SSTK

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our interim unaudited consolidated financial statements and related notes contained elsewhere in this Quarterly Report on Form 10-Q and with information contained in our other filings, including the audited consolidated financial statements included in our 2025 Form 10-K. In addition to historical consolidated financial information, this discussion contains forward-looking statements including statements about our plans, estimates and beliefs. These statements involve risks and uncertainties and our actual results could differ materially from those expressed or implied in forward-looking statements. See “Forward Looking Statements” above and the “Risk Factors” disclosures contained in our 2025 Form 10-K for additional discussion of the risks and uncertainties that could cause our actual results to differ materially from those expressed or implied in our forward-looking statements. Merger Agreement with Getty Images On January 6, 2025, we entered into an Agreement and Plan of Merger (the “Merger Agreement”) to combine in a merger-of-equals transaction with Getty Images Holdings, Inc. (NYSE:GETY) (“Getty Images”) (such transaction referred to herein as the “Merger”). On June 30, 2026, Getty Images filed an 8-K announcing that its Board of Directors unanimously resolved to terminate the Merger Agreement. Overview and Recent Developments Shutterstock, Inc. (referred to herein as the “Company”, “we,” “our,” and “us”) is a leading global creative platform connecting brands and businesses to high quality content. Our platform brings together users and contributors of content by providing readily-searchable content that our customers pay to license and by compensating contributors as their content is licensed. Contributors upload their content to our web properties in exchange for royalty payments based on customer download activity. Beyond content, customers also leverage our platform to assist with the entire creative process from ideation through creative execution. Digital content licensed to our customers for their creative needs includes images, footage, music, and 3D models (our “Content” offering). Our Content revenues represent the majority of our business and are supported by our searchable creative platform and driven by our large contributor network. In addition, our customers have needs that are beyond traditional content license products and services. These include (i) licenses to metadata associated with our images, footage, music tracks and 3D models through our data offering, (ii) distribution and advertising services from our Giphy business, which consists of GIFs (graphics interchange format visuals) that serve as a critical ingredient in text- and message- based conversations and in contextual advertising settings, (iii) specialized solutions for high-quality content matched with production tools and services through Shutterstock Studios and (iv) other tailored white-glove services (collectively, our “Data, Distribution, and Services” offerings). Our Content Offering Our Content offering includes licenses for: •Images - consisting of photographs, vectors and illustrations. Images are typically used in visual communications, such as websites, digital and print marketing materials, corporate communications, books, publications and other similar uses. •Footage - consisting of video clips, premium footage filmed by industry experts and cinema grade video effects, available in HD and 4K formats. Footage is often integrated into websites, social media, marketing campaigns and cinematic productions. •Music - consisting of high-quality music tracks and sound effects, which are often used to complement images and footage. •3 Dimensional (“3D”) Models - consisting of 3D models available in a variety of formats, used in a variety of industries such as advertising, media and video production, gaming, retail, education, design and architecture. •Generative AI Content - consisting of images generated from algorithms trained with high-quality, ethically sourced content. Customers can generate images by entering a description of their desired content into model prompts. 23 Table of Contents Our Content is distributed to customers under the following brands: Shutterstock; Pond5; TurboSquid; PicMonkey; PremiumBeat; Splash News; Bigstock; and Envato. Shutterstock, our flagship brand, includes various content types such as image, footage, music and editorial. Pond5 is a video-first content marketplace which expands the Company’s content offerings across footage, image and music. TurboSquid operates a marketplace that offers more than one million 3D models and a 2 dimensional (“2D”) marketplace derived from 3D objects. PicMonkey is a leading online graphic design and image editing platform. PremiumBeat offers exclusive high-quality music tracks and provides producers, filmmakers and marketers the ability to search handpicked production music from the world’s leading composers. Splash News provides editorial image and video content across celebrity and red carpet events. Bigstock maintains a separate content library tailored for creators seeking to incorporate cost-effective imagery into their projects. Envato enhances digital creative assets and templates. Our Data, Distribution, and Services Offering: Our Data, Distribution, and Services offering addresses customer demand for products and services that are beyond our Content licenses. These products and services include, among other things, the use of our metadata, leveraging our Giphy, Inc. platform, and customized Shutterstock Studios offerings. We have seen increased demand for access to our metadata for machine learning and generative artificial intelligence model training. We offer ethically sourced and licenseable metadata at industry leading scales and quality. Our metadata customer base ranges from large technology and media companies to smaller start-up organizations. Our Data, Distribution, and Services offering also includes high-quality production and custom content at scale provided by Shutterstock Studios (“Studios”). Studios is a cost-effective solution for brands and agencies looking to meet their content needs and create fresh dynamic digital assets. Customers can bring an idea, and our Studios team will provide a 360-degree content creation solution. We offer a whole spectrum of services at pre-production, production, live production and post-production stages. 24 Table of Contents Key Operating Metrics In addition to key financial metrics, we regularly review a number of key operating metrics to evaluate our business, determine the allocation of resources and make decisions regarding business strategies. We believe that these metrics can be useful for understanding the underlying trends in our business. Subscribers, subscriber revenue and average revenue per customer from acquisitions are included in these metrics beginning twelve months after the closing of the respective business combination. Accordingly, the metrics include Subscribers, Subscriber revenue, and Average revenue per customer from Backgrid beginning February 2025. 