Cover
Cover - shares | 3 Months Ended | |
May 03, 2024 | Jun. 04, 2024 | |
Entity Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | May 03, 2024 | |
Document Transition Report | false | |
Entity File Number | 001-37748 | |
Entity Registrant Name | SecureWorks Corp | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 27-0463349 | |
Entity Address, Address Line One | One Concourse Parkway NE | |
Entity Address, Address Line Two | Suite 500 | |
Entity Address, City or Town | Atlanta, | |
Entity Address, State or Province | GA | |
Entity Address, Postal Zip Code | 30328 | |
City Area Code | 404 | |
Local Phone Number | 327-6339 | |
Title of 12(b) Security | Class A Common Stock, | |
Trading Symbol | SCWX | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Central Index Key | 0001468666 | |
Current Fiscal Year End Date | --01-31 | |
Document Fiscal Year Focus | 2025 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Common Stock - Class A | ||
Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 18,402,902 | |
Common Stock - Class B | ||
Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 70,000,000 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (Unaudited) - USD ($) $ in Thousands | May 03, 2024 | Feb. 02, 2024 |
Current assets: | ||
Cash and cash equivalents | $ 47,024 | $ 68,655 |
Accounts receivable, net of allowances of $1,517 and $1,552, respectively | 46,805 | 54,266 |
Inventories, net | 1,123 | 727 |
Other current assets | 16,646 | 14,491 |
Total current assets | 111,598 | 138,139 |
Property and equipment, net | 1,851 | 2,149 |
Operating lease right-of-use assets, net | 4,632 | 5,069 |
Goodwill | 425,282 | 425,472 |
Intangible assets, net | 79,674 | 83,235 |
Other non-current assets | 44,838 | 70,715 |
Total assets | 667,875 | 724,779 |
Current liabilities: | ||
Accounts payable | 10,934 | 8,974 |
Accrued and other current liabilities | 44,292 | 61,895 |
Short-term deferred revenue | 126,083 | 131,245 |
Total current liabilities | 181,309 | 202,114 |
Long-term deferred revenue | 4,535 | 5,706 |
Operating lease liabilities, non-current | 6,815 | 7,803 |
Other non-current liabilities | 7,990 | 7,831 |
Total liabilities | 200,649 | 223,454 |
Commitments and contingencies (Note 6) | ||
Stockholders' equity: | ||
Preferred stock - $0.01 par value: 200,000 shares authorized; — shares issued | 0 | 0 |
Additional paid in capital | 999,267 | 996,291 |
Accumulated deficit | (506,239) | (470,163) |
Accumulated other comprehensive loss | (6,789) | (5,771) |
Treasury stock, at cost - 1,257 shares | (19,896) | (19,896) |
Total stockholders' equity | 467,226 | 501,325 |
Total liabilities and stockholders' equity | 667,875 | 724,779 |
Common Stock - Class A | ||
Stockholders' equity: | ||
Common stock | 183 | 164 |
Common Stock - Class B | ||
Stockholders' equity: | ||
Common stock | $ 700 | $ 700 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (Unaudited) (Parenthetical) - USD ($) shares in Thousands, $ in Thousands | May 03, 2024 | Feb. 02, 2024 |
Accounts receivable, allowance for doubtful accounts | $ 1,517 | $ 1,552 |
Preferred stock, par value (usd per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 200,000 | 200,000 |
Preferred Stock, shares issued (in shares) | 0 | 0 |
Treasury stock, shares (in shares) | 1,257 | 1,257 |
Common Stock - Class A | ||
Common stock, par value (usd per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 2,500,000 | 2,500,000 |
Common stock, shares issued (in shares) | 18,363 | 16,392 |
Common stock, shares outstanding (in shares) | 18,363 | 16,392 |
Common Stock - Class B | ||
Common stock, par value (usd per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 500,000 | 500,000 |
Common stock, shares issued (in shares) | 70,000 | 70,000 |
Common stock, shares outstanding (in shares) | 70,000 | 70,000 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
May 03, 2024 | May 05, 2023 | |
Total net revenue | $ 85,652 | $ 94,395 |
Total cost of revenue | 27,876 | 42,786 |
Gross profit | 57,776 | 51,609 |
Operating expenses: | ||
Research and development | 24,548 | 31,172 |
Sales and marketing | 23,901 | 34,526 |
General and administrative | 18,518 | 22,263 |
Reorganization and other related charges | 1,476 | 0 |
Total operating expenses | 68,443 | 87,961 |
Operating loss | (10,667) | (36,352) |
Interest and other (expense) income, net | 796 | (1,746) |
Loss before income taxes | (9,871) | (38,098) |
Income tax expense (benefit) | 26,205 | (7,128) |
Net loss | $ (36,076) | $ (30,970) |
Loss per common share (basic in usd per share) | $ (0.41) | $ (0.36) |
Loss per common share (diluted in usd per share) | $ (0.41) | $ (0.36) |
Weighted-average common shares outstanding (basic in shares) | 87,512 | 85,431 |
Weighted-average common shares outstanding (diluted in shares) | 87,512 | 85,431 |
Subscription | ||
Total net revenue | $ 72,221 | $ 77,259 |
Total cost of revenue | 20,816 | 31,019 |
Professional services | ||
Total net revenue | 13,431 | 17,136 |
Total cost of revenue | $ 7,060 | $ 11,767 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
May 03, 2024 | May 05, 2023 | |
Statement of Comprehensive Income [Abstract] | ||
Net loss | $ (36,076) | $ (30,970) |
Foreign currency translation adjustments, net of tax | (1,018) | 527 |
Comprehensive loss | $ (37,094) | $ (30,443) |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
May 03, 2024 | May 05, 2023 | |
Cash flows from operating activities: | ||
Net loss | $ (36,076) | $ (30,970) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 5,867 | 8,980 |
Amortization of right of use asset | 408 | 627 |
Amortization of costs capitalized to obtain revenue contracts | 3,849 | 4,574 |
Amortization of costs capitalized to fulfill revenue contracts | 0 | 954 |
Stock-based compensation expense | 8,969 | 7,270 |
Impact of income tax provision | 23,586 | (7,128) |
Provision for credit losses | (3) | (223) |
Changes in assets and liabilities: | ||
Accounts receivable | 7,135 | 15,661 |
Net transactions with Dell | (2,130) | 7,026 |
Inventories | (396) | (55) |
Other assets | (3,950) | (3,295) |
Accounts payable | 1,912 | (4,073) |
Deferred revenue | (5,429) | (6,167) |
Operating leases, net | (1,198) | (1,060) |
Accrued and other liabilities | (15,193) | (32,745) |
Net cash used in operating activities | (12,649) | (40,624) |
Cash flows from investing activities: | ||
Capital expenditures | (552) | (470) |
Software development costs | (1,382) | (1,210) |
Net cash used in investing activities | (1,934) | (1,680) |
Cash flows from financing activities: | ||
Taxes paid on vested restricted shares | (5,974) | (5,134) |
Net cash used in financing activities | (5,974) | (5,134) |
Effect of exchange rate changes on cash and cash equivalents | (1,074) | (1,569) |
Net decrease in cash and cash equivalents | (21,631) | (49,007) |
Cash and cash equivalents at beginning of the period | 68,655 | 143,517 |
Cash and cash equivalents at end of the period | $ 47,024 | $ 94,510 |
CONDENSED CONSOLIDATED STATEM_6
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Unaudited) - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock - Class A | Common Stock - Class B | Common Stock Common Stock - Class A | Common Stock Common Stock - Class B | Additional Paid in Capital | Accumulated Deficit | Accumulated Other Comprehensive Income/(Loss) | Treasury Stock |
Beginning balance (in shares) at Feb. 03, 2023 | 14,749 | 70,000 | |||||||
Beginning balance at Feb. 03, 2023 | $ 557,960 | $ 147 | $ 700 | $ 967,367 | $ (384,121) | $ (6,237) | $ (19,896) | ||
Statement of Shareholders' Equity | |||||||||
Net loss | (30,970) | (30,970) | |||||||
Other comprehensive income (loss) | 527 | 527 | |||||||
Vesting of restricted stock units (in shares) | 1,935 | ||||||||
Vesting of restricted stock units | 0 | $ 19 | (19) | ||||||
Common stock withheld as payment for withholding taxes upon the vesting of restricted shares (in shares) | (653) | ||||||||
Common stock withheld as payment for withholding taxes upon the vesting of restricted shares | (5,134) | $ (6) | (5,128) | ||||||
Stock-based compensation | 7,270 | 7,270 | |||||||
Ending balance (in shares) at May. 05, 2023 | 16,031 | 70,000 | |||||||
Ending balance at May. 05, 2023 | 529,653 | $ 160 | $ 700 | 969,490 | (415,091) | (5,710) | (19,896) | ||
Beginning balance (in shares) at Feb. 02, 2024 | 16,392 | 70,000 | 16,392 | 70,000 | |||||
Beginning balance at Feb. 02, 2024 | 501,325 | $ 164 | $ 700 | 996,291 | (470,163) | (5,771) | (19,896) | ||
Statement of Shareholders' Equity | |||||||||
Net loss | (36,076) | (36,076) | |||||||
Other comprehensive income (loss) | (1,018) | (1,018) | |||||||
Vesting of restricted stock units (in shares) | 2,944 | ||||||||
Vesting of restricted stock units | 0 | $ 29 | (29) | ||||||
Common stock withheld as payment for withholding taxes upon the vesting of restricted shares (in shares) | (973) | ||||||||
Common stock withheld as payment for withholding taxes upon the vesting of restricted shares | (5,974) | $ (10) | (5,964) | ||||||
Stock-based compensation | 8,969 | 8,969 | |||||||
Ending balance (in shares) at May. 03, 2024 | 18,363 | 70,000 | 18,363 | 70,000 | |||||
Ending balance at May. 03, 2024 | $ 467,226 | $ 183 | $ 700 | $ 999,267 | $ (506,239) | $ (6,789) | $ (19,896) |
DESCRIPTION OF THE BUSINESS AND
