paid, net of refunds received disaggregated by federal, state/local, and foreign and by jurisdiction if the amount is at least 5% of total income tax payments, net of refunds received. The new guidance will be effective for our annual reporting for fiscal year 2025 on a prospective basis with the option to apply the standard retrospectively. Early adoption is permitted. This ASU will only impact our disclosures with no impacts to our results of operations, cash flows, and financial condition. In March 2024, the SEC issued its final climate disclosure rule, which requires the disclosure of material Scope 1 and Scope 2 greenhouse gas emissions and other climate-related topics in annual reports if they are reasonably likely to have a material impact on the Company’s business. For large accelerated filers, disclosure requirements will begin phasing in for fiscal years beginning on or after January 1, 2025. Subsequent to issuance, the rules became the subject of litigation, and the SEC has issued a stay to allow the legal process to proceed. We are currently evaluating the impact these rules will have on our financial statements and related disclosures and will monitor the litigation progress for possible impacts on the disclosure requirements under the rules.
Revenue Recognition	Revenue Recognition We generate subscriptions revenue primarily through the sale of cloud subscriptions bundled with maintenance and support and hosting services as well as term license subscriptions bundled with maintenance and support. We generate professional services revenue from fees for our consulting services, including application development and deployment assistance as well as training related to our platform. Performance Obligations and Timing of Revenue Recognition We primarily sell products and services that fall into the categories discussed below. Each category contains one or more performance obligations that are either (1) capable of being distinct (i.e., the customer can benefit from the product or service on its own or together with readily available resources, including those purchased separately from us) and distinct within the context of the contract (i.e., separately identified from other promises in the contract) or (2) a series of distinct products or services that are substantially the same and have the same pattern of transfer to the customer. Our term license subscriptions are delivered at a point in time while our cloud subscriptions, maintenance and support, and professional services are delivered over time. Subscriptions Revenue Subscriptions revenue is primarily related to (1) cloud subscriptions bundled with maintenance and support and hosting services and (2) term license subscriptions bundled with maintenance and support. We generally charge subscription fees on a per-user basis or through non-user based single application licenses. We bill customers and collect payment for subscriptions to our platform in advance on an annual, quarterly, or monthly basis. In certain instances, our customers have paid their entire contract up front. Cloud Subscriptions We generate cloud-based subscriptions revenue primarily from the sales of subscriptions to access our cloud offering, together with related support services to our customers. We perform all required maintenance and support for our cloud offering. Revenue is recognized on a ratable basis over the contract term beginning on the date the service is made available to the customer. Our cloud-based subscription contracts generally have a term of one Term License Subscriptions Our term license subscriptions revenue is derived from customers with on-premises installations of our platform. The majority of our contracts are one year in length. Although term license subscriptions are sold with maintenance and support, the software is fully functional at the beginning of the subscription and is considered a distinct performance obligation. If a cloud-based subscription includes the right for the customer to take possession of the license, the revenue is treated as a term license. Revenue from term license subscriptions is recognized when control of the software license has transferred to the customer, which is the later of delivery or commencement of the contract term. Maintenance and Support Maintenance and support subscriptions include both technical support and when-and-if-available software upgrades, which are treated as a single performance obligation as they are considered a series of distinct services that are substantially the same and have the same duration and measure of progress. Revenue from maintenance and support is recognized ratably over the contract period, which is the period over which the customer has continuous access to maintenance and support. Professional Services Revenue Our professional services revenue is comprised of fees for consulting services, including application development and deployment assistance as well as training services related to our platform. Our professional services are considered distinct performance obligations when sold standalone or with other products. Consulting Services We sell consulting services to assist customers in planning and executing the deployment of our software. Customers are not required to use consulting services to fully benefit from the software. Consulting services are regularly sold on a standalone basis and most often as either (1) under a fixed-fee arrangement or (2) on a time and materials basis. We also sell advisory services on a subscription basis to support customers or partners with their development and deployment. Consulting services contracts are considered separate performance obligations because they do not integrate with each other or with other products and services to deliver a combined output to the customer, do not modify or customize (or are not modified or customized by) each other or other products and services, and do not affect the customer's ability to use the other consulting offerings or other products and services. Revenue under consulting contracts is recognized over time as services are delivered. Revenue from subscription-based