Document And Entity Information
Document And Entity Information - shares shares in Millions | 3 Months Ended | |
Apr. 30, 2019 | May 31, 2019 | |
Document And Entity Information [Abstract] | ||
Entity Registrant Name | DOCUSIGN, INC. | |
Entity Central Index Key | 0001261333 | |
Current Fiscal Year End Date | --01-31 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | true | |
Entity Small Business | false | |
Document Period End Date | Apr. 30, 2019 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 173.8 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Apr. 30, 2019 | Jan. 31, 2019 |
Current assets | ||
Cash and cash equivalents | $ 236,476 | $ 517,811 |
Investments—current | 515,648 | 251,203 |
Restricted cash | 167 | 367 |
Accounts receivable | 117,134 | 174,548 |
Contract assets—current | 13,360 | 10,616 |
Prepaid expense and other current assets | 39,341 | 29,976 |
Total current assets | 922,126 | 984,521 |
Investments—noncurrent | 184,683 | 164,220 |
Property and equipment, net | 84,094 | 75,832 |
Operating lease right-of-use assets | 143,361 | |
Goodwill | 194,775 | 195,225 |
Intangible assets, net | 69,490 | 74,203 |
Deferred contract acquisition costs—noncurrent | 115,924 | 112,583 |
Other assets—noncurrent | 23,947 | 8,833 |
Total assets | 1,738,400 | 1,615,417 |
Current liabilities | ||
Accounts payable | 21,436 | 19,590 |
Accrued expenses | 28,133 | 21,755 |
Accrued compensation | 57,684 | 77,553 |
Contract liabilities—current | 385,460 | 381,060 |
Operating lease liabilities—current | 16,921 | |
Deferred rent—current | 2,452 | |
Other liabilities—current | 12,973 | 13,903 |
Total current liabilities | 522,607 | 516,313 |
Convertible senior notes, net | 445,385 | 438,932 |
Contract liabilities—noncurrent | 7,586 | 7,712 |
Operating lease liabilities—noncurrent | 154,778 | |
Deferred rent—noncurrent | 24,195 | |
Deferred tax liability—noncurrent | 4,267 | 4,207 |
Other liabilities—noncurrent | 6,095 | 9,696 |
Total liabilities | 1,140,718 | 1,001,055 |
Commitments and contingencies (Note 11) | ||
Stockholders’ equity | ||
Preferred stock, $0.0001 par value; 10,000 shares authorized, 0 shares issued and outstanding as of April 30, 2019 and January 31, 2019 | 0 | 0 |
Common stock, $0.0001 par value; 500,000 shares authorized, 173,628 shares outstanding as of April 30, 2019; 500,000 shares authorized, 169,303 shares outstanding as of January 31, 2019 | 17 | 17 |
Additional paid-in capital | 1,575,471 | 1,545,088 |
Accumulated other comprehensive loss | (3,258) | (1,965) |
Accumulated deficit | (974,548) | (928,778) |
Total stockholders’ equity | 597,682 | 614,362 |
Total liabilities and stockholders' equity | $ 1,738,400 | $ 1,615,417 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Apr. 30, 2019 | Jan. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in usd per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized (in shares) | 10,000,000 | 0 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in usd per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 500,000,000 | 500,000,000 |
Common stock, shares outstanding (in shares) | 173,628,000 | 169,303,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Apr. 30, 2019 | Apr. 30, 2018 | |
Revenue: | ||
Total revenue | $ 213,962 | $ 155,808 |
Cost of revenue: | ||
Total cost of revenue | 52,019 | 58,294 |
Gross profit | 161,943 | 97,514 |
Operating expenses: | ||
Sales and marketing | 129,936 | 191,085 |
Research and development | 37,183 | 70,870 |
General and administrative | 37,261 | 103,117 |
Total expenses | 204,380 | 365,072 |
Loss from operations | (42,437) | (267,558) |
Interest expense | (7,156) | (193) |
Interest income and other income (expense), net | 5,217 | (2,228) |
Loss before provision for income taxes | (44,376) | (269,979) |
Provision for income taxes | 1,346 | 708 |
Net loss | $ (45,722) | $ (270,687) |
Net loss per share attributable to common stockholders, basic and diluted (in usd per share) | $ (0.27) | $ (7.46) |
Weighted-average number of shares used in computing net loss per share attributable to common stockholders, basic and diluted (in shares) | 172,101 | 36,334 |
Other comprehensive loss: | ||
Foreign currency translation losses, net of tax | $ (1,631) | $ (2,328) |
Unrealized gains on investments, net of tax | 338 | 0 |
Other comprehensive loss | (1,293) | (2,328) |
Comprehensive loss | (47,015) | (273,015) |
Stock-based compensation expense included in costs and expenses: | ||
Stock-based compensation expense | 42,271 | 269,794 |
Sales and marketing | ||
Stock-based compensation expense included in costs and expenses: | ||
Stock-based compensation expense | 18,102 | 112,481 |
Research and development | ||
Stock-based compensation expense included in costs and expenses: | ||
Stock-based compensation expense | 7,317 | 47,268 |
General and administrative | ||
Stock-based compensation expense included in costs and expenses: | ||
Stock-based compensation expense | 11,130 | 84,045 |
Subscription | ||
Revenue: | ||
Total revenue | 201,458 | 148,198 |
Cost of revenue: | ||
Total cost of revenue | 33,119 | 32,438 |
Subscription | Cost of revenue | ||
Stock-based compensation expense included in costs and expenses: | ||
Stock-based compensation expense | 2,282 | 9,955 |
Professional services and other | ||
Revenue: | ||
Total revenue | 12,504 | 7,610 |
Cost of revenue: | ||
Total cost of revenue | 18,900 | 25,856 |
Professional services and other | Cost of revenue | ||
Stock-based compensation expense included in costs and expenses: | ||
Stock-based compensation expense | $ 3,440 | $ 16,045 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders' Equity (Deficit) (Unaudited) Statement - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Loss | Accumulated Deficit | Redeemable Convertible Preferred Stock |
Beginning balance (in shares) at Jan. 31, 2018 | 35,700 | |||||
Beginning balance at Jan. 31, 2018 | $ (338,648) | $ 4 | $ 160,265 | $ 3,403 | $ (502,320) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Exercise of stock options (in shares) | 1,076 | |||||
Exercise of stock options | 7,815 | 7,815 | ||||
Employee stock-based compensation expense | 269,753 | 269,753 | ||||
Non-employee stock-based compensation expense | 720 | 720 | ||||
Net loss | (270,687) | (270,687) | ||||
Other comprehensive loss, net | (2,328) | (2,328) | ||||
Ending balance (in shares) at Apr. 30, 2018 | 36,776 | |||||
Ending balance at Apr. 30, 2018 | (333,728) | $ 4 | 438,200 | 1,075 | (773,007) | |
Beginning balance (in shares) at Jan. 31, 2018 | 100,226 | |||||
Beginning balance at Jan. 31, 2018 | $ 547,501 | |||||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||
Accretion of preferred stock | (353) | $ 353 | ||||
Accretion of preferred stock | (353) | (353) | ||||
Ending balance (in shares) at Apr. 30, 2018 | 100,226 | |||||
Ending balance at Apr. 30, 2018 | $ 547,854 | |||||
Beginning balance (in shares) at Jan. 31, 2019 | 169,303 | |||||
Beginning balance at Jan. 31, 2019 | $ 614,362 | $ 17 | 1,545,088 | (1,965) | (928,778) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Exercise of stock options (in shares) | 2,634 | 2,634 | ||||
Exercise of stock options | $ 32,254 | 32,254 | ||||
Settlement of RSUs (in shares) | 2,463 | |||||
Tax withholding on RSU settlement (in shares) | (1,003) | |||||
Tax withholding on RSU settlement | (56,137) | (56,137) | ||||
Employee stock purchase plans (in shares) | 231 | |||||
Employee stock purchase plans | 10,563 | 10,563 | ||||
Employee stock-based compensation expense | 43,669 | 43,669 | ||||
Non-employee stock-based compensation expense | 34 | 34 | ||||
Net loss | (45,722) | (45,722) | ||||
Other comprehensive loss, net | (1,293) | (1,293) | ||||
Ending balance (in shares) at Apr. 30, 2019 | 173,628 | |||||
Ending balance at Apr. 30, 2019 | 597,682 | $ 17 | $ 1,575,471 | $ (3,258) | $ (974,548) | |
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||
Accretion of preferred stock | $ 0 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 30, 2019 | Apr. 30, 2018 | |
Cash flows from operating activities: | ||
Net loss | $ (45,722) | $ (270,687) |
Adjustments to reconcile net loss to net cash used in operating activities | ||
Depreciation and amortization | 11,971 | 8,600 |
Amortization of deferred contract acquisition and fulfillment costs | 14,260 | 9,246 |
Amortization of debt discount and transaction costs | 6,454 | 0 |
Amortization of operating lease right-of-use assets | 4,128 | |
Stock-based compensation expense | 42,271 | 269,794 |
Deferred income taxes | 52 | (6) |
Other | (1,111) | 2,225 |
Changes in operating assets and liabilities | ||
Accounts receivable | 57,414 | 19,622 |
Contract assets | (2,701) | 2,546 |
Prepaid expenses and other current assets | (7,107) | (6,519) |
Deferred contract acquisition and fulfillment costs | (20,487) | (12,326) |
Other assets | 541 | 440 |
Accounts payable | 282 | (7,218) |
Accrued expenses | 6,442 | 3,302 |
Accrued compensation | (19,869) | (16,947) |
Contract liabilities | 4,274 | 12,611 |
Operating lease liabilities | (3,705) | |
Other liabilities | (1,732) | 309 |
Net cash provided by operating activities | 45,655 | 14,992 |
Cash flows from investing activities: | ||
Purchases of marketable securities | (375,211) | 0 |
Maturities of marketable securities | 92,457 | 0 |
Purchases of strategic investments | (15,500) | 0 |
Purchases of property and equipment | (15,237) | (6,184) |
Net cash used in investing activities | (313,491) | (6,184) |
Cash flows from financing activities: | ||
Payment of tax withholding obligation on RSU settlement | (56,137) | 0 |
Proceeds from exercise of stock options | 32,254 | 7,815 |
Proceeds from employee stock purchase plan | 10,563 | 0 |
Payment of deferred offering costs | 0 | (2,194) |
Net cash provided by (used in) financing activities | (13,320) | 5,621 |
Effect of foreign exchange on cash, cash equivalents and restricted cash | (379) | (2,069) |
Net increase (decrease) in cash, cash equivalents and restricted cash | (281,535) | 12,360 |
Cash, cash equivalents and restricted cash at beginning of period | 518,178 | 257,436 |
Cash, cash equivalents and restricted cash at end of period | 236,643 | 269,796 |
Supplemental disclosure: | ||
Cash paid for interest | 1,414 | 144 |
Cash paid for operating lease liabilities | 4,729 | |
Cash paid for taxes | 131 | 1,516 |
Non-cash investing and financing activities: | ||
Property and equipment in accounts payable and other accrued liabilities | 3,791 | 3,238 |
Preferred stock accretion | 0 | 353 |
Deferred offering costs accrued and unpaid | 0 | $ 1,173 |
Operating lease right-of-use assets exchanged for lease obligations | 53,653 | |
Derecognition of build-to-suit lease | $ 2,479 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Apr. 30, 2019 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Organization and Description of Business DocuSign, Inc. (“we,” “our” or “us”) was incorporated in the State of Washington in April 2003. We merged with and into DocuSign, Inc., a Delaware corporation, in March 2015. We provide a platform that enables businesses of all sizes to digitally prepare, execute and act on agreements, thereby simplifying and accelerating the process of doing business. Basis of Presentation and Principles of Consolidation Our condensed consolidated financial statements include the accounts of DocuSign, Inc. and our wholly-owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. Our condensed consolidated financial statements have been prepared in accordance with United States ("U.S.") generally accepted accounting principles (“GAAP”) for interim financial information. Certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to the applicable rules and regulations of the Securities and Exchange Commission (“SEC”). Therefore, these unaudited interim consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes included in our 2019 Annual Report on Form 10-K. Our condensed consolidated financial statements are unaudited and have been prepared on a basis consistent with that used to prepare the audited annual consolidated financial statements and, in our opinion, include all adjustments of a normal recurring nature necessary for the fair statement of our financial position, results of operations and cash flows. Our condensed consolidated balance sheet as of January 31, 2019 was derived from audited financial statements but does not include all disclosures required by GAAP. The results of operations for the three months ended April 30, 2019 are not necessarily indicative of the results to be expected for the year ending January 31, 2020 . Our fiscal year ends on January 31. References to fiscal 2020 , for example, are to the fiscal year ending January 31, 2020 . Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant items subject to such estimates and assumptions include those related to the allocation of revenue between recognized and deferred amounts, allowance for bad debts, goodwill, intangible assets, deferred contract acquisition costs, customer benefit period, fair value of financial instruments, valuation of stock-based compensation, valuation of common stock, f air value of the liability and equity components of the convertible notes, whether an arrangement is or contains a lease, the discount rate used for operating leases, and the valuation allowance for deferred income taxes. Significant Accounting Policies Other than described below, there have been no changes to our significant accounting policies described in our 2019 Annual Report on Form 10-K that have had a material impact on our consolidated financial statements and related notes. Leases Leases arise from contractual obligations that convey the right to control the use of identified property, plant or equipment for a period of time in exchange for consideration. We determine whether an arrangement is or contains a lease at inception, based on whether there is an identified asset and whether we control the use of the identified asset throughout the period of use. At lease commencement date, we determine lease classification between finance and operating, allocate the consideration to the lease and nonlease components and recognize a right-of-use asset and corresponding lease liability for each lease component. A right-of-use asset represents our right to use an underlying asset and a lease liability represents our obligation to make payments during the lease term. The lease liability is initially measured as the present value of the remaining lease payments over the lease term. The discount rate used to determine the present value is our incremental borrowing rate unless the interest rate implicit in the lease is readily determinable. We estimate our incremental borrowing rate based on the information available at lease commencement date for borrowings with a similar term. The right-of-use asset is initially measured as the present value of the lease payments, adjusted for initial direct costs, prepaid lease payments to lessors and lease incentives. Our operating lease right-of-use assets and liabilities recognized at February 1, 2019, the adoption date, were based on the present value of lease payments over the remaining lease term as of that date, using the incremental borrowing rate as of that date. We elected the practical expedients to not recognize right-of-use assets and liabilities for leases with a term of less than twelve months and to not separate nonlease components from the associated lease components for our office leases and certain other asset classes. The total consideration includes fixed payments and contractual escalation provisions. We are responsible for maintenance, insurance, property taxes and other variable payments, which are expensed as incurred. Our leases include options to renew or terminate. We include the option to renew or terminate in our determination of the lease term when the option is deemed to be reasonably assured to be exercised. We account for changes in the expected lease term as a modification of the original contract. Operating leases are classified in " Operating lease right-of-use assets ", " Operating lease liabilities—current ", and " Operating lease liabilities—noncurrent " on our condensed consolidated balance sheets. Operating lease expense is recognized on a straight-line basis over the expected lease term and included in " Loss from operations " in our condensed consolidated statements of operations and comprehensive loss. Strategic Investments Our strategic