Jamf Holding (JAMF) 10-Q 2021 Q1 Quarterly report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the quarterly period ended March 31, 2021
	OR
☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from                 to

Commission File Number: 001-39399

JAMF HOLDING CORP.

(Exact name of registrant as specified in its charter)

Delaware (State or Other Jurisdiction of Incorporation or Organization)		82-3031543 (I.R.S. Employer Identification No.)
	100 Washington Ave S, Suite 1100 Minneapolis, MN 55401 (Address of principal executive offices)

(612) 605-6625

(Registrant’s telephone number, including area code)

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

Title of each class	Trading symbol	Name of each exchange on which registered
Common Stock, $0.001 par value per share	JAMF	The NASDAQ Stock Market LLC

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

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

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐	Accelerated filer☐	Non-accelerated filer ☒
Smaller reporting company ☐		Emerging growth company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.   ☐

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

On May 7, 2021, the Registrant had 117,725,132 shares of common stock, $0.001 par value, outstanding.

Jamf Holding Corp.

INDEX

		PAGE
PART I.	FINANCIAL INFORMATION
Item 1.	Financial Statements (unaudited)	3
	Consolidated Balance Sheets as of March 31, 2021 and December 31, 2020	3
	Consolidated Statements of Operations for the Three Months Ended March 31, 2021 and 2020	4
	Consolidated Statements of Stockholders’ Equity for the Three Months Ended March 31, 2021 and 2020	5
	Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2021 and 2020	6
	Notes to Consolidated Financial Statements	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	25
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	42
Item 4.	Controls and Procedures	42
PART II.	OTHER INFORMATION
Item 1.	Legal Proceedings	43
Item 1A.	Risk Factors	43
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	45
Item 3.	Defaults Upon Senior Securities	45
Item 4.	Mine Safety Disclosures	45
Item 5.	Other Information	45
Item 6.	Exhibits	46
	Signatures	47

2

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

JAMF HOLDING CORP.

CONSOLIDATED BALANCE SHEETS

(In thousands, except share and per share amounts)

	March 31, 2021		December 31, 2020
		(unaudited)
Assets
Current assets:
Cash and cash equivalents	$	196,190	$	194,868
Trade accounts receivable, net of allowances of $603 and $530 at March 31, 2021 and December 31, 2020, respectively		75,882		69,056
Income taxes receivable		632		632
Deferred contract costs		11,155		9,959
Prepaid expenses		15,009		13,283
Other current assets		2,325		1,113
Total current assets		301,193		288,911
Equipment and leasehold improvements, net		16,965		12,755
Goodwill		541,850		541,480
Other intangible assets, net		197,504		202,878
Deferred contract costs		28,774		26,770
Other assets		28,898		5,359
Total assets	$	1,115,184	$	1,078,153
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	5,744	$	6,967
Accrued liabilities		28,131		31,574
Income taxes payable		1,153		713
Deferred revenues		167,868		160,443
Total current liabilities		202,896		199,697
Deferred revenues, noncurrent		53,711		45,507
Deferred tax liability, net		5,475		6,422
Other liabilities		33,839		11,046
Total liabilities		295,921		262,672
Commitments and contingencies (Note 8)
Stockholders’ equity:
Preferred stock, $0.001 par value, 50,000,000 shares authorized at March 31, 2021 and December 31, 2020; no shares issued and outstanding at March 31, 2021 and December 31, 2020		—		—
Common stock, $0.001 par value, 500,000,000 shares authorized at March 31, 2021 and December 31, 2020; 117,705,895 and 116,992,472 shares issued and outstanding at March 31, 2021 and December 31, 2020, respectively		118		117
Additional paid‑in capital		909,966		903,116
Accumulated deficit		(90,821)		(87,752)
Total stockholders’ equity		819,263		815,481
Total liabilities and stockholders’ equity	$	1,115,184	$	1,078,153

The accompanying notes are an integral part of these consolidated financial statements.

3

JAMF HOLDING CORP.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except share and per share amounts)

(unaudited)

	Three Months Ended March 31,
	2021		2020
Revenue:
Subscription	$	74,923	$	54,618
Services		4,003		4,010
License		2,242		1,762
Total revenue		81,168		60,390
Cost of revenue:
Cost of subscription (exclusive of amortization expense shown below)		12,014		9,248
Cost of services (exclusive of amortization expense shown below)		2,465		3,086
Amortization expense		2,777		2,677
Total cost of revenue		17,256		15,011
Gross profit		63,912		45,379
Operating expenses:
Sales and marketing		29,332		22,282
Research and development		15,626		12,617
General and administrative		16,105		11,289
Amortization expense		5,627		5,674
Total operating expenses		66,690		51,862
Loss from operations		(2,778)		(6,483)
Interest expense, net		(55)		(4,778)
Foreign currency transaction loss		(171)		(304)
Other income, net		—		55
Loss before income tax (provision) benefit		(3,004)		(11,510)
Income tax (provision) benefit		(65)		3,220
Net loss	$	(3,069)	$	(8,290)
Net loss per share, basic and diluted	$	(0.03)	$	(0.08)
Weighted-average shares used to compute net loss per share, basic and diluted		117,386,322		102,860,545

The accompanying notes are an integral part of these consolidated financial statements.

4

JAMF HOLDING CORP.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(In thousands, except share amounts)

(unaudited)

	Stock Class			Additional
	Common			Paid‑In		Accumulated		Stockholders’
	Shares	Amount		Capital		Deficit		Equity
Three Months Ended March 31, 2021:
Balance, December 31, 2020	116,992,472	$	117	$	903,116	$	(87,752)	$	815,481
Exercise of stock options	713,423		1		4,018		—		4,019
Share-based compensation	—		—		2,832		—		2,832
Net loss	—		—		—		(3,069)		(3,069)
Balance, March 31, 2021	117,705,895	$	118	$	909,966	$	(90,821)	$	819,263

Three Months Ended March 31, 2020:

Balance, December 31, 2019	102,843,612	$	103	$	568,756	$	(64,981)	$	503,878
Exercise of stock options	18,792		—		103		—		103
Share-based compensation	—		—		811		—		811
Net loss	—		—		—		(8,290)		(8,290)
Balance, March 31, 2020	102,862,404	$	103	$	569,670	$	(73,271)	$	496,502

The accompanying notes are an integral part of these consolidated financial statements.

5

JAMF HOLDING CORP.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(unaudited)

	Three Months Ended March 31,
	2021		2020
Cash flows from operating activities
Net loss	$	(3,069)	$	(8,290)
Adjustments to reconcile net loss to cash provided by (used in) operating activities:
Depreciation and amortization expense		9,784		9,586
Amortization of deferred contract costs		3,296		2,090
Amortization of debt issuance costs		69		279
Non-cash lease expense		1,267		—
Provision for bad debt expense and returns		159		240
Share‑based compensation		2,832		811
Deferred tax benefit		(758)		(2,564)
Adjustment to contingent consideration		300		—
Other		62		10
Changes in operating assets and liabilities:
Trade accounts receivable		(7,066)		220
Income tax receivable/payable		463		(789)
Prepaid expenses and other assets		(3,317)		(2,255)
Deferred contract costs		(6,496)		(4,788)
Accounts payable		(1,191)		(1,989)
Accrued liabilities		(7,694)		(4,928)
Deferred revenue		15,472		5,025
Other liabilities		(90)		(13)
Net cash provided by (used in) operating activities		4,023		(7,355)
Cash flows from investing activities
Acquisition, net of cash acquired		(3,041)		—
Purchases of equipment and leasehold improvements		(3,290)		(1,039)
Proceeds from sale of equipment and leasehold improvements		12		—
Net cash used in investing activities		(6,319)		(1,039)
Cash flows from financing activities
Cash paid for offering costs		—		(1,465)
Proceeds from the exercise of stock options		4,019		103
Net cash provided by (used in) financing activities		4,019		(1,362)
Effect of exchange rate changes on cash and cash equivalents		(401)		—
Net increase (decrease) in cash and cash equivalents		1,322		(9,756)
Cash and cash equivalents, beginning of period		194,868		32,433
Cash and cash equivalents, end of period	$	196,190	$	22,677
Supplemental disclosures of cash flow information:
Cash paid for interest	$	3	$	4,734
Cash paid for income taxes, net of refunds		351		216
Offering costs accrued but not paid		—		2,378
Operating lease assets obtained in exchange for operating lease liabilities		(19)		—

The accompanying notes are an integral part of these consolidated financial statements.

6

JAMF HOLDING CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

Note 1. Basis of presentation and description of business

Description of business

Jamf Holding Corp. and its wholly owned subsidiaries, collectively, are referred to as the “Company,” “we,” “us” or “our.” We are the standard in Apple Enterprise Management, and our cloud software platform is the only vertically-focused Apple infrastructure and security platform of scale in the world. We help organizations connect, manage and protect Apple products, apps and corporate resources in the cloud without ever having to touch the devices. With our products, Apple devices can be deployed to employees brand new in the shrink-wrapped box, automatically set up and personalized at first power-on and continuously administered throughout the life of the device. Our customers are located throughout the world.

Vista Equity Partners acquisition

On November 13, 2017, Vista Equity Partners (“Vista”) acquired a majority share of all the issued and outstanding shares of the Company at the purchase price of $733.8 million (the “Vista Acquisition”). As of March 31, 2021, funds controlled by Vista owned approximately 61.9% of our outstanding common stock. As a result, we are a “controlled company” under NASDAQ Global Select Market (“NASDAQ”) corporate governance rules.

Emerging growth company status

We are an emerging growth company as defined in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act, until such time as those standards apply to private companies.

We have elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date that it is (i) no longer an emerging growth company or (ii) affirmatively and irrevocably opt out of the extended transition period provided in the JOBS Act. As a result, our consolidated financial statements may not be comparable to companies that comply with the new or revised accounting pronouncements as of public company effective dates.

We will remain an emerging growth company for the first five fiscal years after the completion of our initial public offering (“IPO”), unless one of the following occurs: (i) our total annual gross revenue is at least $1.07 billion, (ii) we have issued more than $1.0 billion in non-convertible debt securities during the prior three year period, or (iii) we are deemed to be a large accelerated filer, which means the market value of our common stock that is held by non-affiliates exceeds $700.0 million as of the prior June 30.

Basis of presentation

The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and include all adjustments necessary for the fair presentation of the consolidated financial position, results of operations, and cash flows of the Company.

Certain reclassifications of prior period amounts have been made to conform to the current presentation. In the fourth quarter of 2020, the Company reclassified on-premise subscription revenue from license revenue to subscription revenue in the consolidated statements of operations on a retroactive basis. The amount reclassified for the three months ended March 31, 2020 was $4.5 million. The revised presentation is consistent with our disaggregated revenue disclosure and is more consistent with how investors and other users of the financial statements evaluate overall subscription revenue. The reclassification had no impact on total revenue.

7

JAMF HOLDING CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(unaudited)

In 2020, the Company reclassified cash paid for offering costs of $1.5 million during the three months ended March 31, 2020 from operating activities to financing activities in the consolidated statements of cash flows as a result of the completion of our IPO in July 2020. The impact of the reclassification was not material to current or prior period financial statements.

Unaudited Interim Consolidated Financial Information

The accompanying interim consolidated balance sheet as of March 31, 2021, the consolidated statements of operations, of stockholders’ equity and of cash flows for the three months ended March 31, 2021 and 2020 and the related footnote disclosures are unaudited. These unaudited interim consolidated financial statements have been prepared on the same basis as the annual consolidated financial statements and, in management’s opinion, include all adjustments necessary for the fair presentation of the consolidated financial position, results of operations, and cash flows of the Company. All adjustments made were of a normal recurring nature. The results for the three months ended March 31, 2021 are not necessarily indicative of the results to be expected for the year ending December 31, 2021 or for any future period.

Use of estimates

The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities as of the reporting date, and the reported amounts of revenues and expenses during the reporting period. These estimates are based on management’s best knowledge of current events and actions that the Company may undertake in the future and include, but are not limited to, revenue recognition, stock-based compensation, commissions, goodwill and accounting for income taxes. Actual results could differ from those estimates.

Segment and geographic information

Our chief operating decision maker (“CODM”) is our Chief Executive Officer, who reviews financial information presented on a consolidated basis for purposes of making operating decisions, assessing financial performance and allocating resources. We operate our business as 1 operating segment and therefore we have 1 reportable segment.

Revenue by geographic region as determined based on the end user customer address was as follows:

	Three Months Ended March 31,
	2021		2020
	(in thousands)
The Americas	$	61,258	$	47,026
Europe, the Middle East, India, and Africa		14,523		10,121
Asia Pacific		5,387		3,243
	$	81,168	$	60,390

Note 2. Summary of significant accounting policies

The Company’s significant accounting policies are discussed in Note 2 to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020. Except for the accounting policies for leases that were updated as a result of adopting the new accounting standard, there have been no significant changes to these policies that have had a material impact on the Company’s consolidated financial statements and related notes for the three months ended March 31, 2021. The following describes the impact of certain policies.