2025 metrics include the counts and revenues from Envato for the three and six months ended June 30, 2025, which was acquired in July 22, 2024. Subscribers We define subscribers as those customers who purchase one or more of our monthly recurring products for a continuous period of at least three months, measured as of the end of the reporting period. We believe the number of subscribers is an important metric that provides insight into our monthly recurring business. We believe that an increase in our number of subscribers is an indicator of engagement in our platform and potential for future growth. Subscriber Revenue We define subscriber revenue as the revenue generated from subscribers during the period. We believe subscriber revenue, together with our number of subscribers, provide insight into the portion of our business driven by our monthly recurring products. Average Revenue Per Customer Average revenue per customer is calculated by dividing total revenue for the last twelve-month period by customers. We define customers as total active, paying customers that contributed to total revenue over the last twelve-month period. Changes in our average revenue per customer will be driven by changes in the mix of our subscription-based and transactional products as well as pricing in our transactional business. Paid Downloads We define paid downloads as the number of downloads that our customers make in a given period of our content. Paid downloads exclude content related to our Studios business, downloads of content that are offered to customers for no charge (including our free trials), and metadata delivered through our data deal offering. Measuring the number of paid downloads that our customers make in a given period is important because it is a measure of customer engagement on our platform and triggers the recognition of revenue and contributor royalties. The following tables summarize our key operating metrics, which are unaudited, for the three and six months ended June 30, 2026 and 2025: Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Subscribers (end of period)1 951,000 1,073,000 951,000 1,073,000 Subscriber revenue (in millions)1 $ 99.8 $ 108.0 $ 203.6 $ 217.9 Average revenue per customer (last twelve months)1 $ 292 $ 266 $ 292 $ 266 Paid downloads (in millions) 98.7 112.6 202.8 233.5 ________________________ 1 Subscribers, Subscriber Revenue and Average Revenue Per Customer from acquisitions are included in these metrics beginning twelve months after the closing of the respective business combination. Accordingly, the metrics include Subscribers, Subscriber revenue, and Average revenue per customer from Backgrid beginning February 2025. 2025 metrics include the counts and revenues from Envato, which was acquired in July 2024. 25 Table of Contents Critical Accounting Estimates Our financial statements are prepared in accordance with GAAP. The preparation of the consolidated financial statements in conformity with GAAP requires our management to make a number of estimates and assumptions relating to the reported amounts of assets and liabilities, the disclosure or inclusion of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenue and expenses during the period. We evaluate our significant estimates on an ongoing basis, including, but not limited to, estimates related to allowance for doubtful accounts, the volume of expected unused licenses used in revenue recognition for our subscription-based products, the fair value of acquired goodwill and intangible assets and income tax provisions. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about carrying value of assets and liabilities that are not readily apparent from other sources. Therefore, we consider these to be our critical accounting estimates. Actual results could differ from those estimates. A description of our critical accounting policies that involve significant management judgments appears in our 2025 Form 10-K, under “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Estimates.” See Note 3 to our Unaudited Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q for a full description of the impact of the adoption of any new accounting standards on our financial statements. There have been no material changes to our critical accounting estimates as compared to our critical accounting policies and estimates included in our 2025 Form 10-K. 26 Table of Contents Key Components of Our Results of Operations Revenue We distribute our product offerings through two primary channels: Content: The majority of our customers license image, video, music and 3D content for commercial purposes either directly through our self-service web properties or through our dedicated sales teams. Content customers have the flexibility to purchase subscription-based plans that are paid on a monthly or annual basis. Customers are also able to license content on a transactional basis. These customers generally license content under our standard or enhanced licenses, with additional licensing options available to meet customers’ individual needs. Certain content customers also have unique content, licensing and workflow needs. These customers communicate with dedicated sales professionals, service and research teams which provide a number of tailored enhancements to their creative workflows including non-standard licensing rights, multi-seat access, ability to pay on credit terms, multi-brand licensing packages, increased indemnification protection and content licensed for use-cases outside of those available on the e-commerce platform. Data, Distribution, and Services: Our Data, Distribution, and Services offering addresses customer demand for products and services that are beyond our stock image, footage music and 3D model licenses. We have seen increased demand for access to our metadata for machine learning and generative artificial intelligence model training. We offer ethically sourced and licenseable metadata at unique scales and quality. Our metadata customer base ranges from large technology and media companies to smaller start-up organizations. Our Data, Distribution, and Services offering also includes high-quality production and custom content at scale provided by Shutterstock Studios (“Studios”). Studios is a cost-effective solution for brands and agencies looking to meet their content needs and create fresh dynamic digital assets. Customers can bring an idea, and our Studios team will provide a 360-degree content creation solution. We offer a whole spectrum of services at pre-production, production and post-production stages. The Company’s revenues by distribution channel for the three and six months ended June 30, 2026 and 2025 are as follows (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Content $ 165,664 $ 199,796 $ 343,790 $ 402,684 Data, Distribution, and Services 56,137 67,194 77,181 106,926 Total Revenues $ 221,801 $ 266,990 $ 420,971 $ 509,610 Costs and Expenses Cost of Revenue. Cost of revenue consists of royalties paid to contributors, credit card processing fees, content review costs, customer service expenses, infrastructure and hosting costs related to maintaining our creative platform and cloud-based software platform, depreciation and amortization of capitalized internal-use software, purchased content and acquisition-related intangible assets, allocated facility costs and other supporting overhead costs. Cost of revenue also includes employee compensation, including non-cash equity-based compensation, bonuses and benefits associated with the maintenance of our creative platform and cloud-based software platform. Sales and Marketing. Sales and marketing expenses include third-party marketing, advertising, branding, public relations and sales expenses. Sales and marketing expenses also include associated employee compensation, including non-cash equity-based compensation, bonuses