Company: APPN
Filing Date: 2025-08-07
Form Type: 10-Q
Source: 0001441683-25-000053
Chunk: 136

Company: APPIAN CORP
Filing Date: 2025-08-07
Form: 10-Q
Item: Item 2
Chunk 136
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30,20252024$ Change% Change(dollars in thousands)Cost of revenueSubscriptions$32,048$25,532$6,516 25.5 %Professional services50,79151,878(1,087)(2.1)Total cost of revenue$82,839$77,410$5,429 7.0 %Subscriptions gross margin88.0 %88.9 %Professional services gross margin27.5 %20.9 %Total gross margin75.4 %73.9 %

Cost of revenue increased $5.4 million, or 7%, in the six months ended June 30, 2025 compared to the same period in 2024, primarily due to a $5.8 million increase in hosting costs coupled with a $2.4 million increase in 

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contractor costs. These increases were partially offset by a $2.5 million decrease in professional services and product support personnel costs. Hosting costs increased due to an increase in sales of our cloud offering during the six months ended June 30, 2025, while contractor costs increased due to an increase in the usage of subcontractors for professional services engagements. Professional services and product support personnel costs decreased due to a decrease in cost of sales headcount of 8% from June 30, 2024 to June 30, 2025.

Sales and Marketing Expense

Six Months Ended June 30,20252024$ Change% Change(dollars in thousands)Sales and marketing$115,011$124,748$(9,737)(7.8)%% of revenue34.1 %42.1 %

Sales and marketing expense decreased $9.7 million, or 8%, in the six months ended June 30, 2025 compared to the same period in 2024, primarily due to a $7.3 million decrease in sales and marketing personnel costs, a $1.6 million decrease in allocated costs such as rent and employee medical costs, and a $0.7 million decrease in marketing expenses. These decreases were partially offset by a $0.7 million increase in travel and entertainment costs and a $0.6 million increase in contractor costs. Sales and marketing personnel costs decreased due to a decrease in sales and marketing headcount of 25% from June 30, 2024 to June 30, 2025. Travel and entertainment