Cover Page
Cover Page - USD ($) $ in Millions | 7 Months Ended | 12 Months Ended | ||
Aug. 03, 2022 | Jan. 31, 2024 | Mar. 13, 2024 | Jul. 31, 2023 | |
Entity Listings [Line Items] | ||||
Document Type | 10-K | |||
Amendment Flag | false | |||
Document Annual Report | true | |||
Document Period End Date | Jan. 31, 2024 | |||
Current Fiscal Year End Date | --01-31 | |||
Document Fiscal Year Focus | 2024 | |||
Document Fiscal Period Focus | FY | |||
Document Transition Report | false | |||
Entity File Number | 001-39722 | |||
Entity Registrant Name | ZeroFox Holdings, Inc. | |||
Entity Central Index Key | 0001823575 | |||
Entity Incorporation, State or Country Code | DE | |||
Entity Tax Identification Number | 98-1557361 | |||
Entity Address, Address Line One | 1834 S. Charles Street | |||
Entity Address, City or Town | Baltimore | |||
Entity Address, State or Province | MD | |||
Entity Address, Postal Zip Code | 21230 | |||
City Area Code | 855 | |||
Local Phone Number | 936-9369 | |||
Entity Well-known Seasoned Issuer | No | |||
Entity Voluntary Filers | No | |||
Entity Current Reporting Status | Yes | |||
Entity Interactive Data Current | Yes | |||
Entity Filer Category | Accelerated Filer | |||
Entity Small Business | true | |||
Entity Emerging Growth Company | true | |||
Entity Ex Transition Period | false | |||
ICFR Auditor Attestation Flag | false | |||
Document Financial Statement Error Correction [Flag] | false | |||
Entity Shell Company | false | |||
Entity Common Stock, Shares Outstanding | 124,843,024 | |||
Entity Public Float | $ 87.4 | |||
Auditor Name | Deloitte & Touche LLP | Deloitte & Touche LLP | ||
Auditor Firm ID | 34 | 34 | ||
Auditor Location | McLean, Virginia | McLean, Virginia | ||
Documents Incorporated by Reference | DOCUMENTS INCORPORATED BY REFERENCE Portions of the Registrant's definitive Proxy Statement relating to the 2024 annual meeting of stockholders (the Proxy Statement) are incorporated herein by reference in Part III of this Annual Report on Form 10-K (the Annual Report). The Proxy Statement will be filed with the Securities and Exchange Commission (the SEC) within 120 days after the year ended January 31, 2024. | |||
Common Stock [Member] | ||||
Entity Listings [Line Items] | ||||
Title of 12(b) Security | Common Stock, $0.0001 par value per share | |||
Trading Symbol | ZFOX | |||
Security Exchange Name | NASDAQ | |||
Common Stock Warrants [Member] | ||||
Entity Listings [Line Items] | ||||
Title of 12(b) Security | Warrants, each whole warrant exercisable for one share of Common Stock at an exercise price of $11.50 per share | |||
Trading Symbol | ZFOXW | |||
Security Exchange Name | NASDAQ |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Jan. 31, 2024 | Jan. 31, 2023 |
Current assets: | ||
Cash and cash equivalents | $ 33,149 | $ 47,549 |
Accounts receivable, net of allowance for doubtful accounts | 38,923 | 29,609 |
Deferred contract acquisition costs, current | 5,351 | 5,456 |
Prepaid expenses and other assets | 8,202 | 5,300 |
Total current assets | 85,625 | 87,914 |
Property and equipment, net of accumulated depreciation | 1,198 | 671 |
Capitalized software, net of accumulated amortization | 342 | 253 |
Deferred contract acquisition costs, net of current portion | 4,755 | 7,751 |
Acquired intangible assets, net of accumulated amortization | 233,854 | 262,444 |
Goodwill | 134,100 | 406,608 |
Operating lease right-of-use assets | 3,553 | 720 |
Other Assets | 1,410 | 550 |
Total assets | 464,837 | 766,911 |
Current liabilities: | ||
Accounts payable | 2,772 | 3,099 |
Accrued compensation, accrued expenses, and other current liabilities | 17,126 | 18,751 |
Current portion of long-term debt | 938 | 15,938 |
Deferred revenue, current | 79,406 | 47,977 |
Operating lease liabilities, current | 1,638 | 406 |
Total current liabilities | 101,880 | 86,171 |
Deferred revenue, net of current portion | 7,440 | 5,981 |
Long-term debt, net of deferred financing costs | 196,827 | 157,843 |
Other liabilities | 11,310 | 27,618 |
Operating lease liabilities, net of current portion | 2,111 | 427 |
Total liabilities | 319,568 | 278,040 |
Commitments and contingencies | ||
Stockholders' equity | ||
Common stock | 12 | 12 |
Additional paid-in capital | 1,256,593 | 1,243,637 |
Accumulated deficit | (1,110,987) | (754,677) |
Accumulated other comprehensive loss | (349) | (101) |
Total stockholders' equity | 145,269 | 488,871 |
Total liabilities and stockholders' equity | $ 464,837 | $ 766,911 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Jan. 31, 2024 | Jan. 31, 2023 |
Stockholders' equity | ||
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued (in shares) | 124,639,135 | 118,190,135 |
Common stock, shares outstanding (in shares) | 124,639,135 | 118,190,135 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss and Income - USD ($) $ in Thousands | 6 Months Ended | 7 Months Ended | 12 Months Ended | |
Jan. 31, 2023 | Aug. 03, 2022 | Aug. 03, 2022 | Jan. 31, 2024 | |
Revenue | ||||
Revenue | $ 88,386 | $ 29,237 | $ 233,300 | |
Cost of revenue | ||||
Cost of revenue | 61,825 | 8,806 | 158,336 | |
Gross profit | 26,561 | 20,431 | 74,964 | |
Operating expenses | ||||
Research and development | 12,134 | 8,092 | 31,190 | |
Sales and marketing | 35,859 | 18,516 | 73,790 | |
General and administrative | 18,218 | 10,093 | 38,758 | |
Goodwill impairment | 698,650 | 284,240 | ||
Total operating expenses | 764,861 | 36,701 | 427,978 | |
(Loss) income from operations | (738,300) | (16,270) | (353,014) | |
Other (expense) income | ||||
Interest expense, net | (7,867) | (2,965) | (15,202) | |
Change in fair value of purchase consideration liability | 2,456 | |||
Change in fair value of warrant liabilities | 5,364 | (2,059) | (349) | |
Change in fair value of sponsor earnout shares | 9,634 | 2,053 | ||
Total other (expense) income | 7,131 | (5,024) | (11,042) | |
Loss before income taxes | (731,169) | (21,294) | (364,056) | |
(Benefit from) provision for income taxes | (10,522) | 111 | (7,746) | |
Net loss after tax | (720,647) | (21,405) | (356,310) | |
Net loss attributable to common stockholders, basic | $ (720,647) | $ (21,405) | $ (356,310) | |
Net loss per share attributable to common stockholders, basic | $ (6.17) | $ (0.5) | $ (2.88) | |
Net loss per share attributable to common stockholders, diluted | $ (6.17) | $ (0.5) | $ (2.88) | |
Weighted-average shares used in computation of net (loss) income per share attributable to common stockholders, basic: | 116,862,277 | 43,041,209 | 123,813,143 | |
Weighted-average shares used in computation of net (loss) income per share attributable to common stockholders, diluted: | 116,862,277 | 43,041,209 | 123,813,143 | |
Other comprehensive (loss) income | ||||
Foreign currency translation | $ (101) | $ 36 | $ (248) | |
Total other comprehensive (loss) income | (101) | 36 | (248) | |
Total comprehensive loss | (720,748) | (21,369) | (356,558) | |
ID Experts Holdings, Inc. and Subsidiary [Member] | ||||
Revenue | ||||
Revenue | $ 66,758 | |||
Cost of revenue | ||||
Cost of revenue | 52,254 | |||
Gross profit | 14,504 | |||
Operating expenses | ||||
Research and development | 3,325 | |||
Sales and marketing | 4,594 | |||
General and administrative | 5,758 | |||
Total operating expenses | 13,677 | |||
(Loss) income from operations | 827 | |||
Other (expense) income | ||||
Interest expense, net | (314) | |||
Other expense | (585) | |||
Change in fair value of warrant liabilities | (133) | |||
Total other (expense) income | (1,032) | |||
Loss before income taxes | (205) | |||
(Benefit from) provision for income taxes | 652 | |||
Net loss after tax | (857) | |||
Net loss attributable to common stockholders, basic | (857) | |||
Net loss attributable to common stockholders, diluted | $ (857) | |||
Net loss per share attributable to common stockholders, basic | $ (0.07) | |||
Net loss per share attributable to common stockholders, diluted | $ (0.07) | |||
Weighted-average shares used in computation of net (loss) income per share attributable to common stockholders, basic: | 12,854,967 | |||
Weighted-average shares used in computation of net (loss) income per share attributable to common stockholders, diluted: | 12,854,967 | |||
Subscriptions [Member] | ||||
Revenue | ||||
Revenue | 31,679 | 27,946 | 89,308 | |
Cost of revenue | ||||
Cost of revenue | 18,225 | 8,349 | 44,137 | |
Service [Member] | ||||
Revenue | ||||
Revenue | 56,707 | 1,291 | 143,992 | |
Cost of revenue | ||||
Cost of revenue | $ 43,600 | $ 457 | $ 114,199 |
Consolidated Statements of Rede
Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders' Equity (Deficit) - USD ($) | Total | ZeroFox, Inc. [Member] | IDX [Member] | PIPE [Member] | Series E Redeemable Convertible Preferred Stock [Member] ZeroFox, Inc. [Member] | Series D-2 Redeemable Convertible Preferred Stock [Member] ZeroFox, Inc. [Member] | Series D-1 Redeemable Convertible Preferred Stock [Member] ZeroFox, Inc. [Member] | Series D Redeemable Convertible Preferred Stock [Member] ZeroFox, Inc. [Member] | Series C-1 Redeemable Convertible Preferred Stock [Member] ZeroFox, Inc. [Member] | Series C Redeemable Convertible Preferred Stock [Member] ZeroFox, Inc. [Member] | Series B Redeemable Convertible Preferred Stock [Member] ZeroFox, Inc. [Member] | Series A Redeemable Convertible Preferred Stock [Member] ZeroFox, Inc. [Member] | Series Seed Redeemable Convertible Preferred Stock [Member] ZeroFox, Inc. [Member] | Redeemable Convertible Preferred Stock [Member] ZeroFox, Inc. [Member] | Common Stock [Member] | Common Stock [Member] ZeroFox, Inc. [Member] | Common Stock [Member] IDX [Member] | Common Stock [Member] PIPE [Member] | Common Stock [Member] L&F Class A Ordinary Shares [Member] | Common Stock [Member] L&F Class B Ordinary Shares [Member] | Additional Paid in Capital [Member] | Additional Paid in Capital [Member] ZeroFox, Inc. [Member] | Additional Paid in Capital [Member] IDX [Member] | Additional Paid in Capital [Member] PIPE [Member] | Accumulated Deficit [Member] | Accumulated Deficit [Member] ZeroFox, Inc. [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Accumulated Other Comprehensive Income (Loss) [Member] ZeroFox, Inc. [Member] |
Ending balance at Aug. 03, 2022 | $ 36,291,000 | $ 1,451,000 | $ 8,171,000 | $ 21,067,000 | $ 16,836,000 | $ 19,899,000 | $ 22,047,000 | $ 10,159,000 | $ 2,208,000 | $ 138,129,000 | ||||||||||||||||||
Ending balance (in shares) at Aug. 03, 2022 | 15,767,013 | 993,868 | 5,878,303 | 13,871,547 | 11,882,605 | 21,124,699 | 26,914,949 | 15,997,285 | 9,198,372 | 121,628,641 | ||||||||||||||||||
Ending balance at Aug. 03, 2022 | $ (23,825,000) | $ (173,551,000) | $ 10,205,000 | $ 4,839,000 | $ (34,030,000) | $ (178,225,000) | $ (165,000) | |||||||||||||||||||||
Ending balance (in shares) at Aug. 03, 2022 | 43,285,377 | 1,006,002 | 4,312,500 | |||||||||||||||||||||||||
Beginning balance at Jan. 31, 2022 | $ 33,248,000 | $ 1,451,000 | $ 8,171,000 | $ 21,067,000 | $ 13,979,000 | $ 19,899,000 | $ 22,047,000 | $ 10,159,000 | $ 2,208,000 | $ 132,229,000 | ||||||||||||||||||
Beginning balance (in shares) at Jan. 31, 2022 | 15,227,437 | 993,868 | 5,878,303 | 13,871,547 | 11,376,115 | 21,124,699 | 26,914,949 | 15,997,285 | 9,198,372 | 120,582,575 | ||||||||||||||||||
Beginning balance at Jan. 31, 2022 | (153,148,000) | 3,873,000 | (156,820,000) | (201,000) | ||||||||||||||||||||||||
Beginning balance (in shares) at Jan. 31, 2022 | 42,892,927 | |||||||||||||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||||||
Exercise of warrants | $ 3,043,000 | $ 2,857,000 | $ 5,900,000 | |||||||||||||||||||||||||
Exercise of warrants (in shares) | 539,576 | 506,490 | 1,046,066 | |||||||||||||||||||||||||
Stock-based compensation expense | 862,000 | 862,000 | ||||||||||||||||||||||||||
Exercise of options | 104,000 | 104,000 | ||||||||||||||||||||||||||
Exercise of options (in shares) | 392,450 | 392,450 | ||||||||||||||||||||||||||
Net loss | $ (21,405,000) | (21,405,000) | (21,405,000) | |||||||||||||||||||||||||
Foreign currency translation adjustment | 36,000 | 36,000 | ||||||||||||||||||||||||||
Ending balance at Aug. 03, 2022 | $ 36,291,000 | $ 1,451,000 | $ 8,171,000 | $ 21,067,000 | $ 16,836,000 | $ 19,899,000 | $ 22,047,000 | $ 10,159,000 | $ 2,208,000 | $ 138,129,000 | ||||||||||||||||||
Ending balance (in shares) at Aug. 03, 2022 | 15,767,013 | 993,868 | 5,878,303 | 13,871,547 | 11,882,605 | 21,124,699 | 26,914,949 | 15,997,285 | 9,198,372 | 121,628,641 | ||||||||||||||||||
Ending balance at Aug. 03, 2022 | (23,825,000) | (173,551,000) | 10,205,000 | 4,839,000 | (34,030,000) | $ (178,225,000) | $ (165,000) | |||||||||||||||||||||
Ending balance (in shares) at Aug. 03, 2022 | 43,285,377 | 1,006,002 | 4,312,500 | |||||||||||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||||||
Conversion | 1,000 | $ 1,000 | $ (4,312,500) | |||||||||||||||||||||||||
Conversion (in shares) | 5,318,502 | (1,006,002) | ||||||||||||||||||||||||||
Issuance of Common Stock | $ 898,232,000 | $ 304,957,000 | $ 20,000,000 | $ 8,000 | $ 3,000 | $ 898,224,000 | $ 304,954,000 | $ 20,000,000 | ||||||||||||||||||||
Issuance of Common Stock (in shares) | 82,030,308 | 27,849,942 | 2,000,000 | |||||||||||||||||||||||||
Exercise of warrants | 7,632,000 | 7,632,000 | ||||||||||||||||||||||||||
Exercise of warrants (in shares) | 784,907 | |||||||||||||||||||||||||||
Stock-based compensation expense | 2,500,000 | 2,500,000 | ||||||||||||||||||||||||||
Exercise of options | $ 122,000 | 122,000 | ||||||||||||||||||||||||||
Exercise of options (in shares) | 206,476 | 206,476 | ||||||||||||||||||||||||||
Net loss | $ (720,647,000) | (720,647,000) | ||||||||||||||||||||||||||
Foreign currency translation adjustment | (101,000) | $ (101,000) | ||||||||||||||||||||||||||
Ending balance at Jan. 31, 2023 | 488,871,000 | $ 12,000 | 1,243,637,000 | (754,677,000) | (101,000) | |||||||||||||||||||||||
Ending balance (in shares) at Jan. 31, 2023 | 118,190,135 | |||||||||||||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||||||
Stock-based compensation expense | 7,525,000 | 7,525,000 | ||||||||||||||||||||||||||
Exercise of options | $ 298,000 | 298,000 | ||||||||||||||||||||||||||
Exercise of options (in shares) | 1,003,474 | 1,003,474 | ||||||||||||||||||||||||||
Vesting of restricted stock units (in shares) | 1,635,418 | |||||||||||||||||||||||||||
Issuance of common stock to partially satisfy purchase consideration liability, shares | 3,810,108 | |||||||||||||||||||||||||||
Issuance of common stock to partially satisfy purchase consideration liability, value | $ 2,647,000 | 2,647,000 | ||||||||||||||||||||||||||
Other | 2,486,000 | 2,486,000 | ||||||||||||||||||||||||||
Net loss | (356,310,000) | (356,310,000) | ||||||||||||||||||||||||||
Foreign currency translation adjustment | (248,000) | (248,000) | ||||||||||||||||||||||||||
Ending balance at Jan. 31, 2024 | $ 145,269,000 | $ 12,000 | $ 1,256,593,000 | $ (1,110,987,000) | $ (349,000) | |||||||||||||||||||||||
Ending balance (in shares) at Jan. 31, 2024 | 124,639,135 |
Consolidated Statements of Re_2
Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders' Deficit - USD ($) $ in Thousands | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | ID Experts Holdings, Inc. and Subsidiary [Member] | ID Experts Holdings, Inc. and Subsidiary [Member] Series A-1 Redeemable Convertible Preferred Stock [Member] | ID Experts Holdings, Inc. and Subsidiary [Member] Series A-2 Redeemable Convertible Preferred Stock | ID Experts Holdings, Inc. and Subsidiary [Member] Common Stock [Member] | ID Experts Holdings, Inc. and Subsidiary [Member] Additional Paid-in Capital [Member] | ID Experts Holdings, Inc. and Subsidiary [Member] Accumulated Deficit [Member] |
Beginning balance at Dec. 31, 2021 | $ 10,000 | $ 54,902 | ||||||||
Beginning balance (in shares) at Dec. 31, 2021 | 5,882,350 | 26,069,330 | ||||||||
Beginning balance at Dec. 31, 2021 | $ (70,234) | $ 1 | $ (70,235) | |||||||
Beginning balance (in shares) at Dec. 31, 2021 | 11,671,845 | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Preferred stock issued | $ 264 | |||||||||
Preferred stock issued (in shares) | 124,994 | |||||||||
Common stock issued | 2,042 | $ 2,042 | ||||||||
Common stock issued (in shares) | 1,553,226 | |||||||||
Stock-based compensation expense | 16 | 16 | ||||||||
Net loss | (857) | (857) | ||||||||
Ending balance at Aug. 03, 2022 | $ 10,000 | $ 55,166 | ||||||||
Ending balance (in shares) at Aug. 03, 2022 | 5,882,350 | 26,194,324 | ||||||||
Ending balance at Aug. 03, 2022 | $ (23,825) | $ 10,205 | $ (34,030) | (69,033) | $ 1 | 2,058 | (71,092) | |||
Ending balance (in shares) at Aug. 03, 2022 | 13,225,071 | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Net loss | (21,405) | |||||||||
Ending balance at Aug. 03, 2022 | $ 10,000 | $ 55,166 | ||||||||
Ending balance (in shares) at Aug. 03, 2022 | 5,882,350 | 26,194,324 | ||||||||
Ending balance at Aug. 03, 2022 | (23,825) | 10,205 | (34,030) | $ (69,033) | $ 1 | $ 2,058 | $ (71,092) | |||
Ending balance (in shares) at Aug. 03, 2022 | 13,225,071 | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Stock-based compensation expense | 2,500 | 2,500 | ||||||||
Net loss | (720,647) | (720,647) | ||||||||
Ending balance at Jan. 31, 2023 | 488,871 | $ 12 | 1,243,637 | (754,677) | ||||||
Ending balance (in shares) at Jan. 31, 2023 | 118,190,135 | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Stock-based compensation expense | 7,525 | 7,525 | ||||||||
Net loss | (356,310) | (356,310) | ||||||||
Ending balance at Jan. 31, 2024 | $ 145,269 | $ 12 | $ 1,256,593 | $ (1,110,987) | ||||||
Ending balance (in shares) at Jan. 31, 2024 | 124,639,135 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | 7 Months Ended | 12 Months Ended | |
Jan. 31, 2023 | Aug. 03, 2022 | Aug. 03, 2022 | Jan. 31, 2024 | |
Cash Flows from Operating Activities: | ||||
Net loss | $ (720,647) | $ (21,405) | $ (356,310) | |
Adjustments to reconcile net loss to net cash used in operating activities: | ||||
Goodwill impairment | 698,650 | 284,240 | ||
Depreciation and amortization | 366 | 322 | 1,703 | |
Amortization of software development costs | 25 | 321 | 129 | |
Amortization of acquired intangible assets | 23,056 | 1,604 | 46,490 | |
Amortization of right-of-use assets | 526 | 1,802 | ||
Amortization of deferred debt issuance costs | 24 | 229 | 117 | |
Stock-based compensation | 2,500 | 862 | 7,525 | |
Loss on sale of asset | (4) | |||
Provision for bad debts/doubtful accounts | 32 | (7) | 118 | |
Change in fair value of warrants | (5,364) | 2,059 | 349 | |
Change in fair value of contingent consideration | (2,456) | |||
Change in fair value of sponsor earnout shares | (9,634) | (2,053) | ||
Deferred tax expense | (10,992) | (9,140) | ||
Noncash interest expense | 6,564 | 303 | 14,353 | |
Changes in operating assets and liabilities: | ||||
Accounts receivable | (3,736) | 3,643 | (6,198) | |
Deferred contract acquisition costs | (1,267) | (109) | (6,890) | |
Prepaid expenses and other assets | (187) | (1,498) | (1,992) | |
Accounts payable, accrued compensation, accrued expenses, and other current liabilities | (8,274) | (3,073) | (3,913) | |
Operating lease liabilities | (413) | (1,949) | ||
Deferred revenue | 1,365 | 2,926 | 22,038 | |
Net cash used in operating activities | (27,406) | (13,823) | (12,041) | |
Cash Flows from Investing Activities: | ||||
Proceeds from the Trust Account | 34,864 | |||
Purchases of property and equipment | (313) | (245) | (600) | |
Capitalized software | (278) | (501) | (217) | |
Net cash used in investing activities | (63,899) | (746) | (8,709) | |
Cash Flows from Financing Activities: | ||||
Proceeds from issuance of convertibles notes, net of issuance costs | 149,872 | |||
Proceeds from the PIPE | 20,000 | |||
Exercise of stock options | 122 | 104 | 298 | |
Proceeds from issuance of debt, net of issuance costs | 7,412 | 7,425 | ||
Repurchase of class A ordinary shares | (24,626) | |||
Payment of deferred underwriting fee | (6,054) | |||
Repayment of debt | (469) | (469) | (938) | |
Net cash (used in) provided by financing activities | 138,845 | 7,047 | 6,785 | |
Foreign currency translation adjustment | (101) | 54 | (219) | |
Net change in cash, cash equivalents, and restricted cash | 47,439 | (7,468) | (14,184) | |
Cash, cash equivalents, and restricted cash beginning of period | 2,906 | 10,374 | 47,649 | |
Cash, cash equivalents, and restricted cash end of period | 47,649 | 2,906 | $ 2,906 | 33,465 |
Supplemental Cash Flow Elements [Abstract] | ||||
Cash paid for interest | 625 | 2,266 | 2,021 | |
Cash paid for income taxes | 75 | 50 | 1,913 | |
Non-Cash Investing and Financing Activities: | ||||
Issuance of common stock to partially satisfy purchase consideration liability | 2,647 | |||
Accrual of purchase consideration liability in connection with business acquisition | 9,466 | |||
Exercise of warrants | (7,632) | (5,900) | ||
Issuance of warrants along with issuance of debt | 519 | 126 | ||
Convertible note issued in connection with business acquisition | 3,333 | |||
Operating lease liabilities arising from obtaining right-of-use assets | 3,895 | |||
ID Experts Holdings, Inc. and Subsidiary [Member] | ||||
Cash Flows from Operating Activities: | ||||
Net loss | (857) | |||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||
Depreciation and amortization | 46 | |||
Amortization of deferred debt issuance costs | 2 | |||
Stock-based compensation | 16 | |||
Gain on warrant exercised | (8) | |||
Provision for bad debts/doubtful accounts | (117) | |||
Change in fair value of warrants | 133 | |||
Change in fair value of debt | 589 | |||
Deferred tax expense | (1,354) | |||
Loss on sale of property and equipment | 1 | |||
Changes in operating assets and liabilities: | ||||
Accounts receivable | (1,823) | |||
Deferred contract acquisition costs | (944) | |||
Prepaid expenses and other assets | (242) | |||
Accrued compensation, accrued expenses, and other current liabilities | 1,843 | |||
Accounts payable | 262 | |||
Deferred revenue | 1,160 | |||
Net cash used in operating activities | (1,293) | |||
Cash Flows from Investing Activities: | ||||
Business acquisition, net of cash acquired | (49,803) | |||
Purchases of property and equipment | (44) | |||