investments consist of non-marketable equity investments in privately-held companies in which we do not have a controlling interest or significant influence. We have elected to apply the measurement alternative for equity investments that do not have readily determinable fair values, measuring them at cost, less any impairment, plus or minus adjustments resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. An impairment loss is recorded when event or circumstance indicates a decline in value has occurred. In March 2019, we purchased equity investments in privately-held companies totaling $15.5 million that were classified in " Other assets—noncurrent " on our condensed consolidated balance sheets. As there have been no material observable price changes, we have not recorded any adjustments resulting from observable price changes for identical or similar investments or impairment charges for any of our equity investments in privately-held companies in the three months ended April 30, 2019 . We had no such investments as of January 31, 2019 . Recently Adopted Accounting Pronouncements In February 2016, the Financial Accounting Standards Board (the "FASB") issued accounting standards update ("ASU") No. 2016-02, Leases (Topic 842), which supersedes current guidance related to accounting for leases. This guidance is intended to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. In July 2018, the FASB issued ASU No. 2018-10, Codification Improvements to Topic 842, Leases. The ASU makes 16 technical corrections to the new leases standard and other accounting topics, alleviating unintended consequences from applying the new standard. It does not make any substantive changes to the core provisions or principles of the new standard. In July 2018, the FASB also issued ASU No. 2018-11, Leases (Topic 842). The ASU provides (1) an optional transition method that entities can use when adopting the standard and (2) a practical expedient that permits lessors to not separate nonlease components from the associated lease component if certain conditions are met. The standard is effective for public entities for annual and interim reporting periods beginning after December 15, 2018. We adopted the new standard as of February 1, 2019, and recognized a cumulative-effect adjustment to the opening balance of accumulated deficit as of the adoption date. We elected the optional transition approach to not apply Topic 842 in the comparative periods presented. We elected the practical expedient to use hindsight when determining the lease term and the package of practical expedients to not reassess whether existing contracts contain leases, the lease classification for existing leases and whether existing initial direct costs meet the new definition. The adoption of Topic 842 resulted in the recognition of total right-of-use assets of $93.9 million and total lease liabilities of $121.8 million as of adoption date, with the most significant impact related to our office space leases. Additionally, we derecognized $26.6 million in deferred rent and $2.5 million related to the build-to-suit asset and liability upon adoption of this standard pursuant to the transition guidance provided for build-to-suit leases. The adoption of Topic 842 did not have a material impact to the consolidated statements of operations or statements of cash flows. In February 2018, the FASB issued ASU No. 2018-02, Income Statement—Reporting Comprehensive Income (Topic 220), which allows a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act ("TCJA"). As the amendment only relates to the reclassification of the income tax effects of the TCJA, the underlying guidance that requires that the effect of a change in tax laws or rates be included in income from continuing operations is not affected. The standard is effective for annual and interim reporting periods beginning after December 15, 2018 for all entities. The amendment is to be applied either in the period of adoption or retrospectively to each period in which the effect of the change in the U.S. federal corporate income tax rate in the TCJA is recognized. Early adoption is permitted. The adoption of the standard did not have an impact on our consolidated financial statements. In June 2018, the FASB issued ASU No. 2018-07, Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting. The ASU aligns the measurement and classification guidance for share-based payments to nonemployees with the guidance for share-based payments to employees, with certain exceptions. Under the guidance, the measurement of equity-classified nonemployee awards will be fixed at the grant date. The ASU is effective for public business entities in annual periods beginning after December 15, 2018, and interim periods within those years. Early adoption is permitted, including in an interim period, but not before an entity adopts the topic 606 revenue guidance. The adoption of the standard did not have a material impact on our consolidated financial statements. In July 2018, the FASB issued ASU No. 2018-09, Codification Improvements, which clarifies, corrects errors in and makes improvements to several topics in the FASB Accounting Standard Codification. The transition and effective date guidance is based on the facts and circumstances of each amendment. Some of the amendments do not require transition guidance and were effective upon issuance of the ASU. Amendments that do have transition guidance are effective for public business entities for annual periods beginning after December 15, 2018. The adoption of the standard did not have a material impact on our consolidated financial statements. Other Recent Accounting Pronouncements In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments — Credit Losses (Topic 326). ASU 2016-13 changes the impairment model for most financial assets and will require the use of an expected loss model in place of the currently used incurred loss method. Under this model, entities will be required to estimate the lifetime expected credit loss on such instruments and record an allowance to offset the amortized cost basis of the financial asset, resulting in a net presentation of the amount expected to be collected on the financial asset. The update to the standard is effective for interim and annual periods beginning after December 15, 2019. We are evaluating the impact of the adoption of the ASU on our consolidated financial statements. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820), which modifies, removes and adds certain disclosure requirements on fair value measurements based on the FASB Concepts Statement, Conceptual Framework for Financial Reporting—Chapter 8: Notes to Financial Statements . The ASU is effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. The amendments on changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements and the narrative description of measurement uncertainty should be applied prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption. All other amendments should be applied retrospectively to all periods presented upon their effective date. Early adoption is permitted. We are in the process of evaluating the impact of the adoption of the ASU on our consolidated financial statements. In August 2018, the FASB issued ASU No. 2018-15, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40), which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal use software license). The accounting for the service element of a hosting arrangement that is a service contract is not affected by the amendments in this ASU. The amendments in this update are effective for public business entities for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. Early adoption is permitted. We are in the process of evaluating the impact of the adoption of the ASU on our consolidated financial statements. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Apr. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements We carry certain assets and liabilities at fair value. Fair value is defined as an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The three-tier hierarchy for inputs used in measuring fair value, which prioritizes the inputs based on the observability as of the measurement date, is as follows: Level 1 Quoted prices in active markets for identical assets or liabilities; Level 2 Observable inputs other than the quoted prices in active markets for identical assets and liabilities; and Level 3 Unobservable inputs for which there is little or no market data, which require us to develop assumptions of what market participants would use in pricing the asset or liability. The following table summarizes our financial assets that are measured at fair value on a recurring basis during the period: April 30, 2019 (in thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Level 1: Cash equivalents Money market funds $ 91,330 $ — $ — $ 91,330 Level 2: Cash equivalents Commercial paper 4,998 — — 4,998 Available-for-sale securities Commercial paper 62,695 31 (8 ) 62,718 Corporate notes and bonds 334,912 582 (34 ) 335,460 U.S. Treasury securities 232,152 32 (15 ) 232,169 U.S. government agency securities 69,977 12 (5 ) 69,984 Level 2 total 704,734 657 (62 ) 705,329 Total $ 796,064 $ 657 $ (62 ) $ 796,659 January 31, 2019 (in thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Level 1: Cash equivalents Money market funds $ 350,063 $ — $ — $ 350,063 Level 2: Cash equivalents Commercial paper 76,828 — (11 ) 76,817 Corporate notes and bonds 2,998 — — 2,998 U.S. government agency securities 6,491 — — 6,491 Available-for-sale securities Commercial paper 86,655 4 (21 ) 86,638 Corporate notes and bonds 287,496 389 (105 ) 287,780 U.S. Treasury securities 4,982 — (1 ) 4,981 U.S. government agency securities 36,021 7 (4 ) 36,024 Level 2 total 501,471 400 (142 ) 501,729 Total $ 851,534 $ 400 $ (142 ) $ 851,792 Money market funds consist of cash equivalents with original maturities of three months or less at the date of purchase. We use quoted prices in active markets for identical assets or liabilities to determine the fair value of our Level 1 investments in money market funds. The fair value of our Level 2 investments is determined using pricing based on quoted market prices or alternative market observable inputs . The fair value of our available-for-sale marketable securities as of April 30, 2019 , by remaining contractual maturities, were as follows (in thousands): Due in one year or less $ 515,648 Due in one to two years 184,683 $ 700,331 As of April 30, 2019 , we had a total of 155 available-for-sale securities, none of which were considered to be other-than-temporarily impaired. Convertible Senior Notes As of April 30, 2019 , the estimated fair value of our 0.5% Convertible Senior Notes with aggregate principal amount of $575.0 million was $615.4 million . We estimated the fair value based on the quoted market prices in an inactive market on the last trading day of the reporting period (Level 2). These Convertible Senior Notes are recorded at face value less unamortized debt discount and transaction costs as " Convertible senior notes, net " on our consolidated balance sheets. Refer to Note 9 for further information. |
Revenue and Performance Obligat
Revenue and Performance Obligations | 3 Months Ended |
Apr. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenue and Performance Obligations | Revenue and Performance Obligations Subscription revenue is recognized over time and accounted for approximately 94% and 95% of our revenue for the three months ended April 30, 2019 and 2018 . The typical subscription term is one to three years . Most of our subscription contracts are noncancelable over the contractual term. Customers typically have the right to terminate their contracts for cause, if we fail to perform. As of April 30, 2019 , the aggregate amount of the transaction price allocated to remaining performance obligations was $574.0 million , which consists of both billed and unbilled consideration that we expect to recognize as subscription revenue. We expect to recognize 53% of the transaction price in the twelve months following April 30, 2019 , in our consolidated statement of operations and comprehensive loss with the remainder recognized thereafter. We elected to apply the practical expedient to not disclose the transaction price allocated to remaining performance obligations for contracts with a contract term of one year or less. In addition, we do not disclose the transaction price related to revenue from professional services, training services and web revenue as revenue from these sources is recognized within one year. Contract Balances Contract assets represent amounts for which we have recognized revenue, pursuant to our revenue recognition policy, for contracts that have not yet been invoiced to our customers where there is a remaining performance obligation, typically for multi-year arrangements. Total contract assets were $14.6 million and $11.9 million as of April 30, 2019 and January 31, 2019 , of which $1.3 million was noncurrent and included within "Other assets—noncurrent" on our consolidated balance sheets as of both periods. The change in contract assets reflects the difference in timing between our satisfaction of remaining performance obligations and our contractual right to bill our customers. Contract liabilities consist of deferred revenue and include payments received in advance of performance under the contract. Such amounts are generally recognized as revenue over the contractual period. For the three months ended April 30, 2019 and 2018 , we recognized revenue of $157.0 million and $112.0 million that was included in the corresponding contract liability balance at the beginning of the periods presented. We receive payments from customers based upon contractual billing schedules. We record accounts receivable when the right to consideration becomes unconditional. Payment terms on invoiced amounts are typically 30 days. Deferred Contract Acquisition and Fulfillment Costs The following table represents a rollforward of our deferred contract acquisition costs: Three Months Ended April 30, (in thousands) 2019 2018 Beginning balance $ 115,985 $ 77,344 Additions to deferred contract acquisition costs 17,401 11,969 Amortization of deferred contract acquisition costs (13,150 ) (8,788 ) Cumulative translation adjustment (1,103 ) — Ending balance $ 119,133 $ 80,525 Deferred contract acquisition costs, current $ 3,209 $ 2,124 Deferred contract acquisitions costs, noncurrent 115,924 78,401 Total $ 119,133 $ 80,525 The following table represents our contract fulfillment costs, which include third-party service fees: Three Months Ended April 30, (in thousands) 2019 2018 Beginning balance $ 3,432 $ 3,316 Additions to deferred contract fulfillment costs 3,086 357 Amortization of deferred contract fulfillment costs (1,110 ) (458 ) Ending balance $ 5,408 $ 3,215 Deferred contract fulfillment costs, current $ 2,493 $ 1,188 Deferred contract fulfillment costs, noncurrent 2,915 2,027 Total $ 5,408 $ 3,215 Current deferred contract acquisition and fulfillment costs are included in "Prepaid expense and other current assets" and noncurrent costs are included in "Other assets—noncurrent" on our consolidated balance sheets. |
Property and Equipment, Net
Property and Equipment, Net | 3 Months Ended |
Apr. 30, 2019 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, Net | Property and Equipment, Net Property and equipment consisted of the following: (in thousands) April 30, 2019 January 31, 2019 Computer and network equipment $ 55,107 $ 55,233 Software, including capitalized software development costs 30,477 27,959 Furniture and office equipment 11,587 9,511 Leasehold improvements 43,477 41,464 140,648 134,167 Less: Accumulated depreciation (70,448 ) (66,479 ) 70,200 67,688 Work in progress 13,894 8,144 $ 84,094 $ 75,832 Depreciation expense associated with property and equipment was $7.2 million and $6.2 million for the three months ended April 30, 2019 and 2018 . As of January 31, 2019 , leasehold improvements include $2.5 million related to the fair value of the Israel leased space that was recorded under the build-to-suit lease guidance. Upon adoption of Topic 842 on February 1, 2019, we derecognized the build-to-suit asset and recognized an operating right-of-use asset for the related lease within the condensed consolidated balance sheet as of April 30, 2019 . Refer to Note 1 |
Acquisition of SpringCM Inc.