consulting contracts is recognized ratably over the contract period. For time and materials-based consulting contracts, we have elected the practical expedient of recognizing revenue upon invoicing since the invoiced amount corresponds directly to the value of our service to date. Training Services We sell various training services to our customers. Training services are sold in the form of prepaid training credits that are redeemed based on a fixed rate per course. Training revenue is recognized when the associated training services are delivered. Significant Judgments and Estimates Determining the Transaction Price The transaction price is the total amount of consideration we expect to receive in exchange for the service offerings in a contract and may include both fixed and variable components. Variable consideration is included in the transaction price to the extent it is probable a significant reversal will not occur. The amount of variable consideration excluded from the transaction price for the three months ended March 31, 2024 and 2023 was immaterial. Our estimates of variable consideration are also subject to subsequent true-up adjustments and may result in changes to transaction prices; however, such true-up adjustments are not expected to be material. Allocating the Transaction Price Based on Standalone Selling Prices (“SSP”) We allocate the transaction price to each performance obligation in a contract based on its relative SSP. The SSP is the observable price at which we sell the product or service separately. In the absence of observable pricing, we estimate SSP using the residual approach. We establish SSP as follows: 1. Cloud subscriptions - Given the highly variable selling price of our cloud subscriptions, we establish the SSP of our cloud subscriptions using a residual approach after first determining the SSP of consulting and training services. We have concluded the residual approach to estimating the SSP of our cloud subscriptions is an appropriate allocation of the transaction price. 2. Term license subscriptions - Given the highly variable selling price of our term license subscriptions, we have established the SSP of term license subscriptions using a residual approach after first determining the SSP of maintenance and support. Maintenance and support is sold on a standalone basis in conjunction with renewals of our legacy perpetual software licenses and within a narrow range of the net license fee. Because an economic relationship exists between the license and maintenance and support, we have concluded the residual approach to estimating the SSP of term license subscriptions is an appropriate allocation of the transaction price. 3. Maintenance and support - We establish the SSP of maintenance and support as a percentage of the stated net subscription fee based on observable pricing of maintenance and support renewals from our legacy perpetual software licenses. 4. Consulting and training services - The SSP of consulting and training services is established based on the observable pricing of standalone sales within each geographic region where the services are sold. Contract Balances
Stock-Based Compensation Expense	Compensation expense related to stock-based awards is accounted for using the estimated fair value of the award on the grant date. We calculate the fair value of stock options containing only a service condition using the Black-Scholes option pricing model. The fair value of restricted stock units (“RSUs”) is based on the closing market price of our common stock on the Nasdaq Global Market on the date of grant. For service-based awards such as RSUs, stock-based compensation expense is recognized on a straight-line basis over the requisite service period. In June 2022, our Board of Directors granted to our Chief Executive Officer (“CEO”) a stock option award that is eligible to vest based on the achievement of various stock price appreciation targets. This option grant (the “2022 CEO option grant”) is our only outstanding stock-based award that vests based on the achievement of market conditions. For awards with market-based conditions, compensation expense is measured using a Monte Carlo simulation, and expense is recognized using the accelerated attribution method over the derived service period based on the expected market performance as of the grant date.
Fair Value Measurements	Fair Value Measurements U.S. GAAP establishes a three-tier fair value hierarchy to classify and disclose all assets and liabilities measured at fair value on a recurring basis, as well as assets and liabilities measured at fair value on a non-recurring basis, in periods subsequent to their initial measurement. The hierarchy requires us to use observable inputs when available and to minimize the use of unobservable inputs when determining fair value. The three tiers are defined as follows: • Level 1 - Observable inputs based on unadjusted quoted prices in active markets for identical assets or liabilities; • Level 2 - Inputs, other than quoted prices in active markets, that are observable either directly or indirectly; and • Level 3 - Unobservable inputs for which there is little or no market data and which require us to develop our own estimates and assumptions reflecting those that a market participant would use. The asset or liability’s fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Valuation techniques maximize the use of relevant observable inputs and minimize the use of unobservable inputs. There were no instruments measured at fair value on a recurring basis using significant unobservable inputs as of March 31, 2024 and December 31, 2023. The valuation techniques that may be used to measure fair value are as follows: • Market approach - Uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities; • Income approach - Uses valuation techniques to convert future amounts to a single present amount based on current market expectations about those future amounts; and • Cost approach - Based on the amount that currently would be required to replace the service capacity of an asset (i.e., replacement cost).
Investments	Investments