8

JAMF HOLDING CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(unaudited)

Revenue recognition

The Company applies ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”) and follows a five-step model to determine the appropriate amount of revenue to be recognized in accordance with ASC 606.

Disaggregation of Revenue

The Company separates revenue into subscription and non-subscription categories to disaggregate those revenues that are term-based and renewable from those that are one-time in nature. Revenue from subscription and non-subscription contractual arrangements are as follows:

	Three Months Ended March 31,
	2021		2020
	(in thousands)
SaaS subscription and support and maintenance	$	66,669	$	50,078
On‑premise subscription		8,254		4,540
Subscription revenue		74,923		54,618
Professional services		4,003		4,010
Perpetual licenses		2,242		1,762
Non‑subscription revenue		6,245		5,772
Total revenue	$	81,168	$	60,390

Contract Balances

If revenue is recognized in advance of the right to invoice, a contract asset is recorded. The balances of contract assets were $1.2 million and $0.9 million as of March 31, 2021 and December 31, 2020, respectively.

Contract liabilities consist of customer billings in advance of revenue being recognized. The Company invoices its customers for subscription, support and maintenance and services in advance.

Changes in contract liabilities, including revenue earned during the period from the beginning contract liability balance and new deferrals of revenue during the period, were as follows:

	Three Months Ended March 31,
	2021		2020
	(in thousands)
Balance, beginning of the period	$	205,950	$	140,710
Revenue earned		(60,925)		(47,723)
Deferral of revenue		76,554		52,748
Balance, end of the period	$	221,579	$	145,735

There were no significant changes to our contract assets and liabilities during the three months ended March 31, 2021 and 2020 outside of our sales activities.

Remaining Performance Obligations

Revenue allocated to remaining performance obligations represents contracted revenue that has not yet been recognized, which includes deferred revenue and noncancelable amounts to be invoiced. As of March 31, 2021 and December 31, 2020, the Company had $243.1 million and $224.5 million, respectively, of remaining performance

9

JAMF HOLDING CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(unaudited)

obligations, with 78% and 80%, respectively, expected to be recognized as revenue over the succeeding 12 months, and the remainder expected to be recognized over the three years thereafter.

Deferred Contract Costs

Sales commissions as well as associated payroll taxes and retirement plan contributions (together, contract costs) that are incremental to the acquisition of customer contracts are capitalized using a portfolio approach as deferred contract costs in the consolidated balance sheets when the period of benefit is determined to be greater than one year.

Total amortization of contract costs for the three months ended March 31, 2021 and 2020 was $3.3 million and $2.1 million, respectively.

The Company periodically reviews these deferred costs to determine whether events or changes in circumstances have occurred that could affect the period of benefit of these deferred contract costs. There were 0 impairment losses recorded during the three months ended March 31, 2021 and 2020.

Concentration of Credit Risk

For the three months ended March 31, 2021, the Company had 1 distributor that accounted for more than 10% of total net revenues. Total receivables related to this distributor were $17.3 million as of March 31, 2021. For the three months ended March 31, 2020, the Company had 2 distributors that accounted for more than 10% of total net revenues. Total receivables related to these distributors were $19.8 million as of December 31, 2020.

No single end customer accounted for more than 10% of total revenue for the three months ended March 31, 2021 and 2020.

Recently issued accounting pronouncements not yet adopted

From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (“FASB”) or other standard setting bodies and adopted by us as of the specified effective date. Unless otherwise discussed, the impact of recently issued standards that are not yet effective will not have a material impact on our financial position or results of operations upon adoption.

Financial Instruments — Credit Losses

In June 2016, the FASB issued Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”), which introduces a model based on expected losses to estimate credit losses for most financial assets and certain other instruments. In November 2019, the FASB issued ASU No. 2019-10 Financial Instruments — Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842): Effective Dates (“ASU 2019-10”). The update allows the extension of the initial effective date for entities which have not yet adopted ASU No. 2016-02, Leases (Topic 842) (“ASU 2016-02”). The standard is effective for annual reporting periods beginning after December 15, 2022, with early adoption permitted. Entities will apply the standard’s provisions by recording a cumulative-effect adjustment to retained earnings. The Company has not yet adopted ASU 2016-13 and is currently evaluating the effect the standard will have on its consolidated financial statements.

Reference Rate Reform

In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“ASU 2020-04”), which provides entities with temporary

10

JAMF HOLDING CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(unaudited)

optional financial reporting alternatives to ease the potential burden in accounting for reference rate reform and includes a provision that allows entities to account for a modified contract as a continuation of an existing contract. ASU 2020-04 is effective upon issuance and can be applied through December 31, 2022. The adoption of this standard is not expected to have a material impact on the Company’s consolidated financial statements.

Adoption of new accounting pronouncements

Leases

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) to increase transparency and comparability among organizations related to their leasing arrangements. The update requires lessees to recognize most leases on their balance sheets, with the exception of short-term leases if a policy election is made, while recognizing lease expense on their income statements in a manner similar to current GAAP. The guidance also requires entities to disclose key quantitative and qualitative information about its leasing arrangements. The Company adopted the new lease standard on January 1, 2021 using the optional transition method to the modified retrospective approach. Under this transition provision, results for reporting periods beginning on January 1, 2021 are presented under ASC Topic 842, Leases (“ASC 842”) while prior period amounts continue to be reported and disclosed in accordance with the Company’s historical accounting treatment under ASC Topic 840, Leases (“ASC 840”).

To reduce the burden of adoption and ongoing compliance with ASC 842, a number of practical expedients and policy elections are available under the new guidance. The Company elected the “package of practical expedients” permitted under the transition guidance, which among other things, did not require reassessment of whether contracts entered into prior to adoption are or contain leases, and allowed carryforward of the historical lease classification for existing leases. The Company has not elected to adopt the “hindsight” practical expedient, and therefore measured the right-of-use (“ROU”) asset and lease liability using the remaining portion of the lease term at adoption on January 1, 2021.

The Company made an accounting policy election under ASC 842 not to recognize ROU assets and lease liabilities for leases with a term of twelve months or less. For all other leases, the Company recognizes ROU assets and lease liabilities based on the present value of lease payments over the lease term at the commencement date of the lease (or January 1, 2021 for existing leases upon the adoption of ASC 842). The ROU assets also include any initial direct costs incurred and lease payments made at or before the commencement date and are reduced by any lease incentives.

Future lease payments may include fixed rent escalation clauses or payments that depend on an index (such as the consumer price index). Subsequent changes to an index and other periodic market-rate adjustments to base rent are recorded in variable lease expense in the period incurred.

The Company has made an accounting policy election to account for lease and non-lease components in its contracts as a single lease component for all asset classes. The non-lease components typically represent additional services transferred to the Company, such as common area maintenance for real estate, which are variable in nature and recorded in variable lease expense in the period incurred.

The Company uses its incremental borrowing rate to determine the present value of lease payments as the Company’s leases do not have a readily determinable implicit discount rate. The incremental borrowing rate is the rate of interest the Company would have to pay to borrow on a collateralized basis over a similar term and amount in a similar economic environment. Judgement is applied in assessing factors such as Company specific credit risk, lease term, nature and quality of the underlying collateral, currency and economic environment in determining the incremental borrowing rate to apply to each lease.

11

JAMF HOLDING CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(unaudited)

Upon adoption, the Company recorded ROU assets and lease liabilities of approximately $25.0 million and $28.6 million, respectively, related to the Company’s operating leases. The adoption of the new lease standard did not materially impact our consolidated statements of operations or consolidated statements of cash flows. See Note 6 for more information.

Debt with Conversion and Other Options and Contracts in Entity’s Own Equity

In August 2020, the FASB issued ASU No. 2020-06, Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (“ASU 2020-06”), which simplifies the accounting for certain financial instruments with characteristics of liabilities and equity. Among other changes, the standard eliminates the beneficial conversion and cash conversion accounting models for convertible instruments. As a result, entities will account for a convertible debt instrument wholly as debt unless the instrument contains features that require bifurcation as a derivative in accordance with ASC Topic 815, Derivatives and Hedging, or a convertible debt instrument was issued at a substantial premium. In addition, the amendments also require the if-converted method to be applied for all convertible instruments when calculating diluted earnings per share. The standard is effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. Early adoption is permitted. The Company early adopted the new standard on January 1, 2021. The adoption of the standard did not have a material impact on the Company’s consolidated financial statements.

Note 3. Financial instruments fair value

We report financial assets and liabilities and nonfinancial assets and liabilities that are recognized or disclosed at fair value in the consolidated financial statements on a recurring basis in accordance with ASC Topic 820, Fair Value Measurement (“ASC 820”). ASC 820 defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities, which are required to be recorded at fair value, we consider the principal or most advantageous market in which we would transact and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability, such as inherent risk, transfer restrictions and credit risk.

ASC 820 also establishes a fair value hierarchy, which prioritizes the inputs to valuation techniques used to measure fair value into three levels. Fair value represents the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. GAAP established a hierarchy framework to classify the fair value based on the observability of significant inputs to the measurement. The levels of the fair value hierarchy are as follows:

Level 1: Fair value is determined using an unadjusted quoted price in an active market for identical assets or liabilities.

Level 2: Fair value is estimated using inputs other than quoted prices included within Level 1 that are observable, either directly or indirectly.

Level 3: Fair value is estimated using unobservable inputs that are significant to the fair value of the assets or liabilities.

The Company invests in money market funds and U.S. Treasuries with original or remaining maturities at the time of purchase of three months or less, which are measured and recorded at fair value on a recurring basis. Money market funds are valued based on quoted market prices in active markets and classified within Level 1 of the fair value

12

JAMF HOLDING CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(unaudited)

hierarchy. U.S. Treasuries include treasury bills that generally mature within 30 days and are classified within Level 1 of the fair value hierarchy. The fair value of these financial instruments were as follows:

	March 31, 2021
	Level 1		Level 2		Level 3			Total
	(in thousands)
Cash equivalents:
Money market funds	$	150,006	$	—	$	—	$	150,006
Total cash equivalents	$	150,006	$	—	$	—	$	150,006
	December 31, 2020
	Level 1		Level 2		Level 3			Total
	(in thousands)
Cash equivalents:
Money market funds	$	100,000	$	—	$	—	$	100,000
U.S. Treasuries		25,000		—		—		25,000
Total cash equivalents	$	125,000	$	—	$	—	$	125,000

The carrying value of accounts receivable and accounts payable approximate their fair value due to their short maturities and are excluded from the tables above.

Note 4. Acquisitions

cmdReporter

On February 26, 2021, the Company entered into an asset purchase agreement with cmdSecurity Inc. (“cmdSecurity”) to acquire certain cmdSecurity assets, including cmdReporter, a suite of security and compliance tools purpose-built for macOS. With cmdReporter, the Company will further extend the security capabilities of its expansive Apple Enterprise Management platform. cmdSecurity’s software complements the Company’s existing product offerings. The Company accounted for the acquisition by applying the acquisition method of accounting for business combinations in accordance with ASC Topic 805, Business Combinations (“ASC 805”). The final aggregate purchase price was approximately $3.4 million. This acquisition was funded by the Company’s cash on hand and includes future contingent consideration due to the sellers. The goodwill represents the excess of the purchase consideration over the fair value of the underlying net identifiable assets. The goodwill recognized in this acquisition is primarily attributable to the cmdSecurity assembled workforce and was not material. The acquired intangible assets and goodwill are deductible for income tax purposes.

At the time of the acquisition, the contingent consideration was valued at $0.4 million, which was based on the acquired business signing new business or renewing acquired contracts during the 90 days following the close of the acquisition. The estimated fair value of these contingent payments is determined using projected contract wins, which uses Level 3 inputs for fair value measurements, including assumptions about the probability of closing contracts based on their current stage in the sales process.

Substantially all of the purchase price consideration related to the fair value of the acquired separately identifiable intangibles assets, which related to acquired developed technology and in-process research and development (“IPR&D”). The fair value of the identifiable intangible assets was estimated using the replacement cost method, whereby the components of the acquired intangibles were reviewed to determine the cumulative cost of development for each component, inclusive of a developer’s profit and an entrepreneurial incentive. The cumulative cost of development was not discounted to account for obsolescence factor as the replacement cost accounted for present day development. The developed technology will be amortized over its estimated weighted-average useful life, which was determined to be

13

JAMF HOLDING CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(unaudited)

5.0 years. The IPR&D is an indefinite lived intangible asset that is not amortized, but will be evaluated at least annually for impairment. For more details on the intangible assets, see Note 5.

Acquisition-related expenses were expensed as incurred and totaled $0.1 million for the three months ended March 31, 2021. These expenses were recognized as acquisition costs in general and administrative expenses in the consolidated statement of operations.

