Model N (MODN) 10-Q 7 Feb 23 2023 Q1 Quarterly report Financial data

Cover

Cover - shares	3 Months Ended
	Dec. 31, 2022	Jan. 26, 2023
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Dec. 31, 2022
Document Transition Report	false
Entity File Number	001-35840
Entity Registrant Name	Model N, Inc.
Entity Incorporation, State	DE
Entity Tax Identification Number	77-0528806
Entity Address, Street Address	777 Mariners Island Boulevard,
Entity Address, Suite	Suite 300
Entity Address, City	San Mateo,
Entity Address, State	CA
Entity Address, Postal Zip Code	94404
City Area Code	650
Local Phone Number	610-4600
Title of each class	Common Stock, par value $0.00015 per share
Trading Symbol	MODN
Name of each exchange on which registered	NYSE
Entity Current Filing Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		37,734,691
Amendment Flag	false
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q1
Entity Central Index Key	0001118417
Current Fiscal Year End Date	--09-30

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2022	Sep. 30, 2022
Current assets
Cash and cash equivalents	$ 175,194	$ 193,524
Funds held for customers	134	603
Accounts receivable, net of allowance for doubtful accounts of $185 as of December 31, 2022 and $102 as of September 30, 2022	66,118	49,121
Prepaid expenses	5,137	5,772
Other current assets	14,209	12,516
Total current assets	260,792	261,536
Property and equipment, net	1,566	1,838
Operating lease right-of-use assets	13,175	15,392
Goodwill	65,665	65,665
Intangible assets, net	35,354	37,362
Other assets	10,277	10,454
Total assets	386,829	392,247
Current liabilities
Accounts payable	5,040	5,820
Customer funds payable	134	603
Accrued employee compensation	11,014	26,712
Accrued liabilities	3,621	6,860
Operating lease liabilities, current portion	4,586	4,651
Deferred revenue, current portion	67,081	62,282
Total current liabilities	91,476	106,928
Long term debt	169,439	135,417
Operating lease liabilities, less current portion	10,013	12,142
Other long-term liabilities	3,364	3,139
Total liabilities	274,292	257,626
Commitments and contingencies
Stockholders’ equity
Common Stock, $0.00015 par value; 200,000 shares authorized; 37,734 and 37,358 shares issued and outstanding at December 31, 2022 and September 30, 2022, respectively	6	6
Preferred Stock, $0.00015 par value; 5,000 shares authorized; no shares issued and outstanding	0	0
Additional paid-in capital	381,733	421,473
Accumulated other comprehensive loss	(2,214)	(2,413)
Accumulated deficit	(266,988)	(284,445)
Total stockholders’ equity	112,537	134,621
Total liabilities and stockholders’ equity	$ 386,829	$ 392,247

Condensed Consolidated Balanc_2

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Dec. 31, 2022	Sep. 30, 2022
Statement of Financial Position [Abstract]
Accounts receivable, allowance for doubtful accounts	$ 185	$ 102
Common Stock, par value (in dollars per share)	$ 0.00015	$ 0.00015
Common Stock, shares authorized (in shares)	200,000,000	200,000,000
Common Stock, shares issued (in shares)	37,734,000	37,358,000
Common Stock, shares outstanding (in shares)	37,734,000	37,358,000
Preferred Stock, par value (in dollars per share)	$ 0.00015	$ 0.00015
Preferred Stock, shares authorized (in shares)	5,000,000	5,000,000
Preferred Stock, shares issued (in shares)	0	0
Preferred Stock, shares outstanding (in shares)	0	0

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Revenues
Total revenues	$ 59,154	$ 51,542
Cost of revenues
Total cost of revenues	26,271	22,651
Gross profit	32,883	28,891
Operating expenses
Research and development	12,764	11,427
Sales and marketing	12,977	11,039
General and administrative	10,691	8,439
Total operating expenses	36,432	30,905
Loss from operations	(3,549)	(2,014)
Interest expense, net	134	3,778
Other expenses (income), net	(65)	100
Loss before income taxes	(3,618)	(5,892)
Provision for income taxes	432	374
Net loss	$ (4,050)	$ (6,266)
Net loss per share attributable to common stockholders:
Basic (in dollars per share)	$ (0.11)	$ (0.17)
Diluted (in dollars per share)	$ (0.11)	$ (0.17)
Weighted average number of shares used in computing net loss per share attributable to common stockholders:
Basic (in shares)	37,527	36,223
Diluted (in shares)	37,527	36,223
Subscription
Revenues
Total revenues	$ 44,214	$ 38,088
Cost of revenues
Total cost of revenues	15,606	13,916
Professional services
Revenues
Total revenues	14,940	13,454
Cost of revenues
Total cost of revenues	$ 10,665	$ 8,735

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands	3 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Statement of Comprehensive Income [Abstract]
Net loss	$ (4,050)	$ (6,266)
Other comprehensive gain (loss), net of tax
Unrealized gain (loss) on cash flow hedges	239	(31)
Change in unrealized gain on investments	26	0
Change in foreign currency translation gain (loss)	(66)	18
Total comprehensive loss	$ (3,851)	$ (6,279)

Condensed Consolidated Statem_3

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Cash flows from operating activities
Net loss	$ (4,050)	$ (6,266)
Adjustments to reconcile net loss to net cash provided by operating activities
Depreciation and amortization	2,273	2,240
Stock-based compensation	10,404	6,986
Amortization of debt discount and issuance costs	302	2,655
Deferred income taxes	157	158
Amortization of capitalized contract acquisition costs	1,196	982
Other non-cash charges	56	40
Changes in assets and liabilities, net of acquisition
Accounts receivable	(17,080)	(6,499)
Prepaid expenses and other assets	43	1,202
Accounts payable	(775)	(2,229)
Accrued employee compensation	(10,630)	(8,367)
Other current and long-term liabilities	(4,961)	(1,542)
Deferred revenue	4,773	955
Net cash used in operating activities	(18,292)	(9,685)
Cash flows from investing activities
Purchases of property and equipment	(26)	(325)
Net cash used in investing activities	(26)	(325)
Cash flows from financing activities
Proceeds from exercise of stock options and issuance of common stock under employee stock purchase plan	27	72
Net changes in customer funds payable	(469)	276
Net cash provided by (used in) financing activities	(442)	348
Effect of exchange rate changes on cash and cash equivalents	(39)	(16)
Net decrease in cash and cash equivalents	(18,799)	(9,678)
Cash and cash equivalents
Beginning of period	194,127	165,783
End of period	$ 175,328	$ 156,105

The Company and Significant Acc

The Company and Significant Accounting Policies and Estimates	3 Months Ended
	Dec. 31, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
The Company and Significant Accounting Policies and Estimates	The Company and Significant Accounting Policies and Estimates Model N, Inc. (“Model N,” “we,” “us,” “our,” and “the Company”) was incorporated in Delaware on December 14, 1999. The Company is a provider of cloud revenue management solutions for the life sciences and high tech industries. The Company’s software and business services enable its customers to maximize revenues and reduce revenue compliance risk by transforming their revenue life cycle from a series of tactical, disjointed operations into a strategic end-to-end process, which enables them to manage the strategy and execution of pricing, contracting, incentives and rebates. The Company’s corporate headquarters are located in San Mateo, California, with additional offices in the United States, India and Switzerland. Fiscal Year The Company’s fiscal year ends on September 30. References to fiscal year 2023, for example, refer to the fiscal year ending September 30, 2023. Basis for Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Certain information and note disclosures normally included in the financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. The unaudited condensed consolidated balance sheet as of September 30, 2022 has been derived from the audited financial statements which are included in our Annual Report on Form 10-K for the fiscal year ended September 30, 2022 (“the Annual Report”) on file with the SEC. The unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the Annual Report. In the opinion of management, the unaudited interim consolidated financial statements include all the normal recurring adjustments necessary to present fairly our condensed consolidated financial statements. The results of operations for the three months ended December 31, 2022 are not necessarily indicative of the operating results for the full fiscal year 2023 or any future periods. The condensed consolidated financial statements include the accounts of Model N and its wholly owned subsidiaries. All intercompany transactions and balances have been eliminated upon consolidation. Use of Estimates The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make certain estimates and assumptions that affect the amounts of assets and liabilities reported, disclosures about contingent assets and liabilities and reported amounts of revenues and expenses during the reporting periods. Significant items subject to such estimates include revenue recognition, liability and equity allocation of convertible senior notes, legal contingencies, income taxes, stock-based compensation and valuation of goodwill and intangibles. These estimates and assumptions are based on management’s best estimates and judgment. Management regularly evaluates its estimates and assumptions using historical experience and other factors. However, actual results could differ significantly from these estimates. New Accounting Pronouncements Recently Adopted Accounting Guidance In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740), Simplifying the Accounting for Income Taxes, which removes certain exceptions to the general principles in Topic 740 and amends existing guidance to improve consistent application. ASU 2019-12 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2020, with early adoption permitted. The Company adopted this guidance in the first quarter of fiscal year 2022, and it did not have a material impact on the condensed consolidated financial statements. In August 2020, the FASB issued ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40), Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity, which eliminates the beneficial conversion and cash conversion accounting models for convertible instruments. It also amends the accounting for certain contracts in an entity’s own equity that are currently accounted for as derivatives because of specific settlement provisions. In addition, the new guidance modifies how particular convertible instruments and certain contracts that may be settled in cash or shares impact the diluted EPS computation. The Company adopted this ASU on October 1, 2022 on a modified retrospective basis. As a result, the Company no longer separately presents in equity an embedded conversion feature for such debt. Similarly, the discount is no longer amortized into income as interest expense over the life of the instrument. The cumulative effect of the ASU adoption was as follows (in thousands): Balance at September 30, 2022 Adjustments from Adoption of ASU 2020-06 Balance at October 1, 2022 Liabilities Long term debt $ 135,417 $ 33,720 $ 169,137 Stockholders’ Equity Additional paid-in capital 421,473 (55,227) 366,246 Accumulated deficit (284,445) 21,507 (262,938) The impact of ASU adoption on the consolidated statement of operations for the three months ended December 31, 2022 was a decrease of net interest expense by $2.7 million. This had the effect of decreasing the basic and diluted net loss per share for the three months ended December 31, 2022 by approximately $0.07. The required use of the if-converted method to calculate the impact of convertible notes would have an anti-dilutive impact. Recently Issued Accounting Pronouncements Not Yet Adopted In October 2021, the FASB issued Accounting Standards Update No. 2021-08, “Business Combinations (Topic 805), Accounting for Contract Assets and Contract Liabilities from Contracts with Customers” (“ASU 2021-08”), which requires contract assets and contract liabilities acquired in a business combination to be recognized and measured in accordance with ASC 606, Revenue from Contracts with Customers. ASU 2021-08 is effective for interim and annual periods beginning after December 15, 2022 on a prospective basis, with early adoption permitted. The Company is currently evaluating the potential impact of ASU 2021-08 to its consolidated financial statements. Significant Accounting Policies There have been no changes in the significant accounting policies from those that were disclosed in the audited consolidated financial statements for the fiscal year ended September 30, 2022 included in the Annual Report on Form 10-K.

