Document and Entity Information
Document and Entity Information | 6 Months Ended |
Jan. 31, 2017shares | |
Document and Entity Information [Abstract] | |
Document Type | 10-Q |
Amendment Flag | false |
Document Period End Date | Jan. 31, 2017 |
Document Fiscal Year Focus | 2,017 |
Document Fiscal Period Focus | Q2 |
Entity Registrant Name | Guidewire Software, Inc. |
Entity Central Index Key | 1,528,396 |
Entity Filer Category | Large Accelerated Filer |
Current Fiscal Year End Date | --07-31 |
Entity Common Stock, Shares Outstanding | 73,948,384 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Jan. 31, 2017 | Jul. 31, 2016 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 225,363 | $ 223,582 |
Short-term investments | 357,442 | 404,655 |
Accounts receivable | 64,626 | 62,792 |
Prepaid expenses and other current assets | 23,868 | 16,643 |
Total current assets | 671,299 | 707,672 |
Long-term investments | 146,125 | 107,565 |
Property and equipment, net | 11,738 | 12,955 |
Intangible assets, net | 26,510 | 14,204 |
Deferred tax assets, net | 41,521 | 31,364 |
Goodwill | 45,605 | 30,080 |
Other assets | 9,116 | 12,338 |
TOTAL ASSETS | 951,914 | 916,178 |
CURRENT LIABILITIES: | ||
Accounts payable | 8,269 | 9,929 |
Accrued employee compensation | 25,762 | 41,267 |
Deferred revenues, current | 86,572 | 60,270 |
Other current liabilities | 7,972 | 7,617 |
Total current liabilities | 128,575 | 119,083 |
Deferred revenues, noncurrent | 2,774 | 9,745 |
Other liabilities | 2,866 | 3,415 |
Total liabilities | 134,215 | 132,243 |
STOCKHOLDERS’ EQUITY: | ||
Common stock | 7 | 7 |
Additional paid-in capital | 781,635 | 742,690 |
Accumulated other comprehensive loss | (7,890) | (6,593) |
Accumulated deficit | 43,947 | 47,831 |
Total stockholders’ equity | 817,699 | 783,935 |
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ 951,914 | $ 916,178 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jan. 31, 2017 | Jan. 31, 2016 | Jan. 31, 2017 | Jan. 31, 2016 | |
Revenues : | ||||
License | $ 64,075 | $ 53,376 | $ 102,796 | $ 85,716 |
Maintenance | 16,582 | 14,256 | 33,114 | 28,269 |
Services | 34,964 | 34,497 | 73,838 | 70,424 |
Total revenues | 115,621 | 102,129 | 209,748 | 184,409 |
Cost of revenues: | ||||
License | 2,781 | 1,577 | 5,211 | 2,741 |
Maintenance | 3,079 | 2,636 | 6,404 | 5,111 |
Services | 34,951 | 30,688 | 71,215 | 62,219 |
Total cost of revenues | 40,811 | 34,901 | 82,830 | 70,071 |
Gross profit : | ||||
License | 61,294 | 51,799 | 97,585 | 82,975 |
Maintenance | 13,503 | 11,620 | 26,710 | 23,158 |
Services | 13 | 3,809 | 2,623 | 8,205 |
Total gross profit | 74,810 | 67,228 | 126,918 | 114,338 |
Operating expenses: | ||||
Research and development | 30,025 | 25,409 | 60,775 | 51,081 |
Sales and marketing | 23,520 | 22,661 | 49,020 | 41,952 |
General and administrative | 13,060 | 11,456 | 27,220 | 22,566 |
Total operating expenses | 66,605 | 59,526 | 137,015 | 115,599 |
Income (loss) from operations | 8,205 | 7,702 | (10,097) | (1,261) |
Interest income, net | 1,544 | 758 | 2,886 | 1,454 |
Other income (expense), net | 335 | (1,182) | (346) | (965) |
Income (loss) before income taxes | 10,084 | 7,278 | (7,557) | (772) |
Provision for (benefit from) income taxes | 6,110 | 6,365 | (3,673) | (55) |
Net income (loss) | $ 3,974 | $ 913 | $ (3,884) | $ (717) |
Earnings (loss) per share: | ||||
Basic | $ 0.05 | $ 0.01 | $ (0.05) | $ (0.01) |
Diluted | $ 0.05 | $ 0.01 | $ (0.05) | $ (0.01) |
Shares used in computing earnings (loss) per share: | ||||
Basic | 73,738,810 | 71,779,496 | 73,516,140 | 71,511,198 |
Diluted | 74,793,240 | 73,402,064 | 73,516,140 | 71,511,198 |
Condensed Consolidated Stateme4
Condensed Consolidated Statement of Comprehensive Income (Loss) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jan. 31, 2017 | Jan. 31, 2016 | Jan. 31, 2017 | Jan. 31, 2016 | |
Statement of Comprehensive Income [Abstract] | ||||
Net loss | $ 3,974 | $ 913 | $ (3,884) | $ (717) |
Foreign currency translation adjustments | 14 | (1,128) | (837) | (1,415) |
Unrealized gains (losses) on available-for-sale securities, net of tax benefit of $134 and $4 for the three months ended October 31, 2016 and 2015, respectively | (205) | (73) | (401) | (123) |
Reclassification adjustment for realized losses (gains) included in net loss | (32) | 20 | (59) | 0 |
Other comprehensive loss | (223) | (1,181) | (1,297) | (1,538) |
Comprehensive loss | $ 3,751 | $ (268) | $ (5,181) | $ (2,255) |
Condensed Consolidated Stateme5
Condensed Consolidated Statement of Comprehensive Income (Loss) (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jan. 31, 2017 | Jan. 31, 2016 | Jan. 31, 2017 | Jan. 31, 2016 | |
Statement of Comprehensive Income [Abstract] | ||||
Tax provision on unrealized gains on available-for-sale securities | $ 141 | $ 77 | $ 275 | $ 73 |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | |
Jan. 31, 2017 | Jan. 31, 2016 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (3,884) | $ (717) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 6,383 | 3,542 |
Stock-based compensation | 36,464 | 31,692 |
Excess tax benefit from exercise of stock options and vesting of RSUs | 0 | (566) |
Deferred tax assets | (5,617) | (1,703) |
Amortization of premium on available-for-sale securities | 860 | 1,838 |
Other non-cash items affecting net loss | 8 | 23 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (823) | 2,221 |
Prepaid expenses and other assets | (3,689) | (2,308) |
Accounts payable | (1,715) | (1,391) |
Accrued employee compensation | (15,084) | (14,964) |
Other liabilities | (615) | (121) |
Deferred revenues | 17,361 | 9,484 |
Net cash used in operating activities | 29,649 | 27,030 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchases of available-for-sale securities | (291,611) | (341,990) |
Sales of available-for-sale securities | 298,671 | 321,507 |
Purchase of property and equipment | (2,617) | (3,867) |
Payments to Acquire Businesses, Net of Cash Acquired | (33,534) | 0 |
Net cash used in investing activities | (29,091) | (24,350) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from issuance of common stock upon exercise of stock options | 2,034 | 3,989 |
Taxes remitted on RSU awards vested | 0 | (1,488) |
Excess tax benefit from exercise of stock options and vesting of RSUs | 0 | 566 |
Net cash provided by financing activities | 2,034 | 3,067 |
Effect of foreign exchange rate changes on cash and cash equivalents | (811) | (1,187) |
NET CHANGE IN CASH AND CASH EQUIVALENTS | 1,781 | 4,560 |
CASH AND CASH EQUIVALENTS—Beginning of period | 223,582 | 212,362 |
CASH AND CASH EQUIVALENTS—End of period | 225,363 | 216,922 |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: | ||
Cash paid for income taxes | 2,256 | 1,225 |
SUPPLEMENTAL DISCLOSURES OF NONCASH INVESTING AND FINANCING ACTIVITIES: | ||
Accruals for purchase of property and equipment | $ 521 | $ 393 |
The Company and Summary of Sign
The Company and Summary of Significant Accounting Policies and Estimates | 6 Months Ended |
Jan. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
The Company and Summary of Significant Accounting Policies and Estimates | The Company and Summary of Significant Accounting Policies and Estimates Business Guidewire Software, Inc., a Delaware corporation, was incorporated on September 20, 2001. Guidewire Software, Inc., together with its subsidiaries (the “Company”), provides a technology platform which consists of three key elements: core transaction processing, data management and analytics, and digital engagement. It supports core insurance operations, including underwriting and policy administration, claim management and billing, enables new insights into data that can improve business decision making and supports digital sales, service and claims experiences for policyholders, agents, and other key stakeholders. The Company’s customers are primarily insurance carriers for property and casualty insurance. Basis of Presentation The accompanying unaudited condensed consolidated financial statements and accompanying notes include the Company and its wholly-owned subsidiaries, and reflect all adjustments (all of which are normal and recurring in nature) that, in the opinion of management, are necessary for a fair presentation of the interim periods presented. All inter-company balances and transactions have been eliminated in consolidation. Certain information and note disclosures normally included in annual financial statements prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) have been condensed or omitted under the rules and regulations of the Securities and Exchange Commission (“SEC”). These unaudited interim condensed consolidated financial statements should be read in conjunction with the Company’s financial statements and related notes, together with management’s discussion and analysis of financial condition and results of operations, presented in the Company’s Annual Report on Form 10-K for the fiscal year ended July 31, 2016 . There have been no changes in the Company’s significant accounting policies from those that were disclosed in the Company’s consolidated financial statements for the fiscal year ended July 31, 2016 included in the Company’s Annual Report on Form 10-K except for the stock-based compensation policy which has been updated to address awards with market conditions in the first quarter of fiscal 2017. Use of Estimates The preparation of the accompanying condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions about future events that affect the amounts of assets and liabilities reported, disclosures about contingent assets and liabilities, and reported amounts of revenues and expenses. Significant items subject to such estimates include, but are not limited to, revenue recognition, the useful lives of property and equipment and intangible assets, allowance for doubtful accounts, valuation allowance for deferred tax assets, stock-based compensation, annual bonus attainment, income tax uncertainties, valuation of goodwill and intangible assets, and contingencies. These estimates and assumptions are based on management’s best estimates and judgment. Management regularly evaluates its estimates and assumptions using historical experience and other factors; however, actual results could differ significantly from these estimates. Cash and Cash Equivalents Cash and cash equivalents are comprised of cash and highly liquid investments with remaining maturities of 90 days or less at the date of purchase. Cash equivalents consist of commercial paper and money market funds. Investments Management determines the appropriate classification of investments at the time of purchase based upon management’s intent with regard to such investments. All investments are held as available-for-sale investments. The Company classifies investments as short-term when they have remaining contractual maturities of one year or less from the balance sheet date, and as long-term when the investments have remaining contractual maturities of more than one year from the balance sheet date. All investments are recorded at fair value with unrealized holding gains and losses included in accumulated other comprehensive income (loss). Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash, cash equivalents, investments and accounts receivable. The Company maintains its cash, cash equivalents and investments with high quality financial institutions. The Company is exposed to credit risk for cash held in financial institutions in the event of a default to the extent that such amounts recorded on the balance sheet are in excess of amounts that are insured by the Federal Deposit Insurance Corporation (“FDIC”). No customer individually accounted for 10% or more of the Company’s revenues for the three and six months ended January 31, 2017 or 2016 . No customer individually accounted for 10% or more of the Company’s total accounts receivable as of January 31, 2017 and July 31, 2016 . Revenue Recognition The Company enters into arrangements to deliver multiple products or services (multiple-elements). For a substantial majority of its sales, the Company applies software revenue recognition rules and allocates the total revenues among elements based on vendor-specific objective evidence (“VSOE”) of fair value of each element. The Company recognizes revenue on a net basis excluding indirect taxes, such as sales tax and value added tax collected from customers and remitted to government authorities. Revenues are derived from three sources: (i) License fees related to term (or time-based) licenses, perpetual software licenses, and other software subscription models including those from recently acquired companies; (ii) Maintenance fees related to email and phone support, bug fixes and unspecified software updates and upgrades released when, and if, available during the maintenance term; and (iii) Services fees from professional services related to the implementation of the Company’s software, reimbursable travel and training. Revenues are recognized when all of the following criteria are met: • Persuasive evidence of an arrangement exists. Evidence of an arrangement consists of a written contract signed by both the customer and management prior to the end of the period. • Delivery or performance has occurred . The Company’s software is delivered electronically to the customer. Delivery is considered to have occurred when the Company provides the customer access to the software along with login credentials. • Fees are fixed or determinable. The Company assesses whether a fee is fixed or determinable at the outset of the arrangement, primarily based on the payment terms associated with the transaction. Fees from term licenses are invoiced in annual or quarterly installments over the term of the agreement beginning on the effective date of the license. A significant majority are invoiced annually. Perpetual license fees are generally due between 30 and 60 days from delivery of software. Generally, the Company offers extended payment terms to its customers for term licenses. As a result, term license fees are not considered to be fixed and determinable until they become due or payment is received. • Collectability is probable. Collectability is assessed on a customer-by-customer basis, based primarily on creditworthiness as determined by credit checks and analysis, as well as customer payment history. Payment terms generally range from 30 to 90 days from invoice date. If it is determined prior to revenue recognition that collection of an arrangement fee is not probable, revenues are deferred until collection becomes probable or cash is collected, assuming all other revenue recognition criteria are satisfied. VSOE of fair value does not exist for the Company’s software licenses; therefore, the Company allocates revenues to software licenses using the residual method. Under the residual method, the amount recognized for license fees is the difference between the total fixed and determinable fees and the VSOE of fair value for the undelivered elements under the arrangement. The VSOE of fair value for elements of an arrangement is based upon the normal pricing and discounting practices for those elements when sold separately. VSOE of fair value for maintenance is established using the stated maintenance renewal rate in the customer’s contract. For term licenses with duration of one year or less, no VSOE of fair value for maintenance exists. VSOE of fair value for services is established if a substantial majority of historical stand-alone selling prices for a service fall within a reasonably narrow price range. If the undelivered elements are all service elements and VSOE of fair value does not exist for one or more service element, the total arrangement fee is recognized ratably over the longest service period starting at software delivery, assuming all the related services have been made available to the customer. Substantially all of the Company’s professional services engagements are billed on a time and materials basis. Services are typically not considered to be essential to the functionality of the software and the related revenues and costs are recognized in the period incurred. In select situations, the Company will contract its professional services on a fixed fee basis. In these situations, if reliable estimates of total project costs are available, the Company recognizes services revenues on a proportional performance basis as the performance obligations are completed by using the ratio of labor hours to date as an input measure compared to total estimated labor hours for the consulting services. If reliable estimates of total project costs cannot be made, the zero gross margin or the completed contract method is applied to revenues and direct costs. Under the zero gross margin method, revenues recognized are limited to the direct costs incurred for the implementation services. Under the completed contract method, revenues and direct costs are deferred until the project is complete. When the zero gross margin method is applied for lack of reliable project estimates and subsequently project estimates become reliable, the Company switches to the percentage-of-completion method, resulting in a cumulative effect adjustment for deferred license revenues to the extent of progress toward completion, and the related portion of the deferred professional service margin is recognized in full as revenues. In cases where professional services are deemed to be essential to the functionality of the software, the arrangement is accounted for using contract accounting until the essential services are complete. If reliable estimates of total project costs can be made, the Company applies the percentage-of-completion method whereby percentage toward completion is measured by using the ratio of service billings to date compared to total estimated service billings for the consulting services. Service billings approximate labor hours as an input measure since they are generally billed monthly on a time and material basis. The fees related to the maintenance are recognized over the period the maintenance is provided. The Company sells some of its products on a subscription basis, and the related revenues are recognized ratably over the contract term. As noted above, the Company generally invoices fees for licenses and maintenance to its customers in annual or quarterly installments payable in advance. Deferred revenues represent amounts, which are billed to or collected from creditworthy customers for which one or more of the revenue recognition criteria have not been met. The deferred revenues balance does not represent the total contract value of annual or multi-year, non-cancellable arrangements. Income Taxes Income taxes are accounted for under the asset and liability method. Under this method, the Company determines deferred tax assets and liabilities on the basis of the differences between the financial statement carrying amounts of existing assets and liabilities by using enacted tax rates in effect for the year in which the difference is expected to reverse. All deferred tax assets and liabilities are classified as non-current. Deferred tax assets related to excess tax benefits are recorded when utilized. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance against deferred tax assets is recorded when it is more likely than not that some portion or all of such deferred tax assets will not be realized and is based on the positive and negative evidence about the future including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations. The effective tax rate in any given financial statement period may differ materially from the statutory rate. These differences may be caused by changes in the mix and level of income or losses, changes in the expected outcome of audits, change in tax regulations, or changes in the deferred tax valuation allowance. The Company records interest and penalties related to unrecognized tax benefits as income tax expense in its condensed consolidated statement of operations. Stock-Based Compensation The Company accounts for stock-based compensation using the fair value method, which requires the Company to measure the stock-based compensation based on the grant-date fair value of the awards and recognize the compensation expense over the requisite service period. The Company recognizes compensation expense net of estimated forfeitures. To date, the Company has granted stock options, time-based restricted stock units (“RSUs”), performance-based restricted stock units (“PSUs”), and beginning in the first quarter of fiscal 2017, restricted stock units that may be earned subject to the Company’s total shareholder return ranking relative to the software companies in the S&P Software and Services Select Industry Index for a specified performance period or specified performance periods, time-based, and in select cases, subject to certain performance conditions (“TSR PSUs”). The fair value of the Company’s RSUs and PSUs equals the market value of the Company’s common stock on the date of grant. These awards are subject to time-based vesting, which generally occurs over a period of four years. The Company recognizes compensation expense for awards which contain only service conditions on a straight-line basis over the requisite service period, which is generally the vesting period of the respective awards. The Company recognizes the compensation cost for awards which contain either performance condition, market conditions, or both using the graded method. The fair value of the Company’s TSR PSUs are estimated at the grant date using a Monte Carlo simulation method. The assumptions utilized in this simulation require judgments and estimates. Changes in these inputs and assumptions could affect the measurement of the estimated fair value of the related compensation expense. Compensation expense associated with these TSR PSUs will be recognized regardless of whether the market condition is ultimately satisfied, however, the expense will be reversed if a grantee terminates prior to satisfying the requisite service period. For TSR PSUs containing an additional performance condition, a portion of the expense will fluctuate depending on the achievement of the performance conditions. All TSR PSUs will vest at the end of a three-year period. The fair value of each stock option award is estimated on the grant date using the Black-Scholes option-pricing model and is recognized on a straight-line basis over the applicable service period. The assumptions utilized in the option pricing model are expected term, expected volatility, risk-free interest rate and expected dividend. Each of these assumptions generally requires judgment to determine. Changes in these inputs and assumptions could affect the measurement of the estimated fair value of the related compensation expense. Business Combinations, Intangible Assets and Goodwill Impairment The Company uses its best estimates and assumptions to assign fair value to the tangible and intangible assets acquired and liabilities assumed at the acquisition date. Goodwill is calculated as the difference between the acquisition-date fair value of the consideration transferred and the values assigned to the assets acquired and liabilities assumed. The Company’s estimates of fair value are based upon assumptions believed to be reasonable, but which are inherently uncertain and subject to refinement and, as a result, actual results may differ from estimates. During the measurement period, which may be up to one year from the acquisition date, if new information is obtained about facts and circumstances that existed as of the acquisition date, the Company may record adjustments to the fair value of these assets and liabilities, with the corresponding offset to goodwill. Upon the conclusion of the measurement period or final determination of the fair value of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded to the Company’s consolidated statements of operations. The Company evaluates its acquired intangible assets for indicators of possible impairment when events or changes in circumstances indicate that the carrying amount of certain assets may not be recoverable. Impairment exists if the carrying amounts of such assets exceed the estimates of future net undiscounted cash flows expected to be generated by such assets. Should impairment exist, the impairment loss would be measured based on the excess carrying value of the assets over the estimated fair value of the assets. The Company tests goodwill for impairment annually during the fourth quarter of each fiscal year and in the interim whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. The Company evaluates qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the two-step goodwill impairment test. In performing the qualitative assessment, the Company considers events and circumstances, including but not limited to, macroeconomic conditions, industry and market considerations, cost factors, overall financial performance, changes in management or key personnel, changes in strategy, changes in customers, changes in the composition or carrying amount of a reporting unit’s net assets and changes in the price of the Company’s common stock. If, after assessing the totality of events or circumstances, the Company determines that it is more likely than not that the fair value of a reporting unit is greater than its carrying amount, then the two-step goodwill impairment test is not performed. In assessing impairment on the Company’s goodwill, the Company first analyzes qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the two-step goodwill impairment test. The qualitative factors the Company assesses include long-term prospects of its performance, share price trends and market capitalization, and Company specific events. If the Company concludes it is more likely than not that the fair value of a reporting unit exceeds its carrying amount, the Company does not need to perform the two-step impairment test. If based on that qualitative assessment, the Company believes it is more likely than not that the fair value of the reporting unit is less than its carrying value, a two-step goodwill impairment test will be performed. The first step measures for impairment by applying fair value-based tests at the reporting unit level. The second step (if necessary) measures the amount of impairment by applying fair value-based tests to the individual assets and liabilities within each reporting unit. Reporting units are determined by the components of operating segments that constitute a business for which (1) discrete financial information is available, (2) segment management regularly reviews the operating results of that component, and (3) whether the component has dissimilar economic characteristics to other components. The Company determined that it was more likely than not that the fair value of its reporting unit exceeded its carrying amount and, as such, the Company did not need to perform the two-step impairment test. Recent Accounting Pronouncements Improvements on Employee Share-Based Payment Accounting In March 2016, the FASB issued Accounting Standards Update (“ASU”) No. 2016-09, “Improvements on Employee Share-Based Payment Accounting (Topic 718)” (“ASU 2016-09”), which simplifies several aspects of the accounting for employee share-based payment transactions for both public and nonpublic entities, including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification in the statement of cash flows. The new standard is effective for annual periods beginning after December 15, 2016 and interim periods within those years. Early adoption is permitted. The standard will be effective for the Company beginning August 1, 2017. As required, the Company will make a cumulative-effect adjustment to shareholders' equity as of August 1, 2017 for unrecognized excess tax benefits or tax deficiencies that exist as of that date. In addition, beginning August 1, 2017, excess tax benefits and tax deficiencies will be reflected as income tax benefit or expense in the Company’s consolidated statement of operations and could result in a material impact. The extent of the excess tax benefits or tax deficiencies are subject to variation in our stock price and the timing of RSU vesting and employee stock option exercises. Revenue from Contracts with Customers In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606)”, which provides guidance for revenue recognition. This ASU affects any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of non-financial assets. This ASU will supersede the revenue recognition requirements in Topic 605, Revenue Recognition, and most industry-specific guidance. In August 2015, the FASB issued ASU No. 2015-14, “Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date”, deferring the effective date of this standard. As a result, the ASU and related amendments will be effective for the Company for its fiscal year beginning August 1, 2018, including interim periods within that fiscal year. Early adoption is permitted, but not before the original effective date of the ASU, August 1, 2017. Subsequently, the FASB issued ASU No. 2016-08, Principal Versus Agent Consideration (or Reporting Revenue Gross versus Net) in March 2016, ASU No. 2016-10, Identifying Performance Obligations and Licensing in April 2016, and ASU No. 2016-12, Narrow-Scope Improvements and Practical Expedients in May 2016. These amendments clarified certain aspects of Topic 606 and have the same effective date as ASU 2014-09. The Company will adopt these ASUs (collectively, Topic 606) on August 1, 2018. Topic 606 permits two methods of adoption: retrospectively to each prior reporting period presented (the “Full Retrospective Method”), or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application (the “Modified Retrospective Method”). The Company currently intends to apply the Modified Retrospective Method. The Company has evaluated the potential impact of Topic 606 on its revenue recognition policy and practices and has concluded that Topic 606 will impact the pattern of its revenue recognition associated with its software licenses. The Company’s term licenses require payments to be made annually or quarterly in advance and are subject to extended payment terms. Currently, revenues associated with the payment for term software licenses are recognized in the earlier of the period in which the payments are due or actually made. Under Topic 606, the Company will be required to recognize the revenue associated with such payments not when they are made or due, but when control of the software license is transferred to the customer, which occurs at or near the time a contract with a customer is executed. As a result, under Topic 606, all contractually obligated payments under a term license would be recognized upon delivery. In conjunction with its evaluation of this new standard, the Company began revising its contracting practices and amending existing agreements with certain customers primarily by shortening the initial, non-refundable term of its licenses. Since fiscal 2016, a substantial majority of new contracts feature a two-year initial term with subsequent one-year auto renewal options. The Company has engaged with its existing and prospective customers on its new licensing model. The Company continues to evaluate the other potential impacts that Topic 606 will have on its consolidated financial statements, internal controls, business processes, and information technology systems including, for example, how to account for commission expense. Business Combinations (Topic 805): Clarifying the Definition of a Business In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business, which provides a more robust framework to use in determining when a set of assets and activities is a business. The standard will be effective for the Company beginning August 1, 2018. Based on its current assessment, the Company does not expect the adoption of this update to have a material impact on its consolidated financial statements. Statement of Cash Flows (Topic 230): Restricted Cash In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash, which requires the statement of cash flows to report changes in cash, cash equivalents, and restricted cash. The standard will be effective for the Company beginning August 1, 2018. Based on its current assessment, the Company does not expect the adoption of this update to have a material impact on its consolidated financial statements. Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments (ASU 2016-15), which clarifies how companies present and classify certain cash receipts and cash payments in the statement of cash flows. The standard will be effective for the Company beginning August 1, 2018. Based on its current assessment, the Company does not expect the adoption of this update to have a material impact on its consolidated financial statements. Income Tax Consequences of an Intra-Entity Transfer of Assets Other Than Inventory In October 2016, the FASB issued ASU 2016-16, Income Taxes - Intra-Entity Transfers of Assets Other Than Inventory, which requires entities to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. The new standard must be adopted using a modified retrospective transition method which is a cumulative-effective adjustment to retained earnings as of the beginning of the first effective reporting period. The standard will be effective for the Company beginning August 1, 2018. Based on its current assessment, the Company does not expect the adoption of this update to have a material impact on its consolidated financial statements. Accounting for Leases In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)” (“ASU 2016-02”), which requires lessees to put most leases on their balance sheets but recognize the expenses on their income statements in a manner similar to current practice. ASU 2016-02 states that a lessee would recognize a lease liability for the obligation to make lease payments and a right-to-use asset for the right to use the underlying asset for the lease term. The standard will be effective for the Company beginning August 1, 2019. The Company is currently evaluating the impact this update will have on its consolidated financial statements. Simplifying the Test for Goodwill Impairment In January 2017, the FASB issued Accounting Standards Update No. 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment, which removes the requirement for an entity to calculate the implied fair value of goodwill (as part of step 2 of the current goodwill impairment test) in measuring a goodwill impairment loss. The standard will be effective for the Company beginning August 1, 2020. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company is currently evaluating the impact this update will have on its consolidated financial statements. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 6 Months Ended |
