Cover Page
Cover Page - USD ($) $ in Billions | 12 Months Ended | ||
Jul. 31, 2021 | Aug. 31, 2021 | Jan. 31, 2021 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Jul. 31, 2021 | ||
Current Fiscal Year End Date | --07-31 | ||
Document Transition Report | false | ||
Entity File Number | 001-38413 | ||
Entity Registrant Name | ZSCALER, INC. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 26-1173892 | ||
Entity Address, Address Line One | 120 Holger Way | ||
Entity Address, City or Town | San Jose | ||
Entity Address, State or Province | CA | ||
Entity Address, Postal Zip Code | 95134 | ||
City Area Code | 408 | ||
Local Phone Number | 533-0288 | ||
Title of 12(b) Security | Common Stock, $0.001 Par Value | ||
Trading Symbol | ZS | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 20.4 | ||
Shares Outstanding | 138,735,981 | ||
Documents Incorporated by Reference | Portions of the registrant’s definitive Proxy Statement relating to its fiscal year 2021 Annual Meeting of Stockholders are incorporated by reference into Part III of this Form 10-K where indicated. Such Proxy Statement will be filed with the United States Securities and Exchange Commission within 120 days after the end of the fiscal year to which this Annual Report on Form 10-K relates. | ||
Entity Central Index Key | 0001713683 | ||
Document Fiscal Year Focus | 2021 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Jul. 31, 2021 | Jul. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 275,898 | $ 141,851 |
Short-term investments | 1,226,654 | 1,228,722 |
Accounts receivable, net | 257,109 | 147,584 |
Deferred contract acquisition costs | 57,373 | 32,240 |
Prepaid expenses and other current assets | 31,269 | 31,396 |
Total current assets | 1,848,303 | 1,581,793 |
Property and equipment, net | 108,576 | 75,734 |
Operating lease right-of-use assets | 44,339 | 36,119 |
Deferred contract acquisition costs, noncurrent | 149,657 | 77,675 |
Acquired intangible assets, net | 32,129 | 24,024 |
Goodwill | 58,977 | 30,059 |
Other noncurrent assets | 15,650 | 8,054 |
Total assets | 2,257,631 | 1,833,458 |
Current liabilities: | ||
Accounts payable | 12,547 | 5,233 |
Accrued expenses and other current liabilities | 22,908 | 16,361 |
Accrued compensation | 93,622 | 49,444 |
Deferred revenue | 571,286 | 337,263 |
Operating lease liabilities | 19,842 | 15,600 |
Total current liabilities | 720,205 | 423,901 |
Convertible senior notes, net | 913,538 | 861,615 |
Deferred revenue, noncurrent | 59,315 | 32,504 |
Operating lease liabilities, noncurrent | 31,225 | 28,023 |
Other noncurrent liabilities | 4,453 | 2,586 |
Total liabilities | 1,728,736 | 1,348,629 |
Commitments and contingencies (Note 11) | ||
Stockholders’ Equity | ||
Preferred stock; $0.001 par value; 200,000 shares authorized as of July 31, 2021 and 2020, respectively; no shares issued and outstanding as of July 31, 2021 and 2020 | 0 | 0 |
Common stock; $0.001 par value; 1,000,000 shares authorized as of July 31, 2021 and 2020, respectively; 138,662 and 132,817 shares issued and outstanding as of July 31, 2021 and 2020, respectively | 139 | 133 |
Additional paid-in capital | 1,131,006 | 823,804 |
Accumulated other comprehensive income (loss) | (650) | 463 |
Accumulated deficit | (601,600) | (339,571) |
Total stockholders’ equity | 528,895 | 484,829 |
Total liabilities and stockholders’ equity | $ 2,257,631 | $ 1,833,458 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Jul. 31, 2021 | Jul. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 200,000,000 | 200,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued (in shares) | 138,662,000 | 132,817,000 |
Common stock, shares outstanding (in shares) | 138,662,000 | 132,817,000 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2019 | |
Income Statement [Abstract] | |||
Revenue | $ 673,100 | $ 431,269 | $ 302,836 |
Cost of revenue | 150,317 | 95,733 | 59,669 |
Gross profit | 522,783 | 335,536 | 243,167 |
Operating expenses: | |||
Sales and marketing | 459,407 | 277,981 | 169,913 |
Research and development | 174,653 | 97,879 | 61,969 |
General and administrative | 96,535 | 73,632 | 46,598 |
Total operating expenses | 730,595 | 449,492 | 278,480 |
Loss from operations | (207,812) | (113,956) | (35,313) |
Interest income | 2,812 | 6,477 | 7,730 |
Interest expense | (53,364) | (5,025) | 0 |
Other income (expense), net | 1,186 | (224) | (329) |
Loss before income taxes | (257,178) | (112,728) | (27,912) |
Provision for income taxes | 4,851 | 2,388 | 743 |
Net loss | $ (262,029) | $ (115,116) | $ (28,655) |
Net loss per share, basic (in dollars per share) | $ (1.93) | $ (0.89) | $ (0.23) |
Net loss per share, diluted (in dollars per share) | $ (1.93) | $ (0.89) | $ (0.23) |
Weighted-average shares used in computing net loss per share, basic (in shares) | 135,654 | 129,323 | 123,566 |
Weighted-average shares used in computing net loss per share, diluted (in shares) | 135,654 | 129,323 | 123,566 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | ||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2019 | |
Statement of Comprehensive Income [Abstract] | |||
Net loss | $ (262,029) | $ (115,116) | $ (28,655) |
Available-for-sale securities: | |||
Change in net unrealized gains (losses) on available-for-sale securities | (486) | 195 | 392 |
Cash flow hedging instruments: | |||
Change in net unrealized gains and (losses) | (228) | 0 | 0 |
Net realized losses (gains) reclassified into net loss | (399) | 0 | 0 |
Net change on cash flow hedges | (627) | 0 | 0 |
Other comprehensive income (loss) | (1,113) | 195 | 392 |
Comprehensive loss | $ (263,142) | $ (114,921) | $ (28,263) |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands | Total | Cumulative effect of accounting change | Common Stock | Additional Paid-In Capital | Additional Paid-In CapitalCumulative effect of accounting change | Notes Receivable From Stockholders | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit | Accumulated DeficitCumulative effect of accounting change |
Common stock, beginning balance (in shares) at Jul. 31, 2018 | 119,764 | ||||||||
Beginning balance at Jul. 31, 2018 | $ 240,236 | $ 0 | $ 119 | $ 438,392 | $ (300) | $ (2,051) | $ (124) | $ (196,100) | $ 300 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Issuance of common stock upon exercise of stock options (in shares) | 6,277 | ||||||||
Issuance of common stock upon exercise of stock options | 29,862 | $ 7 | 29,855 | ||||||
Issuance of common stock under the employee stock purchase plan (in shares) | 1,131 | ||||||||
Issuance of common stock under the employee stock purchase plan | 16,436 | $ 1 | 16,435 | ||||||
Vesting of restricted stock units (in shares) | 89 | ||||||||
Repurchases of unvested common stock (in shares) | (8) | ||||||||
Repayments of principal amount on notes receivable from stockholders | 1,905 | 1,905 | |||||||
Accrued interest on notes receivable from stockholders, net of repayments | 146 | 146 | |||||||
Adjustment to initial public offering costs | 300 | 300 | |||||||
Vesting of early exercised stock options | 983 | 983 | |||||||
Stock-based compensation | 46,953 | 46,953 | |||||||
Other comprehensive income (loss) | 392 | 392 | |||||||
Net loss | (28,655) | (28,655) | |||||||
Common stock, ending balance (in shares) at Jul. 31, 2019 | 127,253 | ||||||||
Ending balance at Jul. 31, 2019 | 308,558 | $ 127 | 532,618 | 0 | 268 | (224,455) | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Issuance of common stock upon exercise of stock options (in shares) | 3,450 | ||||||||
Issuance of common stock upon exercise of stock options | 21,602 | $ 4 | 21,598 | ||||||
Issuance of common stock under the employee stock purchase plan (in shares) | 817 | ||||||||
Issuance of common stock under the employee stock purchase plan | 15,333 | $ 1 | 15,332 | ||||||
Vesting of restricted stock units (in shares) | 1,297 | ||||||||
Vesting of restricted stock units | 0 | $ 1 | (1) | ||||||
Vesting of early exercised stock options | 463 | 463 | |||||||
Stock-based compensation | 125,675 | 125,675 | |||||||
Equity component of convertible senior notes, net of deferred tax | 273,364 | 273,364 | |||||||
Purchases of capped calls related to convertible senior notes | (145,245) | (145,245) | |||||||
Other comprehensive income (loss) | 195 | 195 | |||||||
Net loss | $ (115,116) | (115,116) | |||||||
Common stock, ending balance (in shares) at Jul. 31, 2020 | 132,817 | 132,817 | |||||||
Ending balance at Jul. 31, 2020 | $ 484,829 | $ 133 | 823,804 | 0 | 463 | (339,571) | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Issuance of common stock upon exercise of stock options (in shares) | 2,466 | 2,466 | |||||||
Issuance of common stock upon exercise of stock options | $ 18,221 | $ 3 | 18,218 | ||||||
Issuance of common stock under the employee stock purchase plan (in shares) | 338 | ||||||||
Issuance of common stock under the employee stock purchase plan | 25,704 | 25,704 | |||||||
Vesting of restricted stock units (in shares) | 3,041 | ||||||||
Vesting of restricted stock units | 0 | $ 3 | (3) | ||||||
Vesting of early exercised stock options | 93 | 93 | |||||||
Stock-based compensation | 263,190 | 263,190 | |||||||
Other comprehensive income (loss) | (1,113) | (1,113) | |||||||
Net loss | $ (262,029) | (262,029) | |||||||
Common stock, ending balance (in shares) at Jul. 31, 2021 | 138,662 | 138,662 | |||||||
Ending balance at Jul. 31, 2021 | $ 528,895 | $ 139 | $ 1,131,006 | $ 0 | $ (650) | $ (601,600) |
Consolidated Statement of Cash
Consolidated Statement of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | |||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2019 | ||
Cash Flows From Operating Activities | ||||
Net loss | $ (262,029) | $ (115,116) | $ (28,655) | |
Adjustments to reconcile net loss to cash provided by operating activities: | ||||
Depreciation and amortization expense | 29,663 | 17,734 | 10,398 | |
Amortization expense of acquired intangible assets | 6,795 | 3,384 | 908 | |
Capitalized Contract Cost, Amortization | 40,558 | 24,922 | 18,651 | |
Amortization of debt discount and issuance costs | 51,923 | 4,885 | 0 | |
Non-cash operating lease costs | 20,995 | 13,555 | 0 | |
Stock-based compensation expense | 258,535 | 121,395 | 46,423 | |
Amortization (accretion) of investments purchased at a premium (discount) | 11,715 | 50 | (2,181) | |
Deferred income taxes | (2,406) | (1,172) | (1,392) | |
Impairment of assets | 416 | 746 | 0 | |
Other | 307 | 321 | 284 | |
Changes in operating assets and liabilities, net of effects of business acquisitions | ||||
Accounts receivable | (111,605) | (54,222) | (31,730) | |
Deferred contract acquisition costs | (137,673) | (65,052) | (32,526) | |
Prepaid expenses, other current and noncurrent assets | (3,388) | (13,580) | (7,642) | |
Accounts payable | 7,451 | 862 | 495 | |
Accrued expenses, other current and noncurrent liabilities | 6,532 | 2,292 | (336) | |
Accrued compensation | 43,877 | 27,900 | (1,849) | |
Deferred revenue | 262,425 | 118,017 | 87,179 | |
Operating lease liabilities | (22,051) | (7,604) | 0 | |
Net cash provided by operating activities | 202,040 | 79,317 | 58,027 | |
Cash Flows From Investing Activities | ||||
Purchases of property, equipment and other assets | (48,165) | (43,072) | (25,520) | |
Capitalized internal-use software | (10,132) | (8,737) | (3,162) | |
Acquired intangible assets | 0 | 0 | (1,480) | |
Payments for business acquisitions, net of cash acquired | (40,530) | (39,601) | (11,432) | |
Purchases of strategic investments | (3,077) | (2,000) | 0 | |
Purchases of short-term investments | (815,480) | (1,255,629) | (335,186) | |
Proceeds from maturities of short-term investments | 785,217 | 289,785 | 199,716 | |
Proceeds from sale of short-term investments | 22,499 | 21,092 | 14,990 | |
Net cash used in investing activities | (109,668) | (1,038,162) | (162,074) | |
Cash Flows From Financing Activities | ||||
Payments of offering costs related to initial public offering | 0 | 0 | (1,797) | |
Proceeds from issuance of common stock upon exercise of stock options | 18,221 | 21,602 | 29,862 | |
Proceeds from issuance of common stock under the employee stock purchase plan | 25,704 | 15,333 | 16,436 | |
Payment of deferred consideration related to a business acquisition | (2,250) | 0 | 0 | |
Proceeds from issuance of convertible senior notes, net of issuance costs | 0 | 1,130,522 | 0 | |
Purchases of capped calls related to convertible senior notes | 0 | (145,245) | 0 | |
Repurchases of unvested common stock | 0 | 0 | (22) | |
Repayments of notes receivable from stockholders | 0 | 0 | 1,905 | |
Net cash provided by financing activities | 41,675 | 1,022,212 | 46,384 | |
Net increase (decrease) in cash and cash equivalents | [1] | 134,047 | 63,367 | (57,663) |
Cash and cash equivalents at beginning of period | [1] | 141,851 | 78,484 | 136,147 |
Cash and cash equivalents at end of period | [1] | 275,898 | 141,851 | 78,484 |
Supplemental Disclosure of Cash Flow Information: | ||||
Cash paid for income taxes, net of tax refunds | 4,144 | 2,525 | 1,770 | |
Cash paid for interest expense | 1,462 | 0 | 0 | |
Non-cash activities | ||||
Net change in purchased equipment included in accounts payable and accrued expenses | 14 | (1,486) | 2,911 | |
Operating lease right-of-use assets obtained in exchange for operating lease obligations, net of terminations | 27,627 | 31,673 | 0 | |
Vesting of early exercised common stock options | 93 | 463 | 983 | |
Net change in deferred offering costs accrued | $ 0 | $ 0 | $ (2,097) | |
[1] | We did not hold restricted cash for any periods presented. |
Business and Summary of Signifi
Business and Summary of Significant Accounting Policies | 12 Months Ended |
Jul. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Business and Summary of Significant Accounting Policies | Business and Summary of Significant Accounting Policies Description of the Business Zscaler, Inc. ("Zscaler," the "Company," "we," "us," or "our") is a cloud security company that developed a platform incorporating core security functionalities needed to enable fast and secure access to cloud resources based on identity, context and organization’s policies. Our solution is a purpose-built, multi-tenant, distributed cloud platform that secures user-to-app, app-to-app, and machine-to-machine communications, over any network and any location. We deliver our solutions using a software-as-a-service ("SaaS") business model and sell subscriptions to customers to access our cloud platform, together with related support services. We were incorporated in Delaware in September 2007 and conduct business worldwide, with presence in North America, Europe and Asia. Our headquarters are in San Jose, California. Fiscal Year Our fiscal year ends on July 31. References to fiscal 2021, for example, refer to our fiscal year ended July 31, 2021. Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries and have been prepared in conformity with accounting principles generally accepted in the United States ("U.S. GAAP"). All intercompany balances and transactions have been eliminated in consolidation. Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the amounts reported and disclosed in the financial statements and accompanying notes. Such estimates include, but are not limited to, the determination of revenue recognition, deferred revenue, deferred contract acquisition costs, valuation of acquired intangible assets, period of benefit generated from our deferred contract acquisition costs, allowance for doubtful accounts, valuation of common stock options and stock-based awards, useful lives of property and equipment, useful lives of acquired intangible assets, recoverability of goodwill, valuation of deferred tax assets and liabilities, loss contingencies related to litigation, fair value and effective interest rate of convertible senior notes, valuation of non-marketable equity investments and the discount rate used for operating leases. Management determines these estimates and assumptions based on historical experience and on various other assumptions that are believed to be reasonable. Actual results could differ significantly from these estimates, and such differences may be material to the consolidated financial statements. Due to the COVID-19 pandemic, there is ongoing uncertainty and significant disruption in the global economy and financial markets. We are not aware of any specific event or circumstances that would require an update to our estimates, judgments or assumptions or a revision to the carrying value of our assets or liabilities as of the date of issuance of these consolidated financial statements. These estimates, judgments and assumptions may change in the future, as new events occur or additional information is obtained. Foreign Currency The functional currency of our foreign subsidiaries is the U.S. dollar. Accordingly, monetary assets and liabilities of our foreign subsidiaries are re-measured into U.S. dollars at the exchange rates in effect at the reporting date, non-monetary assets and liabilities are re-measured at historical rates, revenue and expenses are re-measured at average exchange rates in effect during each reporting period. Foreign currency transaction gains and losses are recorded in other income (expense), net in the consolidated statements of operations. Foreign currency remeasurement gains and losses and foreign currency transaction gains and losses are not significant to the consolidated financial statements. Concentration of Risks We generate revenue primarily from sale of subscriptions to access our cloud platform, together with related support services. Our sales team, along with our channel partner network of global telecommunications service providers, system integrators and value-added resellers (collectively "channel partners"), sells our services worldwide to organizations of all sizes. Due to the nature of our services and the terms and conditions of our contracts with our channel partners, our business could be affected unfavorably if we are not able to continue our relationships with them. Our financial instruments that are exposed to concentrations of credit risk consist primarily of cash, cash equivalents, short-term investments and accounts receivable. Although we deposit our cash with multiple financial institutions, the deposits, at times, may exceed federally insured limits. Cash equivalents and short-term investments consist of highly liquid investments in money market funds, U.S. treasury, U.S. agency securities and corporate debt securities, which are invested through financial institutions in the United States. We grant credit to our customers in the normal course of business. We monitor the financial condition of our customers to reduce credit risk. Refer to Note 2, Revenue Recognition, for information regarding customers with concentration of 10% or more of the total balance of accounts receivable, net. Segment Information We operate as one reportable and operating segment. Our chief operating decision maker is our chief executive officer, who reviews financial information presented on a consolidated basis for purposes of making operating decisions, assessing financial performance and allocating resources. Revenue Recognition In accordance with Accounting Standards Codification ("ASC") Topic 606, Revenue From Contracts With Customers ("ASC 606"), revenue is recognized when a customer obtains control of promised services. The amount of revenue recognized reflects the consideration that we expect to be entitled to receive in exchange for these services. To achieve the core principle of this standard, we apply the following five steps: 1) Identify the contract with a customer We consider the terms and conditions of the contracts and our customary business practices in identifying our contracts under ASC 606. We determine we have a contract with a customer when the contract is approved, we can identify each party’s rights regarding the services to be transferred, we can identify the payment terms for the services, we have determined the customer has the ability and intent to pay and the contract has commercial substance. We apply judgment in determining the customer’s ability and intent to pay, which is based on a variety of factors, including the customer’s historical payment experience or, in the case of a new customer, credit and financial information pertaining to the customer. 2) Identify the performance obligations in the contract Performance obligations promised in a contract are identified based on the services that will be transferred to the customer that are both capable of being distinct, whereby the customer can benefit from the service either on its own or together with other resources that are readily available from third parties or from us, and are distinct in the context of the contract, whereby the transfer of the services is separately identifiable from other promises in the contract. Our performance obligations consist of (i) our subscription and support services and (ii) professional and other services. 3) Determine the transaction price The transaction price is determined based on the consideration to which we expect to be entitled in exchange for transferring services to the customer. Variable consideration is included in the transaction price if, in our judgment, it is probable that a significant future reversal of cumulative revenue under the contract will not occur. None of our contracts contain a significant financing component. 4) Allocate the transaction price to performance obligations in the contract If the contract contains a single performance obligation, the entire transaction price is allocated to the single performance obligation. Contracts that contain multiple performance obligations require an allocation of the transaction price to each performance obligation based on a relative standalone selling price ("SSP"). 5) Recognize revenue when or as we satisfy a performance obligation Revenue is recognized at the time the related performance obligation is satisfied by transferring the promised service to a customer. Revenue is recognized when control of the services is transferred to our customers, in an amount that reflects the consideration that we expect to receive in exchange for those services. We generate all our revenue from contracts with customers and apply judgment in identifying and evaluating any terms and conditions in contracts which may impact revenue recognition. Subscription and Support Revenue We generate revenue primarily from sales of subscriptions to access our cloud platform, together with related support services to our customers. Arrangements with customers do not provide the customer with the right to take possession of our software operating our cloud platform at any time. Instead, customers are granted continuous access to our cloud platform over the contractual period. A time-elapsed output method is used to measure progress because we transfer control evenly over the contractual period. Accordingly, the fixed consideration related to subscription and support revenue is generally recognized on a straight-line basis over the contract term beginning on the date that our service is made available to the customer. The typical subscription and support term is one Professional and Other Services Revenue Professional and other services revenue consists of fees associated with providing deployment advisory services that educate and assist our customers on the best use of our solutions, as well as advise customers on best practices as they deploy our solution. These services are distinct from subscription and support services. Professional services do not result in significant customization of the subscription service. Revenue from professional services provided on a time and materials basis is recognized as the services are performed. Total professional and other services revenue has historically not been material. Contracts with Multiple Performance Obligations Most of our contracts with customers contain multiple promised services consisting of: (i) our subscription and support services and (ii) professional and other services that are distinct and accounted for separately. The transaction price is allocated to the separate performance obligations on a relative SSP basis. We determine SSP based on our overall pricing objectives, taking into consideration the type of subscription and support services and professional and other services, the geographical region of the customer and the number of users. Variable Consideration Revenue from sales is recorded at the net sales price, which is the transaction price, and includes estimates of variable consideration. The amount of variable consideration that is included in the transaction price is constrained and is included in the net sales price only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue will not occur when the uncertainty is resolved. If our services do not meet certain service level commitments, our customers are entitled to receive service credits, and in certain cases, refunds, each representing a form of variable consideration. We have historically not experienced any significant incidents affecting the defined levels of reliability and performance as required by our subscription contracts. Accordingly, estimated refunds related to these agreements were not material to the periods presented. We provide rebates and other credits within our contracts with certain customers, which are estimated based on the value expected to be earned or claimed on the related sales transaction. Overall, the transaction price is reduced to reflect our estimate of the amount of consideration to which we are entitled based on the terms of the contract. Estimated rebates and other credits were not material during the periods presented. Accounts Receivable and Allowance Accounts receivable are recorded at the invoiced amount and are non-interest bearing. Accounts receivable are stated at their net realizable value, net of an allowance for doubtful accounts. We have a well-established collections history from our customers. Credit is extended to customers based on an evaluation of their financial condition and other factors. In determining the necessary allowance for doubtful accounts, we estimate the lifetime expected credit losses against the existing accounts receivable balance. Our estimate is based on certain factors including historical loss rates, current economic conditions, reasonable and supportable forecasts and customer-specific circumstances. The allowance for doubtful accounts has historically not been material. There were no material write-offs recognized in the periods presented. Accordingly, the movements in the allowance for doubtful accounts were not material for any of the periods presented. We do not have any off-balance-sheet credit exposure related to our customers. Cash Equivalents and Short-Term Investments We classify all highly liquid investments purchased with an original maturity of 90 days or less from the date of purchase as cash equivalents and all highly liquid investments with original maturities beyond 90 days at the time of purchase as short-term investments. Our cash equivalents and short-term investments consist of highly liquid investments in money market funds, U.S. treasury securities, U.S. government agency securities and corporate debt securities. We classify our investments as available-for-sale investments and present them within current assets since these investments represent funds available for current operations and we have the ability and intent, if necessary, to liquidate any of these investments in order to meet our liquidity needs or to grow our business, including for potential business acquisitions or other strategic transactions. Our investments are carried at fair value, with unrealized gains and losses unrelated to credit loss factors reported in accumulated other comprehensive income (loss) ("AOCI"). Our investments are reviewed periodically when there is a decline in a security’s fair value below the amortized cost basis. We consider our intent to sell and whether it is more likely than not that we will be required to sell the securities before the recovery of its cost basis. If either of these criteria are triggered, the amortized cost basis of the debt security is written down to fair value through other income (expense), net. If neither criteria is met, we evaluate whether the decline in fair value below the amortized cost basis is related to credit-related factors or other factors such as interest rate fluctuations. The factors considered in this analysis include the extent the fair value is less than the amortized cost basis, whether there were changes to the rating of the security by a ratings agency, whether the issuer has failed to make scheduled interest payments and other adverse conditions as applicable. Credit-related impairment losses, limited by the amount that the fair value is less than the amortized cost basis, are recorded through an allowance for credit losses in other income (expense), net. For purposes of identifying and measuring credit-related impairments, our policy is to exclude the applicable accrued interest from both the fair value and amortized cost basis of the related debt security. Accrued interest receivable, net of the allowance for credit losses, if any, is recorded to prepaid expenses and other current assets. There were no credit-related impairments recognized on our investments during the periods presented. Interest income, amortization (accretion) of investments purchased at a premium (discount) and realized gains and losses are included in interest income in the consolidated statements of operations. We use the specific identification method to determine the cost in calculating realized gains and losses upon the sale of these investments. Strategic Investments Our strategic investments consist of non-marketable equity investments of privately held companies. Investments in non-marketable equity investments of privately held companies without readily determinable fair values are measured using the measurement alternative, as we have less than 20% ownership and do not have the ability to exercise significant influence over their operations. The carrying amount of non-marketable equity investments is