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jamf-20220331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_________________________________________________

FORM 10-Q

_________________________________________________


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
			For the quarterly period ended March 31, 2022


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
			For the transition period from to

Commission File Number: 001-39399

https://cdn.kscope.io/0296d569c5f358441a52866e13fa9aa5-jamf-20220331_g1.jpg

JAMF HOLDING CORP.

(Exact name of registrant as specified in its charter)


Delaware (State or other jurisdiction of incorporation or organization)						82-3031543 (I.R.S. Employer Identification No.)

100 Washington Ave S, Suite 1100

Minneapolis, MN 55401

(Address of principal executive offices)

(612) 605-6625

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading symbol	Name of each exchange on which registered
Common Stock, $0.001 par value per share	JAMF	The NASDAQ Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer ☒	Accelerated filer ☐	Non-accelerated filer ☐
Smaller reporting company ☐		Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

On April 29, 2022, the registrant had 119,828,395 shares of common stock, $0.001 par value, outstanding.

Table of Contents

JAMF HOLDING CORP.

TABLE OF CONTENTS


		PAGE
PART I.	FINANCIAL INFORMATION

Item 1.	Financial Statements (unaudited)	4
	Condensed Consolidated Balance Sheets — March 31, 2022 and December 31, 2021	4
	Condensed Consolidated Statements of Operations — Three Months Ended March 31, 2022 and 2021	5
	Condensed Consolidated Statements of Comprehensive Loss — Three Months Ended March 31, 2022 and 2021	6
	Condensed Consolidated Statements of Stockholders’ Equity — Three Months Ended March 31, 2022 and 2021	7
	Condensed Consolidated Statements of Cash Flows — Three Months Ended March 31, 2022 and 2021	8
	Notes to Condensed Consolidated Financial Statements	9
	Note 1. Basis of presentation and description of business	9
	Note 2. Summary of significant accounting policies	10
	Note 3. Financial instruments fair value	12
	Note 4. Acquisitions	15
	Note 5. Goodwill and other intangible assets	17
	Note 6. Leases	19
	Note 7. Commitments and contingencies	19
	Note 8. Debt	19
	Note 9. Share-based compensation	20
	Note 10. Net loss per share	22
	Note 11. Income taxes	23
	Note 12. Related party transactions	23
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	27
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	43
Item 4.	Controls and Procedures	44

PART II.	OTHER INFORMATION	46
Item 1.	Legal Proceedings	46
Item 1A.	Risk Factors	46
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	46
Item 3.	Defaults Upon Senior Securities	46
Item 4.	Mine Safety Disclosures	46
Item 5.	Other Information	46
Item 6.	Exhibits	47

Signatures		48

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GLOSSARY

We use acronyms, abbreviations, and other defined terms throughout this quarterly report on Form 10-Q. These terms are defined below. Jamf Holding Corp. and its wholly owned subsidiaries, collectively, are referred to as the “Company,” “we,” “us,” or “our.”


Term						Definition
2017 Option Plan						2017 Stock Option Plan
2020 Credit Agreement						Credit agreement dated July 27, 2020, as amended, supplemented, or modified
2020 Plan						Jamf Holding Corp. Omnibus Incentive Plan
2020 Revolving Credit Facility						Revolving credit facility available under the 2020 Credit Agreement
2021 ESPP						Jamf Holding Corp. 2021 Employee Stock Purchase Plan
2021 Term Loan Facility						364-day term loan facility incurred under the Credit Agreement Amendment
2026 Notes						Convertible Senior Notes due 2026
ARR						Annual Recurring Revenue
AWS						Amazon Web Services
ASC 606						ASC Topic 606, Revenue from Contracts with Customers
ASC 805						ASC Topic 805, Business Combinations
ASC 820						ASC Topic 820, Fair Value Measurement
ASC 850						ASC Topic 850, Related Party Disclosures
ASU						Accounting Standards Update
cmdSecurity						cmdSecurity Inc.
CODM						Chief operating decision maker
Credit Agreement Amendment						Incremental Facility Amendment No. 1 to the 2020 Credit Agreement, dated July 1, 2021
Current Period ARR						ARR from the same cohort of customers used to calculate Prior Period ARR as of the current period end
Digita						Digita Security LLC
FASB						Financial Accounting Standards Board
GAAP						U.S. generally accepted accounting principles
IPR&D						In-process research and development
JNGF						Jamf Nation Global Foundation
LTIP						Long-term incentive plan
Merger Agreement						Agreement and Plan of Merger, dated as of May 5, 2021 in connection with the acquisition of Wandera
Prior Period ARR						ARR from the cohort of all customers as of 12 months prior to period end
RSU						Restricted stock unit
SEC						Securities and Exchange Commission
UK						United Kingdom
Vista						Vista Equity Partners, LLC and its affiliates
Wandera						Wandera, Inc.
ZTNA						Zero Trust Network Access

Table of Contents

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

JAMF HOLDING CORP.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share amounts)


