Company: APPF
Filing Date: 2025-10-30
Form Type: 10-Q
Source: 0001433195-25-000142
Chunk: 30

Company: APPFOLIO INC
Filing Date: 2025-10-30
Form: 10-Q
Item: Part I, Item 1
Chunk 30
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103,745 $77,161 $26,584 34 %Percentage of revenue14.4 %12.3 %14.8 %13.1 %Stock-based compensation, included above$3,443 $2,071 $1,372 66 %$9,336 $5,284 $4,052 77 %Percentage of revenue1.4 %1.0 %1.3 %0.9 %

Sales and marketing expense increased for the three and nine months ended September 30, 2025, compared to the same periods in the prior year. The increase was primarily due to a $8.1 million and $17.4 million increase in personnel-related costs, including stock-based and performance-based compensation, to support growth in the business, combined with a $1.1 million and $3.8 million increase in advertising and promotion expense due to increased targeted go-to-market investment, for the respective three and nine-month periods.

We expect sales and marketing expense for the year ending December 31, 2025 to slightly increase as a percentage of revenue compared to the year ended December 31, 2024.

Research and Product Development

 Three Months EndedSeptember 30,ChangeNine Months EndedSeptember 30,Change 20252024Amount%20252024Amount% (dollars in thousands)Research and product development$54,037 $40,662 $13,375 33 %$144,469 $118,079 $26,390 22 %Percentage of revenue21.7 %19.8 %20.6 %20.0 %Stock-based compensation, included above$9,076 $7,471 $1,605 21 %$24,182 $19,625 $4,557 23 %Percentage of revenue3.6 %3.6 %3.4 %3.3 %

Research and product development expense increased for the three and nine months ended September 30, 2025, compared to the same periods in the prior year. The increase was primarily due to a $11.1 million and $20.3 million increase in personnel-related costs, including stock-based and performance-based compensation, net of capitalized software development costs driven by headcount growth, for the respective three and nine-month periods.

20

We expect research and product development expenses for