Revenues from Contracts with Cu

Revenues from Contracts with Customers	3 Months Ended
	Dec. 31, 2022
Revenue from Contract with Customer [Abstract]
Revenues from Contracts with Customers	Revenues from Contracts with Customers Revenue Recognition The Company derives revenues primarily from subscription revenues and professional services revenues. Revenues are recorded at a net basis which exclude sales taxes that are collected from customers. Disaggregation of Revenues See Note 14, Geographic Information, for information on revenue by geography. Customer Contract Balances The following table reflects contract balances related to contracts with customers (in thousands): As of December 31, 2022 As of September 30, 2022 Accounts receivable, net $ 47,016 $ 35,095 Unbilled accounts receivable, net 19,102 14,026 Total accounts receivable, net $ 66,118 $ 49,121 Contract asset $ 9,419 $ 7,671 Deferred revenue $ 67,421 $ 62,649 Capitalized contract acquisition costs $ 12,887 $ 13,041 Accounts Receivable Accounts receivable represents the Company’s right to consideration that is unconditional, net of allowances for doubtful accounts. The allowance for doubtful accounts is based on management’s assessment of the collectability of accounts receivable amounts. Unbilled Accounts Receivable Unbilled accounts receivable consist of a receivable primarily for the revenue recognized for services performed but not yet billed. Contract Asset Contract asset represents revenue that has been recognized for satisfied performance obligations for which the Company does not have an unconditional right to consideration. Deferred Revenue Deferred revenue, which is a contract liability, consists of amounts that have been invoiced and for which the Company has the right to bill, but that have not been recognized as revenue because the related goods or services have not been transferred. The non-current portion of deferred revenue is included in other long-term liabilities in the condensed consolidated balance sheets. During the three months ended December 31, 2022 and 2021, the Company recognized revenue of $28.5 million and $25.9 million, respectively, that was included in the deferred revenue balances at the beginning of the periods. Capitalized Contract Acquisition Costs The Company capitalizes incremental costs incurred to acquire contracts with customers, primarily sales commissions, for which the associated revenue is expected to be recognized in future periods. The Company incurs these costs in connection with both initial contracts and renewals. Such costs for renewals are not considered commensurate with those for initial contracts given the substantive difference in commission rates in proportion to their respective contract values. The costs in connection with initial contracts and renewals are deferred and amortized over an expected customer life of five years and over the renewal term, respectively, which corresponds to the period of benefit to the customer. The Company determined the period of benefit by considering the Company’s history of customer relationships, length of customer contracts, technological development and obsolescence, and other factors. The current and non-current portion of capitalized contract acquisition costs are included in other current assets and other assets on the condensed consolidated balance sheets. Amortization expense is included in sales and marketing expenses on the condensed consolidated statements of operations. As of December 31, 2022, the current and non-current portions of capitalized contract acquisition costs were $4.5 million and $8.4 million, respectively. As of September 30, 2022, the current and non-current portions of capitalized contract acquisition costs were $4.4 million and $8.6 million, respectively. The Company amortized $1.2 million and $1.0 million of contract acquisition costs during the three months ended December 31, 2022 and December 31, 2021, respectively. For the three months ended December 31, 2022 and 2021, there was no impairment related to capitalized contract acquisition costs. Customer Deposits Customer deposits primarily relate to payments received from customers which could be refundable pursuant to the terms of the related arrangement. These amounts are included in accrued liabilities on the condensed consolidated balance sheets. Customer deposits were immaterial as of December 31, 2022 and September 30, 2022. Standard payment terms to customers generally range from thirty to ninety days; however, payment terms and conditions in our customer contracts may vary. In some cases, customers prepay for subscription and services in advance of the delivery; in other cases, payment is due as services are performed or in arrears following the delivery. Remaining Performance Obligations Remaining performance obligations represent non-cancelable contracted revenue that has not yet been recognized, which includes deferred revenue and amounts that will be invoiced and recognized as revenue in future periods. As of December 31, 2022, the aggregate amount of the transaction price allocated to performance obligations either unsatisfied or partially unsatisfied was $339.7 million, 43% of which we expect to recognize as revenue over the next 12 months and the remainder thereafter.

Leases

Leases	3 Months Ended
	Dec. 31, 2022
Leases [Abstract]
Leases	Leases The Company leases facilities under noncancellable operating leases with lease terms between three years and eleven years. Certain leases include options to extend or terminate the lease. The Company factored into the determination of lease payments the options that it is reasonably certain to exercise. Operating lease costs were $1.3 million and $1.5 million for the three months ended December 31, 2022, and 2021, respectively. Short-term lease costs, variable lease costs, and sublease income were immaterial for the three months ended December 31, 2022 and 2021. Cash flow information related to operating leases is as follows (in thousands): Three Months Ended December 31, 2022 Three Months Ended December 31, 2021 Cash paid for amounts included in the measurement of operating lease liabilities $ 1,182 $ 1,236 Operating lease ROU assets obtained in exchange for new operating lease liabilities — — The weighted-average remaining lease term is 3.2 years and the weighted-average discount rate is 2.7% as of December 31, 2022. Maturities of operating lease liabilities as of December 31, 2022 are as follows (in thousands): Fiscal Year Remaining fiscal 2023 $ 3,676 2024 4,652 2025 4,287 2026 2,353 2027 275 2028 and thereafter — Total operating lease payments 15,243 Less imputed interest 644 Total operating lease liabilities $ 14,599

Fair Value of Financial Instrum

Fair Value of Financial Instruments	3 Months Ended
	Dec. 31, 2022
Fair Value Disclosures [Abstract]
Fair Value of Financial Instruments	Fair Value of Financial Instruments The Company’s financial instruments consist primarily of cash and cash equivalents, funds held for customers, accounts receivable, accounts payable, customer funds payable, debt and certain accrued liabilities. The Company regularly reviews its financial instruments portfolio to identify and evaluate such instruments that have indications of possible impairment. The Company estimates the fair value of its financial instruments when there is no readily available market data, which involves some level of management estimation and judgment and may not necessarily represent the amounts that could be realized in a current or future sale of these assets. The table below sets forth the Company’s marketable securities which are measured at fair value on a recurring basis by level within the fair value hierarchy (in thousands): Reported as: Amortized Cost Unrealized Gains Unrealized Losses Fair Value Cash and Cash Equivalents As of December 31, 2022 Level 1: Money market funds $ 45,565 $ — $ — $ 45,565 $ 45,565 US Treasury securities 109,485 26 — 109,511 109,511 Total $ 155,050 $ 26 $ — $ 155,076 $ 155,076 As of September 30, 2022 Level 1: Money market funds $ 61,956 $ — $ — $ 61,956 $ 61,956 US Treasury securities 89,679 11 (6) 89,684 89,684 Total $ 151,635 $ 11 $ (6) $ 151,640 $ 151,640 The Company’s financial instruments not measured at fair value on a recurring basis include cash, funds held for customers, accounts receivable, accounts payable, customer funds payable, and certain accrued liabilities. These financial instruments are reflected in the financial statements at cost and approximate their fair value due to their short-term nature. See Note 7 for the fair value measurement of the Company’s derivative contracts and Note 8 for the fair value measurement of the Company’s convertible senior notes.