adjusted based on observable price changes from orderly transactions for identical or similar investments of the same issuer and by impairments, when events or circumstances indicate a decline in value has occurred. Non-marketable equity investments that have been remeasured during the period due to an observable event or impairment are classified within Level 3 in the fair value hierarchy because we estimate the value based on valuation methods which may include a combination of the observable transaction price at the transaction date and other unobservable inputs including volatility, rights, and obligations of the investments we hold. Our strategic investments are included within other noncurrent assets in the consolidated balance sheets and adjustments to their carrying amounts are recorded in other income (expense), net in the consolidated statements of operations. There were no material events or circumstances impacting the carrying amount of our strategic investments during the periods presented. Fair Value of Financial Instruments Our financial instruments consist of cash equivalents, short-term investments, accounts receivable, accounts payable, accrued liabilities and convertible senior notes. Cash e quivalents and short-term investments are recorded at fair value. Accounts receivable, accounts payable and accrued liabilities are stated at their carrying value, which approximates fair value due to the short-time to the expected receipt or payment date. Assets recorded at fair value on a recurring basis in the consolidated balance sheets, consisting of cash equivalents and short-term investments, are categorized in accordance with the fair value hierarchy based upon the level of judgment associated with the inputs used to measure their fair values. Convertible senior notes are carried at the initially allocated liability value less unamortized debt discount and issuance costs on the consolidated balance sheets, and the fair value of the convertible senior notes is presented at each reporting period for disclosure purposes only. Property and Equipment Property and equipment, net are stated at historical cost net of accumulated depreciation. Property and equipment, excluding leasehold improvements, are depreciated using the straight-line method over the estimated useful lives of the respective assets, generally ranging from three Capitalized Internal-Use Software Development Costs We capitalize certain costs incurred during the application development stage in connection with software development for our cloud security platform. Costs related to preliminary project activities and post-implementation activities are expensed as incurred. Capitalized costs are recorded as part of property and equipment in the consolidated balance sheets. Maintenance and training costs are expensed as incurred. Capitalized internal-use software is amortized on a straight-line basis over its estimated useful life, which is generally three years, and is recorded as cost of revenue in the consolidated statements of operations. Capitalization of development costs, inclusive of stock-based compensation, of software for internal-use in fiscal 2021, fiscal 2020 and fiscal 2019 was $16.5 million, $13.2 million and $3.7 million, respectively. Amortization expense of capitalized software for internal-use in fiscal 2021, fiscal 2020 and fiscal 2019 was $5.9 million, $1.4 million and $1.0 million, respectively. Business Combinations We account for our business combinations using the acquisition method of accounting, which requires, among other things, allocation of the fair value of purchase consideration to the tangible and intangible assets acquired and liabilities assumed at their estimated fair values on the acquisition date. The excess of the fair value of purchase consideration over the values of these identifiable assets and liabilities is recorded as goodwill. When determining the fair value of assets acquired and liabilities assumed, we make estimates and assumptions, especially with respect to intangible assets. Our estimates of fair value are based upon assumptions believed to be reasonable, but which are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates. During the measurement period, not to exceed one year from the date of acquisition, we may record adjustments to the assets acquired and liabilities assumed, with a corresponding offset to goodwill if new information is obtained related to facts and circumstances that existed as of the acquisition date. After the measurement period, any subsequent adjustments are reflected in the consolidated statements of operations. Acquisition costs, such as legal and consulting fees, are expensed as incurred. Goodwill and Other Long-Lived Assets, including Acquired Intangible Assets Goodwill represents the excess of the fair value of purchase consideration in a business combination over the fair value of net tangible and intangible assets acquired. Goodwill amounts are not amortized, but rather tested for impairment at least annually or more often if circumstances indicate that the carrying value may not be recoverable. No indications of impairment of goodwill were noted during the periods presented. Acquired intangible assets consist of identifiable intangible assets, including developed technology and customer relationships, resulting from business combinations. Acquired finite-lived intangible assets are initially recorded at fair value and are amortized on a straight-line basis over their estimated useful lives. Amortization expense of developed technology and customer relationships is recorded primarily within cost of revenues and sales and marketing expenses, respectively, in the consolidated statements of operations. Long-lived assets, such as property and equipment and acquired intangible assets, are reviewed for impairment whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. We measure the recoverability of these assets by comparing the carrying amounts to the future undiscounted cash flows that these assets are expected to generate. If the total of the future undiscounted cash flows are less than the carrying amount of an asset, we record an impairment charge for the amount by which the carrying amount of the asset exceeds the fair value. In fiscal 2021 and fiscal 2020, we recognized asset impairments of $0.4 million and $0.7 million, respectively, in g eneral and administrative expenses in the consolidated statement of operations related primarily to the abandonment of a leased facility and relocation of our corporate headquarters. Derivative Instruments We enter into foreign currency forward contracts, a portion of which we designate as cash flow hedges, in order to manage the volatility of cash flows that relate to our cost of revenues and operating expenses denominated in foreign currencies. Gains or losses related to our cash flow hedges are recorded as a component of AOCI on the consolidated statements of stockholders' equity until the forecasted transaction occurs in earnings. When the forecasted transaction occurs, the related gains and losses are reclassified into earnings within the financial statement line item associated with the underlying hedged transaction. If the underlying hedged transaction does not occur, or it becomes probable that the hedged transaction will not occur, the cumulative unrealized gain or loss is reclassified immediately from AOCI into earnings within the financial statement line item associated with the underlying hedged transaction. We measure hedge effectiveness using regression analysis at hedge inception and periodically thereafter. We include time value in our effectiveness assessment. We recognize changes in the fair value of non-designated derivative instruments within other income (expense), net in the consolidated statements of operations in the same period that the fair value measurement occurs. All of our derivative instruments are measured at fair value. We have elected to present the derivative assets and derivative liabilities on a gross basis on the consolidated balance sheets. Derivative instruments are classified in the consolidated statements of cash flows as cash from operating activities, which reflect the classification of the underlying hedged transactions. Operating Leases We enter into operating lease arrangements for real estate assets related to office space and co-location assets related to space and racks at data center facilities. We determine if an arrangement contains a lease at its inception by assessing whether there is an identified asset and whether the arrangement conveys the right to control the use of the identified asset in exchange for consideration. Operating leases related balances are included in "operating lease right-of-use assets," "operating lease liabilities," and "operating lease liabilities, noncurrent" in the consolidated balance sheets. Right-of-use assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make payments arising from the lease. Operating lease right-of-use assets and lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. Lease payments consist of the fixed payments under the arrangement. The operating lease liabilities are adjusted for any unpaid lease incentives, such as tenant improvement allowances. Variable costs, such as maintenance and utilities based on actual usage, are not included in the measurement of right-to-use assets and lease liabilities but are expensed when the event determining the amount of variable consideration to be paid occurs. As the implicit rate of our leases is not determinable, we use an incremental borrowing rate ("IBR") based on the information available at the lease commencement date in determining the present value of lease payments. The lease expense is recognized on a straight-line basis over the lease term. We generally use the base, non-cancelable lease term when recognizing the right-of-use assets and lease liabilities, unless it is reasonably certain that a renewal or termination option will be exercised. We account for lease components and non-lease components as a single lease component. Leases with a term of twelve months or less are not recognized on the consolidated balance sheets. We recognize lease expense for these leases on a straight-line basis over the term of the lease. Stock-Based Compensation Compensation expense related to stock-based awards granted to employees and non-employees is calculated based on the fair value of stock-based awards on the date of grant. We recognize stock-based compensation expense over an award’s requisite service period based on the award’s fair value. Stock-based compensation for common stock options is recognized based on the fair value of the awards granted, determined using the Black-Scholes option pricing model. Stock-based compensation expense is recognized on a straight-line basis over the requisite service period, generally four years. Stock-based compensation for purchase rights granted under the employee stock purchase plan is based on the Black-Scholes option pricing model fair value of the number of awards estimated as of the beginning of the offering period. Stock-based compensation expense is recognized following the straight-line attribution method over the offering period. Stock-based compensation for restricted stock units is measured based on the market closing price of our common stock on the grant date. Stock-based compensation expense is recognized on a straight-line basis over the requisite service period, generally four years. Stock-based compensation for performance stock awards (“PSAs”) which have the same grant date and service inception date, is based on the probable number of shares to be attained and the market closing price of our common stock at the grant date. For PSAs where the service inception date of the awards precedes the grant date, stock-based compensation expense is recognized based on the number of PSAs for which it is probable that the performance condition will be met, using the accelerated attribution method and the market closing price of our common stock at each reporting date up to the grant date. The number of these PSAs for which it is probable that the performance condition will be met is determined using management’s best estimate at the end of each reporting period. At the completion of the performance period for these PSAs, any earned PSAs are granted upon approval of the compensation committee of our board of directors. Convertible Senior Notes In accounting for the issuance of the convertible senior notes, we separated the convertible senior notes into liability and equity components. The carrying amounts of the liability component was calculated by measuring the fair value of similar liabilities that do not have associated convertible features. The carrying amount of the equity component representing the conversion option was determined by deducting the fair value of the liability component from the par value of the convertible senior notes as a whole. This difference represents the debt discount that is amortized to interest expense over the respective terms of the convertible senior notes using the effective interest rate method. The equity component was recorded in additional paid-in capital and is not remeasured as long as it continues to meet the conditions for equity classification. In accounting for the related debt issuance costs, we allocated the total amount incurred to the liability and equity components of the convertible senior notes based on their relative values. Issuance costs attributable to the liability component are being amortized to interest expense over the contractual term of the convertible senior notes. The issuance costs attributable to the equity component were netted against the equity component representing the conversion option in additional paid-in capital. To the extent that we receive the convertible senior notes conversion requests prior to their maturity, a portion of the equity component is classified as temporary equity, which is measured as the difference between the principal and net carrying amount of the convertible senior notes requested for conversion. Upon settlement of the conversion requests, the difference between the fair value and the amortized book value of the liability component of the convertible senior notes requested for conversion is recorded as a gain or loss on early note conversion. The fair value of the convertible senior notes is measured based on a similar liability that does not have an associated convertible feature based on the remaining term of the convertible senior notes. Research and Development Our research and development expenses support our efforts to add new features to our existing offerings and to ensure the reliability, availability and scalability of our solutions. Our cloud platform is software-driven, and our research and development teams employ software engineers in the design and the related development, testing, certification and support of our solutions. Accordingly, the majority of our research and development expenses result from employee-related costs, including salaries, bonuses, benefits, stock-based compensation and costs associated with technology tools used by our engineers. Advertising Expenses Advertising expenses are charged to sales and marketing expenses in the consolidated statements of operations as incurred. We recognized advertising expense of $11.8 million, $11.8 million and $8.6 million in fiscal 2021, fiscal 2020 and fiscal 2019, respective |
Revenue Recognition
Revenue Recognition | 12 Months Ended |
Jul. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Revenue Recognition Disaggregation of Revenue Subscription and support revenue is recognized over time and accounted for approximately 97%, 98% and 99% of our revenue in fiscal 2021, fiscal 2020 and fiscal 2019, respectively. The following table summarizes the revenue by region based on the shipping address of customers who have contracted to use our cloud platform: Year Ended July 31, 2021 2020 2019 Amount % Revenue Amount % Revenue Amount % Revenue (in thousands, except for percentage data) United States $ 329,299 49 % $ 210,288 49 % $ 148,807 49 % Europe, Middle East and Africa (*) 253,138 38 174,497 40 124,437 41 Asia Pacific 76,105 11 38,793 9 23,838 8 Other 14,558 2 7,691 2 5,754 2 Total $ 673,100 100 % $ 431,269 100 % $ 302,836 100 % _____ (*) Revenue from the United Kingdom represented 10% of the total revenue in the periods presented. The following table summarizes the revenue from contracts by type of customer: Year Ended July 31, 2021 2020 2019 Amount % Revenue Amount % Revenue Amount % Revenue (in thousands, except for percentage data) Channel partners $ 632,416 94 % $ 414,908 96 % $ 289,579 96 % Direct customers 40,684 6 16,361 4 13,257 4 Total $ 673,100 100 % $ 431,269 100 % $ 302,836 100 % Significant Customers No single customer accounted for 10% or more of the total revenue in the periods presented. The following table summarizes the concentration of 10% or more of the total balance of accounts receivable, net: July 31, 2021 2020 Channel partner A * 11 % * Represents less than 10%. Contract Balances Contract liabilities consist of deferred revenue and include payments received in advance of performance under the contract. Such amounts are recognized as revenue over the contractual period. Deferred revenue, including current and noncurrent balances as of July 31, 2021 and July 31, 2020 was $630.6 million and $369.8 million, respectively. In fiscal 2021, fiscal 2020 and fiscal 2019 we recognized revenue of $335.5 million, $220.9 million and $143.9 million, respectively, that was included in the corresponding contract liability balance at the beginning of the related fiscal year. We receive payments from customers based upon contractual billing schedules and accounts receivable are recorded when the right to consideration becomes unconditional. Payment terms on invoiced amounts are typically 30 days but may be up to 90 days for some of our channel partners. Contract assets include amounts related to our contractual right to consideration for both completed and partially completed performance obligations that may not have been invoiced and such amounts have historically not been material. Remaining Performance Obligations The typical subscription and support term is one Costs to Obtain and Fulfill a Contract We capitalize sales commission and associated payroll taxes paid to internal sales personnel that are incremental to the acquisition of channel partner and direct customer contracts. These costs are recorded as deferred contract acquisition costs in the consolidated balance sheets. We determine whether costs should be deferred based on our sales compensation plans, if the commissions are in fact incremental and would not have occurred absent the customer contract. Sales commissions for renewal of a contract are not considered commensurate with the commissions paid for the acquisition of the initial contract given the substantive difference in commission rates in proportion to their respective contract values. Commissions paid upon the initial acquisition of a contract are amortized over an estimated period of benefit of five years while commissions paid for renewal contracts are amortized over the contractual term of the renewals. Amortization of deferred contract acquisition costs is recognized on a straight-line basis commensurate with the pattern of revenue recognition and included in sales and marketing expense in the consolidated statements of operations. We determine the period of benefit for commissions paid for the acquisition of the initial contract by taking into consideration the expected subscription term and expected renewals of our customer contracts, the duration of our relationships with our customers, customer retention data, our technology development lifecycle and other factors. We periodically review the carrying amount of deferred contract acquisition costs to determine whether events or changes in circumstances have occurred that could impact the period of benefit of these deferred costs. We did not recognize any impairment losses of deferred contract acquisition costs during the periods presented. The activity of the deferred contract acquisition costs consisted of the following: Year Ended July 31, 2021 2020 2019 (in thousands) Beginning balance $ 109,915 $ 69,785 $ 55,910 Capitalization of contract acquisition costs 137,673 65,052 32,526 Amortization of deferred contract acquisition costs (40,558) (24,922) (18,651) Ending balance $ 207,030 $ 109,915 $ 69,785 The outstanding balance of the deferred contract acquisition costs consisted of the following: July 31, 2021 2020 (in thousands) Deferred contract acquisition costs $ 57,373 $ 32,240 Deferred contract acquisition costs, noncurrent 149,657 77,675 Total deferred contract acquisition costs $ 207,030 $ 109,915 Sales commissions accrued but not paid as of July 31, 2021 and 2020, totaled $46.7 million and $21.0 million, respectively, which are included within accrued compensation in the consolidated balance sheets. |
Cash Equivalents and Short-Term
Cash Equivalents and Short-Term Investments | 12 Months Ended |
Jul. 31, 2021 | |
Cash and Cash Equivalents [Abstract] | |
Cash Equivalents and Short-Term Investments | Cash Equivalents and Short-Term Investments Cash equivalents and short-term investments consisted of the following as of July 31, 2021: Amortized Unrealized Unrealized Fair Value (in thousands) Cash equivalents: Money market funds $ 167,337 $ — $ — $ 167,337 U.S. government agency securities 10,999 — — 10,999 Total cash equivalents $ 178,336 $ — $ — $ 178,336 Short-term investments: U.S. treasury securities $ 387,428 $ 9 $ (17) $ 387,420 U.S. government agency securities 511,622 144 (34) 511,732 Corporate debt securities 327,512 102 (112) 327,502 Total short-term investments $ 1,226,562 $ 255 $ (163) $ 1,226,654 Total cash equivalents and short-term investments $ 1,404,898 $ 255 $ (163) $ 1,404,990 Cash equivalents and short-term investments consisted of the following as of July 31, 2020: Amortized Unrealized Unrealized Fair Value (in thousands) Cash equivalents: Money market funds $ 51,690 $ — $ — $ 51,690 U.S. treasury securities 39,997 — (1) 39,996 U.S. government agency securities 14,997 — — 14,997 Total cash equivalents $ 106,684 $ — $ (1) $ 106,683 Short-term investments: U.S. treasury securities $ 415,539 $ 152 $ (127) $ 415,564 U.S. government agency securities 595,725 186 (114) 595,797 Corporate debt securities 216,879 569 (87) 217,361 Total short-term investments $ 1,228,143 $ 907 $ (328) $ 1,228,722 Total cash equivalents and short-term investments $ 1,334,827 $ 907 $ (329) $ 1,335,405 The amortized cost and fair value of our short-term investments based on their stated maturities consisted of the following as of July 31, 2021: Amortized Fair Value (in thousands) Due within one year $800,659 $800,793 Due between one to three years 425,903 425,861 Total $1,226,562 $1,226,654 Short-term investments that were in an unrealized loss position as of July 31, 2021 consisted of the following: Less than 12 Months Greater than 12 Months Total Fair Unrealized Fair Unrealized Fair Unrealized (in thousands) U.S. treasury securities $ 306,908 $ (17) $ — $ — $ 306,908 $ (17) U.S. government agency securities 104,782 (34) — — 104,782 (34) Corporate debt securities 157,208 (112) — — 157,208 (112) Total $ 568,898 $ (163) $ — $ — $ 568,898 $ (163) Short-term investments that were in an unrealized loss position as of July 31, 2020 consisted of the following: Less than 12 Months Greater than 12 Months Total Fair Unrealized Fair Unrealized Fair Unrealized (in thousands) U.S. treasury securities $ 347,959 $ (127) $ — $ — $ 347,959 $ (127) U.S. government agency securities 340,503 (113) 5,502 (1) 346,005 (114) Corporate debt securities 105,953 (87) — — 105,953 (87) Total $ 794,415 $ (327) $ 5,502 $ (1) $ 799,917 $ (328) We review the individual securities that have unrealized losses in our short-term investment portfolio on a regular basis. We evaluate, among others, whether we have the intention to sell any of these investments and whether it is not more likely than not that we will be required to sell any of them before recovery of the amortized cost basis. Neither of these criteria were met in any period presented. We additionally evaluate whether the decline in fair value of the corporate debt securities below its amortized cost basis is related to credit losses or other factors. Based on this evaluation, we determined that unrealized losses of the above securities were primarily attributable to changes in interest rates and non credit-related factors. Accordingly, we determined that an allowance for credit losses was unnecessary for our short-term investments as of July 31, 2021 and 2020. We recorded $3.9 million and $3.8 million of accrued interest receivable within prepaid expenses and other current assets in the consolidated balance sheets as of July 31, 2021 and 2020, respectively. Strategic Investments During fiscal 2021, we invested an additional $3.1 million in non-marketable equity securities of privately held companies which do not have a readily determinable fair value. These investments are primarily accounted for under the cost method as we have less than 20% ownership and do not have the ability to exercise significant influence over their operations. The carrying amount of our strategic investments was $5.1 million and $2.0 million as of July 31, 2021 and 2020, respectively, which are included within other noncurrent assets in the consolidated balance sheets. There were no material events or circumstances impacting the carrying amount of our strategic investments during the periods presented. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Jul. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Fair value is defined as the exchange price that would be received from sale of an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. We measure our financial assets and liabilities at fair value at each reporting period using a fair value hierarchy which requires us to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument’s classification within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Three levels of inputs may be used to measure fair value: • Level I - Observable inputs are unadjusted quoted prices in active markets for identical assets or liabilities; • Level II - Observable inputs are quoted prices for similar assets and liabilities in active markets or inputs other than quoted prices that are observable for the assets or liabilities, either directly or indirectly through market corroboration, for substantially the full term of the financial instruments; and • Level III - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. These inputs are based on our own assumptions used to measure assets and liabilities at fair value and require significant management judgment or estimation. Our money market funds are classified within Level I due to the highly liquid nature of these assets and have quoted prices in active markets. Certain of our investments in available-for-sale securities (i.e., U.S. treasury securities, U.S. government agency securities and corporate debt securities), as well as our assets and liabilities arising from our foreign currency forward contracts, are classified within Level II. The fair value of our Level II financial assets and liabilities is determined by using inputs based on non-binding market consensus prices that are primarily corroborated by observable market data or quoted market prices for similar instruments, for substantially the full term of the financial assets and liabilities. Assets and liabilities that are measured at fair value on a recurring basis consisted of the following as of July 31, 2021: Level I Level II Level III Fair Value Quoted Prices Significant Significant (in thousands) Cash equivalents: Money market funds $ 167,337 $ 167,337 $ — $ — U.S. treasury securities 10,999 — 10,999 — Total cash equivalents $ 178,336 $ 167,337 $ 10,999 $ — Short-term investments: U.S. treasury securities $ 387,420 $ — $ 387,420 $ — U.S. government agency securities 511,732 — 511,732 — Corporate debt securities 327,502 — 327,502 — Total short-term investments $ 1,226,654 $ — $ 1,226,654 $ — Total cash equivalents and short-term investments $ 1,404,990 $ 167,337 $ 1,237,653 $ — Designated derivative instruments: Foreign currency contracts assets-current (1) $ 459 $ — $ 459 $ — Foreign currency contracts assets-noncurrent (2) $ 26 $ — $ 26 $ — Foreign currency contracts liabilities-current (3) $ 1,083 $ — $ 1,083 $ — Foreign currency contracts liabilities-noncurrent (4) $ 42 $ — $ 42 $ — Non-designated derivative instruments: Foreign currency contracts assets-current (1) $ 83 $ — $ 83 $ — Foreign currency contracts liabilities-current (3) $ 240 $ — $ 240 $ — (1) Reported as prepaid expenses and other current assets in the consolidated balance sheets. (2) Reported as other noncurrent assets in the consolidated balance sheets. (3) Reported as accrued expenses and other current liabilities in the consolidated balance sheets. (4) Reported as other noncurrent liabilities in the consolidated balance sheets. Assets that are measured at fair value on a recurring basis consisted of the following as of July 31, 2020: Level I Level II Level III Fair Value Quoted Prices Significant Significant (in thousands) Cash equivalents: Money market funds $ 51,690 $ 51,690 $ — $ — U.S. treasury securities 39,996 — 39,996 — U.S. government agency securities 14,997 — 14,997 — Total cash equivalents $ 106,683 $ 51,690 $ 54,993 $ — Short-term investments: U.S. treasury securities $ 415,564 $ — $ 415,564 $ — U.S. government agency securities 595,797 — 595,797 — Corporate debt securities 217,361 — 217,361 — Total short-term investments $ 1,228,722 $ — $ 1,228,722 $ — Total cash equivalents and short-term investments $ 1,335,405 $ 51,690 $ 1,283,715 $ — We did not have transfers between levels of the fair value hierarchy of assets measured at fair value during the periods presented. Additionally, we did not have derivatives in fiscal 2020. Refer to Note 9, Convertible Senior Notes, for the carrying amount and estimated fair value of our convertible senior notes as of July 31, 2021 and 2020. |
