Acquisitions

12 Months Ended

Jan. 31, 2026

Acquisitions

Note 3 – Acquisitions

Fiscal 2026 Acquisitions

On March 24, 2025, Descartes acquired all of the shares of SEP 3GTMS Topco, Inc. and its subsidiaries (collectively referred to as “3GTMS”), a provider of transportation management solutions. The purchase price for the acquisition was approximately $112.7 million, net of cash acquired, which was funded from cash on hand. The gross contractual amount of trade receivables acquired was $3.4 million with a fair value of $2.8 million at the date of acquisition. Our acquisition date estimate of contractual cash flows not expected to be collected was $0.6 million. The purchase price was finalized in the three month period ended January 31, 2026 with no adjustments.

On June 18, 2025, Descartes acquired all of the shares of PackageRoute Holdco, Inc. (“PackageRoute”), a provider of final-mile carrier solutions. The purchase price for the acquisition was approximately $1.9 million, net of cash acquired, which was funded from cash on hand. The gross contractual amount of trade receivables acquired was nominal with a nominal fair value at the date of acquisition. Our acquisition date estimate of contractual cash flows not expected to be collected was nominal. The completion of the initial purchase price allocation is pending the finalization of the fair value for trade receivables, accrued liability balances, deferred revenue as well as potential unrecorded liabilities. We expect to finalize the purchase price allocation on or before June 18, 2026.

On August 1, 2025, Descartes acquired all of the shares of Finale, Inc. (“Finale”), a US-based provider of cloud-based inventory management solutions designed to support ecommerce businesses across their growth lifecycle. The purchase price for the acquisition was approximately $39.2 million, net of cash acquired, which was funded from cash on hand, plus potential performance-based contingent consideration of up to $15.0 million based on Finale achieving revenue-based targets over the first two years post-acquisition. The fair value of the contingent consideration was valued at $3.6 million at the acquisition date. The gross contractual amount of trade receivables acquired was $0.1 million with a fair value of $0.1 million at the date of acquisition. Our acquisition date estimate of contractual cash flows not expected to be collected was nominal. The completion of the initial purchase price allocation is pending the finalization of the fair value for trade receivables, accrued liability balances, deferred revenue as well as potential unrecorded liabilities. We expect to finalize the purchase price allocation on or before August 1, 2026.

For the businesses acquired during fiscal 2026, we incurred acquisition-related costs of $3.4 million for the year ended January 31, 2026. The acquisition-related costs were primarily for advisory services and are included in other charges in our consolidated statements of operations. During the year ended January 31, 2026, we have recognized revenues of $25.8 million, and net loss of $1.2 million, from 3GTMS, PackageRoute, and Finale since the date of acquisition in our consolidated statements of operations.

The final purchase price allocation for 3GTMS and the preliminary purchase price allocations for PackageRoute and Finale, which have not been finalized, are as follows:


				Package-
		3GTMS		Route		Finale		Total
Purchase price consideration:
Cash, net of cash acquired related to 3GTMS ($773), PackageRoute ($191) and Finale ($250)		112,714		1,890		37,016		151,620
Consideration payable		—		—		2,172		2,172
Contingent consideration		—		—		3,597		3,597
Net working capital adjustments (receivable)		(123)		(38)		(72)		(233)
		112,591		1,852		42,713		157,156
Allocated to:
Current assets, excluding cash acquired		3,773		4		386		4,163
Deferred income tax asset		7,510		—		—		7,510
Other long-term assets		686		—		—		686
Current liabilities		(2,732)		(84)		(61)		(2,877)
Deferred revenue		(6,811)		(68)		(1,609)		(8,488)
Net tangible assets (liabilities) assumed		2,426		(148)		(1,284)		994

Finite life intangible assets acquired:
Customer agreements and relationships		29,000		2,000		8,600		39,600
Existing technology		30,700		—		12,500		43,200
Trade names		350		—		100		450
Non-compete covenants		—		—		250		250
Goodwill		50,115		—		22,547		72,662
		112,591		1,852		42,713		157,156

The above transactions were accounted for using the acquisition method in accordance with ASC Topic 805, “Business Combinations”. The purchase price allocations in the table above represents our estimates of the allocation of the purchase price and the fair value of net assets acquired. The preliminary purchase price allocations may differ from the final purchase price allocation, and these differences may be material. Revisions to the allocations will occur as additional information about the fair value of assets and liabilities becomes available.

The acquired intangible assets are being amortized over their estimated useful lives as follows:


				Package-
		3GTMS		Route		Finale
Customer agreements and relationships		10-13 years		13 years		10 years
Existing technology		6 years		N/A		6 years
Trade names		3 years		N/A		3 years
Non-compete covenants		N/A		N/A		5 years

The goodwill on the 3GTMS and Finale acquisitions arose as a result of the combined strategic value to our growth plan. The goodwill arising from the 3GTMS acquisition is not deductible for tax purposes. The goodwill arising from the Finale acquisition is deductible for tax purposes.