Accounting Policies (Tables)

Accounting Policies (Tables)	3 Months Ended
	Mar. 31, 2024
Accounting Policies [Abstract]
Schedule of Cash and Cash Equivalents	The following table presents a reconciliation of cash, cash equivalents, and restricted cash as presented in the consolidated statements of cash flows (in thousands): As of March 31, 2024 December 31, 2023 March 31, 2023 December 31, 2022 Cash and cash equivalents $ 170,108 $ 149,351 $ 198,679 $ 148,132 Restricted cash, current — — 2,280 2,249 Total cash, cash equivalents, and restricted cash $ 170,108 $ 149,351 $ 200,959 $ 150,381
Schedule of Restrictions on Cash and Cash Equivalents	The following table presents a reconciliation of cash, cash equivalents, and restricted cash as presented in the consolidated statements of cash flows (in thousands): As of March 31, 2024 December 31, 2023 March 31, 2023 December 31, 2022 Cash and cash equivalents $ 170,108 $ 149,351 $ 198,679 $ 148,132 Restricted cash, current — — 2,280 2,249 Total cash, cash equivalents, and restricted cash $ 170,108 $ 149,351 $ 200,959 $ 150,381

Revenue (Tables)

Revenue (Tables)	3 Months Ended
	Mar. 31, 2024
Revenue from Contract with Customer [Abstract]
Schedule of Revenue by Services	The following table summarizes revenue recorded during the three months ended March 31, 2024 and 2023 (in thousands): Three Months Ended March 31, 2024 2023 Cloud subscriptions $ 86,603 $ 69,692 Term license subscriptions 23,771 23,151 Maintenance and support 7,320 6,114 Total subscriptions 117,694 98,957 Professional services 32,141 36,278 Total revenue $ 149,835 $ 135,235
Schedule of Contract Asset and Contract Liability	The following table sets forth our contract asset and contract liability balances (in thousands): As of March 31, 2024 December 31, 2023 March 31, 2023 December 31, 2022 Contract assets, current * $ 10,371 $ 12,052 $ 13,883 $ 12,540 Contract assets, non-current * 1,192 915 1,051 1,720 Total contract assets $ 11,563 $ 12,967 $ 14,934 $ 14,260 Deferred revenue, current $ 220,943 $ 235,992 $ 193,902 $ 194,768 Deferred revenue, non-current 5,216 4,700 4,750 5,556 Total contract liabilities $ 226,159 $ 240,692 $ 198,652 $ 200,324 * Current and non-current contract assets are reported as components of the ‘Prepaid expenses and other current assets’ and ‘Other assets’ line items, respectively, in our consolidated balance sheets.

Leases (Tables)

Leases (Tables)	3 Months Ended
	Mar. 31, 2024
Leases [Abstract]
Schedule of Components of Lease Expense	The following table sets forth the components of lease expense for the three months ended March 31, 2024 and 2023 (in thousands, exclusive of sublease income): Three Months Ended March 31, 2024 2023 Operating lease cost $ 2,411 $ 2,146 Short-term lease cost 332 365 Variable lease cost 1,313 1,026 Total $ 4,056 $ 3,537
Schedule of Supplemental Balance Sheet Information	Supplemental balance sheet information related to operating leases as of March 31, 2024 and December 31, 2023 is presented in the following table (in thousands, except for lease term and discount rate): As of March 31, 2024 December 31, 2023 Right-of-use assets for operating leases $ 39,074 $ 39,975 Operating lease liabilities, current $ 12,219 $ 11,698 Operating lease liabilities, net of current portion 57,357 59,067 Total operating lease liabilities $ 69,576 $ 70,765 Weighted average remaining lease term (in years) 7.2 7.4 Weighted average discount rate 9.4 % 9.4 %
Schedule of Supplemental Cash Flow Information	Supplemental cash flow and expense information related to operating leases for the three months ended March 31, 2024 and 2023 is shown below (in thousands): Three Months Ended March 31, 2024 2023 Operating cash outflows for operating leases $ 2,643 $ 1,132 Amortization of operating lease right-of-use assets 783 652 Interest expense on operating lease liabilities 1,629 1,495
Schedule of Maturities of Operating Lease Liabilities	A summary of our future minimum lease commitments under non-cancellable leases as of March 31, 2024 is shown below (in thousands): Operating Leases 2024 (excluding the three months ended March 31, 2024) $ 9,521 2025 12,963 2026 13,283 2027 13,535 2028 12,450 Thereafter 34,840 Total lease payments 96,592 Less: imputed interest (27,016) Total $ 69,576

Goodwill and Intangible Assets

Goodwill and Intangible Assets (Tables)	3 Months Ended
	Mar. 31, 2024
Goodwill and Intangible Assets Disclosure [Abstract]
Schedule of Goodwill	The following table details the changes in goodwill during the three months ended March 31, 2024 and fiscal year ended December 31, 2023 (in thousands): Carrying Amount Balance as of December 31, 2022 $ 26,349 Foreign currency translation adjustments 757 Balance as of December 31, 2023 27,106 Foreign currency translation adjustments (588) Balance as of March 31, 2024 $ 26,518
Schedule of Finite-Lived Intangible Assets	Intangible assets, net consisted of the following as of March 31, 2024 and December 31, 2023 (in thousands): As of March 31, 2024 December 31, 2023 Developed technology $ 6,937 $ 7,091 Customer relationships 929 950 Intangible assets, gross 7,866 8,041 Less: accumulated amortization (4,432) (4,152) Intangible assets, net $ 3,434 $ 3,889
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense	The following table shows the projected annual amortization expense related to amortizable intangible assets as of March 31, 2024 (in thousands): Projected Amortization 2024 (excluding the three months ended March 31, 2024) $ 1,110 2025 1,178 2026 758 2027 93 2028 93 Thereafter 202 Total projected amortization expense $ 3,434

