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SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

For the quarterly period ended June 30, 2004

OR

For the transition period from                      to                     

Commission File Number: 000-27241

KEYNOTE SYSTEMS, INC.

(Exact name of registrant as specified in its charter)

Registrant’s telephone number, including area code: (650) 403-2400

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 is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).    YES  x    NO  ¨

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date:

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KEYNOTE SYSTEMS, INC.

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PART I—FINANCIAL INFORMATION

KEYNOTE SYSTEMS, INC. AND SUBSIDIARIES

Index to Unaudited Condensed Consolidated Financial Statements

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KEYNOTE SYSTEMS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Dollars in thousands)

(Unaudited)

See accompanying notes to the condensed consolidated financial statements

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KEYNOTE SYSTEMS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Dollars in thousands, except per share amounts)

(Unaudited)

See accompanying notes to the condensed consolidated financial statements

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KEYNOTE SYSTEMS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

See accompanying notes to the condensed consolidated financial statements

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KEYNOTE SYSTEMS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(1) Basis of Presentation

The accompanying interim unaudited condensed consolidated balance sheets, and condensed consolidated statements of operations and cash flows reflect all normal recurring adjustments that are, in the opinion of management, necessary for a fair presentation of the financial position of Keynote Systems, Inc. and subsidiaries (the Company) at June 30, 2004, and the results of operations and cash flows for the interim periods ended June 30, 2004 and 2003.

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (SEC), and therefore, do not include all information and footnotes necessary for a complete presentation of the Company’s results of operations, financial position and cash flows. This report should be read in conjunction with the consolidated financial statements and notes thereto for the fiscal year ended September 30, 2003 included in the Company’s Report on Form 10-K as filed with the SEC.

The results of operations and cash flows for any interim period are not necessarily indicative of the Company’s results of operations and cash flows for any other future interim period or for a full fiscal year.

Excess occupancy costs are fixed costs associated with the unoccupied portion of the Company’s headquarters building, such as property taxes, insurance and depreciation. These particular costs represent the fixed costs of operating the Company’s headquarters building acquired in September 2002 and are based on the actual unoccupied square footage, which was determined to be 70% and 60% during the three and nine months ended June 30, 2004 and 2003, respectively.

(2) Stock-Based Compensation Plans

The Company accounts for stock option grants under Statement of Financial Accounting Standards (SFAS) No. 123, “Accounting for Stock-Based Compensation” (“SFAS No. 123”), which permits the use of the intrinsic-value method in accordance with Accounting Principles Board (APB) Opinion No. 25, “Accounting for Stock Issued to Employees”, and related interpretations. No compensation expense is recognized on the grant date, when the option exercise price equals or exceeds the market price of the underlying common stock.

The following table illustrates the effect on net income (loss) and basic and diluted net income (loss) per share if the Company had accounted for its stock option and stock purchase plans under the fair value method of accounting under SFAS No. 123 as amended by SFAS No. 148, “Accounting for Stock-Based Compensation—Transition and Disclosure” (in thousands, except per share amounts):

The net tax effect on the stock-based employee compensation determined under the fair value based method for all awards is zero.

The amounts reflected as stock-based compensation included in pro forma net loss for the three and nine months ended June 30, 2003 have been revised from the historically reported amounts. The revision was required to correct an immaterial error in these amounts associated with the Company’s April 2001 Stock Repurchase Program under SFAS No. 123.

The fair value of each option was estimated on the date of grant using the Black-Scholes option pricing model. Weighted-average assumptions for options granted are as follows:

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KEYNOTE SYSTEMS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(3) Revenue Recognition

Revenue consists of subscription services revenue and consulting and support services revenue. Subscription services revenue consists of fees from subscriptions to the Company’s web performance measurement and management services. Subscription services revenue is deferred upon invoicing and is recognized ratably over the service period, commencing on the day service is provided, generally ranging from one to twelve months. For some customers, subscription services revenue is invoiced monthly upon completion of the services. Deferred revenue is comprised of all unearned revenue, primarily unearned subscription services revenue, and is recorded as deferred revenue on the balance sheet until the revenue is earned. The Company does not generally grant refunds. All discounts granted reduce revenue. Revenue is not recognized for free trial periods. Consulting and support services revenue consists of fees generated by the Company’s consulting and support services, and is recognized as the services are performed, typically over a period of one to three months. For consulting projects that span more than one month, the Company recognizes revenue as milestones or deliverables are completed.