Property and Equipment and Purc
Property and Equipment and Purchased Intangible Assets | 12 Months Ended |
Jul. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment and Purchased Intangible Assets | Property and Equipment and Purchased Intangible Assets Property and equipment consisted of the following: July 31, Estimated Useful Life 2021 2020 (in thousands) Hosting equipment 3-4 years $ 130,981 $ 87,418 Computers and equipment 3-5 years 5,599 3,875 Purchased software 3 years 1,311 1,311 Capitalized internal-use software 3 years 39,542 23,081 Furniture and fixtures 5 years 1,021 1,965 Leasehold improvements Shorter of useful life or lease term 7,339 8,712 Total property and equipment, gross 185,793 126,362 Less: Accumulated depreciation and amortization (77,217) (50,628) Total property and equipment, net $ 108,576 $ 75,734 Purchased intangible assets consist of internet protocol (IP) addresses, which are amortized on a straight-line basis over an estimated useful life of 10 years. As of July 31, 2021, the historical cost and accumulated amortization was $3.0 million and $0.4 million, respectively. As of July 31, 2020, the historical cost and accumulated amortization was $2.5 million and $0.1 million, respectively. Purchased intangible assets are included within other noncurrent assets in the consolidated balance sheets. We recognized depreciation and amortization expense on property and equipment and purchased intangible assets of $29.7 million, $17.7 million and $10.4 million in fiscal 2021, fiscal 2020 and fiscal 2019, respectively. |
Property and Equipment and Purchased Intangible Assets | Property and Equipment and Purchased Intangible Assets Property and equipment consisted of the following: July 31, Estimated Useful Life 2021 2020 (in thousands) Hosting equipment 3-4 years $ 130,981 $ 87,418 Computers and equipment 3-5 years 5,599 3,875 Purchased software 3 years 1,311 1,311 Capitalized internal-use software 3 years 39,542 23,081 Furniture and fixtures 5 years 1,021 1,965 Leasehold improvements Shorter of useful life or lease term 7,339 8,712 Total property and equipment, gross 185,793 126,362 Less: Accumulated depreciation and amortization (77,217) (50,628) Total property and equipment, net $ 108,576 $ 75,734 Purchased intangible assets consist of internet protocol (IP) addresses, which are amortized on a straight-line basis over an estimated useful life of 10 years. As of July 31, 2021, the historical cost and accumulated amortization was $3.0 million and $0.4 million, respectively. As of July 31, 2020, the historical cost and accumulated amortization was $2.5 million and $0.1 million, respectively. Purchased intangible assets are included within other noncurrent assets in the consolidated balance sheets. We recognized depreciation and amortization expense on property and equipment and purchased intangible assets of $29.7 million, $17.7 million and $10.4 million in fiscal 2021, fiscal 2020 and fiscal 2019, respectively. Goodwill The changes in the carrying amount of goodwill consisted of the following: Amount (in thousands) Balance as of July 31, 2020 $ 30,059 Goodwill acquired 28,918 Balance as of July 31, 2021 $ 58,977 Acquired Intangible Assets Acquired intangible assets consist of developed technology and customer relationships acquired through our business combinations and asset acquisitions. Acquired intangible assets are amortized using the straight-line method over their useful lives. Acquired intangible assets subject to amortization consisted of the following as of July 31, 2021 and 2020: Gross Carrying Amount Accumulated Amortization Net Carrying Amount Weighted Average Remaining Useful life July 31, 2020 Additions July 31, 2021 July 31, 2020 Amortization Expense July 31, 2021 July 31, 2020 July 31, 2021 July 31, 2021 (in thousands) (years) Developed technology $ 26,856 $ 12,800 $ 39,656 $ (4,206) $ (6,468) $ (10,674) $ 22,650 $ 28,982 4.0 Customer relationships 1,460 2,100 3,560 (86) (327) (413) 1,374 3,147 4.5 Total $ 28,316 $ 14,900 $ 43,216 $ (4,292) $ (6,795) $ (11,087) $ 24,024 $ 32,129 4.0 As of July 31, 2020, the weighted-average useful life for developed technology and customer relationships was 4.2 years and 4.7 years, respectively. During fiscal 2021, in connection with the acquisitions of Smokescreen and Trustdome, we acquired developed technology and customer relationships with a fair value of $12.8 million and $2.1 million, respectively, and each of them with an estimated useful life of 5.0 years. For further information refer to Note 6, Business Combinations. Amortization expense of acquired intangible assets was $6.8 million, $3.4 million and $0.9 million in fiscal 2021, fiscal 2020 and fiscal 2019, respectively. Amortization expense of developed technology and customer relationships is recorded primarily within cost of revenue and sales and marketing expenses, respectively, in the consolidated statements of operations. Future amortization expense of acquired intangible assets consisted of the following as of July 31, 2021: Amortization Expense (in thousands) Year ending July 31, 2022 $ 8,678 2023 8,181 2024 6,741 2025 6,038 2026 2,491 Total $ 32,129 |
Business Combinations
Business Combinations | 12 Months Ended |
Jul. 31, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
Business Combinations | Business Combinations Smokescreen Technologies Private Limited On June 1, 2021, we completed the acquisition of Smokescreen Technologies Private Limited (“Smokescreen”), a technology company incorporated in India. Smokescreen is a leader in active defense and deception technology. Smokescreen's cutting-edge capabilities will be integrated into the Zscaler Zero Trust Exchange platform, further building upon our ability to detect sophisticated, highly targeted attacks, ransomware and lateral movement attempts. Pursuant to the terms of the stock purchase agreement, the aggregate purchase price was approximately $11.7 million in cash. In connection with this acquisition, we completed a valuation of the acquired intangible assets as of June 1, 2021, in order to allocate the purchase price consideration. The purchase price allocation resulted in the recognition of $5.7 million of goodwill, $5.6 million of developed technology and $2.1 million of customer relationships. The developed technology was valued using a replacement cost approach, which is based on the cost of a market participant to reconstruct a substitute asset of comparable utility. The customer relationships were also valued using the replacement cost approach, which is based on the cost a market participant would incur to generate the acquired portfolio of customers. Goodwill represents the excess of the purchase price paid over the fair value of the net assets acquired and is primarily attributable to the acquired workforce and expected operating synergies. Both goodwill and acquired intangible assets will be fully deductible for income tax purposes. We incurred approximately $0.5 million of acquisition related costs, which were recorded as general and administrative expenses in fiscal 2021. The acquisition qualified as a stock transaction for tax purposes. As a result, we recognized a deferred tax liability of approximately $1.6 million, generated primarily from the difference between the tax basis and fair value of the acquired developed technology, which increased goodwill by the same amount. The allocation of the purchase price consideration consisted of the following: Amount Estimated Useful Life (in thousands) Assets acquired: Cash and other assets $ 1,347 Acquired intangible assets: Developed technology 5,600 5 years Customer relationships 2,100 5 years Goodwill 5,686 Total $ 14,733 Less liabilities assumed: Other liabilities $ 1,516 Deferred tax liability 1,558 Total $ 3,074 Total purchase price consideration $ 11,659 Trustdome Limited On April 15, 2021, we completed the acquisition of Trustdome Limited (“Trustdome”), a technology company incorporated in Israel. Trustdome is a leading innovator in Cloud Infrastructure Entitlement Management, which we plan to integrate with our existing Cloud Security Posture Management offering and provide a comprehensive solution for reducing public cloud attack surfaces and improving security posture. With this acquisition, we also have expanded our global footprint with our first development center in Israel. Pursuant to the terms of the purchase agreement, the aggregate purchase price was approximately $31.1 million in cash. Additionally, certain of Trustdome's employees who became our employees are entitled to receive deferred merger consideration payable in the form of shares of our authorized common stock and restricted stock units. These awards are subject to time-based vesting and will be recognized as stock-based compensation expense during the post-combination period. In connection with this acquisition, we completed a valuation of the acquired intangible assets as of April 15, 2021, in order to allocate the purchase price consideration. The purchase price allocation resulted in the recognition of $23.2 million of goodwill and $7.2 million of developed technology. The developed technology was valued using a replacement cost approach, which is based on the cost of a market participant to reconstruct a substitute asset of comparable utility. Goodwill represents the excess of the purchase price paid over the fair value of the net assets acquired and is primarily attributable to the acquired workforce and expected operating synergies. Both goodwill and acquired developed technology will be fully deductible for income tax purposes. We incurred approximately $0.4 million of acquisition related costs, which were recorded as general and administrative expenses in fiscal 2021. The acquisition qualified as a stock transaction for tax purposes. As a result, we recognized a deferred tax liability for approximately $0.6 million, generated primarily from the difference between the tax basis and fair value of the acquired developed technology, which increased goodwill by the same amount. The allocation of the purchase price consideration consisted of the following: Amount Estimated Useful Life (in thousands) Assets acquired: Cash and other assets $ 1,611 Acquired intangible assets: Developed technology 7,200 5 years Goodwill 23,232 Total $ 32,043 Less Liabilities assumed: Other liabilities $ 277 Deferred tax liability 624 Total $ 901 Total purchase price consideration $ 31,142 Edgewise Networks Inc. On May 22, 2020, we completed the acquisition of Edgewise Networks Inc. ("Edgewise"), a technology company incorporated in the United States. Edgewise is a pioneer in securing application-to-application communications in public clouds and data centers. Edgewise customers measurably reduce the attack surface to lower the risk of application compromise and data breaches by simplifying the security of east-west communications through identity-based segmentation. With this acquisition, we secure workloads and application-to-application communications for our customers. Pursuant to the terms of the purchase agreement, the aggregate purchase price consideration was approximately $30.7 million in cash. Additionally, certain of Edgewise's employees who became our employees are entitled to receive additional consideration in the form of restricted stock units. These awards are subject to time-based vesting and will be recognized as stock-based compensation expense during the post-combination period. In connection with this acquisition, we completed a valuation of the acquired intangible assets as of May 22, 2020, in order to allocate the purchase price consideration. The purchase price allocation resulted in the recognition of $16.7 million of goodwill, $13.9 million of developed technology and $1.3 million of customer relationships. The developed technology was valued using a replacement cost approach, which is based on the cost of a market participant to reconstruct a substitute asset of comparable utility. The customer relationships were also valued using the replacement cost approach, which is based on the cost a market participant would incur to generate the acquired portfolio of customers. Goodwill represents the excess of the purchase price paid over the fair value of the net assets acquired and is primarily attributable to the acquired workforce and expected operating synergies. Goodwill is not expected to be deductible for income tax purposes. We incurred approximately $0.6 million of acquisition related costs, which were recorded as general and administrative expenses in fiscal 2020. The acquisition qualified as a stock transaction for tax purposes. As a result, we recognized a deferred tax liability for approximately $0.6 million, generated primarily from the difference between the tax basis and fair value of the acquired developed technology and customer relationships, which increased goodwill by the same amount. As we had a full valuation allowance as of July 31, 2020, we recorded an income tax benefit as a result of the reduction of the valuation allowance due to establishment of the deferred tax liability in the consolidated statement of operations in fiscal 2020. Refer to Note 14, Income Taxes, for further information. The allocation of the purchase price consideration consisted of the following: Amount Estimated Useful Life (in thousands) Assets acquired: Cash and other assets $ 294 Operating lease right-of-use asset 630 Acquired intangible assets: Developed technology 13,900 5 years Customer relationships 1,300 5 years Goodwill 16,709 Total $ 32,833 Less liabilities assumed: Accounts payable and accrued liabilities $ 333 Deferred revenue 540 Operating lease liability 630 Deferred tax liability 620 Total $ 2,123 Total purchase price consideration $ 30,710 Cloudneeti Corporation On April 16, 2020, we completed the acquisition of Cloudneeti Corporation ("Cloudneeti"), a technology company incorporated in the United States. Cloudneeti is a cloud security posture management company, which prevents and remediates application misconfigurations in cloud service models, including SaaS; infrastructure as a service, or IaaS; and platform as a service, or PaaS. With this acquisition, we further provide our industry-leading data protection coverage for our customers. Pursuant to the terms of the purchase agreement, the aggregate purchase price consideration was approximately $8.9 million in cash. Additionally, certain of Cloudneeti's employees who became our employees are entitled to receive additional consideration payable in the form of restricted stock units. These awards are subject to performance and time-based vesting and will be recognized as stock-based compensation expense during the post-combination period. In connection with this acquisition, we completed a valuation of the acquired intangible assets as of April 16, 2020, in order to allocate the purchase price consideration. The purchase price allocation resulted in the recognition of $5.9 million of goodwill and $3.5 million of developed technology. The developed technology was valued using a replacement cost approach, which is based on the cost of a market participant to reconstruct a substitute asset of comparable utility. Goodwill represents the excess of the purchase price paid over the fair value of the net assets acquired and is primarily attributable to the acquired workforce and expected operating synergies. Goodwill is not expected to be deductible for income tax purposes. We incurred approximately $0.5 million of acquisition related costs, which were recorded as general and administrative expenses in fiscal 2020. The acquisition qualified as a stock transaction for tax purposes. As a result, we recognized a deferred tax liability for approximately $0.5 million, generated primarily from the difference between the tax basis and fair value of the acquired developed technology, which increased goodwill by the same amount. As we have a full valuation allowance as of July 31, 2020, we recorded an income tax benefit as a result of the reduction of the valuation allowance due to establishment of the deferred tax liability in the consolidated statement of operations in fiscal 2020. Refer to Note 14, Income Taxes, for further information. The allocation of the purchase price consideration consisted of the following: Amount Estimated Useful Life (in thousands) Assets acquired: Cash and other assets $ 66 Acquired intangible assets: Developed technology 3,500 5 years Goodwill 5,871 Total $ 9,437 Less liabilities assumed: Deferred tax liability $ 490 Other liabilities 12 Total $ 502 Total purchase price consideration $ 8,935 Appsulate, Inc . On May 29, 2019, we completed the acquisition Appsulate, Inc. ("Appsulate"), an early stage technology company incorporated in the United States. Pursuant to the terms of the purchase agreement, the aggregate purchase price was approximately $12.9 million in cash. In connection with this acquisition, we completed a valuation of the acquired intangible assets as of May 29, 2019, in order to allocate the purchase price consideration. The purchase price allocation resulted in the recognition of $7.3 million of goodwill and $7.0 million of developed technology. The developed technology was valued using a replacement cost approach, which is based on the cost a market participant to reconstruct a substitute asset of comparable utility. Goodwill represents the excess of the purchase price paid over the fair value of the net assets acquired and is primarily attributable to the acquired workforce and expected operating synergies. Goodwill is not expected to be deductible for income tax purposes. We incurred approximately $0.3 million of acquisition related costs, which were recorded as general and administrative expenses in fiscal 2019. The acquisition qualified as a stock transaction for tax purposes. As a result, we recognized a deferred tax liability for approximately $1.4 million, generated primarily from the difference between the tax basis and fair value of the acquired developed technology, which increased goodwill by the same amount. As we have a full valuation allowance as of July 31, 2019, we recorded an income tax benefit as a result of the reduction of the valuation allowance due to establishment of the deferred tax liability in the consolidated statement of operations in fiscal 2019. Refer to Note 14, Income Taxes, for further information. The allocation of the purchase price consideration, consisted of the following: Amount Estimated Useful Life (in thousands) Assets acquired: Cash and cash equivalents $ 13 Acquired intangible assets: Developed technology 7,000 4 years Goodwill 7,281 Total $ 14,294 Less liabilities assumed: Deferred tax liability $ 1,422 Total purchase price consideration $ 12,872 Other acquisitions In fiscal 2019, we also completed the acquisition of a technology company for a purchase price approximately $1.1 million in cash. The goodwill and acquired intangible assets recorded for this acquisition were not material to the consolidated financial statements. Pro forma Financial Information The pro forma financial information from the above business acquisitions, assuming the acquisition had occurred as of the beginning of the fiscal year prior to the fiscal year of the acquisition, as well as revenue and earnings generated during the current fiscal year, were not material for disclosure purposes. |
Derivative Instruments
Derivative Instruments | 12 Months Ended |
Jul. 31, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments | Derivative Instruments We implemented a foreign currency risk management program during the fiscal 2021. As a global business, we are exposed to foreign currency exchange rate risk. Substantially all of our revenue is transacted in U.S. dollars; however, a portion of our cost of revenues and operating expenditures are incurred outside of the United States and are denominated in foreign currencies, making them subject to fluctuations in foreign currency exchange rates. In order to mitigate the impact of foreign currency fluctuations on our future cash flows and earnings, we enter into foreign currency forward contracts, which we designate as cash flow hedges. All cash flow hedges were considered effective during fiscal 2021. As of July 31, 2021, the total notional amount of our outstanding foreign currency forward contracts was $118.9 million for designated and $28.2 million for non-designated foreign currency forward contracts. The maximum length of time over which forecasted foreign currency denominated operating expenses are hedged is 18 months. Substantially all of the unrealized gains and losses related to our cash flow hedges are expected to be released into earnings over the next 12 months. Refer to Note 4, Fair Value Measurements, for the fair value of our derivative instruments as reported on the consolidated balance sheet as of July 31, 2021. During the fiscal 2021, the unrealized gains and losses related to our cash flow hedges that were recognized in AOCI and the gains and losses reclassified into the consolidated statement of operations were not material. During fiscal 2021, changes in the fair value of our non-designated derivative instruments recorded in other income, net within the consolidated statement of operations were not material. |
Goodwill and Acquired Intangibl
Goodwill and Acquired Intangible Assets | 12 Months Ended |
Jul. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Acquired Intangible Assets | Property and Equipment and Purchased Intangible Assets Property and equipment consisted of the following: July 31, Estimated Useful Life 2021 2020 (in thousands) Hosting equipment 3-4 years $ 130,981 $ 87,418 Computers and equipment 3-5 years 5,599 3,875 Purchased software 3 years 1,311 1,311 Capitalized internal-use software 3 years 39,542 23,081 Furniture and fixtures 5 years 1,021 1,965 Leasehold improvements Shorter of useful life or lease term 7,339 8,712 Total property and equipment, gross 185,793 126,362 Less: Accumulated depreciation and amortization (77,217) (50,628) Total property and equipment, net $ 108,576 $ 75,734 Purchased intangible assets consist of internet protocol (IP) addresses, which are amortized on a straight-line basis over an estimated useful life of 10 years. As of July 31, 2021, the historical cost and accumulated amortization was $3.0 million and $0.4 million, respectively. As of July 31, 2020, the historical cost and accumulated amortization was $2.5 million and $0.1 million, respectively. Purchased intangible assets are included within other noncurrent assets in the consolidated balance sheets. We recognized depreciation and amortization expense on property and equipment and purchased intangible assets of $29.7 million, $17.7 million and $10.4 million in fiscal 2021, fiscal 2020 and fiscal 2019, respectively. Goodwill The changes in the carrying amount of goodwill consisted of the following: Amount (in thousands) Balance as of July 31, 2020 $ 30,059 Goodwill acquired 28,918 Balance as of July 31, 2021 $ 58,977 Acquired Intangible Assets Acquired intangible assets consist of developed technology and customer relationships acquired through our business combinations and asset acquisitions. Acquired intangible assets are amortized using the straight-line method over their useful lives. Acquired intangible assets subject to amortization consisted of the following as of July 31, 2021 and 2020: Gross Carrying Amount Accumulated Amortization Net Carrying Amount Weighted Average Remaining Useful life July 31, 2020 Additions July 31, 2021 July 31, 2020 Amortization Expense July 31, 2021 July 31, 2020 July 31, 2021 July 31, 2021 (in thousands) (years) Developed technology $ 26,856 $ 12,800 $ 39,656 $ (4,206) $ (6,468) $ (10,674) $ 22,650 $ 28,982 4.0 Customer relationships 1,460 2,100 3,560 (86) (327) (413) 1,374 3,147 4.5 Total $ 28,316 $ 14,900 $ 43,216 $ (4,292) $ (6,795) $ (11,087) $ 24,024 $ 32,129 4.0 As of July 31, 2020, the weighted-average useful life for developed technology and customer relationships was 4.2 years and 4.7 years, respectively. During fiscal 2021, in connection with the acquisitions of Smokescreen and Trustdome, we acquired developed technology and customer relationships with a fair value of $12.8 million and $2.1 million, respectively, and each of them with an estimated useful life of 5.0 years. For further information refer to Note 6, Business Combinations. Amortization expense of acquired intangible assets was $6.8 million, $3.4 million and $0.9 million in fiscal 2021, fiscal 2020 and fiscal 2019, respectively. Amortization expense of developed technology and customer relationships is recorded primarily within cost of revenue and sales and marketing expenses, respectively, in the consolidated statements of operations. Future amortization expense of acquired intangible assets consisted of the following as of July 31, 2021: Amortization Expense (in thousands) Year ending July 31, 2022 $ 8,678 2023 8,181 2024 6,741 2025 6,038 2026 2,491 Total $ 32,129 |
Convertible Senior Notes
Convertible Senior Notes | 12 Months Ended |
Jul. 31, 2021 | |
Debt Disclosure [Abstract] | |
Convertible Senior Notes | Convertible Senior Notes On June 25, 2020, we issued $1,150.0 million in aggregate principal amount of 0.125% Convertible Senior Notes due 2025 (the “Notes”), including the exercise in full by the initial purchasers of the Notes of their option to purchase an additional $150.0 million principal amount of the Notes. The Notes bear interest at a rate of 0.125% per year and interest is payable semiannually in arrears on January 1 and July 1 of each year, beginning on January 1, 2021. The Notes mature on July 1, 2025, unless earlier converted, redeemed or repurchased. The total net proceeds from the offering, after deducting initial purchase discounts and other debt issuance costs, was $1,130.5 million . The Notes ar e unsecured obligations and do not contain any financial covenants or restrictions on the payments of dividends, the incurrence of indebtedness or the issuance or repurchase of securities by us or any of our subsidiaries. The following table presents details of the Notes: Initial Conversion Rate per $1,000 Principal Initial Conversion Price Initial Number of Shares (in thousands) Notes 6.6315 shares $150.80 7,626 The Notes are convertible at the option of the holders at any time prior to the close of business on the business day immediately preceding April 1, 2025, only under the following circumstances: • During any fiscal quarter commencing after the fiscal quarter ending on October 31, 2020 (and only during such fiscal quarter), if the last reported sale price of our common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on and including, the last trading day of the immediately preceding fiscal quarter is greater than or equal to 130% of the conversion price of the Notes on each applicable trading day; • During the five-business day period after any five consecutive trading day period (the “measurement period”) in which the trading price per $1,000 principal amount of the Notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of our common stock and the conversion rate of the Notes on each such trading day; • If we call any or all of the Notes for redemption, the Notes called for redemption (or, at our election all Notes) may be submitted for conversion at any time prior to the close of business on the second scheduled trading day immediately preceding the redemption date; or • upon the occurrence of specified corporate events as set forth within the indenture governing the Notes. On or after April 1, 2025, until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert, all or any portion of their Notes at any time, in multiples of $1,000 principal amount, at their option regardless of the foregoing circumstances. Upon conversion, we will satisfy the conversion obligation by paying or delivering, as the case may be, cash, shares of our common stock or a combination of cash and shares of our common stock, at our election. It is our current intent to settle the principal amount of the Notes in cash. During the three months ended July 31, 2021, the conditional conversion feature of the Notes was triggered as the last reported sale price of our common stock was greater than or equal to 130% of the conversion price of the Notes for at least 20 trading days during the period of 30 consecutive trading days ending on July 30, 2021 (the last trading day of the fiscal quarter). Accordingly, the Notes are currently convertible, in whole or in part, at the option of the holders from August 1, 2021 through October 31, 2021. Whether the Notes will be convertible following such period will depend on the continued satisfaction of this condition or another conversion condition in the future. During fiscal 2021 and fiscal 2020, none of the Notes have been converted. Since we have the election of repaying the Notes in cash, shares of our common stock, or a combination of both, we continued to classify the Notes as a noncurrent liability in the consolidated balance sheet as of July 31, 2021. We may not redeem the Notes prior to July 5, 2023. On or after July 5, 2023, and prior to the 21st scheduled trading day immediately preceding the maturity date, we may redeem for cash all or any portion of the Notes, at our option, if the last reported sale price of our common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which we provide notice of redemption at a redemption price equal to 100% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. No sinking fund is provided for the Notes. If we redeem less than all the outstanding Notes, and only Notes called for redemption may be converted in connection with such partial redemption, at least $100.0 million aggregate principal amount of Notes must be outstanding and not subject to such partial redemption as of the relevant redemption notice date. In the event of a corporate event that constitutes a “fundamental change (as defined in the indenture governing the Notes),” holders of the Notes will have the right, at their option to require us to repurchase for cash all or any portion of the Notes upon the occurrence of a fundamental change, at a purchase price equal to 100% of the principal amount of the Notes plus any accrued and unpaid interest, up to but excluding, the date of such repurchase. In addition, following certain corporate events that occur prior to the maturity date, or if we issue a notice of redemption, we will, in certain circumstances, increase the conversion rate for a holder who elects to convert its Notes in connection with such corporate event or notice of redemption, as the case may be. In accounting for the issuance of the Notes and the related transaction costs, we separated the Notes into liability and equity components. The carrying amount of the liability component was initially calculated by measuring the fair value of similar liabilities that do not have associated convertible features utilizing the interest rate of 5.75%. The carrying amount of the equity component representing the conversion option was $278.5 million and was determined by deducting the fair value of the liability component from the par value of the Notes. This difference represents the debt discount that is amortized to interest expense over the term of the Notes using the effective interest rate method. The equity component was recorded in additional paid-in capital and is not remeasured as long as it continues to meet the conditions for equity classification. Total issuance costs of $19.5 million related to the Notes were allocated between liability, totaling $14.8 million, and equity, totaling $4.7 million, in the same proportion as the allocation of the total proceeds to the liability and equity components. Issuance costs attributable to the liability component are being amortized to interest expense over the term of the Notes. The excess of the principal amount of the liability component over its carrying amount is amortized to interest expense over the contractual term of the Notes at an effective interest rate of 6.03%. The issuance costs attributable to the equity component were netted against additional paid-in capital. The amount recorded for the equity component of the Notes was $273.4 million, net of allocated issuance costs of $4.7 million and deferred tax impact of $0.4 million. The net carrying amount of the liability component of the Notes is as follows: July 31, 2021 2020 (in thousands) Principal amount $ 1,150,000 $ 1,150,000 Less: Unamortized debt discount 224,527 273,829 Unamortized debt issuance costs 11,935 14,556 Net carrying amount $ 913,538 $ 861,615 The following table sets forth total interest expense recognized related to the Notes: Year Ended July 31, 2021 2020 (in thousands) Contractual interest expense $ 1,441 $ 140 Amortization of debt discount 49,302 4,638 Amortization of debt issuance costs 2,621 247 Total $ 53,364 $ 5,025 The total fair value of the Notes was $1,931.7 million and $1,307.5 million as of July 31, 2021 and 2020, respectively. The fair value was determined based on the closing trading price per $1,000 of the Notes as of the last day of trading for the period. We consider the fair value of the Notes as of July 31, 2021 and 2020 to be a Level II measurement as they are not actively traded. The fair value of the Notes is primarily affected by the trading price of our common stock and market interest rates. Capped Calls In connection with the pricing of the Notes, we entered into capped call transactions with the option counterparties (the "Capped Calls"). The Capped Calls each have an initial strike price of $150.80 per share, subject to certain adjustments, which corresponds to the initial conversion price of the Notes. The Capped Calls have an initial cap price of $246.76 per share, subject to certain adjustments. The Capped Calls are generally expected to reduce potential dilution to our common stock upon any conversion of the Notes and/or offset any cash payments we are required to make in excess of the principal amount of the converted Notes, as the case may be, with such reduction and/or offset subject to a cap. The Capped Calls are subject to adjustment upon the occurrence of specified extraordinary events affecting us, including merger events, tender offers and the announcement of such events. In addition, the Capped Calls are subject to certain specified additional disruption events that may give rise to a termination of the Capped Calls, including nationalization, insolvency or delisting, changes in law, failures to deliver, insolvency filings and hedging disruptions. For accounting purposes, the Capped Calls are |
