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We also expect increasing legal complexity and uncertainty regarding how and under what circumstances we can transfer, process, or receive certain data that is critical to our operations, including data shared between countries or regions in which we operate and data shared among our products and services. These various developments in relation to international personal data transfers require us to implement new or revised documentation and processes, within the relevant time frames, and are subject to ongoing scrutiny and potential future challenge, leading to additional costs and increasing our overall risk exposure. For example, for data the EU and UK GDPR prohibit transfers of personal information from the European Economic Area (“EEA”) or UK to the United States, countries not formally deemed adequate by the European Commission has adopted an adequacy decision or the UK Information Commissioner’s Office (“UK ICO”), respectively, including the U.S., unless particular compliance mechanisms (and, if necessary, certain safeguards) are implemented. The mechanisms that we and many other companies rely upon for entities self-certified under EEA and UK data transfers (for example, standard contractual clauses or the new EU-U.S. EU-US Data Privacy Framework (“DPF”). The DPF does not apply to the UK, and in October 2023, a UK-U.S. Data Bridge came into force to facilitate transfers of personal data from the UK to the United States. In addition, the other bases upon which we rely to transfer such data, such as Standard Contractual Clauses (“SCCs”), have been subjected to regulatory and judicial scrutiny. The Court of Justice of the EU ruled in July 2020 that reliance on the SCCs alone may not necessarily be sufficient in all circumstances and transfers must be assessed on a case-by-case basis. In June 2021, the European Commission published revised SCCs for data transfers from the EU, but there is some uncertainty around whether the revised SCCs can be relied on for data transfers to non-EU entities subject to the GDPR. The European Commission has stated an intention to publish a new set of SCCs applicable to such transfers to non-EU entities subject to the GDPR. The UK ICO has published its own International Data Transfer Agreement and the International Data Transfer Addendum to the SCCs (the “IDTA”), which came into force in March 2022. If the new DPF is invalidated in the future and we are unable to continue to rely on SCCs and the IDTA or validly rely upon other alternative means of data transfers from the EU and the UK Extension to the United States, EU-US Data Privacy Framework) are the subject of legal challenge, regulatory interpretation, and judicial decisions. While the U.S. and the EU reached agreement on the EU-US Data Privacy Framework (and similar agreements were reached with respect to the UK) and while we currently self-certify to the EU-US Data Privacy Framework, the Swiss-US Data Privacy Framework, and the UK Extension, there are legal challenges to this data transfer mechanism as well. We may suffer additional costs, complaints or regulatory investigations, inquiries, or fines, and we may be unable to operate material portions of our business in the EU or the UK, and/or stop using certain tools and vendors and make other operational changes, which would harm our business, results of operations, financial condition, and prospects. prospects if this data transfer mechanism or others are invalidated.

Net cash provided by operating activities was $690.9 million in the year ended December 31, 2025, resulting primarily from net income of $529.7 million in the year ended December 31, 2025, adjustments for non-cash items, primarily related to stock-based compensation expense of $343.2 million, and an increase in accounts payable and accrued expenses and other liabilities of $108.9 million due to timing of payments. These increases were partially offset by an increase in accounts receivable of $241.4 million related to an increase in advertising revenue, an increase in prepaid expenses and other assets of $37.1 million due to timing of prepayments, and amortization of premium (accretion of discount) on marketable securities, net, of $(28.2) million. Net cash provided by operating activities was $222.1 million in the year ended December 31, 2024, resulting primarily from adjustments for non-cash items, primarily related to stock-based compensation expense of $801.6 million, and an increase in accrued expenses and other liabilities of $59.3 million due to timing of payments. These increases were partially offset by net loss of $(484.3) million, an increase in accounts receivable of $104.3 million related to an increase in advertising revenue, and amortization of premium (accretion of discount) on marketable securities, net, of $(43.4) million. Net cash used in operating activities was $(75.1) million in the year ended December 31, 2023, resulting primarily from net loss of $(90.8) million, and an increase in accounts receivable of $53.3 million related to an increase in advertising revenue. These increases were partially offset by adjustments for non-cash items, primarily related to stock-based compensation expense of $47.6 million, and an increase in accounts payable and accrued expenses and other liabilities of $25.2 million due to timing of payments.

From time to time, we may become involved in various legal and regulatory proceedings, claims or purported class actions related to, among other things, alleged infringement of third party patents and other legal matters intellectual property rights, commercial, corporate and securities, labor and employment, wage and hour and other claims arising in the normal course of business. We record a loss contingency when it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. We also disclose material contingencies when we believe a loss is not probable but reasonably possible. Accounting for contingencies requires us to use judgment related to both the likelihood of a loss and the estimate of the amount or range of loss. We are not aware of any pending matters, individually or in the aggregate, that are expected to have a material adverse impact on our results of operations, financial position, or cash flows as of December 31, 2024 and 2023. Legal fees and other expenses associated with such matters are expensed as incurred.

We hold investments in marketable securities consisting of U.S. and non-U.S. government securities, investment-grade corporate and government agency securities, certificates of deposit, time deposits, and commercial paper. We classify our marketable securities as available-for-sale investments in current assets because they represent investments available for current operations. Our available-for-sale investments are carried at fair value with any unrealized gains and losses included in accumulated other comprehensive income (loss) in stockholders’ equity (deficit). Expected losses from credit related impairment, if any, are recognized through an allowance for credit losses and adjusted each period for changes in credit risk. Gains or losses on the sale or maturities of marketable securities are determined using the specific identification method and recorded in other income (expense), net in our consolidated statements of operations.