(4) Comprehensive Income (Loss)

Comprehensive income (loss) includes net income (loss), unrealized gains and losses on short-term investments in debt securities and issuances and foreign currency translation. The unrealized gains and losses on short-term investments in debt securities and issuances and foreign currency translation are excluded from earnings and reported as a component of stockholders’ equity. The functional currency of the Company’s foreign operations is the applicable local currency or United States dollar. Gains and losses from foreign currency transactions are reflected in the condensed consolidated statements of operations as incurred. The components of comprehensive income (loss) are as follows (in thousands):

The tax effect on the foreign currency translation gain/(loss) is immaterial.

(5) Financial Instruments and Concentration of Risk

The carrying value of the Company’s financial instruments, including cash and cash equivalents, short-term investments, accounts receivable, and accounts payable and accrued expenses, approximates fair market value due to their short-term nature. Financial instruments that subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents, short-term investments and accounts receivable.

Credit risk is concentrated in North America, but exists in Europe as well. The Company generally requires no collateral from customers; however, throughout the collection process, it conducts an ongoing evaluation of customers’ ability to pay. The Company’s accounting for its allowance for doubtful accounts is determined based on historical trends, experience and current market and industry conditions. Management regularly reviews the adequacy of the Company’s allowance for doubtful accounts by considering the aging of accounts receivable, the age of each invoice, each customer’s expected ability to pay and the Company’s collection history with each customer. Management reviews invoices greater than 60 days past due to determine whether an allowance is appropriate based on the receivable balance. In addition, the Company maintains a reserve for all other invoices, which is calculated by applying a percentage to the outstanding accounts receivable balance, based on historical collection trends. The allowance for doubtful accounts represents management’s best current estimate, but changes in circumstances relating to accounts receivable, including unforeseen declines in market conditions and collection rates, may result in additional allowances in the future. The Company believes that it has adequately reserved for doubtful accounts as of the date of each balance sheet presented herein. At June 30, 2004, one single customer accounted for more than 10% of the Company’s total accounts receivable, of which 32% of the receivable was subsequently collected and the remaining accounts receivable balance was not yet due as of June 30, 2004. At June 30, 2003, one single customer accounted for more than 10% of the Company’s total accounts receivable, which receivable was subsequently collected in July 2003. For the three and nine months ended June 30, 2004 and 2003, no single customer accounted for more than 10% of the Company’s total revenue during each period. For the three months ended June 30, 2004 and 2003, the top ten customers accounted for approximately 35% and 32% of total revenue, respectively. For the nine months ended June 30, 2004 and 2003, the top ten customers accounted for approximately 34% and 31% of total revenue, respectively.

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KEYNOTE SYSTEMS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(6) Investments

The Company considers all highly liquid investments with original maturities of three months or less when acquired to be cash equivalents. The Company’s short-term investments consist of investment-grade corporate and government debt securities and issuances with Moody’s ratings of A2 or better and which mature in two years or less. All of the Company’s cash equivalents and short-term investments are classified as available-for-sale. These securities are carried at fair market value, with unrealized gains and losses excluded from earnings and reported as a component of other comprehensive income (loss). The following table summarizes the Company’s short-term investments in investment-grade debt securities as of June 30, 2004 (in thousands):

The following table summarizes the contractual maturities of fixed maturity investments available for sale at June 30, 2004 (in thousands). Expected maturities of debt securities and issuances will differ from contractual maturities of the debt securities and issuances because borrowers may have the right to call or repay obligations with or without call or prepayment penalties.