Property and Equipment, net (Ta

Property and Equipment, net (Tables)	3 Months Ended
	Mar. 31, 2024
Property, Plant and Equipment [Abstract]
Schedule of Property and Equipment, Net	Property and equipment, net consisted of the following as of March 31, 2024 and December 31, 2023 (in thousands): As of March 31, 2024 December 31, 2023 Leasehold improvements $ 54,148 $ 53,313 Office furniture and fixtures 4,437 3,825 Computer software and hardware 10,378 10,491 Internally developed software 306 — Equipment 193 194 Property and equipment, gross 69,462 67,823 Less: accumulated depreciation (26,904) (25,141) Property and equipment, net $ 42,558 $ 42,682

Accrued Expenses (Tables)

Accrued Expenses (Tables)	3 Months Ended
	Mar. 31, 2024
Payables and Accruals [Abstract]
Schedule of Accrued Expenses	Accrued expenses consisted of the following as of March 31, 2024 and December 31, 2023 (in thousands): As of March 31, 2024 December 31, 2023 Hosting costs $ 3,600 $ 2,973 Legal costs 252 103 Marketing and tradeshow expenses 917 685 Third party license fees 726 678 Contract labor costs 1,132 600 Reimbursable employee expenses 1,128 880 Taxes payable 760 1,261 Audit and tax expenses 1,303 1,499 Capital expenditures 476 644 Other accrued expenses 1,958 1,723 Total $ 12,252 $ 11,046

Debt (Tables)

Debt (Tables)	3 Months Ended
	Mar. 31, 2024
Debt Disclosure [Abstract]
Schedule of Outstanding Long-term Debt	The following table summarizes outstanding debt balances (in thousands): As of March 31, 2024 December 31, 2023 Borrowings under revolving credit facility $ 62,000 $ 62,000 Secured term loan facility 194,563 145,813 Less: Debt issuance costs (1) (1,440) (1,224) Total debt, net of debt issuance costs $ 255,123 $ 206,589 Debt, current $ 7,098 $ 66,368 Long-term debt 248,025 140,221 Total debt $ 255,123 $ 206,589 (1)

Stock-Based Compensation (Table

Stock-Based Compensation (Tables)	3 Months Ended
	Mar. 31, 2024
Share-Based Payment Arrangement [Abstract]
Schedule of Stock-based Compensation Expense Included in Condensed Consolidated Statements of Operations	The following table summarizes the components of our stock-based compensation expense for the three months ended March 31, 2024 and 2023 (in thousands): Three Months Ended March 31, 2024 2023 Cost of revenue Subscriptions $ 213 $ 272 Professional services 1,578 1,591 Operating expenses Sales and marketing 2,527 2,445 Research and development 3,001 3,626 General and administrative 3,287 3,122 Total stock-based compensation expense $ 10,606 $ 11,056

Basic and Diluted Loss per Sh_2

Basic and Diluted Loss per Share (Tables)	3 Months Ended
	Mar. 31, 2024
Earnings Per Share [Abstract]
Schedule of Securities Excluded from Calculation of Weighted Average Common Shares	The following outstanding securities, prior to the use of the treasury stock method, have been excluded from the computation of diluted weighted-average shares outstanding for the respective periods below because they would have been antidilutive to earnings per share: Three Months Ended March 31, 2024 2023 Stock options 2,555,509 2,678,476 Non-vested restricted stock units 1,183,674 1,190,286

Segment and Geographic Inform_2

Segment and Geographic Information (Tables)	3 Months Ended
	Mar. 31, 2024
Segment Reporting [Abstract]
Schedule of Revenue by Geography	The following table summarizes revenue by geography for the three months ended March 31, 2024, and 2023 (in thousands): Three Months Ended March 31, 2024 2023 Domestic $ 94,113 $ 90,005 International 55,722 45,230 Total $ 149,835 $ 135,235

Investments and Fair Value Me_2

Investments and Fair Value Measurements (Tables)	3 Months Ended
	Mar. 31, 2024
Investments, Debt and Equity Securities [Abstract]
Schedule of Components of Investments	At December 31, 2023, our investments consisted of the following (in thousands): As of December 31, 2023 Fair Value Measurement Balance Sheet Classification Fair Value Level Cost Basis Unrealized Gains (Losses) Fair Value Cash and Cash Equivalents Short-term Investments and Marketable Securities Cash Level 1 $ — $ — $ 93,029 $ 93,029 $ — Money market fund Level 1 56,322 — 56,322 56,322 — U.S. Treasury bonds Level 1 4,830 (2) 4,828 — 4,828 Agency bonds Level 2 4,828 (3) 4,825 — 4,825 Total investments $ 65,980 $ (5) $ 159,004 $ 149,351 $ 9,653