Operating Leases
Operating Leases | 12 Months Ended |
Jul. 31, 2021 | |
Leases [Abstract] | |
Operating Leases | Operating Leases The following is a summary of our operating lease costs: Year Ended July 31, 2021 2020 Real Estate Arrangements Co-Location Arrangements Total Real Estate Arrangements Co-Location Arrangements Total (in thousands) Operating lease, including imputed interest $ 6,442 $ 14,504 $ 20,946 $ 5,020 $ 8,582 $ 13,602 Short-term lease cost 1,527 694 2,221 1,399 904 2,303 Variable lease cost 3,192 3,244 6,436 1,508 1,715 3,223 Sublease income (199) — (199) (126) — (126) Total operating lease costs $ 10,962 $ 18,442 $ 29,404 $ 7,801 $ 11,201 $ 19,002 Weighted-average remaining lease term (in years) 4.7 1.9 5.1 2.0 Weighted-average discount rate 4.4 % 2.3 % 4.8 % 3.2 % The following table presents information about our leases in the consolidated balance sheets: July 31, 2021 2020 Real Estate Arrangements Co-Location Arrangements Total Real Estate Arrangements Co-Location Arrangements Total (in thousands) Operating lease right-of-use assets $ 20,829 $ 23,510 $ 44,339 $ 16,990 $ 19,129 $ 36,119 Operating lease liabilities, current $ 5,388 $ 14,454 $ 19,842 $ 5,307 $ 10,293 $ 15,600 Operating lease liabilities, noncurrent $ 20,424 $ 10,801 $ 31,225 $ 17,849 $ 10,174 $ 28,023 Cash paid, net of tenant incentives for amounts included in the measurement of operating lease liabilities was $22.1 million and $7.6 million for fiscal 2021 and fiscal 2020, respectively. For fiscal 2019, the rent expense and bandwidth and co-location expenses were $3.0 million and $13.8 million, respectively. Rent expense prior to fiscal 2020 was recognized in accordance with ASC 840, Leases, using the straight-line method over the term of the lease. Maturities of operating lease liabilities consisted of the following as of July 31, 2021: Real Estate Arrangements Co-Location Arrangements Total Year ending July 31, (in thousands) 2022 $ 6,333 $ 14,834 $ 21,167 2023 5,992 8,047 14,039 2024 5,291 2,893 8,184 2025 4,994 — 4,994 2026 5,015 — 5,015 Thereafter 840 — 840 Total future minimum lease payments 28,465 25,774 54,239 Less: Imputed interest 2,653 519 3,172 Total $ 25,812 $ 25,255 $ 51,067 As of July 31, 2021, we have entered into non-cancelable operating leases with a term greater than 12 months that have not yet commenced with undiscounted future minimum payments of $10.1 million, which are excluded from the above table. These operating leases will commence between August 2021 and October 2022 with lease terms ranging from 1.7 years to 4.0 years. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Jul. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Non-cancelable Purchase Obligations In the normal course of business, we enter into non-cancelable purchase commitments with various third parties to purchase products and services such as technology equipment, subscription-based cloud service arrangements, corporate and marketing events and consulting services. As of July 31, 2021 and 2020, we had outstanding non-cancelable purchase obligations with a term of 12 months or longer of $25.2 million and $20.0 million, respectively. The maturities of non-cancelable purchase obligations with a term of 12 months or longer consisted of the following as of July 31, 2021: Amount Year ending July 31, (in thousands) 2022 $ 10,118 2023 13,401 2024 1,725 Total $ 25,244 Legal Matters Symantec Litigation On December 12, 2016 and April 18, 2017, Symantec Corporation ("Symantec") filed two separate complaints in the U.S. District Court for the District of Delaware, alleging that "Zscaler's cloud security platform" infringed multiple U.S. patents held by Symantec (the "Symantec Cases"). The complaints in the Symantec Cases sought compensatory damages, injunctions, enhanced damages and attorney fees. In July and August 2017, the Symantec Cases were transferred to the U.S. District Court for the Northern District of California. On November 4, 2019, Broadcom, Inc. ("Broadcom") announced the completion of its acquisition of certain assets and assumption of certain liabilities of Symantec's enterprise security business, including all rights, titles, and interests in the patents asserted in the Symantec Cases. On January 12, 2020, we entered into a settlement and patent license agreement with CA, Inc., a Broadcom affiliate, pursuant to which the Symantec Cases were dismissed with prejudice effective as of January 13, 2020. In connection with the settlement, we made a payment of $15.0 million to Broadcom, and Broadcom provided us with patent licenses, a release and a covenant not to sue. We determined that there is no material future economic benefit from the acquired Broadcom license and accordingly, we recorded an expense of $15.0 million within general and administrative expenses in the consolidated statement of operations in fiscal 2020 . Finjan Litigation On December 5, 2017, Finjan, Inc. filed a complaint, in the U.S. District Court for the Northern District of California, alleging that certain of our products infringed four U.S. patents held by Finjan, Inc. and seeking compensatory damages, an injunction, enhanced damages and attorney fees. On April 30, 2019, we entered into patent license and settlement agreements with Finjan, Inc. and its affiliates (collectively "Finjan"), resolving all claims in the lawsuit, and made a payment of $7.3 million to Finjan, Inc. Pursuant to the agreements, Finjan provided us with a worldwide fully paid license to the broader Finjan patent portfolio, releases for past damages, and covenants not to sue. On May 1, 2019, the court dismissed Finjan, Inc.’s complaint with prejudice. We determined that there is no material future economic benefit from the acquired Finjan license and accordingly, we recorded an incremental expense of $4.1 million within general and administrative expenses in the consolidated statement of operations in fiscal 2019. In prior fiscal years, we had recorded accruals related to this litigation totaling $3.2 million. Other Litigation and Claims We are a party to various litigation matters from time to time and subject to claims that arise in the ordinary course of business, including patent, commercial, product liability, employment, class action, whistleblower and other litigation and claims, as well as governmental and other regulatory investigations and proceedings. In addition, third parties may from time to time assert claims against us in the form of letters and other communications. There is no pending or threatened legal proceeding to which we are a party that, in our opinion, is likely to have a material adverse effect on our future financial results or operations; however, the results of litigation and claims are inherently unpredictable. Regardless of the outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources and other factors. The expense of litigation and the timing of this expense from period to period are difficult to estimate, subject to change and could adversely affect our results of operations. |
Common Stock
Common Stock | 12 Months Ended |
Jul. 31, 2021 | |
Equity [Abstract] | |
Common Stock | Common Stock Holders of our common stock are entitled to one vote for each share of common stock held and are not entitled to receive dividends unless declared by our board of directors. Common Stock Reserved for Future Issuance The following table summarizes our shares of common stock reserved for future issuance: July 31, 2021 (in thousands) Equity awards outstanding: Stock options 2,597 Unvested restricted stock units 7,312 Committed unvested performance stock awards, based on the target number of shares 1,097 Committed unvested shares of common stock not yet issued related to our acquisition of Edgewise and Trustdome 128 Unvested performance stock awards 260 Share purchase rights committed under the employee stock purchase plan 344 Equity awards available for future grants: Equity incentive plans 21,316 Employee stock purchase plan 3,368 Stock reserved for settlement of the Convertible Senior Notes 7,626 Total 44,048 |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Jul. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation Equity Incentive Plans We adopted the Fiscal Year 2018 Equity Incentive Plan (the "2018 Plan") in fiscal 2018 and the 2007 Stock Plan (the "2007 Plan") in fiscal 2008, collectively referred to as the "Plans." Equity incentive awards which may be granted to eligible participants under the Plans include restricted stock units, restricted stock, stock options, nonstatutory stock options, stock appreciation rights, performance units and performance shares. With the establishment of the 2018 Plan, we no longer grant stock-based awards under the 2007 Plan and any shares underlying stock options that expire or terminate or are forfeited or repurchased by us under the 2007 Plan are automatically transferred to the 2018 Plan. As of July 31, 2021, a total of 31.7 million shares of common stock have been reserved for the issuance of equity awards under the 2018 Plan, of which 21.3 million shares were available for grant. The number of shares of common stock available for issuance under the 2018 Plan also includes an annual increase on the first day of each fiscal year pursuant to its automatic annual increase provision. Stock Options The stock option activity consisted of the following for fiscal 2021: Outstanding Weighted-Average Weighted-Average Aggregate (in thousands, except per share amounts) Balance as of July 31, 2020 5,175 $8.90 4.0 $ 625,904 Granted — $— Exercised (2,466) $7.39 $ 421,789 Canceled, forfeited or expired (112) $8.31 Balance as of July 31, 2021 2,597 $10.37 3.2 $ 585,829 Exercisable and expected to vest as of July 31, 2020 2,546 $6.46 3.5 $ 314,111 Exercisable and expected to vest as of July 31, 2021 1,777 $8.53 2.9 $ 404,151 The aggregate intrinsic value of the options exercised represents the difference between the fair value of our common stock on the date of exercise and their exercise price. The total intrinsic value of options exercised for fiscal 2021, fiscal 2020 and fiscal 2019 was $421.8 million, $242.4 million and $300.9 million, respectively. The weighted-average grant-date fair value per share of awards granted for fiscal 2020 was $22.76. We estimated the fair value of stock options using the Black-Scholes option pricing model with the following assumptions: Year Ended July 31 (1) 2020 Expected term (in years) 6.1 Expected stock price volatility 46.1% Risk-free interest rate 1.7% Dividend yield 0.0% (1) There were no stock options granted during fiscal 2021 and fiscal 2019. Restricted Stock Units and Performance Stock Awards The 2018 Plan allows for the grant of RSUs. Generally, RSUs are subject to a four-year vesting period, with 25% of the shares vesting approximately one year from the vesting commencing date and quarterly thereafter over the remaining vesting term. The 2018 Plan allows for the grant of PSAs. The right to earn the PSAs is subject to achievement of the defined performance metrics and continuous employment service. The performance metrics are defined and approved by the compensation committee of our board of directors or by our senior management for certain types of awards. Generally, earned PSAs are subject to additional time-based vesting. PSAs related to the fiscal 2019 performance period, totaling approximately 0.5 million shares with a weighted-average grant date fair value per share of $36.90, were forfeited effective at the end of fiscal 2019, resulting in a reversal of $3.8 million of accrued stock-based compensation expense recognized in the nine months ended April 30, 2019. Accordingly, no stock-based compensation expense was recognized for these awards in fiscal 2019. As of July 31, 2021, we determined that the service inception date for 0.1 million PSAs preceded the grant date, and we recognized $13.1 million of stock-based compensation expense associated with these PSAs in fiscal 2021. As of July 31, 2021, there were 0.7 million outstanding PSAs for which the performance metrics have not been defined as of such date. Accordingly, such awards are not considered granted for accounting purposes as of July 31, 2021 and have been excluded from the below table. The activity of RSUs and PSAs consisted of the following for fiscal 2021: Underlying Shares Weighted-Average Grant Date Fair Value Aggregate (in thousands, except per share data) Balance as of July 31, 2020 8,553 $60.72 $ 1,110,694 Granted 2,910 $172.79 Vested (2,953) $63.05 $ 530,027 Canceled or forfeited (747) $71.09 Balance as of July 31, 2021 7,763 $100.84 $ 1,831,376 Employee Stock Purchase Plan We adopted the Fiscal Year 2018 Employee Stock Purchase Plan (the "ESPP") in the third quarter of fiscal 2018. As of July 31, 2021, a total of 6.0 million shares of common stock have been reserved for issuance under the ESPP, out of which 3.7 million shares were available for grant. The number of shares reserved includes an annual increase on the first day of each fiscal year pursuant to its automatic annual increase provision. The ESPP provides for consecutive offering periods that will typically have a duration of approximately 24 months in length and is comprised of four purchase periods of approximately six months in length. The offering periods are scheduled to start on the first trading day on or after June 15 and December 15 of each year. During fiscal 2021, fiscal 2020 and fiscal 2019, employees purchased approximately 0.3 million, 0.8 million and 1.1 million shares of common stock, respectively, under the ESPP at an average purchase price of $75.92, $18.76 and $14.53, respectively with proceeds of $25.7 million, $15.3 million and $16.4 million, respectively. ESPP employee payroll contributions accrued as of July 31, 2021 and 2020, was $5.2 million and $3.5 million, respectively, and are included within accrued compensation in the consolidated balance sheets. Payroll contributions accrued as of July 31, 2021 will be used to purchase shares at the end of the current ESPP purchase period ending on December 15, 2021. Payroll contributions ultimately used to purchase shares are reclassified to stockholders' equity on the purchase date. The fair value of the purchase right for the ESPP was estimated on the grant date using the Black-Scholes option-pricing model with the following assumptions: Year Ended July 31, 2021 2020 2019 Expected term (in years) 0.5 - 2.0 0.5 - 2.0 0.5 - 2.0 Expected stock price volatility 46.2% - 67.4% 53.6% - 73.6% 44.0% - 61.9% Risk-free interest rate 0.1% - 0.2% 0.2% - 1.7% 1.9% - 2.7% Dividend yield 0.0% 0.0% 0.0% Deferred Merger Consideration In connection with the acquisition of Trustdome, as further described in Note 6, Business Combinations, certain former employees who became our employees are entitled to receive a deferred merger consideration payable in shares of our authorized common stock and RSUs. These awards are subject to time-based vesting. The fair value of these awards of approximately $10.1 million will be recognized as stock-based compensation expense on a straight-line basis over the vesting period within research and development expenses in the consolidated statements of operations. In connection with the acquisition of Edgewise, as further described in Note 6, Business Combinations, certain former employees who became our employees are entitled to receive a deferred merger consideration payable in shares of our authorized common stock. These awards are subject to time-based vesting. The fair value of these awards of approximately $9.3 million will be recognized as stock-based compensation expense on a straight-line basis over the vesting period within research and development expenses in the consolidated statements of operations. Stock-based Compensation Expense The components of stock-based compensation expense recognized in the consolidated statements of operations consisted of the following: Year Ended July 31, 2021 2020 2019 (in thousands) Cost of revenue $ 14,036 $ 7,318 $ 2,926 Sales and marketing 133,115 66,539 23,118 Research and development 67,803 30,173 15,090 General and administrative 43,581 17,365 5,289 Total $ 258,535 $ 121,395 $ 46,423 As of July 31, 2021, the unrecognized stock-based compensation cost related to outstanding equity-based awards, including awards for which the service inception date has been met but the grant date has not been met, was $729.2 million, which we expect to be amortized over a weighted-average period of 2.9 years. During fiscal 2021, fiscal 2020 and fiscal 2019, we capitalized $6.3 million, $4.4 million and $0.5 million, respectively, of stock-based compensation associated with the development of software for internal-use. |
Income Taxes
Income Taxes | 12 Months Ended |
Jul. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The following table sets forth the geographical breakdown of the income (loss) before the provision for income taxes: Year ended July 31, 2021 2020 2019 (in thousands) Domestic $ (275,189) $ (123,085) $ (34,145) International 18,011 10,357 6,233 Loss before provision for income taxes $ (257,178) $ (112,728) $ (27,912) The following table sets forth the components of the provision for income taxes: Year ended July 31, 2021 2020 2019 Current: (in thousands) Federal $ — $ — $ — State 126 45 64 Foreign 7,104 4,013 2,325 Total current tax expense 7,230 4,058 2,389 Deferred: Federal (349) (864) (1,431) State (3) (243) (107) Foreign (2,027) (563) (108) Total deferred tax expense (2,379) (1,670) (1,646) Total provision for income taxes $ 4,851 $ 2,388 $ 743 The following table presents the reconciliation of the statutory federal income tax rate to our effective tax rate: Year ended July 31, 2021 2020 2019 Tax at federal statutory rate 21.0 % 21.0 % 21.0 % State taxes — 0.2 0.1 Impact of foreign rate differential 0.4 — (0.9) Meals and entertainment (0.1) (0.2) (1.9) Stock-based compensation 43.9 37.0 147.2 Provision to return adjustments 0.1 (0.3) 1.2 U.S. tax credits 4.1 6.8 10.0 Change in valuation allowance (70.6) (65.0) (176.9) Withholding tax (0.7) (1.1) (2.4) Other — (0.5) (0.1) Effective tax rate (1.9) % (2.1) % (2.7) % Our estimated effective tax rate for the periods presented differs from the U.S. statutory rate primarily due to our foreign earnings which are taxed at different rates than the U.S. statutory rate, as well as the benefit of stock compensation deductions, offset by the impact of the valuation allowance we maintain against our U.S. federal and state deferred tax assets. During fiscal 2020 and fiscal 2019, we recognized an income tax benefit of $1.1 million and $1.4 million, respectively, as a result of a release in our valuation allowance on deferred tax assets due to deferred taxes recorded as part of the acquisition accounting of Cloudneeti, Edgewise and Appsulate. Refer to Note 6, Business Combinations, for further information. The following table presents the tax effects of temporary differences that give rise to significant portions of our deferred tax assets and liabilities: July 31, 2021 2020 (in thousands) Deferred tax assets: Net operating losses carryovers $ 341,777 $ 149,430 Accruals and reserves 7,769 3,896 Deferred revenue 33,028 27,123 Tax credits carryovers 42,225 23,573 Stock-based compensation 21,849 14,218 Property and equipment 1,273 1,002 Operating lease liabilities 10,505 8,571 Other 742 33 Gross deferred tax assets 459,168 227,846 Less: Valuation allowance (345,756) (130,236) Total deferred tax assets $ 113,412 $ 97,610 Deferred tax liabilities: Intangible assets $ (6,341) $ (4,224) Deferred contract acquisition costs (46,709) (24,727) Convertible senior notes (50,593) (61,071) Operating lease right-of-use assets (9,069) (6,978) Other — (131) Total deferred tax liabilities $ (112,712) $ (97,131) Net deferred tax assets $ 700 $ 479 A deferred tax liability has not been recognized on the excess of the amount for financial reporting over the tax basis of investments in foreign subsidiaries that are indefinitely reinvested outside the U.S. Income taxes are generally incurred upon a repatriation of assets, a sale, or a liquidation of the subsidiary. The excess of the amount for financial reporting over the tax basis in the investments in foreign subsidiaries, as well as the unrecognized deferred tax liability, are not material for the periods presented. The following table presents the change in the valuation allowance: Year ended July 31, 2021 2020 2019 (in thousands) Balance as of the beginning of the period $ 130,236 $ 103,732 $ 45,578 Change during the period 215,520 26,504 58,154 Balance as of the end of the period $ 345,756 $ 130,236 $ 103,732 The realization of deferred tax assets is dependent upon the generation of sufficient taxable income of the appropriate character in future periods. We regularly assess the ability to realize our deferred tax assets and establish a valuation allowance if it is more-likely-than-not that some portion of the deferred tax assets will not be realized. We weigh all available positive and negative evidence, including our earnings history and results of recent operations, scheduled reversals of deferred tax liabilities, projected future taxable income, and tax planning strategies. Due to the weight of objectively verifiable negative evidence, including our history of losses, we believe that it is more likely than not that our U.S. federal and, state deferred tax assets will not be realized as of July 31, 2021 and 2020, and as such, we have maintained a full valuation allowance against such deferred tax asset s. During fiscal 2019, we determined that due to the weight of objectively verifiable negative evidence, our U.K. deferred tax assets are no longer more likely than not to be realized in the future and a full valuation allowance was recorded and has been maintained as of July 31, 2021 and 2020 . The amount of the deferred tax asset considered realizable, however, could be adjusted if estimates of future taxable income during the carryforward period are reduced or increased or if objective negative evidence in the form of cumulative losses is no longer present and additional weight may be given to subjective evidence such as our projections for growth. In the event we determine that we will be able to realize all or part of our net deferred tax assets in the future, the valuation allowance against our deferred tax assets will be reversed in the period in which we make such determination. The release of a valuation allowance may cause greater volatility in the effective tax rate in the periods in which the valuation allowance is released. The valuation allowance against our U.S. federal, state and U.K. deferred tax assets increased by $215.5 million, $26.5 million and $58.2 million in fiscal 2021, fiscal 2020 and fiscal 2019, respectively. The increase in the valuation allowance in fiscal 2021, fiscal 2020 and fiscal 2019 was related to tax losses for which insufficient positive evidence exists to support their realizability. As of July 31, 2021 and 2020, we have net operating loss carryforwards for U.S. federal income tax purposes of $1,421.0 million and $626.3 million, respectively, which are available to offset future federal taxable income. Beginning in 2027, $177.7 million of the federal net operating losses will begin to expire. The remaining $1,243.3 million of the federal net operating losses will carry forward indefinitely. As of July 31, 2021 and 2020, we have net operating loss carryforwards for state income tax purposes of $396.3 million and $177.1 million, respectively. Beginning in 2024, $300.1 million of state net operating losses will begin to expire at different periods. The remaining $96.3 million of state net operating losses will carry forward indefinitely. As of July 31, 2021 and 2020 , we had foreign net operating loss carryforward of $54.6 million and $19.5 million, respectively, all of which will be carried forward indefinitely. Beginning in 2027, $0.9 million of foreign net operating losses will begin to expire. The remaining $53.7 million of foreign net operating losses will carry forward indefinitely. As of July 31, 2021, we had federal and California research and development tax credit carryforwards of approximately $34.7 million and $26.1 million, respectively. If not utilized, the federal credit carryforwards will begin expiring at different periods beginning in 2033. The California credit will be carried forward indefinitely. Federal and state tax laws impose restrictions on the utilization of net operating loss and research and development tax credit carryforwards in the event of a change in our ownership as defined by the Internal Revenue Code, Sections 382 and 383. Under Section 382 and 383 of the Code, substantial changes in our ownership and the ownership of acquired companies may limit the amount of net operating loss and research and development tax credit carryforwards that are available to offset taxable income. The annual limitation would not automatically result in the loss of net operating loss or research and development tax credit carryforwards but may limit the amount available in any given future period. We are subject to income taxes in the U.S. and various foreign jurisdictions. As of July 31, 2021, all years are open for examination and may become subject to examination in the future. Significant judgment is required in evaluating our tax positions and determining our income tax expense for the fiscal year. During the ordinary course of business, there are transactions and calculations for which the ultimate tax determination is uncertain. Our estimate of the potential outcome of any tax position is subject to management’s assessment of relevant risks, facts and circumstances existing at that time. These unrecognized tax benefits are established when we believe that certain positions might be challenged despite the belief that our tax return positions are fully supportable. We recognize interest and penalties associated with our unrecognized tax benefits as a component of our income tax expense. For the periods presented, we did not have material interest or penalties associated with the unrecognized tax benefits in the consolidated financial statements. We had $18.5 million of gross unrecognized tax benefits as of July 31, 2021, none of which would affect our effective tax rate if recognized due to our U.S. valuation allowance. The gross unrecognized tax benefits relate to income tax positions which, if recognized, would be in the form of additional deferred tax assets that would be offset by a valuation allowance. As of July 31, 2021, we do not believe that our estimates, as otherwise provided for, on such tax positions will significantly increase or decrease within the next twelve months. The changes in our gross unrecognized tax benefits for fiscal 2021 consisted of the following: Amount (in thousands) Balance as of July 31, 2019 $ 4,427 Gross increase for tax positions of prior fiscal years 1,611 Gross increase for tax positions of current fiscal years 4,471 Balance as of July 31, 2020 10,509 Gross (decrease) for tax positions of prior fiscal years (581) Gross increase for tax positions of current fiscal year 8,573 Balance as of July 31, 2021 $ 18,501 |