Jan. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Available-for-sale investments within cash equivalents and investments consist of the following: January 31, 2017 Amortized Cost Unrealized Gains Unrealized Losses Estimated Fair Value (in thousands) U.S. agency securities $ 39,665 $ 5 $ (57 ) $ 39,613 Commercial paper 151,597 4 (19 ) 151,582 Corporate bonds 273,835 111 (281 ) 273,665 U.S. government bonds 81,212 2 (141 ) 81,073 Foreign government bonds 2,419 — (7 ) 2,412 Certificates of deposit 29,488 24 (3 ) 29,509 Money market funds 109,007 — — 109,007 Total $ 687,223 $ 146 $ (508 ) $ 686,861 July 31, 2016 Amortized Cost Unrealized Gains Unrealized Losses Estimated Fair Value (in thousands) U.S. agency securities $ 58,070 $ 30 $ (12 ) $ 58,088 Commercial paper 152,317 12 (6 ) 152,323 Corporate bonds 274,656 321 (38 ) 274,939 U.S. government bonds 90,593 58 (2 ) 90,649 Foreign government bonds 2,418 9 — 2,427 Money market funds 114,833 — — 114,833 Total $ 692,887 $ 430 $ (58 ) $ 693,259 The following table shows the gross unrealized losses and fair value of the Company’s investments with unrealized losses, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position: January 31, 2017 Less Than 12 Months 12 Months or Greater Total Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses (in thousands) U.S. agency securities $ 24,506 $ (57 ) $ — $ — $ 24,506 $ (57 ) Commercial paper 39,357 (19 ) — — 39,357 (19 ) Corporate bonds 178,440 (280 ) 3,250 (1 ) 181,690 (281 ) U.S. government bonds 71,574 (141 ) — — 71,574 (141 ) Foreign government bonds 2,412 (7 ) — — 2,412 (7 ) Certificate of deposit 5,488 (3 ) — — 5,488 (3 ) Total $ 321,777 $ (507 ) $ 3,250 $ (1 ) $ 325,027 $ (508 ) As of January 31, 2017 , the Company had 129 investments in a gross unrealized loss position. The unrealized losses on its available-for-sale securities were primarily a result of changes in interest rates subsequent to the initial purchase of these securities. The Company does not intend to sell, nor believe it will need to sell, these securities before recovering the associated unrealized losses. The Company does not consider any portion of the unrealized losses at January 31, 2017 to be an other-than-temporary impairment, nor are any unrealized losses considered to be credit losses. The Company has recorded the securities at fair value in its condensed consolidated balance sheets, with unrealized gains and losses reported as a component of accumulated other comprehensive loss. The amounts of realized gains and losses reclassified into earnings are based on the specific identification of the securities sold. The realized gains and losses from sales of securities in the periods presented were not significant. The following table summarizes the contractual maturities of the Company’s investments measured at fair value as of January 31, 2017 : Less Than 12 Months 12 to 36 Months Total (in thousands) U.S. agency securities $ 20,986 $ 18,627 $ 39,613 Commercial paper 151,582 — 151,582 Corporate bonds 191,637 82,028 273,665 U.S. government bonds 38,015 43,058 81,073 Foreign government bonds — 2,412 2,412 Money market funds 109,007 — 109,007 Certificates of deposit 29,509 — 29,509 Total $ 540,736 $ 146,125 $ 686,861 Fair Value Measurement The current accounting guidance for fair value measurements defines a three-level valuation hierarchy for disclosures as follows: Level 1—Unadjusted quoted prices in active markets for identical assets or liabilities; Level 2—Inputs other than quoted prices included within Level 1 that are observable, unadjusted quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data; and Level 3—Unobservable inputs that are supported by little or no market activity, which require the Company to develop its own assumptions. The following tables summarize the Company’s financial assets measured at fair value on a recurring basis, by level within the fair value hierarchy as of January 31, 2017 and July 31, 2016 : January 31, 2017 Level 1 Level 2 Level 3 Total (in thousands) Assets Cash equivalents: Commercial paper $ — $ 74,287 $ — $ 74,287 Money market funds 109,007 — — 109,007 Short-term investments: U.S. agency securities — 20,987 — 20,987 Commercial paper — 77,295 — 77,295 U.S. government bonds — 38,015 — 38,015 Corporate bonds — 191,636 — 191,636 Certificates of deposit — 29,509 — 29,509 Long-term investments: U.S. agency securities — 18,626 — 18,626 Corporate bonds — 82,029 — 82,029 U.S. government bonds — 43,058 — 43,058 Foreign government bonds — 2,412 — 2,412 Total assets $ 109,007 $ 577,854 $ — $ 686,861 July 31, 2016 Level 1 Level 2 Level 3 Total (in thousands) Assets Cash equivalents: Commercial paper $ — $ 66,206 $ — $ 66,206 Money market funds 114,833 — — 114,833 Short-term investments: U.S. agency securities — 51,539 — 51,539 Commercial paper — 86,117 — 86,117 U. S. government bonds — 61,565 — 61,565 Corporate bonds — 205,434 — 205,434 Long-term investments: U.S. agency securities — 6,549 — 6,549 Corporate bonds — 69,505 — 69,505 U.S. government bonds — 29,084 — 29,084 Foreign government bonds — 2,427 — 2,427 Total assets $ 114,833 $ 578,426 $ — $ 693,259 |
Acquisition
Acquisition | 6 Months Ended |
Jan. 31, 2017 | |
Business Combinations [Abstract] | |
Acquisitions | Acquisitions On August 31, 2016, the Company acquired all of the outstanding equity interests of FirstBest Systems, Inc. (“FirstBest”), a privately-held provider of underwriting management systems and related applications to P&C insurers. Total consideration for the transaction was $37.8 million which included amounts placed into escrow to cover future potential claims. The Company believes that the acquisition will enable the expansion of its insurance platform by providing insurers in the U.S. and Canada writing complex commercial, specialty, and workers’ compensation lines greater support for their risk assessment and decision-making processes. Total acquisition costs of $1.2 million were expensed as incurred and recorded as general and administrative expenses in the accompanying condensed consolidated statement of operations, of which, $0.9 million were expensed as incurred during the six months ended January 31, 2017 and $0.3 million were expensed as incurred in the prior fiscal year. The transaction was accounted for as a business combination. As part of the preliminary purchase price allocation, the Company determined that FirstBest’s separately identifiable intangible assets were developed technology, customer contracts and related relationships, and order backlog. The Company measured fair values of the intangible assets by applying the income and relief from royalty approach. These fair value measurements were based on significant inputs that were not observable in the market and thus represents a Level 3 measurement. The valuation models were based on estimates of future operating projections of the acquired business and rights to sell new products containing the acquired technology as well as judgments on the discount rates used and other variables. The Company developed forecasts based on a number of factors including future revenue and operating cost projections, a discount rate that is representative of the weighted average cost of capital, in addition to royalty and long-term sustainable growth rates based on market analysis. The Company is amortizing the acquired intangible assets over their estimated useful lives. The allocation of the purchase price is preliminary pending the final valuation of intangible assets, certain acquired deferred tax assets and completion of certain statutory tax filing requirements and is therefore subject to potential future measurement period adjustments. Preliminary allocation of the purchase consideration was as follows: Total Purchase Price Allocation Estimated Useful Lives (in thousands) (in years) Acquired assets, net of assumed liabilities $ 2,518 Developed technology 8,000 5 Customer contracts and related relationships 6,500 9 Order backlog 900 3 Deferred tax assets, net 4,330 Goodwill 15,525 Total purchase price $ 37,773 The goodwill of $15.5 million arising from the acquisition consists largely of the acquired workforce, the expected company-specific synergies and the opportunity to expand the Company’s customer base. None of the goodwill recognized is expected to be deductible for income tax purposes. The results of FirstBest’s operations since the date of acquisition were included in the Company’s results of operations for the six months ended January 31, 2017, and were not material. The pro forma results of operations have not been presented because the effects of the business combination were not material to the Company’s consolidated results of operations. In March 2016, the Company purchased all of the outstanding equity interests of EagleEye Analytics, Inc. During the three months ended January 31, 2017, the fair value of all assets acquired and liabilities assumed in the transaction, including acquired deferred tax assets, were finalized and did not result in any additional adjustments to the preliminary purchase price allocation in the current quarter. |
Balance Sheet Components
Balance Sheet Components | 6 Months Ended |
Jan. 31, 2017 | |
Balance Sheet Related Disclosures [Abstract] | |
Balance Sheet Components | Balance Sheet Components Property and Equipment, net Property and equipment consist of the following: January 31, 2017 July 31, 2016 (in thousands) Computer hardware $ 20,512 $ 19,257 Software 5,271 5,066 Furniture and fixtures 3,545 3,492 Leasehold improvements 8,339 8,434 Total property and equipment 37,667 36,249 Less accumulated depreciation (25,929 ) (23,294 ) Property and equipment, net $ 11,738 $ 12,955 As of January 31, 2017 and July 31, 2016 , no property and equipment was pledged as collateral. Depreciation expense was $1.7 million and $1.4 million for the three months ended January 31, 2017 and 2016 , respectively, and was $3.3 million and $2.8 million for the six months ended January 31, 2017 and 2016 , respectively. Other Assets The Company’s equity investment in a privately-held company was accounted for under the cost method of accounting, and reported in long term other assets on the Company’s condensed consolidated balance sheet. The fair value of the investment is not readily available as there is no quoted market prices for the investment. Accordingly, if the Company were to disclose the fair value of the investment, the fair value measurement would be Level 3 in the valuation hierarchy. The Company assesses the investment for impairment when events or changes in circumstances indicate that its carrying amount may not be recoverable. As of January 31, 2017 and July 31, 2016, the investment with a carrying value of $6.0 million was not impaired. Goodwill and Intangible Assets The following table presents changes in the carrying amount of goodwill for the period presented: (in thousands) Goodwill, July 31, 2016 $ 30,080 Addition - FirstBest acquisition 15,525 Goodwill, January 31, 2017 $ 45,605 The Company’s intangible assets are amortized over the estimated useful lives. Intangible assets consist of the following: January 31, 2017 July 31, 2016 (in thousands) Cost Accumulated Amortization Net Book Value Cost Accumulated Amortization Net Book Value Amortized intangible assets: Acquired technology $ 21,900 $ 7,423 $ 14,477 $ 13,900 $ 5,199 $ 8,701 Customer contracts and related relationships 11,000 718 10,282 4,500 167 4,333 Partner relationships 200 18 182 200 8 192 Order backlog 2,000 431 1,569 1,100 122 978 Total amortized intangible assets $ 35,100 $ 8,590 $ 26,510 $ 19,700 $ 5,496 $ 14,204 Amortization expense was $1.7 million and $0.4 million for the three months ended January 31, 2017 and 2016 , respectively, and was $3.1 million and $0.7 million for the six months ended January 31, 2017 and 2016 , respectively. As of January 31, 2017 , the estimated aggregate amortization expense for each of the next five fiscal years is as follows: Future Amortization (in thousands) Fiscal year ending July 31, 2017 (remainder of fiscal year) $ 3,313 2018 6,305 2019 5,064 2020 3,986 2021 2,844 Thereafter 4,998 Total $ 26,510 Accrued Employee Compensation Accrued employee compensation expense consists of the following: January 31, 2017 July 31, 2016 (in thousands) Accrued bonuses $ 11,298 $ 24,872 Accrued commission 1,006 2,571 Accrued vacation 8,966 9,067 Accrued payroll taxes and benefits 4,492 4,757 Total $ 25,762 $ 41,267 Deferred Revenues Deferred revenues, current and non-current, consist of the following: January 31, 2017 July 31, 2016 (in thousands) Deferred license and other revenues $ 29,864 $ 19,841 Deferred maintenance revenues 37,076 38,928 Deferred services revenues 22,406 11,246 Total $ 89,346 $ 70,015 Deferred services revenues included $14.9 million and $5.1 million of deferred services revenues related to one customer engagement as of January 31, 2017 and July 31, 2016, respectively. Accumulated Other Comprehensive Loss Changes in accumulated other comprehensive loss by component during the six months ended January 31, 2017 were as follows: Foreign Currency Translation Adjustments Unrealized Gain (Loss) on Available-for-Sale Securities Total (in thousands) Balance as of July 31, 2016 $ (6,809 ) $ 216 $ (6,593 ) Other comprehensive gain (loss) before reclassification (837 ) (676 ) (1,513 ) Amounts reclassified from accumulated other comprehensive loss to earnings — (59 ) (59 ) Tax effect — 275 275 Balance as of January 31, 2017 $ (7,646 ) $ (244 ) $ (7,890 ) |
Net Loss Per Share
Net Loss Per Share | 6 Months Ended |
Jan. 31, 2017 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | Net Income (Loss) Per Share The following table sets forth the computation of the Company’s basic and diluted net income (loss) per share for the periods presented: Three Months Ended January 31, Six Months Ended January 31, 2017 2016 2017 2016 (in thousands, except share and per share amounts) Numerator: Net Income (loss) $ 3,974 $ 913 $ (3,884 ) $ (717 ) Net income (loss) per share: Basic $ 0.05 $ 0.01 $ (0.05 ) $ (0.01 ) Diluted $ 0.05 $ 0.01 $ (0.05 ) $ (0.01 ) Denominator: Weighted average shares used in computing net income (loss) per share: Basic 73,738,810 71,779,496 73,516,140 71,511,198 Weighted average effect of dilutive stock options 602,839 904,867 — — Weighted average effect of dilutive restricted stock units 451,591 717,701 — — Diluted 74,793,240 73,402,064 73,516,140 71,511,198 The following weighted shares outstanding of potential common stock were excluded from the computation of diluted income (loss) per share for the periods presented because including them would have been antidilutive: Three Months Ended January 31, Six Months Ended January 31, 2017 2016 2017 2016 Stock options to purchase common stock 59,323 77,975 1,009,969 1,574,949 Restricted stock units 832,650 283 3,119,079 3,346,340 |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jan. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies There has been no material change in the Company’s contractual obligations and commitments other than in the ordinary course of business since the Company’s fiscal year ended July 31, 2016 . See the Annual Report on Form 10-K for the fiscal year ended July 31, 2016 for additional information regarding the Company’s contractual obligations. Leases The Company leases certain facilities and equipment under operating leases. On December 5, 2011, the Company entered into a seven -year lease for a facility to serve as its corporate headquarters, located in Foster City, California, for approximately 97,674 square feet of space which commenced on August 1, 2012. In connection with this lease, the Company opened an unsecured letter of credit with Silicon Valley Bank for $1.2 million . On July 1, 2015, the unsecured letter of credit was reduced to $0.4 million in accordance with the lease agreement. Lease expense for all worldwide facilities and equipment, which is being recognized on a straight-line basis over terms of the various leases, was $1.6 million and $1.4 million for the three months ended January 31, 2017 and 2016 , respectively, and was $3.1 million and $2.8 million for the six months ended January 31, 2017 and 2016 , respectively. Letters of Credit The Company had two outstanding letters of credit required to secure contractual commitments and prepayments as of January 31, 2017 and July 31, 2016 , respectively. In addition to the unsecured letter of credit for the building lease, the Company had an unsecured letter of credit agreement related to a customer arrangement for Polish Zloty 10.0 million (approximately $2.5 million as of January 31, 2017 ) to secure contractual commitments and prepayments. No amounts were outstanding under the Company’s unsecured letters of credit as of January 31, 2017 or July 31, 2016 . Legal Proceedings From time to time, the Company is involved in various legal proceedings and receives claims, arising from the normal course of business activities. Although the outcomes of legal proceedings are inherently difficult to predict, the Company is not currently involved in any legal proceeding in which the outcome, in the Company’s judgment based on information currently available, is likely to have a material adverse effect on the Company’s business or financial position. The Company accrues for estimated losses in the accompanying condensed consolidated financial statements for matters with respect to which the Company believes the likelihood of an adverse outcome is probable and the amount of the loss is reasonably estimable. There is no such accrual as of January 31, 2017 or July 31, 2016 . Indemnification The Company sells software licenses and services to its customers under contracts (“Software License”). Each Software License contains the terms of the contractual arrangement with the customer and generally includes certain provisions for defending the customer against any claims that the Company’s software infringes upon a patent, copyright, trademark, or other proprietary right of a third party. Software Licenses also indemnify the customer against losses, expenses, and liabilities from damages that may be assessed against the customer in the event the Company’s software is found to infringe upon such third party rights. The Company has not had to reimburse any of its customers for losses related to indemnification provisions and no material claims against the Company were outstanding as of January 31, 2017 or July 31, 2016 . For several reasons, including the lack of prior indemnification claims and the lack of a monetary liability limit for certain infringement cases under various Software Licenses, the Company cannot estimate the amount of potential future payments, if any, related to indemnification provisions. The Company has also agreed to indemnify its directors and executive officers for costs associated with any fees, expenses, judgments, fines and settlement amounts incurred by any of these persons in any action or proceeding to which any of these persons is, or is threatened to be, made a party by reason of the person’s service as a director or officer, including any action by the Company, arising out of that person’s services as the Company’s director or officer or that person’s services provided to any other company or enterprise at the Company’s request. The Company maintains director and officer insurance coverage that may enable the Company to recover a portion of any future amounts paid. |
Stockholders' Equity and Stock-
Stockholders' Equity and Stock-based Compensation | 6 Months Ended |
Jan. 31, 2017 | |
Stockholders' Equity and Stock-based Compensation [Abstract] | |
Stockholders' Equity and Stock-based Compensation | Stockholders’ Equity and Stock-Based Compensation Stock-Based Compensation Expense Stock-based compensation expense related to stock-based awards is included in the Company’s condensed consolidated statements of operations as follows: Three Months Ended January 31, Six Months Ended January 31, 2017 2016 2017 2016 (in thousands) Total cost of stock-based compensation $ 18,807 $ 16,545 $ 36,911 $ 31,692 Amount capitalized in deferred cost of services revenues during the period (220 ) — (447 ) — Amount charged to income $ 18,587 $ 16,545 $ 36,464 $ 31,692 Stock-based compensation cost charged to the following expense categories: Cost of license revenues $ 90 $ 103 $ 141 $ 192 Cost of maintenance revenues 436 380 849 719 Cost of services revenues 4,815 4,673 9,510 9,036 Research and development 4,650 3,911 9,117 7,583 Sales and marketing 4,283 3,616 8,506 7,046 General and administrative 4,313 3,862 8,341 7,116 Total stock-based compensation expenses $ 18,587 $ 16,545 $ 36,464 $ 31,692 As of January 31, 2017 , total unamortized stock-based compensation cost, adjusted for estimated forfeitures, was as follows: As of January 31, 2017 Unrecognized Expense Weighted Average Expected Recognition Period (in thousands) (in years) Stock options $ 1,725 1.4 Restricted stock units 138,758 2.5 $ 140,483 Restricted Stock Units A summary of the Company’s RSU, PSU and TSR PSU activity under the Company’s equity incentive plans is as follows: RSUs Outstanding Number of RSUs Outstanding Weighted Average Grant Date Fair Value Aggregate Intrinsic Value (in thousands) (1) Balance as of July 31, 2016 2,727,724 $ 50.08 $ 167,673 Granted 1,219,045 $ 61.30 Released (732,214 ) $ 48.19 $ 41,639 Canceled (103,554 ) $ 52.27 Balance as of January 31, 2017 3,111,001 $ 54.85 $ 162,799 Expected to vest as of January 31, 2017 2,888,757 $ 54.57 $ 151,169 (1) Aggregate intrinsic value at each period end represents the total market value of RSUs at the Company’s closing stock price of $52.33 and $61.47 on January 31, 2017 and July 31, 2016 , respectively. Aggregate intrinsic value for released RSUs represents the total market value of released RSUs at date of release. Certain executives and employees of the Company received PSUs and TSR PSUs in addition to RSUs. The PSUs included performance-based conditions and vest over a four -year period. The TSR PSUs are subject to total shareholder return rankings relative to the software companies in the S&P Software and Services Select Industry Index for a specified performance period or specified performance periods, and vest at the end of three years. In select cases, certain TSR PSUs are also subject to performance-based conditions. Stock Options Stock option activity under the Company’s equity incentive plans is as follows: Stock Options Outstanding Number of Stock Options Outstanding Weighted Average Exercise Price Weighted Average Remaining Contractual Life Aggregate Intrinsic Value (1) (in years) (in thousands) Balance as of July 31, 2016 1,158,572 $ 15.45 4.0 $ 53,316 Granted — Exercised (176,251 ) $ 11.54 $ 8,121 Canceled — Balance as of January 31, 2017 982,321 $ 16.15 3.5 $ 35,575 Vested and expected to vest as of January 31, 2017 980,137 $ 16.08 3.5 $ 35,566 Exercisable as of January 31, 2017 886,629 $ 12.77 3.1 $ 35,096 (1) Aggregate intrinsic value at each period end represents the difference between the Company's closing stock prices of $52.33 and $61.47 on January 31, 2017 and July 31, 2016 , respectively, and the exercise price of outstanding options. Aggregate intrinsic value for exercised options represents the difference between the Company’s stock price at date of exercise and the exercise price. Valuation of Awards TSR PSUs The fair values of our TSR PSUs were estimated at the date of grant using the Monte Carlo simulation model which included the following assumptions: Three Months Ended January 31, Six Months Ended January 31, 2017 2016 2017 2016 Expected term (in years) 2.66 * 2.66 - 2.88 * Risk-free interest rate 1.34% * 0.89% - 1.34% * Expected volatility of the Company 30.2% * 30.2% - 31.5% * Average expected volatility of the peer companies in the index 36.9% * 36.9% - 37.0% * Expected dividend yield —% * —% * * There were no TSR PSUs granted during the three and six months ended January 31, 2016 . The number of TSR PSUs that may ultimately vest will vary based on the relative performance of the Company’s total shareholder return rankings relative to the software companies in the S&P Software and Services Select Industry Index for a specified performance period or specified performance periods. The Monte Carlo methodology incorporates into the valuation all possible outcomes, including that the Company’s relative performance may result in no shares vesting. As a result, stock-based compensation expense is recognized regardless of the ultimate achievement of the plan’s performance metrics. The expense will be reversed only in the event that a grantee is terminated prior to satisfying the requisite service period. For a subset of TSR PSUs, the number of shares that may ultimately vest will vary based on the achievement of certain Company specific financial performance metrics in addition to the Company’s total shareholder return condition noted above. As a result, the expense recognized will fluctuate based on the Company’s estimated financial performance relative to the target financial performance metrics. Common Stock Reserved for Issuance As of January 31, 2017 and July 31, 2016 , the Company was authorized to issue 500,000,000 shares of common stock with a par value of $0.0001 per share, and 73,948,384 and 73,039,919 shares of common stock were issued and outstanding, respectively. As of January 31, 2017 and July 31, 2016 , the Company had reserved shares of common stock for future issuance as follows: January 31, 2017 July 31, 2016 Exercise of stock options to purchase common stock 982,321 1,158,572 Vesting of restricted stock units 3,111,001 2,727,724 Shares available under stock plans 19,326,561 16,746,754 Total common stock reserved for issuance 23,419,883 20,633,050 |
Income Taxes
Income Taxes | 6 Months Ended |
Jan. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company recognized income tax expenses of $6.1 million and $6.4 million for the three months ended January 31, 2017 and 2016 , respectively, and recognized income tax benefits of $3.7 million and $0.1 million for the six months ended January 31, 2017 and 2016 , respectively. The increase in tax benefits for the six months ended January 31, 2017 was primarily due to an increase in the net loss in the six months ended January 31, 2017 , as compared to the same period a year ago. The effective tax rates of 61% and 49% for the three and six months ended January 31, 2017 , respectively, differ from the statutory U.S. federal income tax rate of 35% mainly due to permanent differences for stock-based compensation, research and development credits, domestic manufacturing deduction, the tax rate differences between the United States and foreign countries, and certain non-deductible expenses. The Company provides U.S. income taxes on the earnings of foreign subsidiaries, unless the subsidiaries’ earnings are considered indefinitely reinvested outside the United States. As of January 31, 2017 , U.S. income taxes were not provided for on the cumulative total of $32.5 million undistributed earnings from certain foreign subsidiaries. As of January 31, 2017 , the unrecognized deferred tax liability for these earnings was approximately $10.5 million . During the six months ended January 31, 2017 , the increase in unrecognized tax benefits from the beginning of the period was $1.5 million . Accordingly, as of January 31, 2017 , the Company had unrecognized tax benefits of $4.0 million that, if recognized, would affect the Company’s effective tax rate. |
Segment Information
Segment Information | 6 Months Ended |
Jan. 31, 2017 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information The Company operates in one segment. The Company’s chief operating decision maker (the “CODM”), its Chief Executive Officer, manages the Company’s operations on a consolidated basis for purposes of allocating resources. When evaluating the Company’s financial performance, the CODM reviews separate revenues information for the Company’s license, maintenance and professional services offerings, while all other financial information is reviewed on a consolidated basis. All of the Company’s principal operations and decision-making functions are located in the United States. The following table sets forth revenues by country and region based on the billing address of the customer: Three Months Ended January 31, Six Months Ended January 31, 2017 2016 2017 2016 (in thousands) United States $ 64,506 $ 62,078 $ 111,355 $ 105,185 Canada 14,355 7,091 28,849 16,149 Other Americas 3,872 2,178 9,096 4,627 Total Americas 82,733 71,347 149,300 125,961 United Kingdom 9,574 11,973 17,964 21,660 Other EMEA 8,809 5,303 17,750 12,178 Total EMEA 18,383 17,276 35,714 33,838 Total APAC 14,505 13,506 24,734 24,610 Total revenues $ 115,621 $ 102,129 $ 209,748 $ 184,409 No country, other than those presented above, accounted for more than 10% of revenues during the three and six months ended January 31, 2017 and 2016 , respectively. The following table sets forth the Company’s long-lived assets, including intangibles and goodwill, net by geographic region: January 31, 2017 July 31, 2016 (in thousands) Americas $ 80,531 $ 53,826 EMEA 3,110 3,085 APAC 212 328 Total $ 83,853 $ 57,239 |
Subsequent Event
Subsequent Event | 6 Months Ended |
Jan. 31, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Event | Subsequent Event On February 16, 2017 , pursuant to the Agreement and Plan of Merger entered into on December 18, 2016, the Company acquired ISCS, Inc. (“ISCS”) for approximately $160 million in cash. A portion of the consideration has been placed into an escrow account as partial security to satisfy any potential claims. The Company has also entered into continuing employment arrangements with approximately 184 ISCS professionals. The acquisition will be accounted for as a business combination. The Company has not yet completed its acquisition accounting for this transaction, and is in the process of evaluating the impact of the business combination on its consolidated financial statements. |
The Company and Summary of Si17
The Company and Summary of Significant Accounting Policies and Estimates (Policies) | 6 Months Ended |
Jan. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Business | Business Guidewire Software, Inc., a Delaware corporation, was incorporated on September 20, 2001. Guidewire Software, Inc., together with its subsidiaries (the “Company”), provides a technology platform which consists of three key elements: core transaction processing, data management and analytics, and digital engagement. It supports core insurance operations, including underwriting and policy administration, claim management and billing, enables new insights into data that can improve business decision making and supports digital sales, service and claims experiences for policyholders, agents, and other key stakeholders. The Company’s customers are primarily insurance carriers for property and casualty insurance. |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements and accompanying notes include the Company and its wholly-owned subsidiaries, and reflect all adjustments (all of which are normal and recurring in nature) that, in the opinion of management, are necessary for a fair presentation of the interim periods presented. All inter-company balances and transactions have been eliminated in consolidation. Certain information and note disclosures normally included in annual financial statements prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) have been condensed or omitted under the rules and regulations of the Securities and Exchange Commission (“SEC”). These unaudited interim condensed consolidated financial statements should be read in conjunction with the Company’s financial statements and related notes, together with management’s discussion and analysis of financial condition and results of operations, presented in the Company’s Annual Report on Form 10-K for the fiscal year ended July 31, 2016 . There have been no changes in the Company’s significant accounting policies from those that were disclosed in the Company’s consolidated financial statements for the fiscal year ended July 31, 2016 included in the Company’s Annual Report on Form 10-K except for the stock-based compensation policy which has been updated to address awards with market conditions in the first quarter of fiscal 2017. |
Use of Estimates | Use of Estimates The preparation of the accompanying condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions about future events that affect the amounts of assets and liabilities reported, disclosures about contingent assets and liabilities, and reported amounts of revenues and expenses. Significant items subject to such estimates include, but are not limited to, revenue recognition, the useful lives of property and equipment and intangible assets, allowance for doubtful accounts, valuation allowance for deferred tax assets, stock-based compensation, annual bonus attainment, income tax uncertainties, valuation of goodwill and intangible assets, and contingencies. These estimates and assumptions are based on management’s best estimates and judgment. Management regularly evaluates its estimates and assumptions using historical experience and other factors; however, actual results could differ significantly from these estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents are comprised of cash and highly liquid investments with remaining maturities of 90 days or less at the date of purchase. Cash equivalents consist of commercial paper and money market funds. |