	March 31, 2022		December 31, 2021
	(Unaudited)
Assets
Current assets:
Cash and cash equivalents	$	164,595	$	177,150
Trade accounts receivable, net of allowances of $492 and $391 at March 31, 2022 and December 31, 2021, respectively	81,121		79,143
Income taxes receivable	287		608
Deferred contract costs	14,142		12,904
Prepaid expenses	19,616		17,581
Other current assets	4,318		4,212
Total current assets	284,079		291,598
Equipment and leasehold improvements, net	18,237		18,045
Goodwill	841,984		845,734
Other intangible assets, net	251,072		264,593
Deferred contract costs, non-current	31,793		29,842
Other assets	39,159		30,608
Total assets	$	1,466,324	$	1,480,420
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	8,808	$	9,306
Accrued liabilities	45,558		54,022
Income taxes payable	376		167
Deferred revenues	234,389		223,031
Total current liabilities	289,131		286,526
Deferred revenues, non-current	58,110		59,097
Deferred tax liability, net	8,097		8,700
Convertible senior notes, net	362,648		362,031
Other liabilities	26,417		25,640
Total liabilities	744,403		741,994
Commitments and contingencies (Note 7)
Stockholders’ equity:
Preferred stock, $0.001 par value, 50,000,000 shares authorized at March 31, 2022 and December 31, 2021; no shares issued and outstanding at March 31, 2022 and December 31, 2021	—		—
Common stock, $0.001 par value, 500,000,000 shares authorized at March 31, 2022 and December 31, 2021; 119,659,455 and 119,426,064 shares issued and outstanding at March 31, 2022 and December 31, 2021, respectively	119		119
Additional paid‑in capital	930,788		913,581
Accumulated other comprehensive loss	(15,949)		(7,866)
Accumulated deficit	(193,037)		(167,408)
Total stockholders’ equity	721,921		738,426
Total liabilities and stockholders’ equity	$	1,466,324	$	1,480,420

The accompanying notes are an integral part of these condensed consolidated financial statements.

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JAMF HOLDING CORP.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except share and per share amounts)

(unaudited)


	Three Months Ended March 31,
	2022		2021
Revenue:
Subscription	$	102,201	$	74,482
Services	3,944		4,003
License	2,113		2,242
Total revenue	108,258		80,727
Cost of revenue:
Cost of subscription (exclusive of amortization expense shown below)	19,902		12,014
Cost of services (exclusive of amortization expense shown below)	3,107		2,465
Amortization expense	5,218		2,777
Total cost of revenue	28,227		17,256
Gross profit	80,031		63,471
Operating expenses:
Sales and marketing	46,325		30,167
Research and development	24,802		15,626
General and administrative	25,612		16,244
Amortization expense	7,029		5,627
Total operating expenses	103,768		67,664
Loss from operations	(23,737)		(4,193)
Interest expense, net	(859)		(55)
Foreign currency transaction loss	(781)		(218)
Loss before income tax provision	(25,377)		(4,466)
Income tax provision	(252)		(123)
Net loss	$	(25,629)	$	(4,589)
Net loss per share, basic and diluted	$	(0.21)	$	(0.04)
Weighted‑average shares used to compute net loss per share, basic and diluted	119,594,341		117,386,322

The accompanying notes are an integral part of these condensed consolidated financial statements.

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JAMF HOLDING CORP.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(in thousands)

(unaudited)


	Three Months Ended March 31,
	2022		2021
Net loss	$	(25,629)	$	(4,589)
Other comprehensive loss:
Foreign currency translation adjustments	(8,083)		—
Total other comprehensive loss	(8,083)		—
Comprehensive loss	$	(33,712)	$	(4,589)

The accompanying notes are an integral part of these condensed consolidated financial statements.

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JAMF HOLDING CORP.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(in thousands, except share amounts)

(unaudited)


	Stock Class			Additional Paid‑In Capital		Accumulated Other Comprehensive Loss		Accumulated Deficit		Stockholders’ Equity
	Common
	Shares	Amount

Three Months Ended March 31, 2022:

Balance, December 31, 2021	119,426,064	$	119	$	913,581	$	(7,866)	$	(167,408)	$	738,426
Exercise of stock options	211,200	—		1,197		—		—		1,197
Vesting of restricted stock units	22,191	—		—		—		—		—
Share‑based compensation	—	—		16,010		—		—		16,010
Foreign currency translation adjustments	—	—		—		(8,083)		—		(8,083)
Net loss	—	—		—		—		(25,629)		(25,629)
Balance, March 31, 2022	119,659,455	$	119	$	930,788	$	(15,949)	$	(193,037)	$	721,921

Three Months Ended March 31, 2021:

Balance, December 31, 2020	116,992,472	$	117	$	903,116	$	—	$	(92,219)	$	811,014
Exercise of stock options	713,423	1		4,018		—		—		4,019
Share‑based compensation	—	—		2,832		—		—		2,832
Net loss	—	—		—		—		(4,589)		(4,589)
Balance, March 31, 2021	117,705,895	$	118	$	909,966	$	—	$	(96,808)	$	813,276

The accompanying notes are an integral part of these condensed consolidated financial statements.