Goodwill, and Intangible Assets

Goodwill, and Intangible Assets	3 Months Ended
	Dec. 31, 2022
Goodwill and Intangible Assets Disclosure [Abstract]
Goodwill, and Intangible Assets	Goodwill, and Intangible Assets Goodwill The following table summarizes the changes in the carrying amount of goodwill (in thousands): Balance at September 30, 2022 $ 65,665 Additions — Balance at December 31, 2022 $ 65,665 Intangible Assets Intangible assets consisted of the following (in thousands): Estimated As of December 31, 2022 Useful Life Gross Carrying Accumulated Net Carrying Intangible Assets: Customer relationships 3-15 $ 52,109 $ (24,832) $ 27,277 Developed technology 5-6 22,333 (15,500) 6,833 Non-compete agreements 5 1,600 (640) 960 Trade name 3 850 (566) 284 Total $ 76,892 $ (41,538) $ 35,354 Estimated As of September 30, 2022 Useful Life Gross Carrying Accumulated Net Carrying Intangible Assets: Customer relationships 3-15 $ 52,109 $ (23,684) $ 28,425 Developed technology 5-6 22,333 (14,791) 7,543 Non-compete agreements 5 1,600 (560) 1,040 Trade name 3 850 (496) 354 Total $ 76,892 $ (39,531) $ 37,362 The Company recorded amortization expense related to acquired intangible assets of $2.0 million for both the three months ended December 31, 2022 and December 31, 2021. Estimated future amortization expense for the intangible assets as of December 31, 2022 is as follows (in thousands): Fiscal Year Remaining fiscal 2023 $ 5,178 2024 6,691 2025 6,620 2026 6,069 2027 2,266 2028 and thereafter 8,530 Total future amortization $ 35,354

Cash, Cash Equivalents, and Fun

Cash, Cash Equivalents, and Funds Held for Customers	3 Months Ended
	Dec. 31, 2022
Cash and Cash Equivalents [Abstract]
Cash, Cash Equivalents, and Funds Held for Customers	Cash, Cash Equivalents, and Funds Held for Customers The Company has contractual obligations to remit funds to various third parties on behalf of customers to which the Company provides payment processing services. Funds received from these customers represent cash and cash equivalents and are reflected in the “Funds held for customers” line item on the condensed consolidated balance sheets. The table below reconciles the cash and cash equivalents and funds held for customers as reported on the condensed consolidated balance sheets to the cash and cash equivalents on the condensed consolidated statements of cash flows (in thousands): As of December 31, 2022 As of September 30, 2022 Cash and cash equivalents $ 175,194 $ 193,524 Funds held for customers 134 603 Total cash and cash equivalents $ 175,328 $ 194,127

Derivative Instruments and Hedg

Derivative Instruments and Hedging	3 Months Ended
	Dec. 31, 2022
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Derivative Instruments and Hedging	Derivative Instruments and Hedging The Company uses foreign currency forward contracts to hedge a portion of the forecasted foreign currency-denominated expenses incurred in the normal course of business. These contracts are designated as cash flows hedges. These hedging contracts reduce, but do not entirely eliminate, the impact of adverse foreign exchange rate movements. The Company does not use any of the derivative instruments for trading or speculative purposes. These contracts have maturities of 12 months or less. The Company records changes in the fair value of cash flow hedges in accumulated other comprehensive loss in the condensed consolidated balance sheets, until the forecasted transaction occurs, at which point, the related gain or loss on the cash flow hedge is reclassified to the financial statement line item to which the derivative relates. The amounts reclassified to expenses related to the hedged transactions were immaterial for the periods presented. The fair value of the outstanding non-deliverable foreign currency forward contracts was measured using Level 2 fair value inputs and was immaterial as of September 30, 2022. The Company had no outstanding non-deliverable foreign currency forward contracts as of December 31, 2022. Notional Amounts of Derivative Contracts

Convertible Senior Notes

Convertible Senior Notes	3 Months Ended
	Dec. 31, 2022
Debt Disclosure [Abstract]
Convertible Senior Notes	Convertible Senior Notes In May 2020, the Company issued $172.5 million aggregate principal amount of 2.625% convertible senior notes (“Notes”) in a private placement, including $22.5 million which represents the exercise in full of the initial purchasers’ option to purchase additional notes. The net proceeds from the issuance of the Notes was $166.4 million, net of initial purchasers’ discounts and debt issuance costs of $6.1 million. The Company used $40.0 million of the net proceeds to repay in full the debt outstanding under, and terminated the Credit Agreement dated May 4, 2018, as amended, by and among the Company, Wells Fargo, as administrative agent, and the lenders party thereto. The Notes are senior, unsecured obligations of the Company and bear an interest rate of 2.625% per year payable semi-annually in arrears on June 1 and December 1 of each year, beginning on December 1, 2020. The Notes mature on June 1, 2025 unless repurchased, redeemed or converted in accordance with their terms prior to such date. The Notes are convertible into cash, shares of the Company’s common stock or a combination thereof, at the Company’s election, at an initial conversion rate of 30.0044 shares of common stock per $1,000 principal amount of the Notes, which is equal to an initial conversion price of approximately $33.33 per share of common stock subject to adjustment, with a maximum conversion rate of 38.2555. The Company intends to settle the principal amount of the Notes with cash. Prior to the close of business on the scheduled trading day immediately preceding March 1, 2025, holders of the Notes may convert all or a portion of their Notes in multiples of $1,000 principal amount, only under the following circumstances: • during any calendar quarter commencing after the calendar quarter ending on September 30, 2020 (and only during such calendar quarter), if the last reported sale price of the Company’s common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day; • during the five five • if the Company calls any or all of the notes for redemption, at any time prior to the close of business on the scheduled trading day immediately preceding the redemption date; or • upon the occurrence of specified corporate events. On or after March 1, 2025 and prior to the close of business on the second scheduled trading day immediately preceding the maturity date, holders of the Notes may convert all or a portion of their Notes in multiples of $1,000 principal amount regardless of the foregoing conditions. Holders of the Notes who convert their Notes in connection with a make-whole fundamental change (as defined in the Indenture) or in connection with any optional redemption are, under certain circumstances, entitled to an increase in the conversion rate. Additionally, in the event of a fundamental change (as defined in the Indenture), holders of the Notes may require the Company to repurchase all or a portion of their Notes at a price equal to 100% of the principal amount of Notes, plus any accrued and unpaid interest to, but excluding, the repurchase date. The Company may not redeem the Notes prior to June 6, 2023. The Company may redeem for cash all or part of the Notes, at its option, on or after June 6, 2023 and on or before the 41st scheduled trading day immediately before the maturity date, at a redemption price equal to 100% of the principal amount thereof, plus accrued and unpaid interest if the last reported sale price of the Company’s common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive), including the trading day immediately preceding the date on which the Company provides notice of redemption, during any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which the Company provides notice of redemption. No sinking fund is provided for the Notes. During the three months ended December 31, 2022, the conditions allowing holders of the Notes to convert were not met. The Notes were classified as long-term debt on the condensed consolidated balance sheets as of December 31, 2022. In initial accounting for the issuance of the Notes prior to the adoption of ASU 2020-06 on October 1, 2022, the Company separated the Notes into liability and equity components. The carrying amount of the liability component of $115.3 million was calculated by measuring the fair value of a similar debt instrument that does not have an associated convertible feature. The carrying amount of the equity component representing the conversion option was $57.2 million and was determined by deducting the fair value of the liability component from the principal amount of the Notes. The excess of the principal amount of the Notes over the carrying amount of the liability component represent a debt discount that was amortized to interest expense at an effective interest rate over the contractual terms of the Notes. The equity component was recorded in additional paid-in capital and is not remeasured as long as it continues to meet the conditions for equity classification. In initial accounting for the issuance costs related to the Notes prior to the adoption of ASU 2020-06 on October 1, 2022, the Company allocated the total amount incurred to the liability and equity components of the Notes based on the proportion of the proceeds allocated to the debt and equity components. Issuance costs attributable to the liability component were $4.1 million and are amortized to interest expense using the effective interest method over the contractual terms of the Notes. Issuance costs attributable to the equity component of $2.0 million were netted with the equity component in stockholders’ equity. As a result of the adoption of ASU 2020-06 on October 1, 2022, the Company no longer separately presents in equity an embedded conversion feature for such debt. Similarly, the debt discount, which was equal to the carrying value of the embedded conversion feature upon issuance, is no longer amortized into income as interest expense over the life of the instrument. For the impact of adoption see Note 1 to Condensed Consolidated Financial Statements. The net carrying amounts of the liability and equity components for the Notes were as follows (in thousands): As of December 31, 2022 As of September 30, 2022 Liability component: Principal amount $ 172,500 $ 172,500 Unamortized discount — (34,354) Unamortized issuance costs (3,061) (2,729) Net carrying amount $ 169,439 $ 135,417 Equity component, net of issuance costs $ — $ 55,227 The following table sets forth the interest expense recognized related to the Notes (in thousands): Three Months Ended December 31, 2022 2021 Coupon interest expense $ 1,132 $ 1,132 Amortization of debt discount — 2,504 Amortization of debt issuance costs 302 152 Total interest expense related to the Notes $ 1,434 $ 3,788 Effective interest rate of the liability component 3.40 % 12.32 % The unamortized debt issuance costs will be amortized over 29 months as of December 31, 2022. As of December 31, 2022, the total estimated fair value of the Notes was approximately $234.2 million. The fair value was determined based on the closing trading price per $100 of the Notes as of the last day of trading for the period. The fair value of the Notes is primarily affected by the trading price of the Company’s common stock and market interest rates. The fair value of the Notes is considered a Level 2 measurement as they are not actively traded.