(7) Goodwill and Identifiable Intangible Assets

The following table represents the changes in goodwill during the nine months ended June 30, 2004 (in thousands):

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KEYNOTE SYSTEMS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

As of June 30, 2004, the net carrying value of identifiable intangible assets was approximately $1.8 million. During the first quarter of fiscal 2004, the Company acquired approximately $84,000 of technology-based and $43,000 of customer-based intangible assets related to the acquisition of the business of the MatrixNet division of Xaffire, Inc. (“MatrixNet”) (see Note 9). During the third quarter of fiscal 2004, the Company acquired approximately $480,000 of technology-based and $158,000 of customer-based intangible assets related to the acquisition of NetRaker Corporation (“NetRaker”) (see Note 9). As a result, the gross carrying value of the identifiable intangible assets for the nine months ended June 30, 2004 increased by $765,000. These assets are being amortized over a three-year period, with minimal expected residual values. For the three and nine months ended June 30, 2004, the amortization expense for intangible assets was $420,000 and approximately $1.2 million, respectively. The components of identifiable intangible assets are as follows (in thousands):

The amortization expense for existing intangible assets as of June 30, 2004 is estimated to be approximately $369,000 for the remainder of fiscal 2004, approximately $955,000 for fiscal 2005, approximately $350,000 for fiscal 2006, and approximately $113,000 for fiscal 2007, assuming no impairment.

(8) Net Income (Loss) Per Share

Basic earnings per share is computed using the weighted-average number of common shares outstanding, and diluted earnings per share is computed using the weighted-average number of common shares outstanding, and all dilutive potential common shares outstanding, using the treasury stock method. For the three and nine months ended June 30, 2004, dilutive potential common shares outstanding reflect shares issuable under the Company’s stock option and equity incentive plans. For the three and nine months ended June 30, 2004, 736,000 and 801,000 shares with a weighted average exercise price of $40.65 and $38.38, respectively, were considered anti-dilutive and excluded from the denominator for diluted net income per share. For the three and nine months ended June 30, 2003, 859,000 and 484,000 net dilutive potential common shares with a weighted average price of $9.66 and $8.55, respectively, computed using the treasury stock method were considered anti-dilutive and excluded from the denominator for diluted net loss per share as a result of the Company’s net loss.

The following table summarizes the Company’s net income (loss) per share computations for the three and nine months ended June 30, 2004, and 2003 (in thousands, except per share amounts):

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KEYNOTE SYSTEMS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(9) Acquisitions

In April 2004, the Company acquired NetRaker Corporation, a provider of online customer experience management solutions that help e-business managers measure, evaluate and improve the design and navigability of their websites. The total price of approximately $3.6 million includes a $2.6 million initial cash payment made in April 2004, an estimated $500,000 for additional purchase price to be paid based on the final calculation of the NetRaker net assets as of the closing date, and approximately $535,000 of direct acquisition costs. An additional cash payment could be made if certain revenue and profitability targets are achieved by the acquired business during the twelve months ending March 31, 2005. The Company believes this acquisition will enhance and broaden its customer experience management solutions for enterprise customers as well as allow it to target e-business marketing executives within Fortune 500 companies, such as usability and market research managers.

The preliminary purchase price allocation was based on the estimated fair value of the assets and liabilities of the business at the acquisition date, including technology-based and customer-based intangible assets acquired. The Company has currently estimated the purchase price allocation to intangible assets and expects to complete its formal valuation by September 30, 2004. The following table summarizes the estimated fair value of the assets acquired and liabilities assumed at the date of acquisition (in thousands):

In December 2003, the Company acquired the business of the MatrixNet division of Xaffire, Inc. for $582,000 in cash. The MatrixNet service measures performance from network agent locations to a customer’s web infrastructure or devices. The preliminary purchase price allocation was based on the estimated fair value of the assets and liabilities of the business at the acquisition date, including the technology-based and customer-based intangible assets acquired. During the three months ended March 31, 2004, the Company updated its preliminary purchase price allocation for the fair value of the property and equipment that were acquired as a result of the acquisition of the business of MatrixNet. Therefore, goodwill decreased by $34,000, from $306,000 initially recorded to $272,000. The following table summarizes the adjusted estimated fair value of the assets acquired and liabilities assumed at the date of acquisition (in thousands):