Net cash used in investing activities | (44) | |||
Cash Flows from Financing Activities: | ||||
Exercise of stock options | 191 | |||
Repayment of debt | (556) | |||
Net cash (used in) provided by financing activities | (365) | |||
Net change in cash, cash equivalents, and restricted cash | (1,702) | |||
Cash, cash equivalents, and restricted cash beginning of period | 16,284 | 17,986 | ||
Cash, cash equivalents, and restricted cash end of period | $ 16,284 | 16,284 | ||
Supplemental Cash Flow Elements [Abstract] | ||||
Cash paid for interest | 307 | |||
Cash paid for income taxes | 107 | |||
Non-Cash Investing and Financing Activities: | ||||
Increase in redeemable convertible preferred stock | (264) | |||
Decrease in accrued expense | 2,122 | |||
Increase in retained earnings | (8) | |||
Increase in additional paid in capital | $ (1,850) | |||
ZeroFox | ||||
Cash Flows from Investing Activities: | ||||
Business acquisition, net of cash acquired | $ (48,369) | |||
LookingGlass [Member] | ||||
Cash Flows from Investing Activities: | ||||
Business acquisition, net of cash acquired | $ (7,892) |
Consolidated Statements of Ca_2
Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Thousands | Jan. 31, 2024 | Jan. 31, 2023 | Aug. 03, 2022 |
Statement of Cash Flows [Abstract] | |||
Cash and cash equivalents | $ 33,149 | $ 47,549 | $ 2,806 |
Restricted cash included in other assets | 316 | 100 | 100 |
Total cash, cash equivalents, and restricted cash shown in the consolidated statements of cash flows | $ 33,465 | $ 47,649 | $ 2,906 |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | |
Jan. 31, 2023 | Aug. 03, 2022 | Jan. 31, 2024 | |
Pay vs Performance Disclosure | |||
Net Income (Loss) | $ (720,647) | $ (21,405) | $ (356,310) |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Jan. 31, 2024 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Organization and Description of
Organization and Description of Business | 7 Months Ended | 12 Months Ended |
Aug. 03, 2022 | Jan. 31, 2024 | |
Organization and Description of Business [Line Items] | ||
Organization and Description of Business | 1: Organization and Description of Business ZeroFox Holdings, Inc. (ZeroFox Holdings) is a holding company incorporated in the state of Delaware. ZeroFox Holdings was formerly known as L&F Acquisition Corp. (L&F) and was a blank check, Cayman Islands exempted company, incorporated on August 20, 2020. ZeroFox Holdings conducts its business through its wholly-owned, consolidated subsidiaries, primarily ZeroFox, Inc. and Identity Theft Guard Solutions, Inc. The Company provides digital risk protection services and safeguards modern organizations from dynamic security risks across social, mobile, surface, deep web, dark web, email, and collaboration platforms. Using diverse data sources and artificial intelligence-based analysis, the ZeroFox Platform identifies and remediates targeted phishing attacks, credential compromise, data exfiltration, brand hijacking, executive and location threats, and more. The patented ZeroFox Software as a Service (“SaaS”) technology processes and protects electronic posts, messages, and accounts daily across the social and digital landscape, spanning social media platforms, mobile app stores, the deep web, dark web, domains, and more. The Company offers its services on a subscription basis. On August 3, 2022 (the "Closing Date"), L&F, ZeroFox, Inc., and ID Experts Holdings, Inc. ("IDX"), consummated the business combination (the Business Combination) as contemplated by the Business Combination Agreement, dated as of December 17, 2021. In connection with the finalization of the Business Combination, L&F changed its name to ZeroFox Holdings, Inc. and changed its jurisdiction of incorporation from the Cayman Islands to the state of Delaware. The Company changed its fiscal year end to January 31. On April 21, 2023 , the Company completed its acquisition of Lookingglass Cyber Solutions, Inc. (LookingGlass), a leader in external attack surface management and global threat intelligence. The Company's Common Stock is listed on The Nasdaq Global Market under the ticker symbol "ZFOX" and its warrants are listed on The Nasdaq Capital Market under the ticker symbol "ZFOXW". The Company provides an external cybersecurity platform and related services that protect organizations from threats outside the traditional corporate perimeter. These threats impact organizations, their brands, digital assets, and people, and include targeted phishing attacks, account takeovers, credential theft, data leakage, domain spoofing, and impersonations. The Company’s cloud-native platform combines protection, intelligence, adversary disruption, and response services into an integrated solution (our Platform). The Company provides data breach response services and associated identity and privacy protection services, including prevention, detection, forensic services, notification, and recovery assistance. On February 6, 2024, the Company entered into a definitive agreement to be acquired by Haveli Investments L.P., a technology-focused private equity firm. Upon the closing of the transaction, the Company’s Common Stock will be delisted from The Nasdaq Stock Market LLC and deregistered under the Securities Exchange Act of 1934, as amended. The announced transaction is discussed further in Note 18. Segment Information Operating segments are defined as components of an enterprise for which discrete financial information is made available for evaluation by the chief operating decision maker (CODM) in making decisions regarding resource allocation and assessing performance. The CODM is the Company’s chief executive officer. The CODM views the Company’s operations and manages its activities as a single operating segment. The Company’s assets are primarily located in the United States. | |
ID Experts Holdings, Inc. and Subsidiary [Member] | ||
Organization and Description of Business [Line Items] | ||
Organization and Description of Business | 1: Organization and Description of Business ID Experts Holdings, Inc., and subsidiary (IDX) believes it has a leading position in the United States by revenue as a provider of data breach response services, and associated identity and privacy protection services, to both government and commercial entities. IDX’s data breach solutions include prevention, detection, forensic services, notification, and recovery assistance. IDX’s membership subscriptions include credit and non-credit monitoring, prevention tools, and unlimited recovery assistance. ID Experts Holdings, Inc. was incorporated in the State of Delaware in 2016 at which time Identity Theft Guard Solutions, Inc. (ITGS), the primary operating entity, became the wholly-owned subsidiary of ID Experts Holdings, Inc. in 2016 during its recapitalization. IDX serves clients throughout the United States of America and is located in Portland, Oregon. On December 15, 2021, IDX’s Board of Directors approved a business combination agreement, which was entered into as of December 17, 2021, and announced publicly on December 20, 2021. The business combination agreement details a transaction where IDX was to be merged with ZeroFox, Inc. (ZeroFox) and L&F Acquisition Corp. (L&F), a special purpose acquisition corporation (SPAC) and publicly traded company. IDX and ZeroFox are both the legal and accounting acquirees and L&F is the legal and accounting acquiror. On the date of the Business Combination, L&F changed its name to ZeroFox Holdings, Inc. (ZeroFox Holdings). See Note 2b for additional information. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 7 Months Ended | 12 Months Ended |
Aug. 03, 2022 | Jan. 31, 2024 | |
Accounting Policies [Line Items] | ||
Summary of Significant Accounting Policies | 2: Summary of Significant Accounting Policies Basis of Presentation As result of the Business Combination, the Company evaluated if L&F, ZeroFox, or IDX is the predecessor for accounting purposes. The Company considered the application of Rule 405 of Regulation C, the interpretative guidance of the staff of the United States Securities and Exchange Commission ("SEC"), including factors for the Registrant to consider in determining the predecessor, and analyzed the following: (1) the order in which the entities were acquired, (2) the size of the entities, (3) the fair value of the entities, (4) the historical and ongoing management structure, and (5) how management discusses the Company's business in our Form 10-Q and Form 10-K filings. In considering the foregoing principles of predecessor determination in light of the Company's specific facts and circumstances, management determined that ZeroFox, Inc. is the predecessor for accounting purposes. The financial statement presentation includes the financial statements of ZeroFox, Inc. as “Predecessor” for periods prior to the Closing Date and the financial statements of the Company as “Successor” for the period after the Closing Date, including the consolidation of ZeroFox, Inc. and IDX. The predecessor financial statements for IDX are included separately within this report. Refer to Note 5 for further discussion on the Business Combination. The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("US GAAP") as set forth by the Financial Accounting Standards Board ("FASB"). References to US GAAP issued by the FASB in these notes to the consolidated financial statements are to the FASB Accounting Standards Codifications ("ASC"). Emerging Growth Company Status The Company is an “emerging growth company,” (EGC) as defined in the Jumpstart Our Business Startups Act, (the JOBS Act), and may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not EGCs. The Company may take advantage of these exemptions until it is no longer an EGC under the JOBS Act and has elected to use the extended transition period for complying with new or revised accounting standards. As a result of this election, the Company’s financial statements may not be comparable to companies that comply with public company FASB standards’ effective dates. The JOBS Act exempts EGCs from being required to comply with new or revised financial accounting standards until private companies are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period, which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an EGC, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company's financial statements with certain other public companies difficult or impossible because of the potential differences in accounting standards used. Principles of Consolidation The accompanying consolidated financial statements include all the accounts of the Company. All intercompany balances and transactions have been eliminated in consolidation. Use of Estimates The preparation of the accompanying consolidated financial statements in conformity with US GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities within these consolidated financial statements. Significant estimates and judgments include but are not limited to: (1) revenue recognition, (2) capitalization of internally developed software costs, (3) fair value of stock-based compensation, (4) valuation of assets acquired and liabilities assumed in business combinations, (5) useful lives of contract acquisition costs and intangible assets, (6) evaluation of goodwill and long lived assets for impairment, (7) valuation of warrants and the Sponsor Earnout Shares (see Note 11), (8) fair value of the purchase consideration liability (see Note 11), and (9) valuation allowances associated with deferred tax assets. The Company bases its estimates and assumptions on historical experience, expectations, forecasts, and on various other factors that are believed to be reasonable under the circumstances. Due to the inherent uncertainty involved in making estimates, actual results reported in future periods may differ from results of prior periods. Cash and Cash Equivalents Cash and cash equivalents consist of business checking accounts and money market funds. The Company considers all highly liquid investments with original maturities of three months or less at the time of purchase to be cash equivalents. Cash and cash equivalents are carried at cost, which, due to their short-term nature, approximates fair value. Restricted Cash Cash that is unavailable for general operating purposes is classified as restricted cash and is included with other assets on the Consolidated Balance Sheets. Restricted cash represents amounts pledged as collateral for credit card accounts as contractually required by the Company’s lenders. Revenue Recognition The Company derives its revenue from providing its customers with subscription access to the Company’s External Cybersecurity Platform (subscription revenue) and services (services revenue). In accordance with ASC 606, Revenue from Contracts with Customers , revenue is recognized when a customer obtains control of promised services. The amount of revenue recognized reflects the consideration that the Company expects to be entitled to receive in exchange for those services. To achieve the core principle of this standard, the Company applies the following five steps: a) Identify Contracts with Customers. The Company considers the terms and conditions of contracts and its customary business practices in identifying contracts with customers in accordance with ASC 606. The Company determines it has a contract with a customer when the contract is approved, the Company can identify each party’s rights regarding the services to be transferred, the Company can identify the payment terms for the services, and the Company has determined that the customer has the ability and intent to pay and the contract has commercial substance. The Company applies 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. b) 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 the Company, and that are distinct in the context of the contract, whereby the transfer of the services is separately identifiable from other promises in the contract. c) Determine the Transaction Price. The transaction price is determined based on the consideration to which the Company expects to be entitled in exchange for transferring services to the customer. The Company’s typical pricing for its subscriptions and professional services does not result in contracts with significant variable consideration. The Company’s arrangements do not contain significant financing components. d) 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 the stand-alone selling price (SSP) of each performance obligation, using the relative selling price method of allocation. e) Recognize Revenue When or As Performance Obligations are Satisfied. Revenue is recognized at the time the related performance obligation is satisfied by transferring the promised service to a customer. For our performance obligations, the Company transfers control over time, as the customer simultaneously receives and consumes the benefits provided by the Company’s service. Subscription Revenue The Company generates subscription revenue from its External Cybersecurity Platform. Subscription revenue from the External Cybersecurity Platform includes the sale of subscriptions to access the platform and related support and intelligence services. Subscription revenue is driven by the number of assets protected and the desired level of service. These arrangements do not provide the customer with the right to take possession of the Company’s software operating on its cloud platform at any time. These arrangements represent a combined, stand-ready performance obligation to provide access to the software together with related support and intelligence services. Customers are granted continuous access to the External Cybersecurity Platform over the contractual period. Revenue is recognized on a ratable basis over the contract term beginning on the date that the Company’s service is made available to the customer. The Company’s subscription contracts generally have terms of one to three years , which are primarily billed in advance and are non-cancelable. Services Revenue The Company generates services revenue by executing engagements for data breach response and intelligence services. The Company generates breach response revenue primarily from various combinations of notification, project management, communication services, and ongoing identity protection services. Performance periods generally range from one to three years . The Company’s breach response contracts are structured as either fixed price or variable price. In fixed price contracts, the Company charges a fixed total price or fixed individual price for the total combination of services. For variable price breach services contracts, the Company charges the breach communications component, which includes notifications and call center, at a fixed total fee, and the Company charges the ongoing identity protection services as incurred using a fixed price per enrollment. The Company generally bills for fixed fees at the time the contract is executed. For larger contracts, the Company bills 50% at the time the contract is executed and the remaining 50% within 30 days of contract execution. For variable price breach contracts, the Company invoices for identity protection services monthly based on actual enrollments. The Company offers several types of cybersecurity services, including investigative, security advisory and training services. The Company often sells a suite of cybersecurity services along with subscriptions to its External Cybersecurity Platform. All of the Company’s advisory and training services are considered distinct performance obligations from the External Cybersecurity Platform subscriptions services within the context of the Company’s contracts. Revenue is recognized over time as the customers benefit from these services as they are performed or as control of the promised services is transferred to the customer. These contracts are most often fixed fee arrangements and less frequently arrangements that are billed at hourly rates. These contracts normally have terms of one year or less. Contracts with Multiple Performance Obligations The majority of the Company’s contracts with customers contain multiple performance obligations. For these contracts, the Company accounts for individual performance obligations separately . The transaction price is allocated to the separate performance obligations based on the SSP of each performance obligation using the relative selling price method of allocation. Revenue from Reseller Arrangements The Company enters into arrangements with third parties that allow those parties to resell the Company’s services to end users. The partners negotiate pricing with the end customer and the Company does not have visibility into the price paid by the end customer. For these arrangements, the Company recognizes revenue at the amount charged to the reseller and does not reflect any mark-up to the end user. Government Contracts The Company evaluates arrangements with governmental entities containing fiscal funding or termination for convenience provisions, when such provisions are required by law, to determine the probability of possible cancellation. The Company considers multiple factors, including the history with the customer in similar transactions and budgeting and approval processes undertaken by the governmental entity. If the Company determines upon execution of these arrangements that the likelihood of cancellation is remote, it then recognizes revenue for such arrangements once all relevant criteria have been met. If such a determination cannot be made, revenue is recognized upon the earlier of cash receipt or approval of the applicable funding provision by the governmental entity for such arrangements. Timing of Revenue Recognition The table below provides revenue earned by timing of revenue for the year ended January 31, 2024, the Successor Period, and the Predecessor Period (in thousands). Successor Predecessor Revenue Recognition Timing Year ended January 31, 2024 August 4, 2022 to February 1, 2022 to Over time $ 185,345 $ 79,025 $ 27,946 Point in time 47,955 9,361 1,291 Total $ 233,300 $ 88,386 $ 29,237 Cost of Revenue Cost of revenue consists primarily of wages and benefits for software operations, service delivery, and customer support personnel. Cost of revenue also includes all direct costs of maintenance and hosting, as well as the amortization of costs capitalized for the development of the Company’s enterprise cloud platform and acquired technology, and allocated overhead, primarily shared IT expenses. Research and Development Research and development costs are expensed in the period incurred and consist primarily of payroll and personnel costs, consulting costs, software and web services, and allocated overhead, primarily shared IT expenses. General and Administrative General and administrative costs are expensed in the period incurred and consist primarily of salaries and other related costs, including stock-based compensation, for personnel in the Company’s executive and finance functions. General and administrative costs also include professional fees for legal, accounting, auditing, tax and consulting services; travel expenses; and facility-related expenses, which include costs for rent and maintenance of facilities and other operating costs. Sales and Marketing Selling and marketing expenses consist primarily of salaries, commissions, stock-based compensation, benefits and bonuses for personnel associated with sales and marketing activities, as well as costs related to advertising, product management, promotional materials, public relations, amortization of acquired customer relationships, other sales and marketing programs, and allocated overhead, primarily shared IT expenses. Advertising Advertising costs, which are expensed and included in sales and marketing expense in the period incurred were $ 1.3 million, $ 0.4 million, and $ 0.5 million during the year ended January 31, 2024, the Successor Period, and the Predecessor Period , respectively. Income Taxes In accordance with ASC 740, Income Taxes, income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the consolidated financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those assets and liabilities are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. The measurement of a deferred tax asset is reduced, if necessary, by a valuation allowance if it is more likely than not that some portion or all of the deferred tax asset will not be realized. ASC 740 prescribes a recognition threshold and a measurement attribute for the consolidated financial statement recognition and measurement of tax positions taken, or expected to be taken, in a tax return, as well as guidance on derecognition, classification, interest, penalties, and consolidated financial statement reporting disclosures. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The amount recognized is measured as the largest amount of benefit that is greater than 50 % likely of being realized upon ultimate settlement. The Company recognizes interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense. The Company remains subject to examination by U.S. federal and various state tax authorities for the fisca l years 2020 thr ough 2023, and may be further extended upon the utilization of NOL carryforwards. Stock-Based Compensation The Company accounts for stock-based compensation in accordance with ASC 718 , Compensation — Stock Compensation . ASC 718 requires that the cost of awards of equity instruments offered in exchange for employee services, including employee stock options and restricted stock awards, be measured based on the grant-date fair value of the award. The Company adopted FASB ASU No. 2016-09, Compensation — Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting , on February 1, 2019. This ASU involves several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification in the consolidated statements of cash flows. The adoption did not have a material impact on the consolidated financial statements of the Company. The Company determines the fair value of options granted using the Black-Scholes-Merton option-pricing model (“Black-Scholes model”) and recognizes the cost over the period during which an employee is required to provide service in exchange for the award, generally the vesting period, net of estimated forfeitures. The fair value of restricted stock awards is based on the estimated price of the Company’s common stock on the date of grant and is recognized as expense over the requisite service period of the awards, net of estimated forfeitures. Prior to the Company's stock being publicly traded, the Company was required to estimate the fair value of common stock. The Board of Directors considered numerous objective and subjective factors to determine the fair value of the Company’s common stock at each meeting in which awards are approved. The factors considered include, but are not limited to: (i) the results of contemporaneous independent third-party valuations of the Company’s common stock; (ii) the prices, rights, preferences, and privileges of the Company’s Convertible Redeemable Preferred Stock relative to those of its common stock; (iii) the lack of marketability of the Company’s common stock; (iv) actual operating and financial results; (v) current business conditions and projections; (vi) the likelihood of achieving a liquidity event, such as an initial public offering or sale of the Company, given prevailing market conditions; and (vii) precedent transactions involving the Company’s shares. Leases The Company adopted ASC Topic 842, Leases for the fiscal year 2023. Refer to "Standards Issued and Adopted " in this footnote for more information. The Company determines if an arrangement contains a lease and the classification of that lease, if applicable, at inception. For contracts with lease and non-lease components, we have elected to not allocate the contract consideration, and account for the lease and non-lease components as a single lease component. Operating leases are included in operating lease right-of-use (ROU) assets, operating lease liabilities and operating lease liabilities (net of current portion) in our Consolidated Balance Sheets. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments under the lease. Operating lease ROU assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. The implicit rate within our operating leases is generally not determinable and we use our incremental borrowing rate at the lease commencement date to determine the present value of lease payments. The determination of our incremental borrowing rate requires judgment. The Company determines our incremental borrowing rate for each lease using our current borrowing rate, adjusted for various factors including level of collateralization and term to align with the terms of the lease. The operating lease ROU asset also includes any lease prepayments, offset by lease incentives. Certain of our leases include options to extend or terminate the lease. An option to extend the lease is considered in connection with determining the ROU asset and lease liability when it is reasonably certain we will exercise that option. An option to terminate is considered in the determination of the lease term unless it is reasonably certain we will not exercise the option. Lease expense for lease payments is recognized on a straight-line basis over the term of the lease. Business Combinations The Company accounted for the Business Combination using the acquisition method pursuant to ASC 805, Business Combinations . The Company determined that ZeroFox, Inc. is a Variable Interest Entity (VIE) as its equity at risk is not sufficient to fund its expected future cash flow needs including funding future projected losses and servicing existing debt obligations. The Company holds a variable interest in ZeroFox, Inc. as it owns 100 % of the equity of ZeroFox, Inc. following completion of the Business Combination. The Company is considered the primary beneficiary of ZeroFox, Inc. as its ownership provides power to direct the activities that most significantly impact ZeroFox, Inc.'s performance and the Company has the obligation to absorb the losses and/or receive the benefits of ZeroFox, Inc., which potentially could be significant. Accordingly, the Company is both the legal and accounting acquirer of ZeroFox, Inc. The Company identified itself as both the legal and accounting acquirer of IDX. As the Company is identified as the accounting acquirer for both ZeroFox, Inc. and IDX, both mergers are considered "forward mergers". Under the "forward merger" approach of the acquisition method of accounting, the Company allocated the consideration transferred to effect the mergers to the assets acquired and liabilities assumed based on their estimated acquisition-date fair values. The Company recognized the excess of consideration transferred over the fair values of assets acquired and liabilities assumed as goodwill. The Company expensed all transaction related costs of the Business Combination. Significant estimates in valuing certain identifiable assets include, but are not limited to, the selection of valuation methodologies, future expected cash flows, discount rates, and useful lives. Management’s 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. Acquisition costs, such as legal and consulting fees, are expensed as incurred and are included in general and administrative expenses in the consolidated statements of comprehensive loss. During the measurement period, which is up to one year from the acquisition date, the Company may record adjustments to the assets acquired and liabilities assumed, with the corresponding offset to goodwill. Upon the conclusion of the measurement period, any subsequent adjustments are recorded in the consolidated statements of comprehensive loss. See Note 5 for additional information regarding the Business Combination. Goodwill and Intangible Assets Goodwill represents the excess of the purchase price over the fair value of identifiable assets acquired and liabilities assumed when a business is acquired. The valuation of intangible assets and goodwill involves the use of the Company's estimates and assumptions and can have a significant impact on future operating results. The Company initially records its intangible assets at fair value. Intangible assets with finite lives are amortized over their estimated useful lives while goodwill is not amortized but is evaluated for impairment at least annually. Goodwill is evaluated for impairment beginning on November 1 of each year or when an assessment of qualitative factors indicates an impairment may have occurred. The quantitative assessment includes an analysis that compares the fair value of a reporting unit to its carrying value including goodwill recorded by the reporting unit. The Company has a single reporting unit. Accordingly, the impairment assessment for goodwill is performed at the enterprise level. Goodwill is reviewed for possible impairment between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of the reporting unit below its carrying value. The Company initially assesses qualitative factors to determine if it is necessary to perform the goodwill impairment review. Goodwill is reviewed for impairment if, based on an assessment of the qualitative factors, it is determined that it is more likely than not that the fair value of the reporting unit is less than its carrying value, or the Company decides to bypass the qualitative assessment. The Company uses a combination of methods to estimate the fair value of its reporting unit including the discounted cash flow, guideline public company, and merger and acquisitions methods. These valuation approaches consider a number of factors that include, but are not limited to, prospective financial information, growth rates, terminal value, discount rates, and comparable multiples from publicly traded companies and merger transactions in the Company's industry. Use of these factors requires the Company to make certain assumptions and estimates regarding industry economic factors and future profitability of its business. Additionally, the Company considers income tax effects from any tax-deductible goodwill (if applicable) on the carrying amount of the reporting unit when measuring the goodwill impairment loss. It is possible that future changes in such circumstances, or in the variables associated with the judgments, assumptions, and estimates used in assessing the fair value of the reporting unit would require the Company to record a non-cash impairment charge. The Company considered qualitative factors that would indicate if the fair value of the Company's single reporting unit had declined below its carrying value, including the decline in the price of the Company's Common Stock, market conditions, and macroeconomic factors. Based on this qualitative analysis, the Company concluded that interim tests of goodwill impairment were required. The Company recorded impairment cha rges totaling $ 284.2 million during the year ended January 31, 2024, and $ 698.7 million during the Successor Period. The Company performed an annual quantitative assessment of the fair value of the Company's single reporting unit and determined its fair value to be $ 572.7 million as of October 31, 2023. As the carrying value of the reporting unit was $ 644.8 million prior to the recognition of the impairment charge, which was above the estimated fair value of the reporting unit, the Company recorded a goodwill impairment charge $ 72.1 million. The remaining $ 212.1 million was recorded as part of the interim test of goodwill as of January 31, 2024 based on the fair value implied by the Haveli Merger Agreement. The Company's estimate of the fair value of its single reporting unit of $ 348.1 million as of January 31, 2024, was below the carrying value of the reporting unit of $ 560.2 million. Impairment of Long-Lived Assets Long-lived assets, including intangible assets with finite lives, are reviewed for impairment when events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. Recoverability of the assets is measured by a comparison of the carrying amount of an asset or asset group to the future undiscounted cash flows expected to be generated by the asset or asset group. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the asset or asset group. As of January 31, 2024, management does not believe any long-lived assets are impaired and has not identified any assets as being held for disposal. Warrant Liabilities The Company evaluates all of its financial instruments, including issued stock purchase warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives, pursuant to ASC 480, Distinguishing Liabilities from Equity and FASB ASC 815, Derivatives and Hedging . The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in the ASC 480 and ASC 815. The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, whether the warrants meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s own Common Stock. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding. For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded at their initial fair value on the date of issuance, and each balance sheet date thereafter. The Company recognizes changes in the estimated fair value of the warrants as a non-cash gain or loss on the Consolidated Statement of Comprehensive Loss. The Company assessed both Public and Private Warrants and determined both met the criteria for liability treatment. Sponsor Earnout Shares The Company analyzed the terms of the Sponsor Earnout Shares (see Note 11) and determined they are within the scope of ASC 815. The Company determined that the Sponsor Earnout Shares do not meet the requirements to be recognized as an equity instrument as the Company could not conclude the Sponsor Earnout Shares are indexed to the Company's own equity. Therefore, the Company recognizes the Sponsor Earnout Shares as a liability recorded at fair value. The Sponsor Earnout Shares are not considered outstanding for accounting purposes since they are considered contingently issuable and are therefore, excluded from the calculation of basic earnings per share. The Company analyzed the terms of the Sponsor Earnout Shares to determine if they meet the definition of "participating securities", which would require the two-class method of EPS. The holders of the Sponsor Earnout Shares are not entitled to nonforfeitable rights to dividends and as such, the Sponsor Earnout Shares do not meet the definition of "participating securities". Fair Value of Financial Instruments ASC | |
ID Experts Holdings, Inc. and Subsidiary [Member] | ||
Accounting Policies [Line Items] | ||
Summary of Significant Accounting Policies | 2: Summary of Significant Accounting Policies a. Basis of Presentation The consolidated financial statements have been prepared in conformity with generally accepted accounting principles in the United States of America (US GAAP) set forth by the Financial Accounting Standards Board (FASB). References to U.S. GAAP issued by the FASB in these notes to the consolidated financial statements are to the FASB Accounting Standards Codification (ASC). IDX presented financial statements from the beginning of the year to the acquisition date of August 3, 2022. b. Emerging Growth Company Status The Company is an “emerging growth company” (EGC), as defined in the Jumpstart Our Business Startups Act (the JOBS Act), and may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not EGCs. The Company may take advantage of these exemptions until it is no longer an EGC under Section 107 of the JOBS Act and has elected to use the extended transition period for complying with new or revised accounting standards. As a result of this election, the Company’s financial statements may not be comparable to companies that comply with public company FASB standards’ effective dates. IDX merged with L&F on August 3, 2022. Refer to Note 1 for more information regarding the Business Combination. The surviving company, ZeroFox Holdings, will remain an emerging growth company until the earliest of (i) the last day of the surviving company’s first fiscal year following the fifth anniversary of the completion of the L&F’s initial public offering, (ii) the last day of the fiscal year in which ZeroFox Holdings has total annual gross revenue of at least $ 1.235 billion, (iii) the last day of the fiscal year in which ZeroFox Holdings is deemed to be a large accelerated filer, which means the market value of ZeroFox Holding’s common stock that is held by non-affiliates exceeds $ 700.0 million as of the prior July 31 or (iv) the date on which ZeroFox Holdings has issued more than $ 1.0 billion in non-convertible debt securities during the prior three-year period. c. Principles of Consolidation The accompanying consolidated financial statements include all the accounts of IDX. All intercompany balances and transactions have been eliminated in consolidation. d. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires that management make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the amounts of revenues and expenses reported during the period. Such estimates include assumptions used in the allocation of revenue, long-lived assets, liabilities, depreciable lives of assets, stock-based compensation, and deferred income taxes. Actual results could differ from those estimates, and such differences may be material to the consolidated financial statements. e. Cash and Cash Equivalents Cash and cash equivalents consist of business checking accounts. The Company considers all highly liquid investments with an original maturity of three months or less at the time of purchase to be cash equivalents. The Company generally places its cash and cash equivalents with major financial institutions deemed to be of high-credit-quality in order to limit its credit exposure. The Company maintains its cash accounts with financial institutions where, at times, deposits exceed federal insurance limits. Cash and cash equivalents are carried at cost, which due to their short-term nature, approximate fair value. f. Revenue Recognition In accordance with ASC 606, revenue is recognized when a customer obtains control of promised products or services. The amount of revenue recognized reflects the consideration that the Company expects to be entitled to receive in exchange for those products or services. To achieve the core principle of this standard, the Company applies the following five steps: a) Identify Contracts with Customers, b) Identify the Performance Obligations in the Contract, c) Determine the Transaction Price, d) Allocate the Transaction Price to Performance Obligations in the Contract, and e) Recognize Revenue When or As Performance Obligations are Satisfied. For arrangements with multiple performance obligations, the Company allocates total consideration to each performance obligation on a relative fair value basis based on management’s estimate of stand-alone selling price (SSP). The following table illustrates the timing of the Company’s revenue recognition: January 1, 2022, to August 3, 2022 Breach - point in time 12.6 % Breach - over time 83.4 % Membership services - over time 4.0 % As discussed in Note 3, all revenue was recognized over time prior to the adoption of ASC 606. Breach Services The Company’s breach services revenue consists of contracts with various combinations of notification, project management, communication services, and ongoing identity protection services. Performance periods generally range from one to three years . Payment terms are generally between thirty and sixty days. Contracts generally do not contain significant financing components. The pricing for the Company’s breach services contracts is structured as either fixed price or variable price. In fixed price contracts, a fixed total price or fixed per-impacted-individual price is charged for the total combination of services. For variable price breach services contracts, the breach communications component, which includes notifications and call center, is charged at a fixed total fee and ongoing identity protection services are charged as incurred using a fixed price per enrollment. Fixed fees are generally billed at the time the statement of work is executed and are due upon receipt. Large, fixed-fee contracts are typically billed 50% upfront and due upon receipt with the remaining 50% invoiced 30 days later with net 30 terms. For variable price contracts the charges for identity protection services are billed monthly for the prior month and are due net 30. Membership Services The Company provides membership services through its employer groups and strategic partners as well as directly to end-users through its website. Membership services consist of multiple, bundled identity and privacy product offerings and provide members with ongoing identity protection services. For membership services, revenue is recognized ratably over the service period. Performance periods are generally one year . Payments from employer groups and strategic partners are generally collected monthly. Payments from end-users are collected up front. Provisions for estimated losses on uncompleted contracts are made in the period in which such losses are determined. No losses on uncompleted contracts were recognized for the period July 1, 2022, to August 3, 2022, and the period January 1, 2022, to August 3, 2022. Significant Judgments Significant judgments and estimates are required under ASC 606. Due to the complexity of certain contracts, the actual revenue recognition treatment required under ASC 606 for the Company’s arrangements may be dependent on contract-specific terms and may vary in some instances. The Company’s contracts with customers often include promises to transfer multiple services including project management services, notification services, call center services, and identity protection services. Determining whether services are distinct performance obligations that should be accounted for separately requires significant judgment. The Company is required to estimate the total consideration expected to be received from contracts with customers, including any variable consideration. Once the estimated transaction price is established, amounts are allocated to performance obligations on a relative