Stockholders' Equity

Stockholders' Equity	3 Months Ended
	Dec. 31, 2022
Equity [Abstract]
Stockholders' Equity	Stockholders’ Equity The following tables present the changes in the components of stockholders’ equity (in thousands): Three Months Ended December 31, 2022 Common Stock Additional Accumulated Accumulated Deficit Total Shares Amount Balance at September 30, 2022 37,358 $ 6 $ 421,473 $ (2,413) $ (284,445) $ 134,621 Cumulative effect of ASU 2020-06 adoption (55,227) 21,507 (33,720) Balance at October 1, 2022 37,358 6 366,246 (2,413) (262,938) 100,901 Issuance of common stock upon exercise of stock options 2 — 27 — — 27 Issuance of common stock upon release of restricted stock units 374 — — — — — Stock-based compensation — — 15,460 — — 15,460 Other comprehensive income — — — 199 — 199 Net loss — — — — (4,050) (4,050) Balance at December 31, 2022 37,734 $ 6 $ 381,733 $ (2,214) $ (266,988) $ 112,537 Three Months Ended December 31, 2021 Common Stock Additional Accumulated Accumulated Deficit Total Shares Amount Balance at September 30, 2021 $ 36,059 $ 5 $ 380,528 $ (1,205) $ (255,810) $ 123,518 Issuance of common stock upon exercise of stock options 8 — 72 — — 72 Issuance of common stock upon release of restricted stock units 366 — — — — — Stock-based compensation — — 12,678 — — 12,678 Other comprehensive loss — — — (13) — (13) Net loss — — — — (6,266) (6,266) Balance at December 31, 2021 36,433 $ 5 $ 393,278 $ (1,218) $ (262,076) $ 129,989 For the three months ended December 31, 2022, additional paid-in capital included $5.1 million, related to restricted stock unit (“RSU”) grants for the portion of the bonus recorded as stock-based compensation for the year ended September 30, 2022. For the three months ended December 31, 2021, additional paid-in capital included $5.4 million, related to RSU grants for the portion of the bonus recorded as stock-based compensation for the year ended September 30, 2021.

Stock-based Compensation

Stock-based Compensation	3 Months Ended
	Dec. 31, 2022
Share-Based Payment Arrangement [Abstract]
Stock-based Compensation	Stock-based Compensation As of December 31, 2022, the Company had approximately 1.0 million shares available for future stock awards under its equity plans and any additional releases resulting from an over-achievement relating to performance-based restricted stock units. The following table summarizes our RSU activity which includes performance-based RSUs under all equity plans for the three months ended December 31, 2022: Restricted Weighted Balance at September 30, 2022 2,055 $ 33.08 Granted 1,211 38.36 Released (374) 31.49 Forfeited (29) 30.98 Balance at December 31, 2022 2,863 $ 35.54 Stock-based compensation recorded in the condensed consolidated statements of operations is as follows (in thousands): Three Months Ended December 31, 2022 2021 Cost of revenues Subscription $ 1,337 $ 858 Professional services 1,140 621 Total stock-based compensation in cost of revenues 2,477 1,479 Operating expenses Research and development 1,821 1,281 Sales and marketing 2,388 1,620 General and administrative 3,718 2,606 Total stock-based compensation in operating expenses 7,927 5,507 Total stock-based compensation $ 10,404 $ 6,986

Income Taxes

Income Taxes	3 Months Ended
	Dec. 31, 2022
Income Tax Disclosure [Abstract]
Income Taxes	Income Taxes The Company recorded income tax provisions of $0.4 million representing effective income tax rates of (11.9)% for the three months ended December 31, 2022, and $0.4 million representing effective income tax rates of (6.3)% for the three months ended December 31, 2021. The income tax provision for the three months ended December 31, 2022 and 2021 was primarily related to foreign taxes on the Company’s profitable foreign operations, foreign withholding taxes on dividends, and deferred taxes on goodwill resulting from the Acquisition. The Company elected to partially reinvest foreign earnings in certain foreign jurisdictions and expects to repatriate future foreign earnings in certain foreign jurisdictions over time. As a result, the Company will record a deferred tax liability for the additional non-U.S. taxes that are expected to be incurred related to the repatriation of these earnings. The Company elected to record global intangible low-taxed income (“GILTI”) as a period cost. The Company realized no benefit for current period losses due to maintaining a full valuation allowance against the U.S. net deferred tax assets.

Net Loss per Share

Net Loss per Share	3 Months Ended
	Dec. 31, 2022
Earnings Per Share [Abstract]
Net Loss per Share	Net Loss per Share The following table sets forth the computation of the basic and diluted net loss per share attributable to common stockholders during the periods presented (in thousands, except per share data): Three Months Ended December 31, 2022 2021 Numerator Basic and diluted Net loss attributable to common stockholders $ (4,050) $ (6,266) Denominator Basic and diluted Weighted average shares used in computing net loss per share attributable to common stockholders 37,527 36,223 Net loss per share attributable to common stockholders: Basic and diluted $ (0.11) $ (0.17) Potentially dilutive securities that were not included in the calculation of diluted net loss per share because their effect would have been an anti-dilutive are as follows (in thousands): As of December 31, 2022 2021 Stock options 2 17 Performance-based RSUs and RSUs 2,863 2,512 Shares issuable pursuant to the employee stock purchase plan 97 90 Convertible senior notes 5,176 — Beginning October 1, 2022, net loss per share includes the impact of adoption of accounting pronouncement (ASU 2020-06). Under the new standard, the Company is required to reflect the dilutive effect of the Convertible Notes by application of the if-converted method. Prior to October 1, 2022, the Company used the treasury stock method for calculating any potential dilutive effect of the conversion spread on diluted net income per share, if applicable. The conversion spread had a dilutive impact on diluted net income per share of common stock when the average market price of the Company’s common stock for a given period exceeds the conversion price of $33.33 per share for the Notes.

Litigation and Contingencies

Litigation and Contingencies	3 Months Ended
	Dec. 31, 2022
Commitments and Contingencies Disclosure [Abstract]
Litigation and Contingencies	Litigation and Contingencies Legal Proceedings The Company is not currently a party to any pending material legal proceedings. From time to time, the Company may become involved in legal proceedings arising in the ordinary course of business. Regardless of outcome, litigation can have an adverse impact on the Company due to defense and settlement costs, diversion of management resources, negative publicity and reputational harm and other factors.