Fiscal 2025 Acquisitions

On March 28, 2024, Descartes acquired all of the shares of OCR Services, Inc. (“OCR”), a provider of global trade compliance solutions and content. The purchase price for the acquisition was approximately $82.8 million, net of cash acquired, which was funded from cash on hand. The gross contractual amount of trade receivables acquired was $4.7 million with a fair value of $3.9 million at the date of acquisition. Our acquisition date estimate of contractual cash flows not expected to be collected was $0.8 million. The purchase price was finalized in the three month period ended April 30, 2025 with no adjustments.

On April 19, 2024, Descartes acquired substantially all of the shares of Aerospace Software Developments (“ASD”), a provider of global trade compliance solutions and content. The purchase price for the acquisition was approximately $62.5 million (EUR 58.7 million), net of cash acquired, which was substantially paid at closing from cash on hand with the remaining $3.6 million paid in the fourth quarter of fiscal 2025. The gross contractual amount of trade receivables acquired was $1.1 million with a fair value of $1.1 million at the date of acquisition. Our acquisition date estimate of contractual cash flows not expected to be collected was nominal. The purchase price was finalized in the three month period ended April 30, 2025 with no adjustments.

On June 10, 2024, Descartes acquired all of the shares of BoxTop Technologies Limited (“BoxTop”), a provider of shipment management solutions for small- to mid-sized logistics services providers. The purchase price for the acquisition was approximately $12.1 million (GBP 9.5 million), net of cash acquired, which was funded from cash on hand. The gross contractual amount of trade receivables acquired was nominal with a nominal fair value at the date of acquisition. Our acquisition date estimate of contractual cash flows not expected to be collected was nominal. The purchase price was finalized in the three month period ended July 31, 2025 with no adjustments.

On September 17, 2024, Descartes acquired all of the shares of Assure Assist, Inc., doing business as MyCarrierPortal (“MCP”), a provider of carrier onboarding and risk monitoring solutions for the trucking industry. The purchase price for the acquisition was approximately $22.5 million, net of cash acquired, which was funded from cash on hand, plus potential performance-based consideration of up to $6.0 million based on MCP achieving revenue-based targets over the first two years post-acquisition. The fair value of the contingent consideration was valued at $1.7 million at the acquisition date. The gross contractual amount of trade receivables acquired was nominal with a nominal fair value at the date of acquisition. Our acquisition date estimate of contractual cash flows not expected to be collected was nominal. The purchase price was finalized in the three month period ended October 31, 2025 with no adjustments.

On October 11, 2024, Descartes acquired all of the shares of Sellercloud LLC and certain assets of Sellercloud Europe Ltd. (collectively referred to as “Sellercloud”), a provider of omnichannel ecommerce solutions. The purchase price for the acquisition was approximately $110.2 million, net of cash acquired, which was funded from cash on hand, plus potential performance-based consideration of up to $20.0 million based on Sellercloud achieving revenue-based targets over the first two years post-acquisition. The fair value of the contingent consideration was valued at $5.4 million at the acquisition date. The gross contractual amount of trade receivables acquired was $1.0 million with a fair value of $1.0 million at the date of acquisition. Our acquisition date estimate of contractual cash flows not expected to be collected was nominal. The purchase price was finalized in the three month period ended October 31, 2025 with no adjustments.

The final purchase price allocations for businesses we acquired in 2025 are as follows:


										Seller-
		OCR		ASD		BoxTop		MCP		cloud		Total
Purchase price consideration:
Cash, net of cash acquired related to OCR ($5,743), ASD ($2,475), BoxTop ($1,012), MCP ($2,105) and Sellercloud ($362)		82,849		62,522		12,111		22,508		110,214		290,204
Contingent consideration		—		—		—		1,679		5,364		7,043
Net working capital adjustments (receivable) / payable		160		124		(19)		(225)		268		308
		83,009		62,646		12,092		23,962		115,846		297,555
Allocated to:
Current assets, excluding cash acquired		4,666		4,445		58		17		944		10,130
Deferred income tax assets		77		—		—		—		—		77
Right-of-use assets		59		—		186		—		—		245
Other long-term assets		13		6		1		—		5		25
Current liabilities		(907)		(1,108)		(488)		(1,168)		(376)		(4,047)
Deferred revenue		(11,145)		(330)		(454)		(1,816)		(236)		(13,981)
Lease obligations		(59)		—		(186)		—		—		(245)
Deferred income tax liabilities		(13,107)		(3,319)		(1,743)		—		—		(18,169)
Net tangible assets (liabilities) assumed		(20,403)		(306)		(2,626)		(2,967)		337		(25,965)