and benefits, and commissions as well as allocated facility and other supporting overhead costs. Product Development. Product development expenses consist of employee compensation, including non-cash equity-based compensation, bonuses and benefits, and expenses related to vendors engaged in product management, design, development and testing of our websites and products. Product development costs also include software and other IT equipment costs, allocated facility expenses and other supporting overhead costs. General and Administrative. General and administrative expenses include employee compensation, including non-cash equity-based compensation, bonuses and benefits for executive, finance, accounting, legal, human resources, internal information technology, internet security, business intelligence and other administrative personnel. In addition, general and 27 Table of Contents administrative expenses include outside legal, tax and accounting services, bad debt expense, insurance, facilities costs, other supporting overhead costs and depreciation and amortization expense. Interest Expense. Interest expense consists of interest on our debt and amortization of deferred financing fees. Other (Expense) / Income, Net. Other (expense) / income, net consists of non-operating costs such as foreign currency transaction gains and losses, in addition to unrealized gains and losses on investments and interest income and expense. Income Taxes. We compute income taxes using the asset and liability method, under which deferred tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities using enacted statutory income tax rates in effect for the year in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce net deferred tax assets to the amount expected to be realized. 28 Table of Contents Results of Operations The following table presents our results of operations for the periods indicated. The period-to-period comparisons of results are not necessarily indicative of results for future periods. Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 (in thousands) Consolidated Statements of Operations: Revenue $ 221,801 $ 266,990 $ 420,971 $ 509,610 Operating expenses: Cost of revenue 93,787 105,994 188,575 206,882 Sales and marketing 48,008 57,077 96,354 110,436 Product development 17,574 20,754 36,979 40,619 General and administrative 43,930 48,434 111,515 106,741 Goodwill impairment 173,738 — 173,738 — Total operating expenses 377,037 232,259 607,161 464,678 (Loss) / income from operations (155,236) 34,731 (186,190) 44,932 Interest expense (3,833) (4,224) (7,593) (8,522) Other (expense) / income, net (1,862) 12,624 (16,523) 27,139 (Loss) / income before income taxes (160,931) 43,131 (210,306) 63,549 (Benefit) / provision for income taxes (4,992) 13,691 (6,798) 15,421 Net (loss) / income $ (155,939) $ 29,440 $ (203,508) $ 48,128 The following table presents the components of our results of operations for the periods indicated as a percentage of revenue: Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Consolidated Statements of Operations: Revenue 100 % 100 % 100 % 100 % Operating expenses: Cost of revenue 42 % 40 % 45 % 41 % Sales and marketing 22 % 21 % 23 % 22 % Product development 8 % 8 % 9 % 8 % General and administrative 21 % 18 % 26 % 21 % Goodwill impairment 78 % — % 41 % — % Total operating expenses 170 % 87 % 144 % 91 % (Loss) / income from operations (70) % 13 % (44) % 9 % Interest expense (2) % (2) % (2) % (2) % Other (expense) / income, net (1) % 5 % (4) % 5 % (Loss) / Income before income taxes (73) % 16 % (50) % 12 % (Benefit) / (provision) for income taxes (2) % 5 % (2) % 3 % Net (loss) / income (70) % 11 % (48) % 9 % __________________________________ Note: Due to rounding, percentages may not sum to totals. 29 Table of Contents Comparison of the Three Months Ended June 30, 2026 and 2025 The following table presents our results of operations for the periods indicated (in thousands): Three Months Ended June 30, 2026 2025 $ Change % Change Consolidated Statements of Operations: Revenue $ 221,801 $ 266,990 $ (45,189) (17) % Operating expenses: Cost of revenue 93,787 105,994 (12,207) (12) Sales and marketing 48,008 57,077 (9,069) (16) Product development 17,574 20,754 (3,180) (15) General and administrative 43,930 48,434 (4,504) (9) Goodwill impairment 173,738 — 173,738 — Total operating expenses 377,037 232,259 144,778 62 (Loss) / income from operations (155,236) 34,731 (189,967) (547) Interest expense (3,833) (4,224) 391 (9) Other (expense) / income, net (1,862) 12,624 (14,486) (115) (Loss) / Income before income taxes (160,931) 43,131 (204,062) (473) (Benefit) / provision for income taxes (4,992) 13,691 (18,683) (136) Net (loss) / income $ (155,939) $ 29,440 $ (185,379) (630) % __________________________________ Note: Due to rounding, percentages may not sum to totals. Revenue Revenue decreased by $45.2 million, or 17%, to $221.8 million for the three months ended June 30, 2026, compared to the same period in 2025. On a constant currency basis, revenue decreased by 17% in the three months ended June 30, 2026, compared to the same period in 2025. Our Content revenues decreased by 17%, to $165.7 million in the three months ended June 30, 2026, compared to the same period in 2025. On a constant currency basis, content revenue decreased by 16% in the three months ended June 30, 2026, compared to the same period in 2025. During the three months ended June 30, 2026, the reduction in our Content revenue was driven primarily by weakness in new customer acquisition. Our Data, Distribution, and Services revenues decreased by 16%, to $56.1 million in the three months ended June 30, 2026, compared to the same period in 2025. On a constant currency basis, Data, Distribution, and Services revenues decreased by 19% in the three months ended June 30, 2026, compared to the same period in 2025. The decrease in Data, Distribution, and Services revenues was primarily driven by a decline in our data offering, which decreased by 11% in the three months ended June 30, 2026 compared to the same period in 2025. Revenue recognition in our data offering may vary from quarter-to-quarter based on the delivery timing of metadata licenses. Changes in our revenue by region were as follows: revenue from North America decreased by $29.8 million, or 20%, to $118.1 million, revenue from Europe decreased by $5.2 million, or 8%, to $59.2 million and revenue from outside Europe and North America decreased by $10.2 million, or 19%, to $44.5 million, in the three months ended June 30, 2026 compared to the same period in 2025. Costs and Expenses Cost of Revenue. Cost of revenue decreased by $12.2 million to $93.8 million in the three months ended June 30, 2026 compared to the same period in 2025. This decrease is primarily due to lower royalty expenses as a result of the decline in revenue for the quarter. As a percentage of revenue, cost of revenue increased to 42% for the three months ended June 30, 2026, from 40% for the same period in 2025, and this increase related to AI token usage fees and website hosting costs which do not fluctuate with revenue. We expect that our cost of revenue will continue to fluctuate in-line with changes in revenue. Sales and Marketing. Sales and marketing expenses decreased by $9.1 million, or 16%, to $48.0 million in the three months ended June 30, 2026 compared to the same period in 2025. This was driven by a decrease in brand and performance-based marketing expenses. As a percentage of revenue, sales