v3.26.3
Acquisitions
 9 Months Ended
Sep. 30, 2026
Business Combination, Asset Acquisition, Transaction between Entities under Common Control, and Joint Venture Formation [Abstract]  
Acquisitions Acquisitions
Infrascale, Inc.
On July 29, 2026 (the “Closing Date”), N-able Technologies Ltd, a wholly owned subsidiary of the Company, entered into an Asset Purchase Agreement (the “APA”) with Infrascale, Inc. (“Infrascale”) and acquired certain customer contracts, customer lists, and related contract rights (the “Acquired Contracts”). We did not acquire Infrascale’s software, source code, or employees. Under the APA, we received a perpetual, non-exclusive, non-transferable, royalty-free license to distribute the Infrascale backup products solely to the customers party to the Acquired Contracts (the “Acquired Customers”), and we intend
to migrate the Acquired Customers to our Cove data protection solution. Because substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset, we accounted for the transaction as an asset acquisition rather than a business combination, and no goodwill was recognized.
Consideration consists of $3.0 million in cash paid at closing and contingent consideration based on Converted ARR (as defined in the APA), measured quarterly over the 36 months following the Closing Date. Contingent payments are equal to 100% of Converted ARR in excess of $3.0 million up to $6.0 million, plus 125% of any Converted ARR in excess of $6.0 million.
Contingent consideration is recognized when payment becomes probable and the amount can be reasonably estimated, with a corresponding increase to the cost of the acquired intangible asset. As of September 30, 2026, we concluded that payment of contingent consideration was not probable, and accordingly no liability has been recorded. Future payments, if any, will depend on the number of Acquired Customers that migrate to our solutions and the resulting Converted ARR, and we are not able to reasonably estimate the amount of such payments at this time.
The total cost of the acquisition of $3.0 million was allocated to a single customer relationships intangible asset, which is being amortized on a straight-line basis over its estimated useful life of 36 months. No transaction costs were capitalized. We recognized $0.2 million of amortization expense related to this asset during the three and nine months ended September 30, 2026, which is included in amortization of acquired intangibles in our Consolidated Statements of Operations.
Adlumin, Inc.
On November 20, 2024, we acquired Adlumin, Inc. (“Adlumin”) a Washington, D.C. based enterprise-grade security operations platform provider. The aggregate consideration payable at closing of the transaction included $98.7 million in cash and the issuance of up to 1,570,762 shares of our common stock. Additionally, the former Adlumin shareholders have the right to receive $120.0 million in cash in installments of $52.5 million and $67.5 million on the first and second anniversaries of the closing date, respectively, and up to an aggregate of $30.0 million in potential cash earn-out payments payable in 2025 and 2026 based upon the achievement of certain performance metrics against defined targets for the 2024 and 2025 fiscal years.
The following table summarizes the amounts recognized for the assets acquired and liabilities assumed:
(in thousands)
Current liabilities, net, including cash acquired of $52
$(9,071)
Property and equipment, net182 
Non-current liabilities, net(4,754)
Identifiable intangible assets
Developed technology74,800 
Customer relationships5,400 
Trademarks300 
Goodwill160,498 
Total assets acquired, net$227,355 
The results of operations related to Adlumin since the acquisition date are included in our Consolidated Financial Statements. Of the $120.0 million of deferred consideration, $7.0 million and $7.8 million are contingent upon certain employees’ continued employment on the first and second anniversaries of the closing date, respectively. The amounts associated with continued employment are accounted for as compensation expense for post-combination services. During the year ended December 31, 2025, we paid $6.2 million of such amounts in connection with the first anniversary of the closing date. Of the remaining $105.2 million of deferred consideration, $45.5 million and $59.7 million are required to be paid on the first and second anniversary dates of the closing, respectively, based upon the passage of time and were recorded at fair value as of the date of the transaction. During the year ended December 31, 2025, we paid $45.5 million of such amounts in connection with the first anniversary of the closing date.
At the date of acquisition, the fair value of the deferred consideration was $96.3 million. As of September 30, 2026, the fair value of the deferred consideration, net of payments of $51.7 million, was $65.7 million, resulting in the recognition of expense of $1.7 million and $5.0 million for the three and nine months ended September 30, 2026, respectively. We recognized $0.9 million and $2.6 million in general and administrative expense related to the service-based portion of deferred consideration, and $0.8 million and $2.4 million in interest expense related to the time-based portion of the deferred consideration, for the three and nine months ended September 30, 2026, respectively.
At the date of acquisition, the fair value of the contingent consideration was $16.6 million. The earn-out arrangement provided for up to $15.0 million in potential cash payments for each of the 2024 and 2025 fiscal years, based upon the achievement of certain performance metrics against defined targets. In June 2025, we made a cash earn-out payment of
$5.4 million related to the 2024 fiscal year performance metrics. During the three months ended June 30, 2026, we made a cash earn-out payment of $10.5 million related to the 2025 fiscal year performance metrics, which was the second and final cash earn-out payment. Immediately prior to this payment, the fair value of the remaining contingent consideration was $10.5 million, resulting in the recognition of a gain of $0.3 million for the nine months ended September 30, 2026. As of September 30, 2026, the contingent consideration has been paid in full.
See Note 6. Fair Value Measurements, Note 7. Accrued Liabilities and Other and Note 11. Commitments and Contingencies for additional information regarding the deferred and contingent consideration liabilities.
We recognize revenue on the acquired products in accordance with our revenue recognition policy as described in Note 2. Summary of Significant Accounting Policies.