Geographic Information

Geographic Information	3 Months Ended
	Dec. 31, 2022
Segment Reporting [Abstract]
Geographic Information	Geographic InformationThe Company has one operating segment with one business activity — developing and monetizing revenue management solutions. Revenues The Company disaggregates the revenues by geographic regions based on the bill to location of its customers. Revenues from customers outside of the United States were 5% of total revenues for the three months ended December 31, 2022, and 6% of total revenues for the three months ended December 31, 2021. Long-Lived Assets The following table sets forth the Company’s property and equipment, net, by geographic region (in thousands): As of December 31, 2022 As of September 30, 2022 United States $ 944 $ 1,113 India 622 725 Total property and equipment, net $ 1,566 $ 1,838

The Company and Significant A_2

The Company and Significant Accounting Policies and Estimates (Policies)	3 Months Ended
	Dec. 31, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis for Presentation	Basis for Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Certain information and note disclosures normally included in the financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. The unaudited condensed consolidated balance sheet as of September 30, 2022 has been derived from the audited financial statements which are included in our Annual Report on Form 10-K for the fiscal year ended September 30, 2022 (“the Annual Report”) on file with the SEC. The unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the Annual Report. In the opinion of management, the unaudited interim consolidated financial statements include all the normal recurring adjustments necessary to present fairly our condensed consolidated financial statements. The results of operations for the three months ended December 31, 2022 are not necessarily indicative of the operating results for the full fiscal year 2023 or any future periods. The condensed consolidated financial statements include the accounts of Model N and its wholly owned subsidiaries. All intercompany transactions and balances have been eliminated upon consolidation.
Use of Estimates	Use of Estimates The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make certain estimates and assumptions that affect the amounts of assets and liabilities reported, disclosures about contingent assets and liabilities and reported amounts of revenues and expenses during the reporting periods. Significant items subject to such estimates include revenue recognition, liability and equity allocation of convertible senior notes, legal contingencies, income taxes, stock-based compensation and valuation of goodwill and intangibles. These estimates and assumptions are based on management’s best estimates and judgment. Management regularly evaluates its estimates and assumptions using historical experience and other factors. However, actual results could differ significantly from these estimates.
New Accounting Pronouncements	New Accounting Pronouncements Recently Adopted Accounting Guidance In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740), Simplifying the Accounting for Income Taxes, which removes certain exceptions to the general principles in Topic 740 and amends existing guidance to improve consistent application. ASU 2019-12 is effective for fiscal years, and interim periods within those years, beginning after The impact of ASU adoption on the consolidated statement of operations for the three months ended December 31, 2022 was a decrease of net interest expense by $2.7 million. This had the effect of decreasing the basic and diluted net loss per share for the three months ended December 31, 2022 by approximately $0.07. The required use of the if-converted method to calculate the impact of convertible notes would have an anti-dilutive impact. Recently Issued Accounting Pronouncements Not Yet Adopted In October 2021, the FASB issued Accounting Standards Update No. 2021-08, “Business Combinations (Topic 805), Accounting for Contract Assets and Contract Liabilities from Contracts with Customers” (“ASU 2021-08”), which requires contract assets and contract liabilities acquired in a business combination to be recognized and measured in accordance with ASC 606, Revenue from Contracts with Customers. ASU 2021-08 is effective for interim and annual periods beginning after December 15, 2022 on a prospective basis, with early adoption permitted. The Company is currently evaluating the potential impact of ASU 2021-08 to its consolidated financial statements. Significant Accounting Policies
Revenues from Contract with Customer	Accounts Receivable Accounts receivable represents the Company’s right to consideration that is unconditional, net of allowances for doubtful accounts. The allowance for doubtful accounts is based on management’s assessment of the collectability of accounts receivable amounts. Unbilled Accounts Receivable Unbilled accounts receivable consist of a receivable primarily for the revenue recognized for services performed but not yet billed. Contract Asset Contract asset represents revenue that has been recognized for satisfied performance obligations for which the Company does not have an unconditional right to consideration. Deferred Revenue Deferred revenue, which is a contract liability, consists of amounts that have been invoiced and for which the Company has the right to bill, but that have not been recognized as revenue because the related goods or services have not been transferred. Capitalized Contract Acquisition Costs The Company capitalizes incremental costs incurred to acquire contracts with customers, primarily sales commissions, for which the associated revenue is expected to be recognized in future periods. The Company incurs these costs in connection with both initial contracts and renewals. Such costs for renewals are not considered commensurate with those for initial contracts given the substantive difference in commission rates in proportion to their respective contract values. The costs in connection with initial contracts and renewals are deferred and amortized over an expected customer life of five years and over the renewal term, respectively, which corresponds to the period of benefit to the customer. The Company determined the period of benefit by considering the Company’s history of customer relationships, length of customer contracts, technological development and obsolescence, and other factors. The current and non-current portion of capitalized contract acquisition costs are included in other current assets and other assets on the condensed consolidated balance sheets. Amortization expense is included in sales and marketing expenses on the condensed consolidated statements of operations. Customer Deposits Customer deposits primarily relate to payments received from customers which could be refundable pursuant to the terms of the related arrangement. These amounts are included in accrued liabilities on the condensed consolidated balance sheets. Customer deposits were immaterial as of December 31, 2022 and September 30, 2022. Standard payment terms to customers generally range from thirty to ninety days; however, payment terms and conditions in our customer contracts may vary. In some cases, customers prepay for subscription and services in advance of the delivery; in other cases, payment is due as services are performed or in arrears following the delivery. Remaining Performance Obligations

The Company and Significant A_3

The Company and Significant Accounting Policies and Estimates (Tables)	3 Months Ended
	Dec. 31, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Schedule of Accounting Standards Update and Change in Accounting Principle	The cumulative effect of the ASU adoption was as follows (in thousands): Balance at September 30, 2022 Adjustments from Adoption of ASU 2020-06 Balance at October 1, 2022 Liabilities Long term debt $ 135,417 $ 33,720 $ 169,137 Stockholders’ Equity Additional paid-in capital 421,473 (55,227) 366,246 Accumulated deficit (284,445) 21,507 (262,938)

Revenues from Contracts with _2

Revenues from Contracts with Customers (Tables)	3 Months Ended
	Dec. 31, 2022
Revenue from Contract with Customer [Abstract]
Schedule of customer contract balances	The following table reflects contract balances related to contracts with customers (in thousands): As of December 31, 2022 As of September 30, 2022 Accounts receivable, net $ 47,016 $ 35,095 Unbilled accounts receivable, net 19,102 14,026 Total accounts receivable, net $ 66,118 $ 49,121 Contract asset $ 9,419 $ 7,671 Deferred revenue $ 67,421 $ 62,649 Capitalized contract acquisition costs $ 12,887 $ 13,041

Leases (Tables)

Leases (Tables)	3 Months Ended
	Dec. 31, 2022
Leases [Abstract]
Schedule of operating lease cost and cash flow information	Cash flow information related to operating leases is as follows (in thousands): Three Months Ended December 31, 2022 Three Months Ended December 31, 2021 Cash paid for amounts included in the measurement of operating lease liabilities $ 1,182 $ 1,236 Operating lease ROU assets obtained in exchange for new operating lease liabilities — —
Schedule of maturities of operating lease liabilities	Maturities of operating lease liabilities as of December 31, 2022 are as follows (in thousands): Fiscal Year Remaining fiscal 2023 $ 3,676 2024 4,652 2025 4,287 2026 2,353 2027 275 2028 and thereafter — Total operating lease payments 15,243 Less imputed interest 644 Total operating lease liabilities $ 14,599

Fair Value of Financial Instr_2

Fair Value of Financial Instruments (Tables)	3 Months Ended
	Dec. 31, 2022
Fair Value Disclosures [Abstract]
Schedule of fair value measured on recurring basis	The table below sets forth the Company’s marketable securities which are measured at fair value on a recurring basis by level within the fair value hierarchy (in thousands): Reported as: Amortized Cost Unrealized Gains Unrealized Losses Fair Value Cash and Cash Equivalents As of December 31, 2022 Level 1: Money market funds $ 45,565 $ — $ — $ 45,565 $ 45,565 US Treasury securities 109,485 26 — 109,511 109,511 Total $ 155,050 $ 26 $ — $ 155,076 $ 155,076 As of September 30, 2022 Level 1: Money market funds $ 61,956 $ — $ — $ 61,956 $ 61,956 US Treasury securities 89,679 11 (6) 89,684 89,684 Total $ 151,635 $ 11 $ (6) $ 151,640 $ 151,640

Goodwill, and Intangible Asse_2

Goodwill, and Intangible Assets (Tables)	3 Months Ended
	Dec. 31, 2022
Goodwill and Intangible Assets Disclosure [Abstract]
Schedule of goodwill	The following table summarizes the changes in the carrying amount of goodwill (in thousands): Balance at September 30, 2022 $ 65,665 Additions — Balance at December 31, 2022 $ 65,665
Schedule of intangible assets	Intangible assets consisted of the following (in thousands): Estimated As of December 31, 2022 Useful Life Gross Carrying Accumulated Net Carrying Intangible Assets: Customer relationships 3-15 $ 52,109 $ (24,832) $ 27,277 Developed technology 5-6 22,333 (15,500) 6,833 Non-compete agreements 5 1,600 (640) 960 Trade name 3 850 (566) 284 Total $ 76,892 $ (41,538) $ 35,354 Estimated As of September 30, 2022 Useful Life Gross Carrying Accumulated Net Carrying Intangible Assets: Customer relationships 3-15 $ 52,109 $ (23,684) $ 28,425 Developed technology 5-6 22,333 (14,791) 7,543 Non-compete agreements 5 1,600 (560) 1,040 Trade name 3 850 (496) 354 Total $ 76,892 $ (39,531) $ 37,362
Schedule of estimated future amortization expenses	Estimated future amortization expense for the intangible assets as of December 31, 2022 is as follows (in thousands): Fiscal Year Remaining fiscal 2023 $ 5,178 2024 6,691 2025 6,620 2026 6,069 2027 2,266 2028 and thereafter 8,530 Total future amortization $ 35,354