The Company allocated the net purchase consideration to the net assets acquired based on their respective fair values at the time of the acquisition as follows (in thousands):

Cash consideration	$	3,041
Contingent consideration		359
Final aggregate purchase price	$	3,400
Intangible assets acquired:
Developed technology	$	2,630
IPR&D		400
Goodwill		370
Total purchase consideration	$	3,400

Digita Security LLC

In 2019, the Company recorded contingent consideration in connection with its purchase of the outstanding membership interests of Digita. The maximum contingent consideration is $15.0 million if the acquired business achieves certain revenue milestones by December 31, 2022. The estimated fair value of these contingent payments is determined using a Monte Carlo simulation model, which uses Level 3 inputs for fair value measurements, including assumptions about the probability of growth of subscription services and the related pricing of the services offered. During the three months ended March 31, 2021, the fair value of the contingent consideration was increased by $0.3 million, which was reflected in general and administrative expenses in the consolidated statement of operations. The adjustment for the three months ended March 31, 2021 primarily reflects an increase in the liability due to updated market assumptions. As of March 31, 2021 and December 31, 2020, the fair value of the contingent consideration was $8.5 million and $8.2 million, respectively, which is included in other liabilities in the consolidated balance sheets.

Note 5. Goodwill and other intangible assets

The change in the carrying amount of goodwill is as follows:

	Three Months Ended March 31,
	2021		2020
	(in thousands)
Goodwill, beginning of period	$	541,480	$	539,818
Goodwill acquired		370		—
Goodwill, end of period	$	541,850	$	539,818

14

JAMF HOLDING CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(unaudited)

The gross carrying amount and accumulated amortization of intangible assets other than goodwill are as follows:

								Weighted‑
								Average
				Accumulated		Net Carrying		Remaining
	Useful Life	Gross Value		Amortization		Value		Useful Life
		(in thousands)
Trademarks	8 years	$	34,320	$	13,454	$	20,866	4.8 years
Customer relationships	2 - 12 years		214,428		55,810		158,618	8.7 years
Developed technology	5 years		54,563		31,173		23,390	2.3 years
Non‑competes	2 years		90		86		4	0.1 years
Balance, December 31, 2020		$	303,401	$	100,523	$	202,878
Trademarks	8 years	$	34,300	$	14,506	$	19,794	4.6 years
Customer relationships	2 - 12 years		214,408		60,342		154,066	8.5 years
Developed technology	5 years		57,193		33,949		23,244	2.4 years
Non‑competes	2 years		90		90		—	—
In-process research and development	Indefinite		400		—		400
Balance, March 31, 2021		$	306,391	$	108,887	$	197,504

Amortization expense was $8.4 million for both the three months ended March 31, 2021 and 2020.

There were 0 impairments to goodwill or intangible assets recorded for the three months ended March 31, 2021 and 2020.

Note 6. Leases

The Company determines if an arrangement is or contains a lease at inception, which is the date on which the terms of the contract are agreed to and the agreement creates enforceable rights and obligations. Under ASC 842, a contract is or contains a lease when (i) explicitly or implicitly identified assets have been deployed in the contract and (ii) the customer obtains substantially all of the economic benefits from the use of that underlying asset and directs how and for what purpose the asset is used during the term of the contract. The Company also considers whether its service arrangements include the right to control the use of an asset. See Note 2 for more information on the Company’s accounting policies for leases.

The Company leases office facilities and vehicles under operating lease agreements that have initial terms ranging from 1 to 9 years. Some leases include one or more options to renew, generally at our sole discretion, with renewal terms that can extend the lease term up to 10 years. In addition, certain leases contain termination options, where the rights to terminate are held by either the Company, the lessor, or both parties. These options to extend or terminate a lease are included in the lease terms when it is reasonably certain that the Company will exercise that option. The Company’s leases generally do not contain any material restrictive covenants or residual value guarantees. The Company also leases office equipment under a finance lease agreement with a term of 4 years. The Company’s finance lease was not material to the consolidated financial statements as of March 31, 2021.

15

JAMF HOLDING CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(unaudited)

Supplemental balance sheet information related to the Company’s operating leases is as follows:

Leases	Balance Sheet Classification	March 31, 2021
		(in thousands)
Assets
Operating lease assets	Other assets	$	23,868
Liabilities
Operating lease liabilities - current	Accrued liabilities	$	4,870
Operating lease liabilities - non-current	Other liabilities		23,184
Total operating lease liabilities		$	28,054

The weighted-average remaining term of the Company’s operating leases was 6.5 years as of March 31, 2021. The weighted-average discount rate used to measure the present value of the operating lease liabilities was 3.5% as of March 31, 2021.

The components of lease expense were as follows:

	Three Months Ended
	March 31, 2021
	(in thousands)
Operating lease cost	$	1,514
Short-term lease cost		52
Variable lease cost		439
Total lease expense	$	2,005

Operating lease cost is recognized on a straight-line basis over the lease term. The Company leases certain office facilities with a related party, including the office space in Eau Claire, Wisconsin. Operating lease cost with related parties was $0.3 million for the three months ended March 31, 2021.

Total rent expense, including the Company’s share of the lessors’ operating expenses, was $1.4 million for the three months ended March 31, 2020. Rent expense with related parties, including the Company’s share of the lessors’ operating expenses, was $0.3 million for the three months ended March 31, 2020.

For the three months ended March 31, 2021, operating cash flows included $1.2 million of cash paid for operating lease liabilities.

16

JAMF HOLDING CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(unaudited)

Maturities of the Company’s operating lease liabilities as of March 31, 2021 were as follows:

	Operating Leases
	(in thousands)
Years ending December 31:
2021 (remaining nine months)	$	4,326
2022		5,407
2023		5,331
2024		4,589
2025		2,519
Thereafter		9,482
Total lease payments		31,654
Less: imputed interest		3,600
Total present value of lease liabilities	$	28,054

Note 7. Debt

On July 27, 2020, the Company entered into a new secured credit agreement (the “New Credit Agreement”) for an initial revolving credit facility of $150.0 million (the “New Revolving Credit Facility”), which may be increased or decreased under specific circumstances, with a $25.0 million letter of credit sublimit and a $50.0 million alternative currency sublimit. In addition, the New Credit Agreement provides for the ability of the Company to request incremental term loan facilities in a minimum amount of $5.0 million for each facility. The maturity date of the New Credit Agreement is July 27, 2025. The New Credit Agreement contains customary representations and warranties, affirmative covenants, reporting obligations, negative covenants and events of default. We were in compliance with such covenants as of both March 31, 2021 and December 31, 2020. As of both March 31, 2021 and December 31, 2020, we had $1.0 million of letters of credit outstanding under our New Revolving Credit Facility. In the third quarter of 2020, the Company recorded debt issuance costs of $1.3 million, which are amortized to interest expense over the term of the New Credit Agreement. As of both March 31, 2021 and December 31, 2020, debt issuance costs of $1.1 million were included in other assets in the consolidated balance sheets.

Note 8. Commitments and contingencies

Contingencies

From time to time, the Company may be subject to various claims, charges and litigation. The Company records a liability when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. The Company maintains insurance to cover certain actions and believes that resolution of such claims, charges, or litigation will not have a material impact on the Company’s financial position, results of operations, or liquidity. The Company had 0 liabilities for contingencies recorded as of March 31, 2021 and December 31, 2020.

17

JAMF HOLDING CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(unaudited)

Note 9. Net loss per share

The following table sets forth the computation of basic and diluted net loss per share:

	Three Months Ended March 31,
	2021		2020
	(in thousands, except share and per
	share amounts)
Numerator:
Net loss	$	(3,069)	$	(8,290)
Denominator:
Weighted‑average shares used to compute net loss per share, basic and diluted		117,386,322		102,860,545
Basic and diluted net loss per share	$	(0.03)	$	(0.08)

Basic net loss per share is computed by dividing the net loss by the weighted-average number of common shares outstanding for the period. Because we have reported a net loss for the three months ended March 31, 2021 and 2020, the number of shares used to calculate diluted net loss per common share is the same as the number of shares used to calculate basic net loss per common share because the potentially dilutive shares would have been antidilutive if included in the calculation.

The following potentially dilutive securities outstanding have been excluded from the computation of diluted weighted-average shares outstanding because such securities have an antidilutive impact due to losses reported:

	Three Months Ended March 31,
	2021	2020
Stock options outstanding	6,521,067	7,742,158
Unvested restricted stock units	1,374,401	36,520
Total potential dilutive securities	7,895,468	7,778,678

Note 10. Share-based compensation

On July 21, 2020, the Company adopted the Jamf Holding Corp. Omnibus Incentive Plan (the “2020 Plan”). The 2020 Plan provides for grants of (i) stock options, (ii) stock appreciation rights, (iii) restricted shares, (iv) performance awards, (v) other share-based awards and (vi) other cash-based awards to eligible employees, non-employee directors and consultants of the Company. We initially reserved 14,800,000 shares of our common stock for issuance under the 2020 Plan. The total number of shares reserved for issuance under the 2020 Plan increases on January 1^st of each of the first 10 calendar years during the term of the 2020 Plan by the lesser of: (i) a number of shares of our common stock equal to 4% of the total number of shares of our common stock outstanding on December 31^st of the preceding calendar year or (ii) a number of shares of our common stock as determined by our board of directors. The maximum number of shares of common stock available for issuance under the 2020 Plan was 19,479,699 shares as of January 1, 2021. As of March 31, 2021, 18,105,298 shares of common stock are reserved for additional grants under the 2020 Plan.

The 2017 Stock Option Plan (“2017 Option Plan”) became effective November 13, 2017 upon the approval of the board of directors and, prior to the adoption of the 2020 Plan, served as the umbrella plan for the Company’s stock-based and cash-based incentive compensation program for its officers and other eligible employees. The aggregate number of shares of common stock that may be issued under the 2017 Option Plan may not exceed 8,470,000 shares. As of March 31, 2021, 128,928 shares of common stock are reserved for additional grants under the 2017 Option Plan. All stock options granted by the Company were at an exercise price at or above the estimated fair market value of the Company’s common stock as of the grant date. NaN options were granted during the three months ended March 31, 2021.

18

JAMF HOLDING CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(unaudited)

The table below summarizes return target options activity for the three months ended March 31, 2021:

				Weighted-
		Weighted-		Average	Aggregate
		Average		Remaining	Intrinsic
		Exercise		Contractual	Value
	Options	Price		Term (Years)	(in thousands)
Outstanding, December 31, 2020	3,687,664	$	6.75	7.8	$	85,444
Granted	0		—			—
Exercised	—		—			—
Forfeitures	—		—			—
Outstanding, March 31, 2021	3,687,664	$	6.75	7.5	$	105,358
Options exercisable at March 31, 2021	—	$	—	—	$	—
Vested or expected to vest at March 31, 2021	—	$	—	—	$	—

There was approximately $33.0 million of unrecognized compensation expense related to these return target options as of March 31, 2021. The aggregate intrinsic value in the table above represents the total intrinsic value that would have been received by the optionholders had all optionholders exercised their options.

Restricted stock unit (“RSU”) activity for the three months ended March 31, 2021 was as follows:

		Per Unit
	Units	Fair Value
Outstanding, December 31, 2020	1,293,107	$	26.34
Granted	88,764		37.37
Restrictions lapsed	—		—
Forfeited	(7,470)		26.00
Outstanding, March 31, 2021	1,374,401	$	27.05

RSUs under the 2020 Plan vest ratably over four years. RSUs under the 2017 Option Plan vest 100% on the one-year anniversary of the date of the grant. The estimated compensation cost of each RSU, which is equal to the fair value of the award on the date of grant, is recognized on a straight-line basis over the vesting period. There was $31.3 million of total unrecognized compensation cost related to unvested restricted stock that is expected to be recognized over a weighted-average period of 3.4 years as of March 31, 2021.

The table below summarizes the service-based option activity for the three months ended March 31, 2021:

				Weighted‑
		Weighted‑		Average	Aggregate
		Average		Remaining	Intrinsic
		Exercise		Contractual	Value
	Options	Price		Term (Years)	(in thousands)
Outstanding, December 31, 2020	3,546,826	$	5.65	7.1	$	86,098
Granted	—		—			—
Exercised	(713,423)		5.63			21,328
Forfeitures	—		—			—
Outstanding, March 31, 2021	2,833,403	$	5.65	6.8	$	84,072
Options exercisable at March 31, 2021	1,790,693	$	5.50	6.7	$	53,395
Vested or expected to vest at March 31, 2021	2,833,403	$	5.65	6.8	$	84,072

The aggregate intrinsic value in the table above represents the total intrinsic value that would have been received by the optionholders had all optionholders exercised their options on the last date of the period. The total fair

19

JAMF HOLDING CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(unaudited)

value of service-based options vested during the three months ended March 31, 2021 was $0.7 million. There was $2.7 million of unrecognized compensation expense related to service-based options that is expected to be recognized over a weighted-average period of 1.5 years as of March 31, 2021.