Accounting Policies - Additiona

Accounting Policies - Additional Information (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2024 USD ($) agency	Mar. 31, 2023 USD ($)	Dec. 31, 2023 USD ($)
Summary Of Significant Accounting Policies [Line Items]
Number of government agencies | agency	3
Allowance for doubtful accounts	$ 2,265		$ 2,606
Capitalized contract cost, amortization period (in years)	5 years
Commission expense	$ 11,400	$ 11,000
Severance costs		$ 4,200
Computer software and hardware
Summary Of Significant Accounting Policies [Line Items]
Property, plant and equipment, useful life	3 years
Internally developed software
Summary Of Significant Accounting Policies [Line Items]
Property, plant and equipment, useful life	3 years
Equipment
Summary Of Significant Accounting Policies [Line Items]
Property, plant and equipment, useful life	5 years
Office furniture and fixtures
Summary Of Significant Accounting Policies [Line Items]
Property, plant and equipment, useful life	10 years
Sales Revenue, Net | Customer Concentration Risk | Government Agencies
Summary Of Significant Accounting Policies [Line Items]
Concentration risk percentage	21.70%	20.50%
Sales Revenue, Net | Customer Concentration Risk | Federal Government Agencies
Summary Of Significant Accounting Policies [Line Items]
Concentration risk percentage	4.50%	4.20%
Sales Revenue, Net | Customer Concentration Risk | Foreign Customers
Summary Of Significant Accounting Policies [Line Items]
Concentration risk percentage	37.20%	33.40%
Accounts Receivable | Customer Concentration Risk | Customer One
Summary Of Significant Accounting Policies [Line Items]
Concentration risk percentage	12%

Accounting Policies - Cash, Cas

Accounting Policies - Cash, Cash Equivalents, and Restricted Cash (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023	Mar. 31, 2023	Dec. 31, 2022
Accounting Policies [Abstract]
Cash and cash equivalents	$ 170,108	$ 149,351	$ 198,679	$ 148,132
Restricted cash, current	0	0	2,280	2,249
Total cash, cash equivalents, and restricted cash	$ 170,108	$ 149,351	$ 200,959	$ 150,381

Revenue - Revenue by Services (

Revenue - Revenue by Services (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Disaggregation of Revenue [Line Items]
Total revenue	$ 149,835	$ 135,235
Subscriptions
Disaggregation of Revenue [Line Items]
Total revenue	117,694	98,957
Cloud subscriptions
Disaggregation of Revenue [Line Items]
Total revenue	86,603	69,692
Term license subscriptions
Disaggregation of Revenue [Line Items]
Total revenue	23,771	23,151
Maintenance and support
Disaggregation of Revenue [Line Items]
Total revenue	7,320	6,114
Professional services
Disaggregation of Revenue [Line Items]
Total revenue	$ 32,141	$ 36,278

Revenue - Additional Informatio

Revenue - Additional Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023	Dec. 31, 2022
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Contract assets balances	$ 10,371	$ 13,883	$ 12,052	$ 12,540
Revenue recognized	94,200	$ 85,400
Performance obligations	468,300
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-04-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Performance obligations	$ 296,300
Revenue, remaining performance obligation, period (in months)	12 months
Minimum
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Cloud subscriptions contract term	1 year
Maximum
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Cloud subscriptions contract term	3 years

Revenue - Schedule of Contract

Revenue - Schedule of Contract Asset and Contract Liability (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023	Mar. 31, 2023	Dec. 31, 2022
Revenue from Contract with Customer [Abstract]
Contract assets, current	$ 10,371	$ 12,052	$ 13,883	$ 12,540
Contract assets, non-current	1,192	915	1,051	1,720
Total contract assets	11,563	12,967	14,934	14,260
Deferred revenue, current	220,943	235,992	193,902	194,768
Deferred revenue, non-current	5,216	4,700	4,750	5,556
Total contract liabilities	$ 226,159	$ 240,692	$ 198,652	$ 200,324

Leases - Additional Information

Leases - Additional Information (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Leases [Abstract]
Renewal term	10 years
Sublease income	$ 0.3	$ 0.3
Reimbursements received for tenant improvements	$ 0	$ 0.6

Leases - Components of Lease Ex

Leases - Components of Lease Expense (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Leases [Abstract]
Operating lease cost	$ 2,411	$ 2,146
Short-term lease cost	332	365
Variable lease cost	1,313	1,026
Total	$ 4,056	$ 3,537

Leases - Supplemental Balance S

Leases - Supplemental Balance Sheet Information (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Leases [Abstract]
Right-of-use assets for operating leases	$ 39,074	$ 39,975
Operating lease liabilities, current	12,219	11,698
Operating lease liabilities, net of current portion	57,357	59,067
Total operating lease liabilities	$ 69,576	$ 70,765
Weighted average remaining lease term (in years)	7 years 2 months 12 days	7 years 4 months 24 days
Weighted average discount rate	9.40%	9.40%