Acquisition of SpringCM Inc. | 3 Months Ended |
Apr. 30, 2019 | |
Business Combinations [Abstract] | |
Acquisition of SpringCM Inc. | Acquisition of SpringCM Inc. On September 4, 2018 , we completed the acquisition of SpringCM Inc. ("SpringCM"), a cloud-based document generation and contract lifecycle management software company based in Chicago, Illinois. With the addition of SpringCM's capabilities in document generation, redlining, advanced document management and end-to-end agreement workflow, the deal further accelerates the broadening of our solution beyond e-signature to the rest of the agreement process—from preparing to signing, acting-on and managing agreements. Under the terms of the agreement, we acquired SpringCM for approximately $218.8 million in cash, excluding cash acquired, working capital and transaction cost adjustments. Of the cash paid at closing, $8.2 million will be held in escrow for an 18 -month period after closing to secure our indemnification rights under the Merger Agreement. Additionally, we granted certain continuing employees of SpringCM restricted stock units ("RSUs") with a service and performance conditions covering up to 0.5 million shares that will be accounted for as a post-acquisition compensation expense over the vesting period. The performance-based condition will be satisfied upon SpringCM meeting certain revenue targets. As of April 30, 2019 , the performance-based condition was not considered probable. We accounted for the transaction as a business combination using the acquisition method of accounting. We allocated the purchase price to the tangible and identifiable intangible assets acquired and liabilities assumed based on their respective estimated fair values on the acquisition date. Fair values were determined using the valuation performed by management. Excess purchase price consideration was recorded as goodwill and is primarily attributable to the assembled workforce and expanded market opportunities when integrating SpringCM’s capabilities in document generation, redlining, advanced document management and end-to-end agreement workflow with our other offerings. We engaged third party valuation specialists to aid our analysis of the fair value of the acquired intangibles. All estimates, key assumptions, and forecasts were either provided by or reviewed by us. While we chose to utilize a third-party valuation specialist for assistance, the fair value analysis and related valuations reflect the conclusions of management and not those of any third party. The fair values of the assets acquired and liabilities assumed were determined using the market, income and cost approaches. The purchase price allocation was prepared on a preliminary basis and is subject to further adjustments as additional information becomes available concerning the fair value of the assets acquired and liabilities assumed. Any adjustments to the purchase price allocation will be made as soon as practicable but no later than one year from the acquisition date. The following table summarizes the acquisition date fair values of assets acquired and liabilities assumed at the date of acquisition: (in thousands) September 4, 2018 Cash and cash equivalents $ 6,950 Accounts receivable and other assets 10,542 Property and equipment 6,108 Goodwill 159,097 Intangible assets 73,000 Contract liabilities (9,973 ) Other liabilities (12,948 ) Deferred tax liability (7,047 ) $ 225,729 None of the goodwill recognized upon acquisition is deductible for U.S. federal income tax purposes. The estimated useful lives, primarily based on the expected period of benefit to us, and fair values of the identifiable intangible assets at acquisition date were as follows: (in thousands, except years) Estimated Fair Value Expected Useful Life Existing technology $ 11,900 3 years Customer relationships—subscription 54,200 9 years Backlog—subscription 6,400 2 years Tradenames / trademarks 500 1 year Total preliminary intangible assets $ 73,000 In the year ended January 31, 2019, we incurred acquisition costs of $1.8 million . These costs included legal, accounting fees and other costs directly related to the acquisition and are classified within operating expenses in our condensed consolidated statements of operations. The following unaudited pro forma information has been prepared for illustrative purposes only and assumes the acquisition occurred on February 1, 2017. It includes pro forma adjustments related to the amortization of acquired intangible assets, stock-based compensation expense, professional services revenue and contract acquisitions costs adjustments under the new revenue recognition standard, and contract liabilities fair value adjustment. The unaudited pro forma results have been prepared based on estimates and assumptions, which we believe are reasonable, however, they are not necessarily indicative of the consolidated results of operations had the acquisition occurred on February 1, 2017, or of future results of operations: (in thousands, except per share data) April 30, 2018 Revenue $ 162,104 Net loss (280,642 ) Net loss per share attributable to common stockholders, basic and diluted (7.72 ) |
Goodwill and Intangible Assets,
Goodwill and Intangible Assets, Net | 3 Months Ended |
Apr. 30, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets, Net | Goodwill and Intangible Assets, Net The changes in the carrying amount of goodwill for the three months ended April 30, 2019 were as follows (in thousands): Balance at January 31, 2019 $ 195,225 Cumulative translation adjustment (450 ) Balance at April 30, 2019 $ 194,775 Intangible assets consisted of the following: As of April 30, 2019 As of January 31, 2019 (in thousands) Weighted-average Remaining Useful Life (Years) Estimated Fair Value Accumulated Amortization Acquisition-related Intangibles, Net Estimated Fair Value Accumulated Amortization Acquisition-related Intangibles, Net Existing technology 2.4 $ 31,594 $ (22,053 ) $ 9,541 $ 31,594 $ (20,747 ) $ 10,847 Tradenames / trademarks 0.7 2,419 (2,048 ) 371 2,419 (1,858 ) 561 Customer contracts & related relationships 8.1 65,782 (13,185 ) 52,597 65,782 (11,168 ) 54,614 Certifications 1.3 6,917 (5,191 ) 1,726 6,917 (4,846 ) 2,071 Maintenance contracts & related relationships 1.1 1,498 (1,179 ) 319 1,498 (1,104 ) 394 Backlog—Subscription 1.4 6,400 (2,104 ) 4,296 6,400 (1,304 ) 5,096 6.6 $ 114,610 $ (45,760 ) 68,850 $ 114,610 $ (41,027 ) 73,583 Cumulative translation adjustment 640 620 Total $ 69,490 $ 74,203 Amortization of finite-lived intangible assets for the three months ended April 30, 2019 and 2018 was as follows: Three Months Ended April 30, (in thousands) 2019 2018 Cost of subscription revenue $ 1,627 $ 1,668 Sales and marketing 3,106 765 Total $ 4,733 $ 2,433 As of April 30, 2019 , future amortization of finite-lived intangibles that will be recorded in cost of revenue and operating expenses is estimated as follows, excluding cumulative translation adjustment (in thousands): Fiscal 2020, remainder $ 12,984 Fiscal 2021 13,818 Fiscal 2022 8,370 Fiscal 2023 6,023 Fiscal 2024 6,023 Thereafter 21,632 Total $ 68,850 |
Contract Balances
Contract Balances | 3 Months Ended |
Apr. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Contract Balances | Revenue and Performance Obligations Subscription revenue is recognized over time and accounted for approximately 94% and 95% of our revenue for the three months ended April 30, 2019 and 2018 . The typical subscription term is one to three years . Most of our subscription contracts are noncancelable over the contractual term. Customers typically have the right to terminate their contracts for cause, if we fail to perform. As of April 30, 2019 , the aggregate amount of the transaction price allocated to remaining performance obligations was $574.0 million , which consists of both billed and unbilled consideration that we expect to recognize as subscription revenue. We expect to recognize 53% of the transaction price in the twelve months following April 30, 2019 , in our consolidated statement of operations and comprehensive loss with the remainder recognized thereafter. We elected to apply the practical expedient to not disclose the transaction price allocated to remaining performance obligations for contracts with a contract term of one year or less. In addition, we do not disclose the transaction price related to revenue from professional services, training services and web revenue as revenue from these sources is recognized within one year. Contract Balances Contract assets represent amounts for which we have recognized revenue, pursuant to our revenue recognition policy, for contracts that have not yet been invoiced to our customers where there is a remaining performance obligation, typically for multi-year arrangements. Total contract assets were $14.6 million and $11.9 million as of April 30, 2019 and January 31, 2019 , of which $1.3 million was noncurrent and included within "Other assets—noncurrent" on our consolidated balance sheets as of both periods. The change in contract assets reflects the difference in timing between our satisfaction of remaining performance obligations and our contractual right to bill our customers. Contract liabilities consist of deferred revenue and include payments received in advance of performance under the contract. Such amounts are generally recognized as revenue over the contractual period. For the three months ended April 30, 2019 and 2018 , we recognized revenue of $157.0 million and $112.0 million that was included in the corresponding contract liability balance at the beginning of the periods presented. We receive payments from customers based upon contractual billing schedules. We record accounts receivable when the right to consideration becomes unconditional. Payment terms on invoiced amounts are typically 30 days. Deferred Contract Acquisition and Fulfillment Costs The following table represents a rollforward of our deferred contract acquisition costs: Three Months Ended April 30, (in thousands) 2019 2018 Beginning balance $ 115,985 $ 77,344 Additions to deferred contract acquisition costs 17,401 11,969 Amortization of deferred contract acquisition costs (13,150 ) (8,788 ) Cumulative translation adjustment (1,103 ) — Ending balance $ 119,133 $ 80,525 Deferred contract acquisition costs, current $ 3,209 $ 2,124 Deferred contract acquisitions costs, noncurrent 115,924 78,401 Total $ 119,133 $ 80,525 The following table represents our contract fulfillment costs, which include third-party service fees: Three Months Ended April 30, (in thousands) 2019 2018 Beginning balance $ 3,432 $ 3,316 Additions to deferred contract fulfillment costs 3,086 357 Amortization of deferred contract fulfillment costs (1,110 ) (458 ) Ending balance $ 5,408 $ 3,215 Deferred contract fulfillment costs, current $ 2,493 $ 1,188 Deferred contract fulfillment costs, noncurrent 2,915 2,027 Total $ 5,408 $ 3,215 Current deferred contract acquisition and fulfillment costs are included in "Prepaid expense and other current assets" and noncurrent costs are included in "Other assets—noncurrent" on our consolidated balance sheets. |
Deferred Contract Acquisition a
Deferred Contract Acquisition and Fulfillment Costs | 3 Months Ended |
Apr. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Deferred Contract Acquisition and Fulfillment Costs | Revenue and Performance Obligations Subscription revenue is recognized over time and accounted for approximately 94% and 95% of our revenue for the three months ended April 30, 2019 and 2018 . The typical subscription term is one to three years . Most of our subscription contracts are noncancelable over the contractual term. Customers typically have the right to terminate their contracts for cause, if we fail to perform. As of April 30, 2019 , the aggregate amount of the transaction price allocated to remaining performance obligations was $574.0 million , which consists of both billed and unbilled consideration that we expect to recognize as subscription revenue. We expect to recognize 53% of the transaction price in the twelve months following April 30, 2019 , in our consolidated statement of operations and comprehensive loss with the remainder recognized thereafter. We elected to apply the practical expedient to not disclose the transaction price allocated to remaining performance obligations for contracts with a contract term of one year or less. In addition, we do not disclose the transaction price related to revenue from professional services, training services and web revenue as revenue from these sources is recognized within one year. Contract Balances Contract assets represent amounts for which we have recognized revenue, pursuant to our revenue recognition policy, for contracts that have not yet been invoiced to our customers where there is a remaining performance obligation, typically for multi-year arrangements. Total contract assets were $14.6 million and $11.9 million as of April 30, 2019 and January 31, 2019 , of which $1.3 million was noncurrent and included within "Other assets—noncurrent" on our consolidated balance sheets as of both periods. The change in contract assets reflects the difference in timing between our satisfaction of remaining performance obligations and our contractual right to bill our customers. Contract liabilities consist of deferred revenue and include payments received in advance of performance under the contract. Such amounts are generally recognized as revenue over the contractual period. For the three months ended April 30, 2019 and 2018 , we recognized revenue of $157.0 million and $112.0 million that was included in the corresponding contract liability balance at the beginning of the periods presented. We receive payments from customers based upon contractual billing schedules. We record accounts receivable when the right to consideration becomes unconditional. Payment terms on invoiced amounts are typically 30 days. Deferred Contract Acquisition and Fulfillment Costs The following table represents a rollforward of our deferred contract acquisition costs: Three Months Ended April 30, (in thousands) 2019 2018 Beginning balance $ 115,985 $ 77,344 Additions to deferred contract acquisition costs 17,401 11,969 Amortization of deferred contract acquisition costs (13,150 ) (8,788 ) Cumulative translation adjustment (1,103 ) — Ending balance $ 119,133 $ 80,525 Deferred contract acquisition costs, current $ 3,209 $ 2,124 Deferred contract acquisitions costs, noncurrent 115,924 78,401 Total $ 119,133 $ 80,525 The following table represents our contract fulfillment costs, which include third-party service fees: Three Months Ended April 30, (in thousands) 2019 2018 Beginning balance $ 3,432 $ 3,316 Additions to deferred contract fulfillment costs 3,086 357 Amortization of deferred contract fulfillment costs (1,110 ) (458 ) Ending balance $ 5,408 $ 3,215 Deferred contract fulfillment costs, current $ 2,493 $ 1,188 Deferred contract fulfillment costs, noncurrent 2,915 2,027 Total $ 5,408 $ 3,215 Current deferred contract acquisition and fulfillment costs are included in "Prepaid expense and other current assets" and noncurrent costs are included in "Other assets—noncurrent" on our consolidated balance sheets. |
