“We continue to expect expenses to ramp through the fourth quarter as we invest in the product pipeline and accelerate the journey from AI prototype to production.”

In context

“commercial business, as it does not take into account contracts within an initial term of less than 12 months and contractual obligations that fall beyond termination for convenience clauses, both of which are common in most of our government business. Turning to margin and expense, adjusted gross margin, which excludes stock-based compensation expense was 82% for the quarter. Adjusted income from operations, which excludes stock-based compensation expense and related employer payroll taxes was $276 million, representing adjusted operating margin of 38% and marking the eighth consecutive quarter of expanding adjusted operating margins. Q3 adjusted expense was $450 million, up 6% sequentially and 14% year-over-year, primarily driven by our continued investment in AIP and technical talent. We continue to expect expenses to ramp through the fourth quarter as we invest in the product pipeline and accelerate the journey from AI prototype to production. In the third quarter, we generated GAAP operating income of $113 million, representing a 16% margin. We generated GAAP net income of $144 million, representing a 20% margin. Third quarter adjusted earnings per share was $0.10 and GAAP earnings per share was $0.06. As previously communicated, we've aligned our compensation program with the performance of the company's goals, including its stock price. On the back of the company's strong performance, our inclusion in the S&P 500 and the increase in our stock price, we will continue to monitor if we become required to accelerate stock-based compensation expenses if certain market based vesting criteria are achieved earlier than expected. Additionally, our combined revenue growth and adjusted operating margin accelerated to 68% in the third q”