Investments | Investments Management determines the appropriate classification of investments at the time of purchase based upon management’s intent with regard to such investments. All investments are held as available-for-sale investments. The Company classifies investments as short-term when they have remaining contractual maturities of one year or less from the balance sheet date, and as long-term when the investments have remaining contractual maturities of more than one year from the balance sheet date. All investments are recorded at fair value with unrealized holding gains and losses included in accumulated other comprehensive income (loss). |
Business Combinations | The Company uses its best estimates and assumptions to assign fair value to the tangible and intangible assets acquired and liabilities assumed at the acquisition date. Goodwill is calculated as the difference between the acquisition-date fair value of the consideration transferred and the values assigned to the assets acquired and liabilities assumed. The Company’s estimates of fair value are based upon assumptions believed to be reasonable, but which are inherently uncertain and subject to refinement and, as a result, actual results may differ from estimates. During the measurement period, which may be up to one year from the acquisition date, if new information is obtained about facts and circumstances that existed as of the acquisition date, the Company may record adjustments to the fair value of these assets and liabilities, with the corresponding offset to goodwill. Upon the conclusion of the measurement period or final determination of the fair value of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded to the Company’s consolidated statements of operations. |
Intangible Assets | The Company evaluates its acquired intangible assets for indicators of possible impairment when events or changes in circumstances indicate that the carrying amount of certain assets may not be recoverable. Impairment exists if the carrying amounts of such assets exceed the estimates of future net undiscounted cash flows expected to be generated by such assets. Should impairment exist, the impairment loss would be measured based on the excess carrying value of the assets over the estimated fair value of the assets. |
Goodwill Impairment | The Company tests goodwill for impairment annually during the fourth quarter of each fiscal year and in the interim whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. The Company evaluates qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the two-step goodwill impairment test. In performing the qualitative assessment, the Company considers events and circumstances, including but not limited to, macroeconomic conditions, industry and market considerations, cost factors, overall financial performance, changes in management or key personnel, changes in strategy, changes in customers, changes in the composition or carrying amount of a reporting unit’s net assets and changes in the price of the Company’s common stock. If, after assessing the totality of events or circumstances, the Company determines that it is more likely than not that the fair value of a reporting unit is greater than its carrying amount, then the two-step goodwill impairment test is not performed. In assessing impairment on the Company’s goodwill, the Company first analyzes qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the two-step goodwill impairment test. The qualitative factors the Company assesses include long-term prospects of its performance, share price trends and market capitalization, and Company specific events. If the Company concludes it is more likely than not that the fair value of a reporting unit exceeds its carrying amount, the Company does not need to perform the two-step impairment test. If based on that qualitative assessment, the Company believes it is more likely than not that the fair value of the reporting unit is less than its carrying value, a two-step goodwill impairment test will be performed. The first step measures for impairment by applying fair value-based tests at the reporting unit level. The second step (if necessary) measures the amount of impairment by applying fair value-based tests to the individual assets and liabilities within each reporting unit. Reporting units are determined by the components of operating segments that constitute a business for which (1) discrete financial information is available, (2) segment management regularly reviews the operating results of that component, and (3) whether the component has dissimilar economic characteristics to other components. The Company determined that it was more likely than not that the fair value of its reporting unit exceeded its carrying amount and, as such, the Company did not need to perform the two-step impairment test. |
Concentration of Credit Risk | Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash, cash equivalents, investments and accounts receivable. The Company maintains its cash, cash equivalents and investments with high quality financial institutions. The Company is exposed to credit risk for cash held in financial institutions in the event of a default to the extent that such amounts recorded on the balance sheet are in excess of amounts that are insured by the Federal Deposit Insurance Corporation (“FDIC”). |
Revenue Recognition | Revenue Recognition The Company enters into arrangements to deliver multiple products or services (multiple-elements). For a substantial majority of its sales, the Company applies software revenue recognition rules and allocates the total revenues among elements based on vendor-specific objective evidence (“VSOE”) of fair value of each element. The Company recognizes revenue on a net basis excluding indirect taxes, such as sales tax and value added tax collected from customers and remitted to government authorities. Revenues are derived from three sources: (i) License fees related to term (or time-based) licenses, perpetual software licenses, and other software subscription models including those from recently acquired companies; (ii) Maintenance fees related to email and phone support, bug fixes and unspecified software updates and upgrades released when, and if, available during the maintenance term; and (iii) Services fees from professional services related to the implementation of the Company’s software, reimbursable travel and training. Revenues are recognized when all of the following criteria are met: • Persuasive evidence of an arrangement exists. Evidence of an arrangement consists of a written contract signed by both the customer and management prior to the end of the period. • Delivery or performance has occurred . The Company’s software is delivered electronically to the customer. Delivery is considered to have occurred when the Company provides the customer access to the software along with login credentials. • Fees are fixed or determinable. The Company assesses whether a fee is fixed or determinable at the outset of the arrangement, primarily based on the payment terms associated with the transaction. Fees from term licenses are invoiced in annual or quarterly installments over the term of the agreement beginning on the effective date of the license. A significant majority are invoiced annually. Perpetual license fees are generally due between 30 and 60 days from delivery of software. Generally, the Company offers extended payment terms to its customers for term licenses. As a result, term license fees are not considered to be fixed and determinable until they become due or payment is received. • Collectability is probable. Collectability is assessed on a customer-by-customer basis, based primarily on creditworthiness as determined by credit checks and analysis, as well as customer payment history. Payment terms generally range from 30 to 90 days from invoice date. If it is determined prior to revenue recognition that collection of an arrangement fee is not probable, revenues are deferred until collection becomes probable or cash is collected, assuming all other revenue recognition criteria are satisfied. VSOE of fair value does not exist for the Company’s software licenses; therefore, the Company allocates revenues to software licenses using the residual method. Under the residual method, the amount recognized for license fees is the difference between the total fixed and determinable fees and the VSOE of fair value for the undelivered elements under the arrangement. The VSOE of fair value for elements of an arrangement is based upon the normal pricing and discounting practices for those elements when sold separately. VSOE of fair value for maintenance is established using the stated maintenance renewal rate in the customer’s contract. For term licenses with duration of one year or less, no VSOE of fair value for maintenance exists. VSOE of fair value for services is established if a substantial majority of historical stand-alone selling prices for a service fall within a reasonably narrow price range. If the undelivered elements are all service elements and VSOE of fair value does not exist for one or more service element, the total arrangement fee is recognized ratably over the longest service period starting at software delivery, assuming all the related services have been made available to the customer. Substantially all of the Company’s professional services engagements are billed on a time and materials basis. Services are typically not considered to be essential to the functionality of the software and the related revenues and costs are recognized in the period incurred. In select situations, the Company will contract its professional services on a fixed fee basis. In these situations, if reliable estimates of total project costs are available, the Company recognizes services revenues on a proportional performance basis as the performance obligations are completed by using the ratio of labor hours to date as an input measure compared to total estimated labor hours for the consulting services. If reliable estimates of total project costs cannot be made, the zero gross margin or the completed contract method is applied to revenues and direct costs. Under the zero gross margin method, revenues recognized are limited to the direct costs incurred for the implementation services. Under the completed contract method, revenues and direct costs are deferred until the project is complete. When the zero gross margin method is applied for lack of reliable project estimates and subsequently project estimates become reliable, the Company switches to the percentage-of-completion method, resulting in a cumulative effect adjustment for deferred license revenues to the extent of progress toward completion, and the related portion of the deferred professional service margin is recognized in full as revenues. In cases where professional services are deemed to be essential to the functionality of the software, the arrangement is accounted for using contract accounting until the essential services are complete. If reliable estimates of total project costs can be made, the Company applies the percentage-of-completion method whereby percentage toward completion is measured by using the ratio of service billings to date compared to total estimated service billings for the consulting services. Service billings approximate labor hours as an input measure since they are generally billed monthly on a time and material basis. The fees related to the maintenance are recognized over the period the maintenance is provided. The Company sells some of its products on a subscription basis, and the related revenues are recognized ratably over the contract term. |
Deferred Revenues | As noted above, the Company generally invoices fees for licenses and maintenance to its customers in annual or quarterly installments payable in advance. Deferred revenues represent amounts, which are billed to or collected from creditworthy customers for which one or more of the revenue recognition criteria have not been met. The deferred revenues balance does not represent the total contract value of annual or multi-year, non-cancellable arrangements. |
Income Taxes | Income Taxes Income taxes are accounted for under the asset and liability method. Under this method, the Company determines deferred tax assets and liabilities on the basis of the differences between the financial statement carrying amounts of existing assets and liabilities by using enacted tax rates in effect for the year in which the difference is expected to reverse. All deferred tax assets and liabilities are classified as non-current. Deferred tax assets related to excess tax benefits are recorded when utilized. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance against deferred tax assets is recorded when it is more likely than not that some portion or all of such deferred tax assets will not be realized and is based on the positive and negative evidence about the future including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations. The effective tax rate in any given financial statement period may differ materially from the statutory rate. These differences may be caused by changes in the mix and level of income or losses, changes in the expected outcome of audits, change in tax regulations, or changes in the deferred tax valuation allowance. The Company records interest and penalties related to unrecognized tax benefits as income tax expense in its condensed consolidated statement of operations. |
Stock-Based Compensation | Stock-Based Compensation The Company accounts for stock-based compensation using the fair value method, which requires the Company to measure the stock-based compensation based on the grant-date fair value of the awards and recognize the compensation expense over the requisite service period. The Company recognizes compensation expense net of estimated forfeitures. To date, the Company has granted stock options, time-based restricted stock units (“RSUs”), performance-based restricted stock units (“PSUs”), and beginning in the first quarter of fiscal 2017, restricted stock units that may be earned subject to the Company’s total shareholder return ranking relative to the software companies in the S&P Software and Services Select Industry Index for a specified performance period or specified performance periods, time-based, and in select cases, subject to certain performance conditions (“TSR PSUs”). The fair value of the Company’s RSUs and PSUs equals the market value of the Company’s common stock on the date of grant. These awards are subject to time-based vesting, which generally occurs over a period of four years. The Company recognizes compensation expense for awards which contain only service conditions on a straight-line basis over the requisite service period, which is generally the vesting period of the respective awards. The Company recognizes the compensation cost for awards which contain either performance condition, market conditions, or both using the graded method. The fair value of the Company’s TSR PSUs are estimated at the grant date using a Monte Carlo simulation method. The assumptions utilized in this simulation require judgments and estimates. Changes in these inputs and assumptions could affect the measurement of the estimated fair value of the related compensation expense. Compensation expense associated with these TSR PSUs will be recognized regardless of whether the market condition is ultimately satisfied, however, the expense will be reversed if a grantee terminates prior to satisfying the requisite service period. For TSR PSUs containing an additional performance condition, a portion of the expense will fluctuate depending on the achievement of the performance conditions. All TSR PSUs will vest at the end of a three-year period. The fair value of each stock option award is estimated on the grant date using the Black-Scholes option-pricing model and is recognized on a straight-line basis over the applicable service period. The assumptions utilized in the option pricing model are expected term, expected volatility, risk-free interest rate and expected dividend. Each of these assumptions generally requires judgment to determine. Changes in these inputs and assumptions could affect the measurement of the estimated fair value of the related compensation expense. |