The Company recognized stock-based compensation expense as follows:

	Three Months Ended March 31,
	2021		2020
	(in thousands)
Cost of revenue:
Subscription	$	324	$	38
Services		77		—
Sales and marketing		842		111
Research and development		778		157
General and administrative		811		505
	$	2,832	$	811

Note 11. Income taxes

The Company’s effective tax rates for the three months ended March 31, 2021 and 2020 were (2.2)% and 28.0%, respectively. The effective tax rate for the three months ended March 31, 2021 was lower than the prior year period due to Section 162(m) of the Internal Revenue Code, stock option activity and the domestic valuation allowance. The effective tax rate for the three months ended March 31, 2021 differs from the statutory rate primarily as a result of the domestic valuation allowance. The effective tax rate for the three months ended March 31, 2021 was impacted by less than $0.1 million of discrete income tax expense. The Company’s annual effective tax rates for the three months ended March 31, 2021 and 2020 were (0.5)% and 25.2%, respectively.

Note 12. Related-party transactions

The Company made pledges to the Jamf Nation Global Foundation (“JNGF”) of $0.1 million for the three months ended March 31, 2021. The Company did not make any pledges to the JNGF for the three months ended March 31, 2020. As of March 31, 2021 and December 31, 2020, the Company accrued $0.4 million and $0.9 million, respectively, related to JNGF pledges, which are included in accrued liabilities in the consolidated balance sheets. The Company has an ongoing lease agreement for office space in Eau Claire, Wisconsin with an entity in which a related party is a minority owner. See Note 6 for further discussion of this lease agreement. The Company may engage in transactions in the ordinary course of business with other companies whose directors or officers may also serve as directors or officers for the Company. The Company carries out these transactions on customary terms.

Vista is a U.S.-based investment firm that controls the funds which own a majority of the Company. The Company has paid for consulting services and other expenses related to services provided by Vista and Vista affiliates. The total expenses incurred by the Company for these services were less than $0.1 million and $0.2 million for the three months ended March 31, 2021 and 2020, respectively. The Company had less than $0.1 million in accounts payable related to these expenses as of both March 31, 2021 and December 31, 2020.

The Company also has revenue arrangements with Vista affiliates. The Company recognized revenue related to these arrangements of $0.2 million and $0.3 million for the three months ended March 31, 2021 and 2020, respectively. The Company had $0.2 million in accounts receivable related to these agreements as of March 31, 2021 and $0.3 million in accounts receivable related to these agreements as of December 31, 2020.

20

JAMF HOLDING CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(unaudited)

In addition, the Company pays for services with Vista affiliates in the normal course of business. The total expenses incurred by the Company for services with Vista affiliates were $0.2 million and $0.1 million for the three months ended March 31, 2021 and 2020, respectively. The Company had less than $0.1 million in accounts payable related to these expenses as of March 31, 2021 and $0.1 million in accounts payable related to these expenses as of December 31, 2020.

Prior to its termination and repayment in full on July 27, 2020, the Company was party to a term loan facility (the “Prior Term Loan”) and revolving credit facility with a consortium of lenders for a principal amount of $205.0 million and principal committed amount of $15.0 million, respectively. During the three months ended March 31, 2020, affiliates of Vista were paid $0.8 million in interest on the portion of the Prior Term Loan held by them.

Note 13. Subsequent event

On May 11, 2021, the Company announced that it has signed a definitive agreement (the “Merger Agreement”) to acquire Wandera, Inc. (“Wandera”), a leader in zero trust cloud security and access for mobile devices. Under the terms of the Merger Agreement, Jamf will acquire Wandera for total cash consideration of $400.0 million subject to customary adjustments, including working capital, indebtedness, closing cash on hand and transaction expenses. The total consideration consists of an initial payment of $350.0 million at close and deferred consideration of $50.0 million to be paid in $25.0 million increments on October 1, 2021 and December 15, 2021. The transaction is expected to close during the third quarter of 2021, subject to the satisfaction of customary closing conditions, including required U.S. regulatory approvals.

21

Forward-Looking Statements

This Quarterly Report on Form 10-Q contains forward-looking statements that are subject to risks and uncertainties. All statements other than statements of historical fact included in this Quarterly Report on Form 10-Q are forward-looking statements. Forward-looking statements give our current expectations and projections relating to our financial condition, results of operations, plans, objectives, future performance and business. You can identify forward-looking statements by the fact that they do not relate strictly to historical or current facts. These statements may include words such as “anticipate,” “estimate,” “expect,” “project,” “plan,” “intend,” “believe,” “may,” “will,” “should,” “can have,” “likely” and other words and terms of similar meaning in connection with any discussion of the timing or nature of future operating or financial performance or other events. For example, all statements we make relating to our estimated and projected costs, expenditures, cash flows, growth rates and financial results or our plans and objectives for future operations, growth initiatives, or strategies are forward-looking statements. All forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those that we expected, including:

● the ability of Jamf and Wandera to close the announced transaction;

● the ability of Jamf to realize the potential benefits of the acquisition of Wandera;

● the possibility that the closing of the transaction may be delayed;

● other risks related to Jamf’s integration of Wandera’s business, team, and technology;

● the impact on our operations and financial condition from the effects of the current COVID-19 pandemic;

● the potential impact of customer dissatisfaction with Apple or other negative events affecting Apple services and devices, and failure of enterprises to adopt Apple products;

● the potentially adverse impact of changes in features and functionality by Apple on our engineering focus or product development efforts;

● changes in our continued relationship with Apple;

● the fact that we are not party to any exclusive agreements or arrangements with Apple;

● our reliance, in part, on channel partners for the sale and distribution of our products;

● the impact of reputational harm if users perceive our products as the cause of device failure;

● our ability to successfully develop new products or materially enhance current products through our research and development efforts;

● our ability to continue to attract new customers;

● our ability to retain our current customers;

● our ability to sell additional functionality to our current customers;

● our ability to meet service-level commitments under our subscription agreements;

● our ability to correctly estimate market opportunity and forecast market growth;

22

● risks associated with failing to continue our recent growth rates;

● our dependence on one of our products for a substantial portion of our revenue;

● our ability to scale our business and manage our expenses;

● our ability to change our pricing models, if necessary to compete successfully;

● the impact of delays or outages of our cloud services from any disruptions, capacity limitations or interferences of third-party data centers that host our cloud services, including Amazon Web Services (“AWS”);

● our ability to maintain, enhance and protect our brand;

● our ability to maintain our corporate culture;

● the ability of Jamf Nation to thrive and grow as we expand our business;

● the potential impact of inaccurate, incomplete or misleading content that is posted on Jamf Nation;

● our ability to offer high-quality support;

● risks and uncertainties associated with potential acquisitions and divestitures, including, but not limited to, disruptions to ongoing operations; diversions of management from day-to-day responsibilities; adverse impacts on our financial condition; failure of an acquired business to further our strategy; uncertainty of synergies; personnel issues; resulting lawsuits and issues unidentified in diligence processes;

● our ability to predict and respond to rapidly evolving technological trends and our customers' changing needs;

● our ability to compete with existing and new companies;

● the impact of adverse general and industry-specific economic and market conditions;

● the impact of reductions in IT spending;

● our ability to attract and retain highly qualified personnel;

● risks associated with competitive challenges faced by our customers;

● the impact of our often long and unpredictable sales cycle;

● our ability to develop and expand our marketing and sales capabilities;

● the risks associated with sales to new and existing enterprise customers;

● the risks associated with free trials and other inbound, lead-generation sales strategies;

● the risks associated with indemnity provisions in our contracts;

● our management team’s limited experience managing a public company;

● the impact of any catastrophic events;

23

● the impact of global economic conditions;

● risks associated with cyber-security events;

● the impact of real or perceived errors, failures or bugs in our products;

● the impact of interruptions or performance problems associated with our technology or infrastructure;

● the impact of general disruptions to data transmission;

● risks associated with stringent and changing privacy laws, regulations and standards, and information security policies and contractual obligations related to data privacy and security;

● the risks associated with intellectual property infringement, misappropriation or other claims;

● our reliance on third-party software and intellectual property licenses;

● our ability to obtain, protect, enforce and maintain our intellectual property and proprietary rights;

● the risks associated with our use of open source software in our products; and

● other factors disclosed in the section entitled “Risk Factors” and elsewhere in our Annual Report on Form 10-K and this Quarterly Report on Form 10-Q.

We derive many of our forward-looking statements from our operating budgets and forecasts, which are based on many detailed assumptions. While we believe that our assumptions are reasonable, we caution that it is very difficult to predict the impact of known factors, and it is impossible for us to anticipate all factors that could affect our actual results. Important factors that could cause actual results to differ materially from our expectations, or cautionary statements, are disclosed under “Risk Factors” and “Management's Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part I, Item 2 of this Quarterly Report on Form 10-Q. All written and oral forward-looking statements attributable to us, or persons acting on our behalf, are expressly qualified in their entirety by these cautionary statements as well as other cautionary statements that are made from time to time in our other SEC filings and public communications. You should evaluate all forward-looking statements in the context of these risks and uncertainties.

We caution you that the important factors referenced above may not contain all of the factors that are important to you. In addition, we cannot assure you that we will realize the results or developments we expect or anticipate or, even if substantially realized, that they will result in the consequences or affect us or our operations in the way we expect. The forward-looking statements included in this Quarterly Report on Form 10-Q are made only as of the date hereof. We undertake no obligation to update or revise any forward-looking statement as a result of new information, future events or otherwise, except as otherwise required by law.

24

Item 2.    MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis summarizes the significant factors affecting the consolidated operating results, financial condition, liquidity and cash flows of our company as of and for the periods presented below. The following discussion and analysis should be read in conjunction with our consolidated financial statements and the related notes included elsewhere in this Quarterly Report on Form 10-Q and our consolidated financial statements and the related notes in our Annual Report on Form 10-K. The discussion contains forward-looking statements that are based on the beliefs of management, as well as assumptions made by, and information currently available to, our management. Actual results could differ materially from those discussed in or implied by forward-looking statements as a result of various factors, including those discussed below and in our Annual Report on Form 10-K, particularly in the sections entitled “Risk Factors” and “Forward-Looking Statements.”

Overview

We are the standard in Apple Enterprise Management, and our cloud software platform is the only vertically-focused Apple infrastructure and security platform of scale in the world. We help organizations, including businesses, hospitals, schools and government agencies, connect, manage and protect Apple products, apps and corporate resources in the cloud without ever having to touch the devices. With Jamf’s software, Apple devices can be deployed to employees brand new in the shrink-wrapped box, set up automatically and personalized at first power-on and administered continuously throughout the life of the device.

Jamf was founded in 2002, around the same time that Apple was leading an industry transformation. Apple transformed the way people access and utilize technology through its focus on creating a superior consumer experience. With the release of revolutionary products like the Mac, iPod, iPhone and iPad, Apple built the world’s most valuable brand and became ubiquitous in everyday life.

We have built our company through a singular focus on being the primary solution for Apple in the enterprise. Through our long-standing relationship with Apple, we have accumulated significant Apple technical experience and expertise that give us the ability to fully and quickly leverage and extend the capabilities of Apple products, operating systems and services. This expertise enables us to fully support new innovations and operating system releases the moment they are made available by Apple. This focus has allowed us to create a best-in-class user experience for Apple in the enterprise.

We sell our SaaS solutions via a subscription model, through a direct sales force, online and indirectly via our channel partners, including Apple. Our multi-dimensional go-to-market model and cloud-deployed offering enable us to reach all organizations around the world, large and small, with our software solutions. As a result, we continue to see rapid growth and expansion of our customer base as Apple continues to gain momentum in the enterprise.

On May 11, 2021, we announced the acquisition of Wandera, a leader in zero trust cloud security and access for mobile devices, extending our leadership in Apple Enterprise Management. See Note 13 for further information on the acquisition. Until close, the companies will continue to operate independently. We currently intend to finance the acquisition with a combination of cash on hand and debt financing.

Response to COVID-19

With social distancing measures having been implemented to curtail the spread of COVID-19, we enacted a robust business continuity plan, including a global work-from-home policy for all of our employees. We believe our internal cloud-first technology platforms have allowed for a seamless transition to a remote working environment without any material impacts to our business, highlighting the resilience of our business model. Our product portfolio and platform has enabled our commercial customers to continue with their efforts to work remotely, our K-12 and higher-education customers to deliver distance learning and our health-care customers to provide quality care via a telehealth model, a solution that was conceptualized and released during the current pandemic. We believe that a

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business like ours is well-suited to navigate the current environment in which customers are focused on effectively conducting business remotely, while the underlying demand for our core products remains relatively unchanged.

The extent to which the COVID-19 pandemic affects our business will depend on future developments in the United States and around the world, which are highly uncertain and cannot be predicted, including new information which may emerge concerning the severity of the coronavirus and the actions required to contain and treat it, among others. Although the ultimate impact of the COVID-19 pandemic on our business and financial results remains uncertain, a continued and prolonged public health crisis such as the COVID-19 pandemic could have a material negative impact on our business, operating results and financial condition. See “Risk Factors — Risks Relating to Our Business — The COVID-19 pandemic could materially adversely affect our business, operating results, financial condition and prospects” included in Part II, Item 1A in this Quarterly Report on Form 10-Q for additional information.