DESCRIPTION OF THE BUSINESS AND BASIS OF PRESENTATION | 3 Months Ended |
May 03, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
DESCRIPTION OF THE BUSINESS AND BASIS OF PRESENTATION | DESCRIPTION OF THE BUSINESS AND BASIS OF PRESENTATION Description of the Business SecureWorks Corp. (individually and collectively with its consolidated subsidiaries, “Secureworks” or the “Company”) is a leading global cybersecurity provider of technology-driven security solutions, singularly focused on protecting the Company’s customers. The Company has one primary business activity, which is to provide customers with technology-driven cybersecurity solutions. The Company’s chief operating decision-maker, who is the Chief Executive Officer, makes operating decisions, assesses performance, and allocates resources on a consolidated basis. There are no segment managers who are held accountable for operations and operating results below the consolidated unit level. Accordingly, Secureworks operates its business as a single reportable segment. On April 27, 2016, the Company completed its initial public offering, or IPO. Upon the closing of the IPO, Dell Technologies Inc., or Dell Technologies, owned, indirectly through Dell and its subsidiaries, all shares of the Company’s outstanding Class B common stock, which as of May 3, 2024, represented approximately 79.2% of the Company's total outstanding shares of common stock and approximately 97.4% of the combined voting power of both classes of the Company's outstanding common stock. Except where the context otherwise requires or where otherwise indicated, all references in this report to “Secureworks,” “we,” “us,” “our” and “Company” refer to SecureWorks Corp. and our subsidiaries on a consolidated basis. References to “Dell” refer to Dell Inc. and its subsidiaries on a consolidated basis. Basis of Presentation and Consolidation The Company’s condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America, or GAAP. Certain amounts from the prior years have been reclassified to conform to current year presentation. The preparation of financial statements in accordance with GAAP requires management to make assumptions and estimations that affect the amounts reported in the Company’s financial statements and notes. The condensed consolidated financial statements include assets, liabilities, revenue, and expenses of all majority-owned subsidiaries. Intercompany transactions and balances are eliminated in consolidation. For the periods presented, Dell has provided various corporate services to the Company in the ordinary course of business, including finance, tax, human resources, legal, insurance, IT, procurement, and facilities-related services. The cost of these services is charged in accordance with a shared services agreement, as amended or amended and restated, in part, from time to time, that went into effect on August 1, 2015. For more information regarding related party transactions, see “Note 10—Related Party Transactions.” Revisions The Company’s historical classification of the effects of exchange rate changes on the Company’s foreign denominated cash and cash equivalents balances was not presented separately as the effect of exchange rate changes on cash and cash equivalents in the Company's Condensed Consolidated Statements of Cash Flows, but rather was included as a component of net cash provided by (used in) operating activities and investing activities. The Company has revised the Condensed Consolidated Statements of Cash Flows for each fiscal quarter of fiscal 2024 to correct these classifications. For the three months ended May 5, 2023, the impact of this correction was a decrease of $1.6 million in net cash used in operating activities and de minimis impacts to cash flows from capital expenditures, as included in total cash used in investing activities. The corresponding amounts are presented separately as the effect of exchange rate changes on cash and cash equivalents. These revisions do not impact the Condensed Consolidated Statements of Operations, the Condensed Consolidated Statements of Comprehensive Loss, or the Condensed Consolidated Statements of Financial Position. The Company has concluded that the effect of this revision is not material to any of our previously issued financial statements. This revision impacts our unaudited interim Condensed Consolidated Financial Statements for each fiscal quarter in fiscal 2024. Fiscal Year The Company’s fiscal year is the 52- or 53-week period ending on the Friday closest to January 31. The Company refers to the fiscal year ending January 31, 2025 and the fiscal year ended February 2, 2024 as fiscal 2025 and fiscal 2024, respectively. Fiscal 2025 and fiscal 2024 each consist of 52 weeks and each quarter consists of 13 weeks. Unless otherwise indicated, all changes identified for the current-period results represent comparisons to results for the prior corresponding fiscal periods. 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, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting periods. Estimates are revised as additional information becomes available. In the Condensed Consolidated Statements of Operations, estimates are used when accounting for revenue arrangements, determining the cost of revenue, allocating cost, estimating the impact of contingencies, and evaluating long-lived asset impairment. In the Condensed Consolidated Statements of Financial Position, estimates are used in determining the valuation and recoverability of assets, such as accounts receivables, inventories, fixed assets, capitalized software, goodwill, and other identifiable intangible assets. Estimates are also used in determining the reported amounts of liabilities, such as taxes payable and the impact of contingencies. All estimates also impact the Condensed Consolidated Statements of Operations. Actual results could differ from these estimates due to risks and uncertainties, including uncertainty in the current economic environment and impacts of inflation. The Company considered the potential impact of the current economic and geopolitical uncertainty on its estimates and assumptions and determined there was not a material impact to the Company’s condensed consolidated financial statements as of and for the three months ended May 3, 2024. As the current economic environment continues to develop, many of the Company’s estimates could require increased judgment and be subject to a higher degree of variability and volatility. As a result, the Company’s estimates may change materially in future periods. Liquidity In recent periods, the Company has incurred losses from operations and operating cash outflows and, as of the Balance Sheet date, the Company has reported a deficit in working capital. The Company’s prior reorganization actions are expected to result in significant cost savings as the Company completes a transition to higher value, higher margin Taegis solutions. These efforts are expected to optimize the organizational structure and increase scalability to better position the Company for continued growth with improving operating margins over time. In the event that the Company’s financial results are below its expectations as a result of these or other factors, the Company may need to take additional actions to preserve existing cash reserves. As of May 3, 2024, the Company held $47.0 million of cash and cash equivalents. There were no amounts drawn on the $50 million Revolving Credit Facility with Dell as of May 3, 2024. The Company believes that its cash and cash equivalents and access to the Revolving Credit Facility will provide sufficient liquidity to meet its material cash requirements, including to fund its business and meet its obligations, for at least 12 months from the filing date of this report. Recently Adopted Accounting Pronouncements None. Summary of Significant Accounting Policies There have been no significant changes to the Company’s significant accounting policies as of and for the three months ended May 3, 2024, as compared to the significant accounting policies described in the Company’s Annual Report on Form 10-K for the fiscal year ended February 2, 2024. |
LOSS PER SHARE
LOSS PER SHARE | 3 Months Ended |
May 03, 2024 | |
Earnings Per Share [Abstract] | |
LOSS PER SHARE | LOSS PER SHARE Loss per share is calculated by dividing net loss for the periods presented by the respective weighted-average number of common shares outstanding, and it excludes any dilutive effects of share-based awards that may be anti-dilutive. Diluted net loss per common share is computed by giving effect to all potentially dilutive common shares, including common stock issuable upon the exercise of stock options and restricted stock units. The Company applies the two-class method to calculate earnings per share. Because the Class A common stock and the Class B common stock share the same rights in dividends and earnings, earnings per share (basic and diluted) are the same for both classes of common stock. Since losses were incurred in all periods presented, all potential common shares were determined to be anti-dilutive. The following table sets forth the computation of loss per common share (in thousands, except per share amounts): Three Months Ended May 3, May 5, Numerator: Net loss $ (36,076) $ (30,970) Denominator: Weighted-average number of shares outstanding: Basic and Diluted 87,512 85,431 Loss per common share: Basic and Diluted $ (0.41) $ (0.36) Weighted-average anti-dilutive share-based awards 7,400 4,860 |