Cash, Cash Equivalents, and F_2

Cash, Cash Equivalents, and Funds Held for Customers (Tables)	3 Months Ended
	Dec. 31, 2022
Cash and Cash Equivalents [Abstract]
Schedule of restrictions on cash and cash equivalents	The table below reconciles the cash and cash equivalents and funds held for customers as reported on the condensed consolidated balance sheets to the cash and cash equivalents on the condensed consolidated statements of cash flows (in thousands): As of December 31, 2022 As of September 30, 2022 Cash and cash equivalents $ 175,194 $ 193,524 Funds held for customers 134 603 Total cash and cash equivalents $ 175,328 $ 194,127

Convertible Senior Notes (Table

Convertible Senior Notes (Tables)	3 Months Ended
	Dec. 31, 2022
Debt Disclosure [Abstract]
Schedule of debt	The net carrying amounts of the liability and equity components for the Notes were as follows (in thousands): As of December 31, 2022 As of September 30, 2022 Liability component: Principal amount $ 172,500 $ 172,500 Unamortized discount — (34,354) Unamortized issuance costs (3,061) (2,729) Net carrying amount $ 169,439 $ 135,417 Equity component, net of issuance costs $ — $ 55,227 The following table sets forth the interest expense recognized related to the Notes (in thousands): Three Months Ended December 31, 2022 2021 Coupon interest expense $ 1,132 $ 1,132 Amortization of debt discount — 2,504 Amortization of debt issuance costs 302 152 Total interest expense related to the Notes $ 1,434 $ 3,788 Effective interest rate of the liability component 3.40 % 12.32 %

Stockholders' Equity (Tables)

Stockholders' Equity (Tables)	3 Months Ended
	Dec. 31, 2022
Equity [Abstract]
Schedule of stockholder's equity	The following tables present the changes in the components of stockholders’ equity (in thousands): Three Months Ended December 31, 2022 Common Stock Additional Accumulated Accumulated Deficit Total Shares Amount Balance at September 30, 2022 37,358 $ 6 $ 421,473 $ (2,413) $ (284,445) $ 134,621 Cumulative effect of ASU 2020-06 adoption (55,227) 21,507 (33,720) Balance at October 1, 2022 37,358 6 366,246 (2,413) (262,938) 100,901 Issuance of common stock upon exercise of stock options 2 — 27 — — 27 Issuance of common stock upon release of restricted stock units 374 — — — — — Stock-based compensation — — 15,460 — — 15,460 Other comprehensive income — — — 199 — 199 Net loss — — — — (4,050) (4,050) Balance at December 31, 2022 37,734 $ 6 $ 381,733 $ (2,214) $ (266,988) $ 112,537 Three Months Ended December 31, 2021 Common Stock Additional Accumulated Accumulated Deficit Total Shares Amount Balance at September 30, 2021 $ 36,059 $ 5 $ 380,528 $ (1,205) $ (255,810) $ 123,518 Issuance of common stock upon exercise of stock options 8 — 72 — — 72 Issuance of common stock upon release of restricted stock units 366 — — — — — Stock-based compensation — — 12,678 — — 12,678 Other comprehensive loss — — — (13) — (13) Net loss — — — — (6,266) (6,266) Balance at December 31, 2021 36,433 $ 5 $ 393,278 $ (1,218) $ (262,076) $ 129,989

Stock-based Compensation (Table

Stock-based Compensation (Tables)	3 Months Ended
	Dec. 31, 2022
Share-Based Payment Arrangement [Abstract]
Schedule of restricted stock unit activity (including performance based restricted stock units) under all equity award plans	The following table summarizes our RSU activity which includes performance-based RSUs under all equity plans for the three months ended December 31, 2022: Restricted Weighted Balance at September 30, 2022 2,055 $ 33.08 Granted 1,211 38.36 Released (374) 31.49 Forfeited (29) 30.98 Balance at December 31, 2022 2,863 $ 35.54
Schedule of stock-based compensation	Stock-based compensation recorded in the condensed consolidated statements of operations is as follows (in thousands): Three Months Ended December 31, 2022 2021 Cost of revenues Subscription $ 1,337 $ 858 Professional services 1,140 621 Total stock-based compensation in cost of revenues 2,477 1,479 Operating expenses Research and development 1,821 1,281 Sales and marketing 2,388 1,620 General and administrative 3,718 2,606 Total stock-based compensation in operating expenses 7,927 5,507 Total stock-based compensation $ 10,404 $ 6,986

Net Loss per Share (Tables)

Net Loss per Share (Tables)	3 Months Ended
	Dec. 31, 2022
Earnings Per Share [Abstract]
Computation of basic and diluted net loss per share	The following table sets forth the computation of the basic and diluted net loss per share attributable to common stockholders during the periods presented (in thousands, except per share data): Three Months Ended December 31, 2022 2021 Numerator Basic and diluted Net loss attributable to common stockholders $ (4,050) $ (6,266) Denominator Basic and diluted Weighted average shares used in computing net loss per share attributable to common stockholders 37,527 36,223 Net loss per share attributable to common stockholders: Basic and diluted $ (0.11) $ (0.17)
Schedule of weighted average shares of common stock equivalents excluded from computation of diluted net loss per share attributable to common stockholders	Potentially dilutive securities that were not included in the calculation of diluted net loss per share because their effect would have been an anti-dilutive are as follows (in thousands): As of December 31, 2022 2021 Stock options 2 17 Performance-based RSUs and RSUs 2,863 2,512 Shares issuable pursuant to the employee stock purchase plan 97 90 Convertible senior notes 5,176 —

Geographic Information (Tables)

Geographic Information (Tables)	3 Months Ended
	Dec. 31, 2022
Segment Reporting [Abstract]
Schedule of company's property and equipment, net by geographic region	The following table sets forth the Company’s property and equipment, net, by geographic region (in thousands): As of December 31, 2022 As of September 30, 2022 United States $ 944 $ 1,113 India 622 725 Total property and equipment, net $ 1,566 $ 1,838

The Company and Significant A_4

The Company and Significant Accounting Policies and Estimates (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Oct. 01, 2022	Sep. 30, 2022
Current liabilities
Long term debt	$ 169,439	$ 169,137	$ 135,417
Stockholders’ equity
Additional paid-in capital	381,733	366,246	421,473
Accumulated deficit	$ (266,988)	$ (262,938)	(284,445)
Cumulative Effect, Period of Adoption, Adjustment
Current liabilities
Long term debt			33,720
Stockholders’ equity
Additional paid-in capital			(55,227)
Accumulated deficit			$ 21,507

The Company and Significant A_5

The Company and Significant Accounting Policies and Estimates - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Company and Significant Accounting Policies and Estimates
Interest expense, net	$ (134)	$ (3,778)
Earnings per share, basic (usd per share)	$ (0.11)	$ (0.17)
Earnings per share, diluted (usd per share)	$ (0.11)	$ (0.17)
Cumulative Effect, Period of Adoption, Adjustment
Company and Significant Accounting Policies and Estimates
Interest expense, net	$ (2,700)
Earnings per share, basic (usd per share)	$ (0.07)
Earnings per share, diluted (usd per share)	$ (0.07)

Revenues from Contracts with _3

Revenues from Contracts with Customers - Customer Contract Balances (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Sep. 30, 2022
Revenue from Contract with Customer [Abstract]
Accounts receivable, net	$ 47,016	$ 35,095
Unbilled accounts receivable, net	19,102	14,026
Total accounts receivable, net	66,118	49,121
Contract asset	9,419	7,671
Deferred revenue	67,421	62,649
Capitalized contract acquisition costs	$ 12,887	$ 13,041

Revenues from Contracts with _4

Revenues from Contracts with Customers - Narrative (Details) - USD ($)	3 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Sep. 30, 2022
Revenue from Contract with Customer [Abstract]
Revenue recognized that was included in deferred revenue at beginning of period	$ 28,500,000	$ 25,900,000
Amortized over expected customer life (in years)	5 years
Capitalized contract acquisition costs, current portion	$ 4,500,000		$ 4,400,000
Capitalized contract acquisition costs, non-current portion	8,400,000		$ 8,600,000
Amortization of capitalized contract acquisition costs	1,196,000	982,000
Impairment loss related to contract balances	$ 0	$ 0

Revenues from Contracts with _5

Revenues from Contracts with Customers - Performance Obligation (Details) - Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2023-01-01 $ in Millions	Dec. 31, 2022 USD ($)
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction
Performance obligations not satisfied or partially satisfied	$ 339.7
Remaining performance obligation, percentage	43%
Remaining performance obligation, expected timing of satisfaction (in months)	12 months

Leases - Narrative (Details)