(10) Commitments and Contingencies

(A) Leases

The Company leases certain of its facilities under non-cancelable operating leases, which expire on various dates through December 2005. At June 30, 2004, future minimum payments under the leases are as follows (in thousands):

(B) Commitments

The Company has contingent commitments to 116 bandwidth and collocation providers amounting to $818,000 for 100 locations that represent one to twelve months commitments,. The commitments become due if the Company terminates any of these agreements prior to their expiration. At present, the Company does not intend to terminate any of these agreements prior to their expiration.

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KEYNOTE SYSTEMS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

(C) Legal Proceedings

Beginning on August 16, 2001, several class action lawsuits were filed in the United States District Court for the Southern District of New York against us, certain of our officers, and the underwriters of our initial public offering. These lawsuits were essentially identical, and were brought on behalf of those who purchased our securities between September 24, 1999 and August 19, 2001. These complaints alleged generally that the underwriters in certain initial public offerings, including ours, allocated shares in those initial public offerings in unfair or unlawful ways, such as requiring the purchaser to agree to buy in the aftermarket at a higher price or to buy shares in other companies with higher than normal commissions. The complaint also alleged that we had a duty to disclose the activities of the underwriters in the registration statement relating to our initial public offering. The plaintiffs’ counsel and the issuer defendants’ counsel have reached a preliminary settlement agreement, without any payments by the Company. The settlement awaits approval by the Court.

We are subject to legal proceedings, claims, and litigation arising in the ordinary course of business. While the outcome of these matters is currently not determinable, management does not expect that the ultimate costs to resolve these matters will have a material adverse effect on our consolidated financial position, results of operations, or cash flows.

(11) Stock Repurchase Program

The Company’s Board of Directors approved a program to repurchase shares of its common stock in January 2001. Pursuant to the stock repurchase program, a total of 10.4 million shares had been repurchased as of June 30, 2004, for approximately $90.1 million. For the three and nine months ended June 30, 2004, the Company did not repurchase any shares of its common stock. For the three months ended June 30, 2003, the Company repurchased approximately 4.3 million shares for approximately $40.5 million, primarily in connection with its issuer tender offer that was completed in May 2003. For the nine months ended June 30, 2003, the Company repurchased approximately 8.9 million shares for approximately $79.2 million, primarily in connection with its issuer tender offer in November 2002 and May 2003.

At June 30, 2004, the Company had authorization to repurchase up to approximately $39.9 million of its common stock pursuant to this stock repurchase program.

(12) Geographic and Segment Information

The Company has determined that it operates in a single reportable operating segment: the development and sale of services to measure, test, assure and improve the quality of service of web sites. While the Company operates under one operating segment, management reviews revenue under two categories – measurement services revenue and management solutions revenue. Management continues to allocate resources based on the one operating segment.

The following table identifies which services fall under measurement services and management solutions and where they are recorded in the condensed consolidated statements of operations listed in alphabetical order:

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KEYNOTE SYSTEMS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The following table summarizes measurement services and management solutions revenue (in thousands):

International sales were approximately 6% of total revenue for each of the three months ended June 30, 2004 and 2003, respectively. International sales were approximately 6% and 7% of total revenue for the nine months ended June 30, 2004 and 2003, respectively.

(13) Subsequent Event

On July 2, 2004, the Company acquired Hudson Williams, Inc. (“Hudson Williams”), a provider of performance management and load testing consulting services for an initial cash payment of approximately $1.6 million plus a cash payment of $300,000 as a preliminary payment for the Hudson Williams estimated net assets as of the closing date. The finalization of this payment will be made by August 29, 2004 based on the final calculation of the Hudson Williams net assets as of the closing date, currently estimated to be up to approximately $400,000. The Company has not finalized its purchase price allocation, but expects the allocation between goodwill and intangible assets to be completed by September 30, 2004. The Company believes this acquisition will enhance and broaden its enterprise solutions group and provide its northeast customers a more local access to Keynote expertise.