Convertible Senior Notes
Convertible Senior Notes | 3 Months Ended |
Apr. 30, 2019 | |
Debt Disclosure [Abstract] | |
Convertible Senior Notes | Convertible Senior Notes In September 2018, we issued $575.0 million aggregate principal amount of 0.5% Convertible Senior Notes due in 2023 (the Notes), including the initial purchasers’ exercise in full of their option to purchase an additional $75.0 million principal amount of the Notes, in a private placement to qualified institutional buyers in an offering exempt from registration under the Securities Act. The net proceeds from the issuance of the Notes were $560.8 million after deducting the initial purchasers’ discounts and transaction costs. The Notes are governed by an indenture (the “Indenture”) between us, as the issuer, and U.S. Bank National Association, as trustee. The Notes are senior unsecured obligations and rank senior in right of payment to any of our indebtedness that is expressly subordinated in right of payment to the Notes; equal in right of payment to any of our unsecured indebtedness then existing and future liabilities that are not so subordinated; effectively junior in right of payment to any of our secured indebtedness, to the extent of the value of the assets securing such indebtedness; and structurally junior to all indebtedness and other liabilities (including trade payables) of our subsidiaries. The Indenture does not contain any financial covenants or restrictions on the payments of dividends, the incurrence of indebtedness, or the issuance or repurchase of securities by us or any of our subsidiaries. The Notes mature on September 15, 2023 unless earlier repurchased or redeemed by us or earlier converted in accordance with their terms prior to the maturity date. Interest is payable semi-annually in arrears on March 15 and September 15 of each year, beginning on March 15, 2019. The Notes have an initial conversion rate of 13.9860 shares of our common stock per $1,000 principal amount of Notes, which is equal to an initial conversion price of approximately $71.50 per share of our common stock and is subject to adjustment in some events. Following certain corporate events that occur prior to the maturity date or following our issuance of a notice of redemption, we will increase the conversion rate for a holder who elects to convert its Notes in connection with such corporate event or during the related redemption period in certain circumstances. Additionally, upon the occurrence of a corporate event that constitutes a “fundamental change” per the Indenture, holders of the Notes may require us to repurchase for cash all or a portion of their Notes at a purchase price equal to 100% of the principal amount of the Notes plus accrued and unpaid interest. On or after June 15, 2023, until the close of business on September 13, 2023, holders may convert all or any portion of their Notes at any time regardless of whether the conditions set forth below have been met. Upon conversion, holders will receive cash, shares of our common stock or a combination of cash and shares of our common stock, at our election. Holders of the Notes may convert all or any portion of their Notes at any time prior to the close of business on June 14, 2023, in integral multiples of $1,000 principal amount, only under the following circumstances: • During any fiscal quarter commencing after the fiscal quarter ending on January 31, 2019 (and only during such fiscal quarter), if the last reported sale price of our 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 fiscal quarter is greater than or equal to 130% of the conversion price on each applicable trading day; • During the 5 -business day period after any 10 consecutive trading day period (the “measurement period”) in which the trading price as defined in the Indenture per $1,000 principal amount of notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of our common stock and the conversion rate on each such trading day; • If we call 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 described in the Indenture. We may redeem for cash or shares all or any portion of the Notes, at our option, at a redemption price equal to 100% of the principal amount of the notes to be redeemed, plus accrued and unpaid interest, beginning on or after September 20, 2021 if the last reported sale price of our 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 fiscal quarter is greater than or equal to 130% of the conversion price on each applicable trading day. As of April 30, 2019 , the conditions allowing holders of the Notes to convert have not been met and therefore the Notes are not yet convertible. We account for the Notes as separate liability and equity components. We determined the carrying amount of the liability component as the present value of its cash flows using a discount rate of 6% based on comparable convertible transactions for similar companies. The carrying amount of the equity component representing the conversion option was $134.7 million and was calculated by deducting the carrying value of the liability component from the principal amount of the Notes as a whole. This difference represents a debt discount that is amortized to interest expense over the term of the Notes using the effective interest rate method. The equity component is not remeasured as long as it continues to meet the conditions for equity classification. We allocate transaction costs related to the issuance of the Notes to the liability and equity components using the same proportions as the initial carrying value of the Notes. Transaction costs attributable to the liability component were $10.9 million and are being amortized to interest expense using the effective interest method over the term of the Notes. Transaction costs attributable to the equity component were $3.3 million and are netted with the equity component of the Notes in stockholders’ equity. The net carrying value of the liability component of the Notes was as follows: (in thousands) April 30, 2019 Principal $ 575,000 Less: unamortized debt discount (119,903 ) Less: unamortized transaction costs (9,712 ) Net carrying amount $ 445,385 The net carrying amount of the equity component of the Notes was as follows: (in thousands) April 30, 2019 Proceeds allocated to the conversion option (debt discount) $ 134,667 Less: transaction costs (3,336 ) Net carrying amount $ 131,331 The interest expense recognized related to the Notes was as follows: (in thousands) Three Months Ended April 30, 2019 Contractual interest expense $ 710 Amortization of debt discount 484 Amortization of transaction costs 5,970 Total $ 7,164 Capped Calls In connection with the offering of the Notes, we entered into privately-negotiated capped call transactions ("Capped Calls") with certain counterparties. The Capped Calls each have an initial strike price of approximately $71.50 per share, subject to certain adjustments, which corresponds to the initial conversion price of the Notes. The Capped Calls have initial cap prices of $110.00 per share, subject to certain adjustments. The Capped Calls cover, subject to anti-dilution adjustments, approximately 8.0 million shares of our common stock. The Capped Calls are generally intended to reduce or offset the potential dilution to our common stock upon any conversion of the Notes with such reduction or offset, as the case may be, subject to a cap based on the cap price. As the Capped Call transactions are considered indexed to our own stock and are considered equity classified, they are recorded in stockholders’ equity and are not accounted for as derivatives. The cost of $67.6 million incurred in connection with the Capped Calls was recorded as a reduction to additional paid-in capital. Impact on Earnings Per Share The Notes will not have an impact on our diluted earnings per share until the average market price of our common stock exceeds the cap price of $110.00 per share, as we intend and have the ability to settle the principal amount of the Notes in cash upon conversion. We are required under the treasury stock method to compute the potentially dilutive shares of common stock related to the Notes for periods we report net income. However, upon conversion, there will be no economic dilution from the Notes until the average market price of our common stock exceeds the cap price of $110.00 per share, as exercise of the Capped Calls offsets any dilution from the Notes from the conversion price up to the cap price. Capped Calls are excluded from the calculation of diluted earnings per share, as they would be antidilutive under the treasury stock method. |
Leases
Leases | 3 Months Ended |
Apr. 30, 2019 | |
Leases [Abstract] | |
Leases | Leases We lease office space and equipment under non-cancelable operating lease agreements that expire at various dates through February 2032 . As of April 30, 2019 , we have no finance leases. The following table is a summary of our operating lease costs for the three months ended April 30, 2019 , (in thousands, except years and rates): Three Months Ended April 30, 2019 Operating lease cost $ 5,706 Short-term lease cost 269 Variable lease cost and other, net 49 Total lease cost $ 6,024 Weighted average remaining term (years) 8.3 Weighted average discount rate 4.4 % Future lease payments as of April 30, 2019 were as follows (in thousands): Fiscal 2020, remainder $ 16,872 Fiscal 2021 26,319 Fiscal 2022 27,285 Fiscal 2023 27,724 Fiscal 2024 27,834 Thereafter 79,580 Total undiscounted cash flows $ 205,614 Less imputed interest (33,915 ) Present value of lease liabilities $ 171,699 The future minimum annual lease payments as of January 31, 2019 , related to the outstanding lease agreements were as follows (in thousands): Fiscal 2020 $ 22,198 Fiscal 2021 22,617 Fiscal 2022 22,556 Fiscal 2023 23,173 Fiscal 2024 23,373 Thereafter 34,634 Total minimum lease payments $ 148,551 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Apr. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies As of April 30, 2019 , we had unused letters of credit outstanding associated with our various operating leases totaling $9.7 million . We have entered into certain noncancelable contractual arrangements that require future purchases of goods and services. These arrangements primarily relate to cloud infrastructure support and sales and marketing activities. As of April 30, 2019 , our noncancelable contractual obligations with a remaining term of more than one year were as follows (in thousands): Fiscal 2020, remainder $ 6,142 Fiscal 2021 10,987 Fiscal 2022 9,379 Fiscal 2023 898 Fiscal 2024 943 Thereafter 4,555 Total $ 32,904 Indemnification We enter into indemnification provisions under our agreements with other companies in the ordinary course of business, including business partners, contractors and parties performing our research and development. Pursuant to these arrangements, we agree to indemnify and defend the indemnified party for certain claims and related losses suffered or incurred by the indemnified party from actual or threatened third-party claim because of our activities. The duration of these indemnification agreements is generally perpetual. The maximum potential amount of future payments we could be required to make under these indemnifications is not determinable. Historically, we have not incurred material costs to defend lawsuits or settle claims related to these indemnification agreements. As a result, we believe the fair value of these indemnification agreements is not material as of April 30, 2019 and January 31, 2018. We maintain commercial general liability insurance and product liability insurance to offset certain of our potential liabilities under these indemnification agreements. We have entered into indemnification agreements with each of our directors and executive officers. These agreements require us to indemnify such individuals, to the fullest extent permitted by Delaware law, for certain liabilities to which they may become subject as a result of their affiliation with us. Claims and Litigation |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Apr. 30, 2019 | |
Equity [Abstract] | |
