Company: IBTA
Filing Date: 2025-11-13
Form Type: 10-Q
Source: 0001628280-25-051720
Chunk: 91

Company: Ibotta, Inc.
Filing Date: 2025-11-13
Form: 10-Q
Item: Item 1
Chunk 91
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. The Company is currently evaluating the impact this guidance will have on our financial statements and related disclosures.The Company reviewed all other recently issued accounting standards and determined they were either not applicable or are not expected to have a material impact on our consolidated financial statements.

3. User Redemption Liability Extinguishment

The Company reflects a user redemption liability in the condensed balance sheets associated with the undistributed earnings of consumers on Ibotta’s D2C properties. A portion of these undistributed earnings is never expected to be cashed out by consumers due to inactivity and will therefore be recognized as breakage by the Company. Consumers’ accounts that have no activity for six months are considered inactive and charged a $3.99 per month maintenance fee until the balance is reduced to zero or new activity ensues. Balances associated with accounts that are deactivated for violation of the Company’s terms of use are also recognized as breakage. The Company estimates breakage at the time of the user redemption and reduces the user redemption liability accordingly. Breakage estimates are made based on historical breakage patterns, and the preparation of estimates includes judgments of the applicability of historical patterns to current and future periods. Breakage is recorded in revenue related to funded awards, as an offset to sales and marketing expense related to self-funded awards, and as an offset to cost of revenue related to gift card purchases and sponsored user awards earned from watching an advertising video.The Company’s breakage is recorded as follows (in thousands):Three months ended September 30,Nine months ended September 30,2025202420252024Revenue$1,850 $3,258 $6,497 $10,888 Cost of revenue34 46 111 161 Sales and marketing276 394 910 1,411 Total breakage$2,160 $3,698 $7,518 $12,460 The user redemption liability was $69.6 million and $74.0 million as of September 30, 2025 and December 31, 2024, respectively. 

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Table of ContentsIbotta, Inc.Notes to Condensed Financial Statements(unaudited)

4. Accrued Expenses

Accrued expenses consist of the following (in thousands):September 30, 2025December 31, 2024Accrued employee expenses$10,897 $14,365 Other accrued expenses5,827 3,600 Total accrued expenses$16,724 $