and marketing expenses increased to 22% for the three months ended 30 Table of Contents June 30, 2026, from 21% for the same period in 2025. We expect sales and marketing expenses to continue to fluctuate as we optimize our sales channels and invest in new customer acquisition, products and geographies. Product Development. Product development expenses decreased by $3.2 million to $17.6 million in the three months ended June 30, 2026 compared to the same period in 2025. The decrease in product development was driven by a decrease in employee-related costs and decreases in software licenses and third-party contractor related costs, net of capitalized labor. We expect product development expenses, of which a portion will be capitalized, to continue in the foreseeable future, as we pursue opportunities to invest in developing new products and internal tools and enhance the functionality of our existing products and technologies. General and Administrative. General and administrative expenses decreased by $4.5 million, to $43.9 million, in the three months ended June 30, 2026 compared to the same period in 2025. The decrease was driven by decreases in employee-related costs, offset by $3.7 million of expenses associated with the Merger. Goodwill Impairment. As of June 30, 2026, management determined that Getty Image's June 30, 2026 announcement to terminate the Merger Agreement resulted in a triggering event and required the performance of a quantitative goodwill impairment test. The analysis resulted in a goodwill impairment charge of $173.7 million. Interest Expense. In the three months ended June 30, 2026 and June 30, 2025, we recognized interest expense of $3.8 million and $4.2 million, respectively, related to our credit facility and the amortization of deferred financing fees. Interest expense for the three months ended June 30, 2026 decreased due to lower interest rates in the three months ended June 30, 2026 as compared to the same period in 2025. Other (Expense) / Income, Net. In the three months ended June 30, 2026, other (expense) / income, net was driven by $3.0 million of unrealized losses related to our investment in Meitu, Inc. In addition, other income, net had $0.5 million of interest income and $0.6 million of unrealized foreign currency losses. In the three months ended June 30, 2025, other income, net was primarily driven by $18.0 million of unrealized gains related to our investment in Meitu, Inc. In addition, other income, net had $1.1 million of interest income and $1.5 million of unrealized foreign currency gains. As we increase the volume of business transacted in foreign currencies resulting from international expansion and as currency rates fluctuate, we expect foreign currency gains and losses to continue to fluctuate. Income Taxes. The income tax expense decreased by $18.7 million for the three months ended June 30, 2026, compared to the same period in 2025. Our effective tax rates were a net benefit of 3.1% and an expense of 31.7% for the three months ended June 30, 2026 and 2025, respectively. For the three months ended June 30, 2026, the net effect of discrete items decreased the effective tax rate by 45.3%. The discrete items for the three months ended June 30, 2026 primarily relate to the book goodwill impairment which is non-deductible for tax purposes, partially offset by shortfalls on equity award vestings. Excluding discrete items, our effective tax rate would have been 48.4% for the three months ended June 30, 2026. For the three months ended June 30, 2025, the net effect of discrete items increased the effective tax rate by 2.3%. The discrete items for the three months ended June 30, 2025 primarily relate to shortfalls on equity award vestings, partially offset by a decrease in valuation allowance. Excluding discrete items, our effective tax rate would have been 29.4% for the three months ended June 30, 2025. As we continue to expand our operations outside of the United States, we have been and may continue to become subject to taxation in additional non-U.S. jurisdictions and our effective tax rate could fluctuate accordingly. 31 Table of Contents Comparison of the Six Months Ended June 30, 2026 and 2025 The following table presents our results of operations for the periods indicated: Six Months Ended June 30, 2026 2025 $ Change % Change (in thousands) Consolidated Statements of Operations Data: Revenue $ 420,971 $ 509,610 $ (88,639) (17) % Operating expenses: Cost of revenue 188,575 206,882 (18,307) (9) Sales and marketing 96,354 110,436 (14,082) (13) Product development 36,979 40,619 (3,640) (9) General and administrative 111,515 106,741 4,774 4 Goodwill impairment 173,738 — 173,738 — Total operating expenses 607,161 464,678 142,483 31 Income from operations (186,190) 44,932 (231,122) (514) Interest expense (7,593) (8,522) 929 (11) Other income, net (16,523) 27,139 (43,662) (161) Income before income taxes (210,306) 63,549 (273,855) (431) (Benefit) / provision for income taxes (6,798) 15,421 (22,219) (144) Net income $ (203,508) $ 48,128 $ (251,636) (523) % Revenue Revenue decreased by $88.6 million, or 17%, to $421.0 million in the six months ended June 30, 2026, compared to the same period in 2025. On a constant currency basis, revenue decreased by 18% in the six months ended June 30, 2026, compared to the same period in 2025. Our Content revenues decreased by 15%, to $343.8 million in the six months ended June 30, 2026, compared to the same period in 2025. On a constant currency basis, content revenue decreased by 15% in the six months ended June 30, 2026, compared to the same period in 2025. During the six months ended June 30, 2026, the reduction in our Content revenue was driven primarily by weakness in new customer acquisition. Our Data, Distribution, and Services revenues decreased by 28%, to $77.2 million in the six months ended June 30, 2026, compared to the same period in 2025. Foreign currency fluctuations did not have a significant impact on our Data, Distribution, and Services revenues in the six months ended June 30, 2026. The decrease in Data, Distribution, and Services revenues was primarily driven by a decline in our data offering, which decreased by 26% in the six months ended June 30, 2026 compared to the same period in 2025. Revenue recognition in our data offering may vary from quarter-to-quarter based on the delivery timing of metadata licenses. Changes in our revenue by region were as follows: revenue from North America decreased by $60.9 million, or 23%, to $207.2 million, revenue from Europe decreased by $8.7 million, or 7%, to $121.9 million and revenue from outside Europe and North America decreased by $19.0 million, or 17%, to $91.9 million, in the six months ended June 30, 2026, compared to the same period in 2025. Costs and Expenses Cost of Revenue. Cost of revenue decreased by $18.3 million, or 9%, to $188.6 million in the six months ended June 30, 2026 compared to the same period in 2025. This decrease was driven by decreased royalty and content costs, costs associated with website hosting, hardware and software licenses, and employee related costs, Giphy Retention Compensation expenses, and depreciation and amortization driven by the acquisition of Envato. As a percent of revenue, cost of revenue increased to 45% for the six months ended June 30, 2026, from 41% for the same period in 2025. We expect that our cost of revenue will continue to fluctuate in line with changes in revenue. Sales and Marketing. Sales and marketing expenses