CONTRACT BALANCES AND CONTRACT
CONTRACT BALANCES AND CONTRACT COSTS | 3 Months Ended |
May 03, 2024 | |
Revenue from Contract with Customer [Abstract] | |
CONTRACT BALANCES AND CONTRACT COSTS | CONTRACT BALANCES AND CONTRACT COSTS The Company derives revenue primarily from subscriptions and professional services. Subscription revenue is derived from (i) Taegis software-as-a-service, or SaaS, security platform and supplemental Managed Detection and Response, or MDR, services, and (ii) Managed Security Services. Taegis’ core offerings are the security platform, Taegis Extended Detection and Response, or XDR, and the supplemental MDR service, ManagedXDR. Managed Security Services are subscription-based arrangements that typically include a suite of security services utilizing the legacy platform. Professional services typically include incident response, adversarial testing services, and other security consulting arrangements. The following table presents revenue by service type (in thousands): Three Months Ended May 3, 2024 May 5, 2023 Net revenue: Taegis Subscription Solutions $ 69,075 $ 62,596 Managed Security Services 3,146 14,663 Total Subscription revenue $ 72,221 $ 77,259 Professional Services 13,431 17,136 Total net revenue $ 85,652 $ 94,395 Promises to provide the Company’s subscription-based SaaS solutions are accounted for as separate performance obligations and managed security services are accounted for as a single performance obligation. Our subscription contracts typically range from one The deferred revenue balance does not represent the total contract value of annual or multi-year, non-cancelable subscription agreements. The Company invoices its customers based on a variety of billing schedules. During the three months ended May 3, 2024, on average, approximately 66% of the Company’s recurring revenue was billed annually in advance and approximately 34% was billed on either a monthly or quarterly basis in advance. In addition, many of the Company’s professional services engagements are billed in advance of service commencement. The deferred revenue balance is influenced by several factors, including seasonality, the compounding effects of renewals, billing frequency, and invoice timing. Changes to the Company’s deferred revenue during the three months ended May 3, 2024 and May 5, 2023 are as follows (in thousands): As of February 2, 2024 Upfront payments received and billings during the three months ended May 3, 2024 Revenue recognized during the three months ended May 3, 2024 As of May 3, 2024 Deferred revenue $ 136,951 $ 59,818 $ (66,151) $ 130,618 As of February 3, 2023 Upfront payments received and billings during the three months ended May 5, 2023 Revenue recognized during the three months ended May 5, 2023 As of May 5, 2023 Deferred revenue $ 156,332 $ 63,370 $ (70,227) $ 149,475 Remaining Performance Obligation The remaining performance obligation represents the transaction price allocated to contracted revenue that has not yet been recognized, which includes deferred revenue and non-cancellable contracts that are expected to be invoiced and recognized as revenue in future periods. The remaining performance obligation consists of two elements: (i) the value of remaining services to be provided through the contract term for customers whose services have been activated, or active; and (ii) the value of subscription-based solutions contracted with customers that have not yet been installed, or backlog. Backlog is not recorded in revenue, deferred revenue or elsewhere in the consolidated financial statements until the Company establishes a contractual right to invoice, at which point backlog is recorded as revenue or deferred revenue, as appropriate. The Company applies the practical expedient in Accounting Standards Codification paragraph 606-10-50-14(a) and does not disclose information about remaining performance obligations that are part of a contract that has an original expected duration of one year or less. The Company expects that the amount of backlog relative to the total value of its contracts will change from year to year due to several factors, including the amount invoiced at the beginning of the contract term, the timing and duration of the Company’s customer agreements, varying invoicing cycles of agreements and changes in customer financial circumstances. Accordingly, fluctuations in backlog are not always a reliable indicator of future revenues. As of May 3, 2024, the Company expects to recognize remaining performance obligations as follows (in thousands): Total Expected to be recognized in the next 12 months Expected to be recognized in 12-24 months Expected to be recognized in 24-36 months Expected to be recognized thereafter Performance obligation - active $ 185,354 $ 118,833 $ 51,024 $ 12,320 $ 3,177 Performance obligation - backlog 623 208 208 207 — Total remaining performance obligations $ 185,977 $ 119,041 $ 51,232 $ 12,527 $ 3,177 Deferred Commissions and Fulfillment Costs The Company capitalizes a significant portion of its commission expense and related fringe benefits earned by its sales personnel. Historically, the Company capitalized certain costs to install and activate hardware and software used in its managed security services, primarily related to a portion of the compensation for the personnel who perform the installation activities. These deferred costs were amortized on a systematic basis that is consistent with the transfer to the customer of the goods or services to which the assets relate. Changes in the balance of total deferred commission and total deferred fulfillment costs during the three months ended May 3, 2024 and May 5, 2023 are as follows (in thousands): As of February 2, 2024 Amount capitalized Amount recognized As of May 3, 2024 Deferred commissions $ 41,815 $ 823 $ (3,849) $ 38,789 Deferred fulfillment costs — — — — As of February 3, 2023 Amount capitalized Amount recognized As of May 5, 2023 Deferred commissions $ 49,565 $ 2,265 $ (4,574) $ 47,256 Deferred fulfillment costs 3,232 — (954) 2,278 |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS | 3 Months Ended |
May 03, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND INTANGIBLE ASSETS | GOODWILL AND INTANGIBLE ASSETS Goodwill relates to the acquisition of Dell by Dell Technologies and represents the excess of the purchase price attributable to Secureworks over the fair value of the assets acquired and liabilities assumed, as well as subsequent business combinations completed by the Company. Goodwill decreased $0.2 million due to foreign currency translation for the three months ended May 3, 2024, compared to February 2, 2024. Goodwill totaled $425.3 million and $425.5 million as of May 3, 2024 and February 2, 2024, respectively. Goodwill and indefinite-lived intangible assets are tested for impairment on an annual basis during the third fiscal quarter of each fiscal year, or earlier if an indicator of impairment occurs. The Company completed the most recent annual impairment test in the third quarter of fiscal 2024 by performing a "Step 0" qualitative assessment of goodwill at the reporting unit level, as well as the Company's indefinite-lived trade name asset at the individual asset level. The Company has one reporting unit. The qualitative assessment includes the Company's consideration of the relevant events and circumstances that would affect the Company's single reporting unit and indefinite-lived assets, including macroeconomic, industry and market conditions, the Company's overall financial performance including changes to its cost structure and trends in the market price of the Company's Class A common stock. After assessing the totality of these events and circumstances, the Company determined it was not more-likely-than not that the fair value of the reporting unit and indefinite-lived intangible asset was less than their respective carrying values. No triggering events have transpired since the performance of the qualitative assessment that would indicate a potential impairment occurred during the period through May 3, 2024. Intangible Assets The Company ’ s intangible assets as of May 3, 2024 and February 2, 2024 were as follows: May 3, 2024 February 2, 2024 Gross Accumulated Net Gross Accumulated Net (in thousands) Customer relationships $ 189,518 $ (151,148) $ 38,370 $ 189,518 $ (147,624) $ 41,894 Acquired Technology 141,784 (139,300) 2,484 141,784 (139,042) 2,742 Developed Technology 18,452 (9,750) 8,702 17,070 (8,589) 8,481 Finite-lived intangible assets 349,754 (300,198) 49,556 348,372 (295,255) 53,117 Trade name 30,118 — 30,118 30,118 — 30,118 Total intangible assets $ 379,872 $ (300,198) $ 79,674 $ 378,490 $ (295,255) $ 83,235 |
DEBT
DEBT | 3 Months Ended |