Leases - Supplemental Cash Flow

Leases - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Leases [Abstract]
Operating cash outflows for operating leases	$ 2,643	$ 1,132
Amortization of operating lease right-of-use assets	783	652
Interest expense on operating lease liabilities	$ 1,629	$ 1,495

Leases - Maturities of Lease Li

Leases - Maturities of Lease Liabilities (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Operating Leases
2024 (excluding the three months ended March 31, 2024)	$ 9,521
2025	12,963
2026	13,283
2027	13,535
2028	12,450
Thereafter	34,840
Total lease payments	96,592
Less: imputed interest	(27,016)
Total	$ 69,576	$ 70,765

Goodwill and Intangible Asset_2

Goodwill and Intangible Assets - Schedule of Goodwill (Details) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2024	Dec. 31, 2023
Goodwill [Roll Forward]
Beginning balance	$ 27,106	$ 26,349
Foreign currency translation adjustments	(588)	757
Ending balance	$ 26,518	$ 27,106

Goodwill and Intangible Asset_3

Goodwill and Intangible Assets - Schedule of Finite-Lived Intangible Assets (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Acquired Finite-Lived Intangible Assets [Line Items]
Intangible assets, gross	$ 7,866	$ 8,041
Less: accumulated amortization	(4,432)	(4,152)
Intangible assets, net	3,434	3,889
Developed technology
Acquired Finite-Lived Intangible Assets [Line Items]
Intangible assets, gross	6,937	7,091
Customer relationships
Acquired Finite-Lived Intangible Assets [Line Items]
Intangible assets, gross	$ 929	$ 950

Goodwill and Intangible Asset_4

Goodwill and Intangible Assets - Additional Information (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Acquired Finite-Lived Intangible Assets [Line Items]
Amortization of intangible assets	$ 0.4	$ 0.4
Developed technology
Acquired Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible asset, useful life	2 years 3 months 18 days
Customer relationships
Acquired Finite-Lived Intangible Assets [Line Items]
Finite-lived intangible asset, useful life	7 years

Goodwill and Intangible Asset_5

Goodwill and Intangible Assets - Schedule of Future Amortization Expense (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Goodwill and Intangible Assets Disclosure [Abstract]
2024 (excluding the three months ended March 31, 2024)	$ 1,110
2025	1,178
2026	758
2027	93
2028	93
Thereafter	202
Intangible assets, net	$ 3,434	$ 3,889

Property and Equipment, net - S

Property and Equipment, net - Schedule of Property and Equipment (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 69,462	$ 67,823
Less: accumulated depreciation	(26,904)	(25,141)
Property and equipment, net	42,558	42,682
Leasehold improvements
Property, Plant and Equipment [Line Items]
Property and equipment, gross	54,148	53,313
Office furniture and fixtures
Property, Plant and Equipment [Line Items]
Property and equipment, gross	4,437	3,825
Computer software and hardware
Property, Plant and Equipment [Line Items]
Property and equipment, gross	10,378	10,491
Internally developed software
Property, Plant and Equipment [Line Items]
Property and equipment, gross	306	0
Equipment
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 193	$ 194

Property and Equipment, net - A

Property and Equipment, net - Additional Information (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Property, Plant and Equipment [Abstract]
Depreciation expense	$ 2	$ 2
Disposal of property plant and equipment	$ 0	$ 1.4

Accrued Expenses (Details)

Accrued Expenses (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Payables and Accruals [Abstract]
Hosting costs	$ 3,600	$ 2,973
Legal costs	252	103
Marketing and tradeshow expenses	917	685
Third party license fees	726	678
Contract labor costs	1,132	600
Reimbursable employee expenses	1,128	880
Taxes payable	760	1,261
Audit and tax expenses	1,303	1,499
Capital expenditures	476	644
Other accrued expenses	1,958	1,723
Total	$ 12,252	$ 11,046