Net Loss Per Share
Net Loss Per Share | 12 Months Ended |
Jul. 31, 2021 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | Net Loss Per Share Basic net loss per share is computed by dividing the net loss by the weighted-average number of shares of common stock outstanding during the period, less shares subject to repurchase. The diluted net loss per share is computed by giving effect to all potential dilutive common stock equivalents outstanding for the period. For purposes of this calculation, our stock options, shares subject to repurchase from early exercised stock options, share purchase rights under the employee stock purchase plan, unvested RSUs, unvested PSAs and shares related to the Notes are con sidered to be potential common stock equivalents. Since we have reported net losses for all periods presented, we have excluded all potentially dilutive securities from the calculation of the diluted net loss per share as their effect is antidilutive and accordingly, basic and diluted net loss per share is the same for all periods presented. The following table sets forth the computation of basic and diluted net loss per share: Year Ended July 31, 2021 2020 2019 (in thousands, except per share data) Net loss $ (262,029) $ (115,116) $ (28,655) Weighted-average shares used in computing net loss per share, basic and diluted 135,654 129,323 123,566 Net loss per share, basic and diluted $ (1.93) $ (0.89) $ (0.23) The following table summarizes the outstanding potentially dilutive securities that were excluded from the computation of diluted net loss per share because the impact of including them would have been antidilutive: July 31, 2021 2020 2019 (in thousands) Unvested RSUs and shares of common stock 7,440 8,088 4,274 Stock options 2,597 5,175 8,861 Unvested PSAs (1) 562 723 — Share purchase rights under the ESPP 344 568 913 Convertible senior notes (2) 7,626 — — Total 18,569 14,554 14,048 (1) The number of unvested PSAs is estimated at 100% of the target number of shares granted and excludes unvested PSAs for which performance conditions have not been established as of July 31, 2021, as they are not considered outstanding for accounting purposes. Refer to Note 13, Stock-Based Compensation, for further information. |
Segment and Geographic Informat
Segment and Geographic Information | 12 Months Ended |
Jul. 31, 2021 | |
Risks and Uncertainties [Abstract] | |
Segment and Geographic Information | Segment and Geographic Information Our chief operating decision maker ("CODM") is our chief executive officer. We derive our revenue primarily from sales of subscription services to our cloud platform and related support services. Our CODM reviews financial information presented on a consolidated basis for the purposes of allocating resources and evaluating financial performance. Accordingly, we determined that we operate as one operating segment. Our long-lived assets consist of property and equipment and operating lease right-of-use assets, which are summarized by geographic area as follows: July 31, 2021 2020 (in thousands) United States $ 112,251 $ 74,264 Rest of the world 40,664 37,589 Total $ 152,915 $ 111,853 Refer to Note 2, Revenue Recognition for information on revenue by geography. |
401(k) Plan
401(k) Plan | 12 Months Ended |
Jul. 31, 2021 | |
Retirement Benefits [Abstract] | |
401(k) Plan | 401(k) Plan We have a defined-contribution plan intended to qualify under Section 401 of the Internal Revenue Code (the "401(k) Plan"). We contract with a third-party provider to act as a custodian and trustee, and to process and maintain the records of participant data. We make matching contributions to the plan for our employees. |
Business and Summary of Signi_2
Business and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Jul. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Fiscal Year | Fiscal Year Our fiscal year ends on July 31. References to fiscal 2021, for example, refer to our fiscal year ended July 31, 2021. |
Principles of Consolidation | Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries and have been prepared in conformity with accounting principles generally accepted in the United States ("U.S. GAAP"). All intercompany balances and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the amounts reported and disclosed in the financial statements and accompanying notes. Such estimates include, but are not limited to, the determination of revenue recognition, deferred revenue, deferred contract acquisition costs, valuation of acquired intangible assets, period of benefit generated from our deferred contract acquisition costs, allowance for doubtful accounts, valuation of common stock options and stock-based awards, useful lives of property and equipment, useful lives of acquired intangible assets, recoverability of goodwill, valuation of deferred tax assets and liabilities, loss contingencies related to litigation, fair value and effective interest rate of convertible senior notes, valuation of non-marketable equity investments and the discount rate used for operating leases. Management determines these estimates and assumptions based on historical experience and on various other assumptions that are believed to be reasonable. Actual results could differ significantly from these estimates, and such differences may be material to the consolidated financial statements. Due to the COVID-19 pandemic, there is ongoing uncertainty and significant disruption in the global economy and financial markets. We are not aware of any specific event or circumstances that would require an update to our estimates, judgments or assumptions or a revision to the carrying value of our assets or liabilities as of the date of issuance of these consolidated financial statements. These estimates, judgments and assumptions may change in the future, as new events occur or additional information is obtained. |
Foreign Currency | Foreign Currency The functional currency of our foreign subsidiaries is the U.S. dollar. Accordingly, monetary assets and liabilities of our foreign subsidiaries are re-measured into U.S. dollars at the exchange rates in effect at the reporting date, non-monetary assets and liabilities are re-measured at historical rates, revenue and expenses are re-measured at average exchange rates in |
Concentration of Risks | Concentration of Risks We generate revenue primarily from sale of subscriptions to access our cloud platform, together with related support services. Our sales team, along with our channel partner network of global telecommunications service providers, system integrators and value-added resellers (collectively "channel partners"), sells our services worldwide to organizations of all sizes. Due to the nature of our services and the terms and conditions of our contracts with our channel partners, our business could be affected unfavorably if we are not able to continue our relationships with them. Our financial instruments that are exposed to concentrations of credit risk consist primarily of cash, cash equivalents, short-term investments and accounts receivable. Although we deposit our cash with multiple financial institutions, the deposits, at times, may exceed federally insured limits. Cash equivalents and short-term investments consist of highly liquid investments in money market funds, U.S. treasury, U.S. agency securities and corporate debt securities, which are invested through financial institutions in the United States. We grant credit to our customers in the normal course of business. We monitor the financial condition of our customers to reduce credit risk. Refer to Note 2, Revenue Recognition, for information regarding customers with concentration of 10% or more of the total balance of accounts receivable, net. |
Segment Information | Segment Information We operate as one reportable and operating segment. Our chief operating decision maker is our chief executive officer, who reviews financial information presented on a consolidated basis for purposes of making operating decisions, assessing financial performance and allocating resources. |
Revenue Recognition | Revenue Recognition In accordance with Accounting Standards Codification ("ASC") Topic 606, Revenue From Contracts With Customers ("ASC 606"), revenue is recognized when a customer obtains control of promised services. The amount of revenue recognized reflects the consideration that we expect to be entitled to receive in exchange for these services. To achieve the core principle of this standard, we apply the following five steps: 1) Identify the contract with a customer We consider the terms and conditions of the contracts and our customary business practices in identifying our contracts under ASC 606. We determine we have a contract with a customer when the contract is approved, we can identify each party’s rights regarding the services to be transferred, we can identify the payment terms for the services, we have determined the customer has the ability and intent to pay and the contract has commercial substance. We apply judgment in determining the customer’s ability and intent to pay, which is based on a variety of factors, including the customer’s historical payment experience or, in the case of a new customer, credit and financial information pertaining to the customer. 2) Identify the performance obligations in the contract Performance obligations promised in a contract are identified based on the services that will be transferred to the customer that are both capable of being distinct, whereby the customer can benefit from the service either on its own or together with other resources that are readily available from third parties or from us, and are distinct in the context of the contract, whereby the transfer of the services is separately identifiable from other promises in the contract. Our performance obligations consist of (i) our subscription and support services and (ii) professional and other services. 3) Determine the transaction price The transaction price is determined based on the consideration to which we expect to be entitled in exchange for transferring services to the customer. Variable consideration is included in the transaction price if, in our judgment, it is probable that a significant future reversal of cumulative revenue under the contract will not occur. None of our contracts contain a significant financing component. 4) Allocate the transaction price to performance obligations in the contract If the contract contains a single performance obligation, the entire transaction price is allocated to the single performance obligation. Contracts that contain multiple performance obligations require an allocation of the transaction price to each performance obligation based on a relative standalone selling price ("SSP"). 5) Recognize revenue when or as we satisfy a performance obligation Revenue is recognized at the time the related performance obligation is satisfied by transferring the promised service to a customer. Revenue is recognized when control of the services is transferred to our customers, in an amount that reflects the consideration that we expect to receive in exchange for those services. We generate all our revenue from contracts with customers and apply judgment in identifying and evaluating any terms and conditions in contracts which may impact revenue recognition. Subscription and Support Revenue We generate revenue primarily from sales of subscriptions to access our cloud platform, together with related support services to our customers. Arrangements with customers do not provide the customer with the right to take possession of our software operating our cloud platform at any time. Instead, customers are granted continuous access to our cloud platform over the contractual period. A time-elapsed output method is used to measure progress because we transfer control evenly over the contractual period. Accordingly, the fixed consideration related to subscription and support revenue is generally recognized on a straight-line basis over the contract term beginning on the date that our service is made available to the customer. The typical subscription and support term is one Professional and Other Services Revenue Professional and other services revenue consists of fees associated with providing deployment advisory services that educate and assist our customers on the best use of our solutions, as well as advise customers on best practices as they deploy our solution. These services are distinct from subscription and support services. Professional services do not result in significant customization of the subscription service. Revenue from professional services provided on a time and materials basis is recognized as the services are performed. Total professional and other services revenue has historically not been material. Contracts with Multiple Performance Obligations Most of our contracts with customers contain multiple promised services consisting of: (i) our subscription and support services and (ii) professional and other services that are distinct and accounted for separately. The transaction price is allocated to the separate performance obligations on a relative SSP basis. We determine SSP based on our overall pricing objectives, taking into consideration the type of subscription and support services and professional and other services, the geographical region of the customer and the number of users. Variable Consideration Revenue from sales is recorded at the net sales price, which is the transaction price, and includes estimates of variable consideration. The amount of variable consideration that is included in the transaction price is constrained and is included in the net sales price only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue will not occur when the uncertainty is resolved. If our services do not meet certain service level commitments, our customers are entitled to receive service credits, and in certain cases, refunds, each representing a form of variable consideration. We have historically not experienced any significant incidents affecting the defined levels of reliability and performance as required by our subscription contracts. Accordingly, estimated refunds related to these agreements were not material to the periods presented. We provide rebates and other credits within our contracts with certain customers, which are estimated based on the value expected to be earned or claimed on the related sales transaction. Overall, the transaction price is reduced to reflect our estimate of the amount of consideration to which we are entitled based on the terms of the contract. Estimated rebates and other credits were not material during the periods presented. |
Accounts Receivable and Allowance | Accounts Receivable and Allowance Accounts receivable are recorded at the invoiced amount and are non-interest bearing. Accounts receivable are stated at their net realizable value, net of an allowance for doubtful accounts. We have a well-established collections history from our customers. Credit is extended to customers based on an evaluation of their financial condition and other factors. In determining the necessary allowance for doubtful accounts, we estimate the lifetime expected credit losses against the existing accounts receivable balance. Our estimate is based on certain factors including historical loss rates, current economic conditions, reasonable and supportable forecasts and customer-specific circumstances. The allowance for doubtful accounts has historically not been material. There were no material write-offs recognized in the periods presented. Accordingly, the movements in the allowance for doubtful accounts were not material for any of the periods presented. We do not have any off-balance-sheet credit exposure related to our customers. |
Cash Equivalents | We classify all highly liquid investments purchased with an original maturity of 90 days or less from the date of purchase as cash equivalents and all highly liquid investments with original maturities beyond 90 days at the time of purchase as short-term investments. Our cash equivalents and short-term investments consist of highly liquid investments in money market funds, U.S. treasury securities, U.S. government agency securities and corporate debt securities. |
Short-Term Investments | We classify our investments as available-for-sale investments and present them within current assets since these investments represent funds available for current operations and we have the ability and intent, if necessary, to liquidate any of these investments in order to meet our liquidity needs or to grow our business, including for potential business acquisitions or other strategic transactions. Our investments are carried at fair value, with unrealized gains and losses unrelated to credit loss factors reported in accumulated other comprehensive income (loss) ("AOCI"). Our investments are reviewed periodically when there is a decline in a security’s fair value below the amortized cost basis. We consider our intent to sell and whether it is more likely than not that we will be required to sell the securities before the recovery of its cost basis. If either of these criteria are triggered, the amortized cost basis of the debt security is written down to fair value through other income (expense), net. If neither criteria is met, we evaluate whether the decline in fair value below the amortized cost basis is related to credit-related factors or other factors such as interest rate fluctuations. The factors considered in this analysis include the extent the fair value is less than the amortized cost basis, whether there were changes to the rating of the security by a ratings agency, whether the issuer has failed to make scheduled interest payments and other adverse conditions as applicable. Credit-related impairment losses, limited by the amount that the fair value is less than the amortized cost basis, are recorded through an allowance for credit losses in other income (expense), net. For purposes of identifying and measuring credit-related impairments, our policy is to exclude the applicable accrued interest from both the fair value and amortized cost basis of the related debt security. Accrued interest receivable, net of the allowance for credit losses, if any, is recorded to prepaid expenses and other current assets. There were no credit-related impairments recognized on our investments during the periods presented. Interest income, amortization (accretion) of investments purchased at a premium (discount) and realized gains and losses are included in interest income in the consolidated statements of operations. We use the specific identification method to determine the cost in calculating realized gains and losses upon the sale of these investments. |
Strategic Investments | Strategic Investments Our strategic investments consist of non-marketable equity investments of privately held companies. Investments in non-marketable equity investments of privately held companies without readily determinable fair values are measured using the measurement alternative, as we have less than 20% ownership and do not have the ability to exercise significant influence over their operations. The carrying amount of non-marketable equity investments is adjusted based on observable price changes from orderly transactions for identical or similar investments of the same issuer and by impairments, when events or circumstances indicate a decline in value has occurred. Non-marketable equity investments that have been remeasured during the period due to an observable event or impairment are classified within Level 3 in the fair value hierarchy because we estimate the value based on valuation methods which may include a combination of the observable transaction price at the transaction date and other unobservable inputs including volatility, rights, and obligations of the investments we hold. Our strategic investments are included within other noncurrent assets in the consolidated balance sheets and adjustments to their carrying amounts are recorded in other income (expense), net in the consolidated statements of operations. There were no material events or circumstances impacting the carrying amount of our strategic investments during the periods presented. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Our financial instruments consist of cash equivalents, short-term investments, accounts receivable, accounts payable, accrued liabilities and convertible senior notes. Cash e quivalents and short-term investments are recorded at fair value. Accounts receivable, accounts payable and accrued liabilities are stated at their carrying value, which approximates fair value due to the short-time to the expected receipt or payment date. Assets recorded at fair value on a recurring basis in the consolidated balance sheets, consisting of cash equivalents and short-term investments, are categorized in accordance with the fair value hierarchy based upon the level of judgment associated with the inputs used to measure their fair values. Convertible senior notes are carried at the initially allocated liability value less unamortized debt discount and issuance costs on the consolidated balance sheets, and the fair value of the convertible senior notes is presented at each reporting period for disclosure purposes only. |
Property and Equipment | Property and Equipment Property and equipment, net are stated at historical cost net of accumulated depreciation. Property and equipment, excluding leasehold improvements, are depreciated using the straight-line method over the estimated useful lives of the three |
Capitalized Internal-Use Software Development Costs | Capitalized Internal-Use Software Development CostsWe capitalize certain costs incurred during the application development stage in connection with software development for our cloud security platform. Costs related to preliminary project activities and post-implementation activities are expensed as incurred. Capitalized costs are recorded as part of property and equipment in the consolidated balance sheets. Maintenance and training costs are expensed as incurred. Capitalized internal-use software is amortized on a straight-line basis over its estimated useful life, which is generally three years, and is recorded as cost of revenue in the consolidated statements of operations. |
Business Combinations | Business Combinations We account for our business combinations using the acquisition method of accounting, which requires, among other things, allocation of the fair value of purchase consideration to the tangible and intangible assets acquired and liabilities assumed at their estimated fair values on the acquisition date. The excess of the fair value of purchase consideration over the values of these identifiable assets and liabilities is recorded as goodwill. When determining the fair value of assets acquired and liabilities assumed, we make estimates and assumptions, especially with respect to intangible assets. Our estimates of fair value are based upon assumptions believed to be reasonable, but which are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates. During the measurement period, not to exceed one year from the date of acquisition, we may record adjustments to the assets acquired and liabilities assumed, with a corresponding offset to goodwill if new information is obtained related to facts and circumstances that existed as of the acquisition date. After the measurement period, any subsequent adjustments are reflected in the consolidated statements of operations. Acquisition costs, such as legal and consulting fees, are expensed as incurred. |
Goodwill and Intangible Assets | Goodwill represents the excess of the fair value of purchase consideration in a business combination over the fair value of net tangible and intangible assets acquired. Goodwill amounts are not amortized, but rather tested for impairment at least annually or more often if circumstances indicate that the carrying value may not be recoverable. No indications of impairment of goodwill were noted during the periods presented. Acquired intangible assets consist of identifiable intangible assets, including developed technology and customer relationships, resulting from business combinations. Acquired finite-lived intangible assets are initially recorded at fair value and are amortized on a straight-line basis over their estimated useful lives. Amortization expense of developed technology and customer relationships is recorded primarily within cost of revenues and sales and marketing expenses, respectively, in the consolidated statements of operations. |
Impairment of Long-Lived Assets | Long-lived assets, such as property and equipment and acquired intangible assets, are reviewed for impairment whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. We measure the recoverability of these assets by comparing the carrying amounts to the future undiscounted cash flows that these assets are expected to generate. If the total of the future undiscounted cash flows are less than the carrying amount of an asset, we record an impairment charge for the amount by which the carrying amount of the asset exceeds the fair value. |
Derivative Instruments | Derivative Instruments We enter into foreign currency forward contracts, a portion of which we designate as cash flow hedges, in order to manage the volatility of cash flows that relate to our cost of revenues and operating expenses denominated in foreign currencies. Gains or losses related to our cash flow hedges are recorded as a component of AOCI on the consolidated statements of stockholders' equity until the forecasted transaction occurs in earnings. When the forecasted transaction occurs, the related gains and losses are reclassified into earnings within the financial statement line item associated with the underlying hedged transaction. If the underlying hedged transaction does not occur, or it becomes probable that the hedged transaction will not occur, the cumulative unrealized gain or loss is reclassified immediately from AOCI into earnings within the financial statement line item associated with the underlying hedged transaction. We measure hedge effectiveness using regression analysis at hedge inception and periodically thereafter. We include time value in our effectiveness assessment. We recognize changes in the fair value of non-designated derivative instruments within other income (expense), net in the consolidated statements of operations in the same period that the fair value measurement occurs. All of our derivative instruments are measured at fair value. We have elected to present the derivative assets and derivative liabilities on a gross basis on the consolidated balance sheets. Derivative instruments are classified in the consolidated statements of cash flows as cash from operating activities, which reflect the classification of the underlying hedged transactions. |
Operating Leases | Operating Leases We enter into operating lease arrangements for real estate assets related to office space and co-location assets related to space and racks at data center facilities. We determine if an arrangement contains a lease at its inception by assessing whether there is an identified asset and whether the arrangement conveys the right to control the use of the identified asset in exchange for consideration. Operating leases related balances are included in "operating lease right-of-use assets," "operating lease liabilities," and "operating lease liabilities, noncurrent" in the consolidated balance sheets. Right-of-use assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make payments arising from the lease. Operating lease right-of-use assets and lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. Lease payments consist of the fixed payments under the arrangement. The operating lease liabilities are adjusted for any unpaid lease incentives, such as tenant improvement allowances. Variable costs, such as maintenance and utilities based on actual usage, are not included in the measurement of right-to-use assets and lease liabilities but are expensed when the event determining the amount of variable consideration to be paid occurs. As the implicit rate of our leases is not determinable, we use an incremental borrowing rate ("IBR") based on the information available at the lease commencement date in determining the present value of lease payments. The lease expense is recognized on a straight-line basis over the lease term. We generally use the base, non-cancelable lease term when recognizing the right-of-use assets and lease liabilities, unless it is reasonably certain that a renewal or termination option will be exercised. We account for lease components and non-lease components as a single lease component. Leases with a term of twelve months or less are not recognized on the consolidated balance sheets. We recognize lease expense for these leases on a straight-line basis over the term of the lease. |