May 03, 2024 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT Revolving Credit Facility SecureWorks, Inc., a wholly-owned subsidiary of SecureWorks Corp., is a party to a revolving credit agreement with a wholly-owned subsidiary of Dell Inc. under which the Company obtained a $50 million senior, unsecured revolving credit facility. Effective September 6, 2023, the Company executed an amendment to the revolving credit agreement that was effectuated on March 23, 2023. This amended agreement (1) increased the maximum principal amount of borrowings outstanding under the revolving credit facility to $50 million, (2) removed the one-time increase of up to an additional $30 million in borrowings upon mutual agreement by lender and borrower, (3) extended the commitment and required repayment date under the revolving credit agreement to March 23, 2026, and (4) modified the rate at which interest accrues on funds drawn against the revolving credit agreement to the Secured Overnight Finance Rate, or SOFR, plus 2.00%. Amounts under the facility may be borrowed, repaid and reborrowed from time to time during the term of the facility. The proceeds from loans made under the facility may be used for general corporate purposes. The credit agreement contains customary representations, warranties, covenants, and events of default. The unused portion of the facility is subject to a commitment fee of 0.35%, which is due upon expiration of the facility. There was no outstanding balance under the credit facility, and the Company was in compliance with all covenants as of May 3, 2024 or February 2, 2024. Additionally, there were no amounts borrowed under the credit facility during the three months ended May 3, 2024. The borrower will be required to repay, in full, all of the loans outstanding, including all accrued interest, and the facility will terminate upon a change of control of SecureWorks Corp. or following a transaction in which SecureWorks, Inc. ceases to be a direct or indirect wholly-owned subsidiary of SecureWorks Corp. The facility is not guaranteed by SecureWorks Corp. or its subsidiaries. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
May 03, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Legal Contingencies — From time to time, the Company is involved in claims and legal proceedings that arise in the ordinary course of business. The Company accrues a liability when it believes that it is both probable that a liability has been incurred and that it can reasonably estimate the amount of the loss. The Company reviews the status of such matters at least quarterly and adjusts its liabilities as necessary to reflect ongoing negotiations, settlements, rulings, advice of legal counsel and other relevant information. Whether the outcome of any claim, suit, assessment, investigation, or legal proceeding, individually or collectively, could have a material adverse effect on the Company’s business, financial condition, results of operations or cash flows will depend on a number of factors, including the nature, timing and amount of any associated expenses, amounts paid in settlement, damages or other remedies or consequences. To the extent new information is obtained and the Company’s views on the probable outcomes of claims, suits, assessments, investigations or legal proceedings change, changes in accrued liabilities would be recorded in the period in which such a determination is made. As of May 3, 2024, the Company does not believe that there were any such matters that, individually or in the aggregate, would have a material adverse effect on its business, financial condition, results of operations, or cash flows. Customer-based Taxation Contingencie s — Various government entities, or taxing authorities, require the Company to bill its customers for the taxes they owe based on the services they purchase from the Company. The application of the rules of each taxing authority concerning which services are subject to each tax and how those services should be taxed involves the application of judgment. Taxing authorities periodically perform audits to verify compliance and include all periods that remain open under applicable statutes, which generally range from three As of May 3, 2024, the Company is under audit with various state taxing authorities in which rulings related to the taxability of certain of its services are pending; t he Company has recorded an estimated liability of $1.7 million related to such matters. The Company expects to continue to appeal certain of these rulings, but should the Company not prevail, it could be subject to obligations to pay additional taxes together with associated penalties and interest for the audited tax period. Indemnifications —In the ordinary course of business, the Company enters into contractual arrangements under which it agrees to indemnify its customers from certain losses incurred by the customer as to third-party claims relating to the services performed on behalf of the Company or for certain losses incurred by the customer as to third-party claims arising from certain events as defined within the particular contract. Such indemnification obligations may not be subject to maximum loss clauses. Historically, payments related to these indemnifications have been immaterial. Concentrations —The Company sells solutions to customers of all sizes through a combination of partners and its sales organization. During the three months ended May 3, 2024 and May 5, 2023, the Company had no customer that represented 10% or more of its net revenue. |
LEASES
LEASES | 3 Months Ended |
May 03, 2024 | |
Leases [Abstract] | |
LEASES | LEASES The Company’s leases primarily relate to office facilities that have remaining lease terms of 0.3 years to 2.7 years, inclusive of renewal or termination options that the Company is reasonably certain to exercise. The components of lease expense were as follows: Three Months Ended May 3, May 5, (in thousands) Operating lease cost $ 572 $ 1,081 Variable lease costs 124 21 Total lease costs $ 696 $ 1,102 Supplemental cash flow information: Cash paid for amounts included in the measurement of operating lease liabilities $ 1,355 $ 1,328 Weighted-average information associated with the measurement of remaining operating lease obligations is as follows: May 3, 2024 Weighted-average remaining lease term 2.6 years Weighted-average discount rate 5.42 % The following table summarizes the maturity of the Company’s operating lease liabilities as of May 3, 2024 (in thousands): Fiscal Years Ending May 3, 2024 2025 $ 3,745 2026 4,526 2027 4,088 2028 — Thereafter — Total operating lease payments $ 12,359 Less imputed interest 759 Total operating lease liabilities $ 11,600 |
STOCK-BASED COMPENSATION AND OT
STOCK-BASED COMPENSATION AND OTHER LONG-TERM PERFORMANCE INCENTIVES | 3 Months Ended |
May 03, 2024 | |
Share-Based Payment Arrangement [Abstract] | |
STOCK-BASED COMPENSATION AND OTHER LONG-TERM PERFORMANCE INCENTIVES | STOCK-BASED COMPENSATION AND OTHER LONG-TERM PERFORMANCE INCENTIVES The SecureWorks Corp. 2016 Long-Term Incentive Plan, or the 2016 Plan, provides for the grant of options, stock appreciation rights, restricted stock, restricted stock units, whether time-based, performance-based or time- and performance-based, deferred stock units, unrestricted stock, dividend equivalent rights, other equity-based awards, and cash bonus awards. Awards may be granted under the 2016 Plan to individuals who are employees, officers, or non-employee directors of the Company or any of its affiliates, consultants and advisors who perform services for the Company or any of its affiliates, and any other individual whose participation in the 2016 Plan is determined to be in the best interests of the Company by the compensation committee of the board of directors. Under the 2016 Plan, during the three months ended May 3, 2024 and May 5, 2023, the Company granted 7,391,716 and 7,142,257 restricted stock units, respectively. The annual restricted stock units granted during these periods vest over a three-year period. Approximately 24% and 19% of such awards granted during the three months ended May 3, 2024 and May 5, 2023, respectively, are subject to performance conditions. The majority of the 7,391,716 restricted stock unit awards made during the three months ended May 3, 2024 are subject to stockholder approval at the Company’s 2024 annual meeting of stockholders of an amendment to the 2016 Plan to increase the number of shares of Class A common stock issuable under the plan and thus are not deemed granted or outstanding for accounting purposes. |
INCOME AND OTHER TAXES
INCOME AND OTHER TAXES | 3 Months Ended |
May 03, 2024 | |
Income Tax Disclosure [Abstract] | |