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JAMF HOLDING CORP.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)


	Three Months Ended March 31,
	2022		2021
Cash flows from operating activities
Net loss	$	(25,629)	$	(4,589)
Adjustments to reconcile net loss to cash (used in) provided by operating activities:
Depreciation and amortization expense	13,893		9,784
Amortization of deferred contract costs	3,755		2,700
Amortization of debt issuance costs	679		69
Non-cash lease expense	1,291		1,267
Provision for credit losses and returns	128		159
Share‑based compensation	16,010		2,832
Deferred tax benefit	(468)		(613)
Adjustment to contingent consideration	88		300
Other	725		201
Changes in operating assets and liabilities:
Trade accounts receivable	(2,190)		(7,066)
Income tax receivable/payable	533		376
Prepaid expenses and other assets	(3,668)		(3,317)
Deferred contract costs	(6,952)		(5,065)
Accounts payable	(413)		(1,191)
Accrued liabilities	(11,250)		(7,683)
Deferred revenue	10,478		15,913
Other liabilities	—		(54)
Net cash (used in) provided by operating activities	(2,990)		4,023
Cash flows from investing activities
Acquisitions, net of cash acquired	(4,023)		(3,041)
Purchases of equipment and leasehold improvements	(1,964)		(3,290)
Proceeds from sale of equipment and leasehold improvements	8		12
Net cash used in investing activities	(5,979)		(6,319)
Cash flows from financing activities
Debt issuance costs	(50)		—
Cash paid for contingent consideration	(4,588)		—
Proceeds from the exercise of stock options	1,197		4,019
Net cash (used in) provided by financing activities	(3,441)		4,019
Effect of exchange rate changes on cash and cash equivalents	(145)		(401)
Net (decrease) increase in cash and cash equivalents	(12,555)		1,322
Cash and cash equivalents, beginning of period	177,150		194,868
Cash and cash equivalents, end of period	$	164,595	$	196,190


Supplemental disclosures of cash flow information:
Cash paid for:
Interest	$	293	$	3
Income taxes, net of refunds	192		351
Non-cash activities:
Operating lease assets obtained in exchange for operating lease liabilities	8,314		(19)

The accompanying notes are an integral part of these condensed consolidated financial statements.

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JAMF HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

Note 1. Basis of presentation and description of business

Description of business

We are the standard in Apple Enterprise Management, and our cloud software platform is the only vertically-focused Apple infrastructure and security platform of scale in the world. We help IT and security teams confidently protect the devices, data, and applications used by their workforce, while providing employees with consumer-simple, privacy-protecting technology. With Jamf’s software, devices can be deployed to employees brand new in the shrink-wrapped box, set up automatically and personalized at first power-on and administered continuously throughout the lifecycle of the device. Our customers are located throughout the world.

Basis of presentation and principles of consolidation

The accompanying condensed consolidated financial statements, which include the accounts of the Company and its wholly owned subsidiaries, have been prepared in accordance with GAAP and applicable rules and regulations of the SEC regarding interim financial reporting. All intercompany accounts and transactions have been eliminated.

The condensed consolidated financial statements and related notes in this Quarterly Report on Form 10-Q reflect the revisions previously made for immaterial errors related to certain commissions that were incorrectly capitalized in prior periods as well as various other immaterial errors. See Exhibit 99.2 titled, “Updates to the Company’s Quarterly Report on Form 10-Q for the Quarter Ended March 31, 2021”, of our Form 8-K, filed with the SEC on August 27, 2021, for more information.

Unaudited interim condensed consolidated financial information

The interim condensed consolidated balance sheet as of March 31, 2022, the condensed consolidated statements of operations, of comprehensive loss, of stockholders’ equity, and of cash flows for the three months ended March 31, 2022 and 2021 and the related notes are unaudited. The condensed consolidated balance sheet as of December 31, 2021 was derived from our audited consolidated financial statements that were included in our Annual Report on Form 10-K for the year ended December 31, 2021, which was filed with the SEC on March 1, 2022. The accompanying unaudited condensed consolidated financial statements and related notes should be read in conjunction with the consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021.

These unaudited interim condensed consolidated financial statements have been prepared on the same basis as the annual consolidated financial statements and, in management’s opinion, include all adjustments necessary for the fair presentation of the consolidated financial position, results of operations, and cash flows of the Company. All adjustments made were of a normal recurring nature. The results for the three months ended March 31, 2022 are not necessarily indicative of the results to be expected for the year ending December 31, 2022 or for any future period.

Use of estimates

The preparation of the condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities as of the reporting date, and the reported amounts of revenues and expenses during the reporting period. These estimates are based on management’s best knowledge of current events and actions that the Company may undertake in the future and include, but are not limited to, revenue recognition, stock-based compensation, commissions, the fair values of assets acquired and liabilities assumed in business combinations, useful lives for finite-lived assets, recoverability of long-lived assets, the value of right-of-use assets and lease liabilities, allowance for expected credit losses, commitments and contingencies, and accounting for income taxes and related valuation allowances against deferred tax assets. Actual results could differ from those estimates.

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JAMF HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

Segment and geographic information

Our CODM is our Chief Executive Officer, who reviews financial information presented on a consolidated basis for purposes of making operating decisions, assessing financial performance, and allocating resources. We operate our business as one operating segment and therefore we have one reportable segment.