decreased by $14.1 million, or 13%, to $96.4 million in the six months ended June 30, 2026 compared to the same period in 2025. This decrease was driven by a decrease in brand and performance-based marketing expenses. As a percentage of revenue, sales and marketing expenses increased to 23% for the six 32 Table of Contents months ended June 30, 2026, from 22% for the same period in 2025. We expect sales and marketing expenses to continue to fluctuate as we optimize our sales channels and invest in new customer acquisition, products and geographies. Product Development. Product development expenses decreased by $3.6 million, or 9%, to $37.0 million in the six months ended June 30, 2026 as compared to the same period in 2025. The decrease in product development was driven by a decrease in employee-related costs and decreases in software licenses and third-party contractor related costs, net of capitalized labor. We expect product development expenses, of which a portion will be capitalized, to continue in the foreseeable future, as we pursue opportunities to invest in developing new products and internal tools and enhance the functionality of our existing products and technologies. General and Administrative. General and administrative expenses increased by $4.8 million, or 4%, to $111.5 million in the six months ended June 30, 2026 compared to the same period in 2025. The increase was driven by $6.5 million of expenses associated with the Merger, increases in legal contingencies of $33.0 million (see “Note 15 — Commitments and Contingencies — Legal Matters” for more information), offset by decreases in employee-related costs. Goodwill Impairment. As of June 30, 2026, management determined that Getty Image's June 30, 2026 announcement to terminate the Merger Agreement resulted in a triggering event and required the performance of a quantitative goodwill impairment test. The analysis resulting in a goodwill impairment charge of $173.7 million. Interest Expense. In the six months ended June 30, 2026 and June 30, 2025, we recognized interest expense of $7.6 million and $8.5 million, respectively related to our credit facility and the amortization of deferred financing fees. Interest expense for the six months ended June 30, 2026 decreased due to lower interest rates in the six months ended June 30, 2026 as compared to the same period in 2025. Other (Expense) / Income, Net. In the six months ended June 30, 2026, other (expense) / income decreased by $43.7 million, or 161%, to ($16.5 million). In the six months ended June 30, 2026, other (expense) / income, net was driven by $18.3 million of unrealized losses related to our investment in Meitu, Inc. In addition, other income, net had $1.3 million of interest income and $0.5 million of unrealized foreign currency losses. In the six months ended June 30, 2025, other income, net was primarily driven by $31.3 million of unrealized gains related to our investment in Meitu, Inc. In addition, other income, net had $2.0 million of interest income and $1.2 million of unrealized foreign currency gains. As we increase the volume of business transacted in foreign currencies resulting from international expansion and as currency rates fluctuate, we expect foreign currency gains and losses to continue to fluctuate. Income Taxes. Income tax expense decreased by $22.2 million for the six months ended June 30, 2026, compared to the same period in 2025. Our effective tax rates were a benefit of 3.2% and an expense of 24.3% for the six months ended June 30, 2026 and 2025, respectively. For the six months ended June 30, 2026, the net effect of discrete items decreased the effective tax rate by 42.5%. The discrete items for the six months ended June 30, 2026, primarily relate to the book goodwill impairment, which is non-deductible for tax purposes, partially offset by shortfalls on equity award vestings. Excluding discrete items, our effective tax rate would have been 45.7% for the six months ended June 30, 2026. For the six months ended June 30, 2025, the net effect of discrete items decreased the effective tax rate by 4.7%. The discrete items for the six months ended June 30, 2025 relate to shortfalls on equity award vestings. Excluding discrete items, our effective tax rate would have been 29.0% for the six months ended June 30, 2025. As we continue to expand our operations outside of the United States, we have been and may continue to become subject to taxation in additional non-U.S. jurisdictions, and our effective tax rate could fluctuate accordingly. Quarterly Trends Our operating results have in the past fluctuated from quarter to quarter as a result of a variety of factors, including the effects of some seasonal trends in customer behavior, timing of acquisitions and the timing of revenue recognition associated with data deal partnerships. In addition, expenditures on content by customers tend to be discretionary in nature, reflecting overall economic conditions, the economic prospects of specific industries, budgeting constraints, buying patterns and a variety of other factors, many of which are outside our control. As a result of these and other factors, the results of any prior quarterly or annual periods should not be relied upon as indicators of our future operating performance. 33 Table of Contents Liquidity and Capital Resources As of June 30, 2026, we had cash and cash equivalents totaling $133.2 million which consisted primarily of bank deposits. Since inception, we have financed our operations primarily through cash flows generated from operations. In addition, if necessary, we have the ability to draw on our A&R Credit Agreement. Historically, our principal uses of cash have included funding our operations, capital expenditures, and content acquisitions. In addition, our capital allocation strategies also include funding business combinations and asset acquisitions that enhance our strategic position, cash dividend payments, principle and interest payments under our credit facilities and share purchases under our share repurchase programs. We plan to finance our operations, capital expenditures and corporate actions largely through cash generated by our operations and our credit facility. Since our results of operations are sensitive to the level of competition we face, increased competition could adversely affect our liquidity and capital resources. Dividends We declared and paid cash dividends of $0.72 per share of common stock, or $26.0 million during the six months ended June 30, 2026. Future declarations of dividends are subject to the final determination of our Board of Directors, and will depend on, among other things, our future financial condition, results of operations, capital requirements, capital expenditure requirements, contractual restrictions, anticipated cash needs, business prospects, provisions of applicable law and other factors our Board of Directors may deem relevant. Share Repurchase Program In June 2023, our Board of Directors approved a share repurchase program (the “Share Repurchase Program”), providing authorization to repurchase up to $100 million of our common stock. We expect to fund future repurchases, if any, through a combination of cash on hand, cash generated by operations and future financing transactions, if appropriate. Accordingly, our Share Repurchase Program is subject to us having available cash to fund repurchases. Under the share repurchase program, management is authorized to purchase shares of our common stock from time