SSP basis. The Company’s breach business derives revenue from two main performance obligations: (i) notification and (ii) combined call center and monitoring services, described further in Note 3. At contract inception, the Company assesses the products and services promised in the contract to identify each performance obligation and evaluates whether the performance obligations are capable of being distinct and are distinct within the context of the contract. Performance obligations that are not both capable of being distinct and distinct within the context of the contract are combined and treated as a single performance obligation in determining the allocation and recognition of revenue. Determining whether products and services are considered distinct performance obligations requires significant judgment. In determining whether products and services are considered distinct performance obligations, the Company assesses whether the customer can benefit from the products and services on their own or together with other readily available resources and whether our promise to transfer the product or service to the customer is separately identifiable from other promises in the contract. Judgment is required to determine the SSP for each distinct performance obligation. The Company rarely sells its individual breach services on a standalone basis and accordingly, the Company is required to estimate the range of SSPs for each performance obligation. In instances where the SSP is not directly observable because the Company does not sell the service separately, the Company reviews information that includes historical discounting practices, market conditions, cost-plus analyses, and other observable inputs to determine an appropriate SSP. The Company typically has more than one SSP for individual performance obligations due to the stratification of those items by classes of customers, size of breach, and other circumstances. In these instances, the Company may use other available information such as service inclusions or exclusions, customizations to notifications, or varying lengths of call center or identity protection services in determining the SSP. If a group of agreements are so closely related to each other that they are in effect part of a single arrangement, such agreements are deemed to be one arrangement for revenue recognition purposes. The Company exercises judgment to evaluate the relevant facts and circumstances in determining whether the separate agreements should be accounted for separately or as in substance, a single arrangement. The Company’s judgments about whether a group of contracts comprises a single arrangement can affect the allocation of consideration to the distinct performance obligations, which could have an effect on results of the Company’s operations. The Company has not experienced significant refunds to customers. The Company’s estimates related to revenue recognition may require significant judgment and the change in these estimates could have an effect on the Company’s results of operations during the periods involved. Contract Balances The timing of revenue recognition may differ from the timing of invoicing to customers and these timing differences result in receivables, contract assets, or contract liabilities (deferred revenue) on the Consolidated Balance Sheets. The Company records a contract asset when revenue is recognized prior to invoicing and records a deferred revenue liability when revenue is expected to be recognized after invoicing. For the Company’s breach services agreements, customers are typically invoiced at the beginning of the arrangement for the entire contract amount. When the breach agreement includes variable components related to as-incurred identity protection services, customers are invoiced monthly for the duration of the enrollment or call center period. Unbilled accounts receivable, which consists of services billed one month in arrears, was $ 7.8 million as of August 3, 2022. These unbilled amounts are included in accounts receivable as the Company has the unconditional right to receive this consideration. Contract assets are presented as other receivables within the Consolidated Balance Sheets and primarily relate to the Company’s rights to consideration for work completed but not billed on service contracts. Contract assets are transferred to receivables when the Company invoices the customer. Contract liabilities are presented as deferred revenue and relate to payments received for services that are yet to be recognized in revenue. During the period January 1, 2022, to August 3, 2022, the Company recognized $ 5.1 million of revenue that was included in deferred revenue at the end of the preceding year. All other deferred revenue activity is due to the timing of invoices in relation to the timing of revenue, as described above. The Company expects to recognize as revenue approximately 56 % of its August 3, 2022 , deferred revenue balance in the remainder of 2022, 29 % in the January 1, 2023 , to August 3, 2023, and the remainder thereafter. In instances where the timing of revenue recognition differs from the timing of invoicing, the Company determined that its contracts do not include a significant financing component. The primary purpose of invoicing terms is to provide customers with simplified and predictable ways of purchasing the Company's services and not to facilitate financing arrangements. Government Contracts The Company evaluates arrangements with governmental entities containing fiscal funding or termination for convenience provisions, when such provisions are required by law, to determine the probability of possible cancellation. The Company considers multiple factors including the history with the customer in similar transactions and the budgeting and approval processes undertaken by the governmental entity. If the Company determines upon execution of these arrangements that the likelihood of cancellation is remote, it then recognizes revenue for such arrangements once all relevant criteria have been met. If such a determination cannot be made, revenue is recognized upon the earlier of cash receipt or approval of the applicable funding provision by the governmental entity for such arrangements. g. Contract Costs The Company capitalizes costs to obtain a contract or fulfill a contract. These costs are recorded as deferred contract acquisitions costs on the Consolidated Balance Sheets. Costs to obtain a contract for a new customer are amortized on a straight-line basis over the estimated period of benefit. The Company determined the estimated period of benefit by taking into consideration the contractual term. The Company periodically reviews the carrying amount of the capitalized contract costs to determine whether events or changes in circumstances have occurred that could affect the period of benefit. Amortization expense associated with costs to fulfill a contract is recorded to cost of services on the Consolidated Statements of Income. Amortization expense associated with costs to obtain a contract (sales commissions) is recorded to sales and marketing expense on the Consolidated Statements of Income. h. Cost of Services Cost of services consists of fees to outsourced service providers for credit monitoring, call center operation, notification mailing, insurance, and other miscellaneous services and internal labor costs. Costs incurred for breach service contracts represent fulfillment costs. These costs are deferred within capitalized contract costs and recognized in relation to revenue recorded over the combined service and membership terms. The remainder of cost of services are expensed as incurred. Relevant depreciation and amortization are included in cost of services on the Consolidated Statements of Income. i. Research and Development Research and development expenses primarily consist of personnel costs and contractor fees related to the bundling of other third-party software products that are offered as one combined package within the Company’s product offerings. Personnel costs include salaries, bonuses, stock-based compensation, employer-paid payroll taxes, and an allocation of our facilities, benefits, and internal IT costs. Research and development costs are expensed as incurred. j. Advertising Advertising costs are expensed as incurred. Advertising costs amounted to $ 0.8 million for the period January 1, 2022, to August 3, 2022. k. Stock-Based Compensation The Company grants stock options to purchase common stock to employees with exercise prices equal to the fair market value of the underlying stock as determined by the Board of Directors and management. The Board of Directors, with the assistance of outside valuation experts, determines the fair value of the underlying stock by considering several factors including historical and projected financial results, the risks the Company faced on the grant date, the preferences of the Company’s debt holders and preferred stockholders, and the lack of liquidity of the Company’s common stock. The fair value of each stock option award is estimated using the Black-Scholes-Merton valuation model. Such value is recognized as expense over the requisite service period using the straight-line method, net of forfeitures as they occur. Excess tax benefits of awards that relate to stock option exercises are reflected as operating cash inflows. Stock-based compensation expense recognized in the Company’s Consolidated Statements of Income for options were negligible for all periods presented. l. Earnings (Loss) per Share Series A-1 and A-2 Preferred Stock are participating securities due to their rights to receive dividends. The Company calculates EPS under the two-class method. In the two-class method, all earnings (distributed and undistributed) are allocated to each class of common stock and participating securities. The allocation between common stock and participating securities is based upon the rights to dividends for the two types of securities. For periods of net income and when the effects are not anti-dilutive, the Company calculates diluted earnings per share by dividing net income available to common shareholders by the weighted average number of common shares plus the weighted average number of common shares assuming the conversion of the Company’s convertible notes, as well as the impact of all potentially dilutive common shares. Potentially dilutive common shares consist primarily of common stock options using the treasury stock method. For periods of net loss, shares used in the diluted earnings (loss) per share calculation equals the amount of shares in the basic EPS calculation as including potentially dilutive shares would be anti-dilutive. m. Concentrations of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash balances and trade accounts receivable. The Company maintains cash balances at two financial institutions. The balances, at times, exceed federally insured limits. As of August 3, 2022, balances exceeded federally insured limits by $ 16.0 million. The Company has not experienced any losses in such accounts, and believes it is not exposed to any significant credit risk from cash. Concentrations of credit with respect to accounts receivables are generally limited due to the large number of customers, outside the U.S. Government, comprising the Company's customer base and their dispersion across different industries. The Company generated 73 % of its revenue in for the period January 1, 2022, to August 3, 2022, from the U.S. Government, who generally pays invoices in less than thirty days and is deemed to be a low credit risk. On August 3, 2022, accounts receivables from the U.S. Government made up 64 % of the Company’s outstanding accounts receivables. n. Income Taxes The Company provides for income taxes using the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax effect of differences between recorded assets and liabilities and their respective tax basis along with operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to reverse. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period the rate change becomes effective. The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained in the event of a tax audit. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company records interest related unrecognized tax benefits in income tax expense. Deferred tax assets are reduced by a valuation allowance when in management’s opinion it is more likely than not that some portion or all the deferred tax assets will not be realized. The Company considers the future reversal of existing taxable temporary differences, taxable income in prior carryback years, projected future taxable income, and tax planning strategies in making this assessment. The Company’s valuation allowance is based on all available positive and negative evidence, including its recent financial operations, evaluation of positive and negative evidence with respect to certain specific deferred tax assets (including evaluating sources of future taxable income) to support the realization of the deferred tax assets. The Company's income tax returns are generally subject to examination by taxing authorities for a period of three years from the date they are filed. Tax authorities may have the ability to review and adjust net operating loss or tax credit carryforwards that were generated prior to these periods if utilized in an open tax year. As of August 3, 2022, the Company’s income tax returns for the years ended December 31, 2016 through 2021 are subject to examination by the Internal Revenue Service and applicable state and local taxing authorities. o. Sales and Use Taxes The Company collects sales tax in various jurisdictions. Upon collection from customers, it records the amount as a payable to the related jurisdiction. On a periodic basis, it files a sales tax return with the jurisdictions and remits the amounts indicated on the return. p. Segment Reporting Operating segments are identified as components of an enterprise for which separate discrete financial information is available for evaluation by the chief operating decision maker, the chief executive officer, or decision-making group, in making decisions on how to allocate resources and assess performance. The Company views its operations and manages its business as one operating segment. All revenue has been generated and all assets are held in the United States. q. Deferred Rent and Lease Incentives Rent expense and lease incentives from the Company’s operating leases are recognized on a straight-line basis over the lease term. The Company’s operating lease includes rent escalation payment terms and a rent-free period. Deferred rent represents the difference between actual operating lease payments and straight-line rent expense over the term of the lease. r. Standards Issued and Adopted s. Standards Issued but Not Yet Effective In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). This guidance is intended to improve financial reporting for leasing transactions. The standard is effective for the Company for annual reporting periods beginning after December 15, 2021, and early adoption is permitted. Upon adoption, the Company will be required to record right-of-use assets and lease liabilities on its Consolidated Balance Sheets for leases which were historically classified as operating leases. The Company expects the adoption to have a material increase on the assets and liabilities recorded on its Consolidated Balance Sheets. The Company does not expect a material impact to its Consolidated Statement of Comprehensive Loss or Consolidated Statement of Cash Flows following adoption. In June 2016 the FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Instruments, which amends the accounting for credit losses for most financial assets and certain other instruments. The standard requires that entities holding financial assets that are not accounted for at fair value through net income be presented at the net amount expected to be collected. An allowance for credit losses will be a valuation account that will be deducted from the amortized cost basis of the financial asset to present the net carrying value at the amount expected to be collected on the financial asset. The standard is effective for the Company for annual reporting periods beginning in fiscal year 2023. The Company does not believe the adoption will have a material impact on its consolidated financial statements. In December 2019, the FASB issued ASU 2019-12, Simplifying the Accounting for Income Taxes (Topic 740). The amendments will remove certain exceptions for recognizing deferred taxes for investments, performing intra-period allocation and calculating income taxes in interim periods. The ASU also adds guidance to reduce complexity in certain areas, including recognizing deferred taxes for tax goodwill and allocating taxes to members of a consolidated group. The amendments are effective for annual periods beginning after December 15, 2021, and interim periods within annual periods beginning after December 15, 2022. IDX is currently evaluating the impact of ASU 2019-12 on its consolidated financial statements and related disclosures. In March 2020, the FASB issued ASU No. 2020-06, Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (Topics: 470-20, 815-40). The standards reduce the number of accounting models for convertible instruments and allows more contracts to qualify for equity classification. The standard also amends diluted EPS calculations for convertible instruments and amends the requirements for a contract (or embedded derivative) that is potentially settled in an entity’s own shares to be classified in equity. The standard is effective for the Company for all interim and annual periods of our fiscal year ending December 31, 2024. Early adoption is permitted. IDX is currently evaluating the impact of ASU 2020-06 on its consolidated financial statements. In August 2020, the FASB issued ASU 2020-06, Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40). ASU 2020-06 simplifies the accounting for convertible instruments by eliminating large sections of the existing guidance in this area. It also eliminates several triggers for derivative accounting, including a requirement to settle certain contracts by delivering registered shares. The standard is effective for the Company for all interim and annual periods of our fiscal year ending December 31, 2024. Early adoption is permitted. IDX is currently evaluating the impact of ASU 2020-06 on its consolidated financial statements. |
Revenue from Contracts with Cus
Revenue from Contracts with Customers | 7 Months Ended | 12 Months Ended |
Aug. 03, 2022 | Jan. 31, 2024 | |
Disaggregation of Revenue [Line Items] | ||
Revenue from Contracts with Customers | 3: Revenue Disaggregation of Revenue The table below provides revenue earned by line of service for the year ended January 31, 2024, the Successor Period, and the Predecessor Period (in thousands). Successor Predecessor Revenue Line Year Ended January 31, 2024 August 4, 2022 to February 1, 2022 to Subscription revenue $ 89,308 $ 31,679 $ 27,946 Services revenue Breach 138,782 54,791 — Other services 5,210 1,916 1,291 Total services revenue 143,992 56,707 1,291 Total $ 233,300 $ 88,386 $ 29,237 The table below provides revenue earned based on geographic locations of our customers for the year ended January 31, 2024, the Successor Period, and the Predecessor Period (in thousands). Successor Predecessor Country Year Ended January 31, 2024 August 4, 2022 to February 1, 2022 to United States $ 214,423 $ 80,674 $ 21,916 Other 18,877 7,712 7,321 Total $ 233,300 $ 88,386 $ 29,237 For the year ended January 31, 2024, the Successor Period, and the Predecessor Period , no country other than the United States represented 10 % or more of total consolidated revenue. Contract Assets and Liabilities The components of contract assets and liabilities consist of the following (in thousands): January 31, 2024 January 31, 2023 Assets: Accounts receivable, net $ 38,923 $ 29,609 Deferred contract acquisition costs, current and non-current 10,106 13,207 Liabilities: Deferred revenue, current and non-current $ 86,846 $ 53,958 The significant components of the changes in the contract liabilities balances primarily consisted of revenue recognized that was included in the opening deferred revenue balance of $ 48.3 million and $ 31.4 million for the year ended January 31, 2024, and the Successor Period, respectively. As of January 31, 2024 and 2023, there was $ 3.9 million and $ 21.3 million, respectively, of remaining deferred revenue acquired in the Company's business acquisitions. Remaining Performance Obligations As of January 31, 2024, the Company had approximately $ 154.5 million of revenue that is expected to be recognized from remaining performance obligations that are unsatisfied (or partially unsatisfied) under non-cancelable contracts. Of this $ 154.5 million, the Company expects to recognize revenue of approximately $ 127.1 million in the period February 1, 2024 , through January 31, 2025, approximately $ 20.8 million in the period February 1, 2025 , through January 31, 2026, and approximately $ 6.6 million thereafter . | |