Stockholders' Equity | Stockholders' Equity Equity Incentive Plans We maintain three stock-based compensation plans: the 2018 Equity Incentive Plan (the "2018 Plan"), the Amended and Restated 2011 Equity Incentive Plan (the “2011 Plan”) and the Amended and Restated 2003 Stock Plan (the “2003 Plan”). Our board of directors adopted, and our stockholders approved the 2018 Plan during the year ended January 31, 2019 . The 2018 Plan went into effect in April 2018, upon the effectiveness of our IPO Registration Statement. This plan serves as a successor to the 2011 Plan and 2003 Plan and provides for the grant of stock-based awards to our employees, directors and consultants. No additional awards under the 2011 Plan or 2003 Plan were made as of the effective date of the 2018 Plan. Outstanding awards under these two plans continue to be subject to the terms and conditions of the respective plans. Shares available for grant under the 2011 Plan that were reserved but not issued as of the effective date of the 2018 Plan were added to the reserves of the 2018 Plan. Any shares subject to outstanding awards originally granted under the 2011 Plan that: (i) expire or terminate for any reason prior to exercise or settlement; (ii) are forfeited because of the failure to meet a contingency or condition required to vest such shares or otherwise return to the Company; or (iii) are reacquired, withheld (or not issued) to satisfy a tax withholding obligation in connection with an award or to satisfy the purchase price or exercise price of a stock award shall become available for future issuance pursuant to the 2018 Plan. As of April 30, 2019 , 26.8 million shares were available for future issuance under the 2018 Plan. The number of shares reserved under the 2018 Plan will automatically increase on the first day of each fiscal year, starting on February 1, 2019 and continuing through February 1, 2028, in an amount equal to (i) 5% of the total number of shares of our capital stock outstanding on January 31st of the preceding fiscal year or (ii) a lesser number of shares as determined by our board of directors. Pursuant to this automatic increase, the Compensation Committee of our board of directors approved an increase of 8.5 million shares reserved for issuance effective on February 1, 2019. Stock Options Option activity for the three months ended April 30, 2019 , was as follows: (in thousands, except per share and years data) Number of Options Outstanding Weighted-Average Exercise Price Per Share Weighted-Average Remaining Contractual Term (Years) Aggregate Intrinsic Value Outstanding at January 31, 2 019 13,648 $ 12.27 5.38 $ 507,371 Options exercised (2,634 ) 10.82 Options canceled/expired (25 ) 17.69 Outstanding at April 30, 201 9 10,989 $ 12.61 5.41 $ 484,184 Vested and expected to vest at April 30, 2019 10,852 $ 12.55 5.38 $ 478,824 Exercisable at April 30, 2019 9,418 $ 11.77 5.05 $ 422,811 As of April 30, 2019 , our total unrecognized compensation cost related to stock option grants was $11.0 million . We expect to recognize this expense over the remaining weighted-average period of approximately 1.6 years. RSUs Substantially all the RSUs that we have issued through January 31, 2018 vest upon the satisfaction of both service-based and performance-based vesting conditions. The service-based condition is typically satisfied over a four-year service period. The performance-based condition related to these awards was satisfied upon the effectiveness of our IPO Registration Statement on April 26, 2018. On that date we recorded a cumulative stock-based compensation expense of $262.8 million using the accelerated attribution method for all the RSUs with the service condition fully satisfied. In the year ended January 31, 2019, we granted 0.7 million RSUs that are subject to either performance-based or market-based vesting conditions and a service-based condition. The performance-based conditions will be satisfied if our financial performance meets certain operating targets. The market-based conditions will be satisfied if certain milestones based on our common stock price are met. All other RSUs granted after January 31, 2018 vest on the satisfaction of a service-based condition only. RSU activity for the three months ended April 30, 2019 , was as follows: (in thousands, except per share data) Number of Units Weighted-Average Grant Date Fair Value Unvested at January 31, 2019 17,142 $ 34.56 Granted 1,174 55.42 Vested (2,468 ) 20.72 Canceled (821 ) 37.23 Unvested at April 30, 2019 15,027 $ 38.32 As of April 30, 2019 , our total unrecognized compensation cost related to RSUs was $51.2 million . We expect to recognize this expense over the remaining weighted-average period of approximately 2.2 years. 2018 Employee Stock Purchase Plan Our 2018 Employee Stock Purchase Plan (“2018 ESPP”) allows eligible employees to contribute, normally through payroll deductions, up to 15% of their earnings for the purchase our common stock at a discounted price per share. The price at which common stock is purchased under the 2018 ESPP is equal to 85% of the fair market value of our common stock on the first or last day of the offering period, whichever is lower. The 2018 ESPP provides for separate six-month offering periods that begin on September 15 and March 15 each year. The initial offering period ran from September 15, 2018 through March 14, 2019. In the three months ended April 30, 2019 , 0.2 million shares of our common stock were purchased under the 2018 ESPP. Compensation expense related to the ESPP was $1.9 million for the three months ended April 30, 2019 . The number of shares reserved under the 2018 ESPP will automatically increase on the first day of each fiscal year, starting on February 1, 2019 and continuing through February 1, 2028, in an amount equal to the lesser of (i) 1% of the total number of shares of our common stock outstanding on January 31 of the preceding fiscal year, (ii) 3.8 million shares, or (iii) a lesser number of shares determined by our board of directors. As of April 30, 2019 , 5.3 million shares were reserved for future issuance under the 2018 ESPP. |
Net Loss per Share Attributable
Net Loss per Share Attributable to Common Stockholders | 3 Months Ended |
Apr. 30, 2019 | |
Earnings Per Share [Abstract] | |
Net Loss per Share Attributable to Common Stockholders | Net Loss per Share Attributable to Common Stockholders The following table presents the calculation of basic and diluted net loss per share attributable to common stockholders for periods presented: Three Months Ended April 30, (in thousands, except per share data) 2019 2018 Numerator: Net loss $ (45,722 ) $ (270,687 ) Less: preferred stock accretion — (353 ) Net loss attributable to common stockholders $ (45,722 ) $ (271,040 ) Denominator: Weighted-average common shares outstanding 172,101 36,334 Net loss per share attributable to common stockholders: Basic and diluted $ (0.27 ) $ (7.46 ) Outstanding potentially dilutive securities that were excluded from the diluted per share calculations because they would have been antidilutive are as follows: April 30, (in thousands) 2019 2018 Convertible preferred stock as-converted — 100,350 Stock options 10,989 18,477 Warrants to purchase convertible preferred stock — 22 RSUs 14,620 15,002 ESPP 288 — Total antidilutive securities 25,897 133,851 The table above does not include 0.4 million RSUs outstanding as of April 30, 2019 , as these RSUs are subject to operating and stock price targets that were not considered to be met as of the reporting period. |
Income Taxes
Income Taxes | 3 Months Ended |
Apr. 30, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Our tax provision or benefit from income taxes for interim periods is determined using an estimate of our annual effective tax rate, adjusted for discrete items, if any, that are taken into account in the relevant period. Each quarter, we update our estimate of the annual effective tax rate, and if our estimated tax rate changes, we make a cumulative adjustment. Our income tax provisions were $1.3 million and $0.7 million for the three months ended April 30, 2019 and 2018 . The increase in the tax provisions was primarily driven by higher foreign tax expenses, resulting from higher year-over-year earnings in certain foreign jurisdictions as we continue to scale our foreign operations to support our ongoing international growth. We review the likelihood that we will realize the benefit of our deferred tax assets and, therefore, the need for valuation allowances, on a quarterly basis. There is no corresponding income tax benefit recognized with respect to losses incurred and no corresponding income tax expense recognized with respect to earnings generated in jurisdictions with a valuation allowance. This causes variability in our effective tax rate. We maintain a valuation allowance against certain deferred tax assets, including all federal, state, and certain foreign deferred tax assets as a result of uncertainties regarding the realization of the asset balance due to historical losses, the variability of operating results, and uncertainty regarding near term projected results. In the event that we determine the deferred tax assets are realizable based on its assessment of relevant factors, an adjustment to the valuation allowance may increase income in the period such determination is made. As of April 30, 2019 , our gross uncertain tax benefits totaled $9.7 million , excluding related accrued interest and penalties, all of which would impact the effective tax rate if recognized. Our policy is to account for interest and penalties related to uncertain tax positions as a component of income tax provision. We do not expect to have any significant changes to unrecognized tax benefits during the next twelve months. We are subject to taxation in the U.S. and various state and foreign jurisdictions. Earnings from international activities are subject to local country income tax. The material jurisdictions where we are subject to potential examination by taxing authorities include the U.S., California and Israel. We are currently under an income tax examination by the Israel Tax Authority for tax years 2013 through 2016. We are not currently under audit by the Internal Revenue Service or any similar taxing authority in any other material jurisdiction. We believe that adequate amounts have been reserved in all jurisdictions. |
Geographic Information
Geographic Information | 3 Months Ended |
Apr. 30, 2019 | |
Segment Reporting [Abstract] | |
Geographic Information | Geographic Information We operate in one operating and one reportable segment as we only report financial information on an aggregate and consolidated basis to the Chief Executive Officer, who is our chief operating decision maker. Revenue by geography is generally based on the address of the customer as specified in our master subscription agreement. Revenue by geographic area were as follows: Three Months Ended April 30, (in thousands) 2019 2018 U.S. $ 176,266 $ 129,814 International 37,696 25,994 Total revenue $ 213,962 $ 155,808 No single country other than the U.S. had revenue greater than 10% of total revenue for the three months ended April 30, 2019 and 2018 . Our property and equipment by geographic area were as follows: (in thousands) April 30, 2019 January 31, 2019 U.S. $ 70,291 $ 60,625 International 13,803 15,207 Total property and equipment $ 84,094 $ 75,832 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Apr. 30, 2019 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Our condensed consolidated financial statements include the accounts of DocuSign, Inc. and our wholly-owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. |
Basis of Presentation | Our condensed consolidated financial statements have been prepared in accordance with United States ("U.S.") generally accepted accounting principles (“GAAP”) for interim financial information. Certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to the applicable rules and regulations of the Securities and Exchange Commission (“SEC”). Therefore, these unaudited interim consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes included in our 2019 Annual Report on Form 10-K. Our condensed consolidated financial statements are unaudited and have been prepared on a basis consistent with that used to prepare the audited annual consolidated financial statements and, in our opinion, include all adjustments of a normal recurring nature necessary for the fair statement of our financial position, results of operations and cash flows. Our condensed consolidated balance sheet as of January 31, 2019 was derived from audited financial statements but does not include all disclosures required by GAAP. The results of operations for the three months ended April 30, 2019 are not necessarily indicative of the results to be expected for the year ending January 31, 2020 . |
Fiscal Year | Our fiscal year ends on January 31. References to fiscal 2020 , for example, are to the fiscal year ending January 31, 2020 . |
Use of Estimates | The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant items subject to such estimates and assumptions include those related to the allocation of revenue between recognized and deferred amounts, allowance for bad debts, goodwill, intangible assets, deferred contract acquisition costs, customer benefit period, fair value of financial instruments, valuation of stock-based compensation, valuation of common stock, f air value of the liability and equity components of the convertible notes, whether an arrangement is or contains a lease, the discount rate used for operating leases, and the valuation allowance for deferred income taxes. |
Recently Adopted Accounting Pronouncements and Other Recent Accounting Pronouncements | In February 2016, the Financial Accounting Standards Board (the "FASB") issued accounting standards update ("ASU") No. 2016-02, Leases (Topic 842), which supersedes current guidance related to accounting for leases. This guidance is intended to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. In July 2018, the FASB issued ASU No. 2018-10, Codification Improvements to Topic 842, Leases. The ASU makes 16 technical corrections to the new leases standard and other accounting topics, alleviating unintended consequences from applying the new standard. It does not make any substantive changes to the core provisions or principles of the new standard. In July 2018, the FASB also issued ASU No. 2018-11, Leases (Topic 842). The ASU provides (1) an optional transition method that entities can use when adopting the standard and (2) a practical expedient that permits lessors to not separate nonlease components from the associated lease component if certain conditions are met. The standard is effective for public entities for annual and interim reporting periods beginning after December 15, 2018. We adopted the new standard as of February 1, 2019, and recognized a cumulative-effect adjustment to the opening balance of accumulated deficit as of the adoption date. We elected the optional transition approach to not apply Topic 842 in the comparative periods presented. We elected the practical expedient to use hindsight when determining the lease term and the package of practical expedients to not reassess whether existing contracts contain leases, the lease classification for existing leases and whether existing initial direct costs meet the new definition. The adoption of Topic 842 resulted in the recognition of total right-of-use assets of $93.9 million and total lease liabilities of $121.8 million as of adoption date, with the most significant impact related to our office space leases. Additionally, we derecognized $26.6 million in deferred rent and $2.5 million related to the build-to-suit asset and liability upon adoption of this standard pursuant to the transition guidance provided for build-to-suit leases. The adoption of Topic 842 did not have a