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The following information should be read in conjunction with the interim unaudited condensed consolidated financial statements and related notes.

Except for historical information, this Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements involve risks and uncertainties, including, among other things, statements regarding our anticipated costs and expenses and revenue mix. These forward-looking statements include, among others, statements including the words “expect,” “anticipate,” “intend,” “believe” and similar language. Our actual results may differ significantly from those projected in the forward-looking statements. Factors that might cause or contribute to these differences include, but are not limited to, those discussed in this section and in our annual report on Form 10-K for the fiscal year ended September 30, 2003, in the section “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Factors That May Impact Future Operating Results” and elsewhere in that report. You should also carefully review the risks described in other documents we file from time to time with the Securities and Exchange Commission, including the annual report on Form 10-K, the quarterly reports on Form 10-Q and current reports on Form 8-K. You are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date of this quarterly report on Form 10-Q. We undertake no obligation to publicly release any revisions to the forward-looking statements or reflect events or circumstances after the date of this document.

Overview

We offer Web performance measurement and management services that enable corporate enterprises to monitor, benchmark, test and tune, diagnose and optimize their e-business systems both inside and outside the firewall. Keynote’s services provide enterprise customers with Total Performance Management solutions enabling them to increase return on investment, save money and efficiently link information technology resources to e-business goals. Total Performance Management includes a broad portfolio of cost-effective measurement, monitoring, performance management, load testing, content quality testing and usability testing services. Keynote’s goal is to empower customers to deliver an optimal experience to end-users and to gain competitive advantage, while helping them reduce unnecessary capital expenditures and leverage enterprise management software they already own.

Revenue consists of subscription services revenue and consulting and support services revenue. Subscription services revenue consists of fees from subscriptions to our Internet measurement, monitoring, testing, and real user customer experience, and diagnostic services. Subscription services revenue is deferred upon invoicing and is recognized ratably over the service period, commencing on the day service is provided, generally ranging from one to twelve months. For some customers, subscription services revenue is invoiced monthly upon completion of the services. Deferred revenue is comprised of all unearned revenue, primarily unearned subscription services revenue and is recorded as deferred revenue on our balance sheet until the revenue is earned. As of June 30, 2004, we had recorded approximately $6.2 million of deferred revenue. We do not generally grant refunds. All discounts granted reduce revenue. Revenue is not recognized during free trial periods. Consulting and support services revenue, which consists of fees generated by our consulting and support services and our load testing services, is recognized as the services are performed, typically over a period of one to three months. For longer consulting projects that span more than one month, we recognize revenue as milestones or deliverables are completed.

A majority of our subscription services revenue comes from our web performance benchmarking services, which include our Perspective services. Subscription services revenue also includes our Red Alert and NetMechanic monitoring and alarm services, Test Perspective, WebEffective Intelligence Platform, performance management subscription services, our private agent and application performance management services. Our customers purchase these services for an initial term of three to twelve months and then may renew on an annual, semi-annual, or month-to-month basis.

Subscription services fees can vary based on the number of URLs measured, the number of devices monitored, the number of measurement locations, the number of users, the number of hours, the frequency of the measurements, the number of private agents, the additional features ordered, and the type of services purchased.

We offer our consulting and support services on a per engagement basis. Consulting and support services revenue amounted to approximately 11% and 8% of total revenue for the three months ended June 30, 2004 and 2003, respectively. Consulting and support services revenue amounted to approximately 11% and 9% of total revenue for the nine months ended June 30, 2004 and 2003, respectively. We believe that consulting and support services revenue may increase somewhat in the future as a percentage of total revenue, as our existing consulting and support services become more widely used, as a result of acquisitions and as we introduce additional services that require consulting expertise. However, we cannot assure you that this revenue will increase in absolute dollars in future periods.