to time through open market purchases or privately negotiated transactions at prevailing prices as permitted by securities laws and other legal requirements, and subject to market conditions and other factors. As of June 30, 2026, we have repurchased approximately 5.5 million shares of our common stock in total since 2015 under the Share repurchase programs (including the 2015 and 2017 Share Repurchase Programs and the 2023 Share Repurchase Program) at an average per-share cost of $48.86. During the three and six months ended June 30, 2026 and 2025, we did not repurchase shares of our common stock. As of June 30, 2026, we had $30.2 million of remaining authorization for repurchases under the Share Repurchase Program. Credit Facility and A&R Credit Agreement On May 6, 2022, we entered into a five-year $100 million unsecured revolving loan facility (the “Credit Facility”) with Bank of America, N.A., as Administrative Agent, and other lenders. The Credit Facility includes a letter of credit sub-facility and a swingline facility and also permits, subject to the satisfaction of certain conditions, up to $100 million of additional revolving loan commitments with the consent of the Administrative Agent. On July 22, 2024, we entered into an amended and restated credit agreement (the “A&R Credit Agreement”), which was entered into among us, as borrower, certain of our direct and indirect subsidiaries as guarantors, the lenders party thereto, and Bank of America, N.A., as Administrative Agent for the lenders. The A&R Credit Agreement provides for a five-year (i) senior unsecured term loan facility (the “Term Loan”) in an aggregate principal amount of $125 million and (ii) senior unsecured revolving credit facility (the “Revolver”) in an aggregate principal amount of $250 million. The A&R Credit Agreement provides for a letter of credit subfacility and a swingline facility. At our option, loans under the A&R Credit Agreement accrue interest at a per annum rate based on either (i) the base rate plus a margin ranging from 0.375% to 0.750%, determined based on our consolidated leverage ratio or (ii) the Term Secured Overnight Financing Rate (“SOFR”) (for interest periods of 1, 3 or 6 months) plus a margin ranging from 1.375% to 1.750%, determined based on our consolidated leverage ratio, plus a credit spread of 0.100%. We are also required to pay an unused commitment fee ranging from 0.175% to 0.250%, determined based on our consolidated leverage ratio. In connection with the execution of this agreement, we paid debt issuance costs of approximately $2.2 million. As of June 30, 2026, we had a remaining borrowing capacity of $94 million, net of standby letters of credit. The A&R Credit Agreement contains financial covenants and requirements restricting certain of our activities, which are customary for this type of credit facility. We are also required to maintain compliance with a consolidated leverage ratio and a 34 Table of Contents consolidated interest coverage ratio, in each case, determined in accordance with the terms of the A&R Credit Agreement. As of June 30, 2026, we were in compliance with these covenants. Our outstanding debt (in thousands) is reflected in the table below. We classify the Revolver as a current liability since we could draw upon and repay the outstanding amount as needed. The maturity of the Revolver is in 2029. Our debt consists of the following (in thousands): As of June 30, 2026 As of December 31, 2025 Current Debt: Revolver - A&R Credit Agreement 155,000 155,000 Term Loan - A&R Credit Agreement 3,112 3,110 Non-Current Debt: Term Loan - A&R Credit Agreement 115,157 116,639 Based on Level 2 inputs, the carrying value of our debt approximates its fair value, as borrowings are subject to variable interest rates that adjust with changes in market rates and market conditions and the current interest rate approximates that which would be available under similar financial arrangements. For the three and six months ended June 30, 2026, we recognized interest expense of $3.8 million and $7.6 million, respectively. As of June 30, 2026, unamortized debt issuance cost related to the Term Loan - A&R Credit Agreement is $0.5 million. Sources and Uses of Funds We believe, based on our current operating plan, that our cash and cash equivalents, and cash from operations, will be sufficient to meet our anticipated cash needs for at least the next 12 months. Our longer-term liquidity is contingent upon future operating performance. Future capital expenditures will generally relate to building enhancements to the functionality of our current platform, the acquisition of additional storage, servers, network connectivity hardware, security apparatus and software, leasehold improvements and furniture and fixtures related to office expansion and relocation, content and general corporate infrastructure. As of June 30, 2026, we had approximately $99 million in unconditional cash obligations, consisting primarily of purchase obligations related to contracts for cloud-based services, infrastructure and other business services as well as minimum royalty guarantees in connection with certain content licenses, of which the majority is due to be paid within the next two years. In addition, as of June 30, 2026, we had approximately $24 million in operating lease obligations with lease payments extending through 2029. See Note 15 to our Unaudited Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q for information regarding our existing capital commitments as of June 30, 2026. Cash Flows The following table summarizes our cash flow data for the six months ended June 30, 2026 and 2025 (in thousands): Six Months Ended June 30, 2026 2025 Net cash provided by operating activities $ 17,991 $ 52,083 Net cash used in investing activities $ (21,285) $ (26,199) Net cash used in financing activities $ (38,407) $ (29,699) Operating Activities Our primary source of cash from operating activities is cash collections from our customers. The majority of our revenue is generated from credit card transactions and is typically settled within one to five business days. Our primary uses of cash for operating activities are for the payment of royalties to content contributors, employee-related expenditures and the payment of other operating expenses incurred in the ordinary course of business. Net cash provided by operating activities was $18.0 million for the six months ended June 30, 2026, compared to $52.1 million for the six months ended June 30, 2025. The decline in cash flows for the six months ended June 30, 2026, compared to the prior year, is primarily attributed to the year-over-year decline in revenue. 