INCOME AND OTHER TAXES | INCOME AND OTHER TAXES The Company’s loss before income taxes, income tax expense (benefit), and effective income tax rate for the three months ended May 3, 2024 and May 5, 2023 were as follows (in thousands, except percentages): Three Months Ended May 3, May 5, Loss before income taxes $ (9,871) $ (38,098) Income tax expense (benefit) $ 26,205 $ (7,128) Effective tax rate (265.5) % 18.7 % On March 13, 2024, Dell’s economic ownership of the Company dropped below 80%. As a result, the Company no longer qualifies for inclusion in Dell Technologies’ consolidated U.S. federal income tax return, as well as the tax returns of certain U.S. state jurisdictions that follow similar consolidation requirements. Commencing with this deconsolidation, the Company will file its own consolidated U.S. federal income tax return. Given the Company's recent history of cumulative losses, a valuation allowance was recorded against its federal deferred tax assets, as well as certain U.S. state deferred tax assets. The Company recorded an initial valuation allowance of $26.2 million . Net deferred tax balances, which include the impacts of valuation allowances, are included in other non-current assets and other non-current liabilities in the Condensed Consolidated Statements of Financial Position. The Company's effective tax rate was a result of the increase in the valuation allowance partially offset by estimated taxable income for the fiscal year to date. For certain U.S. state jurisdictions where the Company continues to be included in consolidated filings with Dell Technologies, related deferred tax assets continue to be recognized under the separate return method, modified to apply the benefits-for-loss approach. Under the benefits-for-loss approach, net operating losses or other tax attributes are characterized as realized by the Company when those attributes are utilized by other members of the Dell consolidated group. During the three months ended May 5, 2023, the Company did not file separate federal tax returns as the Company generally was included in the tax grouping of other Dell entities within the respective entity’s tax jurisdiction. The income tax benefit has been calculated using the separate return method, modified to apply the benefits-for-loss approach. Under the benefits-for-loss approach, net operating losses or other tax attributes are characterized as realized by the Company when those attributes are utilized by other members of the Dell consolidated group. Effective for tax years beginning on or after January 1, 2022, the Tax Cuts and Jobs Act of 2017 eliminated the option to deduct research and development, or R&D, expenses in the year incurred and instead requires taxpayers to capitalize R&D expenses, including software development cost, and subsequently amortize such expenses over five years for R&D activities conducted in the United States and over fifteen years for R&D activities conducted outside of the United States. This legislation has materially impacted the Company's deferred tax assets and corresponding valuation allowance. As of May 3, 2024 and February 2, 2024, the Company had a net operating loss receivable from Dell of $6.0 million and $5.0 million, respectively. The Company had $4.4 million and $4.9 million of unrecognized tax benefits as of May 3, 2024 and February 2, 2024, respectively. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
May 03, 2024 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | RELATED PARTY TRANSACTIONS Allocated Expenses For the periods presented, Dell has provided various corporate services to Secureworks in the ordinary course of business. The costs of services provided to Secureworks by Dell are governed by a shared services agreement between Secureworks and Dell Inc. The total amounts of the charges under the shared services agreement with Dell were $0.7 million and $0.8 million for the three months ended May 3, 2024 and May 5, 2023, respectively. Management believes that the basis on which the expenses have been allocated is a reasonable reflection of the utilization of services provided to or the benefit received by the Company during the periods presented. Related Party Arrangements For the periods presented, related party transactions and activities involving Dell Inc. and its wholly-owned subsidiaries were not always consummated on terms equivalent to those that would prevail in an arm’s-length transaction where conditions of competitive, free-market dealing may exist. The Company purchases computer equipment for internal use from Dell Inc. and its subsidiaries that is capitalized within property and equipment in the Condensed Consolidated Statements of Financial Position. Purchases of computer equipment from Dell and EMC Corporation, or EMC, an indirect, wholly-owned subsidiary of Dell Technologies that provides enterprise software and storage, totaled $0.1 million for the three months ended May 3, 2024 and $0.2 million for the three months ended May 5, 2023, respectively. The Company also recognized revenue related to solutions provided to significant beneficial owners of Secureworks common stock, which include Mr. Dell and affiliates of Mr. Dell. The revenues recognized by the Company from solutions provided to Mr. Dell, MSD Capital, L.P. (n/k/a, DFO Management, LLC, a firm founded for the purposes of managing investments of Mr. Dell and his family), DFI Resources LLC, an entity affiliated with Mr. Dell, and the Michael and Susan Dell Foundation were immaterial to the Company. The Company provides solutions to certain customers whose contractual relationships have historically been with Dell rather than Secureworks, although the Company has the primary responsibility to provide the services. Effective August 1, 2015, in connection with the IPO, many of such customer contracts were transferred from Dell to the Company, forming a direct contractual relationship between the Company and the end customer. For customers whose contracts have not yet been transferred or whose contracts were subsequently originated through Dell under a reseller agreement, the Company recognized revenues of approximately $14.1 million and $15.0 million for the three months ended May 3, 2024 and May 5, 2023, respectively. In addition, as of May 3, 2024, the Company had approximately $2.9 million of contingent obligations to Dell related to outstanding performance bonds for certain customer contracts which Dell issued on behalf of the Company. These contingent obligations are not recognized as liabilities on the Company’s financial statements. Dell also purchases, as the Company’s customer and on behalf of certain of its own customers, solutions from the Company. The Company recognized revenues from such purchases of approximately $0.1 million for each of the three months ended May 3, 2024 and May 5, 2023. As a result of the foregoing related party arrangements, the Company has recorded the following related party balances in the Condensed Consolidated Statements of Financial Position as of May 3, 2024 and as of February 2, 2024 (in thousands): May 3, February 2, Related party payable (in accrued and other current liabilities) $ 3,076 $ 4,868 Accounts receivable from customers under reseller agreements with Dell (in accounts receivable, net) $ 4,116 $ 5,748 Net operating loss tax sharing receivable under agreement with Dell $ 6,012 $ 4,976 |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 3 Months Ended |
May 03, 2024 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS The Company measures fair value within the guidance of the three-level valuation hierarchy. This hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. The categorization of a measurement within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The three levels are defined as follows: • Level 1 - Quoted market prices in active markets for identical assets or liabilities • Level 2 - Other observable market-based inputs or unobservable inputs that are corroborated by market data • Level 3 - Significant unobservable inputs Assets and Liabilities Measured at Fair Value on a Recurring Basis The assets and liabilities of the Company that are measured at fair value on a recurring basis using the respective input levels as of May 3, 2024 and February 2, 2024 were as follows (in thousands): May 3, February 2, Level 1 Level 1 Cash equivalents - Money Market Funds $ 1,713 $ 1,691 Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis The carrying amounts of the Company’s accounts receivable, accounts payable, and accrued expenses approximate their respective fair value due to their short-term nature. |
REORGANIZATION AND OTHER RELATE
REORGANIZATION AND OTHER RELATED COSTS | 3 Months Ended |
May 03, 2024 | |
Restructuring and Related Activities [Abstract] | |
REORGANIZATION AND OTHER RELATED COSTS | REORGANIZATION AND OTHER RELATED COSTS Beginning in fiscal year ended February 3, 2023, the Company committed to a plan to align its investments more closely with its strategic priorities to meet the expected future needs of the business by reducing the Company’s workforce and implementing certain real estate‑related and other cost optimization actions. Under this plan and through continued reorganization actions, the Company began rebalancing investments cross-functionally in alignment with the Company’s current strategy and growth opportunities, such as focusing on the higher value, higher margin Taegis solutions, optimizing the Company’s organizational structure to increase its scalability, and other priorities, to better position the Company for continued growth with improving operating margins over time. Expenses associated with these actions consisted primarily of severance and other termination benefits, real estate-related expenses, and various other cost saving measures. The Company incurred expenses associated with the plan of approximately $1.5 million during the three months ended May 3, 2024. The following table summarizes the liability associated with these charges that is included in accrued and other current liabilities on the accompanying Condensed Consolidated Statement of Financial Position (in thousands): Workforce Real estate-related Other Total Balance as of February 3, 2023 $ 7,550 $ — $ 1,394 $ 8,944 Reorganization charge 13,873 3,272 — 17,145 Charges settled in cash (15,802) — (1,394) (17,196) Charges settled in non-cash — (3,272) — (3,272) Balance as of February 2, 2024 $ 5,621 $ — $ — $ 5,621 Reorganization charge $ 1,476 $ — $ — $ 1,476 Charges settled in cash (2,975) — — (2,975) Balance as of May 3, 2024 $ 4,122 $ — $ — $ 4,122 |
