VERI · Veritone, Inc.

Veritone's Item 4.02 disclosure reveals multiple accounting errors primarily centered on revenue recognition, with the largest stemming from improper valuation of non-monetary consideration in an on-premise software sale, overstating Q3 revenue by $2.2 million or 8% of previously reported figures. Additional errors include premature revenue booking before satisfying ASC 606 Step 1, clerical billing issues, cost of revenue overstatements, and agent-principal misclassifications under ASC 606, collectively reducing restated Q3 revenue to $26.6 million from $29.1 million and nine-month revenue to $72.3 million from $75.6 million. Balance sheet impacts include lower accounts receivable ($34.3 million restated vs. $35.2 million), reduced total assets ($198.6 million vs. $200.2 million), and decreased stockholders' equity ($15.5 million vs. $16.0 million). The company also identified a new material weakness in internal controls over non-routine revenue transactions, exacerbating existing ICFR deficiencies previously disclosed at September 30, 2025, and reconfirmed ineffective disclosure controls as of December 31, 2025. Investors should note that related communications relying on these statements are unreliable, and a Q3 10-Q/A restatement is forthcoming, alongside immaterial Q2 corrections. Discussions with auditor Grant Thornton LLP have occurred, signaling coordinated remediation efforts.