ID Experts Holdings, Inc. and Subsidiary [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contracts with Customers | : Revenue from Contracts with Customers Performance Obligations The Company’s primary performance obligations under breach services contracts are notification services and combined call center and monitoring services. These were determined by reviewing all of the services provided within the Company’s contracts and establishing whether each service is capable of being distinct and capable of being distinct within the context of the contract. With each performance obligation, the customer can benefit from the service either on its own or together with other resources readily available and it is separately identifiable from other promises in the contract. The following table summarizes breach revenue from contracts with customers for the period January 1, 2023, to August 3, 2022, (in thousands): January 1, 2022, to August 3, 2022 Notification services $ 8,386 Call center and monitoring services 55,692 Total breach services $ 64,078 Notification Services The Company’s notification and mailing services include project management, postage, and setup costs to develop notification templates that will be printed and mailed to the customer’s impacted population. These notifications are typically printed by the Company’s third-party printers and mailed via USPS. The Company recognizes revenue for notification services upfront upon the date that the notifications are mailed, which typically coincides with the call center start date. The Company is deemed to be the principal in these transactions as it is primarily responsible for fulfilling the obligation, has full discretion in price setting, and controls the notification services before the resulting notifications are transferred to the customer. Call Center and Identity Protection Services Call center services consist of fees charged to setup an incident-specific call center and website for the population of impacted individuals. The call center component of the Company’s services serves as a facilitation of its identity protection services and revenue is recognized ratably over the term of the arrangement, which typically lasts for 15 months total (3 months for the call center/enrollment period plus 12 months of identity protection services). Identity Protection services consist of fees charged to continually monitor individuals’ credit and identity. Additional services are bundled with identity protection services such as non-credit reporting, alerts, and insurance. The Company typically invoices for these services upfront for fixed price contracts. For variable price contracts, the Company typically invoices the call center services upfront and the notification services and identity protection services on a monthly basis, as incurred, over the enrollment period. The timing and content of billings may vary based on individual contracts, but such variances usually only occur with the largest breach contracts. Membership Services For the period January 1, 2022, to August 3, 2022, revenue from consumer membership services was $ 2.7 million. For the period January 1, 2022, to August 3, 2022, no single consumer membership services customer exceeded 10% of total revenue. Timing of Revenue Recognition As a result of the adoption of ASC 606, the timing of recognition of certain performance obligations has changed. For example, most breach services contracts contain distinct performance obligations and now have a portion of revenue recognized up front, whereas these arrangements were previously recognized over time. In addition, allocating the transaction price on a relative SSP basis under the new guidance has generally resulted in an acceleration of revenue of point-in-time performance obligations. Contract Costs During the period January 1, 2022, to August 3, 2022, the Company recognized $ 7.8 million of amortization expense of capitalized contract costs. Contract costs include fulfillment costs and costs to obtain contracts. There were no impairment losses recognized for the period January 1, 2022, to August 3, 2022. Remaining Performance Obligations Remaining performance obligations represent contracted revenue that has not been recognized, which include contract liabilities and amounts that will be billed and recognized as revenue in future periods. As of August 3, 2022, the Company had $ 86.6 million of remaining performance obligations. The approximate percentages expected to be recognized as revenue in the future are as follows (in thousands, except percentages): 0- 12 Months 13- 24 Months Over 24 Months Total Remaining Performance Obligations Breach services 98 % 2 % 0 % $ 85,932 Consumer membership services 100 % 0 % 0 % 678 Total 98 % 2 % 0 % $ 86,610 |
Property and Equipment, Net
Property and Equipment, Net | 12 Months Ended |
Jan. 31, 2024 | |
Property, Plant and Equipment [Line Items] | |
Property and Equipment, Net | 7 : Property and Equipment Property and equipment as of January 31, 2024 and 2023, consists of the following (in thousands): January 31, 2024 January 31, 2023 Computer hardware and purchased software $ 2,495 $ 907 Furniture and fixtures 8 20 Leasehold improvements 202 114 Total property and equipment 2,705 1,041 Less: accumulated depreciation ( 1,507 ) ( 370 ) Property and equipment, net $ 1,198 $ 671 Depreciation and amortization expense for the year ended January 31, 2024, the Successor Period, and the Predecessor Period was $ 1.7 million, $ 0.4 million, and $ 0.3 million, respectively. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Jan. 31, 2024 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |
Fair Value Measurements | 4 : Fair Value Measurements The following table sets forth by level within the fair value hierarchy the liabilities carried at fair value (in thousands): Fair value measurements at January 31, 2024 using: Level 1 Level 2 Level 3 Total Liabilities: Public warrants $ ( 76 ) $ — $ — $ ( 76 ) Private warrants — ( 67 ) ( 77 ) ( 144 ) Sponsor earnout shares — — ( 392 ) ( 392 ) Purchase consideration liability ( 3,499 ) — ( 863 ) ( 4,362 ) Total financial liabilities $ ( 3,575 ) $ ( 67 ) $ ( 1,332 ) $ ( 4,974 ) The following table sets forth by level within the fair value hierarchy the assets (liabilities) carried at fair value (in thousands): Fair value measurements at January 31, 2023 using: Level 1 Level 2 Level 3 Total Assets: Cash equivalents - money market funds $ 557 $ — $ — $ 557 Total financial assets $ 557 $ — $ — $ 557 Liabilities: Public warrants $ ( 1,373 ) $ — $ — $ ( 1,373 ) Private warrants — ( 1,208 ) — ( 1,208 ) Sponsor earnout shares — — ( 2,445 ) ( 2,445 ) Total financial liabilities $ ( 1,373 ) $ ( 1,208 ) $ ( 2,445 ) $ ( 5,026 ) See Note 10 for a discussion of the fair value of debt. The assumptions used to value the warrants are described in Note 11. The assumptions used to value the Sponsor Earnout Shares are described in Note 11. Purchase Consideration Liability As of January 31, 2024, the Company had an obligation to transfer $ 4.4 million in stock to the former owners of LookingGlass in connection with the LookingGlass Acquisition (see Note 5). The Purchase Consideration Liability represents a financial liability that will be settled in shares of the Company's Common Stock. The Company classified the fair value of the Purchase Consideration Liability related to the variable portion of the LookingGlass Deferred Shares as Level 3 within the fair value hierarchy. This portion of the fair value includes estimates of certain contingencies to be achieved as of the reporting date, which are considered unobservable inputs. The remaining fair value of the Purchase Consideration Liability which we do not consider to be variable is classified as Level 1 within the fair value hierarchy as it is based on the price of the Company's publicly traded stock. The assumptions used to value the Purchase Consideration Liability are described in Note 11. The carrying amounts of accounts receivable, accounts payable, and accrued expenses approximate fair value because of the short maturity terms of these instruments. |
Acquisitions
Acquisitions | 12 Months Ended |
Jan. 31, 2024 | |
Business Combinations [Abstract] | |
Acquisitions | 5 : Acquisitions The Business Combination On August 3, 2022 , L&F, ZeroFox, Inc., and IDX, consummated the business combination as contemplated by the Business Combination Agreement, dated as of December 17, 2021 . In connection with the finalization of the Business Combination, L&F changed its name to ZeroFox Holdings, Inc. and changed its jurisdiction of incorporation from the Cayman Islands to the state of Delaware. The Company changed its fiscal year end to January 31. The Company's Common Stock and public warrants began trading under the tickers ZFOX and ZFOXW, respectively. A summary of other terms provided with the settlement of the transaction is disclosed in the Company's fiscal year 2023 10-K, filed with the SEC on March 30, 2023. Accounting for the ZeroFox, Inc. Merger As of July 31, 2023, the Company finalized its evaluation of the initial values of the assets and liabilities of ZeroFox, Inc. that were acquired in the Business Combination. The following table summarizes the fair value of the purchase consideration paid to affect the merger of ZeroFox, Inc. (in thousands, except per share data): Equity value of consideration Common stock issued to holders of ZeroFox, Inc. 82,030,308 Closing price per share of the Company's Common Stock (ZFOX) on August 3, 2022 $ 10.95 Fair value of Common Stock issued $ 898,232 Cash consideration Repayment of ZeroFox, Inc. debt and interest 37,674 Payment of ZeroFox, Inc. transaction expenses 8,500 Repayment of notes payable to PIPE Investors 5,000 Total consideration paid $ 949,406 The Company recorded the allocation of the purchase price to ZeroFox, Inc.'s assets acquired and liabilities assumed based on their fair values as of August 3, 2022. The final purchase price allocation is as follows (in thousands): Cash and cash equivalents $ 2,806 Accounts receivable 13,961 Prepaid expenses and other assets 2,201 Property and equipment 598 Other assets 341 Goodwill 828,091 Intangible assets 185,000 Total assets acquired 1,032,998 Accounts payable 4,310 Accrued liabilities 3,921 Current portion of long term debt 938 Deferred revenue, current 35,432 Deferred revenue, net of current portion 6,325 Long term debt 16,851 Warrants liabilities 7,632 Deferred tax liability 8,183 Total liabilities assumed 83,592 Total consideration transferred $ 949,406 Accounting for the IDX Merger As of July 31, 2023, the Company finalized its evaluation of the initial values of the assets and liabilities of IDX that were acquired in the Business Combination. The following table summarizes the fair value of the purchase consideration paid to affect the merger of IDX (in thousands, except per share data): Equity value consideration Common stock issued to holders of IDX 27,849,942 Closing price per share of the Company's Common Stock (ZFOX) on August 3, 2022 $ 10.95 Fair value of Common Stock issued $ 304,957 Cash consideration paid to IDX shareholders 44,447 Cash consideration gross up for offset of PIPE subscribers also IDX holders 5,000 Repayment of debt and interest 12,484 Payment of IDX transaction expenses 1,500 Total consideration paid $ 368,388 The Company recorded the allocation of the purchase price to IDX's assets acquired and liabilities assumed based on their fair values as of August 3, 2022. The following table sets forth the amounts allocated to the intangible assets identified, the estimated useful lives of those intangible assets, and the methodologies used to determine the fair values of those intangible assets (dollars in thousands): Cash and cash equivalents $ 13,727 Accounts receivable 11,944 Prepaid and other expense 2,939 Property and equipment 125 Goodwill 285,970 Intangible Assets 100,500 Total assets acquired 415,205 Accounts payable $ 7,568 Accrued liabilities 4,944 Deferred revenue, current 9,314 Deferred revenue, net of current portion 1,522 Deferred tax liability 23,469 Total liabilities assumed 46,817 Total consideration transferred $ 368,388 Purchase Accounting Adjustments The Company recorded an adjustment during the three months ended July 31, 2023, to remove the carrying values of deferred contract acquisition costs that existed on the opening balance sheets of ZeroFox, Inc. and IDX on the Closing Date. The adjustment recorded included the reclassification to goodwill of the net book value of the deferred contract acquisition costs recorded on the balance sheets as of April 30, 2023, the reversal of sales and marketing expense related to the amortization of the deferred contract acquisition costs recognized in prior periods, and a reduction to the related deferred tax liabilities. The net impact of all elements of this adjustment was an increase to goodwill of $ 7.5 million and $ 0.2 million related to the acquisitions of ZeroFox, Inc. and IDX, respectively. The Company recorded additional entries for certain tax matters related to the acquisition of IDX during the three months ended July 31, 2023. The Company reduced income tax payable by $ 1.3 million to account for the portion of transaction costs related to the Business Combination that were deductible for income tax purposes. The Company recorded an additional $ 0.5 million reserve for IDX income tax positions that did not meet the more-likely-than-not recognition threshold. The net impact of these adjustments was a decrease to goodwill of $ 0.8 million related to the acquisition of IDX. LookingGlass Acquisition On April 21, 2023 , the Company completed the acquisition of LookingGlass, a privately-held software company (the LookingGlass Acquisition). The Company expects the acquisition of LookingGlass will strengthen the Company's Platform with industry-leading external attack surface and threat intelligence capabilities. The purchase consideration includes a potential maximum of 9.637 million shares of Company Common Stock, subject to adjustment for the LookingGlass Earnout Shares (see Note 11) and other customary purchase price adjustments. As of the date of the transaction, the Company estimates that 8.629 million shares will be issued to the selling shareholders. The following table summarizes the estimated fair value of the purchase consideration (in thousands, except per share data): Purchase consideration liability: Purchase consideration shares LookingGlass Earnout Shares 1,837,500 LookingGlass Deferred Shares 6,791,456 Total purchase consideration shares 8,628,956 Adjusted closing price per share of the Company's Common Stock (ZFOX) on April 21, 2023 $ 1.10 Fair value of purchase consideration liability $ 9,465 Cash consideration $ 9,500 Convertible note 3,333 Total purchase consideration $ 22,298 The Purchase Consideration Liability is discussed further in Note 11. The convertible note is discussed further in Note 10 under the caption, "Alsop Louie Convertible Note". The Company recorded the preliminary allocation of the purchase price to LookingGlass' assets acquired and liabilities assumed based on their fair values as of April 21, 2023. The preliminary purchase price allocation is as follows (in thousands): Cash and cash equivalents $ 1,608 Accounts receivable 3,233 Prepaid expenses and other assets 1,562 Property and equipment, net 1,627 Operating lease right-of-use assets 656 Goodwill 4,832 Intangible assets 17,900 Deferred tax assets 6,515 Total assets acquired $ 37,933 Accounts payable $ 1,304 Accrued compensation, accrued expenses, and other current liabilities 2,279 Operating lease liabilities, current 584 Deferred revenue, current 10,850 Other liabilities 524 Operating lease liabilities, net of current portion 94 Total liabilities assumed 15,635 Total consideration transferred $ 22,298 The following table sets forth the amounts allocated to the intangible assets identified, the estimated useful lives of those intangible assets, and the methodologies used to determine the fair values of those intangible assets (dollars in thousands): Fair Value Useful Life (in years) Fair Value Methodology Customer relationships $ 13,700 10 Multi-period Excess Earnings method of the Income Approach Developed technology 4,000 7 Relief from Royalty method Trade names and trademarks 200 2 Relief from Royalty method $ 17,900 The goodwill of $ 4.8 million represents the excess purchase price over the fair value of the net tangible and identifiable intangible assets acquired and liabilities assumed. Qualitative factors that contribute to the recognition of goodwill include certain intangible assets that are not recognized as separate, identifiable intangible assets apart from goodwill. Intangible assets not recognized apart from goodwill consist primarily of expertise and industry know-how of the workforce, developed technology, back-office infrastructure, strong market position, and the assembled workforce of LookingGlass. None of the goodwill recognized is expected to be deductible for income tax purposes. The measurement period for the assets and liabilities for the LookingGlass Acquisition remains open for the period of up to one year following completion of the transaction. The Company is finalizing the fair value of the purchase consideration liability and allocation of purchase price, including income taxes. The results of operations of LookingGlass are included in the Company's Consolidated Statements of Comprehensive Loss from the acquisition date and were not material. The impact of the unaudited supplemental pro forma financial statements is not material to the consolidated financial statements and therefore this information is not presented. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Jan. 31, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | 6 : Goodwill and Intangible Assets A summary of the changes in the fair value of goodwill for the year ended January 31, 2024, the Successor Period, and the Predecessor Period, respectively, is as follows (in thousands): Successor Goodwill (gross) - January 31, 2023 $ 1,105,258 Accumulated impairment loss ( 698,650 ) Goodwill (net) - January 31, 2023 406,608 Business acquisition 4,832 Adjustment to purchase accounting from the Business Combination 6,900 Impairment ( 284,240 ) Goodwill (net) - January 31, 2024 $ 134,100 Predecessor Goodwill (gross) - January 31, 2022 $ 35,002 Accumulated impairment loss - Goodwill (net) - August 3, 2022 $ 35,002 The Company recorded goodwill impairment charges of $ 284.2 million during the year ended January 31, 2024. The Company recorded a $ 72.1 million impairment charge as result of its annual test of goodwill as of October 31, 2023. The Company's estimate of the fair value of its single reporting unit of $ 572.7 million was below the carrying value of the reporting unit of $ 644.8 million as of October 31, 2023. The remaining $ 212.1 million was recorded as part of an interim test of goodwill. The Company's estimate of the fair value of its single reporting unit of $ 348.1 million that was based on the enterprise value implied by Haveli Merger Agreement (see Note 18), was below the carrying value of the reporting unit of $ 560.2 million as of January 31, 2024. The Company recorded an impairment cha rge of $ 698.7 million during the Successor Period, as result of its annual test of goodwill. The Company's estimate of the fair value of its single reporting unit of $ 675.0 million was below the carrying value of the reporting unit of $ 1,373.7 million as of October 31, 2022. Determining the fair value of our reporting unit requires judgment and the use of significant estimates and assumptions. Given the current competitive and macroeconomic environment and the uncertainties regarding the related impact on the business, there can be no assurance that the estimates and assumptions made for purposes of the Company’s interim and annual goodwill impairment tests will prove to be accurate predictions of the future. If the Company’s assumptions are not realized, the Company may record additional goodwill impairment charges in the future. It is not possible at this time to determine if any such future impairment charge would result or whether such charge would be material. The tables below summarize the Company’s intangible assets as of January 31, 2024, and 2023 (amounts in thousands, except for useful lives). As of January 31, 2024 Weighted Average Useful Life (in years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Customer relationships 7.8 $ 168,100 $ ( 35,174 ) $ 132,926 Developed technology 5.1 99,800 ( 29,028 ) $ 70,772 Trademarks / trade names 10.0 35,500 ( 5,344 ) $ 30,156 $ 303,400 $ ( 69,546 ) $ 233,854 As of January 31, 2023 Weighted Average Useful Life (in years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Customer relationships 8.6 $ 154,400 $ ( 11,894 ) $ 142,506 Developed technology 5.0 95,800 ( 9,425 ) 86,375 Trademarks / trade names 10.0 35,300 ( 1,737 ) 33,563 $ 285,500 $ ( 23,056 ) $ 262,444 The Company analyzed if there was an impairment of long-lived assets as of January 31, 2024. The Company determined that the carrying value of its assets were recoverable and accordingly, concluded that no impairment had occurred. The tables below summarizes the future amortization of the Company’s intangible assets as of January 31, 2024 (amounts in thousands). Fiscal 2025 $ 44,981 Fiscal 2026 44,904 Fiscal 2027 44,881 Fiscal 2028 35,456 Fiscal 2029 20,515 Thereafter 43,117 Total amortization of intangible assets expense $ 233,854 On the Company's Consolidated Statement of Comprehensive Loss, the Company recognizes expense for the amortization of customer relationships within sales and marketing expense, expense for the amortization of developed technology within cost of subscription revenue, and expense for the amortization of trademarks and trade names within general and administrative expense. The Company recognized amortization of intangible assets expense in the accompanying Consolidated Statements of Comprehensive Loss for the year ended January 31, 2024, the Successor Period, and the Predecessor Period, as follows (in thousands): Successor Predecessor Year Ended January 31, 2024 August 4, 2022 to February 1, 2022 to Cost of revenue - subscription $ 19,603 $ 9,425 $ 260 Sales and marketing 23,280 11,894 1,308 General and administrative 3,607 1,737 36 Total amortization of acquired intangible assets $ 46,490 $ 23,056 $ 1,604 |
Leases
Leases | 12 Months Ended |
Jan. 31, 2024 | |
Lessee, Lease, Description [Line Items] | |