Key Factors Affecting Our Performance

Our historical financial performance has been, and we expect our financial performance in the future to be, driven by our ability to:

Attract new customers. Our ability to attract new customers is dependent upon a number of factors, including the effectiveness of our pricing and solutions, the features and pricing of our competitors' offerings, the effectiveness of our marketing efforts, the effectiveness of our channel partners in selling, marketing and deploying our software solutions and the growth of the market for Apple devices and services for SMBs and enterprises. Sustaining our growth requires continued adoption of our platform by new customers. We intend to continue to invest in building brand awareness as we further penetrate our addressable markets. We intend to expand our customer base by continuing to make significant and targeted investments in our direct sales and marketing to attract new customers and to drive broader awareness of our software solutions. 

Expand within our customer base. Our ability to increase revenue within our existing customer base is dependent upon a number of factors, including their satisfaction with our software solutions and support, the features and pricing of our competitors’ offerings and our ability to effectively enhance our platform by developing new products and features and addressing additional use cases. Often our customers will begin with a small deployment and then later expand their usage more broadly within the enterprise as they realize the benefits of our platform. We believe that our “land and expand” business model allows us to efficiently increase revenue from our existing customer base. We intend to continue to invest in enhancing awareness of our software solutions, creating additional use cases, and developing more products, features, and functionality, which we believe are important factors to expand usage of our software solutions by our existing customer base. We believe our ability to retain and expand usage of our software solutions by our existing customer base is evidenced by our dollar-based net retention rate.

Sustain product innovation and technology leadership. Our success is dependent on our ability to sustain product innovation and technology leadership in order to maintain our competitive advantage. We believe that we have built a highly differentiated platform and we intend to further extend the adoption of our platform through additional innovation. While sales of subscriptions to our Jamf Pro product account for most of our revenue, we intend to continue to invest in building additional products, features and functionality that expand our capabilities and facilitate the extension of our platform to new use cases. Our future success is dependent on our ability to successfully develop, market and sell additional products to both new and existing customers. For example, in 2018, we introduced Jamf Connect to provide users with a seamless connection to corporate resources using a single identity and in 2019 we introduced Jamf Protect to extend Apple's security and privacy model to enterprise teams by creating unprecedented visibility into MacOS fleets through customized remote monitoring and threat detection and prevention.

Continue investment in growth. Our ability to effectively invest for growth is dependent upon a number of factors, including our ability to offset anticipated increases in operating expenses with revenue growth, our ability to spend our research and development budget efficiently or effectively on compelling innovation and technologies, our ability to accurately predict costs and our ability to maintain our corporate culture as our headcount expands. We plan to continue investing in our business so we can capitalize on our market opportunity. We intend to grow our sales team to target expansion within our midmarket and enterprise customers and to attract new customers. We expect to continue to

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make focused investments in marketing to drive brand awareness and enhance the effectiveness of our customer acquisition model. We also intend to continue to add headcount to our research and development team to develop new and improved products, features and functionality. Although these investments may increase our operating expenses and, as a result, adversely affect our operating results in the near term, we believe they will contribute to our long-term growth.

Continue international expansion. Our international growth in any region will depend on our ability to effectively implement our business processes and go-to-market strategy, our ability to adapt to market or cultural differences, the general competitive landscape, our ability to invest in our sales and marketing channels, the maturity and growth trajectory of Apple devices and services by region and our brand awareness and perception. We plan to continue making investments in our international sales and marketing channels to take advantage of this market opportunity while refining our go-to-market approach based on local market dynamics. While we believe global demand for our platform will increase as international market awareness of Jamf grows, our ability to conduct our operations internationally will require considerable management attention and resources and is subject to the particular challenges of supporting a growing business in an environment of multiple languages, cultures, customs, legal and regulatory systems (including with respect to data transfer and privacy), alternative dispute systems and commercial markets. In addition, global demand for our platform and the growth of our international operations is dependent upon the rate of market adoption of Apple products in international markets.

Enhance our offerings via our partner network. Our success is dependent not only on our independent efforts to innovate, scale and reach more customers directly but also on the success of our partners to continue to gain share in the enterprise. With a focus on the user and being the bridge between critical technologies — with Apple and Microsoft as two examples — we feel we can help other market participants deliver more to enterprise users with the power of Jamf. We will continue to invest in the relationships with our existing, critical partners, nurture and develop new relationships and do so globally. We will continue to invest in developing “plus one” solutions and workflows that help tie our software solutions together with those delivered by others.

Key Business Metrics

In addition to our GAAP financial information, we review several operating and financial metrics, including the following key metrics, to evaluate our business, measure our performance, identify trends affecting our business, formulate business plans, and make strategic decisions.

Number of Devices

We believe our ability to grow the number of devices on our software platform provides a key indicator of the growth of our business and our future business opportunities. We define a device at the end of any particular period as a device owned by a customer, which device has at least one Jamf product pursuant to an active subscription or support and maintenance agreement or that has a reasonable probability of renewal. We define a customer at the end of any particular period as an entity with at least one active subscription or support and maintenance agreement as of the measurement date or that has a reasonable probability of renewal. A single organization with separate subsidiaries, segments or divisions that use our platform may represent multiple customers as we treat each entity, subsidiary, segment or division that is invoiced separately as a single customer. In cases where customers subscribe to our platform through our channel partners, each end customer is counted separately. A single customer may have multiple Jamf products on a single device, but we still would only count that as one device. 

The number of devices was 21.8 million and 16.3 million as of March 31, 2021 and 2020, respectively, representing a 34% year-over-year growth rate. We have seen particular strength in the growth rate of devices as COVID-19 has accelerated the demand for organizations to connect remotely, manage, and protect their Apple devices.

Annual Recurring Revenue

Annual Recurring Revenue (“ARR”) represents the annualized value of all subscription and support and maintenance contracts as of the end of the period. ARR mitigates fluctuations due to seasonality, contract term and the

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sales mix of subscriptions for term-based licenses and SaaS. ARR does not have any standardized meaning and is therefore unlikely to be comparable to similarly titled measures presented by other companies. ARR should be viewed independently of revenue and deferred revenue and is not intended to be combined with or to replace either of those items. ARR is not a forecast and the active contracts at the end of a reporting period used in calculating ARR may or may not be extended or renewed by our customers.

Our ARR was $308.0 million and $224.9 million as of March 31, 2021 and 2020, respectively, which is an increase of 37% year-over-year. The growth in our ARR is primarily driven by our high device expansion rates, our new logo acquisition and the upselling and cross selling of products into our installed base.

Dollar-Based Net Retention Rate

To further illustrate the “land and expand” economics of our customer relationships, we examine the rate at which our customers increase their subscriptions for our software solutions. Our dollar-based net retention rate measures our ability to increase revenue across our existing customer base through expanded use of our software solutions, offset by customers whose subscription contracts with us are not renewed or renew at a lower amount.

We calculate dollar-based net retention rate as of a period end by starting with the ARR from the cohort of all customers as of 12 months prior to such period end (“Prior Period ARR”). We then calculate the ARR from these same customers as of the current period end (“Current Period ARR”). Current Period ARR includes any expansion and is net of contraction or attrition over the last 12 months but excludes ARR from new customers in the current period. We then divide the total Current Period ARR by the total Prior Period ARR to arrive at the dollar-based net retention rate.

Our dollar-based net retention rates were 117% and 120% for the trailing twelve months ended March 31, 2021 and 2020, respectively. Our high dollar-based net retention rates are primarily attributable to an expansion of devices. We believe our ability to cross-sell our new solutions to our installed base, particularly Jamf Connect and Jamf Protect, will continue to support our high dollar-based net retention rates.

Non-GAAP Financial Measures

In addition to our results determined in accordance with GAAP, we believe the non-GAAP measures of Non-GAAP Gross Profit, Non-GAAP Gross Profit Margin, Non-GAAP Operating Income, Non-GAAP Operating Income Margin, Non-GAAP Net Income and Adjusted EBITDA are useful in evaluating our operating performance. We believe that non-GAAP financial information, when taken collectively, may be helpful to investors because it provides consistency and comparability with past financial performance and assists in comparisons with other companies, some of which use similar non-GAAP information to supplement their GAAP results. The non-GAAP financial information is presented for supplemental informational purposes only, and should not be considered a substitute for financial information presented in accordance with GAAP, and may be different from similarly-titled non-GAAP measures used by other companies. A reconciliation is provided below for each non-GAAP financial measure to the most directly comparable financial measure stated in accordance with GAAP. Investors are encouraged to review the related GAAP financial measures and the reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measures.

Non-GAAP Gross Profit

Non-GAAP Gross Profit and Non-GAAP Gross Profit Margin are supplemental measures of operating performance that are not prepared in accordance with GAAP and that do not represent, and should not be considered as, alternatives to gross profit or gross profit margin, as determined in accordance with GAAP. We define Non-GAAP Gross Profit as gross profit, adjusted for stock-based compensation expense and amortization expense. We define Non-GAAP Gross Profit Margin as Non-GAAP Gross Profit as a percentage of total revenue.

We use Non-GAAP Gross Profit and Non-GAAP Gross Profit Margin to understand and evaluate our core operating performance and trends and to prepare and approve our annual budget. We believe Non-GAAP Gross Profit and Non-GAAP Gross Profit Margin are useful measures to us and to our investors to assist in evaluating our core

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operating performance because it provides consistency and direct comparability with our past financial performance and between fiscal periods, as the metric eliminates the effects of variability of stock-based compensation expense and amortization of acquired developed technology, which are non-cash expenses that may fluctuate for reasons unrelated to overall operating performance. While the amortization expense of acquired developed technology is excluded from Non-GAAP Gross Profit, the revenue related to acquired developed technology is reflected in Non-GAAP Gross Profit as these assets contribute to our revenue generation.

Non-GAAP Gross Profit and Non-GAAP Gross Profit Margin have limitations as analytical tools, and you should not consider them in isolation, or as substitutes for analysis of our results as reported under GAAP. Because of these limitations, Non-GAAP Gross Profit and Non-GAAP Gross Profit Margin should not be considered as replacements for gross profit or gross profit margin, as determined by GAAP, or as measures of our profitability. We compensate for these limitations by relying primarily on our GAAP results and using non-GAAP measures only for supplemental purposes.

A reconciliation of Non-GAAP Gross Profit to gross profit, the most directly comparable GAAP measure, is as follows:

	Three Months Ended March 31,
	2021			2020
	(in thousands)
Gross profit	$	63,912		$	45,379
Amortization expense		2,777			2,677
Stock-based compensation		401			38
Non-GAAP Gross Profit	$	67,090		$	48,094
Non-GAAP Gross Profit Margin		83	%		80	%

Non-GAAP Operating Income

Non-GAAP Operating Income and Non-GAAP Operating Income Margin are supplemental measures of operating performance that are not prepared in accordance with GAAP and that do not represent, and should not be considered as, alternatives to operating loss or operating loss margin, as determined in accordance with GAAP. We define Non-GAAP Operating Income as operating loss, adjusted for amortization, stock-based compensation, acquisition-related expense, acquisition-related earnout, payroll taxes related to stock-based compensation and costs associated with our secondary offerings. In the first quarter of 2021, we began excluding payroll taxes related to stock-based compensation from our non-GAAP measures as these expenses are tied to the exercise or vesting of underlying equity awards and the price of our common stock at the time of vesting or exercise. As a result, these taxes may vary in any particular period independent of the financial and operating performance of our business. Payroll taxes related to stock-based compensation were not material prior to the first quarter of 2021. We define Non-GAAP Operating Income Margin as Non-GAAP Operating Income as a percentage of total revenue.

We use Non-GAAP Operating Income and Non-GAAP Operating Income Margin to understand and evaluate our core operating performance and trends, to prepare and approve our annual budget, and to develop short-term and long-term operating plans. We believe that Non-GAAP Operating Income and Non-GAAP Operating Income Margin facilitate comparison of our operating performance on a consistent basis between periods, and when viewed in combination with our results prepared in accordance with GAAP, help provide a broader picture of factors and trends affecting our results of operations. While the amortization expense of acquired trademarks, customer relationships, and developed technology is excluded from Non-GAAP Operating Income, the revenue related to acquired trademarks, customer relationships, and developed technology is reflected in Non-GAAP Operating Income as these assets contribute to our revenue generation.

Non-GAAP Operating Income and Non-GAAP Operating Income Margin have limitations as analytical tools, and you should not consider them in isolation, or as substitutes for analysis of our results as reported under GAAP. Because of these limitations, Non-GAAP Operating Income and Non-GAAP Operating Income Margin should not be considered as replacements for operating loss or operating loss margin, as determined by GAAP, or as measures of our

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profitability. We compensate for these limitations by relying primarily on our GAAP results and using non-GAAP measures only for supplemental purposes.