In addition to analyzing revenue for subscription services and consulting and support services, management also internally analyzes revenue categorized as measurement services and management solutions.

The following table identifies which services are categorized as measurement services and management solutions and where they are recorded in our condensed consolidated statements of operations listed in alphabetical order):

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The following table summarizes measurement services and management solutions revenue (in thousands):

Measurement services revenue decreased by $207,000 for the three months ended June 30, 2004 as compared to the corresponding period in fiscal 2003. Measurement services revenue represented 66% and 77% of total revenue for the three months ended June 30, 2004 and 2003, respectively. Measurement services revenue decreased by approximately $1.1 million for the nine months ended June 30, 2004 as compared to the corresponding period in fiscal 2003. Measurement services revenue represented 69% and 77% of total revenue for the nine months ended June 30, 2004 and 2003, respectively. The decrease in measurement services revenue was mainly attributable to reduced subscriptions for our Website Perspective service, resulting in fewer measurements, partially offset by increases in our Transaction Perspective and Red Alert monitoring services as well as revenue from our Streaming Perspective and Application Perspective services which were newly introduced in fiscal 2004.

Management solutions revenue increased by approximately $1.5 million for the three months ended June 30, 2004 as compared to the corresponding period in fiscal 2003. Management solutions revenue represented 34% and 23% of total revenue for the three months ended June 30, 2004 and 2003, respectively. Management solutions revenue increased by approximately $2.6 million for the nine months ended June 30, 2004 as compared to the corresponding period in fiscal 2003. Management solutions revenue represented 31% and 23% of total revenue for the nine months ended June 30, 2004 and 2003, respectively. The increase in management solutions revenue as listed in descending order of impact, was mainly attributable to increased contribution from our Enterprise Solutions, WebEffective Intelligence Platform services as a result of our acquisition of NetRaker in April 2004, Wireless Perspective, Testing and Tuning solutions, as well as Network Perspective, which was newly introduced in December 2003 as a result of our acquisition of the business of MatrixNet division of Xaffire, Inc. (“MatrixNet”).

We believe that the challenges for our business include 1) increasing management solutions revenue while continuing to stabilize measurement services revenue, 2) integrating our recent two acquisitions and 3) controlling our expenses for the fourth quarter of fiscal 2004 at 8% to 10% higher than the third quarter of fiscal 2004, assuming no acquisitions.

At June 30, 2004, one single customer accounted for more than 10% of our total accounts receivable, of which 32% of the receivable was subsequently collected and the remaining accounts receivable balance was not yet due as of June 30, 2004. At June 30, 2003, one single customer accounted for more than 10% of our total accounts receivable, which receivable was subsequently collected in July 2003. For the three and nine months ended June 30, 2004 and 2003, no single customer accounted for more than 10% of total revenue during each period. For the three months ended June 30, 2004 and 2003, the top ten customers accounted for approximately 35% and 32% of total revenue, respectively. For the nine months ended June 30, 2004 and 2003, the top ten customers accounted for approximately 34% and 31% of total revenue, respectively.

We cannot be certain that customers that have accounted for significant revenue in past periods, individually or in aggregate, will renew our services and continue to generate revenue in any future period. In addition, our customers that have monthly renewal arrangements may terminate their services at any time with little or no penalty. If we lose a major customer or a group of significant customers, our revenue could decline significantly.

Costs of subscription services consist of connection fees to major telecommunication and internet access providers for bandwidth usage of our measurement computers, which are located around the world, depreciation, maintenance and other equipment charges for our measurement and data collection infrastructure.

Costs of consulting and support services consist of compensation expenses and related costs for consulting and support services personnel, all load-testing bandwidth costs and related network infrastructure costs.

Results of Operations

The following table sets forth, as a percentage of total revenue, certain condensed consolidated statements of operations data for the periods indicated. All information is derived from our condensed consolidated financial statements included in this Form 10-Q. The operating results are not necessarily indicative of the results for any future period.