Leases | 8 : Leases The Company has operating leases for office facilities and office equipment. Our leases have remaining terms of less than one year to approximately three years , some of which include options to renew. Our total net cost for operating leases for the year ended January 31, 2024 was $ 2.6 million. The total net cost for operating leases for the Successor Period and the Predecessor Period was $ 1.6 million. Included in the measurement of the lease liability at January 31, 2023, is $ 1.6 million in cash payments for operating leases which were made during the Successor Period and the Predecessor Period. Supplemental balance sheet information related to lease liabilities is as follows: (in thousands, except lease term and discount rate) January 31, 2024 January 31, 2023 Operating leases Operating ROU assets $ 3,553 $ 720 Operating lease liabilities, current $ 1,638 $ 406 Operating lease liabilities, net of current portion 2,111 427 Total operating lease liabilities $ 3,749 $ 833 Weighted average remaining lease term 2.4 years 1.7 years Weighted average discount rate 7.1 % 4.8 % Maturities of operating lease liabilities at January 31, 2024 is as follows: (in thousands) Year ending January 31, 2025 $ 1,863 2026 1,409 2027 760 2028 82 Total lease payments 4,114 Less: imputed interest ( 365 ) Total lease payments $ 3,749 |
Long-term Debt
Long-term Debt | 12 Months Ended |
Jan. 31, 2024 | |
Debt Instrument [Line Items] | |
Long-term Debt | 1 0: Debt The tables below summarize key terms of the Company’s debt that was outstanding as of January 31, 2024 and 2023 (amounts in thousands, except for interest rates). As of January 31, 2024 Lender Stated Effective Gross Unamortized Unamortized Net Stifel Bank 9.50 % 9.86 % $ 22,500 $ ( 83 ) $ ( 52 ) $ 22,365 InfoArmor 5.50 % 5.50 % 1,406 — — 1,406 Convertible notes 7.00 % Cash / 8.75 % PIK 9.78 % 170,738 — ( 77 ) 170,661 Alsop Louie Convertible Note (1) 6.00 % 3.36 % 3,333 — — 3,333 $ 197,977 $ ( 83 ) $ ( 129 ) $ 197,765 Current portion of long-term debt $ 938 Long-term debt 196,827 $ 197,765 (1) Per the note agreement, the note is interest free for the first twelve months and bears interest at a rate of 6 % per annum thereafter. As of January 31, 2023 Lender Stated Effective Gross Unamortized Unamortized Net Stifel Bank 8.50 % 8.50 % $ 15,000 $ — $ — $ 15,000 InfoArmor 5.50 % 5.50 % 2,344 — — 2,344 Convertible notes 7.00 % Cash / 8.75 % PIK 8.53 % 156,564 — ( 127 ) 156,437 $ 173,908 $ — $ ( 127 ) $ 173,781 Current portion of long-term debt $ 15,938 Long-term debt 157,843 $ 173,781 Stifel Note On January 7, 2021, the Predecessor entered into a loan and security agreement with Stifel Bank (“Stifel”) for $ 10.0 million, which is collateralized by substantially all of the assets of the Predecessor. In conjunction with the loan and security agreement, the Predecessor issued warrants to Stifel (se e Note 11 fo r discussion of warrants). The loan and security agreement provided for an immediate advance, upon loan closing, of $ 10.0 million, which the Predecessor drew in full. Advances under the agreement pay cash interest monthly at the greater of the prime rate as reported in the Wall Street Journal plus 1.00 %, or 4.50 % per annum. If any loan payment is not made within 10 days of the payment due date, the Predecessor will incur a late fee equal to the lesser of (i) 5.00 % of the unpaid amount or (ii) the maximum amount permitted to be charged under applicable law, not in any case to be less than twenty-five dollars. The loan matures and all unpaid principal and interest is due in full on January 7, 2024 . On December 8, 2021, the Predecessor amended its loan and security agreement with Stifel. The amendment provided for an additional borrowing of $ 5.0 million, for which the Company borrowed $ 5.0 million in December 2021 and issued 161,113 warrants to purchase Series E redeemable convertible preferred stock at an exercise price of $ 1.86205 . As of January 31, 2023, the outstanding principal of the loan included $ 15.0 million of principal borrowed. In connection with the Business Combination, the Company amended its loan and security agreement with Stifel Bank. The amendment superseded the financial covenants with which the Company must be in compliance. The amended financial covenants include the following commitments: a) a balance of cash held at Stifel Bank in an amount equal to or greater than the amount of outstanding debt and b) minimum liquidity (as defined in the loan and security agreement). The Company was in compliance with its financial covenants as of January 31, 2024. In connection with the LookingGlass Acquisition, the Company amended its loan and security agreement with Stifel Bank on April 21, 2023. The amendment extended the maturity date to June 30, 2025 , and increased the aggregate borrowing limit to $ 22.5 million. The Company borrowed $ 7.5 million on April 21, 2023, and issued a warrant to purchase 128,676 shares of Common Stock at an exercise price of $ 1.36 . As of January 31, 2024, the outstanding principal of the loan included $ 22.5 million of principal borrowed. On March 4, 2024, the Company amended its loan and security agreement with Stifel Bank. The amendment, among other things, increased the amounts for which the Company may fund to certain of its subsidiaries. The loan and security agreement with Stifel contains a provision whereby, in the Event of Default, the obligation will bear additional interest at a rate equal to 4 %. Management evaluated Events of Default and determined the non-credit related events of default represent an embedded derivative that must be bifurcated and accounted for separately from the loan and security agreement. The default rate derivative is treated as a liability, initially measured at fair value with subsequent changes in fair value recorded in earnings. Management has assessed the probability of occurrence for a non-credit default event and determined the likelihood of a referenced event to be remote. Therefore, the estimated fair value of the default rate derivative was negligible as of January 31, 2024 and 2023, and no amount was recorded. The Company determined the fair value of the note to be the principal value and accrued interest outstanding. On January 31, 2024, the carrying amount of the note approximates fair value due to the short duration of time that has elapsed since the note has been amended. The loan with Stifel Bank is secured by all assets of the Company. InfoArmor Note On June 7, 2021, the Predecessor issued a $ 3.8 million promissory note payable to InfoArmor, Inc. in connection with its acquisition of Vigilante, which was at that time a subsidiary of InfoArmor. The promissory note accrues interest at 5.5 % per annum (computed on the basis of a 365 day year). Principal and interest payments of $ 0.2 million are paid quarterly over the four-year term of the loan maturing on June 7, 2025 . As of January 31, 2024, $ 0.9 mill ion was recorded in current portion of long-term debt in the consolidated financial statements. In connection with the Business Combination, the Company recorded the debt outstanding with InfoArmor at fair value. The Company determined the fair value of these notes to be the principal value and accrued interest outstanding at the date of the Business Combination. The loan with InfoArmor is unsecured. Convertible Notes On August 3, 2022, the Company closed subscription agreements with certain purchasers to sell $ 150.0 million aggregate principal amount of unsecured convertible notes due 2025 (the Convertible Notes). In connection with the Business Combination, the Company completed the Convertible Notes financing of $ 150.0 million. The Convertible Notes include a cash interest option of 7 % per annum, payable quarterly, and a payment-in-kind (PIK) interest option of 8.75 % per annum. The Convertible Notes include a default rate of interest feature. In the event of default by the Company, the rate of interest will be increased by 2.00 % per annum. The Convertible Notes are convertible into shares of Company Common Stock, or a combination of cash and Company Common Stock, at the Company's election, at an initial conversion price of $ 11.50 , subject to customary anti-dilution provisions. The Convertible Notes mature on August 3, 2025 . The Company may, at its election, force conversion of the Convertible Notes after the first anniversary of their issuance if the volume-weighted average trading price of the Company's Common Stock is greater than or equal to 150 % of the conversion price for more than 20 trading days during a period of 30 consecutive trading days. After the second anniversary of their issuance this provision drops to greater than or equal to 130 % of the conversion price for more than 20 trading days during a period of 30 consecutive trading dates. The first anniversary of the issuance of the Convertible Notes occurred on August 3, 2023; the Company has not forced conversion of the Convertible Notes after this date. In the event that a holder of the Convertible Notes elects to covert, the Company will be obligated to pay an amount equal to outstanding principal and interest (accrued and unpaid), at the initial conversion rate of 86.9565 shares of Common Stock per $ 1,000 of outstanding principal and accrued interest. Each holder of a Note will have the right to cause the Company to repurchase for cash all or a portion of the Convertible Notes held by such holder upon the occurrence of a fundamental change (as defined in the indenture governing the Convertible Notes), at a price equal to 100 % of the principal plus accrued and unpaid interest, plus any remaining amounts that would be owed to, but excluding, the maturity date. In the event of a conversion in connection with a Fundamental Change, the conversion price will be adjusted in accordance with a Fundamental Change make-whole table. The Company analyzed the features of the make-whole table and concluded that it did not require bifurcation pursuant to ASC 815 as the variables that could affect the settlement amount would be inputs to a fixed-for-fixed forward option on equity shares and as such, may be considered indexed to the Company's own equity. At January 31, 2024, the net carrying amount of the Convertible Notes approximates fair value. Alsop Louie Convertible Note In connection with the LookingGlass Acquisition, on April 21, 2023, the Company issued a subordinated convertible promissory note in the principal amount of approximately $ 3.3 million to Alsop Louie Capital 2, L.P. in satisfaction of certain LookingGlass indebtedness (the "Alsop Louie Convertible Note"). The Alsop Louie Convertible Note matures on July 31, 2025 , is interest free for the first twelve months, and bears interest at a rate of 6 % per annum thereafter. Upon maturity of the Alsop Louie Convertible Note, the Company shall be obligated to pay, and prior to maturity the Company may elect to prepay, the principal amount and accrued interest on the Alsop Louie Convertible Note by paying cash, by issuing shares of Common Stock, or by a combination of cash and shares. At any time beginning July 1, 2024, the Alsop Louie Convertible Note shall become due if the volume-weighted average trading price of the Company’s Common Stock equals or exceeds $ 5.00 over a twenty-day trading period. The note holder will have the right to cause the Company to pay all of its outstanding obligation upon the occurrence of an event of default (as defined in the agreement governing the Alsop Louie Convertible Note), at a price equal to 100 % of the principal plus accrued and unpaid interest. Additionally, upon the occurrence of an event of default, the interest rate accruing on the unpaid interest will increase by 1.5 % per annum after each anniversary of the event of default. Any payments on the Alsop Louie Convertible Note with shares of the Company's Common Stock will be determined based on the volume-weighted average trading price over a five-day trading period. The Company analyzed the share conversion features and concluded they did not require bifurcation pursuant to ASC 815 as the variables that could affect the settlement amount would be inputs to a fixed-for-fixed forward option on equity shares and as such, may be considered indexed to the Company's own equity. On January 31, 2024, the carrying amount of the Alsop Louie Convertible Note approximates fair value due to the short duration of time that has elapsed since the Alsop Louie Convertible Notes has been issued. |
Debt
Debt | 12 Months Ended |
Jan. 31, 2024 | |
Debt Disclosure [Abstract] | |
Debt | 1 0: Debt The tables below summarize key terms of the Company’s debt that was outstanding as of January 31, 2024 and 2023 (amounts in thousands, except for interest rates). As of January 31, 2024 Lender Stated Effective Gross Unamortized Unamortized Net Stifel Bank 9.50 % 9.86 % $ 22,500 $ ( 83 ) $ ( 52 ) $ 22,365 InfoArmor 5.50 % 5.50 % 1,406 — — 1,406 Convertible notes 7.00 % Cash / 8.75 % PIK 9.78 % 170,738 — ( 77 ) 170,661 Alsop Louie Convertible Note (1) 6.00 % 3.36 % 3,333 — — 3,333 $ 197,977 $ ( 83 ) $ ( 129 ) $ 197,765 Current portion of long-term debt $ 938 Long-term debt 196,827 $ 197,765 (1) Per the note agreement, the note is interest free for the first twelve months and bears interest at a rate of 6 % per annum thereafter. As of January 31, 2023 Lender Stated Effective Gross Unamortized Unamortized Net Stifel Bank 8.50 % 8.50 % $ 15,000 $ — $ — $ 15,000 InfoArmor 5.50 % 5.50 % 2,344 — — 2,344 Convertible notes 7.00 % Cash / 8.75 % PIK 8.53 % 156,564 — ( 127 ) 156,437 $ 173,908 $ — $ ( 127 ) $ 173,781 Current portion of long-term debt $ 15,938 Long-term debt 157,843 $ 173,781 Stifel Note On January 7, 2021, the Predecessor entered into a loan and security agreement with Stifel Bank (“Stifel”) for $ 10.0 million, which is collateralized by substantially all of the assets of the Predecessor. In conjunction with the loan and security agreement, the Predecessor issued warrants to Stifel (se e Note 11 fo r discussion of warrants). The loan and security agreement provided for an immediate advance, upon loan closing, of $ 10.0 million, which the Predecessor drew in full. Advances under the agreement pay cash interest monthly at the greater of the prime rate as reported in the Wall Street Journal plus 1.00 %, or 4.50 % per annum. If any loan payment is not made within 10 days of the payment due date, the Predecessor will incur a late fee equal to the lesser of (i) 5.00 % of the unpaid amount or (ii) the maximum amount permitted to be charged under applicable law, not in any case to be less than twenty-five dollars. The loan matures and all unpaid principal and interest is due in full on January 7, 2024 . On December 8, 2021, the Predecessor amended its loan and security agreement with Stifel. The amendment provided for an additional borrowing of $ 5.0 million, for which the Company borrowed $ 5.0 million in December 2021 and issued 161,113 warrants to purchase Series E redeemable convertible preferred stock at an exercise price of $ 1.86205 . As of January 31, 2023, the outstanding principal of the loan included $ 15.0 million of principal borrowed. In connection with the Business Combination, the Company amended its loan and security agreement with Stifel Bank. The amendment superseded the financial covenants with which the Company must be in compliance. The amended financial covenants include the following commitments: a) a balance of cash held at Stifel Bank in an amount equal to or greater than the amount of outstanding debt and b) minimum liquidity (as defined in the loan and security agreement). The Company was in compliance with its financial covenants as of January 31, 2024. In connection with the LookingGlass Acquisition, the Company amended its loan and security agreement with Stifel Bank on April 21, 2023. The amendment extended the maturity date to June 30, 2025 , and increased the aggregate borrowing limit to $ 22.5 million. The Company borrowed $ 7.5 million on April 21, 2023, and issued a warrant to purchase 128,676 shares of Common Stock at an exercise price of $ 1.36 . As of January 31, 2024, the outstanding principal of the loan included $ 22.5 million of principal borrowed. On March 4, 2024, the Company amended its loan and security agreement with Stifel Bank. The amendment, among other things, increased the amounts for which the Company may fund to certain of its subsidiaries. The loan and security agreement with Stifel contains a provision whereby, in the Event of Default, the obligation will bear additional interest at a rate equal to 4 %. Management evaluated Events of Default and determined the non-credit related events of default represent an embedded derivative that must be bifurcated and accounted for separately from the loan and security agreement. The default rate derivative is treated as a liability, initially measured at fair value with subsequent changes in fair value recorded in earnings. Management has assessed the probability of occurrence for a non-credit default event and determined the likelihood of a referenced event to be remote. Therefore, the estimated fair value of the default rate derivative was negligible as of January 31, 2024 and 2023, and no amount was recorded. The Company determined the fair value of the note to be the principal value and accrued interest outstanding. On January 31, 2024, the carrying amount of the note approximates fair value due to the short duration of time that has elapsed since the note has been amended. The loan with Stifel Bank is secured by all assets of the Company. InfoArmor Note On June 7, 2021, the Predecessor issued a $ 3.8 million promissory note payable to InfoArmor, Inc. in connection with its acquisition of Vigilante, which was at that time a subsidiary of InfoArmor. The promissory note accrues interest at 5.5 % per annum (computed on the basis of a 365 day year). Principal and interest payments of $ 0.2 million are paid quarterly over the four-year term of the loan maturing on June 7, 2025 . As of January 31, 2024, $ 0.9 mill ion was recorded in current portion of long-term debt in the consolidated financial statements. In connection with the Business Combination, the Company recorded the debt outstanding with InfoArmor at fair value. The Company determined the fair value of these notes to be the principal value and accrued interest outstanding at the date of the Business Combination. The loan with InfoArmor is unsecured. Convertible Notes On August 3, 2022, the Company closed subscription agreements with certain purchasers to sell $ 150.0 million aggregate principal amount of unsecured convertible notes due 2025 (the Convertible Notes). In connection with the Business Combination, the Company completed the Convertible Notes financing of $ 150.0 million. The Convertible Notes include a cash interest option of 7 % per annum, payable quarterly, and a payment-in-kind (PIK) interest option of 8.75 % per annum. The Convertible Notes include a default rate of interest feature. In the event of default by the Company, the rate of interest will be increased by 2.00 % per annum. The Convertible Notes are convertible into shares of Company Common Stock, or a combination of cash and Company Common Stock, at the Company's election, at an initial conversion price of $ 11.50 , subject to customary anti-dilution provisions. The Convertible Notes mature on August 3, 2025 . The Company may, at its election, force conversion of the Convertible Notes after the first anniversary of their issuance if the volume-weighted average trading price of the Company's Common Stock is greater than or equal to 150 % of the conversion price for more than 20 trading days during a period of 30 consecutive trading days. After the second anniversary of their issuance this provision drops to greater than or equal to 130 % of the conversion price for more than 20 trading days during a period of 30 consecutive trading dates. The first anniversary of the issuance of the Convertible Notes occurred on August 3, 2023; the Company has not forced conversion of the Convertible Notes after this date. In the event that a holder of the Convertible Notes elects to covert, the Company will be obligated to pay an amount equal to outstanding principal and interest (accrued and unpaid), at the initial conversion rate of 86.9565 shares of Common Stock per $ 1,000 of outstanding principal and accrued interest. Each holder of a Note will have the right to cause the Company to repurchase for cash all or a portion of the Convertible Notes held by such holder upon the occurrence of a fundamental change (as defined in the indenture governing the Convertible Notes), at a price equal to 100 % of the principal plus accrued and unpaid interest, plus any remaining amounts that would be owed to, but excluding, the maturity date. In the event of a conversion in connection with a Fundamental Change, the conversion price will be adjusted in accordance with a Fundamental Change make-whole table. The Company analyzed the features of the make-whole table and concluded that it did not require bifurcation pursuant to ASC 815 as the variables that could affect the settlement amount would be inputs to a fixed-for-fixed forward option on equity shares and as such, may be considered indexed to the Company's own equity. At January 31, 2024, the net carrying amount of the Convertible Notes approximates fair value. Alsop Louie Convertible Note In connection with the LookingGlass Acquisition, on April 21, 2023, the Company issued a subordinated convertible promissory note in the principal amount of approximately $ 3.3 million to Alsop Louie Capital 2, L.P. in satisfaction of certain LookingGlass indebtedness (the "Alsop Louie Convertible Note"). The Alsop Louie Convertible Note matures on July 31, 2025 , is interest free for the first twelve months, and bears interest at a rate of 6 % per annum thereafter. Upon maturity of the Alsop Louie Convertible Note, the Company shall be obligated to pay, and prior to maturity the Company may elect to prepay, the principal amount and accrued interest on the Alsop Louie Convertible Note by paying cash, by issuing shares of Common Stock, or by a combination of cash and shares. At any time beginning July 1, 2024, the Alsop Louie Convertible Note shall become due if the volume-weighted average trading price of the Company’s Common Stock equals or exceeds $ 5.00 over a twenty-day trading period. The note holder will have the right to cause the Company to pay all of its outstanding obligation upon the occurrence of an event of default (as defined in the agreement governing the Alsop Louie Convertible Note), at a price equal to 100 % of the principal plus accrued and unpaid interest. Additionally, upon the occurrence of an event of default, the interest rate accruing on the unpaid interest will increase by 1.5 % per annum after each anniversary of the event of default. Any payments on the Alsop Louie Convertible Note with shares of the Company's Common Stock will be determined based on the volume-weighted average trading price over a five-day trading period. The Company analyzed the share conversion features and concluded they did not require bifurcation pursuant to ASC 815 as the variables that could affect the settlement amount would be inputs to a fixed-for-fixed forward option on equity shares and as such, may be considered indexed to the Company's own equity. On January 31, 2024, the carrying amount of the Alsop Louie Convertible Note approximates fair value due to the short duration of time that has elapsed since the Alsop Louie Convertible Notes has been issued. |