Stock-Based Compensation | Stock-Based Compensation Compensation expense related to stock-based awards granted to employees and non-employees is calculated based on the fair value of stock-based awards on the date of grant. We recognize stock-based compensation expense over an award’s requisite service period based on the award’s fair value. Stock-based compensation for common stock options is recognized based on the fair value of the awards granted, determined using the Black-Scholes option pricing model. Stock-based compensation expense is recognized on a straight-line basis over the requisite service period, generally four years. Stock-based compensation for purchase rights granted under the employee stock purchase plan is based on the Black-Scholes option pricing model fair value of the number of awards estimated as of the beginning of the offering period. Stock-based compensation expense is recognized following the straight-line attribution method over the offering period. Stock-based compensation for restricted stock units is measured based on the market closing price of our common stock on the grant date. Stock-based compensation expense is recognized on a straight-line basis over the requisite service period, generally four years. Stock-based compensation for performance stock awards (“PSAs”) which have the same grant date and service inception date, is based on the probable number of shares to be attained and the market closing price of our common stock at the grant date. For PSAs where the service inception date of the awards precedes the grant date, stock-based compensation expense is recognized based on the number of PSAs for which it is probable that the performance condition will be met, using the accelerated attribution method and the market closing price of our common stock at each reporting date up to the grant date. The number of these PSAs for which it is probable that the performance condition will be met is determined using management’s best estimate at the end of each reporting period. At the completion of the performance period for these PSAs, any earned PSAs are granted upon approval of the compensation committee of our board of directors. |
Convertible Senior Notes | Convertible Senior Notes In accounting for the issuance of the convertible senior notes, we separated the convertible senior notes into liability and equity components. The carrying amounts of the liability component was calculated by measuring the fair value of similar liabilities that do not have associated convertible features. The carrying amount of the equity component representing the conversion option was determined by deducting the fair value of the liability component from the par value of the convertible senior notes as a whole. This difference represents the debt discount that is amortized to interest expense over the respective terms of the convertible senior notes using the effective interest rate method. The equity component was recorded in additional paid-in capital and is not remeasured as long as it continues to meet the conditions for equity classification. In accounting for the related debt issuance costs, we allocated the total amount incurred to the liability and equity components of the convertible senior notes based on their relative values. Issuance costs attributable to the liability component are being amortized to interest expense over the contractual term of the convertible senior notes. The issuance costs attributable to the equity component were netted against the equity component representing the conversion option in additional paid-in capital. To the extent that we receive the convertible senior notes conversion requests prior to their maturity, a portion of the equity component is classified as temporary equity, which is measured as the difference between the principal and net carrying amount of the convertible senior notes requested for conversion. Upon settlement of the conversion requests, the difference between the fair value and the amortized book value of the liability component of the convertible senior notes requested for conversion is recorded as a gain or loss on early note conversion. The fair value of the convertible senior notes is measured based on a similar liability that does not have an associated convertible feature based on the remaining term of the convertible senior notes. |
Research and Development | Research and Development Our research and development expenses support our efforts to add new features to our existing offerings and to ensure the reliability, availability and scalability of our solutions. Our cloud platform is software-driven, and our research and development teams employ software engineers in the design and the related development, testing, certification and support of our solutions. Accordingly, the majority of our research and development expenses result from employee-related costs, including salaries, bonuses, benefits, stock-based compensation and costs associated with technology tools used by our engineers. |
Advertising Expenses | Advertising ExpensesAdvertising expenses are charged to sales and marketing expenses in the consolidated statements of operations as incurred. |
Warranties and Indemnification | Warranties and Indemnification Our cloud platform is generally warranted to be free of defects under normal use and to perform substantially in accordance with the subscription agreement. Additionally, our contracts generally include provisions for indemnifying customers and channel partners against liabilities if our services infringe or misappropriate a third party’s intellectual property rights. Costs and liabilities incurred as a result of warranties and indemnification obligations were not material during the periods presented. |
Legal Contingencies | Legal Contingencies We may be subject to legal proceedings and litigation arising from time to time. We record a liability when we believe that it is both probable that a loss has been incurred and the amount can be reasonably estimated. We periodically evaluate developments in our legal matters that could affect the amount of liability that we accrue, if any, and adjust, as appropriate. Until the final resolution of any such matter for which we may be required to record a liability, there may be a loss exposure in excess of the liability recorded and such amount could be significant. We expense legal fees as incurred. |
Income Taxes | I ncome Taxes We account for income taxes using the asset and liability method. Deferred income taxes are recognized by applying the enacted statutory tax rates applicable to future years to differences between the carrying amounts of existing assets and liabilities and their respective tax bases and net operating loss and tax credit carryforwards. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the period that includes the enactment date. The measurement of deferred tax assets is reduced, if necessary, by a valuation allowance to amounts that are more likely than not to be realized. We recognize tax benefits from uncertain tax positions only if we believe that it is more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position. The tax benefits recognized in the financial statements from such positions are then measured based on the largest benefit that has a greater than 50% likelihood of being realized upon settlement. |
Comprehensive Loss | Comprehensive Loss Comprehensive loss is comprised of the net loss and other comprehensive income (loss). Our other comprehensive income (loss) includes unrealized gains and losses on available-for-sale securities and unrealized gains and losses and realized gains and losses reclassified into net loss on cash flow hedges, as reflected in the consolidated statements of comprehensive loss. |
Net Loss Per Share | Net Loss Per Share Basic net loss per share is computed by dividing the net loss by the weighted-average number of shares of common stock outstanding during the period, less shares subject to repurchase. Diluted earnings per share adjusts basic earnings per share for all potentially dilutive common stock equivalents outstanding during the period. Potentially dilutive securities consist primarily of stock options, shares subject to repurchase from early exercised stock options, share purchase rights under the employee stock purchase plan, unvested restricted stock units ("RSUs"), unvested performance stock awards ("PSAs") and shares related to convertible senior notes. Since we have reported net losses for all periods presented, we have excl uded all potentially dilutive securities from the calculation of the diluted net loss per share as their effect is antidilutive and accordingly, basic and diluted net loss per share is the same for all periods presented. |
Recently Adopted Accounting Pronouncements; Recently Issued Accounting Pronouncements Not Yet Adopted | Recently Adopted Accounting Pronouncements In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) ("ASU 2016-02"), as amended, which requires recognition of lease assets and liabilities for leases with terms of more than 12 months. This standard is effective for fiscal years beginning after December 15, 2018, with early adoption permitted. We adopted this standard effective August 1, 2019 using the transitional provision which allows for the adoption of Topic 842 to be applied on a modified retrospective basis at the beginning of the fiscal year of adoption in fiscal 2020. The adoption of this new standard resulted in the recognition of operating lease right-of-use assets of $16.9 million and operating lease liabilities of $18.0 million. We have elected the package of practical expedients permitted under the transition guidance, which allows us to carryforward our historical lease classification, our assessment on whether a contract is or contains a lease, and our initial direct costs for any leases that existed prior to adoption of the new standard. We have also elected to combine lease and non-lease components for real estate and co-location arrangements. In addition, we elected not to recognize lease liabilities and related right-of-use assets for leases that, at the lease commencement date, have a lease term of 12 months or less. In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740) ("ASU 2019-12"): Simplifying the Accounting for Income Taxes. The new standard eliminates certain exceptions related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period, and the recognition of deferred tax liabilities for outside basis differences related to changes in ownership of equity method investments and foreign subsidiaries. The guidance also simplifies aspects of accounting for franchise taxes and enacted changes in tax laws or rates, and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill. For public business entities, it is effective for fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. Early adoption is permitted. We early adopted this standard as of November 1, 2019, and it did not have a material impact to the consolidated financial statements. In June 2016, the Financial Accounting Standards Board ("FASB") issued ASU No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. This standard amends guidance on reporting credit losses for assets held at amortized cost basis and available-for-sale debt securities to require that credit losses on available-for-sale debt securities be presented as an allowance rather than as a write-down. The measurement of credit losses for newly recognized financial assets and subsequent changes in the allowance for credit losses are recorded in the statements of operations. We adopted this standard on August 1, 2020, and it did not have a material impact to the consolidated financial statements. Recently Issued Accounting Pronouncements Not Yet Adopted In June 2020, the FASB issued ASU No. 2020-06, Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40). This standard eliminates the beneficial conversion and cash conversion accounting models for convertible instruments. It also amends the accounting for certain contracts in an entity’s own equity that are currently accounted for as derivatives because of specific settlement provisions. In addition, the new guidance modifies how particular convertible instruments and certain contracts that may be settled in cash or shares impact the diluted earnings per share computation. For public business entities, it is effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years using the fully retrospective or modified retrospective method. The ASU No. 2020-06 is effective for us beginning August 1, 2022, although early adoption is permitted. We are currently evaluating the potential impact of this standard on the consolidated financial statements. |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 12 Months Ended |
Jul. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following table summarizes the revenue by region based on the shipping address of customers who have contracted to use our cloud platform: Year Ended July 31, 2021 2020 2019 Amount % Revenue Amount % Revenue Amount % Revenue (in thousands, except for percentage data) United States $ 329,299 49 % $ 210,288 49 % $ 148,807 49 % Europe, Middle East and Africa (*) 253,138 38 174,497 40 124,437 41 Asia Pacific 76,105 11 38,793 9 23,838 8 Other 14,558 2 7,691 2 5,754 2 Total $ 673,100 100 % $ 431,269 100 % $ 302,836 100 % _____ (*) Revenue from the United Kingdom represented 10% of the total revenue in the periods presented. The following table summarizes the revenue from contracts by type of customer: Year Ended July 31, 2021 2020 2019 Amount % Revenue Amount % Revenue Amount % Revenue (in thousands, except for percentage data) Channel partners $ 632,416 94 % $ 414,908 96 % $ 289,579 96 % Direct customers 40,684 6 16,361 4 13,257 4 Total $ 673,100 100 % $ 431,269 100 % $ 302,836 100 % |
Schedule of Accounts Receivable | The following table summarizes the concentration of 10% or more of the total balance of accounts receivable, net: July 31, 2021 2020 Channel partner A * 11 % * Represents less than 10%. |
Capitalized Contract Cost | The activity of the deferred contract acquisition costs consisted of the following: Year Ended July 31, 2021 2020 2019 (in thousands) Beginning balance $ 109,915 $ 69,785 $ 55,910 Capitalization of contract acquisition costs 137,673 65,052 32,526 Amortization of deferred contract acquisition costs (40,558) (24,922) (18,651) Ending balance $ 207,030 $ 109,915 $ 69,785 The outstanding balance of the deferred contract acquisition costs consisted of the following: July 31, 2021 2020 (in thousands) Deferred contract acquisition costs $ 57,373 $ 32,240 Deferred contract acquisition costs, noncurrent 149,657 77,675 Total deferred contract acquisition costs $ 207,030 $ 109,915 |
Cash Equivalents and Short-Te_2
Cash Equivalents and Short-Term Investments (Tables) | 12 Months Ended |
Jul. 31, 2021 | |
Cash and Cash Equivalents [Abstract] | |
Schedule of Cash Equivalents and Short-Term Investments | Cash equivalents and short-term investments consisted of the following as of July 31, 2021: Amortized Unrealized Unrealized Fair Value (in thousands) Cash equivalents: Money market funds $ 167,337 $ — $ — $ 167,337 U.S. government agency securities 10,999 — — 10,999 Total cash equivalents $ 178,336 $ — $ — $ 178,336 Short-term investments: U.S. treasury securities $ 387,428 $ 9 $ (17) $ 387,420 U.S. government agency securities 511,622 144 (34) 511,732 Corporate debt securities 327,512 102 (112) 327,502 Total short-term investments $ 1,226,562 $ 255 $ (163) $ 1,226,654 Total cash equivalents and short-term investments $ 1,404,898 $ 255 $ (163) $ 1,404,990 Cash equivalents and short-term investments consisted of the following as of July 31, 2020: Amortized Unrealized Unrealized Fair Value (in thousands) Cash equivalents: Money market funds $ 51,690 $ — $ — $ 51,690 U.S. treasury securities 39,997 — (1) 39,996 U.S. government agency securities 14,997 — — 14,997 Total cash equivalents $ 106,684 $ — $ (1) $ 106,683 Short-term investments: U.S. treasury securities $ 415,539 $ 152 $ (127) $ 415,564 U.S. government agency securities 595,725 186 (114) 595,797 Corporate debt securities 216,879 569 (87) 217,361 Total short-term investments $ 1,228,143 $ 907 $ (328) $ 1,228,722 Total cash equivalents and short-term investments $ 1,334,827 $ 907 $ (329) $ 1,335,405 |
Schedule of Maturities | The amortized cost and fair value of our short-term investments based on their stated maturities consisted of the following as of July 31, 2021: Amortized Fair Value (in thousands) Due within one year $800,659 $800,793 Due between one to three years 425,903 425,861 Total $1,226,562 $1,226,654 |
Schedule of Unrealized Loss on Investments | Short-term investments that were in an unrealized loss position as of July 31, 2021 consisted of the following: Less than 12 Months Greater than 12 Months Total Fair Unrealized Fair Unrealized Fair Unrealized (in thousands) U.S. treasury securities $ 306,908 $ (17) $ — $ — $ 306,908 $ (17) U.S. government agency securities 104,782 (34) — — 104,782 (34) Corporate debt securities 157,208 (112) — — 157,208 (112) Total $ 568,898 $ (163) $ — $ — $ 568,898 $ (163) Short-term investments that were in an unrealized loss position as of July 31, 2020 consisted of the following: Less than 12 Months Greater than 12 Months Total Fair Unrealized Fair Unrealized Fair Unrealized (in thousands) U.S. treasury securities $ 347,959 $ (127) $ — $ — $ 347,959 $ (127) U.S. government agency securities 340,503 (113) 5,502 (1) 346,005 (114) Corporate debt securities 105,953 (87) — — 105,953 (87) Total $ 794,415 $ (327) $ 5,502 $ (1) $ 799,917 $ (328) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Jul. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets Measured on Recurring Basis | Assets and liabilities that are measured at fair value on a recurring basis consisted of the following as of July 31, 2021: Level I Level II Level III Fair Value Quoted Prices Significant Significant (in thousands) Cash equivalents: Money market funds $ 167,337 $ 167,337 $ — $ — U.S. treasury securities 10,999 — 10,999 — Total cash equivalents $ 178,336 $ 167,337 $ 10,999 $ — Short-term investments: U.S. treasury securities $ 387,420 $ — $ 387,420 $ — U.S. government agency securities 511,732 — 511,732 — Corporate debt securities 327,502 — 327,502 — Total short-term investments $ 1,226,654 $ — $ 1,226,654 $ — Total cash equivalents and short-term investments $ 1,404,990 $ 167,337 $ 1,237,653 $ — Designated derivative instruments: Foreign currency contracts assets-current (1) $ 459 $ — $ 459 $ — Foreign currency contracts assets-noncurrent (2) $ 26 $ — $ 26 $ — Foreign currency contracts liabilities-current (3) $ 1,083 $ — $ 1,083 $ — Foreign currency contracts liabilities-noncurrent (4) $ 42 $ — $ 42 $ — Non-designated derivative instruments: Foreign currency contracts assets-current (1) $ 83 $ — $ 83 $ — Foreign currency contracts liabilities-current (3) $ 240 $ — $ 240 $ — (1) Reported as prepaid expenses and other current assets in the consolidated balance sheets. (2) Reported as other noncurrent assets in the consolidated balance sheets. (3) Reported as accrued expenses and other current liabilities in the consolidated balance sheets. (4) Reported as other noncurrent liabilities in the consolidated balance sheets. Assets that are measured at fair value on a recurring basis consisted of the following as of July 31, 2020: Level I Level II Level III Fair Value Quoted Prices Significant Significant (in thousands) Cash equivalents: Money market funds $ 51,690 $ 51,690 $ — $ — U.S. treasury securities 39,996 — 39,996 — U.S. government agency securities 14,997 — 14,997 — Total cash equivalents $ 106,683 $ 51,690 $ 54,993 $ — Short-term investments: U.S. treasury securities $ 415,564 $ — $ 415,564 $ — U.S. government agency securities 595,797 — 595,797 — Corporate debt securities 217,361 — 217,361 — Total short-term investments $ 1,228,722 $ — $ 1,228,722 $ — Total cash equivalents and short-term investments $ 1,335,405 $ 51,690 $ 1,283,715 $ — |
Property and Equipment and Pu_2
Property and Equipment and Purchased Intangible Assets (Tables) | 12 Months Ended |
Jul. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Property and equipment consisted of the following: July 31, Estimated Useful Life 2021 2020 (in thousands) Hosting equipment 3-4 years $ 130,981 $ 87,418 Computers and equipment 3-5 years 5,599 3,875 Purchased software 3 years 1,311 1,311 Capitalized internal-use software 3 years 39,542 23,081 Furniture and fixtures 5 years 1,021 1,965 Leasehold improvements Shorter of useful life or lease term 7,339 8,712 Total property and equipment, gross 185,793 126,362 Less: Accumulated depreciation and amortization (77,217) (50,628) Total property and equipment, net $ 108,576 $ 75,734 |
Business Combinations (Tables)
Business Combinations (Tables) | 12 Months Ended |
Jul. 31, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Net Assets Acquired | The allocation of the purchase price consideration consisted of the following: Amount Estimated Useful Life (in thousands) Assets acquired: Cash and other assets $ 1,347 Acquired intangible assets: Developed technology 5,600 5 years Customer relationships 2,100 5 years Goodwill 5,686 Total $ 14,733 Less liabilities assumed: Other liabilities $ 1,516 Deferred tax liability 1,558 Total $ 3,074 Total purchase price consideration $ 11,659 The allocation of the purchase price consideration consisted of the following: Amount Estimated Useful Life (in thousands) Assets acquired: Cash and other assets $ 1,611 Acquired intangible assets: Developed technology 7,200 5 years Goodwill 23,232 Total $ 32,043 Less Liabilities assumed: Other liabilities $ 277 Deferred tax liability 624 Total $ 901 Total purchase price consideration $ 31,142 The allocation of the purchase price consideration consisted of the following: Amount Estimated Useful Life (in thousands) Assets acquired: Cash and other assets $ 294 Operating lease right-of-use asset 630 Acquired intangible assets: Developed technology 13,900 5 years Customer relationships 1,300 5 years Goodwill 16,709 Total $ 32,833 Less liabilities assumed: Accounts payable and accrued liabilities $ 333 Deferred revenue 540 Operating lease liability 630 Deferred tax liability 620 Total $ 2,123 Total purchase price consideration $ 30,710 The allocation of the purchase price consideration consisted of the following: Amount Estimated Useful Life (in thousands) Assets acquired: Cash and other assets $ 66 Acquired intangible assets: Developed technology 3,500 5 years Goodwill 5,871 Total $ 9,437 Less liabilities assumed: Deferred tax liability $ 490 Other liabilities 12 Total $ 502 Total purchase price consideration $ 8,935 The allocation of the purchase price consideration, consisted of the following: Amount Estimated Useful Life (in thousands) Assets acquired: Cash and cash equivalents $ 13 Acquired intangible assets: Developed technology 7,000 4 years Goodwill 7,281 Total $ 14,294 Less liabilities assumed: Deferred tax liability $ 1,422 Total purchase price consideration $ 12,872 |
Goodwill and Acquired Intangi_2
Goodwill and Acquired Intangible Assets (Tables) | 12 Months Ended |
Jul. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The changes in the carrying amount of goodwill consisted of the following: Amount (in thousands) Balance as of July 31, 2020 $ 30,059 Goodwill acquired 28,918 Balance as of July 31, 2021 $ 58,977 |
Schedule of Acquired Intangible Assets | Acquired intangible assets subject to amortization consisted of the following as of July 31, 2021 and 2020: Gross Carrying Amount Accumulated Amortization Net Carrying Amount Weighted Average Remaining Useful life July 31, 2020 Additions July 31, 2021 July 31, 2020 Amortization Expense July 31, 2021 July 31, 2020 July 31, 2021 July 31, 2021 (in thousands) (years) Developed technology $ 26,856 $ 12,800 $ 39,656 $ (4,206) $ (6,468) $ (10,674) $ 22,650 $ 28,982 4.0 Customer relationships 1,460 2,100 3,560 (86) (327) (413) 1,374 3,147 4.5 Total $ 28,316 $ 14,900 $ 43,216 $ (4,292) $ (6,795) $ (11,087) $ 24,024 $ 32,129 4.0 |
Schedule of Future Amortization Expense | Future amortization expense of acquired intangible assets consisted of the following as of July 31, 2021: Amortization Expense (in thousands) Year ending July 31, 2022 $ 8,678 2023 8,181 2024 6,741 2025 6,038 2026 2,491 Total $ 32,129 |
Convertible Senior Notes (Table
Convertible Senior Notes (Tables) | 12 Months Ended |
Jul. 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Convertible Senior Notes | The following table presents details of the Notes: Initial Conversion Rate per $1,000 Principal Initial Conversion Price Initial Number of Shares (in thousands) Notes 6.6315 shares $150.80 7,626 The net carrying amount of the liability component of the Notes is as follows: July 31, 2021 2020 (in thousands) Principal amount $ 1,150,000 $ 1,150,000 Less: Unamortized debt discount 224,527 273,829 Unamortized debt issuance costs 11,935 14,556 Net carrying amount $ 913,538 $ 861,615 The following table sets forth total interest expense recognized related to the Notes: Year Ended July 31, 2021 2020 (in thousands) Contractual interest expense $ 1,441 $ 140 Amortization of debt discount 49,302 4,638 Amortization of debt issuance costs 2,621 247 Total $ 53,364 $ 5,025 |
Operating Leases (Tables)
Operating Leases (Tables) | 12 Months Ended |
Jul. 31, 2021 | |
Leases [Abstract] | |
Summary of Operating Lease Costs | The following is a summary of our operating lease costs: Year Ended July 31, 2021 2020 Real Estate Arrangements Co-Location Arrangements Total Real Estate Arrangements Co-Location Arrangements Total (in thousands) Operating lease, including imputed interest $ 6,442 $ 14,504 $ 20,946 $ 5,020 $ 8,582 $ 13,602 Short-term lease cost 1,527 694 2,221 1,399 904 2,303 Variable lease cost 3,192 3,244 6,436 1,508 1,715 3,223 Sublease income (199) — (199) (126) — (126) Total operating lease costs $ 10,962 $ 18,442 $ 29,404 $ 7,801 $ 11,201 $ 19,002 Weighted-average remaining lease term (in years) 4.7 1.9 5.1 2.0 Weighted-average discount rate 4.4 % 2.3 % 4.8 % 3.2 % |
Summary of Lease Assets and Liabilities | The following table presents information about our leases in the consolidated balance sheets: July 31, 2021 2020 Real Estate Arrangements Co-Location Arrangements Total Real Estate Arrangements Co-Location Arrangements Total (in thousands) Operating lease right-of-use assets $ 20,829 $ 23,510 $ 44,339 $ 16,990 $ 19,129 $ 36,119 Operating lease liabilities, current $ 5,388 $ 14,454 $ 19,842 $ 5,307 $ 10,293 $ 15,600 Operating lease liabilities, noncurrent $ 20,424 $ 10,801 $ 31,225 $ 17,849 $ 10,174 $ 28,023 |
Schedule of Lease Maturities | Maturities of operating lease liabilities consisted of the following as of July 31, 2021: Real Estate Arrangements Co-Location Arrangements Total Year ending July 31, (in thousands) 2022 $ 6,333 $ 14,834 $ 21,167 2023 5,992 8,047 14,039 2024 5,291 2,893 8,184 2025 4,994 — 4,994 2026 5,015 — 5,015 Thereafter 840 — 840 Total future minimum lease payments 28,465 25,774 54,239 Less: Imputed interest 2,653 519 3,172 Total $ 25,812 $ 25,255 $ 51,067 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Jul. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Maturities of Non-Cancelable Purchase Obligations | The maturities of non-cancelable purchase obligations with a term of 12 months or longer consisted of the following as of July 31, 2021: Amount Year ending July 31, (in thousands) 2022 $ 10,118 2023 13,401 2024 1,725 Total $ 25,244 |
Common Stock (Tables)
Common Stock (Tables) | 12 Months Ended |
Jul. 31, 2021 | |
Equity [Abstract] | |
Schedule of Common Stock | The following table summarizes our shares of common stock reserved for future issuance: July 31, 2021 (in thousands) Equity awards outstanding: Stock options 2,597 Unvested restricted stock units 7,312 Committed unvested performance stock awards, based on the target number of shares 1,097 Committed unvested shares of common stock not yet issued related to our acquisition of Edgewise and Trustdome 128 Unvested performance stock awards 260 Share purchase rights committed under the employee stock purchase plan 344 Equity awards available for future grants: Equity incentive plans 21,316 Employee stock purchase plan 3,368 Stock reserved for settlement of the Convertible Senior Notes 7,626 Total 44,048 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Jul. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Stock Options | The stock option activity consisted of the following for fiscal 2021: Outstanding Weighted-Average Weighted-Average Aggregate (in thousands, except per share amounts) Balance as of July 31, 2020 5,175 $8.90 4.0 $ 625,904 Granted — $— Exercised (2,466) $7.39 $ 421,789 Canceled, forfeited or expired (112) $8.31 Balance as of July 31, 2021 2,597 $10.37 3.2 $ 585,829 Exercisable and expected to vest as of July 31, 2020 2,546 $6.46 3.5 $ 314,111 Exercisable and expected to vest as of July 31, 2021 1,777 $8.53 2.9 $ 404,151 |
Schedule of Valuation Assumptions | We estimated the fair value of stock options using the Black-Scholes option pricing model with the following assumptions: Year Ended July 31 (1) 2020 Expected term (in years) 6.1 Expected stock price volatility 46.1% Risk-free interest rate 1.7% Dividend yield 0.0% (1) There were no stock options granted during fiscal 2021 and fiscal 2019. |
Schedule of Restricted Stock Units and Performance Stock Awards Activity | The activity of RSUs and PSAs consisted of the following for fiscal 2021: Underlying Shares Weighted-Average Grant Date Fair Value Aggregate (in thousands, except per share data) Balance as of July 31, 2020 8,553 $60.72 $ 1,110,694 Granted 2,910 $172.79 Vested (2,953) $63.05 $ 530,027 Canceled or forfeited (747) $71.09 Balance as of July 31, 2021 7,763 $100.84 $ 1,831,376 |
Schedule of ESPP Valuation Assumptions | The fair value of the purchase right for the ESPP was estimated on the grant date using the Black-Scholes option-pricing model with the following assumptions: Year Ended July 31, 2021 2020 2019 Expected term (in years) 0.5 - 2.0 0.5 - 2.0 0.5 - 2.0 Expected stock price volatility 46.2% - 67.4% 53.6% - 73.6% 44.0% - 61.9% Risk-free interest rate 0.1% - 0.2% 0.2% - 1.7% 1.9% - 2.7% Dividend yield 0.0% 0.0% 0.0% |