A reconciliation of Non-GAAP Operating Income to operating loss, the most directly comparable GAAP measure, is as follows:

	Three Months Ended March 31,
	2021			2020
	(in thousands)
Operating loss	$	(2,778)		$	(6,483)
Amortization expense		8,404			8,351
Stock-based compensation		2,832			811
Acquisition-related expense		110			1,600
Acquisition-related earnout		300			—
Payroll taxes related to stock-based compensation		395			—
Non-GAAP Operating Income	$	9,263		$	4,279
Non-GAAP Operating Income Margin		11	%		7	%

Non-GAAP Net Income (Loss)

Non-GAAP Net Income (Loss) is a supplemental measure of operating performance that is not prepared in accordance with GAAP and that does not represent, and should not be considered as, an alternative to net loss, as determined in accordance with GAAP. We define Non-GAAP Net Income (Loss) as net loss, adjusted for amortization, stock-based compensation, foreign currency transaction loss, loss on extinguishment of debt, acquisition-related expense, acquisition-related earnout, costs associated with our secondary offerings, payroll taxes related to stock-based compensation, discrete tax items and provision (benefit) for income taxes.

We use Non-GAAP Net Income (Loss) to understand and evaluate our core operating performance and trends, to prepare and approve our annual budget, and to develop short-term and long-term operating plans. We believe that Non-GAAP Net Income (Loss) facilitates comparison of our operating performance on a consistent basis between periods, and when viewed in combination with our results prepared in accordance with GAAP, helps provide a broader picture of factors and trends affecting our results of operations. While the amortization expense of acquired trademarks, customer relationships, and developed technology is excluded from Non-GAAP Net Income (Loss), the revenue related to acquired trademarks, customer relationships, and developed technology is reflected in Non-GAAP Net Income (Loss) as these assets contribute to our revenue generation.

Non-GAAP Net Income (Loss) has limitations as an analytical tool, and you should not consider it in isolation, or as a substitute for analysis of our results as reported under GAAP. Because of these limitations, Non-GAAP Net Income (Loss) should not be considered as a replacement for net loss, as determined by GAAP, or as a measure of our profitability. We compensate for these limitations by relying primarily on our GAAP results and using non-GAAP measures only for supplemental purposes.

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A reconciliation of Non-GAAP Net Income (Loss) to net loss, the most directly comparable GAAP measure, is as follows:

	Three Months Ended March 31,
	2021		2020
	(in thousands)
Net loss	$	(3,069)	$	(8,290)
Amortization expense		8,404		8,351
Stock-based compensation		2,832		811
Foreign currency transaction loss		171		304
Acquisition-related expense		110		1,600
Acquisition-related earnout		300		—
Payroll taxes related to stock-based compensation		395		—
Discrete tax items		49		(318)
Provision (benefit) for income taxes(1)		66		(2,703)
Non-GAAP Net Income (Loss)	$	9,258	$	(245)

⁽¹⁾ In the first quarter of 2020, the related tax effects of the adjustments to Non-GAAP Net Income (Loss) were calculated using the respective statutory tax rate for applicable jurisdictions, which was not materially different from our annual effective tax rate for full year 2020 of approximately 25%. In the first quarter of 2021, our annual effective tax rate was impacted by changes in the domestic valuation allowance. Therefore, we used the annual effective tax rate of (0.5)% in the first quarter of 2021 as this rate was materially different than our statutory rate.

Adjusted EBITDA

Adjusted EBITDA is a supplemental measure of operating performance that is not prepared in accordance with GAAP and that does not represent, and should not be considered as, an alternative to net loss, as determined in accordance with GAAP. We define Adjusted EBITDA as net loss, adjusted for interest expense, net, provision (benefit) for income taxes, depreciation and amortization, stock-based compensation, foreign currency transaction loss, loss on extinguishment of debt, acquisition-related expense, acquisition-related earnout, costs associated with our secondary offerings and payroll taxes related to stock-based compensation.

We use Adjusted EBITDA to understand and evaluate our core operating performance and trends, to prepare and approve our annual budget, and to develop short-term and long-term operating plans. We believe that Adjusted EBITDA facilitates comparison of our operating performance on a consistent basis between periods, and when viewed in combination with our results prepared in accordance with GAAP, helps provide a broader picture of factors and trends affecting our results of operations.

Adjusted EBITDA has limitations as an analytical tool, and you should not consider it in isolation, or as a substitute for analysis of our results as reported under GAAP. Because of these limitations, Adjusted EBITDA should not be considered as a replacement for net loss, as determined by GAAP, or as a measure of our profitability. We compensate for these limitations by relying primarily on our GAAP results and using non-GAAP measures only for supplemental purposes.

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A reconciliation of Adjusted EBITDA to net loss, the most directly comparable GAAP measure, is as follows:

	Three Months Ended March 31,
	2021		2020
	(in thousands)
Net loss	$	(3,069)	$	(8,290)
Interest expense, net		55		4,778
Provision (benefit) for income taxes		65		(3,220)
Depreciation expense		1,380		1,235
Amortization expense		8,404		8,351
Stock-based compensation		2,832		811
Foreign currency transaction loss		171		304
Acquisition-related expense		110		1,600
Acquisition-related earnout		300		—
Payroll taxes related to stock-based compensation		395		—
Adjusted EBITDA	$	10,643	$	5,569

Components of Results of Operations

Revenues

We recognize revenue under ASC 606 when or as performance obligations are satisfied. We derive revenue primarily from sales of SaaS subscriptions and support and maintenance contracts, and to a lesser extent, sales of on-premise subscriptions and perpetual licenses and services.

Subscription. Subscription revenue consists of sales of SaaS subscriptions and support and maintenance contracts. We sell our software solutions primarily with a one-year contract term. We typically invoice SaaS subscription fees and support and maintenance fees annually in advance and recognize revenue ratably over the term of the applicable agreement, provided that all other revenue recognition criteria have been satisfied. In the fourth quarter of 2020, we reclassified the license portion of on-premise subscription revenue from license revenue to subscription revenue in the consolidated statements of operations on a retroactive basis. See additional information in “Note 1 — Basis of Presentation and Description of Business” to the consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q. The license portion of on-premise subscription revenue is recognized upfront, assuming all revenue recognition criteria are satisfied. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Critical Accounting Policies” in our Annual Report on Form 10-K for more information. We expect subscription revenue to increase over time as we expand our customer base because sales to new customers are expected to be primarily SaaS subscriptions.

License. License revenue consists of revenue from on-premise perpetual licenses of our Jamf Pro product sold primarily to existing customers. We recognize license revenue upfront, assuming all revenue recognition criteria are satisfied. We expect license revenue to decrease because sales to new customers are primarily cloud-based subscription arrangements and therefore reflected in subscription revenue.

Services. Services revenues consist primarily of professional services provided to our customers to configure and optimize the use of our software solutions, as well as training services related to the operation of our software solutions. Our services are priced on a fixed fee basis and generally invoiced in advance of the service being delivered. Revenue is recognized as the services are performed. We expect services revenues to decrease as a percentage of total revenue as the demand for our services is not expected to grow at the same rate as the demand for our subscription solutions.

Cost of Revenues

Cost of subscription. Cost of subscription revenue consists primarily of employee compensation costs for employees associated with supporting our subscription and support and maintenance arrangements, our customer success

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function, and third-party hosting fees related to our cloud services. Employee compensation and related costs include cash compensation and benefits to employees and associated overhead costs. We expect cost of subscription revenue to increase in absolute dollars, but to remain relatively consistent as a percentage of subscription revenue, relative to the extent of the growth of our business.

Cost of services. Cost of services revenue consists primarily of employee compensation costs directly associated with delivery of professional services and training, costs of third-party integrators and other associated overhead costs. We expect cost of services revenue to decrease in absolute dollars relative to the decrease of our services business.

Gross Profit

Gross profit, or revenue less cost of revenue, has been and will continue to be affected by various factors, including the mix of cloud-based subscription customers, the costs associated with supporting our cloud solution, the extent to which we expand our customer support team and the extent to which we can increase the efficiency of our technology and infrastructure though technological improvements. We expect our gross profit to increase in absolute dollars.

Operating Expenses

Sales and Marketing. Sales and marketing expenses consist primarily of employee compensation costs, sales commissions, costs of general marketing and promotional activities, travel-related expenses and allocated overhead. Sales commissions earned by our sales force are deferred and amortized over the period of benefit, which is estimated to be 5 years. We expect our sales and marketing expenses to increase on an absolute dollar basis as we expand our sales personnel and marketing efforts.

Research and development. Research and development expenses consist primarily of personnel costs and allocated overhead. We will continue to invest in innovation so that we can offer our customers new solutions and enhance our existing solutions. See “Business — Research and Development” in our Annual Report on Form 10-K for more information. We expect such investment to increase on an absolute dollar basis as our business grows.

General and Administrative. General and administrative expenses consist primarily of employee compensation costs for corporate personnel, such as those in our executive, human resource, facilities, accounting and finance, legal and compliance, and information technology departments. In addition, general and administrative expenses include acquisition-related expenses which primarily consist of third-party expenses, such as legal and accounting fees, and adjustments to contingent consideration. General and administrative expenses also include costs incurred in secondary offerings. We expect our general and administrative expenses to increase on a dollar basis as our business grows, particularly as we continue to invest in technology infrastructure and expand our operations globally. Also, we incur additional general and administrative expenses as a result of operating as a public company, including costs to comply with the rules and regulations applicable to companies listed on a national securities exchange, costs related to compliance and reporting obligations pursuant to the rules and regulations of the SEC, and increased expenses for insurance, investor relations and accounting expenses.

Amortization. Amortization expense primarily consists of amortization of acquired trademarks, customer relationships and developed technology.

Interest Expense, Net

Interest expense, net consists primarily of interest payments on our outstanding borrowings under our credit facilities as well as the amortization of associated deferred financing costs. See “Liquidity and Capital Resources — Credit Facilities.”

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Foreign Currency Transaction Gain (Loss)

Our reporting currency is the U.S. dollar. The functional currency of all our international operations is the U.S. dollar. The assets, liabilities, revenues and expenses of our foreign operations are remeasured in accordance with ASC Topic 830, Foreign Currency Matters. Remeasurement adjustments are recorded as foreign currency transaction gains (losses) in the consolidated statement of operations.

Income Tax (Provision) Benefit

Income tax (provision) benefit consists primarily of income taxes related to U.S. federal and state income taxes and income taxes in foreign jurisdictions in which we conduct business.

Other Income

Other income consists primarily of sublease rental income. The sublease was terminated in the second quarter of 2020.

Results of Operations

The following table sets forth our consolidated statements of operations data for the periods indicated:

	Three Months Ended March 31,
	2021		2020
	(in thousands)
Consolidated Statement of Operations Data:
Revenue:
Subscription	$	74,923	$	54,618
Services		4,003		4,010
License		2,242		1,762
Total revenue		81,168		60,390
Cost of revenue:
Cost of subscription(1)(2) (exclusive of amortization expense shown below)		12,014		9,248
Cost of services(1)(2) (exclusive of amortization expense shown below)		2,465		3,086
Amortization expense		2,777		2,677
Total cost of revenue		17,256		15,011
Gross profit		63,912		45,379
Operating expenses:
Sales and marketing(1)(2)		29,332		22,282
Research and development(1)(2)		15,626		12,617
General and administrative(1)(2)(3)		16,105		11,289
Amortization expense		5,627		5,674
Total operating expenses		66,690		51,862
Loss from operations		(2,778)		(6,483)
Interest expense, net		(55)		(4,778)
Foreign currency transaction loss		(171)		(304)
Other income, net		—		55
Loss before income tax (provision) benefit		(3,004)		(11,510)
Income tax (provision) benefit		(65)		3,220
Net loss	$	(3,069)	$	(8,290)

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(1) Includes stock-based compensation as follows:

	Three Months Ended March 31,
	2021		2020
	(in thousands)
Cost of revenue:
Subscription	$	324	$	38
Services		77		—
Sales and marketing		842		111
Research and development		778		157
General and administrative		811		505
	$	2,832	$	811

(2) Includes depreciation expense as follows:

	Three Months Ended March 31,
	2021		2020
	(in thousands)
Cost of revenue:
Subscription	$	263	$	238
Services		43		53
Sales and marketing		574		494
Research and development		305		292
General and administrative		195		156
	$	1,380	$	1,233

(3) Includes acquisition-related expense as follows:

	Three Months Ended March 31,
	2021		2020
	(in thousands)
General and administrative	$	110	$	1,600

General and administrative also includes a Digita earnout expense of $0.3 million for the three months ended March 31, 2021.