Other Liabilities
Other Liabilities | 12 Months Ended |
Jan. 31, 2024 | |
Other Liabilities Disclosure [Abstract] | |
Other Liabilities | 11: Other Liabilities Other liabilities consists of warrants, sponsor earnout shares, purchase consideration liability, deferred tax liability (see Note 14), and other, as follows: January 31, 2024 January 31, 2023 Purchase consideration liability $ 4,362 $ — Deferred tax liability 4,219 21,638 Other 2,117 954 Sponsor earnout shares 392 2,445 Warrants 220 2,581 Total other liabilities $ 11,310 $ 27,618 ZeroFox Holdings, Inc. Public Warrants and Private Warrants At January 31, 2024, there were 8,625,000 Public Warrants and 7,588,430 Private Warrants outstanding. The Public Warrants became exercisable on September 2, 2022, which was 30 days after the completion of the Business Combination. The Public Warrants will expire five years from the completion of the Business Combination or earlier upon redemption or liquidation. Redemption Features The Company may redeem the entirety of outstanding warrants (except as described with respect to the Private Warrants) at a price of $ 0.01 per warrant, with a minimum 30 days prior written notice of redemption, if t he closing price of the share of Company Common Stock equals or exceeds $ 18.00 per share for any 20 trading days within a 30 -trading day period. The Company may redeem the entirety of outstanding warrants (except as described with respect to the Private Warrants) at a price of $ 0.10 per warrant, with a minimum 30 days prior written notice of redemption, if t he closing price of the share of Company Common Stock equals or exceeds $ 10.00 per share for any 20 trading days within a 30 -trading day period. If the Company calls the Public Warrants for redemption, as described above, management will have the option to require any holder that wishes to exercise the Public Warrants to do so on a “cashless basis,” as described in the warrant agreement. The exercise price and number of shares of Company Common Stock issuable upon exercise of the Public Warrants may be adjusted in certain circumstances including in the event of a share dividend, extraordinary dividend or recapitalization, reorganization, merger or consolidation. The Public Warrants will not be adjusted for the issuance of shares of Company Common Stock at a price below its exercise price. Additionally, in no event will the Company be required to net cash settle the Public Warrants. The Private Warrants are identical to the Public Warrants except for certain features. The Private Warrants will be exercisable on a cashless basis and be non-redeemable, except as described above, so long as they are held by the initial purchasers or their permitted transferees. If the Private Warrants are held by someone other than the initial purchasers or their permitted transferees, the Private Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants. Further, in accordance with FINRA Rule 5110(g)(8)(A), the Private Warrants purchased by one of the initial purchasers will not be exercisable for more than five years from the effective date of the registration statement filed in connection with the Company’s Initial Public Offering for so long as they are held by such initial purchaser. Fair Value of ZeroFox Holdings, Inc. Public Warrants and Private Warrants The Company analyzed the rights and features of the Public Warrants and Private Warrants to determine the appropriate fair value estimation approach. Both the public and private warrants give the holder the option to purchase one share of Company Common Stock at a strike price of $ 11.50 . The Company's Public Warrants are traded on Nasdaq under the ticker "ZFOXW" providing an observable price for the warrants. Accordingly, the Company uses the closing price of the Public Warrants on the balance sheet date as an indicator of their fair value. Although the Private Warrants are not subject to the same early redemption feature as the Public Warrants and are not publicly traded, the Private Warrants are subject to the same make-whole provisions as the Public Warrants if not held by the initial purchaser or permitted transferee and as such, are considered economically similar to the Public Warrants. As such, the Company uses the same indicator of fair value as the Public Warrants for the Private Warrants. The public closing price for the Company's Public Warrants as of January 31, 2023, was $ 0.16 per warrant, resulting in a fair value of $ 1.4 million and $ 1.2 million for the Public Warrants and Private Warrants, respectively. The public closing price for the Company's Public Warrants as of January 31, 2024, was $ 0.0088 per warrant, resulting in a fair value of $ 0.1 million and $ 0.1 million for the Public Warrants and Private Warrants, respectively. The Company recorded the change in the fair value of both the Public Warrants and Private warrants to change in fair value of warrant liability on the Consolidated Statement of Comprehensive Loss. Stifel Warrant The Company, in connection with the amendment to the loan and security agreement with Stifel Bank on April 21, 2023 (see Note 10), agreed to issue to Stifel Bank a warrant to purchase 128,676 shares of the Company's Common Stock at an exercise price of $ 1.36 (the Stifel Warrant). The Stifel Warrant will expire ten years from the completion of the LookingGlass Acquisition or earlier upon exercise by the holder or acquisition of the Company (subject to the terms of the warrant). Fair Value of Stifel Warrant The fair value of the Stifel Warrant was determined using a Black-Scholes model. The assumptions used in estimating the fair value of the Stifel Warrant are included in the table below. There are no values as of January 31, 2023, as the warrant was issued on April 21, 2023. January 31, 2024 April 21, 2023 Asset price $ 0.88 $ 1.32 Exercise price of the warrant $ 1.36 $ 1.36 Contractual term 9.2 10.0 Volatility 67.50 % 65.00 % Dividend yield 0.00 % 0.00 % Risk-free rate 4.00 % 3.60 % Sponsor Earnout Shares The sponsor and certain directors of L&F agreed, upon closing of the Business Combination, to subject 1,293,750 of their shares (Sponsor Earnout Shares) of Company Common Stock to potential forfeiture if triggering events do not occur during the earnout period. The earnout period begins on the Closing Date of the Business Combination, August 3, 2022 , and extends to the five-year anniversary of the Closing Date. There are three triggers where, upon achievement of the trigger, one third of the Sponsor Earnout Shares are deemed earned and no longer subject to forfeiture. The three triggers are: 1. Triggering event I - the first date on which the volume-weighted average price per share of Company Common Stock is equal to or greater than $ 12.50 for at least 20 days within any 30 consecutive trading days, 2. Triggering event II - the first date on which the volume-weighted average price per share of Company Common Stock is equal to or greater than $ 15.00 for at least 20 days within any 30 consecutive trading days, and 3. Triggering event III - the first date on which the volume-weighted average price per share of Company Common Stock is equal to or greater than $ 17.50 for at least 20 days within any 30 consecutive trading days. In the case of a change of control of the Company, the triggering events above will be considered met if the shareholders of the Company receive cash, securities, or other assets per share that equal or exceed the price targets described above. From the closing date of the Business Combination to January 31, 2024, no triggering events had been achieved. Sponsor Earnout Shares Fair Value The Company performed Monte Carlo simulations to estimate the achievement of each of the triggering events, the volume-weighted average stock price at the estimated time at which the triggering events were achieved, and the duration of time required to achieve the triggering events. From the Monte Carlo results, the Company calculated an average, discounted fair value per share of each of the one-third tranches of Sponsor Earnout Shares subject to potential forfeiture. The table below documents the Monte Carlo assumptions, inputs, and the fair value results at each balance sheet date: January 31, 2024 January 31, 2023 Per Share Price of Company Common Stock $ 0.88 $ 3.62 Annual Equity Volatility 97.50 % 65.00 % Risk-Free Rate of Return 4.01 % 3.70 % Fair Value per Share Tranche I $ 0.33 $ 2.12 Fair Value per Share Tranche II $ 0.30 $ 1.88 Fair Value per Share Tranche III $ 0.28 $ 1.67 Aggregate Fair Value (in thousands) $ 392 $ 2,445 The Company recognized the initial liability of $ 12.1 million as part of the closing of the Business Combination, with an offset to opening retained earnings. The Company recognized the liability as part of the Business Combination as the potential forfeiture mechanism of the Sponsor Earnout Shares only became effective as a direct result of the successful closing of the Business Combination. The Company recorded the change in the fair market value of the Sponsor Earnout Shares to change in fair market value of Sponsor Earnout Shares on the Consolidated Statement of Comprehensive Loss. Purchase Consideration Liability The merger agreement governing the LookingGlass Acquisition (the "LookingGlass Merger Agreement") provides that the selling shareholders are entitled to receive shares of Company Common Stock as part of the purchase consideration. The purchase consideration shares include two components: the LookingGlass Earnout Shares and the LookingGlass Deferred Shares. The purchase consideration shares shall be issued in three or four installments on the six-month, twelve-month, and eighteen-month anniversaries of the transaction closing date (April 21, 2023) and potentially a further issuance on July 31, 2025. During the three months ended October 31, 2023, the Company issued 3,810,108 shares to the selling shareholders in connection with the distribution on the six-month anniversary of the transaction date. The shares issued included a portion of both the LookingGlass Earnout Shares and the LookingGlass Deferred Shares (both are defined below). LookingGlass Earnout Shares The LookingGlass Merger Agreement provides that the selling shareholders are entitled to receive up to 2.0 million shares of Company Common Stock (the LookingGlass Earnout Shares). The earnout period begins on February 1, 2023 . There are four triggers where, upon achievement of the trigger, the LookingGlass Earnout Shares will be earned. The triggers are: 1. Triggering event I - if LookingGlass generates $ 10.0 million in certain bookings (as defined in the LookingGlass Merger Agreement) or renews a specific contract for at least $ 12,680,840 (as defined in the LookingGlass Merger Agreement) on or before January 31, 2024, the LookingGlass Earnout Shares will be fully earned. 2. Triggering event II - if LookingGlass renews a specific contract on or before February 28, 2024, the LookingGlass Earnout Shares will be reduced by 250,000 shares. 3. Triggering event III - if LookingGlass renews a specific contract on or before March 31, 2024, the LookingGlass Earnout Shares will be reduced by 500,000 shares. 4. Triggering event IV - if LookingGlass renews a specific contract on or before April 30, 2024, the LookingGlass Earnout Shares will be reduced by 750,000 shares. During the year ended January 31, 2024, triggering event I was achieved. LookingGlass Earnout Shares Fair Value The fair value of the LookingGlass Earnout Shares includes the shares that have been earned and will be issued on the twelve and eighteen-month anniversaries of the transaction date. The fair value of the LookingGlass Earnout Shares was $ 1.1 million and $ 2.0 million as of January 31, 2024, and April 21, 2023, respectively. The Company recorded the change in the fair market value of the LookingGlass Earnout Shares to change in fair market value of purchase consideration liability on the Consolidated Statement of Comprehensive Loss. LookingGlass Deferred Shares The remaining purchase consideration shares consist of shares that will be issued based on the passage of time (in accordance with the LookingGlass Merger Agreement) as well as a variable amount of shares that will be issued subject to indemnity claims (collectively, the LookingGlass Deferred Shares). The LookingGlass Merger Agreement provides that a variable number of shares of Company Common Stock will be withheld for a period of twelve months and be subject to indemnity claims by the Company, an additional 500,000 shares will be withheld until July 31, 2025, and be subject to certain indemnity claims by the Company. Purchase Consideration Liability Fair Value The Company performed probability-weighted assessments to estimate the variable portion of the LookingGlass Deferred Shares (related to indemnities) that will be issued pursuant to the LookingGlass Merger Agreement. The remaining purchase consideration shares consist of shares that will be issued based on the passage of time according to the LookingGlass Merger Agreement, including the remaining LookingGlass Earnout Shares that have been earned. The purchase consideration shares are remeasured to fair value each reporting date based on the Company's re-assessment of probability weightings related to the variable portion of the LookingGlass Deferred Shares, as well as the price of the Company's Common Stock as reported on Nasdaq. The calculation of the fair value of the purchase consideration liability is included in the table below (in thousands, except share and per share data). There is no balance as of January 31, 2023, as the LookingGlass Business Acquisition occurred on April 21, 2023. January 31, 2024 Purchase consideration shares 8,766,264 Distributed Tranche I purchase consideration shares ( 3,810,108 ) Remaining purchase consideration shares 4,956,156 Closing price per share of the Company's Common Stock (ZFOX) $ 0.88 Fair value of remaining purchase consideration liability $ 4,362 The Company recorded the change in the fair market value of the purchase consideration liability to change in fair market value of purchase consideration liability on the Consolidated Statement of Comprehensive Loss. |
Redeemable Convertible Preferre
Redeemable Convertible Preferred Stock | 7 Months Ended |
Aug. 03, 2022 | |
ID Experts Holdings, Inc. and Subsidiary [Member] | |
Temporary Equity [Line Items] | |
Redeemable Convertible Preferred Stock | 4 : Redeemable Convertible Preferred Stock Series A-1 Redeemable Convertible Preferred Stock On July 29, 2016, the Company’s Board of Directors approved the issuance of up to 6,000,000 shares of Series A-1 preferred stock, par value $ 0.0001 . The original issuance price of the Series A-1 preferred stock was $ 0.85 . Series A-1 preferred stock is recorded at the maximum redemption value per the agreement in redeemable convertible preferred stock. Dividends If a dividend is declared on common stock, the stockholders of Series A-1 preferred stock are entitled to receive an amount equal to the dividend they would receive if the shares were converted to common stock. If a dividend is declared on a class of shares that is not convertible to common stock, the convertible preferred stockholders receive an amount determined by (A) dividing the amount of the dividend payable on each class of stock by the original price of such class and (B) multiplying the fraction by the original issue price of the convertible preferred stock. The convertible preferred stockholders must receive their pro-rata dividends before or concurrent with any dividend payable to common stockholders. No dividends have been approved or declared by the Board of Directors related to the Company’s Series A-1 preferred stock. Liquidation In a liquidation event, excluding a public offering, stockholders of the Series A-1 preferred stock shall receive any declared and unpaid dividends, plus the higher of a liquidation preference of $ 0.85 per share, or the value the stockholders would receive if shares were converted to common stock and Series B preferred stock. Redemption The Series A-1 preferred stock is redeemable at the option of the stockholders seven years after original issuance, which is outside of the Company’s control, and therefore, is classified as temporary equity. The redemption price is the higher of the fair market value of the shares upon conversion to common stock or the original issuance price plus any declared and unpaid dividends. The fair market value of the shares shall not exceed any amount which is greater than two times (2x) the original issue price. Conversion Stockholders may convert their preferred shares into an equal quantity of common stock and Series B preferred stock at their election. In the event of a Qualified IPO, which is defined in the Company’s amended and restated certificate of incorporation as upon the closing of the sale of shares of common stock to the public at a price of $ 2.6325 per share, resulting in at least $ 50.0 million in gross proceeds, the Series A-1 preferred stock automatically convert to common stock and Series B preferred stock. Voting Stockholders of Series A-1 preferred stock are entitled to cast the number of votes equal to the number of whole shares of common stock their preferred shares would convert into as of the record date. Series A-2 Redeemable Convertible Preferred Stock On July 29, 2016, the Company’s Board of Directors approved the issuance of up to 27,000,000 of Series A-2 preferred stock, par value $ 0.0001 . The original issuance price of the Series A-2 preferred stock was $ 1.053 . Series A-2 preferred stock is recorded at the maximum redemption value per the agreement in redeemable convertible preferred stock. Dividends If a dividend is declared on common stock, the stockholders of Series A-2 preferred stock are entitled to receive an amount equal to the dividend they would receive if the shares were converted to common stock. If a dividend is declared on a class of shares that is not convertible to common stock, the convertible preferred stockholders receive an amount determined by (A) dividing the amount of the dividend payable on each class of share by the original price of such class and (B) multiplying the fraction by the original issue price of the convertible preferred stock. The convertible preferred stockholders must receive their pro-rata dividends before or concurrent with any dividend payable to the common stockholders. No dividends have been approved or declared by Board of Directors related to the Company’s convertible Preferred A-2 stock. Liquidation In a liquidation event, excluding a public offering, the stockholders of the Series A-2 preferred stock shall receive any declared and unpaid dividends, plus the higher of a liquidation preference of $ 1.053 per share, or the value the stockholders would receive if shares were converted to common stock and Series B preferred stock. Redemption The Series A-2 preferred stock is redeemable at the option of the stockholders seven years after original issuance. This redemption option is outside of IDX’s control and therefore, IDX classifies the Series A-2 preferred stock as temporary equity in the Consolidated Balance Sheets. The redemption price of the Series A-2 preferred stock is the higher of (i) the fair market value of the shares upon conversion to common stock or (ii) the original issuance price plus any declared and unpaid dividends. The fair market value of the shares shall not exceed any amount which is greater than two times the original issue price. Conversion Stockholders may convert their preferred shares into an equal quantity of common stock and Series B preferred stock at their election. In the event of a Qualified IPO, which is defined in IDX’s amended and restated certificate of incorporation as upon the closing of the sale of shares of common stock to the public at a price of $ 2.6325 per share, resulting in at least $ 50.0 million in gross proceeds, the Series A-2 preferred stock automatically convert to common and Series B preferred stock. Voting Holders of Series A-2 preferred stock are entitled to cast the number of votes equal to the number of whole shares of common stock their preferred shares would convert into as of the record date. |
Common Stock, Redeemable Conver
Common Stock, Redeemable Convertible Preferred Stock, and Stockholders' Equity (Deficit) | 7 Months Ended | 12 Months Ended |
Aug. 03, 2022 | Jan. 31, 2024 | |
Class of Stock [Line Items] | ||