material impact to the consolidated statements of operations or statements of cash flows. In February 2018, the FASB issued ASU No. 2018-02, Income Statement—Reporting Comprehensive Income (Topic 220), which allows a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act ("TCJA"). As the amendment only relates to the reclassification of the income tax effects of the TCJA, the underlying guidance that requires that the effect of a change in tax laws or rates be included in income from continuing operations is not affected. The standard is effective for annual and interim reporting periods beginning after December 15, 2018 for all entities. The amendment is to be applied either in the period of adoption or retrospectively to each period in which the effect of the change in the U.S. federal corporate income tax rate in the TCJA is recognized. Early adoption is permitted. The adoption of the standard did not have an impact on our consolidated financial statements. In June 2018, the FASB issued ASU No. 2018-07, Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting. The ASU aligns the measurement and classification guidance for share-based payments to nonemployees with the guidance for share-based payments to employees, with certain exceptions. Under the guidance, the measurement of equity-classified nonemployee awards will be fixed at the grant date. The ASU is effective for public business entities in annual periods beginning after December 15, 2018, and interim periods within those years. Early adoption is permitted, including in an interim period, but not before an entity adopts the topic 606 revenue guidance. The adoption of the standard did not have a material impact on our consolidated financial statements. In July 2018, the FASB issued ASU No. 2018-09, Codification Improvements, which clarifies, corrects errors in and makes improvements to several topics in the FASB Accounting Standard Codification. The transition and effective date guidance is based on the facts and circumstances of each amendment. Some of the amendments do not require transition guidance and were effective upon issuance of the ASU. Amendments that do have transition guidance are effective for public business entities for annual periods beginning after December 15, 2018. The adoption of the standard did not have a material impact on our consolidated financial statements. Other Recent Accounting Pronouncements In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments — Credit Losses (Topic 326). ASU 2016-13 changes the impairment model for most financial assets and will require the use of an expected loss model in place of the currently used incurred loss method. Under this model, entities will be required to estimate the lifetime expected credit loss on such instruments and record an allowance to offset the amortized cost basis of the financial asset, resulting in a net presentation of the amount expected to be collected on the financial asset. The update to the standard is effective for interim and annual periods beginning after December 15, 2019. We are evaluating the impact of the adoption of the ASU on our consolidated financial statements. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820), which modifies, removes and adds certain disclosure requirements on fair value measurements based on the FASB Concepts Statement, Conceptual Framework for Financial Reporting—Chapter 8: Notes to Financial Statements . The ASU is effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. The amendments on changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements and the narrative description of measurement uncertainty should be applied prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption. All other amendments should be applied retrospectively to all periods presented upon their effective date. Early adoption is permitted. We are in the process of evaluating the impact of the adoption of the ASU on our consolidated financial statements. In August 2018, the FASB issued ASU No. 2018-15, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40), which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal use software license). The accounting for the service element of a hosting arrangement that is a service contract is not affected by the amendments in this ASU. The amendments in this update are effective for public business entities for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. Early adoption is permitted. We are in the process of evaluating the impact of the adoption of the ASU on our consolidated financial statements. |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Apr. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Summary of assets and liabilities measured at fair value on a recurring basis | The following table summarizes our financial assets that are measured at fair value on a recurring basis during the period: April 30, 2019 (in thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Level 1: Cash equivalents Money market funds $ 91,330 $ — $ — $ 91,330 Level 2: Cash equivalents Commercial paper 4,998 — — 4,998 Available-for-sale securities Commercial paper 62,695 31 (8 ) 62,718 Corporate notes and bonds 334,912 582 (34 ) 335,460 U.S. Treasury securities 232,152 32 (15 ) 232,169 U.S. government agency securities 69,977 12 (5 ) 69,984 Level 2 total 704,734 657 (62 ) 705,329 Total $ 796,064 $ 657 $ (62 ) $ 796,659 January 31, 2019 (in thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Level 1: Cash equivalents Money market funds $ 350,063 $ — $ — $ 350,063 Level 2: Cash equivalents Commercial paper 76,828 — (11 ) 76,817 Corporate notes and bonds 2,998 — — 2,998 U.S. government agency securities 6,491 — — 6,491 Available-for-sale securities Commercial paper 86,655 4 (21 ) 86,638 Corporate notes and bonds 287,496 389 (105 ) 287,780 U.S. Treasury securities 4,982 — (1 ) 4,981 U.S. government agency securities 36,021 7 (4 ) 36,024 Level 2 total 501,471 400 (142 ) 501,729 Total $ 851,534 $ 400 $ (142 ) $ 851,792 |
Fair value of available-for-sale marketable securities by remaining contractual maturities | The fair value of our available-for-sale marketable securities as of April 30, 2019 , by remaining contractual maturities, were as follows (in thousands): Due in one year or less $ 515,648 Due in one to two years 184,683 $ 700,331 |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 3 Months Ended |
Apr. 30, 2019 | |
Property, Plant and Equipment [Abstract] | |
Property and equipment | Property and equipment consisted of the following: (in thousands) April 30, 2019 January 31, 2019 Computer and network equipment $ 55,107 $ 55,233 Software, including capitalized software development costs 30,477 27,959 Furniture and office equipment 11,587 9,511 Leasehold improvements 43,477 41,464 140,648 134,167 Less: Accumulated depreciation (70,448 ) (66,479 ) 70,200 67,688 Work in progress 13,894 8,144 $ 84,094 $ 75,832 |
Acquisition of SpringCM Inc. (T
Acquisition of SpringCM Inc. (Tables) | 3 Months Ended |
Apr. 30, 2019 | |
Business Combinations [Abstract] | |
Schedule of assets acquired and liabilities assumed | The following table summarizes the acquisition date fair values of assets acquired and liabilities assumed at the date of acquisition: (in thousands) September 4, 2018 Cash and cash equivalents $ 6,950 Accounts receivable and other assets 10,542 Property and equipment 6,108 Goodwill 159,097 Intangible assets 73,000 Contract liabilities (9,973 ) Other liabilities (12,948 ) Deferred tax liability (7,047 ) $ 225,729 |
Schedule of identifiable intangible assets estimated useful lives | The estimated useful lives, primarily based on the expected period of benefit to us, and fair values of the identifiable intangible assets at acquisition date were as follows: (in thousands, except years) Estimated Fair Value Expected Useful Life Existing technology $ 11,900 3 years Customer relationships—subscription 54,200 9 years Backlog—subscription 6,400 2 years Tradenames / trademarks 500 1 year Total preliminary intangible assets $ 73,000 |
Schedule of unaudited pro forma results | The unaudited pro forma results have been prepared based on estimates and assumptions, which we believe are reasonable, however, they are not necessarily indicative of the consolidated results of operations had the acquisition occurred on February 1, 2017, or of future results of operations: (in thousands, except per share data) April 30, 2018 Revenue $ 162,104 Net loss (280,642 ) Net loss per share attributable to common stockholders, basic and diluted (7.72 ) |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets, Net (Tables) | 3 Months Ended |
Apr. 30, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Carrying amount of goodwill | The changes in the carrying amount of goodwill for the three months ended April 30, 2019 were as follows (in thousands): Balance at January 31, 2019 $ 195,225 Cumulative translation adjustment (450 ) Balance at April 30, 2019 $ 194,775 |
Intangible assets | Intangible assets consisted of the following: As of April 30, 2019 As of January 31, 2019 (in thousands) Weighted-average Remaining Useful Life (Years) Estimated Fair Value Accumulated Amortization Acquisition-related Intangibles, Net Estimated Fair Value Accumulated Amortization Acquisition-related Intangibles, Net Existing technology 2.4 $ 31,594 $ (22,053 ) $ 9,541 $ 31,594 $ (20,747 ) $ 10,847 Tradenames / trademarks 0.7 2,419 (2,048 ) 371 2,419 (1,858 ) 561 Customer contracts & related relationships 8.1 65,782 (13,185 ) 52,597 65,782 (11,168 ) 54,614 Certifications 1.3 6,917 (5,191 ) 1,726 6,917 (4,846 ) 2,071 Maintenance contracts & related relationships 1.1 1,498 (1,179 ) 319 1,498 (1,104 ) 394 Backlog—Subscription 1.4 6,400 (2,104 ) 4,296 6,400 (1,304 ) 5,096 6.6 $ 114,610 $ (45,760 ) 68,850 $ 114,610 $ (41,027 ) 73,583 Cumulative translation adjustment 640 620 Total $ 69,490 $ 74,203 |
Amortization of finite-lived intangible assets | Amortization of finite-lived intangible assets for the three months ended April 30, 2019 and 2018 was as follows: Three Months Ended April 30, (in thousands) 2019 2018 Cost of subscription revenue $ 1,627 $ 1,668 Sales and marketing 3,106 765 Total $ 4,733 $ 2,433 |
Future amortization of finite-lived intangibles | As of April 30, 2019 , future amortization of finite-lived intangibles that will be recorded in cost of revenue and operating expenses is estimated as follows, excluding cumulative translation adjustment (in thousands): Fiscal 2020, remainder $ 12,984 Fiscal 2021 13,818 Fiscal 2022 8,370 Fiscal 2023 6,023 Fiscal 2024 6,023 Thereafter 21,632 Total $ 68,850 |
Deferred Contract Acquisition_2
Deferred Contract Acquisition and Fulfillment Costs (Tables) | 3 Months Ended |
Apr. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Deferred contract costs | The following table represents a rollforward of our deferred contract acquisition costs: Three Months Ended April 30, (in thousands) 2019 2018 Beginning balance $ 115,985 $ 77,344 Additions to deferred contract acquisition costs 17,401 11,969 Amortization of deferred contract acquisition costs (13,150 ) (8,788 ) Cumulative translation adjustment (1,103 ) — Ending balance $ 119,133 $ 80,525 Deferred contract acquisition costs, current $ 3,209 $ 2,124 Deferred contract acquisitions costs, noncurrent 115,924 78,401 Total $ 119,133 $ 80,525 The following table represents our contract fulfillment costs, which include third-party service fees: Three Months Ended April 30, (in thousands) 2019 2018 Beginning balance $ 3,432 $ 3,316 Additions to deferred contract fulfillment costs 3,086 357 Amortization of deferred contract fulfillment costs (1,110 ) (458 ) Ending balance $ 5,408 $ 3,215 Deferred contract fulfillment costs, current $ 2,493 $ 1,188 Deferred contract fulfillment costs, noncurrent 2,915 2,027 Total $ 5,408 $ 3,215 |
Convertible Senior Notes (Table
Convertible Senior Notes (Tables) | 3 Months Ended |
Apr. 30, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of convertible debt | The net carrying value of the liability component of the Notes was as follows: (in thousands) April 30, 2019 Principal $ 575,000 Less: unamortized debt discount (119,903 ) Less: unamortized transaction costs (9,712 ) Net carrying amount $ 445,385 The net carrying amount of the equity component of the Notes was as follows: (in thousands) April 30, 2019 Proceeds allocated to the conversion option (debt discount) $ 134,667 Less: transaction costs (3,336 ) Net carrying amount $ 131,331 The interest expense recognized related to the Notes was as follows: (in thousands) Three Months Ended April 30, 2019 Contractual interest expense $ 710 Amortization of debt discount 484 Amortization of transaction costs 5,970 Total $ 7,164 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Apr. 30, 2019 | |
Leases [Abstract] | |
Operating lease costs | The following table is a summary of our operating lease costs for the three months ended April 30, 2019 , (in thousands, except years and rates): Three Months Ended April 30, 2019 Operating lease cost $ 5,706 Short-term lease cost 269 Variable lease cost and other, net 49 Total lease cost $ 6,024 Weighted average remaining term (years) 8.3 Weighted average discount rate 4.4 % |
Future lease payments | Future lease payments as of April 30, 2019 were as follows (in thousands): Fiscal 2020, remainder $ 16,872 Fiscal 2021 26,319 Fiscal 2022 27,285 Fiscal 2023 27,724 Fiscal 2024 27,834 Thereafter 79,580 Total undiscounted cash flows $ 205,614 Less imputed interest (33,915 ) Present value of lease liabilities $ 171,699 |
Future minimum annual lease payments | The future minimum annual lease payments as of January 31, 2019 , related to the outstanding lease agreements were as follows (in thousands): Fiscal 2020 $ 22,198 Fiscal 2021 22,617 Fiscal 2022 22,556 Fiscal 2023 23,173 Fiscal 2024 23,373 Thereafter 34,634 Total minimum lease payments $ 148,551 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 3 Months Ended |
Apr. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of noncancelable contractual obligations | As of April 30, 2019 , our noncancelable contractual obligations with a remaining term of more than one year were as follows (in thousands): Fiscal 2020, remainder $ 6,142 Fiscal 2021 10,987 Fiscal 2022 9,379 Fiscal 2023 898 Fiscal 2024 943 Thereafter 4,555 Total $ 32,904 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 3 Months Ended |
Apr. 30, 2019 | |
Equity [Abstract] | |