Leases - Narrative (Details) - USD ($) $ in Millions	3 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Lessee, Lease, Description
Operating lease cost for remaining term	$ 1.3	$ 1.5
Weighted average remaining lease term (in years)	3 years 2 months 12 days
Weighted average discount rate percent	2.70%
Minimum
Lessee, Lease, Description
Noncancelable operating leases term (in years)	3 years
Maximum
Lessee, Lease, Description
Noncancelable operating leases term (in years)	11 years

Leases - Cash Flow Information

Leases - Cash Flow Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Leases [Abstract]
Cash paid for amounts included in the measurement of operating lease liabilities	$ 1,182	$ 1,236
Operating lease ROU assets obtained in exchange for new operating lease liabilities	$ 0	$ 0

Leases - Maturities of Operatin

Leases - Maturities of Operating Lease Liabilities (Details) $ in Thousands	Dec. 31, 2022 USD ($)
Fiscal Year
Remaining fiscal 2023	$ 3,676
2024	4,652
2025	4,287
2026	2,353
2027	275
2028 and thereafter	0
Total operating lease payments	15,243
Less imputed interest	644
Total operating lease liabilities	$ 14,599

Fair Value of Financial Instr_3

Fair Value of Financial Instruments - Schedule of Fair Value Measured on Recurring Basis (Details) - Level 1 - Fair Value Measurement Recurring - USD ($) $ in Thousands	Dec. 31, 2022	Sep. 30, 2022
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Amortized Cost	$ 155,050	$ 151,635
Unrealized Gains	26	11
Unrealized Losses	0	(6)
Fair Value	155,076	151,640
Cash and Cash Equivalents	155,076	151,640
Money market funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Amortized Cost	45,565	61,956
Unrealized Gains	0	0
Unrealized Losses	0	0
Fair Value	45,565	61,956
Cash and Cash Equivalents	45,565	61,956
US Treasury securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Amortized Cost	109,485	89,679
Unrealized Gains	26	11
Unrealized Losses	0	(6)
Fair Value	109,511	89,684
Cash and Cash Equivalents	$ 109,511	$ 89,684

Goodwill, and Intangible Asse_3

Goodwill, and Intangible Assets - Schedule of Goodwill (Details) $ in Thousands	3 Months Ended
	Dec. 31, 2022 USD ($)
Goodwill
Beginning balance	$ 65,665
Additions	0
Ending balance	$ 65,665

Goodwill, and Intangible Asse_4

Goodwill, and Intangible Assets - Schedule of Intangible Assets (Details) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Dec. 31, 2022	Sep. 30, 2022
Acquired Finite-Lived Intangible Assets
Gross Carrying Amount	$ 76,892	$ 76,892
Accumulated Amortization	(41,538)	(39,531)
Net Carrying Amount	35,354	37,362
Customer relationships
Acquired Finite-Lived Intangible Assets
Gross Carrying Amount	52,109	52,109
Accumulated Amortization	(24,832)	(23,684)
Net Carrying Amount	$ 27,277	$ 28,425
Customer relationships | Minimum
Acquired Finite-Lived Intangible Assets
Estimated Useful Life (in Years)	3 years	3 years
Customer relationships | Maximum
Acquired Finite-Lived Intangible Assets
Estimated Useful Life (in Years)	15 years	15 years
Developed technology
Acquired Finite-Lived Intangible Assets
Gross Carrying Amount	$ 22,333	$ 22,333
Accumulated Amortization	(15,500)	(14,791)
Net Carrying Amount	$ 6,833	$ 7,543
Developed technology | Minimum
Acquired Finite-Lived Intangible Assets
Estimated Useful Life (in Years)	5 years	5 years
Developed technology | Maximum
Acquired Finite-Lived Intangible Assets
Estimated Useful Life (in Years)	6 years	6 years
Non-compete agreements
Acquired Finite-Lived Intangible Assets
Estimated Useful Life (in Years)	5 years	5 years
Gross Carrying Amount	$ 1,600	$ 1,600
Accumulated Amortization	(640)	(560)
Net Carrying Amount	$ 960	$ 1,040
Trade name
Acquired Finite-Lived Intangible Assets
Estimated Useful Life (in Years)	3 years	3 years
Gross Carrying Amount	$ 850	$ 850
Accumulated Amortization	(566)	(496)
Net Carrying Amount	$ 284	$ 354

Goodwill, and Intangible Asse_5

Goodwill, and Intangible Assets - Narrative (Details) - USD ($) $ in Millions	3 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Goodwill and Intangible Assets Disclosure [Abstract]
Amortization of Intangible Assets	$ 2	$ 2

Goodwill, and Intangible Asse_6

Goodwill, and Intangible Assets - Schedule of Estimated Future Amortization Expenses (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Sep. 30, 2022
Fiscal Year
Remaining fiscal 2023	$ 5,178
2024	6,691
2025	6,620
2026	6,069
2027	2,266
2028 and thereafter	8,530
Net Carrying Amount	$ 35,354	$ 37,362

Cash, Cash Equivalents, and F_3

Cash, Cash Equivalents, and Funds Held for Customers (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Sep. 30, 2022
Cash and Cash Equivalents [Abstract]
Cash and cash equivalents	$ 175,194	$ 193,524
Funds held for customers	134	603
Total cash and cash equivalents	$ 175,328	$ 194,127

Derivative Instruments and He_2

Derivative Instruments and Hedging (Details) - Cash Flow Hedging - Foreign Currency Exchange Contracts - USD ($) $ in Millions	3 Months Ended
	Dec. 31, 2022	Sep. 30, 2022
Derivative
Foreign exchange contract terms	12 months
Notional amount	$ 0	$ 4.3

Convertible Senior Notes - Narr

Convertible Senior Notes - Narrative (Details)	1 Months Ended	3 Months Ended
	May 31, 2020 USD ($) d $ / shares	Dec. 31, 2022 USD ($) $ / shares	Sep. 30, 2022 $ / shares
Debt Instrument
Closing trading price (usd per share) | $ / shares		$ 100
Convertible Debt | Notes
Debt Instrument
Aggregate principal amount	$ 172,500,000
Debt instrument, interest rate (percent)	2.625%
Purchase option value	$ 22,500,000
Proceeds from issuance of debt	166,400,000
Debt issuance cost	$ 6,100,000
Conversion rate	0.0300044
Initial conversion price (usd per share) | $ / shares	$ 33.33		$ 33.33
Common stock for trading days | d	20
Consecutive trading days | d	30
Conversion threshold for trigger price (percent)	130%
Measurement period (days)	5 days
Minimum percentage of conversion price in the event of trigger event (percent)	98%
Redemption price (percent)	100%
Sinking fund	$ 0
Carrying amount of equity component	$ 57,200,000
Equity portion of debt issuance cost		$ 2,000,000
Amortized over period		29 months
Convertible Debt | Maximum | Notes
Debt Instrument
Conversion rate	0.0382555
Convertible Debt | Estimate of Fair Value Measurement | Notes
Debt Instrument
Carrying amount of the liability component		$ 115,300,000
Estimated fair value		234,200,000
Convertible Debt | Interest Expense | Notes
Debt Instrument
Debt issuance cost		$ 4,100,000
Convertible Debt | On or After June 6, 2023 | Notes
Debt Instrument
Redemption price (percent)	100%
Term Loan | Credit Agreement
Debt Instrument
Repayments of debt	$ 40,000,000

Convertible Senior Notes - Liab

Convertible Senior Notes - Liability and Equity Components (Details) - Convertible Debt - Notes - USD ($) $ in Thousands	Dec. 31, 2022	Sep. 30, 2022
Liability component:
Principal amount	$ 172,500	$ 172,500
Unamortized discount	0	(34,354)
Unamortized issuance costs	(3,061)	(2,729)
Net carrying amount	169,439	135,417
Equity component, net of issuance costs	$ 0	$ 55,227

Convertible Senior Notes - Inte

Convertible Senior Notes - Interest Expense Recognized (Details) - Convertible Debt - Notes - USD ($) $ in Thousands	3 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Debt Instrument
Coupon interest expense	$ 1,132	$ 1,132
Amortization of debt discount	0	2,504
Amortization of debt issuance costs	302	152
Total interest expense related to the Notes	$ 1,434	$ 3,788
Effective interest rate of the liability component	3.40%	12.32%