Finite life intangible assets acquired:
Customer agreements and relationships		24,200		12,247		2,926		4,900		17,300		61,573
Existing technology		25,000		14,377		3,944		8,300		25,200		76,821
Trade names		1,500		298		25		150		250		2,223
Non-compete covenants		600		426		76		150		700		1,952
Goodwill		52,112		35,604		7,747		13,429		72,059		180,951
		83,009		62,646		12,092		23,962		115,846		297,555

The acquired intangible assets are being amortized over their estimated useful lives as follows:


										Seller-
		OCR		ASD		BoxTop		MCP		cloud
Customer agreements and relationships		13 years		13 years		13 years		8 years		12 years
Existing technology		6 years		6 years		6 years		6 years		6 years
Trade names		10 years		3-6 years		2 years		3 years		3 years
Non-compete covenants		5 years		5 years		5 years		5 years		5 years

The goodwill on the OCR, ASD, BoxTop, MCP and Sellercloud acquisitions arose as a result of the combined strategic value to our growth plan. The goodwill arising from the OCR, ASD and BoxTop acquisitions are not deductible for tax purposes. The goodwill arising from the MCP and Sellercloud acquisitions are deductible for tax purposes.

Fiscal 2024 Acquisitions

On February 14, 2023, Descartes acquired all of the shares of Windigo Logistics, Inc., doing business as GroundCloud (“GroundCloud”), a cloud-based provider of final-mile carrier solutions and road safety compliance tools. The purchase price for the acquisition was approximately $136.8 million, net of cash acquired, which was funded from cash on hand, plus potential performance-based contingent consideration of up to $80.0 million based on GroundCloud achieving revenue-based targets over the first two years post-acquisition. The fair value of the contingent consideration was valued at $19.6 million at the acquisition date. The gross contractual amount of trade receivables acquired was $1.5 million with a fair value of $1.5 million at the date of acquisition. Our acquisition date estimate of contractual cash flows not expected to be collected was nominal. The purchase price was finalized in the three month period ended January 31, 2024 with no adjustments.

On April 20, 2023, Descartes acquired substantially all of the assets of Localz Pty Ltd.(“Localz”), a cloud-based customer engagement platform for day-of-service interaction and order management. The purchase price for the acquisition was approximately $5.9 million, net of cash acquired, which was funded from cash on hand. The gross contractual amount of trade receivables acquired was $0.6 million with a fair value of $0.6 million at the date of acquisition. Our acquisition date estimate of contractual cash flows not expected to be collected was nominal. The purchase price was finalized in the three month period ended April 30, 2024 with no adjustments.

The final purchase price allocations for businesses we acquired in 2024 are as follows:


		Ground-
		Cloud		Localz		Total
Purchase price consideration:
Cash, less cash acquired related to GroundCloud ($4,381) and Localz (Nil)		136,843		5,857		142,700
Contingent consideration		19,550		—		19,550
Net working capital adjustments (receivable) / payable		458		(5)		453
		156,851		5,852		162,703
Allocated to:
Current assets, excluding cash acquired		3,245		619		3,864
Right-of-use Assets		144		—		144
Current liabilities		(3,308)		(227)		(3,535)
Deferred revenue		(136)		(1,465)		(1,601)
Lease obligations		(144)		—		(144)
Net tangible assets (liabilities) assumed		(199)		(1,073)		(1,272)

Finite life intangible assets acquired:
Customer agreements and relationships		29,400		—		29,400
Existing technology		42,800		5,971		48,771
Trade names		1,100		—		1,100
Non-compete covenants		1,000		—		1,000
Goodwill		82,750		954		83,704
		156,851		5,852		162,703

The acquired intangible assets are being amortized over their estimated useful lives as follows:


		GroundCloud		Localz
Customer agreements and relationships		13 years		N/A
Existing technology		6 years		6 years
Trade names		6 years		N/A
Non-compete covenants		5 years		N/A

The goodwill on the GroundCloud and Localz acquisitions arose as a result of the combined strategic value to our growth plan. The goodwill arising from the GroundCloud and Localz acquisitions is deductible for tax purposes.

Pro Forma Results of Operations (Unaudited)

The financial information in the table below summarizes selected results of operations on a pro forma basis as if we had acquired Finale, PackageRoute, 3GTMS, Sellercloud, MCP, BoxTop, ASD, OCR, Localz, and GroundCloud as of February 1, 2023.

This pro forma information is for information purposes only and does not purport to represent what our actual results of operations for the periods presented would have been had the acquisitions of Finale, PackageRoute, 3GTMS, Sellercloud, MCP, BoxTop, ASD, OCR, Localz, and GroundCloud occurred at February 1, 2023, or to project our results of operations for any future period.


		January 31,		January 31,		January 31,
Year Ended		2026		2025		2024
Revenues		737,588		710,816		657,947
Net income		163,401		139,239		100,216
Earnings per share
Basic		1.90		1.63		1.18
Diluted		1.87		1.59		1.15