Stock option activity | Option activity for the three months ended April 30, 2019 , was as follows: (in thousands, except per share and years data) Number of Options Outstanding Weighted-Average Exercise Price Per Share Weighted-Average Remaining Contractual Term (Years) Aggregate Intrinsic Value Outstanding at January 31, 2 019 13,648 $ 12.27 5.38 $ 507,371 Options exercised (2,634 ) 10.82 Options canceled/expired (25 ) 17.69 Outstanding at April 30, 201 9 10,989 $ 12.61 5.41 $ 484,184 Vested and expected to vest at April 30, 2019 10,852 $ 12.55 5.38 $ 478,824 Exercisable at April 30, 2019 9,418 $ 11.77 5.05 $ 422,811 |
RSU activity | RSU activity for the three months ended April 30, 2019 , was as follows: (in thousands, except per share data) Number of Units Weighted-Average Grant Date Fair Value Unvested at January 31, 2019 17,142 $ 34.56 Granted 1,174 55.42 Vested (2,468 ) 20.72 Canceled (821 ) 37.23 Unvested at April 30, 2019 15,027 $ 38.32 |
Net Loss per Share Attributab_2
Net Loss per Share Attributable to Common Stockholders (Tables) | 3 Months Ended |
Apr. 30, 2019 | |
Earnings Per Share [Abstract] | |
Calculation of basic and diluted loss per share | The following table presents the calculation of basic and diluted net loss per share attributable to common stockholders for periods presented: Three Months Ended April 30, (in thousands, except per share data) 2019 2018 Numerator: Net loss $ (45,722 ) $ (270,687 ) Less: preferred stock accretion — (353 ) Net loss attributable to common stockholders $ (45,722 ) $ (271,040 ) Denominator: Weighted-average common shares outstanding 172,101 36,334 Net loss per share attributable to common stockholders: Basic and diluted $ (0.27 ) $ (7.46 ) |
Antidilutive securities | Outstanding potentially dilutive securities that were excluded from the diluted per share calculations because they would have been antidilutive are as follows: April 30, (in thousands) 2019 2018 Convertible preferred stock as-converted — 100,350 Stock options 10,989 18,477 Warrants to purchase convertible preferred stock — 22 RSUs 14,620 15,002 ESPP 288 — Total antidilutive securities 25,897 133,851 |
Geographic Information (Tables)
Geographic Information (Tables) | 3 Months Ended |
Apr. 30, 2019 | |
Segment Reporting [Abstract] | |
Revenues by geographic area | Revenue by geographic area were as follows: Three Months Ended April 30, (in thousands) 2019 2018 U.S. $ 176,266 $ 129,814 International 37,696 25,994 Total revenue $ 213,962 $ 155,808 |
Property and equipment by geographic area | Our property and equipment by geographic area were as follows: (in thousands) April 30, 2019 January 31, 2019 U.S. $ 70,291 $ 60,625 International 13,803 15,207 Total property and equipment $ 84,094 $ 75,832 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies - Narrative (Details) - USD ($) | Apr. 30, 2019 | Mar. 31, 2019 | Feb. 01, 2019 | Jan. 31, 2019 |
Accounting Policies [Abstract] | ||||
Equity investments in privately-held companies | $ 15,500,000 | $ 0 | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Operating lease right-of-use assets | $ 143,361,000 | |||
Operating lease liabilities | 171,699,000 | |||
Derecognition related to build-to-suit asset | (84,094,000) | $ (75,832,000) | ||
Accounting Standards Update 2016-02 | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Operating lease right-of-use assets | $ 93,900,000 | |||
Operating lease liabilities | 121,800,000 | |||
Deferred rent | 26,600,000 | |||
Israel Leased Property | Other Capitalized Property Plant and Equipment | Accounting Standards Update 2016-02 | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Derecognition related to build-to-suit asset | $ 2,500,000 | |||
Derecognition related to build-to-suit liability | $ 2,500,000 |
Revenue and Performance Oblig_2
Revenue and Performance Obligations - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 30, 2019 | Apr. 30, 2018 | |
Disaggregation of Revenue [Line Items] | ||
Remaining performance obligations | $ 574 | |
Subscription | Minimum | ||
Disaggregation of Revenue [Line Items] | ||
Contract term | 1 year | |
Subscription | Maximum | ||
Disaggregation of Revenue [Line Items] | ||
Contract term | 3 years | |
Product concentration risk | Revenue | Subscription | ||
Disaggregation of Revenue [Line Items] | ||
Concentration risk percentage | 94.00% | 95.00% |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Thousands | Apr. 30, 2019 | Jan. 31, 2019 |
Cash equivalents | ||
Amortized Cost | $ 236,476 | $ 517,811 |
Available-for-sale securities | ||
Gross Unrealized Gains | 657 | 400 |
Estimated Fair Value | 700,331 | |
Total | ||
Amortized Cost | 796,064 | 851,534 |
Gross Unrealized Losses | (62) | (142) |
Estimated Fair Value | 796,659 | 851,792 |
Level 2 | ||
Available-for-sale securities | ||
Amortized Cost | 704,734 | 501,471 |
Gross Unrealized Gains | 657 | 400 |
Gross Unrealized Losses | (62) | (142) |
Estimated Fair Value | 705,329 | 501,729 |
Commercial paper | Level 2 | ||
Available-for-sale securities | ||
Amortized Cost | 62,695 | 86,655 |
Gross Unrealized Gains | 31 | 4 |
Gross Unrealized Losses | (8) | (21) |
Estimated Fair Value | 62,718 | 86,638 |
Corporate notes and bonds | Level 2 | ||
Available-for-sale securities | ||
Amortized Cost | 334,912 | 287,496 |
Gross Unrealized Gains | 582 | 389 |
Gross Unrealized Losses | (34) | (105) |
Estimated Fair Value | 335,460 | 287,780 |
U.S. Treasury securities | Level 2 | ||
Available-for-sale securities | ||
Amortized Cost | 232,152 | 4,982 |
Gross Unrealized Gains | 32 | 0 |
Gross Unrealized Losses | (15) | (1) |
Estimated Fair Value | 232,169 | 4,981 |
U.S. government agency securities | Level 2 | ||
Available-for-sale securities | ||
Amortized Cost | 69,977 | 36,021 |
Gross Unrealized Gains | 12 | 7 |
Gross Unrealized Losses | (5) | (4) |
Estimated Fair Value | 69,984 | 36,024 |
Money market funds | Level 1 | ||
Cash equivalents | ||
Amortized Cost | 91,330 | 350,063 |
Estimated Fair Value | 91,330 | 350,063 |
Commercial paper | Level 2 | ||
Cash equivalents | ||
Amortized Cost | 4,998 | 76,828 |
Gross Unrealized Losses | 0 | (11) |
Estimated Fair Value | $ 4,998 | 76,817 |
Corporate notes and bonds | Level 2 | ||
Cash equivalents | ||
Amortized Cost | 2,998 | |
Estimated Fair Value | 2,998 | |
U.S. government agency securities | Level 2 | ||
Cash equivalents | ||
Amortized Cost | 6,491 | |
Estimated Fair Value | $ 6,491 |
Revenue and Performance Oblig_3
Revenue and Performance Obligations - Remaining Performance Obligations (Details) | Apr. 30, 2019 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2018-10-31 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation, percentage | 53.00% |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-05-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligations, period of recognition | 1 year |
Fair Value Measurements - Fair
Fair Value Measurements - Fair Value of Available-for-Sale Marketable Securities by Remaining Contractual Maturities (Details) $ in Thousands | Apr. 30, 2019USD ($) |
Fair Value Disclosures [Abstract] | |
Due in one year or less | $ 515,648 |
Due in one to two years | 184,683 |
Total available-for-sale securities | $ 700,331 |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) | Apr. 30, 2019USD ($)security | Sep. 30, 2018USD ($) |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Number of available-for-sale securities | security | 155 | |
Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of debt | $ 615,400,000 | |
Convertible Debt | Convertible Senior Notes Due 2023 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt interest rate percentage | 0.50% | |
Aggregate principal amount of debt issued | $ 575,000,000 | $ 575,000,000 |
Property and Equipment, Net (De
Property and Equipment, Net (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Apr. 30, 2019 | Apr. 30, 2018 | Jan. 31, 2019 | |
Property, Plant and Equipment [Line Items] | |||
Property and equipment, net | $ 84,094 | $ 75,832 | |
Depreciation expense | 7,200 | $ 6,200 | |
Computer and network equipment | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | 55,107 | 55,233 | |
Software, including capitalized software development costs | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | 30,477 | 27,959 | |
Furniture and office equipment | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | 11,587 | 9,511 | |
Leasehold improvements | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | 43,477 | 41,464 | |
Property and equipment, excluding work in progress | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | 140,648 | 134,167 | |
Less: Accumulated depreciation | (70,448) | (66,479) | |
Property and equipment, net | 70,200 | 67,688 | |
Work in progress | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, net | $ 13,894 | 8,144 | |
Israel Leased Property | Leasehold improvements | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, net | $ 2,500 |
Acquisition of SpringCM Inc. -
Acquisition of SpringCM Inc. - Narrative (Details) - SpringCM Inc. - USD ($) shares in Millions, $ in Millions | Sep. 04, 2018 | Apr. 30, 2019 | Jan. 31, 2019 |
Business Acquisition [Line Items] | |||
Cash paid, excluding cash acquired | $ 218.8 | ||
Portion of cash paid held in escrow | $ 8.2 | ||
Period of time held in escrow | 18 months | ||
Acquisition costs | $ 1.8 | ||
RSUs with vesting conditions | |||
Business Acquisition [Line Items] | |||
Shares granted to employees (in shares) | 0.5 |
Acquisition of SpringCM Inc. _2
Acquisition of SpringCM Inc. - Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands | Apr. 30, 2019 | Jan. 31, 2019 | Sep. 04, 2018 |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net [Abstract] | |||
Goodwill | $ 194,775 | $ 195,225 | |
SpringCM Inc. | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net [Abstract] | |||
Cash and cash equivalents | $ 6,950 | ||
Accounts receivable and other assets | 10,542 | ||
Property and equipment | 6,108 | ||
Goodwill | 159,097 | ||
Intangible assets | 73,000 | ||
Contract liabilities | (9,973) | ||
Other liabilities | (12,948) | ||
Deferred tax liability | (7,047) | ||
Total assets acquired and liabilities assumed | $ 225,729 |
Acquisition of SpringCM Inc. _3
Acquisition of SpringCM Inc. - Intangible Assets Acquired (Details) - SpringCM Inc. $ in Thousands | Sep. 04, 2018USD ($) |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Estimated Fair Value | $ 73,000 |
Existing technology | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Estimated Fair Value | $ 11,900 |
Expected Useful Life | 3 years |
Customer relationships—subscription | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Estimated Fair Value | $ 54,200 |
Expected Useful Life | 9 years |
Backlog—subscription | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Estimated Fair Value | $ 6,400 |
Expected Useful Life | 2 years |
Tradenames / trademarks | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Estimated Fair Value | $ 500 |
Expected Useful Life | 1 year |
Acquisition of SpringCM Inc. _4
Acquisition of SpringCM Inc. - Pro Forma Results (Details) $ / shares in Units, $ in Thousands | 3 Months Ended |
Apr. 30, 2018USD ($)$ / shares | |
Business Acquisition, Pro Forma Information [Abstract] | |
Revenue | $ 162,104 |
Net loss | $ (280,642) |
Net loss per share attributable to common stockholders, basic and diluted (in usd per share) | $ / shares | $ (7.72) |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets, Net - Goodwill (Details) $ in Thousands | 3 Months Ended |
Apr. 30, 2019USD ($) | |
Goodwill [Roll Forward] | |
Balance at January 31, 2019 | $ 195,225 |
Cumulative translation adjustment | (450) |
Balance at April 30, 2019 | $ 194,775 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets, Net - Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 30, 2019 | Jan. 31, 2019 | |
Finite-Lived Intangible Assets, Net [Abstract] | ||
Weighted-average Remaining Useful Life (Years) | 6 years 7 months 6 days | |
Estimated Fair Value | $ 114,610 | $ 114,610 |
Accumulated Amortization | (45,760) | (41,027) |
Acquisition-related intangibles, net, excluding cumulative translation adjustment | 68,850 | 73,583 |
Cumulative translation adjustment | 640 | 620 |
Acquisition-related Intangibles, Net | $ 69,490 | 74,203 |
Existing technology | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Weighted-average Remaining Useful Life (Years) | 2 years 4 months 24 days | |
Estimated Fair Value | $ 31,594 | 31,594 |
Accumulated Amortization | (22,053) | (20,747) |
Acquisition-related intangibles, net, excluding cumulative translation adjustment | $ 9,541 | 10,847 |
Tradenames / trademarks | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Weighted-average Remaining Useful Life (Years) | 8 months 12 days | |
Estimated Fair Value | $ 2,419 | 2,419 |
Accumulated Amortization | (2,048) | (1,858) |
Acquisition-related intangibles, net, excluding cumulative translation adjustment | $ 371 | 561 |
Customer contracts & related relationships | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Weighted-average Remaining Useful Life (Years) | 8 years 1 month 6 days | |
Estimated Fair Value | $ 65,782 | 65,782 |
Accumulated Amortization | (13,185) | (11,168) |
Acquisition-related intangibles, net, excluding cumulative translation adjustment | $ 52,597 | 54,614 |
Certifications | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Weighted-average Remaining Useful Life (Years) | 1 year 3 months 18 days | |
Estimated Fair Value | $ 6,917 | 6,917 |
Accumulated Amortization | (5,191) | (4,846) |
Acquisition-related intangibles, net, excluding cumulative translation adjustment | $ 1,726 | 2,071 |
Maintenance contracts & related relationships | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Weighted-average Remaining Useful Life (Years) | 1 year 1 month 6 days | |
Estimated Fair Value | $ 1,498 | 1,498 |
Accumulated Amortization | (1,179) | (1,104) |
Acquisition-related intangibles, net, excluding cumulative translation adjustment | $ 319 | 394 |
Backlog—Subscription | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Weighted-average Remaining Useful Life (Years) | 1 year 4 months 24 days | |
Estimated Fair Value | $ 6,400 | 6,400 |
Accumulated Amortization | (2,104) | (1,304) |
Acquisition-related intangibles, net, excluding cumulative translation adjustment | $ 4,296 | $ 5,096 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets, Net - Amortization (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 30, 2019 | Apr. 30, 2018 | |