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The following table sets forth our consolidated statements of operations data expressed as a percentage of total revenue for the periods indicated:

	Three Months Ended March 31,
	2021		2020
	(as a percentage of total revenue)
Consolidated Statement of Operations Data:
Revenue:
Subscription	92	%	90	%
Services	5		7
License	3		3
Total revenue	100		100
Cost of revenue:
Cost of subscription (exclusive of amortization expense shown below)	15		15
Cost of services (exclusive of amortization expense shown below)	3		5
Amortization expense	3		5
Total cost of revenue	21		25
Gross profit	79		75
Operating expenses:
Sales and marketing	36		37
Research and development	19		21
General and administrative	20		19
Amortization expense	7		9
Total operating expenses	82		86
Loss from operations	(3)		(11)
Interest expense, net	—		(7)
Foreign currency transaction loss	(1)		(1)
Other income, net	—		—
Loss before income tax (provision) benefit	(4)		(19)
Income tax (provision) benefit	—		5
Net loss	(4)	%	(14)	%

Comparison of the Three Months Ended March 31, 2021 and 2020

Revenue

	Three Months Ended March 31,				Change
	2021		2020		$		%
	(in thousands, except percentages)
SaaS subscription and support and maintenance	$	66,669	$	50,078	$	16,591	33	%
On‑premise subscription		8,254		4,540		3,714	82
Subscription revenue		74,923		54,618		20,305	37
Professional services		4,003		4,010		(7)	(0)
Perpetual licenses		2,242		1,762		480	27
Non‑subscription revenue		6,245		5,772		473	8
Total revenue	$	81,168	$	60,390	$	20,778	34	%

Total revenue increased by $20.8 million, or 34%, for the three months ended March 31, 2021 compared to the three months ended March 31, 2020. Overall revenue increased as a result of higher subscription revenue and license revenue. Subscription revenue accounted for 92% of total revenue for the three months ended March 31, 2021 compared to 90% for the three months ended March 31, 2020. The increase in subscription revenue was driven by device expansion, the addition of new customers and cross-selling. License revenue increased due to additional licenses for an existing customer, partially offset by shifting customers to our SaaS model as opposed to on-premise perpetual licenses.

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Cost of Revenue and Gross Margin

	Three Months Ended March 31,						Change
	2021			2020			$		%
	(in thousands, except percentages)
Cost of revenue:
Cost of subscription (exclusive of amortization expense shown below)	$	12,014		$	9,248		$	2,766	30	%
Cost of services (exclusive of amortization expense show below)		2,465			3,086			(621)	(20)
Amortization expense		2,777			2,677			100	4
Total cost of revenue	$	17,256		$	15,011		$	2,245	15	%
Gross margin		79	%		75	%

Cost of revenue increased by $2.2 million, or 15%, for the three months ended March 31, 2021 compared to the three months ended March 31, 2020 driven by an increase in cost of subscription revenue, partially offset by lower cost of services revenue. Cost of subscription revenue increased $2.8 million, or 30%, primarily due to an increase of $1.5 million in employee compensation costs related to higher headcount to support the growth in our subscription customer base, an increase of $1.2 million in third party hosting fees as we increased capacity to support our growth and a $0.3 million increase in stock-based compensation expense. Cost of services revenue decreased $0.6 million primarily due to lower travel-related costs and costs of third-party integrators.

Total gross margin was 79% and 75% for the three months ended March 31, 2021 and 2020, respectively, as our revenue expanded faster than the costs required to deliver the revenue.

Operating Expenses

	Three Months Ended March 31,				Change
	2021		2020		$		%
	(in thousands, except percentages)
Operating expenses:
Sales and marketing	$	29,332	$	22,282	$	7,050	32	%
Research and development		15,626		12,617		3,009	24
General and administrative		16,105		11,289		4,816	43
Amortization expense		5,627		5,674		(47)	(1)
Operating expenses	$	66,690	$	51,862	$	14,828	29	%

Sales and Marketing. Sales and marketing expenses increased by $7.1 million, or 32%, for the three months ended March 31, 2021 compared to the three months ended March 31, 2020. The increase was primarily due to an increase of $5.5 million in employee compensation costs driven by headcount growth, a $1.4 million increase in marketing costs, an increase of $0.3 million in computer hardware and software costs to support the growth of the business and a $0.7 million increase in stock-based compensation expense reflecting the IPO grant, partially offset by a $1.2 million decrease in travel-related expenses reflecting less travel due to COVID-19. Marketing costs increased primarily due to increases in demand generation programs, advertising, and brand awareness campaigns focused on new customer acquisition.

Research and Development. Research and development expenses increased by $3.0 million, or 24%, for the three months ended March 31, 2021 compared to the three months ended March 31, 2020. The increase was primarily due to an increase of $2.1 million in employee compensation costs due to higher headcount, an increase of $0.7 million in outside services and a $0.6 million increase in stock-based compensation expense reflecting the IPO grant, partially offset by a $0.4 million decrease in travel-related expenses reflecting less travel due to COVID-19.

General and Administrative. General and administrative expenses increased by $4.8 million, or 43%, for the three months ended March 31, 2021 compared to the three months ended March 31, 2020. The increase was primarily

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due to an increase of $2.8 million in employee compensation costs driven by higher headcount to support our continued growth, $2.0 million in additional expenses as a result of operating as a public company, an increase of $0.9 million in computer hardware and software costs to support the growth of the business, a $0.3 million increase in stock-based compensation expense and a $0.3 million increase to contingent consideration, partially offset by a $1.5 million decrease in acquisition-related expenses and a $1.1 million decrease in travel-related expenses reflecting less travel due to COVID-19. The remainder of the cost increase is primarily related to costs to support the growth in business and headcount.

Interest Expense, Net

	Three Months Ended March 31,				Change
	2021		2020		$		%
	(in thousands, except percentages)
Interest expense, net	$	55	$	4,778	$	(4,723)	(99)	%

Interest expense, net decreased by $4.7 million, or 99%, for the three months ended March 31, 2021 compared to the three months ended March 31, 2020 reflecting the repayment of the Prior Term Loan Facility.

Foreign Currency Transaction Loss

	Three Months Ended March 31,				Change
	2021		2020		$		%
	(in thousands, except percentages)
Foreign currency transaction loss	$	171	$	304	$	(133)	(44)	%

Foreign currency transaction loss decreased by $0.1 million, or 44%, for the three months ended March 31, 2021 compared to the three months ended March 31, 2020. The decrease in the loss was driven by a favorable impact from the remeasurement of monetary assets and liabilities denominated in Euros and Australian dollars compared to the prior year period.

Other Income, Net

	Three Months Ended March 31,				Change
	2021		2020		$		%
	(in thousands, except percentages)
Other income, net	$	—	$	55	$	(55)	(100)	%

Other income, net decreased by $0.1 million, or 100%, for the three months ended March 31, 2021 compared to the three months ended March 31, 2020. The decrease in Other income, net was due to the termination of our sublease in the second quarter of 2020.

Income Tax (Provision) Benefit

	Three Months Ended March 31,				Change
	2021		2020		$		%
	(in thousands, except percentages)
Income tax (provision) benefit	$	(65)	$	3,220	$	(3,285)	NM

Income tax (provision) benefit was $(0.1) million and $3.2 million for the three months ended March 31, 2021 and 2020, respectively. The effective tax rates for the three months ended March 31, 2021 and 2020 were (2.2)% and 28.0%, respectively. The effective tax rate for the three months ended March 31, 2021 was lower than the prior year period due to Section 162(m) of the Internal Revenue Code, stock option activity and the domestic valuation allowance.

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The Company’s annual effective tax rate for the three months ended March 31, 2021 and 2020 was (0.5)% and 25.2%, respectively.

Liquidity and Capital Resources

General

As of March 31, 2021, our principal sources of liquidity were cash and cash equivalents totaling $196.2 million, which were held for working capital purposes, as well as the available balance of our New Revolving Credit Facility, described in Note 7 to our Consolidated Financial Statements. Our cash equivalents are comprised of money market funds and/or U.S. Treasuries with original or remaining maturities at the time of purchase of three months or less. Our positive cash flows from operations enable us to make continued investments in supporting the growth of our business. We expect that our operating cash flows, in addition to our cash and cash equivalents, will enable us to continue to make such investments in the future.

On May 5, 2021, we entered into a commitment letter (the “Commitment Letter”) with JPMorgan Chase Bank, N.A. and other commitment parties thereto (the “Commitment Parties”), pursuant to which, subject to the terms and conditions set forth therein, the Commitment Parties have committed to provide a 364-day term loan facility in an aggregate principal amount of up to $250.0 million, on substantially the same terms and conditions as the New Credit Agreement. The funding of the term loan facility provided for by the Commitment Letter is contingent on the satisfaction of customary conditions, including the execution and delivery of definitive documentation with respect to the term loan facility in accordance with the terms set forth in the Commitment Letter.

We believe our cash and cash equivalents, our New Revolving Credit Facility and cash provided by sales of our software solutions and services will be sufficient to meet our working capital and capital expenditure needs for at least the next 12 months. Our future capital requirements will depend on many factors including our growth rate, the timing and extent of spending to support development efforts, the expansion of sales and marketing activities, the introduction of new and enhanced products and services offerings, and the continuing market acceptance of our products. In the future, we may use cash to acquire or invest in complementary businesses, services and technologies, including intellectual property rights.

A majority of our customers pay in advance for subscriptions and support and maintenance contracts, a portion of which is recorded as deferred revenue. Deferred revenue consists of the unearned portion of billed fees for our subscriptions, which is later recognized as revenue in accordance with our revenue recognition policy. As of March 31, 2021, we had deferred revenue of $221.6 million, of which $167.9 million was recorded as a current liability and is expected to be recorded as revenue in the next 12 months, provided all other revenue recognition criteria have been met.

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Cash Flows

The following table presents a summary of our consolidated cash flows from operating, investing and financing activities:

	Three Months Ended March 31,
	2021		2020
	(in thousands)
Net cash provided by (used in) operating activities	$	4,023	$	(7,355)
Net cash used in investing activities		(6,319)		(1,039)
Net cash provided by (used in) financing activities		4,019		(1,362)
Effect of exchange rate changes on cash and cash equivalents		(401)		—
Net increase (decrease) in cash and cash equivalents		1,322		(9,756)
Cash and cash equivalents at beginning of period		194,868		32,433
Cash and cash equivalents at end of period	$	196,190	$	22,677
Cash paid for interest	$	3	$	4,734
Cash paid for purchases of equipment and leasehold improvements		3,290		1,039

Operating Activities

Our largest source of operating cash is cash collections from our customers for subscriptions. Our primary use of cash from operating activities is for employee-related expenditures, marketing expenses and third-party hosting costs.

For the three months ended March 31, 2021, net cash provided by operating activities was $4.0 million reflecting our net loss of $3.1 million, adjusted for non-cash charges of $17.3 million and net cash outflows of $10.2 million from changes in our operating assets and liabilities. Non-cash charges primarily consisted of depreciation and amortization of property and equipment and intangible assets, amortization of deferred contract costs, non-cash lease expense, share-based compensation and a $0.3 million adjustment to our Digita earnout, partially offset by the deferred tax benefit. The primary drivers of net cash outflows from changes in operating assets and liabilities included a $7.1 million increase in trade accounts receivable due to higher sales and the timing of cash receipts from our customers, a $6.5 million increase in deferred contract costs due to an increase in capitalized contract costs, a $3.3 million increase in prepaid expenses and other assets and an $8.9 million decrease in accounts payable and accrued liabilities due to the timing of cash disbursements. These changes were partially offset by a $15.5 million increase in deferred revenue due to the upfront billing for a majority of our subscriptions.

For the three months ended March 31, 2020, net cash used in operating activities was $7.4 million reflecting our net loss of $8.3 million, adjusted for non-cash charges of $10.5 million and net cash outflows of $9.5 million from changes in our operating assets and liabilities. Non-cash charges primarily consisted of depreciation and amortization of property and equipment and intangible assets, amortization of deferred contract costs, amortization of debt issuance costs and share-based compensation, partially offset by deferred taxes. The primary drivers of net cash outflows from changes in operating assets and liabilities included an increase in deferred contract costs of $4.8 million, an increase in prepaid expenses and other assets of $2.3 million and a decrease in accounts payable and accrued liabilities of $6.9 million, partially offset by a $5.0 million increase in deferred revenue.

Investing Activities

During the three months ended March 31, 2021, net cash used in investing activities was $6.3 million driven by purchases of $3.3 million in equipment and leasehold improvements primarily reflecting updates to office space and hardware and software and the acquisition of cmdReporter of $3.0 million.

During the three months ended March 31, 2020, net cash used in investing activities was $1.0 million driven by purchases of equipment and leasehold improvements to support our higher headcount with additional office space and hardware and software.

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Financing Activities

Net cash provided by financing activities of $4.0 million during the three months ended March 31, 2021 was due to proceeds from the exercise of stock options.

Net cash used in financing activities of $1.4 million during the three months ended March 31, 2020 was due to the payment of offering costs of $1.5 million, partially offset by $0.1 million of proceeds from the exercise of stock options.

Contractual Obligations and Commitments

As of March 31, 2021, our principal commitments consist of obligations under operating leases for office space. In “Management’s Discussion and Analysis of Financial Conditions and Results of Operations” included in our Annual Report on Form 10-K, we disclosed our total contractual obligations as of December 31, 2020. Outside of the above and routine transactions made in the ordinary course of business, there have been no material changes to the contractual obligations as disclosed in our Annual Report on Form 10-K.