Recent Accounting Pronouncement | Recent Accounting Pronouncements Improvements on Employee Share-Based Payment Accounting In March 2016, the FASB issued Accounting Standards Update (“ASU”) No. 2016-09, “Improvements on Employee Share-Based Payment Accounting (Topic 718)” (“ASU 2016-09”), which simplifies several aspects of the accounting for employee share-based payment transactions for both public and nonpublic entities, including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification in the statement of cash flows. The new standard is effective for annual periods beginning after December 15, 2016 and interim periods within those years. Early adoption is permitted. The standard will be effective for the Company beginning August 1, 2017. As required, the Company will make a cumulative-effect adjustment to shareholders' equity as of August 1, 2017 for unrecognized excess tax benefits or tax deficiencies that exist as of that date. In addition, beginning August 1, 2017, excess tax benefits and tax deficiencies will be reflected as income tax benefit or expense in the Company’s consolidated statement of operations and could result in a material impact. The extent of the excess tax benefits or tax deficiencies are subject to variation in our stock price and the timing of RSU vesting and employee stock option exercises. Revenue from Contracts with Customers In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606)”, which provides guidance for revenue recognition. This ASU affects any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of non-financial assets. This ASU will supersede the revenue recognition requirements in Topic 605, Revenue Recognition, and most industry-specific guidance. In August 2015, the FASB issued ASU No. 2015-14, “Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date”, deferring the effective date of this standard. As a result, the ASU and related amendments will be effective for the Company for its fiscal year beginning August 1, 2018, including interim periods within that fiscal year. Early adoption is permitted, but not before the original effective date of the ASU, August 1, 2017. Subsequently, the FASB issued ASU No. 2016-08, Principal Versus Agent Consideration (or Reporting Revenue Gross versus Net) in March 2016, ASU No. 2016-10, Identifying Performance Obligations and Licensing in April 2016, and ASU No. 2016-12, Narrow-Scope Improvements and Practical Expedients in May 2016. These amendments clarified certain aspects of Topic 606 and have the same effective date as ASU 2014-09. The Company will adopt these ASUs (collectively, Topic 606) on August 1, 2018. Topic 606 permits two methods of adoption: retrospectively to each prior reporting period presented (the “Full Retrospective Method”), or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application (the “Modified Retrospective Method”). The Company currently intends to apply the Modified Retrospective Method. The Company has evaluated the potential impact of Topic 606 on its revenue recognition policy and practices and has concluded that Topic 606 will impact the pattern of its revenue recognition associated with its software licenses. The Company’s term licenses require payments to be made annually or quarterly in advance and are subject to extended payment terms. Currently, revenues associated with the payment for term software licenses are recognized in the earlier of the period in which the payments are due or actually made. Under Topic 606, the Company will be required to recognize the revenue associated with such payments not when they are made or due, but when control of the software license is transferred to the customer, which occurs at or near the time a contract with a customer is executed. As a result, under Topic 606, all contractually obligated payments under a term license would be recognized upon delivery. In conjunction with its evaluation of this new standard, the Company began revising its contracting practices and amending existing agreements with certain customers primarily by shortening the initial, non-refundable term of its licenses. Since fiscal 2016, a substantial majority of new contracts feature a two-year initial term with subsequent one-year auto renewal options. The Company has engaged with its existing and prospective customers on its new licensing model. The Company continues to evaluate the other potential impacts that Topic 606 will have on its consolidated financial statements, internal controls, business processes, and information technology systems including, for example, how to account for commission expense. Business Combinations (Topic 805): Clarifying the Definition of a Business In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business, which provides a more robust framework to use in determining when a set of assets and activities is a business. The standard will be effective for the Company beginning August 1, 2018. Based on its current assessment, the Company does not expect the adoption of this update to have a material impact on its consolidated financial statements. Statement of Cash Flows (Topic 230): Restricted Cash In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash, which requires the statement of cash flows to report changes in cash, cash equivalents, and restricted cash. The standard will be effective for the Company beginning August 1, 2018. Based on its current assessment, the Company does not expect the adoption of this update to have a material impact on its consolidated financial statements. Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments (ASU 2016-15), which clarifies how companies present and classify certain cash receipts and cash payments in the statement of cash flows. The standard will be effective for the Company beginning August 1, 2018. Based on its current assessment, the Company does not expect the adoption of this update to have a material impact on its consolidated financial statements. Income Tax Consequences of an Intra-Entity Transfer of Assets Other Than Inventory In October 2016, the FASB issued ASU 2016-16, Income Taxes - Intra-Entity Transfers of Assets Other Than Inventory, which requires entities to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. The new standard must be adopted using a modified retrospective transition method which is a cumulative-effective adjustment to retained earnings as of the beginning of the first effective reporting period. The standard will be effective for the Company beginning August 1, 2018. Based on its current assessment, the Company does not expect the adoption of this update to have a material impact on its consolidated financial statements. Accounting for Leases In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)” (“ASU 2016-02”), which requires lessees to put most leases on their balance sheets but recognize the expenses on their income statements in a manner similar to current practice. ASU 2016-02 states that a lessee would recognize a lease liability for the obligation to make lease payments and a right-to-use asset for the right to use the underlying asset for the lease term. The standard will be effective for the Company beginning August 1, 2019. The Company is currently evaluating the impact this update will have on its consolidated financial statements. Simplifying the Test for Goodwill Impairment In January 2017, the FASB issued Accounting Standards Update No. 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment, which removes the requirement for an entity to calculate the implied fair value of goodwill (as part of step 2 of the current goodwill impairment test) in measuring a goodwill impairment loss. The standard will be effective for the Company beginning August 1, 2020. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company is currently evaluating the impact this update will have on its consolidated financial statements. |
Fair Value of Financial Instr18
Fair Value of Financial Instruments (Tables) | 6 Months Ended |
Jan. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Schedule of Available-for-sale Securities Reconciliation | investments within cash equivalents and investments consist of the following: January 31, 2017 Amortized Cost Unrealized Gains Unrealized Losses Estimated Fair Value (in thousands) U.S. agency securities $ 39,665 $ 5 $ (57 ) $ 39,613 Commercial paper 151,597 4 (19 ) 151,582 Corporate bonds 273,835 111 (281 ) 273,665 U.S. government bonds 81,212 2 (141 ) 81,073 Foreign government bonds 2,419 — (7 ) 2,412 Certificates of deposit 29,488 24 (3 ) 29,509 Money market funds 109,007 — — 109,007 Total $ 687,223 $ 146 $ (508 ) $ 686,861 July 31, 2016 Amortized Cost Unrealized Gains Unrealized Losses Estimated Fair Value (in thousands) U.S. agency securities $ 58,070 $ 30 $ (12 ) $ 58,088 Commercial paper 152,317 12 (6 ) 152,323 Corporate bonds 274,656 321 (38 ) 274,939 U.S. government bonds 90,593 58 (2 ) 90,649 Foreign government bonds 2,418 9 — 2,427 Money market funds 114,833 — — 114,833 Total $ 692,887 $ 430 $ (58 ) $ 693,259 |
Schedule of Unrealized Loss on Investments | The following table shows the gross unrealized losses and fair value of the Company’s investments with unrealized losses, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position: January 31, 2017 Less Than 12 Months 12 Months or Greater Total Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses (in thousands) U.S. agency securities $ 24,506 $ (57 ) $ — $ — $ 24,506 $ (57 ) Commercial paper 39,357 (19 ) — — 39,357 (19 ) Corporate bonds 178,440 (280 ) 3,250 (1 ) 181,690 (281 ) U.S. government bonds 71,574 (141 ) — — 71,574 (141 ) Foreign government bonds 2,412 (7 ) — — 2,412 (7 ) Certificate of deposit 5,488 (3 ) — — 5,488 (3 ) Total $ 321,777 $ (507 ) $ 3,250 $ (1 ) $ 325,027 $ (508 ) |
Investments Classified by Contractual Maturity Date | The following table summarizes the contractual maturities of the Company’s investments measured at fair value as of January 31, 2017 : Less Than 12 Months 12 to 36 Months Total (in thousands) U.S. agency securities $ 20,986 $ 18,627 $ 39,613 Commercial paper 151,582 — 151,582 Corporate bonds 191,637 82,028 273,665 U.S. government bonds 38,015 43,058 81,073 Foreign government bonds — 2,412 2,412 Money market funds 109,007 — 109,007 Certificates of deposit 29,509 — 29,509 Total $ 540,736 $ 146,125 $ 686,861 |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation | The current accounting guidance for fair value measurements defines a three-level valuation hierarchy for disclosures as follows: Level 1—Unadjusted quoted prices in active markets for identical assets or liabilities; Level 2—Inputs other than quoted prices included within Level 1 that are observable, unadjusted quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data; and Level 3—Unobservable inputs that are supported by little or no market activity, which require the Company to develop its own assumptions. |
Fair Value, Assets Measured on Recurring Basis | The following tables summarize the Company’s financial assets measured at fair value on a recurring basis, by level within the fair value hierarchy as of January 31, 2017 and July 31, 2016 : January 31, 2017 Level 1 Level 2 Level 3 Total (in thousands) Assets Cash equivalents: Commercial paper $ — $ 74,287 $ — $ 74,287 Money market funds 109,007 — — 109,007 Short-term investments: U.S. agency securities — 20,987 — 20,987 Commercial paper — 77,295 — 77,295 U.S. government bonds — 38,015 — 38,015 Corporate bonds — 191,636 — 191,636 Certificates of deposit — 29,509 — 29,509 Long-term investments: U.S. agency securities — 18,626 — 18,626 Corporate bonds — 82,029 — 82,029 U.S. government bonds — 43,058 — 43,058 Foreign government bonds — 2,412 — 2,412 Total assets $ 109,007 $ 577,854 $ — $ 686,861 July 31, 2016 Level 1 Level 2 Level 3 Total (in thousands) Assets Cash equivalents: Commercial paper $ — $ 66,206 $ — $ 66,206 Money market funds 114,833 — — 114,833 Short-term investments: U.S. agency securities — 51,539 — 51,539 Commercial paper — 86,117 — 86,117 U. S. government bonds — 61,565 — 61,565 Corporate bonds — 205,434 — 205,434 Long-term investments: U.S. agency securities — 6,549 — 6,549 Corporate bonds — 69,505 — 69,505 U.S. government bonds — 29,084 — 29,084 Foreign government bonds — 2,427 — 2,427 Total assets $ 114,833 $ 578,426 $ — $ 693,259 |
Acquisition (Tables)
Acquisition (Tables) | 6 Months Ended |
Jan. 31, 2017 | |
Business Combinations [Abstract] | |
Schedule of Business Acquisitions, by Acquisition | The allocation of the purchase price is preliminary pending the final valuation of intangible assets, certain acquired deferred tax assets and completion of certain statutory tax filing requirements and is therefore subject to potential future measurement period adjustments. Preliminary allocation of the purchase consideration was as follows: Total Purchase Price Allocation Estimated Useful Lives (in thousands) (in years) Acquired assets, net of assumed liabilities $ 2,518 Developed technology 8,000 5 Customer contracts and related relationships 6,500 9 Order backlog 900 3 Deferred tax assets, net 4,330 Goodwill 15,525 Total purchase price $ 37,773 |
Balance Sheet Components (Table
Balance Sheet Components (Tables) | 6 Months Ended |
Jan. 31, 2017 | |
Balance Sheet Related Disclosures [Abstract] | |
Property and equipment | Property and equipment consist of the following: January 31, 2017 July 31, 2016 (in thousands) Computer hardware $ 20,512 $ 19,257 Software 5,271 5,066 Furniture and fixtures 3,545 3,492 Leasehold improvements 8,339 8,434 Total property and equipment 37,667 36,249 Less accumulated depreciation (25,929 ) (23,294 ) Property and equipment, net $ 11,738 $ 12,955 |
Schedule of Goodwill | The following table presents changes in the carrying amount of goodwill for the period presented: (in thousands) Goodwill, July 31, 2016 $ 30,080 Addition - FirstBest acquisition 15,525 Goodwill, January 31, 2017 $ 45,605 |
Schedule of Finite-Lived Intangible Assets | The Company’s intangible assets are amortized over the estimated useful lives. Intangible assets consist of the following: January 31, 2017 July 31, 2016 (in thousands) Cost Accumulated Amortization Net Book Value Cost Accumulated Amortization Net Book Value Amortized intangible assets: Acquired technology $ 21,900 $ 7,423 $ 14,477 $ 13,900 $ 5,199 $ 8,701 Customer contracts and related relationships 11,000 718 10,282 4,500 167 4,333 Partner relationships 200 18 182 200 8 192 Order backlog 2,000 431 1,569 1,100 122 978 Total amortized intangible assets $ 35,100 $ 8,590 $ 26,510 $ 19,700 $ 5,496 $ 14,204 |
Future Amortization Expense | Amortization expense was $1.7 million and $0.4 million for the three months ended January 31, 2017 and 2016 , respectively, and was $3.1 million and $0.7 million for the six months ended January 31, 2017 and 2016 , respectively. As of January 31, 2017 , the estimated aggregate amortization expense for each of the next five fiscal years is as follows: Future Amortization (in thousands) Fiscal year ending July 31, 2017 (remainder of fiscal year) $ 3,313 2018 6,305 2019 5,064 2020 3,986 2021 2,844 Thereafter 4,998 Total $ 26,510 |
Accrued Employee Compensation | Accrued employee compensation expense consists of the following: January 31, 2017 July 31, 2016 (in thousands) Accrued bonuses $ 11,298 $ 24,872 Accrued commission 1,006 2,571 Accrued vacation 8,966 9,067 Accrued payroll taxes and benefits 4,492 4,757 Total $ 25,762 $ 41,267 |
Deferred Revenues | Deferred revenues, current and non-current, consist of the following: January 31, 2017 July 31, 2016 (in thousands) Deferred license and other revenues $ 29,864 $ 19,841 Deferred maintenance revenues 37,076 38,928 Deferred services revenues 22,406 11,246 Total $ 89,346 $ 70,015 |
Components of Accumulated Other Comprehensive Loss | Changes in accumulated other comprehensive loss by component during the six months ended January 31, 2017 were as follows: Foreign Currency Translation Adjustments Unrealized Gain (Loss) on Available-for-Sale Securities Total (in thousands) Balance as of July 31, 2016 $ (6,809 ) $ 216 $ (6,593 ) Other comprehensive gain (loss) before reclassification (837 ) (676 ) (1,513 ) Amounts reclassified from accumulated other comprehensive loss to earnings — (59 ) (59 ) Tax effect — 275 275 Balance as of January 31, 2017 $ (7,646 ) $ (244 ) $ (7,890 ) |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 6 Months Ended |
Jan. 31, 2017 | |
Earnings Per Share [Abstract] | |
Company's basic and diluted earnings per share | The following table sets forth the computation of the Company’s basic and diluted net income (loss) per share for the periods presented: Three Months Ended January 31, Six Months Ended January 31, 2017 2016 2017 2016 (in thousands, except share and per share amounts) Numerator: Net Income (loss) $ 3,974 $ 913 $ (3,884 ) $ (717 ) Net income (loss) per share: Basic $ 0.05 $ 0.01 $ (0.05 ) $ (0.01 ) Diluted $ 0.05 $ 0.01 $ (0.05 ) $ (0.01 ) Denominator: Weighted average shares used in computing net income (loss) per share: Basic 73,738,810 71,779,496 73,516,140 71,511,198 Weighted average effect of dilutive stock options 602,839 904,867 — — Weighted average effect of dilutive restricted stock units 451,591 717,701 — — Diluted 74,793,240 73,402,064 73,516,140 71,511,198 |
Schedule of Antidilutive Securities excluded from EPS | The following weighted shares outstanding of potential common stock were excluded from the computation of diluted income (loss) per share for the periods presented because including them would have been antidilutive: Three Months Ended January 31, Six Months Ended January 31, 2017 2016 2017 2016 Stock options to purchase common stock 59,323 77,975 1,009,969 1,574,949 Restricted stock units 832,650 283 3,119,079 3,346,340 |
Stockholders' Equity and Stoc22
Stockholders' Equity and Stock-based Compensation (Tables) | 6 Months Ended |
Jan. 31, 2017 | |
Stockholders' Equity and Stock-based Compensation [Abstract] | |
