Company: IBTA
Filing Date: 2025-08-13
Form Type: 10-Q
Source: 0001538379-25-000010
Chunk: 166

Company: Ibotta, Inc.
Filing Date: 2025-08-13
Form: 10-Q
Item: Item 8
Chunk 166
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 Research and development2,500 4,036 5,647 4,589 General and administrative5,644 13,608 10,463 14,120 Total stock-based compensation$13,642 $44,817 $27,394 $49,662 

(3)Other expense, net is comprised of loss (gain) on disposal of assets and penalties.

Components of Results of Operations

Revenue

We provide a platform to CPG brands to deliver digital promotions to consumers. The majority of our revenues are derived from the fees we charge to clients when consumers redeem offers on the IPN by purchasing promoted products. We also derive revenue from the sale of ad products to clients to promote their offers, as well as from data products.

We expect our redemption revenue to increase as a percentage of revenue as we continue to grow the IPN and ad and other revenue to continue to decrease as a percentage of revenue. 

Cost of revenue

Cost of revenue consists primarily of revenue share with third-party publishers, personnel-related costs attributable to personnel in our engineering department who maintain our platform, data hosting 

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costs, amortization of platform-related software development costs, certain user award costs net of breakage, software licensing costs, and processing fees. Personnel-related costs include salaries, stock-based compensation, benefits, and bonuses. User award costs net of breakage recorded in cost of revenue are associated with awards earned from gift card purchases and sponsored user awards earned from watching an advertising video. Breakage represents the undistributed earnings of D2C consumers that is not expected to be cashed out due to inactivity. User award costs also include user awards that are cashed out and subsequently identified as violating our terms of use.

We expect cost of revenue to increase as we continue to invest in our infrastructure and acquire new publishers and clients. 

Operating expenses

Sales and marketing

Sales and marketing expenses consist primarily of personnel-related costs for our sales and marketing departments, self-funded user awards, net of the related breakage, B2B marketing, media spend, common stock warrant expense, software licensing costs, public relations, and market research. Personnel-related costs include salaries, stock-based compensation, bonuses, benefits, taxes, restructuring charges, and travel. Self-funded user awards are awards related to campaigns and other incentive bonuses on our D2C properties that are funded directly by Ibotta as part of our customer acquisition and retention strategy. 

We expect sales and marketing expenses to increase as we invest in our sales