DESCRIPTION OF THE BUSINESS A_2
DESCRIPTION OF THE BUSINESS AND BASIS OF PRESENTATION (Policies) | 3 Months Ended |
May 03, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation and Consolidation | Basis of Presentation and Consolidation The Company’s condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America, or GAAP. Certain amounts from the prior years have been reclassified to conform to current year presentation. The preparation of financial statements in accordance with GAAP requires management to make assumptions and estimations that affect the amounts reported in the Company’s financial statements and notes. The condensed consolidated financial statements include assets, liabilities, revenue, and expenses of all majority-owned subsidiaries. Intercompany transactions and balances are eliminated in consolidation. |
Revisions | Revisions The Company’s historical classification of the effects of exchange rate changes on the Company’s foreign denominated cash and cash equivalents balances was not presented separately as the effect of exchange rate changes on cash and cash equivalents in the Company's Condensed Consolidated Statements of Cash Flows, but rather was included as a component of net cash provided by (used in) operating activities and investing activities. The Company has revised the Condensed Consolidated Statements of Cash Flows for each fiscal quarter of fiscal 2024 to correct these classifications. For the three months ended May 5, 2023, the impact of this correction was a decrease of $1.6 million in net cash used in operating activities and de minimis impacts to cash flows from capital expenditures, as included in total cash used in investing activities. The corresponding amounts are presented separately as the effect of exchange rate changes on cash and cash equivalents. These revisions do not impact the Condensed Consolidated Statements of Operations, the Condensed Consolidated Statements of Comprehensive Loss, or the Condensed Consolidated Statements of Financial Position. |
Fiscal Year | Fiscal Year The Company’s fiscal year is the 52- or 53-week period ending on the Friday closest to January 31. The Company refers to the fiscal year ending January 31, 2025 and the fiscal year ended February 2, 2024 as fiscal 2025 and fiscal 2024, respectively. Fiscal 2025 and fiscal 2024 each consist of 52 weeks and each quarter consists of 13 weeks. Unless otherwise indicated, all changes identified for the current-period results represent comparisons to results for the prior corresponding fiscal periods. |
Use of Estimates | Use of Estimates |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements None. |
Fair Value Measurements | The Company measures fair value within the guidance of the three-level valuation hierarchy. This hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. The categorization of a measurement within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The three levels are defined as follows: • Level 1 - Quoted market prices in active markets for identical assets or liabilities • Level 2 - Other observable market-based inputs or unobservable inputs that are corroborated by market data • Level 3 - Significant unobservable inputs |
LOSS PER SHARE (Tables)
LOSS PER SHARE (Tables) | 3 Months Ended |
May 03, 2024 | |
Earnings Per Share [Abstract] | |
Schedule of Net Loss Per Common Share, Basic and Diluted | The following table sets forth the computation of loss per common share (in thousands, except per share amounts): Three Months Ended May 3, May 5, Numerator: Net loss $ (36,076) $ (30,970) Denominator: Weighted-average number of shares outstanding: Basic and Diluted 87,512 85,431 Loss per common share: Basic and Diluted $ (0.41) $ (0.36) Weighted-average anti-dilutive share-based awards 7,400 4,860 |
CONTRACT BALANCES AND CONTRAC_2
CONTRACT BALANCES AND CONTRACT COSTS (Tables) | 3 Months Ended |
May 03, 2024 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Revenue by Service Type | The following table presents revenue by service type (in thousands): Three Months Ended May 3, 2024 May 5, 2023 Net revenue: Taegis Subscription Solutions $ 69,075 $ 62,596 Managed Security Services 3,146 14,663 Total Subscription revenue $ 72,221 $ 77,259 Professional Services 13,431 17,136 Total net revenue $ 85,652 $ 94,395 |
Schedule of Deferred Revenue | Changes to the Company’s deferred revenue during the three months ended May 3, 2024 and May 5, 2023 are as follows (in thousands): As of February 2, 2024 Upfront payments received and billings during the three months ended May 3, 2024 Revenue recognized during the three months ended May 3, 2024 As of May 3, 2024 Deferred revenue $ 136,951 $ 59,818 $ (66,151) $ 130,618 As of February 3, 2023 Upfront payments received and billings during the three months ended May 5, 2023 Revenue recognized during the three months ended May 5, 2023 As of May 5, 2023 Deferred revenue $ 156,332 $ 63,370 $ (70,227) $ 149,475 |
Schedule of Expected Timing to Recognize Remaining Performance Obligation | As of May 3, 2024, the Company expects to recognize remaining performance obligations as follows (in thousands): Total Expected to be recognized in the next 12 months Expected to be recognized in 12-24 months Expected to be recognized in 24-36 months Expected to be recognized thereafter Performance obligation - active $ 185,354 $ 118,833 $ 51,024 $ 12,320 $ 3,177 Performance obligation - backlog 623 208 208 207 — Total remaining performance obligations $ 185,977 $ 119,041 $ 51,232 $ 12,527 $ 3,177 |
Schedule of Deferred Commissions and Fulfillment Costs | Changes in the balance of total deferred commission and total deferred fulfillment costs during the three months ended May 3, 2024 and May 5, 2023 are as follows (in thousands): As of February 2, 2024 Amount capitalized Amount recognized As of May 3, 2024 Deferred commissions $ 41,815 $ 823 $ (3,849) $ 38,789 Deferred fulfillment costs — — — — As of February 3, 2023 Amount capitalized Amount recognized As of May 5, 2023 Deferred commissions $ 49,565 $ 2,265 $ (4,574) $ 47,256 Deferred fulfillment costs 3,232 — (954) 2,278 |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS (Tables) | 3 Months Ended |
May 03, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Indefinite-Lived Intangible Assets | The Company ’ s intangible assets as of May 3, 2024 and February 2, 2024 were as follows: May 3, 2024 February 2, 2024 Gross Accumulated Net Gross Accumulated Net (in thousands) Customer relationships $ 189,518 $ (151,148) $ 38,370 $ 189,518 $ (147,624) $ 41,894 Acquired Technology 141,784 (139,300) 2,484 141,784 (139,042) 2,742 Developed Technology 18,452 (9,750) 8,702 17,070 (8,589) 8,481 Finite-lived intangible assets 349,754 (300,198) 49,556 348,372 (295,255) 53,117 Trade name 30,118 — 30,118 30,118 — 30,118 Total intangible assets $ 379,872 $ (300,198) $ 79,674 $ 378,490 $ (295,255) $ 83,235 |
Schedule of Finite-Lived Intangible Assets | The Company ’ s intangible assets as of May 3, 2024 and February 2, 2024 were as follows: May 3, 2024 February 2, 2024 Gross Accumulated Net Gross Accumulated Net (in thousands) Customer relationships $ 189,518 $ (151,148) $ 38,370 $ 189,518 $ (147,624) $ 41,894 Acquired Technology 141,784 (139,300) 2,484 141,784 (139,042) 2,742 Developed Technology 18,452 (9,750) 8,702 17,070 (8,589) 8,481 Finite-lived intangible assets 349,754 (300,198) 49,556 348,372 (295,255) 53,117 Trade name 30,118 — 30,118 30,118 — 30,118 Total intangible assets $ 379,872 $ (300,198) $ 79,674 $ 378,490 $ (295,255) $ 83,235 |
LEASES (Tables)
LEASES (Tables) | 3 Months Ended |
May 03, 2024 | |
Leases [Abstract] | |
Components of Lease Cost | The components of lease expense were as follows: Three Months Ended May 3, May 5, (in thousands) Operating lease cost $ 572 $ 1,081 Variable lease costs 124 21 Total lease costs $ 696 $ 1,102 Supplemental cash flow information: Cash paid for amounts included in the measurement of operating lease liabilities $ 1,355 $ 1,328 Weighted-average information associated with the measurement of remaining operating lease obligations is as follows: May 3, 2024 Weighted-average remaining lease term 2.6 years Weighted-average discount rate 5.42 % |
Maturities of Operating Lease Liabilities | The following table summarizes the maturity of the Company’s operating lease liabilities as of May 3, 2024 (in thousands): Fiscal Years Ending May 3, 2024 2025 $ 3,745 2026 4,526 2027 4,088 2028 — Thereafter — Total operating lease payments $ 12,359 Less imputed interest 759 Total operating lease liabilities $ 11,600 |
INCOME AND OTHER TAXES (Tables)
INCOME AND OTHER TAXES (Tables) | 3 Months Ended |
May 03, 2024 | |
Income Tax Disclosure [Abstract] | |
Schedule of Effective Income Tax Rate Reconciliation | The Company’s loss before income taxes, income tax expense (benefit), and effective income tax rate for the three months ended May 3, 2024 and May 5, 2023 were as follows (in thousands, except percentages): Three Months Ended May 3, May 5, Loss before income taxes $ (9,871) $ (38,098) Income tax expense (benefit) $ 26,205 $ (7,128) Effective tax rate (265.5) % 18.7 % |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 3 Months Ended |
