v3.26.1
BUSINESS COMBINATION
 3 Months Ended
Jun. 30, 2026
Business Combination [Abstract]  
BUSINESS COMBINATION

NOTE 2 – BUSINESS COMBINATION

DigiCert DDoS Protection Business Acquisition

On May 1, 2026, the Company acquired the assets and certain liabilities comprising DigiCert, Inc.'s distributed denial-of-service ("DDoS") protection business pursuant to an Asset Purchase Agreement (the "Acquisition").

The aggregate purchase price was $55.0 million, which consisted of $55.0 million cash consideration paid at closing, pending the final determination of any post-closing net working capital adjustment. The results of operations of the acquired business have been included in the Company's consolidated financial statements from May 1, 2026.

The acquisition has been accounted for as a business combination under Accounting Standards Codification 805, Business Combinations. Goodwill and intangible assets recorded as part of the acquisition are deductible for tax purposes. The Company determined that the results of operations related to the DDoS business are not material. As such, the pro forma information is not required for the period ended June 30, 2026. The following table summarizes the preliminary allocation of the purchase price to the identifiable assets acquired and liabilities assumed based on their estimated fair values as of the acquisition date (in thousands):

Accounts receivable

$

7,539

 

Prepaid expenses and other current assets

 

484

 

Deferred tax assets

 

1,200

 

Operating lease right-of-use assets

 

2,730

 

Property and equipment

 

3,115

 

Customer relationships intangible asset

 

24,300

 

Total assets acquired

$

39,368

 

 

 

 

Accounts payable

$

(512

)

Deferred revenue

 

(4,988

)

Current portion of operating lease liabilities

 

(1,057

)

Other current liabilities

 

(681

)

Long-term deferred revenue

 

(135

)

Operating lease liabilities, net of current portion

 

(1,673

)

Total liabilities assumed

 

(9,046

)

Net identifiable assets acquired

 

30,322

 

Goodwill

 

24,678

 

Total purchase price

$

55,000

 

The fair value of the intangible asset was based on a valuation using an income approach. The underlying assumptions include the estimated cash flows to be generated by the existing customer relationships. This fair value measurement was based on significant inputs not observable in the market and thus represents Level 3 fair value measurement. Customer relationship intangible assets are subject to amortization and will be amortized on a straight-line basis over an estimated useful life of 15 years, representing the period over which the Company expects to benefit from the acquired customer relationships.

From the acquisition date through June 30, 2026, the acquired assets did not contribute material revenue or net income to the Company’s consolidated results of operations.

The purchase price allocation is preliminary because the Company is continuing to evaluate the fair values of certain acquired assets and assumed liabilities and working capital balances. For changes in the valuation of intangible assets between the preliminary and final purchase price allocation, the related amortization is adjusted in the period it occurs. Measurement-period adjustments will be recorded in the period identified, with a corresponding adjustment to goodwill. The Company expects to finalize the acquisition accounting during the measurement period, which may extend up to one year from the acquisition date. Subsequent to the

measurement period, any adjustment to assets acquired or liabilities assumed is included in operating results in the period in which the adjustment is identified.