Debt - Additional Information (

Debt - Additional Information (Details) - USD ($)	3 Months Ended
	Mar. 31, 2024	Dec. 31, 2023
Line of Credit Facility [Line Items]
Outstanding letters of credit	$ 11,800,000
Letter of Credit | Revolving Credit Facility
Line of Credit Facility [Line Items]
Line of credit facility, maximum borrowing capacity	20,000,000
Swingline Sub-facility | Revolving Credit Facility
Line of Credit Facility [Line Items]
Line of credit facility, maximum borrowing capacity	$ 10,000,000
Secured Debt | Term Loan Facility
Line of Credit Facility [Line Items]
Debt term	5 years
Aggregate principal amount	$ 200,000,000
Secured Debt | Term Loan Facility | Base Rate
Line of Credit Facility [Line Items]
Interest rate margin (as a percent)	0.50%
Line of Credit | Base Rate | Minimum
Line of Credit Facility [Line Items]
Interest rate margin (as a percent)	1.50%
Line of Credit | Base Rate | Minimum | EBITDA
Line of Credit Facility [Line Items]
Interest rate margin (as a percent)	0.50%
Line of Credit | Base Rate | Maximum
Line of Credit Facility [Line Items]
Interest rate margin (as a percent)	2.50%
Line of Credit | Base Rate | Maximum | EBITDA
Line of Credit Facility [Line Items]
Interest rate margin (as a percent)	2.50%
Line of Credit | SOFR | Minimum
Line of Credit Facility [Line Items]
Interest rate margin (as a percent)	2.50%
Line of Credit | SOFR | Minimum | EBITDA
Line of Credit Facility [Line Items]
Interest rate margin (as a percent)	1.50%
Line of Credit | SOFR | Maximum
Line of Credit Facility [Line Items]
Interest rate margin (as a percent)	3.50%
Line of Credit | SOFR | Maximum | EBITDA
Line of Credit Facility [Line Items]
Interest rate margin (as a percent)	3.50%
Line of Credit | Revolving Credit Facility
Line of Credit Facility [Line Items]
Line of credit facility, maximum borrowing capacity	$ 100,000,000
Long-term debt	$ 62,000,000	$ 62,000,000

Debt - Outstanding Long-term De

Debt - Outstanding Long-term Debt (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Line of Credit Facility [Line Items]
Less: Debt issuance costs	$ (1,440)	$ (1,224)
Total debt, net of debt issuance costs	255,123	206,589
Debt, current	7,098	66,368
Long-term debt	248,025	140,221
Line of Credit | Revolving Credit Facility
Line of Credit Facility [Line Items]
Long-term debt	62,000	62,000
Secured Debt | Secured Term Loan Facility
Line of Credit Facility [Line Items]
Long-term debt	$ 194,563	$ 145,813

Income Taxes (Details)

Income Taxes (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Income Taxes [Line Items]
Effective tax rate (as a percent)	1.40%	(3.20%)
Net unrecognized tax benefits which would impact effective tax rate if recognized	$ 6.5
Minimum | Subsidiaries
Income Taxes [Line Items]
Effective tax rate (as a percent)	0%
Maximum | Subsidiaries
Income Taxes [Line Items]
Effective tax rate (as a percent)	35%

Stock-Based Compensation - Addi

Stock-Based Compensation - Additional Information (Details) $ in Millions	3 Months Ended
	Mar. 31, 2024 USD ($)
Non-vested restricted stock units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total unrecognized compensation cost related to unvested restricted stock units	$ 42.6
Weighted average remaining vesting period	1 year 3 months 18 days
Chief Executive Officer
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Compensation cost related to nonvested stock options not yet recognized	$ 9.7
Chief Executive Officer | Stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation cost related to nonvested stock option recognized over weighted average period (in years)	2 years

Stock-Based Compensation - Sche

Stock-Based Compensation - Schedule of Stock-based Compensation Expense Included in Condensed Consolidated Statements of Operations (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation expense	$ 10,606	$ 11,056
Cost of revenue | Subscriptions
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation expense	213	272
Cost of revenue | Professional services
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation expense	1,578	1,591
Sales and marketing
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation expense	2,527	2,445
Research and development
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation expense	3,001	3,626
General and administrative
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation expense	$ 3,287	$ 3,122

Basic and Diluted Loss per Sh_3

Basic and Diluted Loss per Share (Details) - shares	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Stock options
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Potentially dilutive securities outstanding (in shares)	2,555,509	2,678,476
Non-vested restricted stock units
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Potentially dilutive securities outstanding (in shares)	1,183,674	1,190,286

Commitments, Contingencies, a_2

Commitments, Contingencies, and Other Matters (Details) - USD ($)				1 Months Ended	3 Months Ended
	Sep. 01, 2023	Sep. 15, 2022	May 10, 2022	Mar. 31, 2024	Mar. 31, 2024	Mar. 31, 2023	Feb. 29, 2024	Jul. 31, 2021
Loss Contingencies [Line Items]
Purchase obligation								$ 131,000,000
Purchase obligation, year three								28,000,000
Purchase obligation, year four								28,000,000
Purchase obligation, year five								$ 28,000,000
Payments for purchase obligation					$ 10,300,000	$ 9,400,000
Authorized to repurchase							$ 50,000,000
Treasury stock, shares (in shares)				1,300,000
Average share price (in usd per share)				$ 37.86
Repurchase of common stock				$ 50,000,000	$ 50,019,000
Common stock, shares outstanding (in shares)				72,200,000	72,200,000
Treasury stock, shares (in shares)				1,320,531	1,320,531
Pegasystems Litigation
Loss Contingencies [Line Items]
JPI, threshold amount	$ 500,000,000
JPI cost	$ 57,300,000
Appeal process, period				3 years	3 years
JPI expense					$ 4,500,000
JPI current				$ 18,100,000	18,100,000
JPI noncurrent				$ 28,700,000	$ 28,700,000
Pegasystems Litigation | Misappropriation of Trade Secrets
Loss Contingencies [Line Items]
Amount awarded in settlement		$ 2,036,000,000	$ 2,036,000,000
Pegasystems Litigation | Violation of Virginia Computer Crimes Act
Loss Contingencies [Line Items]
Amount awarded in settlement			$ 1
Pegasystems Litigation | Attorney's Fees Associated
Loss Contingencies [Line Items]
Amount awarded in settlement		23,600,000
Pegasystems Litigation | Statutory Post Judgement Interest On Judgmental
Loss Contingencies [Line Items]
Amount awarded in settlement		$ 122,000,000
Interest on damages awarded (as a percentage)		6%
Youyong Zou Litigation
Loss Contingencies [Line Items]
Amount awarded in settlement		$ 5,000,000