May 03, 2024 | |
Related Party Transactions [Abstract] | |
Schedule of Related Party Transactions | As a result of the foregoing related party arrangements, the Company has recorded the following related party balances in the Condensed Consolidated Statements of Financial Position as of May 3, 2024 and as of February 2, 2024 (in thousands): May 3, February 2, Related party payable (in accrued and other current liabilities) $ 3,076 $ 4,868 Accounts receivable from customers under reseller agreements with Dell (in accounts receivable, net) $ 4,116 $ 5,748 Net operating loss tax sharing receivable under agreement with Dell $ 6,012 $ 4,976 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended |
May 03, 2024 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The assets and liabilities of the Company that are measured at fair value on a recurring basis using the respective input levels as of May 3, 2024 and February 2, 2024 were as follows (in thousands): May 3, February 2, Level 1 Level 1 Cash equivalents - Money Market Funds $ 1,713 $ 1,691 |
REORGANIZATION AND OTHER RELA_2
REORGANIZATION AND OTHER RELATED COSTS (Tables) | 3 Months Ended |
May 03, 2024 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring Reserve by Type of Cost | The following table summarizes the liability associated with these charges that is included in accrued and other current liabilities on the accompanying Condensed Consolidated Statement of Financial Position (in thousands): Workforce Real estate-related Other Total Balance as of February 3, 2023 $ 7,550 $ — $ 1,394 $ 8,944 Reorganization charge 13,873 3,272 — 17,145 Charges settled in cash (15,802) — (1,394) (17,196) Charges settled in non-cash — (3,272) — (3,272) Balance as of February 2, 2024 $ 5,621 $ — $ — $ 5,621 Reorganization charge $ 1,476 $ — $ — $ 1,476 Charges settled in cash (2,975) — — (2,975) Balance as of May 3, 2024 $ 4,122 $ — $ — $ 4,122 |
DESCRIPTION OF THE BUSINESS A_3
DESCRIPTION OF THE BUSINESS AND BASIS OF PRESENTATION (Details) - USD ($) | 3 Months Ended | ||
May 03, 2024 | May 05, 2023 | Feb. 02, 2024 | |
Class of Stock [Line Items] | |||
Increase (decrease) in net cash used in operating activities | $ (12,649,000) | $ (40,624,000) | |
Cash and cash equivalents | 47,024,000 | $ 68,655,000 | |
Revision | |||
Class of Stock [Line Items] | |||
Increase (decrease) in net cash used in operating activities | $ (1,600,000) | ||
Revolving Credit Facility | Line of Credit | |||
Class of Stock [Line Items] | |||
Line of credit, outstanding balance | 0 | $ 0 | |
Maximum borrowing capacity | $ 50,000,000 | ||
IPO | Denali | |||
Class of Stock [Line Items] | |||
Percent of outstanding shares owned | 79.20% | ||
Percent of voting interests owned | 97.40% |
LOSS PER SHARE (Details)
LOSS PER SHARE (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
May 03, 2024 | May 05, 2023 | |
Numerator: | ||
Net loss | $ (36,076) | $ (30,970) |
Denominator: | ||
Weighted-average common shares outstanding (basic in shares) | 87,512 | 85,431 |
Weighted-average common shares outstanding (diluted in shares) | 87,512 | 85,431 |
Loss per common share: | ||
Loss per common share (basic in usd per share) | $ (0.41) | $ (0.36) |
Loss per common share (diluted in usd per share) | $ (0.41) | $ (0.36) |
Weighted-average anti-dilutive share-based awards (in shares) | 7,400 | 4,860 |
CONTRACT BALANCES AND CONTRAC_3
CONTRACT BALANCES AND CONTRACT COSTS - Disaggregation of Revenue by Service Type (Details) - USD ($) $ in Thousands | 3 Months Ended | |
May 03, 2024 | May 05, 2023 | |
Disaggregation of Revenue [Line Items] | ||
Total net revenue | $ 85,652 | $ 94,395 |
Taegis Subscription Solutions | ||
Disaggregation of Revenue [Line Items] | ||
Total net revenue | 69,075 | 62,596 |
Managed Security Services | ||
Disaggregation of Revenue [Line Items] | ||
Total net revenue | 3,146 | 14,663 |
Subscription | ||
Disaggregation of Revenue [Line Items] | ||
Total net revenue | 72,221 | 77,259 |
Professional services | ||
Disaggregation of Revenue [Line Items] | ||
Total net revenue | $ 13,431 | $ 17,136 |
CONTRACT BALANCES AND CONTRAC_4
CONTRACT BALANCES AND CONTRACT COSTS - Narrative (Details) | 3 Months Ended |
May 03, 2024 performanceObligationElement | |
Disaggregation of Revenue [Line Items] | |
Deferred revenue billed in advance, percent | 66% |
Deferred revenue billed monthly or quarterly, percent | 34% |
Number of elements performance obligation is comprised of | 2 |
Subscription-Based Solutions | Minimum | |
Disaggregation of Revenue [Line Items] | |
Performance obligation period | 1 year |
Subscription-Based Solutions | Maximum | |
Disaggregation of Revenue [Line Items] | |
Performance obligation period | 3 years |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-05-04 | |
Disaggregation of Revenue [Line Items] | |
Performance obligation period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-05-04 | Professional services | |
Disaggregation of Revenue [Line Items] | |
Performance obligation period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-05-03 | |
Disaggregation of Revenue [Line Items] | |
Performance obligation period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-05-02 | |
Disaggregation of Revenue [Line Items] | |
Performance obligation period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2027-05-01 | |
Disaggregation of Revenue [Line Items] | |
Performance obligation period |
CONTRACT BALANCES AND CONTRAC_5
CONTRACT BALANCES AND CONTRACT COSTS - Deferred Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | |
May 03, 2024 | May 05, 2023 | |
Change in Contract with Customer, Liability [Roll Forward] | ||
Deferred revenue, Beginning of period | $ 136,951 | $ 156,332 |
Deferred revenue, Upfront payments received and billings | 59,818 | 63,370 |
Deferred revenue, Revenue recognized | (66,151) | (70,227) |
Deferred revenue, End of period | $ 130,618 | $ 149,475 |
CONTRACT BALANCES AND CONTRAC_6
CONTRACT BALANCES AND CONTRACT COSTS - Remaining Performance Obligation and Timing (Details) $ in Thousands | May 03, 2024 USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | $ 185,977 |
Performance obligation - active | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | 185,354 |
Performance obligation - backlog | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | 623 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-05-04 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | $ 119,041 |
Performance obligation period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-05-04 | Performance obligation - active | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | $ 118,833 |
Performance obligation period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-05-04 | Performance obligation - backlog | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | $ 208 |
Performance obligation period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-05-03 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | $ 51,232 |
Performance obligation period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-05-03 | Performance obligation - active | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | $ 51,024 |
Performance obligation period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-05-03 | Performance obligation - backlog | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | $ 208 |
Performance obligation period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-05-02 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | $ 12,527 |
Performance obligation period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-05-02 | Performance obligation - active | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | $ 12,320 |
Performance obligation period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-05-02 | Performance obligation - backlog | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | $ 207 |
Performance obligation period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2027-05-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | $ 3,177 |
Performance obligation period | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2027-05-01 | Performance obligation - active | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | $ 3,177 |
Performance obligation period | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2027-05-01 | Performance obligation - backlog | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | $ 0 |
Performance obligation period |
CONTRACT BALANCES AND CONTRAC_7
CONTRACT BALANCES AND CONTRACT COSTS - Deferred Commissions and Fulfillment Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | |
May 03, 2024 | May 05, 2023 | |
Deferred commissions | ||
Capitalized Contract Cost [Roll Forward] | ||
Beginning balance | $ 41,815 | $ 49,565 |
Amount capitalized | 823 | 2,265 |
Amount recognized | (3,849) | (4,574) |
Ending balance | 38,789 | 47,256 |
Deferred fulfillment costs | ||
Capitalized Contract Cost [Roll Forward] | ||
Beginning balance | 0 | 3,232 |
Amount capitalized | 0 | 0 |
Amount recognized | 0 | (954) |
Ending balance | $ 0 | $ 2,278 |
GOODWILL AND INTANGIBLE ASSET_2