35 Table of Contents Investing Activities Cash used in investing activities for the six months ended June 30, 2026 was $21.3 million, consisting primarily of (i) capital expenditures of $21.7 million for internal-use software and website development costs and purchases of software and equipment; and (ii) $0.3 million paid to acquire the rights to distribute certain digital content into perpetuity. These cash outflows were partially offset by $0.5 million of Giphy Retention Compensation, as reimbursed by the Giphy seller. Cash used in investing activities in the six months ended June 30, 2025 was $26.2 million, consisting primarily of (i) capital expenditures of $22.1 million for internal-use software and website development costs and purchases of software and equipment; and (ii) $5.0 million paid to acquire the rights to distribute certain digital content in perpetuity. These cash outflows were partially offset by $0.9 million of Giphy Retention Compensation, as reimbursed by the Giphy seller. Financing Activities Cash used in financing activities for the six months ended June 30, 2026 was $38.4 million, consisting of (i) $26.0 million related to the payment of quarterly cash dividends; (ii) $10.8 million paid in the settlement of tax withholding obligations related to employee stock-based compensation awards; and (ii) $1.6 million used for the repayment of our A&R Credit Agreement. Cash used in financing activities in the six months ended June 30, 2025 was $29.7 million, consisting of (i) $23.1 million related to the payment of quarterly cash dividends; (ii) $5.0 million paid in the settlement of tax withholding obligations related to employee stock-based compensation awards; and (iii) $1.6 million used for the repayment of our A&R Credit Agreement. Non-GAAP Financial Measures To supplement our consolidated financial statements presented in accordance with the accounting principles generally accepted in the United States, or GAAP, our management considers certain financial measures that are not prepared in accordance with GAAP, collectively referred to as non-GAAP financial measures, including adjusted net income, adjusted net income per diluted common share, adjusted EBITDA, adjusted EBITDA margin, revenue growth / (decline) (including by product offering) on a constant currency basis (expressed as a percentage), and adjusted free cash flow. These non-GAAP financial measures are included solely to provide investors with additional information regarding our financial results and are not based on any standardized methodology prescribed by GAAP and are not necessarily comparable to similarly-titled measures presented by other companies. Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Non-GAAP Financial Measures (in thousands): Adjusted net income $ 30,020 $ 42,872 $ 50,750 $ 79,164 Adjusted EBITDA $ 65,097 $ 82,236 $ 107,803 $ 145,600 Adjusted free cash flow $ 28,475 $ 17,498 $ 41,607 $ 40,882 Revenue (decline) / growth on a constant currency basis (17) % 20 % (18) % 17 % These non-GAAP financial measures have not been calculated in accordance with GAAP, should be considered only in addition to results prepared in accordance with GAAP and should not be considered as a substitute for, or superior to, GAAP measures. In addition, adjusted net income, adjusted net income per diluted common share, adjusted EBITDA, adjusted EBITDA margin, revenue growth (including by product offering) on a constant currency basis (expressed as a percentage) and adjusted free cash flow should not be construed as indicators of our operating performance, liquidity or cash flows generated by operating, investing and financing activities, as there may be significant factors or trends that they fail to address. We caution investors that non-GAAP financial information, by its nature, departs from traditional accounting conventions; accordingly, its use can make it difficult to compare our current results with our results from other reporting periods and with the results of other companies. Our management uses these non-GAAP financial measures, in conjunction with GAAP financial measures, as an integral part of managing the business and to, among other things: (i) monitor and evaluate the performance of our business operations, financial performance and overall liquidity; (ii) facilitate management’s internal comparisons of the historical operating performance of its business operations; (iii) facilitate management’s external comparisons of the results of its overall business to the historical operating performance of other companies that may have different capital structures and debt levels; (iv) review and assess the operating performance of our management team and, together with other operational objectives, as a measure in evaluating employee compensation; (v) analyze and evaluate financial and strategic planning decisions regarding future operating investments; and (vi) plan for and prepare future annual operating budgets and determine appropriate levels of 36 Table of Contents operating investments. Management believes that adjusted net income, adjusted net income per diluted common share, adjusted EBITDA, adjusted EBITDA margin, revenue growth / (decline) (including by product offering) on a constant currency basis (expressed as a percentage) and adjusted free cash flow are useful to investors because these measures enable investors to analyze Shutterstock’s operating results on the same basis as that used by management. Additionally, management believes that adjusted net income, adjusted net income per diluted common share, adjusted EBITDA and adjusted EBITDA margin provide useful information to investors about the performance of the Company’s overall business because such measures eliminate the effects of unusual or other infrequent charges that are not directly attributable to Shutterstock’s underlying operating performance and revenue growth / (decline) (including by product offering) on a constant currency basis (expressed as a percentage), provides useful information to investors by eliminating the effect of foreign currency fluctuations that are not directly attributable to Shutterstock’s operating performance. Management also believes that providing these non-GAAP financial measures enhances the comparability for investors in assessing Shutterstock’s financial reporting. Management believes that adjusted free cash flow is useful for investors because it provides them with an important perspective on the cash available for strategic measures, after making necessary capital investments in internal-use software and website development costs to support the Company’s ongoing business operations and provides them with the same measures that management uses as the basis for making resource allocation decisions. Our use of non-GAAP financial measures has limitations as an analytical tool, and these measures should not be considered in isolation or as a substitute for an analysis of our results as reported under GAAP, as the excluded items may have significant effects on our operating results and financial condition. Additionally, our methods for measuring non-GAAP financial measures may differ from other companies’ similarly titled measures. When evaluating our performance, these non-GAAP financial measures should be considered alongside other financial performance measures, including various cash flow metrics, net income and our other GAAP results. Our method for calculating adjusted net income, adjusted net income per diluted common share, adjusted EBITDA, adjusted EBITDA margin, revenue growth / (decline) (including by product offering) on a constant currency basis (expressed as a percentage) and adjusted free cash flow, as well as a reconciliation of the differences between each of our non-GAAP financial measures (adjusted EBITDA, adjusted net income, revenue growth / (decline) (including by product offering) on a constant currency basis (expressed as a percentage) and adjusted free cash flow), and each measure’s most directly comparable financial measure calculated and presented in accordance with GAAP, is presented below. The expense associated with the Giphy Retention Compensation related to (i) the one-time employment inducement bonuses and (ii) the vesting of the cash value of unvested Meta equity awards held by the employees prior to closing, which are reflected in operating expenses (together, the “Giphy Retention Compensation Expense - non-recurring”), are required payments in accordance with the terms of the acquisition. Meta’s sale of Giphy was directed by the CMA and accordingly, the terms of the acquisition were subject to CMA preapproval. Management considers the operating expense associated with these required payments to be unusual and non-recurring in nature. The Giphy Retention Compensation Expense - non-recurring is not considered ongoing expense necessary to operate the Company’s business. Therefore, such expenses have been included in the below adjustments for calculating adjusted EBITDA, adjusted EBITDA margin, adjusted net income and adjusted net income per diluted common share. 