Revenues by geographic region as determined based on the location where the sale originated were as follows:


	Three Months Ended March 31,
	2022		2021 (1)
	(in thousands)
The Americas (2)	$	75,149	$	58,845
Europe, the Middle East, India, and Africa	25,997		16,229
Asia Pacific	7,112		5,653
	$	108,258	$	80,727

(1) Previously reported revenues by geographic region for the three months ended March 31, 2021 have been revised to correct an immaterial error in the disclosure. There was no impact to total revenues.

(2) The vast majority of the Americas is the United States.

Note 2. Summary of significant accounting policies

The Company’s significant accounting policies are discussed in Note 2 to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. There have been no significant changes to these policies during the three months ended March 31, 2022. The following describes the impact of certain policies.

Trade accounts receivable, net

Credit is extended to customers in the normal course of business, generally with 30-day payment terms. Trade accounts receivable are recorded at the invoiced amount, net of allowances.

The allowance for credit losses is based on an expected loss model that estimates losses over the expected life of the trade accounts receivable. The Company estimates expected credit losses based on the Company’s historical loss information, current and future economic and market conditions, and ongoing review of customers’ account balances.

The Company writes-off a receivable against the allowance when a determination is made that the balance is uncollectible and collection of the receivable is no longer being actively pursued. This determination is based on the delinquency of the account, the financial condition of the customer, and the Company’s collection experience.

Activity related to our allowance for credit losses for trade accounts receivable was as follows:


	Three Months Ended March 31,
	2022		2021
	(in thousands)
Balance, beginning of period	$	391	$	530
Provision	122		156
Write-offs	(27)		(127)
Recoveries of amounts previously written off	6		44
Balance, end of period	$	492	$	603

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JAMF HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

Revenue recognition

The Company applies ASC 606 and follows a five-step model to determine the appropriate amount of revenue to be recognized in accordance with ASC 606.

Disaggregation of Revenue

The Company separates revenue into subscription and non-subscription categories to disaggregate those revenues that are term-based and renewable from those that are one-time in nature. Revenue from subscription and non-subscription contractual arrangements were as follows:


	Three Months Ended March 31,
	2022		2021
	(in thousands)
SaaS subscription and support and maintenance	$	96,350	$	66,776
On‑premise subscription	5,851		7,706
Subscription revenue	102,201		74,482
Professional services	3,944		4,003
Perpetual licenses	2,113		2,242
Non‑subscription revenue	6,057		6,245
Total revenue	$	108,258	$	80,727

Contract Balances

If revenue is recognized in advance of the right to invoice, a contract asset is recorded in other current assets on the condensed consolidated balance sheet. The opening and closing balances of contract assets were as follows:


	Three Months Ended March 31,
	2022		2021
	(in thousands)
Balance, beginning of the period	$	1,792	$	947
Balance, end of the period	1,885		1,186
Change	$	93	$	239

For the three months ended March 31, 2022 and 2021, the allowance for expected credit losses associated with contract assets was not material.

Contract liabilities consist of customer billings in advance of revenue being recognized. The Company invoices its customers for subscription, support and maintenance, and services in advance.

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JAMF HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

Changes in contract liabilities, including revenue earned during the period from the beginning contract liability balance and new deferrals of revenue during the period, were as follows:


	Three Months Ended March 31,
	2022		2021
	(in thousands)
Balance, beginning of the period	$	282,128	$	205,509
Revenue earned	(85,337)		(60,633)
Deferral of revenue	95,708		76,703
Balance, end of the period	$	292,499	$	221,579

There were no significant changes to our contract assets and liabilities during the three months ended March 31, 2022 and 2021 outside of our sales activities.

Remaining Performance Obligations

Revenue allocated to remaining performance obligations represents contracted revenue that has not yet been recognized, which includes deferred revenue and noncancellable amounts to be invoiced. As of March 31, 2022, the Company had $343.9 million of remaining performance obligations, with 72% expected to be recognized as revenue over the succeeding 12 months, and the remainder generally expected to be recognized over the three years thereafter.

Deferred Contract Costs

Sales commissions, as well as associated payroll taxes and retirement plan contributions (together, contract costs), that are incremental to the acquisition of customer contracts are capitalized using a portfolio approach as deferred contract costs in the condensed consolidated balance sheets when the period of benefit is determined to be greater than one year.

Total amortization of contract costs for the three months ended March 31, 2022 and 2021 was $3.8 million and $2.7 million, respectively.

The Company periodically reviews these deferred contract costs to determine whether events or changes in circumstances have occurred that could affect the period of benefit of these deferred contract costs. There were no impairment losses recorded during the three months ended March 31, 2022 and 2021.