Stock-based compensation expense | Stock-based compensation expense related to stock-based awards is included in the Company’s condensed consolidated statements of operations as follows: Three Months Ended January 31, Six Months Ended January 31, 2017 2016 2017 2016 (in thousands) Total cost of stock-based compensation $ 18,807 $ 16,545 $ 36,911 $ 31,692 Amount capitalized in deferred cost of services revenues during the period (220 ) — (447 ) — Amount charged to income $ 18,587 $ 16,545 $ 36,464 $ 31,692 Stock-based compensation cost charged to the following expense categories: Cost of license revenues $ 90 $ 103 $ 141 $ 192 Cost of maintenance revenues 436 380 849 719 Cost of services revenues 4,815 4,673 9,510 9,036 Research and development 4,650 3,911 9,117 7,583 Sales and marketing 4,283 3,616 8,506 7,046 General and administrative 4,313 3,862 8,341 7,116 Total stock-based compensation expenses $ 18,587 $ 16,545 $ 36,464 $ 31,692 |
Unrecognized compensation cost, adjusted for estimated forfeitures | As of January 31, 2017 , total unamortized stock-based compensation cost, adjusted for estimated forfeitures, was as follows: As of January 31, 2017 Unrecognized Expense Weighted Average Expected Recognition Period (in thousands) (in years) Stock options $ 1,725 1.4 Restricted stock units 138,758 2.5 $ 140,483 |
Schedule of Share-based Compensation, Restricted Stock Units Award Activity | RSU, PSU and TSR PSU activity under the Company’s equity incentive plans is as follows: RSUs Outstanding Number of RSUs Outstanding Weighted Average Grant Date Fair Value Aggregate Intrinsic Value (in thousands) (1) Balance as of July 31, 2016 2,727,724 $ 50.08 $ 167,673 Granted 1,219,045 $ 61.30 Released (732,214 ) $ 48.19 $ 41,639 Canceled (103,554 ) $ 52.27 Balance as of January 31, 2017 3,111,001 $ 54.85 $ 162,799 Expected to vest as of January 31, 2017 2,888,757 $ 54.57 $ 151,169 |
Schedule of Share-based Compensation, Stock Options, Activity | Stock option activity under the Company’s equity incentive plans is as follows: Stock Options Outstanding Number of Stock Options Outstanding Weighted Average Exercise Price Weighted Average Remaining Contractual Life Aggregate Intrinsic Value (1) (in years) (in thousands) Balance as of July 31, 2016 1,158,572 $ 15.45 4.0 $ 53,316 Granted — Exercised (176,251 ) $ 11.54 $ 8,121 Canceled — Balance as of January 31, 2017 982,321 $ 16.15 3.5 $ 35,575 Vested and expected to vest as of January 31, 2017 980,137 $ 16.08 3.5 $ 35,566 Exercisable as of January 31, 2017 886,629 $ 12.77 3.1 $ 35,096 (1) Aggregate intrinsic value at each period end represents the difference between the Company's closing stock prices of $52.33 and $61.47 on January 31, 2017 and July 31, 2016 , respectively, and the exercise price of outstanding options. |
Schedule of Valuation Assumptions Using Monte Carlo Simulation Model | Three Months Ended January 31, Six Months Ended January 31, 2017 2016 2017 2016 Expected term (in years) 2.66 * 2.66 - 2.88 * Risk-free interest rate 1.34% * 0.89% - 1.34% * Expected volatility of the Company 30.2% * 30.2% - 31.5% * Average expected volatility of the peer companies in the index 36.9% * 36.9% - 37.0% * Expected dividend yield —% * —% * * There were no TSR PSUs granted during the three and six months ended January 31, 2016 . |
Common Stock Reserved for Issuance | As of January 31, 2017 and July 31, 2016 , the Company had reserved shares of common stock for future issuance as follows: January 31, 2017 July 31, 2016 Exercise of stock options to purchase common stock 982,321 1,158,572 Vesting of restricted stock units 3,111,001 2,727,724 Shares available under stock plans 19,326,561 16,746,754 Total common stock reserved for issuance 23,419,883 20,633,050 |
Segment Information (Tables)
Segment Information (Tables) | 6 Months Ended |
Jan. 31, 2017 | |
Segment Reporting [Abstract] | |
Revenues by country | The following table sets forth revenues by country and region based on the billing address of the customer: Three Months Ended January 31, Six Months Ended January 31, 2017 2016 2017 2016 (in thousands) United States $ 64,506 $ 62,078 $ 111,355 $ 105,185 Canada 14,355 7,091 28,849 16,149 Other Americas 3,872 2,178 9,096 4,627 Total Americas 82,733 71,347 149,300 125,961 United Kingdom 9,574 11,973 17,964 21,660 Other EMEA 8,809 5,303 17,750 12,178 Total EMEA 18,383 17,276 35,714 33,838 Total APAC 14,505 13,506 24,734 24,610 Total revenues $ 115,621 $ 102,129 $ 209,748 $ 184,409 |
Property and equipment, net by geographic region | The following table sets forth the Company’s long-lived assets, including intangibles and goodwill, net by geographic region: January 31, 2017 July 31, 2016 (in thousands) Americas $ 80,531 $ 53,826 EMEA 3,110 3,085 APAC 212 328 Total $ 83,853 $ 57,239 |
The Company and Summary of Si24
The Company and Summary of Significant Accounting Policies and Estimates (Details Textual) - customer | 3 Months Ended | 6 Months Ended | |||
Jan. 31, 2017 | Jan. 31, 2016 | Jan. 31, 2017 | Jan. 31, 2016 | Jul. 31, 2016 | |
Company and Summary of Significant Accounting Policies and Estimates (Textual) [Abstract] | |||||
Number of Customers Concentration Of Credit Risk | 0 | 0 | 0 | 0 | |
Percentage of Revenue | 10.00% | 10.00% | 10.00% | 10.00% | |
Number of Customers Concentration of Credit Risk Receivables | 0 | 0 | 0 | ||
Percentage of accounts receivable | 10.00% | 10.00% | 10.00% | ||
Restricted Stock Units (RSUs) | |||||
Company and Summary of Significant Accounting Policies and Estimates (Textual) [Abstract] | |||||
Period of time based Vesting | 4 years | ||||
TSR PSUs | |||||
Company and Summary of Significant Accounting Policies and Estimates (Textual) [Abstract] | |||||
Period of time based Vesting | 3 years | ||||
Minimum | |||||
Company and Summary of Significant Accounting Policies and Estimates (Textual) [Abstract] | |||||
Range of General Payment Terms | 30 days | ||||
Maximum | |||||
Company and Summary of Significant Accounting Policies and Estimates (Textual) [Abstract] | |||||
Range of General Payment Terms | 90 days |
Fair Value of Financial Instr25
Fair Value of Financial Instruments (Details 1) - USD ($) $ in Thousands | Jan. 31, 2017 | Jul. 31, 2016 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized Cost | $ 687,223 | $ 692,887 |
Unrealized Gains | 146 | 430 |
Unrealized Losses | (508) | (58) |
Total assets | 686,861 | 693,259 |
U.S. agency securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized Cost | 39,665 | 58,070 |
Unrealized Gains | 5 | 30 |
Unrealized Losses | (57) | (12) |
Total assets | 39,613 | 58,088 |
Commercial paper | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized Cost | 151,597 | 152,317 |
Unrealized Gains | 4 | 12 |
Unrealized Losses | (19) | (6) |
Total assets | 151,582 | 152,323 |
Corporate bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized Cost | 273,835 | 274,656 |
Unrealized Gains | 111 | 321 |
Unrealized Losses | (281) | (38) |
Total assets | 273,665 | 274,939 |
U.S. government bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized Cost | 81,212 | 90,593 |
Unrealized Gains | 2 | 58 |
Unrealized Losses | (141) | (2) |
Total assets | 81,073 | 90,649 |
Money market funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized Cost | 109,007 | 114,833 |
Unrealized Gains | 0 | 0 |
Unrealized Losses | 0 | 0 |
Total assets | 109,007 | 114,833 |
Foreign government bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized Cost | 2,419 | 2,418 |
Unrealized Gains | 0 | 9 |
Unrealized Losses | (7) | 0 |
Total assets | 2,412 | $ 2,427 |
Certificates of deposit | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized Cost | 29,488 | |
Unrealized Gains | 24 | |
Unrealized Losses | (3) | |
Total assets | $ 29,509 |
Fair Value of Financial Instr26
Fair Value of Financial Instruments (Details 2) $ in Thousands | Jan. 31, 2017USD ($)investment |
Fair Value, Assets Measured on Recurring and Nonrecurring Basis, Alternative [Abstract] | |
Less than Twelve Months, Fair Value | $ 321,777 |
Less than 12 Months, Aggregate Losses | (507) |
Twelve Months or Longer, Fair Value | 3,250 |
12 Months or Longer, Aggregate Losses | (1) |
Fair Value | 325,027 |
Aggregate Losses | $ (508) |
Number of Positions | investment | 129 |
U.S. agency securities | |
Fair Value, Assets Measured on Recurring and Nonrecurring Basis, Alternative [Abstract] | |
Less than Twelve Months, Fair Value | $ 24,506 |
Less than 12 Months, Aggregate Losses | (57) |
Twelve Months or Longer, Fair Value | 0 |
12 Months or Longer, Aggregate Losses | 0 |
Fair Value | 24,506 |
Aggregate Losses | (57) |
Commercial paper | |
Fair Value, Assets Measured on Recurring and Nonrecurring Basis, Alternative [Abstract] | |
Less than Twelve Months, Fair Value | 39,357 |
Less than 12 Months, Aggregate Losses | (19) |
Twelve Months or Longer, Fair Value | 0 |
12 Months or Longer, Aggregate Losses | 0 |
Fair Value | 39,357 |
Aggregate Losses | (19) |
Corporate bonds | |
Fair Value, Assets Measured on Recurring and Nonrecurring Basis, Alternative [Abstract] | |
Less than Twelve Months, Fair Value | 178,440 |
Less than 12 Months, Aggregate Losses | (280) |
Twelve Months or Longer, Fair Value | 3,250 |
12 Months or Longer, Aggregate Losses | (1) |
Fair Value | 181,690 |
Aggregate Losses | (281) |
U.S. government bonds | |
Fair Value, Assets Measured on Recurring and Nonrecurring Basis, Alternative [Abstract] | |
Less than Twelve Months, Fair Value | 71,574 |
Less than 12 Months, Aggregate Losses | (141) |
Twelve Months or Longer, Fair Value | 0 |
12 Months or Longer, Aggregate Losses | 0 |
Fair Value | 71,574 |
Aggregate Losses | (141) |
Foreign government bonds | |
Fair Value, Assets Measured on Recurring and Nonrecurring Basis, Alternative [Abstract] | |
Less than Twelve Months, Fair Value | 2,412 |
Less than 12 Months, Aggregate Losses | (7) |
Twelve Months or Longer, Fair Value | 0 |
12 Months or Longer, Aggregate Losses | 0 |
Fair Value | 2,412 |
Aggregate Losses | (7) |
Municipal Bonds [Member] | |
Fair Value, Assets Measured on Recurring and Nonrecurring Basis, Alternative [Abstract] | |
Less than Twelve Months, Fair Value | 5,488 |
Less than 12 Months, Aggregate Losses | (3) |
Twelve Months or Longer, Fair Value | 0 |
12 Months or Longer, Aggregate Losses | 0 |
Fair Value | 5,488 |
Aggregate Losses | $ (3) |
Fair Value of Financial Instr27
Fair Value of Financial Instruments (Details 3) - USD ($) $ in Thousands | Jan. 31, 2017 | Jul. 31, 2016 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Less than 12 Months | $ 540,736 | |
12 Months or Greater | 146,125 | |
Estimated Fair Value | 686,861 | $ 693,259 |
U.S. agency securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Less than 12 Months | 20,986 | |
12 Months or Greater | 18,627 | |
Estimated Fair Value | 39,613 | 58,088 |
Commercial paper | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Less than 12 Months | 151,582 | |
12 Months or Greater | 0 | |
Estimated Fair Value | 151,582 | 152,323 |
Corporate bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Less than 12 Months | 191,637 | |
12 Months or Greater | 82,028 | |
Estimated Fair Value | 273,665 | 274,939 |
U.S. government bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Less than 12 Months | 38,015 | |
12 Months or Greater | 43,058 | |
Estimated Fair Value | 81,073 | 90,649 |
Foreign government bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Less than 12 Months | 0 | |
12 Months or Greater | 2,412 | |
Estimated Fair Value | 2,412 | 2,427 |
Money market funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Less than 12 Months | 109,007 | |
12 Months or Greater | 0 | |
Estimated Fair Value | 109,007 | $ 114,833 |
Certificates of deposit | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Less than 12 Months | 29,509 | |
12 Months or Greater | 0 | |
Estimated Fair Value | $ 29,509 |
Fair Value of Financial Instr28
Fair Value of Financial Instruments (Details 4) - USD ($) $ in Thousands | Jan. 31, 2017 | Jul. 31, 2016 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets | $ 686,861 | $ 693,259 |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets | 109,007 | 114,833 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets | 577,854 | 578,426 |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets | 0 | 0 |
Money market funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents: | 114,833 | |
Total assets | 109,007 | 114,833 |
Money market funds | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents: | 114,833 | |
Money market funds | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents: | 0 | |
Money market funds | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents: | 0 | |
U.S. agency securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments: | 20,987 | 51,539 |
Long-term investments: | 18,626 | 6,549 |
Total assets | 39,613 | 58,088 |
U.S. agency securities | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments: | 0 | 0 |
Long-term investments: | 0 | 0 |
U.S. agency securities | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments: | 20,987 | 51,539 |
Long-term investments: | 18,626 | 6,549 |
U.S. agency securities | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments: | 0 | 0 |
Long-term investments: | 0 | 0 |
Commercial paper | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents: | 66,206 | |
Short-term investments: | 77,295 | 86,117 |
Total assets | 151,582 | 152,323 |
Commercial paper | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents: | 0 | |
Short-term investments: | 0 | 0 |
Commercial paper | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents: | 66,206 | |
Short-term investments: | 77,295 | 86,117 |
Commercial paper | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents: | 0 | |
Short-term investments: | 0 | 0 |
U.S. government bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments: | 38,015 | 61,565 |
Long-term investments: | 43,058 | 29,084 |
Total assets | 81,073 | 90,649 |
U.S. government bonds | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments: | 0 | 0 |
Long-term investments: | 0 | 0 |
U.S. government bonds | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments: | 38,015 | 61,565 |
Long-term investments: | 43,058 | 29,084 |
U.S. government bonds | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments: | 0 | 0 |
Long-term investments: | 0 | 0 |
Foreign government bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term investments: | 2,412 | 2,427 |
Total assets | 2,412 | 2,427 |
Foreign government bonds | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term investments: | 0 | 0 |
Foreign government bonds | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term investments: | 2,412 | 2,427 |
Foreign government bonds | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term investments: | 0 | 0 |
Corporate bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments: | 191,636 | 205,434 |
Long-term investments: | 82,029 | 69,505 |
Total assets | 273,665 | 274,939 |
Corporate bonds | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments: | 0 | 0 |
Long-term investments: | 0 | 0 |
Corporate bonds | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments: | 191,636 | 205,434 |
Long-term investments: | 82,029 | 69,505 |
Corporate bonds | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments: | 0 | 0 |
Long-term investments: | 0 | 0 |
Certificates of deposit | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments: | 29,509 | |
Total assets | 29,509 | |
Certificates of deposit | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments: | 0 | |
Certificates of deposit | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments: | 29,509 | |
Certificates of deposit | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments: | 0 | |
Commercial paper | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents: | 74,287 | |
Commercial paper | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents: | 0 | |
Commercial paper | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents: | 74,287 | |
Commercial paper | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents: | 0 | |
Money market funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents: | 109,007 | |
Money market funds | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents: | 109,007 | |
Money market funds | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents: | 0 | |
Money market funds | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents: | 0 | |
Preferred Stock | Other Noncurrent Assets | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cost Method Investments, Fair Value Disclosure | $ 6,000 | $ 6,000 |
Acquisition - Purchase Price (D
Acquisition - Purchase Price (Details) - USD ($) $ in Thousands | Aug. 31, 2016 | Jan. 31, 2017 | Jul. 31, 2016 |
Business Acquisition [Line Items] | |||
Acquired assets, net of assumed liabilities | $ 2,518 | ||
Deferred tax assets, net | 4,330 | ||
Goodwill | 15,525 | $ 45,605 | $ 30,080 |
Total purchase price | 37,773 | ||
Developed technology | |||
Business Acquisition [Line Items] | |||
Finite lived assets acquired | $ 8,000 | ||
Estimated Useful Lives | 5 years | ||
Customer contracts and related relationships | |||
Business Acquisition [Line Items] | |||
Finite lived assets acquired | $ 6,500 | ||
Estimated Useful Lives | 9 years | ||
Order backlog | |||
Business Acquisition [Line Items] | |||
Finite lived assets acquired | $ 900 | ||
Estimated Useful Lives | 3 years |