Segment and Geographic Inform_3

Segment and Geographic Information - Schedule of Revenue by Geography (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Revenues from External Customers and Long-Lived Assets [Line Items]
Total revenue	$ 149,835	$ 135,235
Domestic
Revenues from External Customers and Long-Lived Assets [Line Items]
Total revenue	94,113	90,005
International
Revenues from External Customers and Long-Lived Assets [Line Items]
Total revenue	$ 55,722	$ 45,230

Segment and Geographic Inform_4

Segment and Geographic Information - Additional Information (Details) - USD ($) $ in Millions	Mar. 31, 2024	Dec. 31, 2023
United States
Revenues from External Customers and Long-Lived Assets [Line Items]
Long-lived assets	$ 33	$ 34
International
Revenues from External Customers and Long-Lived Assets [Line Items]
Long-lived assets	$ 13	$ 12.6

Investments and Fair Value Me_3

Investments and Fair Value Measurements - Components of Investments (Details) $ in Thousands	Dec. 31, 2023 USD ($)
Debt Securities, Available-for-sale [Line Items]
Cost Basis	$ 65,980
Unrealized Gains (Losses)	(5)
Total investments	159,004
Cash and Cash Equivalents
Debt Securities, Available-for-sale [Line Items]
Total investments	149,351
Short-term Investments and Marketable Securities
Debt Securities, Available-for-sale [Line Items]
Total investments	9,653
Level 1
Debt Securities, Available-for-sale [Line Items]
Cash	93,029
Level 1 | Money market fund
Debt Securities, Available-for-sale [Line Items]
Cost Basis	56,322
Unrealized Gains (Losses)	0
Investments, Fair Value	56,322
Level 1 | U.S. Treasury bonds
Debt Securities, Available-for-sale [Line Items]
Cost Basis	4,830
Unrealized Gains (Losses)	(2)
Investments, Fair Value	4,828
Level 1 | Cash and Cash Equivalents
Debt Securities, Available-for-sale [Line Items]
Cash	93,029
Level 1 | Cash and Cash Equivalents | Money market fund
Debt Securities, Available-for-sale [Line Items]
Investments, Fair Value	56,322
Level 1 | Cash and Cash Equivalents | U.S. Treasury bonds
Debt Securities, Available-for-sale [Line Items]
Investments, Fair Value	0
Level 1 | Short-term Investments and Marketable Securities | Money market fund
Debt Securities, Available-for-sale [Line Items]
Investments, Fair Value	0
Level 1 | Short-term Investments and Marketable Securities | U.S. Treasury bonds
Debt Securities, Available-for-sale [Line Items]
Investments, Fair Value	4,828
Level 2 | Agency bonds
Debt Securities, Available-for-sale [Line Items]
Cost Basis	4,828
Unrealized Gains (Losses)	(3)
Investments, Fair Value	4,825
Level 2 | Cash and Cash Equivalents | Agency bonds
Debt Securities, Available-for-sale [Line Items]
Investments, Fair Value	0
Level 2 | Short-term Investments and Marketable Securities | Agency bonds
Debt Securities, Available-for-sale [Line Items]
Investments, Fair Value	$ 4,825

Investments and Fair Value Me_4

Investments and Fair Value Measurements - Additional Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023	Dec. 31, 2022
Debt Securities, Available-for-sale [Line Items]
Cash and cash equivalents	$ 170,108	$ 198,679	$ 149,351	$ 148,132
Investment income, interest	1,900	$ 2,100
Level 1
Debt Securities, Available-for-sale [Line Items]
Cash and cash equivalents	170,100
Checking Or Overnight Repurchase Investment Accounts | Level 1
Debt Securities, Available-for-sale [Line Items]
Cash and cash equivalents	86,000
Money market fund | Level 1
Debt Securities, Available-for-sale [Line Items]
Cash and cash equivalents	$ 84,100