Adoption of new accounting pronouncements

Business Combinations — Accounting for Contract Assets and Contract Liabilities from Contracts with Customers

In October 2021, the FASB issued ASU No. 2021-08, Business Combinations (Topic 805), Accounting for Contract Assets and Contract Liabilities from Contracts with Customers, which requires contract assets and contract liabilities acquired in a business combination to be recognized and measured by the acquirer on the acquisition date in accordance with ASC 606. Generally, this new guidance will result in the acquirer recognizing contract assets and contract liabilities at the same amounts recorded by the acquiree. Historically, such amounts were recognized by the acquirer at fair value in accordance with acquisition accounting. The new guidance should be applied prospectively to acquisitions occurring on or after the effective date. The standard is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Early adoption is permitted, including in interim periods, for any financial statements that have not been issued. The Company early adopted the new standard on January 1, 2022. The adoption of the standard did not have any impact on the Company’s condensed consolidated financial statements. We will apply the new guidance to future acquisitions.

Note 3. Financial instruments fair value

We report financial assets and liabilities and nonfinancial assets and liabilities that are recognized or disclosed at fair value in the condensed consolidated financial statements on a recurring basis in accordance with ASC 820. ASC 820 defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction

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JAMF HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

between market participants at the measurement date. When determining the fair value measurements for assets and liabilities, which are required to be recorded at fair value, we consider the principal or most advantageous market in which we would transact and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability, such as inherent risk, transfer restrictions, and credit risk.

ASC 820 also establishes a fair value hierarchy, which prioritizes the inputs to valuation techniques used to measure fair value into three levels. Fair value represents the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. GAAP established a hierarchy framework to classify the fair value based on the observability of significant inputs to the measurement. The levels of the fair value hierarchy are as follows:

Level 1: Fair value is determined using an unadjusted quoted price in an active market for identical assets or liabilities.

Level 2: Fair value is estimated using inputs other than quoted prices included within Level 1 that are observable, either directly or indirectly.

Level 3: Fair value is estimated using unobservable inputs that are significant to the fair value of the assets or liabilities.

Assets and liabilities measured at fair value on a recurring basis

The Company invests in money market funds with original maturities at the time of purchase of three months or less, which are measured and recorded at fair value on a recurring basis. Money market funds are valued based on quoted market prices in active markets and classified within Level 1 of the fair value hierarchy.

In addition, the contingent consideration associated with the Digita and cmdReporter acquisitions are measured and recorded at fair value on a recurring basis. The estimated fair value of the contingent payments associated with the Digita acquisition is determined using a Monte Carlo simulation model, which uses Level 3 inputs, including assumptions about the probability of growth of subscription services and the related pricing of the services offered. Significant increases (decreases) in the probability of growth of subscription services as well as the related pricing of the services offered would have resulted in a higher (lower) fair value measurement. The estimated fair value of the contingent payments associated with the cmdReporter acquisition was determined using projected contract wins, which used Level 3 inputs, including assumptions about the probability of closing contracts based on their current stage in the sales process. See Note 4 for more information.

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JAMF HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

The fair value of these financial instruments were as follows:


	March 31, 2022
	Level 1		Level 2		Level 3		Total
	(in thousands)
Cash equivalents:
Money market funds	$	126,048	$	—	$	—	$	126,048
Total cash equivalents	$	126,048	$	—	$	—	$	126,048

Contingent consideration:
Accrued liabilities	$	—	$	—	$	5,600	$	5,600
Total contingent consideration	$	—	$	—	$	5,600	$	5,600


	December 31, 2021
	Level 1		Level 2		Level 3		Total
	(in thousands)
Cash equivalents:
Money market funds	$	146,037	$	—	$	—	$	146,037
Total cash equivalents	$	146,037	$	—	$	—	$	146,037

Contingent consideration:
Accrued liabilities	$	—	$	—	$	4,588	$	4,588
Other liabilities	—		—		5,512		5,512
Total contingent consideration	$	—	$	—	$	10,100	$	10,100

The carrying value of accounts receivable and accounts payable approximate their fair value due to their short maturities and are excluded from the tables above.

The following table provides a summary of the changes in contingent consideration, which is classified as Level 3:


	Three Months Ended March 31,
	2022		2021
	(in thousands)
Balance, beginning of period	$	10,100	$	8,200
Additions	—		359
Total (gains) losses included in:
Net loss	88		300
Payments	(4,588)		—
Other	—		(60)
Balance, end of period	$	5,600	$	8,799

The change in the fair value of the contingent consideration is included in general and administrative expenses in the condensed consolidated statements of operations. The adjustment for the three months ended March 31, 2022 primarily reflected updated assumptions about the probability of growth of subscription services.

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JAMF HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

Fair value measurements of other financial instruments

The following table presents the net carrying value and estimated fair value of the 2026 Notes, which are not recorded at fair value in the condensed consolidated balance sheets:


	March 31, 2022				December 31, 2021
	Net Carrying Value		Estimated Fair Value		Net Carrying Value		Estimated Fair Value
	(in thousands)
2026 Notes	$	362,648	$	371,044	$	362,031	$	398,044

As of March 31, 2022 and December 31, 2021, the difference between the net carrying value of the 2026 Notes and the principal amount of $373.8 million represents the unamortized debt issuance costs of $11.1 million and $11.7 million, respectively. See Note 8 for more information. The estimated fair value of the 2026 Notes, which is classified as Level 2, was determined based on quoted bid prices of the 2026 Notes in an over-the-counter market on the last trading day of the reporting period.