Stockholders' Equity - Componen

Stockholders' Equity - Component of Stockholders' Equity (Details) - USD ($) $ in Thousands	3 Months Ended		12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Sep. 30, 2022
Increase (Decrease) in Stockholders' Equity
Balance at beginning of period	$ 134,621	$ 123,518	$ 123,518
Balance at beginning of period (in shares)	37,358,000
Issuance of common stock upon exercise of stock options	$ 27	72
Stock-based compensation	15,460	12,678
Other comprehensive income (loss)	199	(13)
Net loss	(4,050)	(6,266)
Balance at end of period	$ 112,537	129,989	$ 134,621
Balance at end of period (in shares)	37,734,000		37,358,000
Accounting Standards Update			Accounting Standards Update 2020-06 [Member]
Cumulative Effect, Period of Adoption, Adjustment
Increase (Decrease) in Stockholders' Equity
Balance at beginning of period	$ (33,720)
Balance at end of period			$ (33,720)
Cumulative Effect, Period of Adoption, Adjusted Balance
Increase (Decrease) in Stockholders' Equity
Balance at beginning of period	100,901
Balance at end of period			100,901
Common Stock
Increase (Decrease) in Stockholders' Equity
Balance at beginning of period	$ 6	$ 5	$ 5
Balance at beginning of period (in shares)	37,358,000	36,059,000	36,059,000
Issuance of common stock upon exercise of stock options (in shares)	2,000	8,000
Issuance of common stock upon release of restricted stock units (in shares)	374,000	366,000
Balance at end of period	$ 6	$ 5	$ 6
Balance at end of period (in shares)	37,734,000	36,433,000	37,358,000
Common Stock | Cumulative Effect, Period of Adoption, Adjusted Balance
Increase (Decrease) in Stockholders' Equity
Balance at beginning of period	$ 6
Balance at beginning of period (in shares)	37,358,000
Balance at end of period			$ 6
Balance at end of period (in shares)			37,358,000
Additional Paid-In Capital
Increase (Decrease) in Stockholders' Equity
Balance at beginning of period	$ 421,473	$ 380,528	$ 380,528
Issuance of common stock upon exercise of stock options	27	72
Stock-based compensation	15,460	12,678
Balance at end of period	381,733	393,278	421,473
Additional Paid-In Capital | Cumulative Effect, Period of Adoption, Adjustment
Increase (Decrease) in Stockholders' Equity
Balance at beginning of period	(55,227)
Balance at end of period			(55,227)
Additional Paid-In Capital | Cumulative Effect, Period of Adoption, Adjusted Balance
Increase (Decrease) in Stockholders' Equity
Balance at beginning of period	366,246
Balance at end of period			366,246
Accumulated Other Comprehensive Loss
Increase (Decrease) in Stockholders' Equity
Balance at beginning of period	(2,413)	(1,205)	(1,205)
Other comprehensive income (loss)	199	(13)
Balance at end of period	(2,214)	(1,218)	(2,413)
Accumulated Other Comprehensive Loss | Cumulative Effect, Period of Adoption, Adjusted Balance
Increase (Decrease) in Stockholders' Equity
Balance at beginning of period	(2,413)
Balance at end of period			(2,413)
Accumulated Deficit
Increase (Decrease) in Stockholders' Equity
Balance at beginning of period	(284,445)	(255,810)	(255,810)
Net loss	(4,050)	(6,266)
Balance at end of period	(266,988)	$ (262,076)	(284,445)
Accumulated Deficit | Cumulative Effect, Period of Adoption, Adjustment
Increase (Decrease) in Stockholders' Equity
Balance at beginning of period	21,507
Balance at end of period			21,507
Accumulated Deficit | Cumulative Effect, Period of Adoption, Adjusted Balance
Increase (Decrease) in Stockholders' Equity
Balance at beginning of period	$ (262,938)
Balance at end of period			$ (262,938)

Stockholders' Equity - Narrativ

Stockholders' Equity - Narrative (Details) - USD ($) $ in Millions	3 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Equity [Abstract]
Additional paid in capital, restricted stock unit grants, portion of bonus recorded as stock-based compensation	$ 5.1	$ 5.4

Stock-based Compensation - Narr

Stock-based Compensation - Narrative (Details) shares in Millions	Dec. 31, 2022 shares
Share-Based Payment Arrangement [Abstract]
Approved stock reserved for future issuance (in shares)	1

Stock-based Compensation - Summ

Stock-based Compensation - Summary of Restricted Stock Unit Activity (Including Performance Based Restricted Stock Awards) Under All Equity Award Plans (Details) - Restricted Stock Units shares in Thousands	3 Months Ended
	Dec. 31, 2022 $ / shares shares
Restricted Stock Units Outstanding
Balance at beginning of period (in shares) | shares	2,055
Granted (in shares) | shares	1,211
Released (in shares) | shares	(374)
Forfeited (in shares) | shares	(29)
Balance at end of period (in shares) | shares	2,863
Weighted Average Grant Date Fair Value
Balance at beginning of period (in dollars per share) | $ / shares	$ 33.08
Granted (in dollars per share) | $ / shares	38.36
Released (in dollars per share) | $ / shares	31.49
Forfeited (in dollars per share) | $ / shares	30.98
Balance at end of period (in dollars per share) | $ / shares	$ 35.54

Stock-based Compensation - Su_2

Stock-based Compensation - Summary of Allocated Stock-based Compensation (Details) - USD ($) $ in Thousands	3 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Share-based Compensation Arrangement by Share-based Payment Award
Stock-based compensation	$ 10,404	$ 6,986
Total stock-based compensation in cost of revenues
Share-based Compensation Arrangement by Share-based Payment Award
Stock-based compensation	2,477	1,479
Research and development
Share-based Compensation Arrangement by Share-based Payment Award
Stock-based compensation	1,821	1,281
Sales and marketing
Share-based Compensation Arrangement by Share-based Payment Award
Stock-based compensation	2,388	1,620
General and administrative
Share-based Compensation Arrangement by Share-based Payment Award
Stock-based compensation	3,718	2,606
Total stock-based compensation in operating expenses
Share-based Compensation Arrangement by Share-based Payment Award
Stock-based compensation	7,927	5,507
Subscription | Total stock-based compensation in cost of revenues
Share-based Compensation Arrangement by Share-based Payment Award
Stock-based compensation	1,337	858
Professional services | Total stock-based compensation in cost of revenues
Share-based Compensation Arrangement by Share-based Payment Award
Stock-based compensation	$ 1,140	$ 621

Income Taxes (Details)

Income Taxes (Details) - USD ($)	3 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Income Tax Disclosure [Abstract]
Income tax provision	$ 432,000	$ 374,000
Effective income tax expense, rate	11.90%	6.30%
Benefit realized for current period losses	$ 0

Net Loss per Share - Computatio

Net Loss per Share - Computation of Basic and Diluted Net Loss per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Numerator
Net loss attributable to common stockholders, basic	$ (4,050)	$ (6,266)
Net loss attributable to common stockholders, diluted	$ (4,050)	$ (6,266)
Denominator
Weighted average shares used in computing net loss per share attributable to common stockholders, basic (in shares)	37,527	36,223
Weighted average shares used in computing net loss per share attributable to common stockholders, diluted (in shares)	37,527	36,223
Net loss per share attributable to common stockholders:
Basic (in dollars per share)	$ (0.11)	$ (0.17)
Diluted (in dollars per share)	$ (0.11)	$ (0.17)

Net Loss per Share - Summary of

Net Loss per Share - Summary of Weighted Average Shares of Common Stock Equivalents Excluded from Computation of Diluted Net Loss per Share Attributable to Common Stockholders (Details) - shares shares in Thousands	3 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Stock options
Antidilutive Securities Excluded from Computation of Earnings Per Share
Antidilutive securities excluded from computation of earnings per share amount (in shares)	2	17
Performance-based RSUs and RSUs
Antidilutive Securities Excluded from Computation of Earnings Per Share
Antidilutive securities excluded from computation of earnings per share amount (in shares)	2,863	2,512
Shares issuable pursuant to the employee stock purchase plan
Antidilutive Securities Excluded from Computation of Earnings Per Share
Antidilutive securities excluded from computation of earnings per share amount (in shares)	97	90
Convertible senior notes
Antidilutive Securities Excluded from Computation of Earnings Per Share
Antidilutive securities excluded from computation of earnings per share amount (in shares)	5,176	0

Net Loss per Share - Narrative

Net Loss per Share - Narrative (Details) - $ / shares	Sep. 30, 2022	May 31, 2020
Notes | Convertible Debt
Antidilutive Securities Excluded from Computation of Earnings Per Share
Conversion price (usd per share)	$ 33.33	$ 33.33

Geographic Information - Narrat

Geographic Information - Narrative (Details)	3 Months Ended
	Dec. 31, 2022 segment business	Dec. 31, 2021
Segment Reporting Information
Number of operating segment | segment	1
Number of business activity | business	1
Outside of United States | Revenue | Geographic concentration risk
Segment Reporting Information
Revenues from customers outside United States	5%	6%

Geographic Information - Compan

Geographic Information - Company's Property and Equipment, Net by Geographic Region (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Sep. 30, 2022
Geographic Areas, Long-Lived Assets
Total property and equipment, net	$ 1,566	$ 1,838
United States
Geographic Areas, Long-Lived Assets
Total property and equipment, net	944	1,113
India
Geographic Areas, Long-Lived Assets
Total property and equipment, net	$ 622	$ 725