Company: FORA
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001140361-25-042313
Chunk: 32

Company: Forian Inc.
Filing Date: 2025-11-14
Form: 10-Q
Item: Item 8
Chunk 32
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 Australia, (9%).

   Sales for the nine months ended September 30, 2025 by country as a percentage of total sales were: United States (94%) and Great Britain/others, (6%), compared to sales for the nine months ended September 30, 2024 by country as a percentage of total sales which were United States, (90%); Canada, (2%); and Australia, (8%).

   Cost of Revenues

   Cost of revenues is generated from direct costs associated with the delivery of the Company’s products and services to its customers. The cost of revenues relates primarily to labor costs, information licensing, hosting and infrastructure costs and client service team costs.

   On July 31, 2024, the Company was informed by one of its information vendors that effective December 31, 2024, the vendor will no longer include certain data within the information products it licenses to the Company. The vendor stated this was due to clarifications and updates to the licensing relationship between the vendor and one of its data suppliers. In February 2025, the vendor announced that it intended to exit the data licensing business by the end of 2026. The Company plans to license data from additional vendors in consideration of the above changes; however, there can be no assurance that the alternate sources of comparable data can be obtained, and if so, on terms and conditions substantially equivalent to those under the Company’s previous agreement. As a result of this event, the Company is evaluating its rights under the contract and the impact of the vendors announced wind down on future obligations under the agreement. The Company reduced the expected period of benefit under the agreement effective with the vendors announcement. The resulting change in accounting estimate did not have a material impact on operating results for the three and nine months ended September 30, 2025.

   On September 23, 2024, the Company was informed by one of its information vendors that it was exercising the right to terminate the agreement with the Company effective September 25, 2024, based on restrictions imposed by the information vendor’s upstream licensor. As a result, the Company recorded an adjustment of $542,389 included in cost of revenues during the year ended December 31, 2024, representing previously recorded charges under the contract that will not be paid. On July 2, 2025, the Company entered into a Termination and Wind Down Agreement with the vendor providing for a reduction of fees for the period through the termination date of $175,000.