Note 4. Acquisitions

During the first quarter of 2022, the Company completed two acquisitions to expand our products and services offerings. These acquisitions were not significant individually or in the aggregate to our condensed consolidated financial statements. The combined purchase price for these acquisitions was $4.0 million, which was paid with cash on hand. The purchase price was allocated to the assets acquired based on their estimated fair values as of the date of each acquisition. The allocation included $0.9 million to developed technology with an estimated useful life of 5.0 years and $0.1 million to other assets, with the remaining $3.0 million allocated to goodwill. The goodwill is not deductible for income tax purposes. Acquisition-related expenses were expensed as incurred and totaled $0.4 million for the three months ended March 31, 2022. These expenses were recognized as acquisition costs in general and administrative expenses in the condensed consolidated statement of operations.

Wandera

On July 1, 2021, the Company completed its acquisition of Wandera. Wandera is a leader in zero trust cloud security and access for mobile devices. As an Apple-first provider of unified cloud security, Wandera expands the Company’s security offering for the enterprise. Building on the Company’s existing capabilities, Wandera adds ZTNA, mobile threat defense, and data policy features to ensure mobile workers can simply and safely access the network resources they need while complying with organizational policies and reducing mobile charges. This acquisition uniquely positions the Company to help IT and security teams confidently protect the devices, data, and applications used by a mobile workforce, while extending the intended Apple experience through the Company’s robust and scalable Apple Enterprise Management platform.

Under the terms of the Merger Agreement, the Company acquired 100% of the voting equity interest in Wandera and paid total cash consideration of $409.3 million. The total consideration consisted of an initial payment of $359.3 million at close and deferred consideration of $50.0 million that was paid in $25.0 million increments on October 1, 2021 and December 15, 2021. The initial payment of $359.3 million included $0.7 million held back as partial security for post-closing true-up adjustments as well as indemnification claims made within one year of the acquisition date. The amount held back was released in the fourth quarter of 2021. The acquisition was initially financed with cash on hand and borrowings under the 2021 Term Loan Facility.

The Company accounted for the acquisition by applying the acquisition method of accounting for business combinations in accordance with ASC 805. Accordingly, the purchase price was allocated to the assets acquired and liabilities assumed based on their estimated fair values as of the date of acquisition. In accordance with GAAP, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Any residual purchase price is recorded as goodwill. The allocation of the purchase price required

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JAMF HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

management to make significant estimates in determining the fair value of assets acquired and liabilities assumed, especially with respect to intangible assets. These estimates included, but were not limited to:

•future expected cash flows from subscription contracts and acquired developed technologies;

•historical and expected customer attrition rates and anticipated growth in revenue;

•royalty rates applied to acquired developed technology platforms;

•obsolescence curves and other useful life assumptions, such as the period of time and intended use of acquired intangible assets in the Company’s product offerings;

•discount rates; and

•uncertain tax positions and tax-related valuation allowances.

The final purchase accounting allocations for the Wandera acquisition will be determined within one year from the acquisition date and depend on a number of factors, including finalization of income tax effects of the opening balance sheet. The actual fair values of Wandera’s tax assets and liabilities and resulting goodwill may differ from the adjustments set forth in this Form 10-Q. The following table summarizes the preliminary allocation of the purchase price to the estimated fair values of the assets acquired and liabilities assumed and reflects measurement period adjustments as of March 31, 2022 (in thousands):


Assets acquired:
Cash and cash equivalents	$	9,605
Trade accounts receivable, net	3,882
Prepaid expenses	900
Other current assets	426
Equipment and leasehold improvements, net	58
Intangible assets acquired	102,050
Operating lease assets	1,474
Deferred tax asset	918
Liabilities assumed:
Accounts payable	(788)
Accrued liabilities	(3,464)
Income taxes payable	(94)
Deferred revenue	(5,200)
Operating lease liabilities	(1,474)
Deferred tax liability	(9,374)
Goodwill	310,356
Total purchase consideration	$	409,275

During the fourth quarter of 2021, the Company recorded measurement period adjustments including an increase to other current assets of $0.4 million and an increase to deferred tax assets of $0.1 million, resulting in a decrease to goodwill of $0.5 million. The adjustments related to new information obtained about facts and circumstances that existed as of the acquisition date. The increase to other current assets relates to UK refundable research and development tax credits.

The goodwill represents the excess of the purchase consideration over the fair value of the underlying net identifiable assets. The goodwill recognized in this acquisition is primarily attributable to expected synergies in sales opportunities across complementary products, customers, and geographies and cross-selling opportunities. The goodwill is not deductible for income tax purposes.

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JAMF HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

The estimated useful lives and fair values of the identifiable intangible assets acquired were as follows:


	Useful Life	Gross Value
		(in thousands)
Developed technology	6.5 years	$	60,500
Customer relationships	11.0 years	35,600
Order backlog	2.5 years	3,800
Non-competes	2.5 years	1,750
Trademarks	3.0 years	400
Total identifiable intangible assets		$	102,050

The weighted-average useful life of the intangible assets acquired is 7.8 years.