Schedule of Allocation of Stock-based Compensation Expense | The components of stock-based compensation expense recognized in the consolidated statements of operations consisted of the following: Year Ended July 31, 2021 2020 2019 (in thousands) Cost of revenue $ 14,036 $ 7,318 $ 2,926 Sales and marketing 133,115 66,539 23,118 Research and development 67,803 30,173 15,090 General and administrative 43,581 17,365 5,289 Total $ 258,535 $ 121,395 $ 46,423 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Jul. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income before Income Tax, Domestic and Foreign | The following table sets forth the geographical breakdown of the income (loss) before the provision for income taxes: Year ended July 31, 2021 2020 2019 (in thousands) Domestic $ (275,189) $ (123,085) $ (34,145) International 18,011 10,357 6,233 Loss before provision for income taxes $ (257,178) $ (112,728) $ (27,912) |
Schedule of Components of Income Tax Expense (Benefit) | The following table sets forth the components of the provision for income taxes: Year ended July 31, 2021 2020 2019 Current: (in thousands) Federal $ — $ — $ — State 126 45 64 Foreign 7,104 4,013 2,325 Total current tax expense 7,230 4,058 2,389 Deferred: Federal (349) (864) (1,431) State (3) (243) (107) Foreign (2,027) (563) (108) Total deferred tax expense (2,379) (1,670) (1,646) Total provision for income taxes $ 4,851 $ 2,388 $ 743 |
Schedule of Effective Income Tax Rate Reconciliation | The following table presents the reconciliation of the statutory federal income tax rate to our effective tax rate: Year ended July 31, 2021 2020 2019 Tax at federal statutory rate 21.0 % 21.0 % 21.0 % State taxes — 0.2 0.1 Impact of foreign rate differential 0.4 — (0.9) Meals and entertainment (0.1) (0.2) (1.9) Stock-based compensation 43.9 37.0 147.2 Provision to return adjustments 0.1 (0.3) 1.2 U.S. tax credits 4.1 6.8 10.0 Change in valuation allowance (70.6) (65.0) (176.9) Withholding tax (0.7) (1.1) (2.4) Other — (0.5) (0.1) Effective tax rate (1.9) % (2.1) % (2.7) % |
Schedule of Deferred Tax Assets and Liabilities | The following table presents the tax effects of temporary differences that give rise to significant portions of our deferred tax assets and liabilities: July 31, 2021 2020 (in thousands) Deferred tax assets: Net operating losses carryovers $ 341,777 $ 149,430 Accruals and reserves 7,769 3,896 Deferred revenue 33,028 27,123 Tax credits carryovers 42,225 23,573 Stock-based compensation 21,849 14,218 Property and equipment 1,273 1,002 Operating lease liabilities 10,505 8,571 Other 742 33 Gross deferred tax assets 459,168 227,846 Less: Valuation allowance (345,756) (130,236) Total deferred tax assets $ 113,412 $ 97,610 Deferred tax liabilities: Intangible assets $ (6,341) $ (4,224) Deferred contract acquisition costs (46,709) (24,727) Convertible senior notes (50,593) (61,071) Operating lease right-of-use assets (9,069) (6,978) Other — (131) Total deferred tax liabilities $ (112,712) $ (97,131) Net deferred tax assets $ 700 $ 479 |
Summary of Valuation Allowance | The following table presents the change in the valuation allowance: Year ended July 31, 2021 2020 2019 (in thousands) Balance as of the beginning of the period $ 130,236 $ 103,732 $ 45,578 Change during the period 215,520 26,504 58,154 Balance as of the end of the period $ 345,756 $ 130,236 $ 103,732 |
Schedule of Unrecognized Tax Benefits Roll Forward | The changes in our gross unrecognized tax benefits for fiscal 2021 consisted of the following: Amount (in thousands) Balance as of July 31, 2019 $ 4,427 Gross increase for tax positions of prior fiscal years 1,611 Gross increase for tax positions of current fiscal years 4,471 Balance as of July 31, 2020 10,509 Gross (decrease) for tax positions of prior fiscal years (581) Gross increase for tax positions of current fiscal year 8,573 Balance as of July 31, 2021 $ 18,501 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 12 Months Ended |
Jul. 31, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Net Loss Per Share, Basic and Diluted | The following table sets forth the computation of basic and diluted net loss per share: Year Ended July 31, 2021 2020 2019 (in thousands, except per share data) Net loss $ (262,029) $ (115,116) $ (28,655) Weighted-average shares used in computing net loss per share, basic and diluted 135,654 129,323 123,566 Net loss per share, basic and diluted $ (1.93) $ (0.89) $ (0.23) |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The following table summarizes the outstanding potentially dilutive securities that were excluded from the computation of diluted net loss per share because the impact of including them would have been antidilutive: July 31, 2021 2020 2019 (in thousands) Unvested RSUs and shares of common stock 7,440 8,088 4,274 Stock options 2,597 5,175 8,861 Unvested PSAs (1) 562 723 — Share purchase rights under the ESPP 344 568 913 Convertible senior notes (2) 7,626 — — Total 18,569 14,554 14,048 (1) The number of unvested PSAs is estimated at 100% of the target number of shares granted and excludes unvested PSAs for which performance conditions have not been established as of July 31, 2021, as they are not considered outstanding for accounting purposes. Refer to Note 13, Stock-Based Compensation, for further information. |
Segment and Geographic Inform_2
Segment and Geographic Information (Tables) | 12 Months Ended |
Jul. 31, 2021 | |
Risks and Uncertainties [Abstract] | |
Schedule of Long-Lived Assets | Our long-lived assets consist of property and equipment and operating lease right-of-use assets, which are summarized by geographic area as follows: July 31, 2021 2020 (in thousands) United States $ 112,251 $ 74,264 Rest of the world 40,664 37,589 Total $ 152,915 $ 111,853 |
Business and Summary of Signi_3
Business and Summary of Significant Accounting Policies - Narrative (Details) | 12 Months Ended | ||
Jul. 31, 2021USD ($)segment | Jul. 31, 2020USD ($) | Jul. 31, 2019USD ($) | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Number of reportable segments | segment | 1 | ||
Number of operating segments | segment | 1 | ||
Investment impairment | $ 0 | $ 0 | $ 0 |
Capitalized software costs | 16,500,000 | 13,200,000 | 3,700,000 |
Capitalized software, amortization expense | 5,900,000 | 1,400,000 | 1,000,000 |
Asset impairment charges | $ 400,000 | 700,000 | |
Requisite service period | 4 years | ||
Advertising expense | $ 11,800,000 | 11,800,000 | 8,600,000 |
Operating lease right-of-use assets | 44,339,000 | $ 36,119,000 | |
Operating lease liability | $ 51,067,000 | ||
Cumulative effect of accounting change | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Operating lease right-of-use assets | 16,900,000 | ||
Operating lease liability | $ 18,000,000 | ||
Minimum | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Contract with customer, term of contract | 1 year | ||
Estimated Useful Life | 3 years | ||
Maximum | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Contract with customer, term of contract | 3 years | ||
Estimated Useful Life | 5 years | ||
Capitalized internal-use software | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Estimated Useful Life | 3 years |
Revenue Recognition - Narrative
Revenue Recognition - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2019 | |
Disaggregation of Revenue [Line Items] | |||
Deferred revenue | $ 630.6 | $ 369.8 | |
Contract with customer, liability, revenue recognized | 335.5 | 220.9 | $ 143.9 |
Remaining performance obligation amount | $ 1,553.5 | ||
Capitalized contract cost, amortization period | 5 years | ||
Accrued sales commission | $ 46.7 | $ 21 | |
Minimum | |||
Disaggregation of Revenue [Line Items] | |||
Payment terms | 30 days | ||
Contract with customer, term of contract | 1 year | ||
Maximum | |||
Disaggregation of Revenue [Line Items] | |||
Payment terms | 90 days | ||
Contract with customer, term of contract | 3 years | ||
Transferred over Time | Product Concentration Risk | Subscription and support | Revenue Benchmark | |||
Disaggregation of Revenue [Line Items] | |||
Concentration risk percentage | 97.00% | 98.00% | 99.00% |
Revenue Recognition - Disaggreg
Revenue Recognition - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2019 | |
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 673,100 | $ 431,269 | $ 302,836 |
Geographic Concentration Risk | Revenue Benchmark | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 673,100 | $ 431,269 | $ 302,836 |
% Revenue | 100.00% | 100.00% | 100.00% |
Geographic Concentration Risk | Revenue Benchmark | United States | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 329,299 | $ 210,288 | $ 148,807 |
% Revenue | 49.00% | 49.00% | 49.00% |
Geographic Concentration Risk | Revenue Benchmark | Europe, Middle East and Africa | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 253,138 | $ 174,497 | $ 124,437 |
% Revenue | 38.00% | 40.00% | 41.00% |
Geographic Concentration Risk | Revenue Benchmark | Asia Pacific | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 76,105 | $ 38,793 | $ 23,838 |
% Revenue | 11.00% | 9.00% | 8.00% |
Geographic Concentration Risk | Revenue Benchmark | Other | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 14,558 | $ 7,691 | $ 5,754 |
% Revenue | 2.00% | 2.00% | 2.00% |
Geographic Concentration Risk | Revenue Benchmark | United Kingdom | |||
Disaggregation of Revenue [Line Items] | |||
% Revenue | 10.00% | 10.00% | 10.00% |
Customer Concentration Risk | Revenue Benchmark | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 673,100 | $ 431,269 | $ 302,836 |
% Revenue | 100.00% | 100.00% | 100.00% |
Customer Concentration Risk | Revenue Benchmark | Channel partners | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 632,416 | $ 414,908 | $ 289,579 |
% Revenue | 94.00% | 96.00% | 96.00% |
Customer Concentration Risk | Revenue Benchmark | Direct customers | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 40,684 | $ 16,361 | $ 13,257 |
% Revenue | 6.00% | 4.00% | 4.00% |
Revenue Recognition - Schedule
Revenue Recognition - Schedule of Accounts Receivable (Details) | 12 Months Ended |
Jul. 31, 2020 | |
Channel partner A | Accounts Receivable | Customer Concentration Risk | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 11.00% |
Revenue Recognition - Remaining
Revenue Recognition - Remaining Performance Obligation (Details) | Jul. 31, 2021 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-08-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation, percentage | 49.00% |
Remaining performance obligation, period | 12 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-08-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation, percentage | 97.00% |
Remaining performance obligation, period | 3 years |
Revenue Recognition - Deferred
Revenue Recognition - Deferred Contract Acquisition Costs (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2019 | |
Changes in Capitalized Contract Cost [Roll Forward] | |||
Beginning balance | $ 109,915 | $ 69,785 | $ 55,910 |
Capitalization of contract acquisition costs | 137,673 | 65,052 | 32,526 |
Amortization of deferred contract acquisition costs | (40,558) | (24,922) | (18,651) |
Ending balance | 207,030 | 109,915 | 69,785 |
Deferred contract acquisition costs | 57,373 | 32,240 | |
Deferred contract acquisition costs, noncurrent | 149,657 | 77,675 | |
Total deferred contract acquisition costs | $ 207,030 | $ 109,915 | $ 69,785 |
Cash Equivalents and Short-Te_3
Cash Equivalents and Short-Term Investments - Schedule of Cash Equivalents and Short-term Investments (Details) - USD ($) $ in Thousands | Jul. 31, 2021 | Jul. 31, 2020 |
Debt Securities, Available-for-sale [Line Items] | ||
Cash equivalents, amortized cost | $ 178,336 | $ 106,684 |
Cash equivalents, unrealized gains | 0 | 0 |
Cash equivalents, unrealized losses | 0 | (1) |
Cash equivalents, fair value | 178,336 | 106,683 |
Short-term investments, amortized cost basis | 1,226,562 | 1,228,143 |
Short-term investment, unrealized gains | 255 | 907 |
Short-term investments, unrealized losses | (163) | (328) |
Short-term investments | 1,226,654 | 1,228,722 |
Cash equivalents and short-term investments, amortized cost | 1,404,898 | 1,334,827 |
Cash equivalents and short-term investments, unrealized gains | 255 | 907 |
Cash equivalents and short-term investments, unrealized losses | (163) | (329) |
Cash equivalents and short-term investments, estimated fair value | 1,404,990 | 1,335,405 |
Money market funds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Cash equivalents, amortized cost | 167,337 | 51,690 |
Cash equivalents, unrealized gains | 0 | 0 |
Cash equivalents, unrealized losses | 0 | 0 |
Cash equivalents, fair value | 167,337 | 51,690 |
U.S. treasury securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Cash equivalents, amortized cost | 39,997 | |
Cash equivalents, unrealized gains | 0 | |
Cash equivalents, unrealized losses | (1) | |
Cash equivalents, fair value | 39,996 | |
Short-term investments, amortized cost basis | 387,428 | 415,539 |
Short-term investment, unrealized gains | 9 | 152 |
Short-term investments, unrealized losses | (17) | (127) |
Short-term investments | 387,420 | 415,564 |
U.S. government agency securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Cash equivalents, amortized cost | 10,999 | 14,997 |
Cash equivalents, unrealized gains | 0 | 0 |
Cash equivalents, unrealized losses | 0 | 0 |
Cash equivalents, fair value | 10,999 | 14,997 |
Short-term investments, amortized cost basis | 511,622 | 595,725 |
Short-term investment, unrealized gains | 144 | 186 |
Short-term investments, unrealized losses | (34) | (114) |
Short-term investments | 511,732 | 595,797 |
Corporate debt securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Short-term investments, amortized cost basis | 327,512 | 216,879 |
Short-term investment, unrealized gains | 102 | 569 |
Short-term investments, unrealized losses | (112) | (87) |
Short-term investments | $ 327,502 | $ 217,361 |
Cash Equivalents and Short-Te_4
Cash Equivalents and Short-Term Investments - Schedule of Maturities (Details) - USD ($) $ in Thousands | Jul. 31, 2021 | Jul. 31, 2020 |
Cash and Cash Equivalents [Abstract] | ||
Due within one year, amortized cost | $ 800,659 | |
Due within one year, fair value | 800,793 | |
Due between one and two years, amortized cost | 425,903 | |
Due between one and two years, fair value | 425,861 | |
Short-term investments, amortized cost basis | 1,226,562 | $ 1,228,143 |
Total short-term investments, fair value | $ 1,226,654 | $ 1,228,722 |
Cash Equivalents and Short-Te_5
Cash Equivalents and Short-Term Investments - Schedule of Unrealized Position (Details) - USD ($) $ in Thousands | Jul. 31, 2021 | Jul. 31, 2020 |
Debt Securities, Available-for-sale [Line Items] | ||
Less than 12 months, fair value | $ 568,898 | $ 794,415 |
Less than 12 months, unrealized losses | (163) | (327) |
Greater than 12 months, fair value | 0 | 5,502 |
Greater than 12 months, unrealized losses | 0 | (1) |
Total fair value | 568,898 | 799,917 |
Total unrealized losses | (163) | (328) |
U.S. treasury securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Less than 12 months, fair value | 306,908 | 347,959 |
Less than 12 months, unrealized losses | (17) | (127) |
Greater than 12 months, fair value | 0 | 0 |
Greater than 12 months, unrealized losses | 0 | 0 |
Total fair value | 306,908 | 347,959 |
Total unrealized losses | (17) | (127) |
U.S. government agency securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Less than 12 months, fair value | 104,782 | 340,503 |
Less than 12 months, unrealized losses | (34) | (113) |
Greater than 12 months, fair value | 0 | 5,502 |
Greater than 12 months, unrealized losses | 0 | (1) |
Total fair value | 104,782 | 346,005 |
Total unrealized losses | (34) | (114) |
Corporate debt securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Less than 12 months, fair value | 157,208 | 105,953 |
Less than 12 months, unrealized losses | (112) | (87) |
Greater than 12 months, fair value | 0 | 0 |
Greater than 12 months, unrealized losses | 0 | 0 |
Total fair value | 157,208 | 105,953 |
Total unrealized losses | $ (112) | $ (87) |
Cash Equivalents and Short-Te_6
Cash Equivalents and Short-Term Investments - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | |
Jul. 31, 2021 | Jul. 31, 2020 | |
Cash and Cash Equivalents [Abstract] | ||
Accrued interest | $ 3.9 | $ 3.8 |
Non-marketable equity securities without readily determinable fair value | 3.1 | |
Carrying value | $ 5.1 | $ 2 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Thousands | Jul. 31, 2021 | Jul. 31, 2020 |
Cash equivalents: | ||
Total | $ 178,336 | $ 106,683 |
Short-term investments: | ||
Total short-term investments | 1,226,654 | 1,228,722 |
Fair Value, Measurements, Recurring | ||
Cash equivalents: | ||
Total | 178,336 | 106,683 |
Short-term investments: | ||
Total short-term investments | 1,226,654 | 1,228,722 |
Total cash equivalents and short-term investments | 1,404,990 | 1,335,405 |
Fair Value, Measurements, Recurring | Foreign currency contracts | Designated as Hedging Instrument | ||
Designated derivative instruments: | ||
Foreign currency contracts assets - current | 459 | |
Foreign currency contracts assets - noncurrent | 26 | |
Foreign currency contracts liabilities - current | 1,083 | |
Foreign currency contracts liabilities - noncurrent | 42 | |
Non-designated derivative instruments: | ||
Foreign currency contracts assets - current | 459 | |
Foreign currency contracts liabilities - current | 1,083 | |
Fair Value, Measurements, Recurring | Foreign currency contracts | Not Designated as Hedging Instrument | ||
Designated derivative instruments: | ||
Foreign currency contracts assets - current | 83 | |
Foreign currency contracts liabilities - current | 240 | |
Non-designated derivative instruments: | ||
Foreign currency contracts assets - current | 83 | |
Foreign currency contracts liabilities - current | 240 | |
Fair Value, Measurements, Recurring | Level I | ||
Cash equivalents: | ||
Total | 167,337 | 51,690 |
Short-term investments: | ||
Total short-term investments | 0 | 0 |
Total cash equivalents and short-term investments | 167,337 | 51,690 |
Fair Value, Measurements, Recurring | Level I | Foreign currency contracts | Designated as Hedging Instrument | ||
Designated derivative instruments: | ||
Foreign currency contracts assets - current | 0 | |
Foreign currency contracts assets - noncurrent | 0 | |
Foreign currency contracts liabilities - current | 0 | |
Foreign currency contracts liabilities - noncurrent | 0 | |
Non-designated derivative instruments: | ||
Foreign currency contracts assets - current | 0 | |
Foreign currency contracts liabilities - current | 0 | |
Fair Value, Measurements, Recurring | Level I | Foreign currency contracts | Not Designated as Hedging Instrument | ||
Designated derivative instruments: | ||
Foreign currency contracts assets - current | 0 | |
Foreign currency contracts liabilities - current | 0 | |
Non-designated derivative instruments: | ||
Foreign currency contracts assets - current | 0 | |
Foreign currency contracts liabilities - current | 0 | |
Fair Value, Measurements, Recurring | Level II | ||
Cash equivalents: | ||
Total | 10,999 | 54,993 |
Short-term investments: | ||
Total short-term investments | 1,226,654 | 1,228,722 |
Total cash equivalents and short-term investments | 1,237,653 | 1,283,715 |
Fair Value, Measurements, Recurring | Level II | Foreign currency contracts | Designated as Hedging Instrument | ||
Designated derivative instruments: | ||
Foreign currency contracts assets - current | 459 | |
Foreign currency contracts assets - noncurrent | 26 | |
Foreign currency contracts liabilities - current | 1,083 | |
Foreign currency contracts liabilities - noncurrent | 42 | |
Non-designated derivative instruments: | ||
Foreign currency contracts assets - current | 459 | |
Foreign currency contracts liabilities - current | 1,083 | |
Fair Value, Measurements, Recurring | Level II | Foreign currency contracts | Not Designated as Hedging Instrument | ||
Designated derivative instruments: | ||
Foreign currency contracts assets - current | 83 | |
Foreign currency contracts liabilities - current | 240 | |
Non-designated derivative instruments: | ||
Foreign currency contracts assets - current | 83 | |
Foreign currency contracts liabilities - current | 240 | |
Fair Value, Measurements, Recurring | Level III | ||
Cash equivalents: | ||
Total | 0 | 0 |
Short-term investments: | ||
Total short-term investments | 0 | 0 |
Total cash equivalents and short-term investments | 0 | 0 |
Fair Value, Measurements, Recurring | Level III | Foreign currency contracts | Designated as Hedging Instrument | ||
Designated derivative instruments: | ||
Foreign currency contracts assets - current | 0 | |
Foreign currency contracts assets - noncurrent | 0 | |
Foreign currency contracts liabilities - current | 0 | |
Foreign currency contracts liabilities - noncurrent | 0 | |
Non-designated derivative instruments: | ||
Foreign currency contracts assets - current | 0 | |
Foreign currency contracts liabilities - current | 0 | |
Fair Value, Measurements, Recurring | Level III | Foreign currency contracts | Not Designated as Hedging Instrument | ||
Designated derivative instruments: | ||
Foreign currency contracts assets - current | 0 | |
Foreign currency contracts liabilities - current | 0 | |
Non-designated derivative instruments: | ||
Foreign currency contracts assets - current | 0 | |
Foreign currency contracts liabilities - current | 0 | |
Money market funds | ||
Cash equivalents: | ||
Total | 167,337 | 51,690 |
Money market funds | Fair Value, Measurements, Recurring | ||
Cash equivalents: | ||
Total | 167,337 | 51,690 |
Money market funds | Fair Value, Measurements, Recurring | Level I | ||
Cash equivalents: | ||
Total | 167,337 | 51,690 |
Money market funds | Fair Value, Measurements, Recurring | Level II | ||
Cash equivalents: | ||
Total | 0 | 0 |
Money market funds | Fair Value, Measurements, Recurring | Level III | ||
Cash equivalents: | ||
Total | 0 | 0 |
U.S. treasury securities | ||
Cash equivalents: | ||
Total | 39,996 | |
Short-term investments: | ||
Total short-term investments | 387,420 | 415,564 |
U.S. treasury securities | Fair Value, Measurements, Recurring | ||
Cash equivalents: | ||
Total | 10,999 | 39,996 |
Short-term investments: | ||
Total short-term investments | 387,420 | 415,564 |
U.S. treasury securities | Fair Value, Measurements, Recurring | Level I | ||
Cash equivalents: | ||
Total | 0 | 0 |
Short-term investments: | ||
Total short-term investments | 0 | 0 |
U.S. treasury securities | Fair Value, Measurements, Recurring | Level II | ||
Cash equivalents: | ||
Total | 10,999 | 39,996 |
Short-term investments: | ||
Total short-term investments | 387,420 | 415,564 |
U.S. treasury securities | Fair Value, Measurements, Recurring | Level III | ||
Cash equivalents: | ||
Total | 0 | 0 |
Short-term investments: | ||
Total short-term investments | 0 | 0 |
U.S. government agency securities | ||
Cash equivalents: | ||
Total | 10,999 | 14,997 |
Short-term investments: | ||
Total short-term investments | 511,732 | 595,797 |
U.S. government agency securities | Fair Value, Measurements, Recurring | ||
Cash equivalents: | ||
Total | 14,997 | |
Short-term investments: | ||
Total short-term investments | 511,732 | 595,797 |
U.S. government agency securities | Fair Value, Measurements, Recurring | Level I | ||
Cash equivalents: | ||
Total | 0 | |
Short-term investments: | ||
Total short-term investments | 0 | 0 |
U.S. government agency securities | Fair Value, Measurements, Recurring | Level II | ||
Cash equivalents: | ||
Total | 14,997 | |
Short-term investments: | ||
Total short-term investments | 511,732 | 595,797 |
U.S. government agency securities | Fair Value, Measurements, Recurring | Level III | ||
Cash equivalents: | ||
Total | 0 | |
Short-term investments: | ||
Total short-term investments | 0 | 0 |
Corporate debt securities | ||
Short-term investments: | ||
Total short-term investments | 327,502 | 217,361 |
Corporate debt securities | Fair Value, Measurements, Recurring | ||
Short-term investments: | ||
Total short-term investments | 327,502 | 217,361 |
Corporate debt securities | Fair Value, Measurements, Recurring | Level I | ||
Short-term investments: | ||
Total short-term investments | 0 | 0 |
Corporate debt securities | Fair Value, Measurements, Recurring | Level II | ||
Short-term investments: | ||
Total short-term investments | 327,502 | 217,361 |
Corporate debt securities | Fair Value, Measurements, Recurring | Level III | ||
Short-term investments: | ||
Total short-term investments | $ 0 | $ 0 |
Property and Equipment and Pu_3
Property and Equipment and Purchased Intangible Assets - Schedule of Property and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jul. 31, 2021 | Jul. 31, 2020 | |
Property, Plant and Equipment [Line Items] | ||
Total property and equipment, gross | $ 185,793 | $ 126,362 |
Less: Accumulated depreciation and amortization | (77,217) | (50,628) |
Total property and equipment, net | 108,576 | 75,734 |
Hosting equipment | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment, gross | 130,981 | 87,418 |
Computers and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment, gross | $ 5,599 | 3,875 |
Purchased software | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 3 years | |
Total property and equipment, gross | $ 1,311 | 1,311 |
Capitalized internal-use software | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 3 years | |
Total property and equipment, gross | $ 39,542 | 23,081 |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 5 years | |
Total property and equipment, gross | $ 1,021 | 1,965 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment, gross | $ 7,339 | $ 8,712 |
Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 3 years | |
Minimum | Computers and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 3 years | |
Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 5 years | |
Maximum | Computers and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 5 years |
Property and Equipment and Pu_4
Property and Equipment and Purchased Intangible Assets - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2019 | |
Property, Plant and Equipment [Line Items] | |||
Historical cost | $ 43,216 | $ 28,316 | |
Accumulated amortization | 11,087 | 4,292 | |
Depreciation and amortization expense | $ 29,663 | 17,734 | $ 10,398 |
IP Addresses | |||
Property, Plant and Equipment [Line Items] | |||
Weighted Average Remaining Useful life | 10 years | ||
Historical cost | $ 3,000 | 2,500 | |
Accumulated amortization | $ 400 | $ 100 |
Business Combinations - Narrati
Business Combinations - Narrative (Details) - USD ($) $ in Thousands | Jun. 01, 2021 | Apr. 15, 2021 | May 22, 2020 | Apr. 16, 2020 | May 29, 2019 | Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2019 |
Business Acquisition [Line Items] | ||||||||
Goodwill | $ 58,977 | $ 30,059 | ||||||
Developed technology | ||||||||
Business Acquisition [Line Items] | ||||||||
Acquired intangible assets | 12,800 | |||||||
Customer relationships | ||||||||
Business Acquisition [Line Items] | ||||||||
Acquired intangible assets | 2,100 | |||||||
Smokescreen | ||||||||
Business Acquisition [Line Items] | ||||||||
Payments to acquire businesses, cash | $ 11,700 | |||||||
Goodwill | 5,686 | |||||||
Acquisition related costs | 500 | |||||||
Acquisition, deferred tax liability | 1,558 | |||||||
Smokescreen | Developed technology | ||||||||
Business Acquisition [Line Items] | ||||||||
Acquired intangible assets | 5,600 | |||||||
Smokescreen | Customer relationships | ||||||||
Business Acquisition [Line Items] | ||||||||
Acquired intangible assets | $ 2,100 | |||||||
Trustdome | ||||||||
Business Acquisition [Line Items] | ||||||||
Payments to acquire businesses, cash | $ 31,100 | |||||||
Goodwill | 23,232 | |||||||
Acquired intangible assets | 7,200 | |||||||
Acquisition related costs | $ 400 | |||||||
Acquisition, deferred tax liability | $ 624 | |||||||
Edgewise Networks | ||||||||
Business Acquisition [Line Items] | ||||||||
Payments to acquire businesses, cash | $ 30,700 | |||||||
Goodwill | 16,709 | |||||||
Acquisition related costs | 600 | |||||||
Acquisition, deferred tax liability | 620 | |||||||
Edgewise Networks | Developed technology | ||||||||
Business Acquisition [Line Items] | ||||||||
Acquired intangible assets | 13,900 | |||||||
Edgewise Networks | Customer relationships | ||||||||
Business Acquisition [Line Items] | ||||||||
Acquired intangible assets | $ 1,300 | |||||||
Cloudneeti | ||||||||
Business Acquisition [Line Items] | ||||||||
Payments to acquire businesses, cash | $ 8,900 | |||||||
Goodwill | 5,871 | |||||||
Acquired intangible assets | 3,500 | |||||||
Acquisition related costs | $ 500 | |||||||
Acquisition, deferred tax liability | $ 490 | |||||||
Appsulate, Inc. | ||||||||
Business Acquisition [Line Items] | ||||||||
Payments to acquire businesses, cash | $ 12,900 | |||||||
Goodwill | 7,281 | |||||||
Acquired intangible assets | 7,000 | |||||||
Acquisition related costs | $ 300 | |||||||
Acquisition, deferred tax liability | $ 1,422 | |||||||
Acquired Technology Company | ||||||||
Business Acquisition [Line Items] | ||||||||
Payments to acquire businesses, cash | $ 1,100 |
Business Combinations - Net Ass
Business Combinations - Net Assets Acquired (Details) - USD ($) $ in Thousands | Jun. 01, 2021 | Apr. 15, 2021 | May 22, 2020 | Apr. 16, 2020 | May 29, 2019 | Jul. 31, 2021 | Jul. 31, 2020 |
Assets acquired: | |||||||
Goodwill | $ 58,977 | $ 30,059 | |||||
Developed technology | |||||||
Assets acquired: | |||||||
Acquired intangible assets: | $ 12,800 | ||||||
Less liabilities assumed: | |||||||
Estimated Useful Life | 5 years | 4 years 2 months 12 days | |||||
Customer relationships | |||||||
Assets acquired: | |||||||
Acquired intangible assets: | $ 2,100 | ||||||
Less liabilities assumed: | |||||||
Estimated Useful Life | 4 years 8 months 12 days | ||||||
Smokescreen | |||||||
Assets acquired: | |||||||
Cash and other assets | $ 1,347 | ||||||
Goodwill | 5,686 | ||||||
Total | 14,733 | ||||||
Less liabilities assumed: | |||||||
Other liabilities | 1,516 | ||||||