Finite-Lived Intangible Assets [Line Items] | ||
Amortization of finite-lived intangible assets | $ 4,733 | $ 2,433 |
Cost of subscription revenue | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization of finite-lived intangible assets | 1,627 | 1,668 |
Sales and marketing | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization of finite-lived intangible assets | $ 3,106 | $ 765 |
Goodwill and Intangible Asset_6
Goodwill and Intangible Assets, Net - Future Amortization (Details) - USD ($) $ in Thousands | Apr. 30, 2019 | Jan. 31, 2019 |
Finite-Lived Intangible Assets, Amortization Expense, Maturity Schedule [Abstract] | ||
Fiscal 2020, remainder | $ 12,984 | |
Fiscal 2021 | 13,818 | |
Fiscal 2022 | 8,370 | |
Fiscal 2023 | 6,023 | |
Fiscal 2024 | 6,023 | |
Thereafter | 21,632 | |
Acquisition-related intangibles, net, excluding cumulative translation adjustment | $ 68,850 | $ 73,583 |
Contract Balances (Details)
Contract Balances (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Apr. 30, 2019 | Apr. 30, 2018 | Jan. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |||
Contract assets | $ 14.6 | $ 11.9 | |
Contract assets, noncurrent | 1.3 | $ 1.3 | |
Revenue recognized that was included in contract liability balance at the beginning of the period | $ 157 | $ 112 | |
Payment term | 30 days |
Deferred Contract Acquisition_3
Deferred Contract Acquisition and Fulfillment Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | ||||
Apr. 30, 2019 | Apr. 30, 2018 | Apr. 30, 2019 | Jan. 31, 2019 | Apr. 30, 2018 | |
Capitalized Contract Cost, Net [Roll Forward] | |||||
Amortization of deferred contract acquisition costs | $ (14,260) | $ (9,246) | |||
Cumulative translation adjustment | (1,103) | 0 | |||
Deferred contract acquisitions costs, noncurrent | $ 115,924 | $ 112,583 | |||
Contract acquisition costs | |||||
Capitalized Contract Cost, Net [Roll Forward] | |||||
Beginning balance | 115,985 | 77,344 | |||
Additions to deferred contract acquisition costs | 17,401 | 11,969 | |||
Amortization of deferred contract acquisition costs | (13,150) | (8,788) | |||
Ending balance | 119,133 | 80,525 | |||
Deferred contract acquisition costs, current | 3,209 | $ 2,124 | |||
Deferred contract acquisitions costs, noncurrent | 115,924 | 78,401 | |||
Total | 115,985 | 77,344 | 119,133 | 115,985 | 80,525 |
Contract fulfillment costs | |||||
Capitalized Contract Cost, Net [Roll Forward] | |||||
Beginning balance | 3,432 | 3,316 | |||
Additions to deferred contract acquisition costs | 3,086 | 357 | |||
Amortization of deferred contract acquisition costs | (1,110) | (458) | |||
Ending balance | 5,408 | 3,215 | |||
Deferred contract acquisition costs, current | 2,493 | 1,188 | |||
Deferred contract acquisitions costs, noncurrent | 2,915 | 2,027 | |||
Total | $ 3,432 | $ 3,316 | $ 5,408 | $ 3,432 | $ 3,215 |
Convertible Senior Notes - Narr
Convertible Senior Notes - Narrative (Details) $ / shares in Units, shares in Millions | 1 Months Ended | |
Sep. 30, 2018USD ($)trading_day$ / sharesshares | Apr. 30, 2019USD ($) | |
Convertible Senior Notes Due 2023 | Convertible Debt | ||
Debt Conversion [Line Items] | ||
Aggregate principal amount of debt issued | $ 575,000,000 | $ 575,000,000 |
Debt interest rate percentage | 0.50% | |
Additional principal amount purchased | 75,000,000 | |
Proceeds from issuance of debt | $ 560,800,000 | |
Conversion rate | 0.013986 | |
Conversion price (in usd per share) | $ / shares | $ 71.50 | |
Percentage of principal amount redeemed | 100.00% | |
Trading days | trading_day | 20 | |
Consecutive trading days | trading_day | 30 | |
Percentage of conversion price | 130.00% | |
Equity component of conversion option | $ 134,667,000 | |
Transaction costs attributable to liability component | 10,900,000 | |
Transaction costs attributable to equity components | $ 3,336,000 | |
Capped Calls | ||
Debt Conversion [Line Items] | ||
Conversion price (in usd per share) | $ / shares | $ 71.50 | |
Initial cap price (in usd per share) | $ / shares | $ 110 | |
Shares covered by capped calls (in shares) | shares | 8 | |
Costs incurred for capped calls | $ 67,600,000 | |
Conversion Covenant One | Convertible Senior Notes Due 2023 | Convertible Debt | ||
Debt Conversion [Line Items] | ||
Trading days | trading_day | 20 | |
Consecutive trading days | trading_day | 30 | |
Percentage of conversion price | 130.00% | |
Conversion Covenant Two | Convertible Senior Notes Due 2023 | Convertible Debt | ||
Debt Conversion [Line Items] | ||
Trading days | trading_day | 5 | |
Consecutive trading days | trading_day | 10 | |
Percentage of conversion price | 98.00% | |
Measurement Input, Discount Rate | Convertible Senior Notes Due 2023 | Convertible Debt | ||
Debt Conversion [Line Items] | ||
Discount rate | 0.06 |
Convertible Senior Notes - Carr
Convertible Senior Notes - Carrying Value of Liability Component (Details) - Convertible Senior Notes Due 2023 - Convertible Debt $ in Thousands | Apr. 30, 2019USD ($) |
Debt Instrument [Line Items] | |
Principal | $ 575,000 |
Less: unamortized debt discount | (119,903) |
Less: unamortized transaction costs | (9,712) |
Net carrying amount | $ 445,385 |
Convertible Senior Notes - Ca_2
Convertible Senior Notes - Carrying Amount of Equity Component (Details) - Convertible Debt - Convertible Senior Notes Due 2023 $ in Thousands | Apr. 30, 2019USD ($) |
Debt Instrument [Line Items] | |
Proceeds allocated to the conversion option (debt discount) | $ 134,667 |
Less: transaction costs | (3,336) |
Net carrying amount | $ 131,331 |
Convertible Senior Notes - Inte
Convertible Senior Notes - Interest Expense (Details) - Convertible Debt - Convertible Senior Notes Due 2023 $ in Thousands | 3 Months Ended |
Apr. 30, 2019USD ($) | |
Debt Instrument [Line Items] | |
Contractual interest expense | $ 710 |
Amortization of debt discount | 484 |
Amortization of transaction costs | 5,970 |
Total | $ 7,164 |
Leases - Narrative (Details)
Leases - Narrative (Details) | Apr. 30, 2019contract |
Leases [Abstract] | |
Number of lease contracts | 0 |
Leases - Operating Lease Costs
Leases - Operating Lease Costs (Details) $ in Thousands | 3 Months Ended |
Apr. 30, 2019USD ($) | |
Leases [Abstract] | |
Operating lease cost | $ 5,706 |
Short-term lease cost | 269 |
Variable lease cost and other, net | 49 |
Total lease cost | $ 6,024 |
Weighted average remaining term (years) | 8 years 3 months 18 days |
Weighted average discount rate | 4.40% |
Leases - Future Lease Payments
Leases - Future Lease Payments (Details) - USD ($) $ in Thousands | Apr. 30, 2019 | Jan. 31, 2019 |
Future lease payments due: | ||
Fiscal 2020, remainder | $ 16,872 | |
Fiscal 2021 | 26,319 | |
Fiscal 2022 | 27,285 | |
Fiscal 2023 | 27,724 | |
Fiscal 2024 | 27,834 | |
Thereafter | 79,580 | |
Total undiscounted cash flows | 205,614 | |
Less imputed interest | (33,915) | |
Present value of lease liabilities | $ 171,699 | |
Future minimum annual lease payments: | ||
Fiscal 2020 | $ 22,198 | |
Fiscal 2021 | 22,617 | |
Fiscal 2022 | 22,556 | |
Fiscal 2023 | 23,173 | |
Fiscal 2024 | 23,373 | |
Thereafter | 34,634 | |
Total minimum lease payments | $ 148,551 |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Details) $ in Millions | Apr. 30, 2019USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Letters of credit outstanding | $ 9.7 |
Commitments and Contingencies_2
Commitments and Contingencies - Future Purchase Obligations (Details) $ in Thousands | Apr. 30, 2019USD ($) |
Purchase Obligation, Fiscal Year Maturity [Abstract] | |
Fiscal 2020, remainder | $ 6,142 |
Fiscal 2021 | 10,987 |
Fiscal 2022 | 9,379 |
Fiscal 2023 | 898 |
Fiscal 2024 | 943 |
Thereafter | 4,555 |
Total | $ 32,904 |
Stockholders' Equity - Narrativ
Stockholders' Equity - Narrative (Details) shares in Thousands, $ in Thousands | Apr. 26, 2018USD ($) | Apr. 30, 2019USD ($)planshares | Apr. 30, 2018USD ($) | Jan. 31, 2019shares | Feb. 01, 2019shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of stock-based compensation plans | plan | 3 | ||||
Unrecognized compensation cost, options | $ | $ 11,000 | ||||
Employee stock purchase plan, compensation expense | $ | $ 42,271 | $ 269,794 | |||
Stock options | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Unrecognized compensation cost, remaining weighted-average period for recognition | 1 year 7 months 6 days | ||||
RSUs | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Unrecognized compensation cost, remaining weighted-average period for recognition | 2 years 2 months 12 days | ||||
Service period | 4 years | ||||
Accelerated share based compensation expense | $ | $ 262,800 | ||||
Shares granted (in shares) | 1,174 | ||||
Unrecognized compensation cost, RSUs | $ | $ 51,200 | ||||
RSUs with vesting conditions | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Shares granted (in shares) | 700 | ||||
ESPP | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Employee stock purchase plan, shares purchased (in shares) | 200 | ||||
Employee stock purchase plan, compensation expense | $ | $ 1,900 | ||||
2018 Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Reserved for future issuance (in shares) | 26,800 | ||||
Annual increase in shares reserved, percentage of total shares | 5.00% | ||||
Number of shares reserved for future issuance | 8,500 | ||||
2018 ESPP | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Reserved for future issuance (in shares) | 5,300 | 3,800 | |||
Annual increase in shares reserved, percentage of total shares | 1.00% | ||||
Employee contribution, maximum percentage of earnings | 15.00% | ||||
Employee stock purchase plan, purchase price of common stock, percent of market price | 85.00% | ||||
Employee stock purchase plan offering period | 6 months |
Stockholders' Equity - Stock Op
Stockholders' Equity - Stock Option Activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended |
Apr. 30, 2019 | Jan. 31, 2019 | |
Number of Options Outstanding | ||
Beginning balance (in shares) | 13,648 | |
Options exercised (in shares) | (2,634) | |
Options canceled/expired (in shares) | (25) | |
Ending balance (in shares) | 10,989 | 13,648 |
Vested and expected to vest (in shares) | 10,852 | |
Exercisable (in shares) | 9,418 | |
Weighted-Average Exercise Price Per Share | ||
Beginning balance (in usd per share) | $ 12.27 | |
Options exercised (in usd per share) | 10.82 | |
Options canceled/expired (in usd per share) | 17.69 | |
Ending balance (in usd per share) | 12.61 | $ 12.27 |
Vested and expected to vest (in usd per share) | 12.55 | |
Exercisable (in usd per share) | $ 11.77 | |
Weighted-Average Remaining Contractual Term | ||
Balance | 5 years 4 months 28 days | 5 years 4 months 17 days |
Vested and expected to vest | 5 years 4 months 17 days | |
Exercisable | 5 years 18 days | |
Aggregate Intrinsic Value | ||
Balance | $ 484,184 | $ 507,371 |
Vested and expected to vest | 478,824 | |
Exercisable | $ 422,811 |
Stockholders' Equity - RSU Acti
Stockholders' Equity - RSU Activity (Details) - RSUs shares in Thousands | 3 Months Ended |
Apr. 30, 2019$ / sharesshares | |
Number of Units | |
Unvested at beginning of period (in shares) | shares | 17,142 |
Granted (in shares) | shares | 1,174 |
Vested (in shares) | shares | (2,468) |
Canceled (in shares) | shares | (821) |
Unvested at end of period (in shares) | shares | 15,027 |
Weighted-Average Grant Date Fair Value | |
Unvested at beginning of period (in usd per share) | $ / shares | $ 34.56 |
Granted (in usd per share) | $ / shares | 55.42 |
Vested (in usd per share) | $ / shares | 20.72 |
Canceled (in usd per share) | $ / shares | 37.23 |
Unvested at end of period (in usd per share) | $ / shares | $ 38.32 |
Net Loss per Share Attributab_3
Net Loss per Share Attributable to Common Stockholders - Calculation of basic and diluted net loss per share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Apr. 30, 2019 | Apr. 30, 2018 | |
Numerator: | ||
Net loss | $ (45,722) | $ (270,687) |
Less: preferred stock accretion | 0 | (353) |
Net loss attributable to common stockholders | $ (45,722) | $ (271,040) |
Denominator: | ||
Weighted-average common shares outstanding (in shares) | 172,101 | 36,334 |
Net loss per share attributable to common stockholders: | ||
Basic and diluted (in usd per share) | $ (0.27) | $ (7.46) |
Net Loss per Share Attributab_4
Net Loss per Share Attributable to Common Stockholders - Antidilutive Securities (Details) - shares shares in Thousands | 3 Months Ended | |
Apr. 30, 2019 | Apr. 30, 2018 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 25,897 | 133,851 |
Convertible preferred stock as-converted | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 0 | 100,350 |
Stock options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 10,989 | 18,477 |
Warrants to purchase convertible preferred stock | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 0 | 22 |
RSUs | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 14,620 | 15,002 |
ESPP | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 288 | 0 |
Net Loss per Share Attributab_5
Net Loss per Share Attributable to Common Stockholders - Narrative (Details) shares in Millions | Apr. 30, 2019shares |
RSUs with vesting conditions | |
IPO, Sale of Stock [Line Items] | |
RSUs outstanding (in shares) | 0.4 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 30, 2019 | Apr. 30, 2018 | |
Income Tax Disclosure [Abstract] | ||
Provision for income taxes | $ 1,346 | $ 708 |
Uncertain tax benefits | $ 9,700 |
Geographic Information (Details
Geographic Information (Details) $ in Thousands | 3 Months Ended | ||
Apr. 30, 2019USD ($)segment | Apr. 30, 2018USD ($) | Jan. 31, 2019USD ($) | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Number of operating segments | segment | 1 | ||
Number of reportable segments | segment | 1 | ||
Total revenue | $ 213,962 | $ 155,808 | |
Total property and equipment | 84,094 | $ 75,832 | |
U.S. | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total revenue | 176,266 | 129,814 | |
Total property and equipment | 70,291 | 60,625 | |
International | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total revenue | 37,696 | $ 25,994 | |
Total property and equipment | $ 13,803 | $ 15,207 |
Uncategorized Items - q12010q.h
Label | Element | Value |
Accounting Standards Update 2016-02 [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ (48,000) |
Accounting Standards Update 2016-02 [Member] | Retained Earnings [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ (48,000) |