Developed technology represents the estimated fair value of the features underlying the Wandera products as well as the platform supporting Wandera customers. Customer relationships represent the estimated fair value of the underlying relationships with Wandera customers. Order backlog represents the estimated fair value of existing order backlog with Wandera customers. Non-competes represent the estimated fair value of non-compete agreements acquired from Wandera. Trademarks represent the estimated fair value of the Wandera brand.

cmdReporter

On February 26, 2021, the Company entered into an asset purchase agreement with cmdSecurity to acquire certain cmdSecurity assets, including cmdReporter, a suite of security and compliance tools purpose-built for macOS. The final aggregate purchase price was approximately $3.4 million, which consisted of cash consideration of $3.0 million and contingent consideration of $0.4 million. The purchase price was allocated to the assets acquired based on their estimated fair values as of the date of the acquisition. The allocation included $2.6 million to developed technology with an estimated useful life of 5.0 years and $0.4 million to IPR&D, with the remaining $0.4 million allocated to goodwill. The IPR&D was completed in the first quarter of 2022 and is amortized over its estimated useful life of 5.0 years.

Digita

In 2019, the Company recorded contingent consideration in connection with its purchase of the outstanding membership interests of Digita. The maximum contingent consideration is $15.0 million if the acquired business achieves certain revenue milestones by December 31, 2022. The acquired business achieved the minimum revenue milestones, which resulted in the Company making cash payments of $4.6 million and $4.2 million in the first quarter of 2022 and the second quarter of 2021, respectively, to the former owners of the acquired business. If the acquired business continues to achieve the revenue milestones, an additional cash payment will be made within 30 days of December 31, 2022. See Note 3 for more information on the fair value of the contingent consideration.

Note 5. Goodwill and other intangible assets

The change in the carrying amount of goodwill was as follows:


	Three Months Ended March 31,
	2022		2021
	(in thousands)
Goodwill, beginning of period	$	845,734	$	541,480
Goodwill acquired	3,014		370
Foreign currency translation adjustment	(6,764)		—
Goodwill, end of period	$	841,984	$	541,850

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JAMF HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

The gross carrying amount and accumulated amortization of intangible assets other than goodwill were as follows:


	March 31, 2022
	Useful Life	Gross Value		Accumulated Amortization		Net Carrying Value		Weighted‑ Average Remaining Useful Life
	(in thousands)
Trademarks	3 - 8 years	$	34,680	$	18,891	$	15,789	3.6 years
Customer relationships	2 ‑ 12 years	248,959		80,934		168,025		8.0 years
Developed technology	5 - 6.5 years	115,677		52,186		63,491		5.0 years
Non‑competes	2 - 3 years	1,711		511		1,200		1.8 years
Order backlog	2.5 years	3,688		1,121		2,567		1.8 years
Total intangible assets		$	404,715	$	153,643	$	251,072


	December 31, 2021
	Useful Life	Gross Value		Accumulated Amortization		Net Carrying Value		Weighted‑ Average Remaining Useful Life
	(in thousands)
Trademarks	3 - 8 years	$	34,690	$	17,788	$	16,902	3.8 years
Customer relationships	2 ‑ 12 years	249,495		75,600		173,895		8.3 years
Developed technology	5 - 6.5 years	116,193		47,142		69,051		5.1 years
Non‑competes	2 - 2.5 years	1,797		439		1,358		2.0 years
Order backlog	2.5 years	3,745		758		2,987		2.0 years
Total intangible assets subject to amortization		405,920		141,727		264,193
IPR&D	Indefinite	400		—		400
Total intangible assets		$	406,320	$	141,727	$	264,593

The gross value in the tables above includes a cumulative foreign currency translation adjustment of $(4.3) million and $(2.1) million as of March 31, 2022 and December 31, 2021, respectively. The accumulated amortization in the table above includes a cumulative foreign currency translation adjustment of $(0.3) million as of March 31, 2022. The cumulative foreign currency translation adjustment for accumulated amortization was not material as of December 31, 2021.

Amortization expense was $12.2 million and $8.4 million for the three months ended March 31, 2022 and 2021, respectively.

There were no impairments to goodwill during the three months ended March 31, 2022 and 2021. There were no material impairments to intangible assets during the three months ended March 31, 2022 and 2021.

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JAMF HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

Note 6. Leases

Supplemental balance sheet information related to the Company’s operating leases is as follows:


Leases	Balance Sheet Classification	March 31, 2022		December 31, 2021
		(in thousands)
Assets
Operating lease assets	Other assets	$	28,603	$	21,600

Liabilities
Operating lease liabilities - current	Accrued liabilities	$	5,859	$	5,251
Operating lease liabilities - non-current	Other liabilities	26,380		20,086
Total operating lease liabilities		$	32,239	$	25,337

Maturities of the Company’s operating lease liabilities as of March 31, 2022 were as follows:


	Operating Leases
	(in thousands)
Years ending December 31:
2022 (remaining nine months)	$	4,963
2023	7,540
2024	6,495
2025	4,825
2026	4,831
Thereafter	7,169
Total lease payments	35,823
Less: imputed interest	3,584
Total present value of lease liabilities	$	32,239

Note 7. Commitments and contingencies

Contingencies

From time to time, the Company may be subject to various claims, charges, and litigation. The Company records a liability when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. The Company maintains insurance to cover certain actions and believes that resolution of such claims, charges, or litigation will not have a material impact on the Company’s financial position, results of operations, or liquidity. The Company had no liabilities for contingencies as of March 31, 2022 or December 31, 2021.