Acquisition Narrative (Details)
Acquisition Narrative (Details) - USD ($) | Aug. 31, 2016 | Jan. 31, 2017 | Jul. 31, 2016 | Mar. 31, 2016 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 15,525,000 | $ 45,605,000 | $ 30,080,000 | |
FirstBest Systems, Inc [Member] | ||||
Business Acquisition [Line Items] | ||||
Business Combination, Consideration Transferred | 37,800,000 | |||
Goodwill expected to be deductible for income tax purposes | $ 0 | |||
FirstBest Systems, Inc [Member] | General and Administrative Expense [Member] | ||||
Business Acquisition [Line Items] | ||||
Acquisition-related costs | $ 1,200,000 | $ 900,000 | $ 300,000 |
Balance Sheet Components (Detai
Balance Sheet Components (Details 1) - USD ($) $ in Thousands | Jan. 31, 2017 | Jul. 31, 2016 |
Balance Sheet Related Disclosures [Abstract] | ||
Computer hardware | $ 20,512 | $ 19,257 |
Software | 5,271 | 5,066 |
Furniture and fixtures | 3,545 | 3,492 |
Leasehold improvements | 8,339 | 8,434 |
Total property and equipment | 37,667 | 36,249 |
Less accumulated depreciation | (25,929) | (23,294) |
Property, Plant and Equipment, Net | $ 11,738 | $ 12,955 |
Balance Sheet Components (Det32
Balance Sheet Components (Details 2) $ in Thousands | 6 Months Ended |
Jan. 31, 2017USD ($) | |
Goodwill [Roll Forward] | |
Balance at beginning of period | $ 30,080 |
Addition - FirstBest acquisition | 15,525 |
Balance at end of period | $ 45,605 |
Balance Sheet Components (Det33
Balance Sheet Components (Details 3) - USD ($) $ in Thousands | Jan. 31, 2017 | Jul. 31, 2016 |
Finite-Lived Intangible Assets [Line Items] | ||
Cost | $ 35,100 | $ 19,700 |
Accumulated Amortization | 8,590 | 5,496 |
Net Book Value | 26,510 | 14,204 |
Acquired technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 21,900 | 13,900 |
Accumulated Amortization | 7,423 | 5,199 |
Net Book Value | 14,477 | 8,701 |
Customer contracts and related relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 11,000 | 4,500 |
Accumulated Amortization | 718 | 167 |
Net Book Value | 10,282 | 4,333 |
Partner relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 200 | 200 |
Accumulated Amortization | 18 | 8 |
Net Book Value | 182 | 192 |
Order backlog | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 2,000 | 1,100 |
Accumulated Amortization | 431 | 122 |
Net Book Value | $ 1,569 | $ 978 |
Balance Sheet Components (Det34
Balance Sheet Components (Details 4) - USD ($) $ in Thousands | Jan. 31, 2017 | Jul. 31, 2016 |
Balance Sheet Related Disclosures [Abstract] | ||
2017 (remainder of fiscal year) | $ 3,313 | |
2,018 | 6,305 | |
2,019 | 5,064 | |
2,020 | 3,986 | |
2,021 | 2,844 | |
Thereafter | 4,998 | |
Net Book Value | $ 26,510 | $ 14,204 |
Balance Sheet Components (Det35
Balance Sheet Components (Details 5) - USD ($) $ in Thousands | Jan. 31, 2017 | Jul. 31, 2016 |
Balance Sheet Related Disclosures [Abstract] | ||
Accrued bonuses | $ 11,298 | $ 24,872 |
Accrued commission | 1,006 | 2,571 |
Accrued vacation | 8,966 | 9,067 |
Accrued payroll taxes and benefits | 4,492 | 4,757 |
Total | $ 25,762 | $ 41,267 |
Balance Sheet Components (Det36
Balance Sheet Components (Details 6) - USD ($) $ in Thousands | Jan. 31, 2017 | Jul. 31, 2016 |
Deferred Revenue Arrangement [Line Items] | ||
Deferred revenues | $ 89,346 | $ 70,015 |
Deferred license and other revenues | ||
Deferred Revenue Arrangement [Line Items] | ||
Deferred revenues | 29,864 | 19,841 |
Deferred maintenance revenues | ||
Deferred Revenue Arrangement [Line Items] | ||
Deferred revenues | 37,076 | 38,928 |
Deferred services revenues | ||
Deferred Revenue Arrangement [Line Items] | ||
Deferred revenues | $ 22,406 | $ 11,246 |
Balance Sheet Components (Det37
Balance Sheet Components (Details 7) $ in Thousands | 6 Months Ended |
Jan. 31, 2017USD ($) | |
Increase (Decrease) in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |
Balance at beginning of period | $ (6,593) |
Other comprehensive gain (loss) before reclassification | (1,513) |
Amounts reclassified from accumulated other comprehensive loss to earnings | 59 |
Tax effect | (275) |
Balance at end of period | (7,890) |
Accumulated Translation Adjustment [Member] | |
Increase (Decrease) in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |
Balance at beginning of period | (6,809) |
Other comprehensive gain (loss) before reclassification | (837) |
Amounts reclassified from accumulated other comprehensive loss to earnings | 0 |
Tax effect | 0 |
Balance at end of period | (7,646) |
Unrealized Gain (Loss) on Available-for-Sale Securities [Member] | |
Increase (Decrease) in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |
Balance at beginning of period | 216 |
Other comprehensive gain (loss) before reclassification | (676) |
Amounts reclassified from accumulated other comprehensive loss to earnings | 59 |
Tax effect | (275) |
Balance at end of period | $ (244) |
Balance Sheet Components (Det38
Balance Sheet Components (Details Textual) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jan. 31, 2017 | Jan. 31, 2016 | Jan. 31, 2017 | Jan. 31, 2016 | Jul. 31, 2016 | |
Deferred Revenue Arrangement [Line Items] | |||||
Property and equipment pledged as collateral | $ 0 | $ 0 | $ 0 | ||
Depreciation | 1,700,000 | $ 1,400,000 | 3,300,000 | $ 2,800,000 | |
Amortization expense | 1,700,000 | $ 400,000 | 3,100,000 | $ 700,000 | |
Deferred revenues | 89,346,000 | 89,346,000 | 70,015,000 | ||
Deferred services revenues | |||||
Deferred Revenue Arrangement [Line Items] | |||||
Deferred revenues | 22,406,000 | 22,406,000 | 11,246,000 | ||
Deferred services revenues | One customer | |||||
Deferred Revenue Arrangement [Line Items] | |||||
Deferred revenues | 14,900,000 | 14,900,000 | 5,100,000 | ||
Preferred Stock | Other Noncurrent Assets | |||||
Deferred Revenue Arrangement [Line Items] | |||||
Carrying value | $ 6,000,000 | $ 6,000,000 | $ 6,000,000 |
Net Loss Per Share (Details 1)
Net Loss Per Share (Details 1) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jan. 31, 2017 | Jan. 31, 2016 | Jan. 31, 2017 | Jan. 31, 2016 | |
Numerator: | ||||
Net loss | $ 3,974 | $ 913 | $ (3,884) | $ (717) |
Net income (loss) per share: | ||||
Basic | $ 0.05 | $ 0.01 | $ (0.05) | $ (0.01) |
Diluted | $ 0.05 | $ 0.01 | $ (0.05) | $ (0.01) |
Weighted average shares used in computing net income (loss) per share: | ||||
Basic | 73,738,810 | 71,779,496 | 73,516,140 | 71,511,198 |
Weighted average effect of dilutive stock options | 602,839 | 904,867 | 0 | 0 |
Weighted average effect of dilutive restricted stock units | 451,591 | 717,701 | 0 | 0 |
Diluted | 74,793,240 | 73,402,064 | 73,516,140 | 71,511,198 |
Net Loss Per Share (Details 2)
Net Loss Per Share (Details 2) - shares | 3 Months Ended | 6 Months Ended | ||
Jan. 31, 2017 | Jan. 31, 2016 | Jan. 31, 2017 | Jan. 31, 2016 | |
Stock options to purchase common stock | ||||
Net Income (Loss) Per Share (Textual) [Abstract] | ||||
Schedule of antidilutive securities excluded from EPS | 59,323 | 77,975 | 1,009,969 | 1,574,949 |
Restricted stock units | ||||
Net Income (Loss) Per Share (Textual) [Abstract] | ||||
Schedule of antidilutive securities excluded from EPS | 832,650 | 283 | 3,119,079 | 3,346,340 |
Commitments and Contingencies (
Commitments and Contingencies (Details Textual) $ in Millions | 3 Months Ended | 6 Months Ended | |||||||
Jan. 31, 2017USD ($) | Jan. 31, 2016USD ($) | Jan. 31, 2017USD ($) | Jan. 31, 2016USD ($) | Jan. 31, 2017PLNft² | Jan. 31, 2017USD ($)ft² | Jul. 31, 2016letter_of_credit | Jul. 01, 2015USD ($) | Aug. 01, 2012USD ($) | |
Line of Credit Facility [Line Items] | |||||||||
Duration of lease for a facility to serve as its corporate headquarters | 7 years | ||||||||
Rentable area of current corporate headquarters | ft² | 97,674 | 97,674 | |||||||
Line of Credit Facility, Maximum Borrowing Capacity | PLN | PLN 10,000,000 | ||||||||
Lease expense for all worldwide facilities and equipment | $ 1.6 | $ 1.4 | $ 3.1 | $ 2.8 | |||||
Number of Unsecured Credit Facilities Outstanding | letter_of_credit | 2 | ||||||||
Line of Credit Facility, Current Borrowing Capacity | $ 2.5 | ||||||||
Line of Credit Associated With Operating Lease | |||||||||
Line of Credit Facility [Line Items] | |||||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 1.2 | ||||||||
Line of Credit Associated With Operating Lease [Member] | |||||||||
Line of Credit Facility [Line Items] | |||||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 0.4 |
Stockholders' Equity and Stoc42
Stockholders' Equity and Stock-based Compensation (Details 1) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jan. 31, 2017 | Jan. 31, 2016 | Jan. 31, 2017 | Jan. 31, 2016 | |
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost | $ 18,807 | $ 16,545 | $ 36,911 | $ 31,692 |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs, Capitalized Amount | (220) | 0 | (447) | 0 |
Allocated Share-based Compensation Expense | 18,587 | 16,545 | 36,464 | 31,692 |
Total stock-based compensation expenses | 18,587 | 16,545 | 36,464 | 31,692 |
Unrecognized Expense | 140,483 | 140,483 | ||
Cost of license revenues | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation expenses | 90 | 103 | 141 | 192 |
Cost of maintenance revenues | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation expenses | 436 | 380 | 849 | 719 |
Cost of services revenues | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation expenses | 4,815 | 4,673 | 9,510 | 9,036 |
Research and development | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation expenses | 4,650 | 3,911 | 9,117 | 7,583 |
Sales and marketing | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation expenses | 4,283 | 3,616 | 8,506 | 7,046 |
General and administrative | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation expenses | 4,313 | $ 3,862 | 8,341 | $ 7,116 |
Stock Options | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Unrecognized Expense | 1,725 | $ 1,725 | ||
Average Expected Recognition Period | 1 year 4 months 24 days | |||
Restricted Stock Units (RSUs) | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Unrecognized Expense | $ 138,758 | $ 138,758 | ||
Average Expected Recognition Period | 2 years 6 months |
Stockholders' Equity and Stoc43
Stockholders' Equity and Stock-based Compensation (Details 2) - USD ($) $ / shares in Units, $ in Thousands | 6 Months Ended | 12 Months Ended |
Jan. 31, 2017 | Jul. 31, 2016 | |
Number of Stock Options Outstanding | ||
Balance at beginning of period | 1,158,572 | |
Granted | 0 | |
Exercised | (176,251) | |
Canceled | 0 | |
Balance at end of period | 982,321 | 1,158,572 |
Vested and expected to vest as of January 31, 2017 | 980,137 | |
Exercisable as of January 31, 2017 | 886,629 | |
Weighted Average Exercise Price | ||
Balance at beginning of period | $ 15.45 | |
Exercised | 11.54 | |
Balance at end of period | 16.15 | $ 15.45 |
Vested and expected to vest as of January 31, 2017 | 16.08 | |
Exercisable as of January 31, 2017 | $ 12.77 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | ||
Weighted Average Remaining Contractual Life | 3 years 6 months | 4 years 11 days |
Vested and expected to vest as of January 31, 2017 | 3 years 6 months | |
Exercisable as of January 31, 2017 | 3 years 1 month 6 days | |
Share-based Compensation Arrangement by Share-based Payment Award, Aggregate Intrinsic Value [Abstract] | ||
Aggregate intrinsic value | $ 35,575 | $ 53,316 |
Exercised | 8,121 | |
Vested and expected to vest as of January 31, 2017 | 35,566 | |
Exercisable as of January 31, 2017 | $ 35,096 | |
Share Price | $ 52.33 | $ 61.47 |
Restricted Stock Units (RSUs) | ||
Number of RSUs Outstanding | ||
Balance at beginning of period | 2,727,724 | |
Granted | 1,219,045 | |
Released | (732,214) | |
Canceled | (103,554) | |
Balance at end of period | 3,111,001 | 2,727,724 |
Expected to vest as of October 31, 2015 | 2,888,757 | |
Weighted Average Grant Date Fair Value | ||
Balance at beginning of period | $ 50.08 | |
Granted | 61.30 | |
Released | 48.19 | |
Canceled | 52.27 | |
Balance at end of period | 54.85 | $ 50.08 |
Expected to vest as of October 31, 2015 | $ 54.57 | |
Aggregate intrinsic value, Nonvested | $ 162,799 | $ 167,673 |
Aggregate intrinsic value, Vested | 41,639 | |
Aggregate intrinsic value, Expected to vest | $ 151,169 |
Stockholders' Equity and Stoc44
Stockholders' Equity and Stock-based Compensation (Details 3) - TSR PSUs - shares | 3 Months Ended | 6 Months Ended | |
Jan. 31, 2017 | Jan. 31, 2017 | Jan. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Granted (in shares) | 0 | ||
Summary of assumptions for fair value of employee stock option estimates | |||
Risk-free interest rate, minimum | 1.34% | 0.89% | |
Risk-free interest rate, maximum | 1.34% | 1.34% | |
Expected volatility, minimum | 30.20% | 30.20% | |
Expected volatility, maximum | 30.20% | 31.50% | |
Expected volatility of peer companies, minimum | 36.90% | 36.90% | |
Expected volatility of peer companies, maximum | 36.90% | 37.00% | |
Expected dividend yield | 0.00% | 0.00% | |
Minimum | |||
Summary of assumptions for fair value of employee stock option estimates | |||
Expected life (in years) | 2 years 7 months 29 days | 2 years 7 months 29 days | |
Maximum | |||
Summary of assumptions for fair value of employee stock option estimates | |||
Expected life (in years) | 2 years 7 months 29 days | 2 years 10 months 17 days |
Stockholders' Equity and Stoc45
Stockholders' Equity and Stock-based Compensation (Details 4) - shares | Jan. 31, 2017 | Jul. 31, 2016 |
Common Stock Reserved for Issuance | ||
Exercise of stock options to purchase common stock | 982,321 | 1,158,572 |
Issuances of shares available under stock plans | 19,326,561 | 16,746,754 |
Total common stock reserved for issuance | 23,419,883 | 20,633,050 |
Restricted Stock Units (RSUs) | ||
Common Stock Reserved for Issuance | ||
Vesting of restricted stock units | 3,111,001 | 2,727,724 |
Stockholders' Equity and Stoc46
Stockholders' Equity and Stock-based Compensation (Details Textual) - USD ($) $ / shares in Units, $ in Thousands | 6 Months Ended | |
Jan. 31, 2017 | Jul. 31, 2016 | |
Class of Stock [Line Items] | ||
Options granted | 0 | |
Unrecognized Expense | $ 140,483 | |
Total intrinsic value of options exercised | $ 8,121 | |
Stockholders Equity and Stock Based Compensation (Additional Textual) [Abstract] | ||
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common Stock, Shares, Outstanding | 73,948,384 | 73,039,919 |
Restricted Stock Units (RSUs) | ||
Class of Stock [Line Items] | ||
Period of time based Vesting | 4 years | |
Unrecognized Expense | $ 138,758 | |
Weighted average grant date fair value | $ 61.30 | |
TSR PSUs | ||
Class of Stock [Line Items] | ||
Period of time based Vesting | 3 years |
Income Taxes (Details Textual)
Income Taxes (Details Textual) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jan. 31, 2017 | Jan. 31, 2016 | Jan. 31, 2017 | Jan. 31, 2016 | |
Income Tax Disclosure [Abstract] | ||||
Benefit from income taxes | $ 6,110 | $ 6,365 | $ (3,673) | $ (55) |
Effective Income Tax Rate, Continuing Operations | 61.00% | 49.00% | ||
Percentage of Statutory federal income tax rate | 35.00% | |||
Undistributed Earnings of Foreign Subsidiaries | $ 32,500 | $ 32,500 | ||
Undistributed earnings from certain foreign subsidiaries | 10,500 | 10,500 | ||
Unrecognized Tax Benefits, Period Increase (Decrease) | 1,500 | |||
Unrecognized tax benefits | $ 4,000 | $ 4,000 |
Segment Information (Details 1)
Segment Information (Details 1) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jan. 31, 2017USD ($) | Jan. 31, 2016USD ($) | Jan. 31, 2017USD ($)segment | Jan. 31, 2016USD ($) | |
Revenues by country | ||||
Number of operating segments | segment | 1 | |||
Revenues : | ||||
Total revenues | $ 115,621 | $ 102,129 | $ 209,748 | $ 184,409 |
United States | ||||
Revenues : | ||||
Total revenues | 64,506 | 62,078 | 111,355 | 105,185 |
Canada | ||||
Revenues : | ||||
Total revenues | 14,355 | 7,091 | 28,849 | 16,149 |
United Kingdom | ||||
Revenues : | ||||
Total revenues | 9,574 | 11,973 | 17,964 | 21,660 |
Other EMEA | ||||
Revenues : | ||||
Total revenues | 8,809 | 5,303 | 17,750 | 12,178 |
Other | ||||
Revenues : | ||||
Total revenues | 3,872 | 2,178 | 9,096 | 4,627 |
Americas | ||||
Revenues : | ||||
Total revenues | 82,733 | 71,347 | 149,300 | 125,961 |
EMEA | ||||
Revenues : | ||||
Total revenues | 18,383 | 17,276 | 35,714 | 33,838 |
APAC | ||||
Revenues : | ||||
Total revenues | $ 14,505 | $ 13,506 | $ 24,734 | $ 24,610 |
Segment Information (Details 2)
Segment Information (Details 2) - USD ($) $ in Thousands | Jan. 31, 2017 | Jul. 31, 2016 |
Long-lived asset, including intangibles and goodwill | ||
Total | $ 83,853 | $ 57,239 |
Americas | ||
Long-lived asset, including intangibles and goodwill | ||
Total | 80,531 | 53,826 |
EMEA | ||
Long-lived asset, including intangibles and goodwill | ||
Total | 3,110 | 3,085 |
APAC | ||
Long-lived asset, including intangibles and goodwill | ||
Total | $ 212 | $ 328 |
Subsequent Event (Details)
Subsequent Event (Details) - ISCS - Subsequent Event $ in Millions | Feb. 16, 2017USD ($)Participants |
Subsequent Event [Line Items] | |
Cash paid | $ | $ 160 |
Number of employees of acquired firm to be continually employed | Participants | 184 |