Indemnification Agreements

In the ordinary course of business, we enter into agreements of varying scope and terms pursuant to which we agree to indemnify customers, channel partners, vendors, lessors, business partners and other parties with respect to certain matters, including, but not limited to, losses arising out of the breach of such agreements, services to be provided by us or from intellectual property infringement, misappropriation or other violation claims made by third parties. See “Risk Factors — We have indemnity provisions under our contracts with our customers, channel partners and other third parties, which could have a material adverse effect on our business” in our Annual Report on Form 10-K. In addition, we have entered into indemnification agreements with our directors and certain executive officers that will require us, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as directors, officers or employees. No demands have been made upon us to provide indemnification under such agreements and there are no claims that we are aware of that could have a material effect on our consolidated balance sheets, consolidated statements of operations and comprehensive loss, or consolidated statements of cash flows.

JOBS Act

We qualify as an “emerging growth company” pursuant to the provisions of the JOBS Act. For as long as we are an “emerging growth company,” we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging growth companies,” including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404(b) of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, exemptions from the requirements of holding advisory “say-on-pay” votes on executive compensation and shareholder advisory votes on golden parachute compensation.

The JOBS Act also permits an emerging growth company like us to take advantage of an extended transition period to comply with new or revised accounting standards applicable to public companies. We have elected to use the extended transition period for complying with new or revised accounting standards and, therefore, we will not be subject to the same new or revised accounting standards as other public companies that comply with such new or revised accounting standards on a non-delayed basis.

Critical Accounting Policies

Our discussion and analysis of financial condition and results of operations are based upon our consolidated financial statements. The preparation of our financial statements in accordance with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses. We base our estimates on experience and other assumptions that we believe are reasonable under the circumstances, and we evaluate these estimates on an ongoing basis. Actual results may differ from those estimates, impacting our reported results of operations and financial condition.

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Except for the accounting policies for leases that were updated as a result of adopting the new accounting standard, there have been no material changes to our critical accounting policies and estimates disclosed in our Annual Report on Form 10-K. For more information, refer to “Note 2 — Summary of Significant Accounting Policies” to the consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

Recent Accounting Pronouncements

For a description of our recently adopted accounting pronouncements and recently issued accounting standards not yet adopted, see “Note 2 — Summary of Significant Accounting Policies” to the consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Market risk represents the risk of loss that may impact our financial position due to adverse changes in financial market prices and rates. Our market risk exposure is primarily a result of exposure due to potential changes in inflation or interest rates. We do not hold financial instruments for trading purposes.

Foreign Currency Exchange Risk

The functional currency of our foreign subsidiaries is the U.S. dollar. Most of our sales are denominated in U.S. dollars, and therefore our revenue is not currently subject to significant foreign currency risk. Our operating expenses are denominated in the currencies of the countries in which our operations are located, which are primarily in the U.S., Poland, and the Netherlands. Our consolidated results of operations and cash flows are, therefore, subject to fluctuations due to changes in foreign currency exchange rates and may be adversely affected in the future due to changes in foreign exchange rates. To date, we have not entered into any hedging arrangements with respect to foreign currency risk or other derivative financial instruments. During the three months ended March 31, 2021 and 2020, a hypothetical 10% change in foreign currency exchange rates applicable to our business would not have had a material impact on our consolidated financial statements.

Impact of Inflation

While inflation may impact our net revenue and costs of revenue, we believe the effects of inflation, if any, on our results of operations and financial condition have not been significant. However, there can be no assurance that our results of operations and financial condition will not be materially impacted by inflation in the future.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We maintain “disclosure controls and procedures,” as defined in Rule 13a–15(e) and Rule 15d–15(e) under the Exchange Act, that are designed to provide reasonable assurance that information required to be disclosed by the Company in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to provide reasonable assurance that information required to be disclosed by the Company in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. Based on such evaluation, our principal executive officer and principal financial officer have concluded that as of March 31, 2021, our disclosure controls and procedures were effective at the reasonable assurance level.

Changes in Internal Control

There have been no changes in internal control over financial reporting during the quarter ended March 31, 2021 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II

OTHER INFORMATION

Item 1. Legal Proceedings

We are not presently a party to any litigation the outcome of which, we believe, if determined adversely to us, would individually or taken together have a material adverse effect on our business, operating results, cash flows or financial condition.

Item 1A. Risk Factors

This quarterly report should be read in conjunction with the risk factors included in our Annual Report on Form 10-K. Except for the risk factors set forth below that are new or contain changes to the similarly titled risk factors included in our Annual Report on Form 10-K, there have been no material changes to the risk factors disclosed in Part 1, Item 1A “Risk Factors” in our Annual Report on Form 10-K.

Risks Related to the Proposed Acquisition of Wandera

Our ability to complete the acquisition of Wandera is subject to various closing conditions, approvals from governmental authorities, which may impose conditions that could adversely affect us or cause the acquisition not to be completed.

On May 11, 2021, we entered into the Merger Agreement for the acquisition of Wandera, a leader in zero trust cloud security and access for mobile devices. The acquisition is subject to a number of customary conditions to closing as specified in the Merger Agreement. These closing conditions include, among others, the receipt of required approvals under U.S. competition laws, and the absence of governmental or other legal restraints or prohibitions preventing the consummation of the acquisition. No assurance can be given that the required regulatory approvals will be obtained or that the required conditions to closing will be satisfied, and, if all required consents and approvals are obtained and the required conditions are satisfied, no assurance can be given as to the terms, conditions and timing of such consents and approvals. Any delay in completing the acquisition could cause the combined company not to realize, or to be delayed in realizing, some or all of the benefits that we and Wandera expect to achieve if the acquisition is successfully completed within its expected time frame. Additionally, either we or Wandera may terminate the Merger Agreement under certain circumstances, including, among other reasons, if the acquisition is not completed by August 3, 2021.

We can provide no assurance that the various closing conditions will be satisfied and that the necessary approvals will be obtained, or that any required conditions will not materially adversely affect the combined company following the acquisition. In addition, we can provide no assurance that these conditions will not result in the abandonment or delay of the acquisition. The occurrence of any of these events individually or in combination could have a material adverse effect on our results of operations and the trading price of our common stock.

The termination of the Merger Agreement could negatively impact our business.

If the acquisition is not completed for any reason, our ongoing business may be adversely affected and, without realizing any of the expected benefits of having completed the acquisition, we would be subject to a number of risks, including the following:

• we may experience negative reactions from the financial markets, including negative impacts on our stock price;

• we may experience negative reactions from our customers, suppliers, distributors and employees;

• we will be required to pay our costs relating to the acquisition, such as legal, advisory, and accounting costs and associated fees and expenses, whether or not the acquisition is completed;

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• we could be subject to time-consuming and costly litigation related to the acquisition; and

• matters relating to the acquisition (including integration planning) require substantial commitments of time and resources by our management, which could otherwise have been devoted to day-to-day operations or to other opportunities that may have been beneficial to our business.

Whether or not the acquisition is completed, the announcement and pendency of the acquisition could cause disruptions in our and Wandera’s business, which could have an adverse effect on our business and financial results.

Whether or not the acquisition is completed, the announcement and pendency of the acquisition could cause disruptions in our and Wandera’s business. Specifically:

• disruptions to ongoing operations;

• retaining and motivating key Wandera personnel;

• declining employee morale and retention issues affecting Wandera employees, which may result from changes in management, reporting relationships, or other changes to employment relationships;

• maintaining good relationships with customers or business partners of Wandera or our own customers as a result of the acquisition announcement, any uncertainty regarding completion of the acquisition, and any integration of operations; and

• the attention of our and Wandera’s management may be directed toward the completion of the acquisition.

We have diverted significant management resources in an effort to complete the acquisition. If the acquisition is not completed, we will have incurred significant costs, including the diversion of management resources, for which we will have received little or no benefit.

We will incur significant acquisition-related costs in connection with the Wandera acquisition, and we could incur substantial expenses related to the integration of Wandera.

We have incurred and expect to incur a number of non-recurring costs associated with combining the operations of the two companies, as well as transaction fees and other costs related to the acquisition. These costs and expenses include fees paid to financial, legal and accounting advisors, potential employment-related costs, filing fees, and other related charges. We will need to pay some of these costs regardless of whether the acquisition is completed.

We will also incur integration costs in connection with the acquisition. There are a large number of processes, policies, procedures, operations, technologies and systems that must be integrated in connection with the acquisition and the integration of Wandera’s business. Although we expect that the elimination of duplicative costs, strategic benefits, and additional income, as well as the realization of other efficiencies related to the integration of the businesses, may offset incremental transaction and acquisition-related costs over time, any net benefit may not be achieved in the near term or at all. We will bear many of these costs even if the acquisition is not completed. While we have assumed that certain expenses would be incurred in connection with the acquisition and the other transactions contemplated by the Merger Agreement, there are many factors beyond our control that could affect the total amount or the timing of the integration and implementation expenses.

Integrating Wandera’s business may be more difficult, costly or time-consuming than expected and we may fail to realize the anticipated benefits of the acquisition, which may adversely affect our business results and negatively affect the value of our common stock.

The success of the acquisition will depend on, among other things our ability to integrate Wandera’s businesses in a manner that facilitates growth opportunities and realizes expected cost savings. We may encounter difficulties in integrating our and Wandera’s businesses and realizing the anticipated benefits of the acquisition. We must achieve

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anticipated post-closing growth and cost savings without adversely affecting current revenues and investments in future growth. If we are not able to successfully achieve these objectives, the anticipated benefits of the acquisition may not be realized fully, or at all, or may take longer to realize than expected.

The acquisition involves the combination of two companies which currently operate, and until the completion of the acquisition will continue to operate, as independent companies. There can be no assurances that our respective businesses can be integrated successfully. It is possible that the integration process could result in the loss of key employees from both companies, the loss of customers, the disruption of our, Wandera’s or both companies’ ongoing businesses, inconsistencies in standards, controls, procedures and policies, unexpected integration issues, higher than expected integration costs and an overall post-completion integration process that takes longer than originally anticipated. We will be required to devote management attention and resources to business integration efforts, and prior to the acquisition, management attention and resources will be required to plan for such integration. Potential difficulties we may encounter in the integration process include the following:

• lost sales and customers as a result of certain of our and/or Wandera’s customers deciding not to do business with us post-close;

• differences in customer and vendor composition, sales cycles, and other business dissimilarities;

• integrating personnel from the two companies while maintaining focus on providing consistent, high-quality products and services, especially in the COVID-19 environment;

• potential unknown liabilities and unforeseen increased expenses, delays or regulatory conditions associated with the acquisition; and

• our and/or Wandera’s performance shortfalls as a result of the diversion of management’s attention caused by completing the acquisition and integrating the companies’ operations.

Any of these factors could result in us failing to realize the anticipated benefits of the acquisition, on the expected timeline or at all. An inability to realize the full extent of the anticipated benefits of the acquisition and the other transactions contemplated by the Merger Agreement, as well as any delays encountered in the integration process, could have an adverse effect upon the revenues, level of expenses and our operating results, which may adversely affect the value of our common stock.

In addition, the actual integration may result in additional and unforeseen expenses, and the anticipated benefits of the integration plan may not be realized. Actual growth and cost savings, if achieved, may be lower than what we expect and may take longer to achieve than anticipated. If we are not able to adequately address integration challenges, we may be unable to successfully integrate their operations or realize the anticipated benefits of such integration.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

None.

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Item 6. Exhibits

The following is a list of all exhibits filed or furnished as part of this report:

Exhibit Number	Description
2.1	Agreement and Plan of Merger, dated as of May 5, 2021, by and among JAMF Holding Corp., JAMF Software, LLC, White Wolf Merger Sub, Inc., Wandera, Inc., and Shareholder Representative Services LLC, filed herewith.
10.1	First Amendment, dated as of April 22, 2021, to the Letter Agreement between JAMF Holdings, Inc. and Dean Hager (incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on April 26, 2021).
10.2	First Amendment, dated as of April 22, 2021, to the Letter Agreement between JAMF Holdings, Inc. and Jill Putman (incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on April 26, 2021).
10.3	First Amendment, dated as of April 22, 2021, to the Letter Agreement between JAMF Holdings, Inc. and John Strosahl (incorporated by reference to the Company’s Current Report on Form 8-K filed with the SEC on April 26, 2021).
31.1	Certification of the Chief Executive Officer pursuant to Exchange Act Rules Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, filed herewith.
31.2	Certification of the Chief Financial Officer pursuant to Exchange Act Rules Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, filed herewith.
32.1*	Certification of the Chief Executive Officer pursuant to 18 U.S.C. Section 1350, filed herewith.
32.2*	Certification of the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, filed herewith.
101.INS	Inline XBRL Instance Document
101.SCH	Inline XBRL Taxonomy Extension Schema Document
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document
104	Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)

* The certifications furnished in Exhibit 32.1 and Exhibit 32.2 hereto are deemed to accompany this Quarterly Report on Form 10-Q and will not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, except to the extent that the registrant specifically incorporates it by reference.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	Jamf Holding Corp. (Registrant)
Date:     May 11, 2021	By:	/s/ Ian Goodkind
		Ian Goodkind
		Chief Accounting Officer (Principal Accounting Officer)

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