GOODWILL AND INTANGIBLE ASSETS - Narrative (Details) | 3 Months Ended | ||
May 03, 2024 USD ($) reportingUnit | May 05, 2023 USD ($) | Feb. 02, 2024 USD ($) | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Goodwill, period increase (decrease) | $ (200,000) | ||
Goodwill | $ 425,282,000 | $ 425,472,000 | |
Number of reporting units | reportingUnit | 1 | ||
Amortization expense | $ 4,900,000 | $ 8,000,000 | |
Impairment charges | $ 0 | $ 0 |
GOODWILL AND INTANGIBLE ASSET_3
GOODWILL AND INTANGIBLE ASSETS - Intangible Assets (Details) - USD ($) $ in Thousands | May 03, 2024 | Feb. 02, 2024 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross | $ 349,754 | $ 348,372 |
Accumulated Amortization | (300,198) | (295,255) |
Net | 49,556 | 53,117 |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | ||
Gross | 379,872 | 378,490 |
Accumulated Amortization | (300,198) | (295,255) |
Net | 79,674 | 83,235 |
Trade name | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Indefinite-Lived Intangible Assets | 30,118 | 30,118 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross | 189,518 | 189,518 |
Accumulated Amortization | (151,148) | (147,624) |
Net | 38,370 | 41,894 |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | ||
Accumulated Amortization | (151,148) | (147,624) |
Acquired Technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross | 141,784 | 141,784 |
Accumulated Amortization | (139,300) | (139,042) |
Net | 2,484 | 2,742 |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | ||
Accumulated Amortization | (139,300) | (139,042) |
Developed Technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross | 18,452 | 17,070 |
Accumulated Amortization | (9,750) | (8,589) |
Net | 8,702 | 8,481 |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | ||
Accumulated Amortization | $ (9,750) | $ (8,589) |
DEBT (Details)
DEBT (Details) - Revolving Credit Facility - Line of Credit - USD ($) | 3 Months Ended | |
May 03, 2024 | Feb. 02, 2024 | |
Debt Instrument [Line Items] | ||
Maximum borrowing capacity | $ 50,000,000 | |
Additional borrowing capacity | $ 30,000,000 | |
Commitment fee percentage | 0.35% | |
Line of credit, outstanding balance | $ 0 | $ 0 |
Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | ||
Debt Instrument [Line Items] | ||
Basis spread on variable rate | 2% |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) $ in Millions | 3 Months Ended |
May 03, 2024 USD ($) | |
State and Local Jurisdiction | |
Other Commitments [Line Items] | |
Income tax examination, tax liability accrued | $ 1.7 |
Minimum | |
Other Commitments [Line Items] | |
Income tax examination, period | 3 years |
Maximum | |
Other Commitments [Line Items] | |
Income tax examination, period | 4 years |
LEASES - Narrative (Details)
LEASES - Narrative (Details) - USD ($) | 3 Months Ended | |
May 03, 2024 | Aug. 04, 2023 | |
Lessee, Lease, Description [Line Items] | ||
Impairment loss | $ 0 | $ 2,900,000 |
Minimum | ||
Lessee, Lease, Description [Line Items] | ||
Remaining lease term | 3 months 18 days | |
Maximum | ||
Lessee, Lease, Description [Line Items] | ||
Remaining lease term | 2 years 8 months 12 days |
LEASES - Components of Lease Ex
LEASES - Components of Lease Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
May 03, 2024 | May 05, 2023 | |
Leases [Abstract] | ||
Operating lease cost | $ 572 | $ 1,081 |
Variable lease costs | 124 | 21 |
Total lease costs | 696 | 1,102 |
Supplemental cash flow information: | ||
Cash paid for amounts included in the measurement of operating lease liabilities | $ 1,355 | $ 1,328 |
LEASES - Weighted Average (Deta
LEASES - Weighted Average (Details) | May 03, 2024 |
Leases [Abstract] | |
Weighted-average remaining lease term | 2 years 7 months 6 days |
Weighted-average discount rate | 5.42% |
LEASES - Maturities of Operatin
LEASES - Maturities of Operating Lease Liabilities (Details) $ in Thousands | May 03, 2024 USD ($) |
Operating Leases, After Adoption of 842: | |
2025 | $ 3,745 |
2026 | 4,526 |
2027 | 4,088 |
2028 | 0 |
Thereafter | 0 |
Total operating lease payments | 12,359 |
Less imputed interest | 759 |
Total operating lease liabilities | $ 11,600 |
STOCK-BASED COMPENSATION AND _2
STOCK-BASED COMPENSATION AND OTHER LONG-TERM PERFORMANCE INCENTIVES (Details) - USD ($) $ in Millions | 3 Months Ended | |
May 03, 2024 | May 05, 2023 | |
Restricted Stock Units (RSUs) | 2016 Long-Term Incentive Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Awards issued (in shares) | 7,391,716 | 7,142,257 |
Award vesting period (in years) | 3 years | |
Restricted Stock and Restricted Stock Units | 2016 Long-Term Incentive Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Percentage of grants issued subject to performance conditions | 24% | 19% |
Incentive Cash Awards | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Award vesting period (in years) | 3 years | |
Compensation expense | $ 0.3 | $ 0.7 |
INCOME AND OTHER TAXES - Effect
INCOME AND OTHER TAXES - Effective Income Tax Rate (Details) - USD ($) $ in Thousands | 3 Months Ended | |
May 03, 2024 | May 05, 2023 | |
Income Tax Disclosure [Abstract] | ||
Loss before income taxes | $ (9,871) | $ (38,098) |
Income tax expense (benefit) | $ 26,205 | $ (7,128) |
Effective tax rate | (265.50%) | 18.70% |
INCOME AND OTHER TAXES - Narrat
INCOME AND OTHER TAXES - Narrative (Details) - USD ($) $ in Thousands | May 03, 2024 | Mar. 13, 2024 | Feb. 02, 2024 |
Income Tax Examination [Line Items] | |||
Valuation allowance | $ 26,200 | ||
Other current assets | $ 16,646 | $ 14,491 | |
Unrecognized tax benefits | 4,400 | 4,900 | |
Dell Inc. | Net Operating Loss Receivable | Principal Owner | |||
Income Tax Examination [Line Items] | |||
Other current assets | 6,012 | 4,976 | |
Dell Inc. | Other Noncurrent Assets | Net Operating Loss Receivable | Principal Owner | |||
Income Tax Examination [Line Items] | |||
Other current assets | $ 6,000 | $ 5,000 |
RELATED PARTY TRANSACTIONS - Na
RELATED PARTY TRANSACTIONS - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | |
May 03, 2024 | May 05, 2023 | |
Related Party Transaction [Line Items] | ||
General and administrative | $ 18,518 | $ 22,263 |
Purchases of computer equipment from Dell | 552 | 470 |
Total net revenue | 85,652 | 94,395 |
Dell Inc. | Principal Owner | ||
Related Party Transaction [Line Items] | ||
General and administrative | 700 | 800 |
Dell Inc. | Principal Owner | Contracts Not Yet Transferred | ||
Related Party Transaction [Line Items] | ||
Total net revenue | 14,100 | 15,000 |
Performance bonds, outstanding | 2,900 | |
Dell Inc. | Principal Owner | Solutions Purchases | ||
Related Party Transaction [Line Items] | ||
Total net revenue | 100 | 100 |
Dell and EMC | Principal Owner | ||
Related Party Transaction [Line Items] | ||
Purchases of computer equipment from Dell | $ 100 | $ 200 |
RELATED PARTY TRANSACTIONS - Ba
RELATED PARTY TRANSACTIONS - Balances in Condensed Consolidated Statements of Financial Position (Details) - USD ($) $ in Thousands | May 03, 2024 | Feb. 02, 2024 |
Related Party Transaction [Line Items] | ||
Accrued and other current liabilities | $ 44,292 | $ 61,895 |
Other current assets | 16,646 | 14,491 |
Principal Owner | Dell Inc. | ||
Related Party Transaction [Line Items] | ||
Accounts receivable from customers under reseller agreements with Dell (in accounts receivable, net) | 4,116 | 5,748 |
Related Party Payable | Related Party | ||
Related Party Transaction [Line Items] | ||
Accrued and other current liabilities | 3,076 | 4,868 |
Net Operating Loss Receivable | Principal Owner | Dell Inc. | ||
Related Party Transaction [Line Items] | ||
Other current assets | $ 6,012 | $ 4,976 |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) - USD ($) $ in Thousands | May 03, 2024 | Feb. 02, 2024 |
Money Market Funds | Fair Value, Measurements, Recurring | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents - Money Market Funds | $ 1,713 | $ 1,691 |
REORGANIZATION AND OTHER RELA_3
REORGANIZATION AND OTHER RELATED COSTS - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | |
May 03, 2024 | May 05, 2023 | |
Restructuring and Related Activities [Abstract] | ||
Reorganization and other related charges | $ 1,476 | $ 0 |
REORGANIZATION AND OTHER RELA_4
REORGANIZATION AND OTHER RELATED COSTS - Reorganization and Other Related Costs Activity (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
May 03, 2024 | Feb. 02, 2024 | |
Restructuring Reserve [Roll Forward] | ||
Beginning balance | $ 5,621 | $ 8,944 |
Reorganization charge | 1,476 | 17,145 |
Charges settled in cash | (2,975) | (17,196) |
Charges settled in non-cash | (3,272) | |
Ending balance | 4,122 | 5,621 |
Workforce | ||
Restructuring Reserve [Roll Forward] | ||
Beginning balance | 5,621 | 7,550 |
Reorganization charge | 1,476 | 13,873 |
Charges settled in cash | (2,975) | (15,802) |
Charges settled in non-cash | 0 | |
Ending balance | 4,122 | 5,621 |
Real estate-related | ||
Restructuring Reserve [Roll Forward] | ||
Beginning balance | 0 | 0 |
Reorganization charge | 0 | 3,272 |
Charges settled in cash | 0 | 0 |
Charges settled in non-cash | (3,272) | |
Ending balance | 0 | 0 |
Other | ||
Restructuring Reserve [Roll Forward] | ||
Beginning balance | 0 | 1,394 |
Reorganization charge | 0 | 0 |
Charges settled in cash | 0 | (1,394) |
Charges settled in non-cash | 0 | |
Ending balance | $ 0 | $ 0 |