37 Table of Contents Adjusted Net Income and Adjusted Net Income Per Diluted Common Share We define adjusted net income as net income adjusted for the impact of non-cash equity-based compensation, the amortization of acquisition-related intangible assets, legal contingencies, goodwill impairment and related tax effects, workforce optimization, Giphy Retention Compensation Expense - non-recurring, unrealized gains and losses on investments, severance costs associated with strategic workforce optimizations, costs incurred associated with the Merger, and the estimated tax impact of such adjustments. We define adjusted net income per diluted common share as adjusted net income divided by weighted average diluted shares. The following is a reconciliation of net income to adjusted net income for each of the periods indicated (in thousands, except per share data): Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Net (loss) / income $ (155,939) $ 29,440 $ (203,508) $ 48,128 Add / (less) Non-GAAP adjustments: Non-cash equity-based compensation 12,536 15,625 25,908 33,509 Tax effect of non-cash equity-based compensation(1) (2,946) (3,672) (6,088) (7,875) Acquisition-related amortization expense(2) 9,564 9,581 19,163 19,278 Tax effect of acquisition-related amortization expense(1) (2,248) (2,252) (4,504) (4,531) Unrealized loss / (gain) on investment 2,963 (13,029) 18,268 (26,289) Goodwill impairment 173,738 — 173,738 — Tax effect of goodwill impairment(1) (10,371) — (10,371) — Workforce optimization - severance 2,963 121 9,043 301 Tax effect of workforce optimization - severance(1) (667) (27) (2,035) (68) Giphy retention compensation expense - non-recurring — 438 649 1,005 Tax effect of Giphy retention compensation expense - non-recurring(1) — (103) (153) (236) Merger related costs 3,680 8,710 6,535 20,571 Tax effect of Merger related costs(1) (828) (1,960) (1,470) (4,629) Legal contingency 5,000 — 33,000 — Tax effect of legal contingency (1) (7,425) — (7,425) — Adjusted net income $ 30,020 $ 42,872 $ 50,750 $ 79,164 Net (loss) / income per diluted common share $ (4.25) $ 0.82 $ (5.63) $ 1.35 Adjusted net income per diluted common share $ 0.82 $ 1.19 $ 1.40 $ 2.22 Weighted average diluted shares $ 36,703 $ 35,958 $ 36,126 35,642 (1)Statutory tax rates are used to calculate the tax effect of the adjustments. (2)Of these amounts, $8.9 million and $8.9 million are included in cost of revenue for the three months ended June 30, 2026 and 2025, respectively. The remainder of acquisition-related amortization expense is included in general and administrative expense in the Statement of Operations. Adjusted EBITDA and Adjusted EBITDA Margin We define adjusted EBITDA as net income adjusted for depreciation and amortization, non-cash equity-based compensation, Giphy Retention Compensation Expense - non-recurring, costs incurred associated with the Merger, foreign currency transaction gains and losses, severance costs associated with strategic workforce optimizations, legal contingencies, goodwill impairment, unrealized gains and losses on investments, interest income and expense and income taxes. We define adjusted EBITDA margin as the ratio of adjusted EBITDA to revenue. 38 Table of Contents The following is a reconciliation of net income to adjusted EBITDA for each of the periods indicated (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Net (loss) / income $ (155,939) $ 29,440 $ (203,508) $ 48,128 Add / (less) Non-GAAP adjustments: Interest expense 3,833 4,224 7,593 8,522 Interest income (479) (1,077) (1,280) (2,012) (Benefit) / provision for income taxes (4,992) 13,691 (6,798) 15,421 Depreciation and amortization 22,416 22,611 45,120 45,282 EBITDA $ (135,161) $ 68,889 $ (158,873) $ 115,341 Non-cash equity-based compensation 12,536 15,625 25,908 33,509 Giphy retention compensation expense - non-recurring — 438 649 1,005 Merger related costs 3,680 8,710 6,535 20,571 Foreign currency loss / (gain) (622) 1,482 (465) 1,162 Unrealized loss / (gain) on investment 2,963 (13,029) 18,268 (26,289) Legal contingency 5,000 — 33,000 — Workforce optimization - severance 2,963 121 9,043 301 Goodwill impairment 173,738 — 173,738 — Adjusted EBITDA $ 65,097 $ 82,236 $ 107,803 $ 145,600 Revenue $ 221,801 $ 266,990 $ 420,971 $ 509,610 Net (loss) / income margin (70.3) % 11.0 % (48.3) % 9.4 % Adjusted EBITDA margin 29.3 % 30.8 % 25.6 % 28.6 % Revenue Growth / (Decline) (including by product offering) on a Constant Currency Basis We define revenue growth (including by product offering), on a constant currency basis (expressed as a percentage), as the increase in current period revenues over prior period revenues, utilizing fixed exchange rates for translating foreign currency revenues for all periods in the comparison. Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Reported revenue (in thousands) $ 221,801 $ 266,990 $ 420,971 $ 509,610 Revenue (decline) / growth (17) % 21 % (17) % 17 % Revenue (decline) / growth on a constant currency basis (17) % 20 % (18) % 17 % Content reported revenue (in thousands) $ 165,664 $ 199,796 $ 343,790 $ 402,684 Content revenue (decline) / growth (17) % 18 % (15) % 17 % Content revenue (decline) / growth on a constant currency basis (16) % 16 % (15) % 17 % Data, Distribution, and Services reported revenue (in thousands) $ 56,137 $ 67,194 $ 77,181 $ 106,926 Data, Distribution, and Services revenue (decline) / growth (16) % 34 % (28) % 18 % Data, Distribution, and Services revenue (decline) / growth on a constant currency basis (19) % 35 % (30) % 18 % 39 Table of Contents Adjusted Free Cash Flow We define adjusted free cash flow as our net cash provided by operating activities, adjusted for capital expenditures, content acquisition, cash received related to Giphy Retention Compensation in connection with the acquisition of Giphy, and cash paid for Merger related costs. The following is a reconciliation of net cash provided by operating activities to adjusted free cash flow for each of the periods indicated (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Cash flow information: (in thousands) Net cash provided by operating activities $ 621 $ 26,836 $ 17,991 $ 52,083 Net cash used in investing activities $ (10,139) $ (14,965) $ (21,285) $ (26,199) Net cash used in financing activities $ (18,457) $ (13,878) $ (38,407) $ (29,699) Adjusted free cash flow: Net cash provided by operating activities $ 621 $ 26,836 $ 17,991 $ 52,083 Capital expenditures (10,115) (11,312) (21,710) (22,120) Content acquisitions (110) (4,081) (301) (4,978) Cash received related to Giphy Retention Compensation 109 369 477 861 Legal contingency settlement 35,000 — 35,000 — Merger related costs 2,970 5,686 10,150 15,036 Adjusted Free Cash Flow $ 28,475 $ 17,498 $ 41,607 $ 40,882