Deferred tax liability | 1,558 | ||||||
Total | 3,074 | ||||||
Total purchase price consideration | 11,659 | ||||||
Smokescreen | Developed technology | |||||||
Assets acquired: | |||||||
Acquired intangible assets: | $ 5,600 | ||||||
Less liabilities assumed: | |||||||
Estimated Useful Life | 5 years | ||||||
Smokescreen | Customer relationships | |||||||
Assets acquired: | |||||||
Acquired intangible assets: | $ 2,100 | ||||||
Less liabilities assumed: | |||||||
Estimated Useful Life | 5 years | ||||||
Trustdome | |||||||
Assets acquired: | |||||||
Cash and other assets | $ 1,611 | ||||||
Acquired intangible assets: | 7,200 | ||||||
Goodwill | 23,232 | ||||||
Total | 32,043 | ||||||
Less liabilities assumed: | |||||||
Other liabilities | 277 | ||||||
Deferred tax liability | 624 | ||||||
Total | 901 | ||||||
Total purchase price consideration | $ 31,142 | ||||||
Estimated Useful Life | 5 years | ||||||
Edgewise Networks | |||||||
Assets acquired: | |||||||
Cash and other assets | $ 294 | ||||||
Operating lease right-of-use asset | 630 | ||||||
Goodwill | 16,709 | ||||||
Total | 32,833 | ||||||
Less liabilities assumed: | |||||||
Deferred tax liability | 620 | ||||||
Accounts payable and accrued liabilities | 333 | ||||||
Deferred revenue | 540 | ||||||
Operating lease liability | 630 | ||||||
Total | 2,123 | ||||||
Total purchase price consideration | 30,710 | ||||||
Edgewise Networks | Developed technology | |||||||
Assets acquired: | |||||||
Acquired intangible assets: | $ 13,900 | ||||||
Less liabilities assumed: | |||||||
Estimated Useful Life | 5 years | ||||||
Edgewise Networks | Customer relationships | |||||||
Assets acquired: | |||||||
Acquired intangible assets: | $ 1,300 | ||||||
Less liabilities assumed: | |||||||
Estimated Useful Life | 5 years | ||||||
Cloudneeti | |||||||
Assets acquired: | |||||||
Cash and other assets | $ 66 | ||||||
Acquired intangible assets: | 3,500 | ||||||
Goodwill | 5,871 | ||||||
Total | 9,437 | ||||||
Less liabilities assumed: | |||||||
Other liabilities | 12 | ||||||
Deferred tax liability | 490 | ||||||
Total | 502 | ||||||
Total purchase price consideration | $ 8,935 | ||||||
Estimated Useful Life | 5 years | ||||||
Appsulate, Inc. | |||||||
Assets acquired: | |||||||
Cash and other assets | $ 13 | ||||||
Acquired intangible assets: | 7,000 | ||||||
Goodwill | 7,281 | ||||||
Total | 14,294 | ||||||
Less liabilities assumed: | |||||||
Deferred tax liability | 1,422 | ||||||
Total purchase price consideration | $ 12,872 | ||||||
Estimated Useful Life | 4 years |
Derivative Instruments (Details
Derivative Instruments (Details) | 12 Months Ended |
Jul. 31, 2021USD ($) | |
Derivative [Line Items] | |
Derivative term of contract | 18 months |
Designated as Hedging Instrument | |
Derivative [Line Items] | |
Notional amount | $ 118,900,000 |
Not Designated as Hedging Instrument | |
Derivative [Line Items] | |
Notional amount | $ 28,200,000 |
Goodwill and Acquired Intangi_3
Goodwill and Acquired Intangible Assets - Schedule of Goodwill (Details) $ in Thousands | 12 Months Ended |
Jul. 31, 2021USD ($) | |
Goodwill [Roll Forward] | |
Balance as of July 31, 2020 | $ 30,059 |
Goodwill acquired | 28,918 |
Balance as of July 31, 2021 | $ 58,977 |
Goodwill and Acquired Intangi_4
Goodwill and Acquired Intangible Assets - Schedule of Acquired Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2019 | |
Finite-lived Intangible Assets [Roll Forward] | |||
Intangible Assets, Gross, beginning balance | $ 28,316 | ||
Additions | 14,900 | ||
Intangible Assets, Gross, ending balance | 43,216 | $ 28,316 | |
Accumulated Amortization, beginning balance | (4,292) | ||
Amortization Expense | (6,795) | (3,384) | $ (908) |
Accumulated Amortization, ending balance | (11,087) | (4,292) | |
Total | $ 32,129 | 24,024 | |
Weighted Average | |||
Finite-lived Intangible Assets [Roll Forward] | |||
Weighted Average Remaining Useful life | 4 years | ||
Developed technology | |||
Finite-lived Intangible Assets [Roll Forward] | |||
Intangible Assets, Gross, beginning balance | $ 26,856 | ||
Additions | 12,800 | ||
Intangible Assets, Gross, ending balance | 39,656 | 26,856 | |
Accumulated Amortization, beginning balance | (4,206) | ||
Amortization Expense | (6,468) | ||
Accumulated Amortization, ending balance | (10,674) | (4,206) | |
Total | $ 28,982 | 22,650 | |
Developed technology | Weighted Average | |||
Finite-lived Intangible Assets [Roll Forward] | |||
Weighted Average Remaining Useful life | 4 years | ||
Customer relationships | |||
Finite-lived Intangible Assets [Roll Forward] | |||
Intangible Assets, Gross, beginning balance | $ 1,460 | ||
Additions | 2,100 | ||
Intangible Assets, Gross, ending balance | 3,560 | 1,460 | |
Accumulated Amortization, beginning balance | (86) | ||
Amortization Expense | (327) | ||
Accumulated Amortization, ending balance | (413) | (86) | |
Total | $ 3,147 | $ 1,374 | |
Customer relationships | Weighted Average | |||
Finite-lived Intangible Assets [Roll Forward] | |||
Weighted Average Remaining Useful life | 4 years 6 months |
Goodwill and Acquired intangi_5
Goodwill and Acquired intangible Assets - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2019 | |
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Amortization expense of acquired intangible assets | $ 6,795 | $ 3,384 | $ 908 |
Developed technology | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Weighted Average Useful Life | 5 years | 4 years 2 months 12 days | |
Acquired intangible assets | $ 12,800 | ||
Amortization expense of acquired intangible assets | 6,468 | ||
Customer relationships | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Weighted Average Useful Life | 4 years 8 months 12 days | ||
Acquired intangible assets | 2,100 | ||
Amortization expense of acquired intangible assets | $ 327 |
Goodwill and Acquired Intangi_6
Goodwill and Acquired Intangible Assets - Schedule of Future Amortization Expense (Details) - USD ($) $ in Thousands | Jul. 31, 2021 | Jul. 31, 2020 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2022 | $ 8,678 | |
2023 | 8,181 | |
2024 | 6,741 | |
2025 | 6,038 | |
2026 | 2,491 | |
Total | $ 32,129 | $ 24,024 |
Convertible Senior Notes - Narr
Convertible Senior Notes - Narrative (Details) | Jun. 25, 2020USD ($)trading_day$ / shares | Jul. 31, 2021USD ($)trading_day | Jul. 31, 2020USD ($) | Jun. 02, 2025trading_day | Jul. 25, 2023USD ($) |
Debt Instrument [Line Items] | |||||
Proceeds from debt issuance | $ 1,130,500,000 | ||||
Threshold trading days | trading_day | 20 | 20 | |||
Threshold consecutive trading days | trading_day | 30 | 30 | |||
Threshold percentage of share price that triggers conversion | 130.00% | 130.00% | |||
Number of trading days | trading_day | 5 | ||||
Number of consecutive trading days | trading_day | 5 | ||||
Percentage of closing price (less than) | 98.00% | ||||
Redemption price, percentage of principal | 100.00% | ||||
Effective interest rate | 5.75% | ||||
Carrying amount of equity component | $ 278,500,000 | ||||
Unamortized debt issuance costs | 19,500,000 | $ 11,935,000 | $ 14,556,000 | ||
Equity issuance costs | 4,700,000 | ||||
Net carrying amount of equity component | 273,400,000 | ||||
Deferred tax impact | $ 400,000 | ||||
Fair value of notes | $ 1,931,700,000 | 1,307,500,000 | |||
Initial strike price (in dollars per share) | $ / shares | $ 150.80 | ||||
Initial cap price (in shares) | $ / shares | $ 246.76 | ||||
Net cost of capped call | $ 145,200,000 | $ 145,245,000 | |||
Long-term Debt | |||||
Debt Instrument [Line Items] | |||||
Unamortized debt issuance costs | 14,800,000 | ||||
Forecast | |||||
Debt Instrument [Line Items] | |||||
Threshold trading days | trading_day | 20 | ||||
Threshold consecutive trading days | trading_day | 30 | ||||
Threshold percentage of share price that triggers conversion | 130.00% | ||||
Redemption price, percentage of principal | 100.00% | ||||
Minimum principal amount outstanding not subject to partial redemption | $ 100,000,000 | ||||
Convertible Senior Notes Due 2025 | |||||
Debt Instrument [Line Items] | |||||
Principal amount | $ 1,150,000,000 | ||||
Interest rate | 0.125% | ||||
Effective interest rate | 6.03% | ||||
Convertible Senior Notes, $150 million | |||||
Debt Instrument [Line Items] | |||||
Principal amount | $ 150,000,000 |
Convertible Senior Notes - Summ
Convertible Senior Notes - Summary of Notes (Details) shares in Thousands | Jun. 25, 2020shares$ / shares | Jul. 31, 2021shares$ / shares |
Debt Disclosure [Abstract] | ||
Conversion ratio per $1,000 principal | 0.0066 | |
Initial conversion price (in dollars per share) | $ / shares | $ 150.80 | $ 150.80 |
Initial Number of Shares (in shares) | shares | 7,626 | 7,600 |
Convertible Senior Notes - Carr
Convertible Senior Notes - Carrying Amounts (Details) - USD ($) $ in Thousands | Jul. 31, 2021 | Jul. 31, 2020 | Jun. 25, 2020 |
Convertible Debt [Abstract] | |||
Principal amount | $ 1,150,000 | $ 1,150,000 | |
Unamortized debt discount | 224,527 | 273,829 | |
Unamortized debt issuance costs | 11,935 | 14,556 | $ 19,500 |
Net carrying amount | $ 913,538 | $ 861,615 |
Convertible Senior Notes - Inte
Convertible Senior Notes - Interest Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jul. 31, 2021 | Jul. 31, 2020 | |
Debt Disclosure [Abstract] | ||
Contractual interest expense | $ 1,441 | $ 140 |
Amortization of debt discount | 49,302 | 4,638 |
Amortization of debt issuance costs | 2,621 | 247 |
Total | $ 53,364 | $ 5,025 |
Operating Leases - Lease Costs
Operating Leases - Lease Costs (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jul. 31, 2021 | Jul. 31, 2020 | |
Lessee, Lease, Description [Line Items] | ||
Operating lease, including imputed interest | $ 20,946 | $ 13,602 |
Short-term lease cost | 2,221 | 2,303 |
Variable lease cost | 6,436 | 3,223 |
Sublease income | (199) | (126) |
Total operating lease costs | 29,404 | 19,002 |
Real Estate Arrangements | ||
Lessee, Lease, Description [Line Items] | ||
Operating lease, including imputed interest | 6,442 | 5,020 |
Short-term lease cost | 1,527 | 1,399 |
Variable lease cost | 3,192 | 1,508 |
Sublease income | (199) | (126) |
Total operating lease costs | $ 10,962 | $ 7,801 |
Weighted-average remaining lease term (in years) | 4 years 8 months 12 days | 5 years 1 month 6 days |
Weighted-average discount rate | 4.40% | 4.80% |
Co-Location Arrangements | ||
Lessee, Lease, Description [Line Items] | ||
Operating lease, including imputed interest | $ 14,504 | $ 8,582 |
Short-term lease cost | 694 | 904 |
Variable lease cost | 3,244 | 1,715 |
Sublease income | 0 | 0 |
Total operating lease costs | $ 18,442 | $ 11,201 |
Weighted-average remaining lease term (in years) | 1 year 10 months 24 days | 2 years |
Weighted-average discount rate | 2.30% | 3.20% |
Operating Leases - Assets and L
Operating Leases - Assets and Liabilities (Details) - USD ($) $ in Thousands | Jul. 31, 2021 | Jul. 31, 2020 |
Lessee, Lease, Description [Line Items] | ||
Operating lease right-of-use assets | $ 44,339 | $ 36,119 |
Operating lease liabilities, current | 19,842 | 15,600 |
Operating lease liabilities, noncurrent | 31,225 | 28,023 |
Real Estate Arrangements | ||
Lessee, Lease, Description [Line Items] | ||
Operating lease right-of-use assets | 20,829 | 16,990 |
Operating lease liabilities, current | 5,388 | 5,307 |
Operating lease liabilities, noncurrent | 20,424 | 17,849 |
Co-Location Arrangements | ||
Lessee, Lease, Description [Line Items] | ||
Operating lease right-of-use assets | 23,510 | 19,129 |
Operating lease liabilities, current | 14,454 | 10,293 |
Operating lease liabilities, noncurrent | $ 10,801 | $ 10,174 |
Operating Leases - Narrative (D
Operating Leases - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2019 | |
Lessee, Lease, Description [Line Items] | |||
Operating lease, payments | $ 22,051 | $ 7,604 | $ 0 |
Rent expense | 3,000 | ||
Bandwidth and co-location costs | $ 13,800 | ||
Operating lease, not yet commenced, amount | $ 10,100 | ||
Minimum | |||
Lessee, Lease, Description [Line Items] | |||
Operating lease, not yet commenced, term | 1 year 8 months 12 days | ||
Maximum | |||
Lessee, Lease, Description [Line Items] | |||
Operating lease, not yet commenced, term | 4 years |
Operating Leases - Future Matur
Operating Leases - Future Maturities (Details) $ in Thousands | Jul. 31, 2021USD ($) |
Lessee, Operating Lease, Liability, Payment, Due [Abstract] | |
2022 | $ 21,167 |
2023 | 14,039 |
2024 | 8,184 |
2025 | 4,994 |
2026 | 5,015 |
Thereafter | 840 |
Total future minimum lease payments | 54,239 |
Less: Imputed interest | 3,172 |
Total | 51,067 |
Real Estate Arrangements | |
Lessee, Operating Lease, Liability, Payment, Due [Abstract] | |
2022 | 6,333 |
2023 | 5,992 |
2024 | 5,291 |
2025 | 4,994 |
2026 | 5,015 |
Thereafter | 840 |
Total future minimum lease payments | 28,465 |
Less: Imputed interest | 2,653 |
Total | 25,812 |
Co-Location Arrangements | |
Lessee, Operating Lease, Liability, Payment, Due [Abstract] | |
2022 | 14,834 |
2023 | 8,047 |
2024 | 2,893 |
2025 | 0 |
2026 | 0 |
Thereafter | 0 |
Total future minimum lease payments | 25,774 |
Less: Imputed interest | 519 |
Total | $ 25,255 |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Details) $ in Thousands | Jan. 12, 2020USD ($) | Apr. 30, 2019USD ($) | Dec. 05, 2017patent | Apr. 18, 2017segment | Jul. 31, 2020USD ($) | Jul. 31, 2019USD ($) | Jul. 31, 2021USD ($) | Jul. 31, 2018USD ($) |
Loss Contingencies [Line Items] | ||||||||
Purchase obligation | $ 20,000 | $ 25,244 | ||||||
Number of patents | patent | 4 | |||||||
Symantec Cases | ||||||||
Loss Contingencies [Line Items] | ||||||||
Complaints filed | segment | 2 | |||||||
Broadcom | ||||||||
Loss Contingencies [Line Items] | ||||||||
Settlement payment | $ 15,000 | |||||||
Litigation expense | $ 15,000 | |||||||
Finjan Litigation | ||||||||
Loss Contingencies [Line Items] | ||||||||
Settlement payment | $ 7,300 | |||||||
Litigation expense | $ 4,100 | |||||||
Accrued liability for potential lawsuit loss | $ 3,200 |
Commitments and Contingencies_2
Commitments and Contingencies - Maturities (Details) - USD ($) $ in Thousands | Jul. 31, 2021 | Jul. 31, 2020 |
Commitments and Contingencies Disclosure [Abstract] | ||
2022 | $ 10,118 | |
2023 | 13,401 | |
2024 | 1,725 | |
Total | $ 25,244 | $ 20,000 |
Common Stock - Narrative (Detai
Common Stock - Narrative (Details) | Jul. 31, 2021vote |
Equity [Abstract] | |
Number of votes per share | 1 |
Common Stock - Schedule of Comm
Common Stock - Schedule of Common Stock (Details) - shares shares in Thousands | Jul. 31, 2021 | Jul. 31, 2020 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Equity awards outstanding (in shares) | 2,597 | 5,175 |
Equity awards available for future grants (in shares) | 44,048 | |
Stock options | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Equity awards outstanding (in shares) | 2,597 | |
Unvested RSUs and shares of common stock | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Equity awards outstanding (in shares) | 7,312 | |
Committed unvested performance stock awards, based on the target number of shares | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Equity awards outstanding (in shares) | 1,097 | |
Committed unvested shares of common stock not yet issued related to our acquisition of Edgewise and Trustdome | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Equity awards outstanding (in shares) | 128 | |
Unvested performance stock awards | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Equity awards outstanding (in shares) | 260 | |
Employee stock purchase plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Equity awards outstanding (in shares) | 344 | |
Equity awards available for future grants (in shares) | 3,368 | |
Equity incentive plans | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Equity awards available for future grants (in shares) | 21,316 | |
Stock reserved for settlement of the Convertible Senior Notes | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Equity awards available for future grants (in shares) | 7,626 |
Stock-Based Compensation - Narr
Stock-Based Compensation - Narrative (Details) | 9 Months Ended | 12 Months Ended | ||||
Apr. 30, 2019USD ($) | Jul. 31, 2021USD ($)period$ / sharesshares | Jul. 31, 2020USD ($)$ / sharesshares | Jul. 31, 2019USD ($)$ / sharesshares | Apr. 15, 2021USD ($) | May 22, 2020USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Shares available for grant (in shares) | shares | 21,300,000 | |||||
Options exercised, aggregate intrinsic value | $ | $ 421,789,000 | $ 242,400,000 | $ 300,900,000 | |||
Weighted average grant date fair value (in dollars per share) | $ / shares | $ 22.76 | |||||
Shares granted (in shares) | shares | 0 | 0 | ||||
Stock-based compensation expense | $ | $ 258,535,000 | $ 121,395,000 | $ 46,423,000 | |||
Weighted-average purchase price per share (in dollars per share) | $ / shares | $ 75.92 | $ 18.76 | $ 14.53 | |||
Unrecognized compensation cost | $ | $ 729,200,000 | |||||
Unrecognized compensation cost, weighted-average | 2 years 10 months 24 days | |||||
Stock based compensation capitalized | $ | $ 6,300,000 | $ 4,400,000 | $ 500,000 | |||
Trustdome | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Fair value of contingent consideration | $ | $ 10,100,000 | |||||
Edgewise Networks | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Fair value of contingent consideration | $ | $ 9,300,000 | |||||
Unvested RSUs and shares of common stock | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting period | 4 years | |||||
Performance stock units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Shares forfeited (in shares) | shares | 500,000 | |||||
Weighted-average grant date fair value of shares forfeited (in dollars per share) | $ / shares | $ 36.90 | |||||
Stock-based compensation expense | $ | $ (3,800,000) | $ 13,100,000 | $ 0 | |||
Stock options granted (in shares) | shares | 100,000 | |||||
Performance shares outstanding (in shares) | shares | 700,000 | |||||
Employee Stock | 2018 Employee Stock Purchase Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Shares available for issuance (in shares) | shares | 6,000,000 | |||||
Shares available for grant (in shares) | shares | 3,700,000 | |||||
Duration of offering period | 24 months | |||||
Number of purchases periods | period | 4 | |||||
Duration of purchase periods | 6 months | |||||
Shares issued (in shares) | shares | 300,000 | 800,000 | 1,100,000 | |||
Cash proceeds from the issuance of common stock | $ | $ 25,700,000 | $ 15,300,000 | $ 16,400,000 | |||
Accrued compensation | $ | $ 5,200,000 | $ 3,500,000 | ||||
One year anniversary | Unvested RSUs and shares of common stock | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting rights, percentage | 25.00% | |||||
Common Stock | 2018 Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Shares available for issuance (in shares) | shares | 31,700,000 |
Stock-Based Compensation - Sche
Stock-Based Compensation - Schedule of Stock Options (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2019 | |
Outstanding Stock Options | |||
Balance (in shares) | 5,175,000 | ||
Granted (in shares) | 0 | 0 | |
Exercised (in shares) | (2,466,000) | ||
Canceled, forfeited, expired (in shares) | (112,000) | ||
Balance (in shares) | 2,597,000 | 5,175,000 | |
Exercisable and expected to vest (in shares) | 1,777,000 | 2,546,000 | |
Weighted-Average Exercise Price | |||
Beginning balance (in dollars per share) | $ 8.90 | ||
Granted (in dollars per share) | 0 | ||
Exercised (in dollars per share) | 7.39 | ||
Canceled, forfeited, expired (in dollars per share) | 8.31 | ||
Ending balance (in dollars per share) | 10.37 | $ 8.90 | |
Exercisable and expected to vest (in dollars per share) | $ 8.53 | $ 6.46 | |
Additional Disclosures | |||
Options outstanding, weighted average remaining contractual term | 3 years 2 months 12 days | 4 years | |
Exercisable, weighted average remaining contractual term | 2 years 10 months 24 days | 3 years 6 months | |
Options outstanding, aggregate intrinsic value | $ 585,829 | $ 625,904 | |
Options exercised, aggregate intrinsic value | 421,789 | 242,400 | $ 300,900 |
Exercisable and expected to vest, aggregate intrinsic value | $ 404,151 | $ 314,111 |
Stock-Based Compensation - Valu
Stock-Based Compensation - Valuation Assumptions (Details) | 12 Months Ended | ||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2019 | |
Stock options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected term (in years) | 6 years 1 month 6 days | ||
Expected stock price volatility | 46.10% | ||
Risk-free interest rate | 1.70% | ||
Dividend rate | 0.00% | ||
Employee Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected stock price volatility, minimum | 46.20% | 53.60% | 44.00% |
Expected stock price volatility, maximum | 67.40% | 73.60% | 61.90% |
Risk-free interest rate, minimum | 0.10% | 0.20% | 1.90% |
Risk-free interest rate, maximum | 0.20% | 1.70% | 2.70% |
Dividend rate | 0.00% | 0.00% | 0.00% |
Minimum | Employee Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected term (in years) | 6 months | 6 months | 6 months |
Maximum | Employee Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected term (in years) | 2 years | 2 years | 2 years |
Stock-Based Compensation - RSU
Stock-Based Compensation - RSU and PSA Activity (Details) - RSUs and PSAs - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | |
Jul. 31, 2021 | Jul. 31, 2020 | |
Underlying Shares | ||
Balance (in shares) | 8,553 | |
Stock options granted (in shares) | 2,910 | |
Vested (in shares) | (2,953) | |
Canceled or forfeited (in shares) | (747) | |
Balance (in shares) | 7,763 | |
Weighted-Average Grant Date Fair Value | ||
Balance (in dollars per share) | $ 60.72 | |
Granted (in dollars per share) | 172.79 | |
Vested (in dollars per share) | 63.05 | |
Weighted-average grant date fair value of shares forfeited (in dollars per share) | 71.09 | |
Balance (in dollars per share) | $ 100.84 | |
Additional Disclosures [Abstract] | ||
Aggregate Intrinsic Value | $ 1,831,376 | $ 1,110,694 |
Aggregate Intrinsic Value, vested | $ 530,027 |
Stock-Based Compensation - Stoc
Stock-Based Compensation - Stock-based Compensation Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total | $ 258,535 | $ 121,395 | $ 46,423 |
Cost of revenue | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total | 14,036 | 7,318 | 2,926 |
Sales and marketing | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total | 133,115 | 66,539 | 23,118 |
Research and development | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total | 67,803 | 30,173 | 15,090 |
General and administrative | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total | $ 43,581 | $ 17,365 | $ 5,289 |
Income Taxes - Schedule of Inco
Income Taxes - Schedule of Income before Income Tax (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2019 | |
Income Tax Disclosure [Abstract] | |||
Domestic | $ (275,189) | $ (123,085) | $ (34,145) |
International | 18,011 | 10,357 | 6,233 |
Loss before provision for income taxes | $ (257,178) | $ (112,728) | $ (27,912) |
Income Taxes - Schedule of Comp
Income Taxes - Schedule of Components of Provision of Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2019 | |
Current: | |||
Federal | $ 0 | $ 0 | $ 0 |
State | 126 | 45 | 64 |
Foreign | 7,104 | 4,013 | 2,325 |
Total current tax expense | 7,230 | 4,058 | 2,389 |
Deferred: | |||
Federal | (349) | (864) | (1,431) |
State | (3) | (243) | (107) |
Foreign | (2,027) | (563) | (108) |
Total deferred tax expense | (2,379) | (1,670) | (1,646) |
Total provision for income taxes | $ 4,851 | $ 2,388 | $ 743 |
Income Taxes - Schedule of Reco
Income Taxes - Schedule of Reconciliation of Effective Income Tax Rate (Details) | 12 Months Ended | ||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2019 | |
Income Tax Disclosure [Abstract] | |||
Tax at federal statutory rate | 21.00% | 21.00% | 21.00% |
State taxes | 0.00% | 0.20% | 0.10% |
Impact of foreign rate differential | 0.40% | 0.00% | (0.90%) |
Meals and entertainment | (0.10%) | (0.20%) | (1.90%) |
Stock-based compensation | 43.90% | 37.00% | 147.20% |
Provision to return adjustments | 0.10% | (0.30%) | 1.20% |
U.S. tax credits | 4.10% | 6.80% | 10.00% |
Change in valuation allowance | (70.60%) | (65.00%) | (176.90%) |
Withholding tax | (0.70%) | (1.10%) | (2.40%) |
Other | 0.00% | (0.50%) | (0.10%) |
Effective tax rate | (1.90%) | (2.10%) | (2.70%) |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2019 | |
Operating Loss Carryforwards [Line Items] | |||
Income tax benefit | $ (4,851) | $ (2,388) | $ (743) |
Change during the period | 215,520 | 26,504 | 58,154 |
Unrecognized tax benefits | 18,501 | 10,509 | 4,427 |
Cloudneeti, Edgewise and Appsulate | |||
Operating Loss Carryforwards [Line Items] | |||
Income tax benefit | 1,100 | $ 1,400 | |
Federal Jurisdiction | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforward | 1,421,000 | 626,300 | |
Operating loss carryforward, subject to expiration | 177,700 | ||
Operating loss carryforward, not subject to expiration | 1,243,300 | ||
State Jurisdiction | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforward | 396,300 | 177,100 | |
Operating loss carryforward, subject to expiration | 300,100 | ||
Operating loss carryforward, not subject to expiration | 96,300 | ||
Foreign Tax Authority | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforward | 54,600 | $ 19,500 | |
Operating loss carryforward, subject to expiration | 900 | ||
Operating loss carryforward, not subject to expiration | 53,700 | ||
Research Tax Credit Carryforward | Federal Jurisdiction | |||
Operating Loss Carryforwards [Line Items] | |||
Tax credit carryforward | 34,700 | ||
Research Tax Credit Carryforward | State Jurisdiction | |||
Operating Loss Carryforwards [Line Items] | |||
Tax credit carryforward | $ 26,100 |
Income Taxes - Schedule of Co_2
Income Taxes - Schedule of Components of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2019 | Jul. 31, 2018 |
Deferred tax assets: | ||||
Net operating losses carryovers | $ 341,777 | $ 149,430 | ||
Accruals and reserves | 7,769 | 3,896 | ||
Deferred revenue | 33,028 | 27,123 | ||
Tax credits carryovers | 42,225 | 23,573 | ||
Stock-based compensation | 21,849 | 14,218 | ||
Property and equipment | 1,273 | 1,002 | ||
Operating lease liabilities | 10,505 | 8,571 | ||
Other | 742 | 33 | ||
Gross deferred tax assets | 459,168 | 227,846 | ||
Less: Valuation allowance | (345,756) | (130,236) | $ (103,732) | $ (45,578) |
Total deferred tax assets | 113,412 | 97,610 | ||
Deferred tax liabilities: | ||||
Intangible assets | (6,341) | (4,224) | ||
Deferred contract acquisition costs | (46,709) | (24,727) | ||
Convertible senior notes | (50,593) | (61,071) | ||
Operating lease right-of-use assets | (9,069) | (6,978) | ||
Other | 0 | (131) | ||
Total deferred tax liabilities | (112,712) | (97,131) | ||
Net deferred tax assets | $ 700 | $ 479 |
Income Taxes - Schedule of Valu
Income Taxes - Schedule of Valuation Allowance (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2019 | |
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance as of the beginning of the period | $ 130,236 | $ 103,732 | $ 45,578 |
Change during the period | 215,520 | 26,504 | 58,154 |
Balance as of the end of the period | $ 345,756 | $ 130,236 | $ 103,732 |
Income Taxes - Schedule of Unre
Income Taxes - Schedule of Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jul. 31, 2021 | Jul. 31, 2020 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | ||
Beginning balance | $ 10,509 | $ 4,427 |
Gross increase for tax positions of prior fiscal years | 1,611 | |
Gross increase for tax positions of current fiscal year | 8,573 | 4,471 |
Decrease for tax positions of prior fiscal years | (581) | |
Ending balance | $ 18,501 | $ 10,509 |
Net Loss Per Share- Narrative (
Net Loss Per Share- Narrative (Details) shares in Thousands | Jun. 25, 2020shares$ / shares | Jul. 31, 2021shares$ / shares |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Number of shares if notes converted (in shares) | shares | 7,626 | 7,600 |
Conversion price (in dollars per share) | $ / shares | $ 150.80 | $ 150.80 |
Unvested performance stock awards | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Number of unvested PSAs as a percentage of target | 100.00% |
Net Loss Per Share - Net Loss P
Net Loss Per Share - Net Loss Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2019 | |
Earnings Per Share [Abstract] | |||
Net loss | $ (262,029) | $ (115,116) | $ (28,655) |
Weighted-average shares used in computing net loss per share attributable to common stockholders, basic and diluted (in shares) | 135,654 | 129,323 | 123,566 |
Net loss per share attributable to common stockholders, basic and diluted (in dollars per share) | $ (1.93) | $ (0.89) | $ (0.23) |
Net Loss Per Share - Antidiluti
Net Loss Per Share - Antidilutive Securities Excluded from Computation (Details) - shares shares in Thousands | 12 Months Ended | ||
Jul. 31, 2021 | Jul. 31, 2020 | Jul. 31, 2019 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities (in shares) | 18,569 | 14,554 | 14,048 |
Unvested RSUs and shares of common stock | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities (in shares) | 7,440 | 8,088 | 4,274 |
Stock options | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities (in shares) | 2,597 | 5,175 | 8,861 |
Unvested PSAs | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities (in shares) | 562 | 723 | 0 |
Share purchase rights under the ESPP | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities (in shares) | 344 | 568 | 913 |
Convertible senior notes | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities (in shares) | 7,626 | 0 | 0 |
Segment and Geographic Inform_3
Segment and Geographic Information - Narrative (Details) | 12 Months Ended |
Jul. 31, 2021segment | |
Risks and Uncertainties [Abstract] | |
Number of operating segments | 1 |
Segment and Geographic Inform_4
Segment and Geographic Information - Schedule of Long-lived Assets (Details) - USD ($) $ in Thousands | Jul. 31, 2021 | Jul. 31, 2020 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total | $ 152,915 | $ 111,853 |
United States | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total | 112,251 | 74,264 |
Rest of the world | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total | $ 40,664 | $ 37,589 |