Note 8. Debt

Convertible Senior Notes

On September 17, 2021, the Company issued $373.8 million aggregate principal amount of 0.125% 2026 Notes in a private offering. As of March 31, 2022, the conditions allowing holders of the 2026 Notes to convert were not met.

The following table sets forth the interest expense related to the 2026 Notes for the three months ended March 31, 2022 (in thousands):


Contractual interest expense	$	117
Amortization of issuance costs	617

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JAMF HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

The effective interest rate on the 2026 Notes was 0.81% for the three months ended March 31, 2022. See Note 3 for additional information on the Company’s 2026 Notes.

Credit Agreement

The 2020 Credit Agreement provides for the 2020 Revolving Credit Facility of $150.0 million, which may be increased or decreased under specific circumstances, with a $25.0 million letter of credit sublimit and a $50.0 million alternative currency sublimit. In addition, the 2020 Credit Agreement provides for the ability of the Company to request incremental term loan facilities, in a minimum amount of $5.0 million for each facility. The maturity date of the 2020 Credit Agreement is July 27, 2025. The 2020 Credit Agreement contains customary representations and warranties, affirmative covenants, reporting obligations, negative covenants, and events of default. We were in compliance with such covenants as of both March 31, 2022 and December 31, 2021. As of both March 31, 2022 and December 31, 2021, we had $1.0 million of letters of credit outstanding under our 2020 Revolving Credit Facility.

As of March 31, 2022 and December 31, 2021, debt issuance costs related to the 2020 Credit Agreement of $0.8 million and $0.9 million, respectively, are included in other assets in the condensed consolidated balance sheets.

In connection with the closing of the Wandera acquisition on July 1, 2021, the Company entered into the Credit Agreement Amendment, which amended the Company’s existing 2020 Credit Agreement. The Credit Agreement Amendment provided for a new 364-day term loan facility in an aggregate principal amount of $250.0 million on substantially the same terms and conditions as the Company’s existing 2020 Revolving Credit Facility. The Company repaid the principal amount of the 2021 Term Loan Facility on September 23, 2021 with proceeds from the issuance and sale of the 2026 Notes.

Note 9. Share-based compensation

The Company’s equity incentive plans provide for granting various share-based awards to eligible employees, non-employee directors, and consultants of the Company. In addition, the Company offers an employee stock purchase plan to eligible employees.

The Company recognized stock-based compensation expense for all equity arrangements as follows:


	Three Months Ended March 31,
	2022		2021
	(in thousands)
Cost of revenue:
Subscription	$	1,955	$	324
Services	304		77
Sales and marketing	5,859		842
Research and development	3,859		778
General and administrative	4,033		811
	$	16,010	$	2,832

Equity Incentive Plans

The maximum number of shares of common stock available for issuance under the 2020 Plan was 24,256,740 shares as of January 1, 2022. As of March 31, 2022, 15,484,707 shares of common stock are reserved for additional grants under the 2020 Plan. As of March 31, 2022, 128,928 shares of common stock are reserved for additional grants under the 2017 Option Plan. All stock options previously granted by the Company were at an exercise price at or above the estimated fair market value of the Company’s common stock as of the grant date. No options were granted during the three months ended March 31, 2022.

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JAMF HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

Return Target Options

The table below summarizes return target option activity for the three months ended March 31, 2022:


	Options	Weighted‑ Average Exercise Price		Weighted‑ Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value (in thousands)
Outstanding, December 31, 2021	3,687,664	$	6.75	6.8	$	115,278
Granted	—	—			—
Exercised	—	—			—
Forfeitures	—	—			—
Outstanding, March 31, 2022	3,687,664	$	6.75	6.5	$	103,477
Options exercisable at March 31, 2022	—	$	—	—	$	—
Vested or expected to vest at March 31, 2022	—	$	—	—	$	—

The aggregate intrinsic value in the table above represents the total intrinsic value that would have been received by the optionholders had all optionholders exercised their options on the last day of the period. No return target options vested during the three months ended March 31, 2022. There was approximately $33.0 million of unrecognized compensation expense related to these return target options as of March 31, 2022.

Service-Based Options

The table below summarizes the service-based option activity for the three months ended March 31, 2022:


	Options	Weighted‑ Average Exercise Price		Weighted‑ Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value (in thousands)
Outstanding, December 31, 2021	1,643,266	$	5.68	6.1	$	53,129
Granted	—	—			—
Exercised	(211,200)	5.67			6,725
Forfeitures	—	—			—
Outstanding, March 31, 2022	1,432,066	$	5.68	5.8	$	41,716
Options exercisable at March 31, 2022	1,270,476	$