Common Stock, Redeemable Convertible Preferred Stock, and Stockholders' Equity (Deficit) | 12: Common Stock and Stockholders' Equity (Deficit) The authorized capital stock of the Company consists of 1,100,000,000 shares of stock, $ 0.0001 par value per share, of which 1,000,000,000 shares are designated as Common Stock and 100,000,000 shares are designated as Preferred Stock. Common Stock The Company has issued and outstanding 124,639,135 shares of Common Stock as of January 31, 2024. Holders of Common Stock are entitled to one vote for each share. Dividend Rights Subject to the preferences that may apply to any shares of the Company's preferred stock outstanding at the time, the holders of Common Stock will be entitled to receive dividends, out of funds legally available for the payment of dividends, if the Board of Directors, in its discretion, authorizes the issuance of dividends. The Company's Board of Directors has not declared any dividends related to Company Common Stock as of January 31, 2024, and through the date these financial statements were available to be issued. Right to Receive Liquidation Distributions If the Company becomes subject to a liquidation, dissolution, or winding-up, the assets legally available for distribution to the Company’s stockholders would be distributable ratably among the holders of Common Stock and any participating series of the Company’s Preferred stock outstanding at that time, subject to prior satisfaction of all outstanding debt and liabilities and the preferential rights and liquidation preferences of any outstanding shares of the Company's preferred stock. Preferred Stock The Board of Directors of the Company has not issued any classes or series of preferred stock as of January 31, 2024, and through the date these financial statements were available to be issued. The Board of Directors of the Company is authorized, subject to limitations prescribed by law, to issue preferred stock in one or more series, to establish the number of shares to be included in each series, and to fix the designation, powers, preferences, voting power, and conversion rights of the shares of each series without further vote or action by the Company’s stockholders. The Board of Directors is empowered to increase or decrease the number of shares of any series of the Company’s Preferred Stock, but not below the number of shares of that series then outstanding, without any further vote or action by the Company’s stockholders. The Company’s and Predecessor's common stock reserved for future issuance is as follows: January 31, 2024 January 31, 2023 Common stock warrants 16,342,106 16,213,430 Stock options issued and outstanding 6,484,992 7,869,050 Restricted stock units issued and outstanding 10,751,337 2,802,426 Sponsor earn-out shares 1,293,750 1,293,750 Shares available for future grant under the 2022 plan 12,858,387 15,829,510 47,730,572 44,008,166 | |
ID Experts Holdings, Inc. and Subsidiary [Member] | ||
Class of Stock [Line Items] | ||
Common Stock, Redeemable Convertible Preferred Stock, and Stockholders' Equity (Deficit) | 5 : Stockholders’ Deficit Series B Preferred Stock On July 29, 2016, IDX’s Board of Directors approved the issuance of up to 33,000,000 shares of Series B preferred stock with a par value of $ 0.0001 . Stockholders of Series B preferred stock are not entitled to vote and do not have preferential dividend rights. In the event of a liquidation event, excluding a public offering, Stockholders of Series B preferred stock receive, following all preferential distributions made to Series A-1 preferred stock and Series A-2 preferred stock, any declared and unpaid dividends and a liquidation preference of $ 0.361 per share. As of August 3, 2022, no Series B preferred stock was outstanding. Common Stock As of August 3, 2022, the Company had authorized 53,000,000 shares of common stock with a par value of $ 0.0001 . Stockholders of common stock are entitled to one vote per share, to receive dividends, if and when declared by the Board of Directors, and upon liquidation or dissolution, receive a portion of the assets available for distributions to stockholders, subject to preferential amounts owed to stockholders of the Company’s preferred stock. Common stockholders have no preemptive or other subscription rights and there are no redemption or sinking fund provisions with respect to such shares. Common stock is subordinate to preferred stock with respect to dividend rights and rights upon liquidation, winding up, and dissolution of the Company. No dividends have been approved or declared by Board of Directors related to the Company’s common stock. |
Income Taxes
Income Taxes | 7 Months Ended | 12 Months Ended |
Aug. 03, 2022 | Jan. 31, 2024 | |
Income Tax Disclosure [Line Items] | ||
Income Taxes | 1 4: Income Taxes U.S. and foreign components of the loss before income taxes for the year ended January 31, 2024, the Successor Period, and the Predecessor Period, were as follows (in thousands): Successor Predecessor Year ended August 4, 2022 to February 1, 2022 to U.S. loss $ ( 366,162 ) $ ( 734,326 ) $ ( 19,370 ) Foreign income (loss) 2,106 3,157 ( 1,924 ) Total loss before income taxes $ ( 364,056 ) $ ( 731,169 ) $ ( 21,294 ) The provision for consolidated income taxes for the year ended January 31, 2024, the Successor Period, and the Predecessor Period, were as follows (in thousands): Successor Predecessor Year ended August 4, 2022 to February 1, 2022 to Current tax expense Federal $ ( 185 ) $ — $ — Foreign 313 177 106 State and local 627 292 5 755 469 111 Deferred tax expense Federal ( 15,111 ) ( 9,360 ) ( 2,780 ) Foreign — — — State and local ( 3,527 ) ( 2,281 ) ( 911 ) ( 18,638 ) ( 11,641 ) ( 3,691 ) Less: change in valuation allowance 10,137 650 3,691 Net income tax (benefit) expense $ ( 7,746 ) $ ( 10,522 ) $ 111 The reported income tax provision differs from the amount computed by applying the statutory U.S. federal income tax rate to the loss before income taxes due to nondeductible expenses, such as the goodwill impairment, and the impact of state taxes, as well as the change in the valuation allowance. A reconciliation of the statutory US income tax rate to the effective income tax rate for the year ended January 31, 2024, the Successor Period, and the Predecessor Period, as follows: Successor Predecessor Year ended August 4, 2022 to February 1, 2022 to U.S. statutory rate 21.00 % 21.00 % 21.00 % State taxes 0.63 0.21 3.35 Foreign taxes ( 0.09 ) — — Goodwill impairment ( 16.40 ) ( 20.07 ) — Transaction costs — — ( 3.23 ) Fair value adjustments — — ( 2.03 ) Other permanent differences ( 0.27 ) 0.41 ( 1.05 ) Change in valuation allowance ( 2.78 ) ( 0.09 ) ( 17.32 ) Other 0.04 ( 0.02 ) ( 1.24 ) Net income tax expense 2.13 % 1.44 % - 0.52 % Deferred income taxes reflect temporary differences in the recognition of revenue and expenses for income tax reporting and consolidated financial statement purposes. Deferred income taxes as of January 31, 2024, and 2023, consisted of the following (in thousands): January 31, 2024 January 31, 2023 Deferred tax assets: Net operating losses - federal and state $ 54,332 $ 36,057 Research and development expenditures 13,128 4,793 Deferred revenue 1,756 3,019 Interest expense 9,052 2,544 Accruals 1,196 1,240 Capital loss carryforward 1,788 — Credits 2,667 — Stock-based compensation 709 574 Other 665 308 Lease liability 910 204 Depreciation and amortization ( 28 ) 112 Allowance for doubtful accounts 48 35 Charitable contributions 6 3 Total deferred tax assets before valuation allowance 86,229 48,889 Valuation allowance ( 33,702 ) ( 5,720 ) Total deferred tax assets 52,527 43,169 Deferred tax liabilities: Intangible assets ( 52,333 ) ( 61,109 ) Contract acquisition costs ( 2,392 ) ( 3,256 ) Goodwill ( 701 ) ( 258 ) Right-of-use assets ( 862 ) ( 177 ) Other ( 458 ) ( 7 ) Total deferred tax liabilities ( 56,746 ) ( 64,807 ) Net deferred tax liability $ ( 4,219 ) $ ( 21,638 ) The net deferred tax liability is included within Other liabilities on the Company's balance sheet at January 31, 2024 and January 31, 2023. The Company recognizes the tax benefit of a position when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, based on the technical merits of the position. Income tax positions must meet a more-likely-than-not recognition threshold at the effective date to be recognized. At January 31, 2024, the Company recorded gross unrecognized tax benefits of approximately $ 1.8 million, all of which, if recognized, would impact the Company's effective tax rate. Interest and penalties accrued related to uncertain tax positions were $ 0.3 million at January 31, 2024. The Company anticipates a $ 0.1 million decrease in unrecognized tax benefits within the next 12 months from the expiration of statute of limitations. Gross unrecognized tax benefits are i ncluded within Other liabilities on the Company's balance sheet at January 31, 2024 and January 31, 2023. The change in gross unrecognized tax benefits, excluding accrued interest and penalties, were as follows (in thousands): January 31, 2024 January 31, 2023 Balance at beginning of period $ 838 $ — Business Combination — 838 Adjustments to the Business Combination 460 — Business acquisition 472 — Current period adjustments 252 — Settlement with tax authorities ( 80 ) — Statute expirations ( 174 ) — Balance at end of period $ 1,768 $ 838 The Company has established a valuation allowance to offset the portion of its deferred tax assets that will reverse subsequent to the reversal of the Company’s deferred tax liabilities, and certain net operating loss (“NOL”) carryforwards that have separate return limitations. The Company increased the valuation allowance in the current year by $ 28.0 million. The Company will continue to evaluate the realizability of its deferred tax assets. T he following table provides a rollforward of the Company’s valuation allowance for its deferred tax assets (in thousands): January 31, 2024 January 31, 2023 Balance at beginning of period $ 5,720 $ 5,070 Increases to allowance 10,137 650 Increases due to business acquisition 17,845 — Balance at end of period $ 33,702 $ 5,720 The Company had NOL carryforwards available to offset future federal and state taxable income of approximately $ 226.4 million and $ 105.7 million, respectively, as of January 31, 2024. O f the federal NOL carryforwards , $ 75.0 million are subject to expiration between tax years 2033 and 2037 . O f the state NOL carryforwards , $ 70.0 million are subject to expiration in varying amounts beginning tax year 2024. The remaining federal and state NOL carryforwards have no expiration. The NOL carryforwards are subject to an annual limitation under Section 382. The Section 382 limitation will not affect the Company's ability to realize the NOL carryforwards provided the Company has sufficient taxable income, subject to the annual limitation. Any future change in control or ownership resulting from further Section 382 limitations may impact the Company's ability to utilize tax attributes such as NOL carryforwards. Additionally, as discussed in Note 18, the Haveli Merger Agreement was executed on February 6, 2024. However, the future events described in the Haveli Merger Agreement were not considered when determining the realizability of our deferred tax assets as of January 31, 2024. The consummation of the Merger may affect certain of the Company's deferred tax liabilities and deferred tax assets, as well as the realizability of our deferred tax assets. The Company’s federal income tax returns for fiscal year 2020 through fiscal year 2023 remained open under the statute of limitations and are subject to examination by tax authorities. In addition, as of January 31, 2024, the Company had various state income tax returns that remained open under the respective statutes of limitations and are subject to examination by tax authorities. The longest period for which any of the Company’s state income tax returns remained open and subject to examination by tax authorities is for fiscal year 2018 through fiscal year 2023 . The statute of limitations for federal and state income tax returns may be extended upon the utilization of NOL carryforwards. As of January 31, 2024, the Company was not under examination by federal or state tax authorities. | |
ID Experts Holdings, Inc. and Subsidiary [Member] | ||
Income Tax Disclosure [Line Items] | ||
Income Taxes | 6 : Income Taxes The income (loss) before income taxes is solely from domestic sources. The provision for income taxes for the period January 1, 2022, to August 3, 2022, are as follows (in thousands): January 1, 2022, to August 3, 2022 Federal $ 1,645 State 361 Total current tax expense 2,006 Deferred tax benefit: Federal ( 1,129 ) State ( 225 ) Total deferred tax benefit ( 1,354 ) Income tax expense $ 652 The income tax provision differs from the amount computed by applying the statutory federal income tax rate of 21 % to the loss before income tax as a result of the following differences (in thousands): January 1, 2022, to August 3, 2022 Income taxes at statutory rate $ ( 43 ) State income tax, net of federal benefit ( 12 ) Permanent items 4 Non-deductible transaction costs 625 Non-deductible convertible debt and warrant expense 150 Stock-based compensation ( 145 ) Tax credits ( 25 ) Loss of attributes 25 Uncertain tax positions 106 Other ( 21 ) Valuation allowance ( 12 ) Income tax expense $ 652 The key differences resulting in income tax expense that differs from the statutory rate for the period January 1, 2022, to August 3, 2022, relate to the impact of non-deductible transaction costs and convertible debt and warrant expenses offset by the benefit of stock-based compensation. The unrecognized tax benefits for uncertain tax positions were approximately $ 0.8 million as of August 3, 2022. Penalties and interest of $ 0.1 million have been accrued to expense as of August 3, 2022. The uncertain tax positions that are reasonably possible to decrease in the next twelve months are insignificant. As of August 3, 2022, the Company is not currently under examination by tax authorities. |
Accrued Compensation, Accrued E
Accrued Compensation, Accrued Expenses, and Other Current Liabilities | 12 Months Ended |
Jan. 31, 2024 | |
Accrued Expense Details [Line Items] | |
Accrued Compensation, Accrued Expenses, and Other Current Liabilities | 9 : Accrued Compensation, Accrued Expenses, and Other Current Liabilities Accrued compensation, accrued expenses, and other current liabilities as of January 31, 2024 and 2023, consists of the following (in thousands): January 31, 2024 January 31, 2023 Other current liabilities $ 10,521 $ 12,110 Accrued bonuses 3,374 3,893 Accrued commissions 1,988 1,408 Accrued employee compensation 1,243 1,340 Total accrued compensation, accrued expenses, and other current liabilities $ 17,126 $ 18,751 |
Stock-Based Compensation
Stock-Based Compensation | 7 Months Ended | 12 Months Ended |
Aug. 03, 2022 | Jan. 31, 2024 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Stock-Based Compensation | 13: Stock-Based Compensation Conversion of Stock-Based Awards As part of the Business Combination, the Company assumed all of the issued and outstanding options to purchase the Common Stock of ZeroFox, Inc. and IDX and converted them into options to purchase the Company's Common Stock (Company Options). The number of Company Options issued along with the associated strike prices were converted using the Exchange Ratios of the Business Combination (see Note 5). The Company issued options to purchase a total of 8,159,377 shares of the Company's Common Stock, 6,380,458 going to holders of options to purchase ZeroFox, Inc. common stock and 1,778,919 going to holders of options to purchase IDX common stock. The vesting schedules, remaining term, and provisions (other than the adjusted number of underlying shares and exercise prices) of the Company Options issued, are identical to the vesting schedules, remaining term, and other provisions of the ZeroFox, Inc. and IDX options that were converted. The conversion did not adjust vesting conditions of the options and did not require the Company to change the classification of the options. The Company recognized no incremental compensation cost as a result of the conversion. The Company recognized stock-based compensation expense based on the estimated fair value of the awards as calculated on their respective grant dates. The Company issued no stock options from the Closing Date of the Business Combination to January 31, 2024. ZeroFox Holdings, Inc. 2022 Incentive Equity Plan On August 3, 2022, the Company adopted the 2022 ZeroFox Holdings, Inc. Incentive Equity Plan (the 2022 Plan). The 2022 Plan became effective on the closing of the Business Combination, which also occurred on August 3, 2022. The 2022 Plan provides for the issuance of up to 11,750,135 shares of Common Stock to employees, officers, directors, consultants, and advisors in the form of stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards (RSUs), dividend equivalents, and other stock or cash-based awards. On November 28, 2023, an d November 30, 2022, the Board of Directors approved an increase to the number of shares available for issuance under the 2022 plan, effective January 1, 2024, and 2023. Pursuant to the terms of the 2022 Plan agreement, the shares available for issuance increased by 5 % of the shares of Common Stock issued and outstanding at December 31, 2023, and 2022, or 6,228,005 shares and 5,909,396 shares, respectively. As of January 31, 2024, there were 12,858,387 shares of Common Stock available for issuance under the 2022 Plan. Stock-based awards are granted at exercise prices not less than 100 % of the fair value of the stock at the date of grant. The Company determines fair value as the closing per share price of its Common Stock on the date the stock-based award is granted. The term of any stock-based award issued under the 2022 Plan may not exceed 10 years from the date of grant. The Company intends to issue new shares to satisfy share options upon exercise. ZeroFox Holdings, Inc. Employee Stock Purchase Plan On August 3, 2022, the Company adopted the ZeroFox Holdings, Inc. 2022 Employee Stock Purchase Plan (ESPP). The ESPP is designed to allow eligible employees of the Company and its subsidiaries to purchase shares of Company Common Stock with their accumulated payroll deductions. As of January 31, 2023, and through the date these financial statements were available to be issued, the Company had not implemented and made available the ESPP to its employees. Stock Options The Company estimates the fair value of stock options on the date of grant using the Black-Scholes option pricing model. The Black-Scholes option pricing model requires estimates of highly subjective assumptions, which affect the fair value of each stock option. As the Company did no t issue any stock options from the Closing Date of the Business Combination to January 31, 2024, this section describes how any such stock-based awards will be fair valued by the Company when they are issued. This section also describes how the Predecessor valued their stock-based awards. Expected Volatility As the Company does not have a significant trading history of the shares of its Common Stock to date, the expected volatility will be based on the average historical stock price volatility of comparable publicly-traded companies in its industry peer group, financial, and market capitalization data. The Predecessor utilized the same estimation approach. Expected Term The expected term of the Company’s options represents the period that the stock-based awards are expected to be outstanding. The Predecessor utilized the same estimation approach. The Company will estimate the expected term of its employee awards using the SAB Topic 14 Simplified Method allowed by the FASB and SEC, for calculating expected term as it has limited historical exercise data to provide a reasonable basis upon which to otherwise estimate expected term. The Predecessor Companies utilized the same estimation approach. Certain of the Predecessor Companies' options began vesting prior to the grant date, in which case the Predecessor used the remaining vesting term at the grant date in the expected term calculation. Risk-Free Interest Rate The Company will estimate its risk-free interest rate by using the yield on actively traded non-inflation-indexed U.S. treasury securities with contract maturities equal to the expected term. The Predecessor utilized the same estimation approach. Dividend Yield The Company has neither declared nor paid dividends to date and does not anticipate declaring dividends. As such, the dividend yield will be estimated to be zero. The Predecessor utilized the same estimation approach. Fair Value of Underlying Common Stock The Company will use the closing price of its Common Stock (ZFOX) on the grant date of the stock-based award to represent the fair value of the underlying Common Stock. The Predecessor's common stock was not publicly traded. As a result, the Predecessor was required to estimate the fair value of their common stock. The Board of Directors of the Predecessor considered numerous objective and subjective factors to determine the fair value of the Predecessor’s common stock at each meeting in which awards are approved. The factors considered included, but were not limited to: (i) the results of contemporaneous independent third-party valuations of the Predecessor’s common stock; (ii) the prices, rights, preferences, and privileges of the Predecessor’s series of Preferred Stock relative to those of its common stock; (iii) the lack of marketability of the Predecessor’s common stock; (iv) actual operating and financial results of the Predecessor; (v) current business conditions and projections; (vi) the likelihood of achieving a liquidity event for the Predecessor, such as an initial public offering or sale of the Predecessor, given prevailing market conditions; and (vii) precedent transactions involving the respective Predecessor's shares. A summary of option activity for the Successor Period and the Predecessor Period, is as follows (Aggregate Intrinsic Value in thousands): Successor Shares Weighted- Weighted- Aggregate Outstanding as of January 31, 2023 7,869,050 $ 1.5454 6.07 $ 16,325 Granted — — Exercised ( 1,003,474 ) 0.2565 Cancelled ( 380,584 ) 4.0963 Outstanding as of January 31, 2024 6,484,992 1.5856 4.96 1,131 Vested as of January 31, 2024 5,814,238 1.2651 4.67 1,055 Vested and expected to vest as 6,250,237 $ 1.4812 4.86 $ 1,104 Successor Shares Weighted- Weighted- Aggregate Outstanding as of August 4, 2022 8,159,377 $ 1.5360 6.01 $ 17,004 Granted — — Exercised ( 206,476 ) 0.5952 Cancelled ( 83,851 ) 2.9681 Outstanding as of January 31, 2023 7,869,050 1.5454 6.07 16,325 Vested as of January 31, 2023 5,772,232 0.9591 5.39 15,359 Vested and expected to vest as 7,135,156 $ 1.3793 5.88 $ 15,987 Predecessor Shares Weighted- Weighted- Aggregate Outstanding as of February 1, 2022 21,715,815 $ 0.4398 6.28 $ 51,688 Granted 1,214,500 2.3920 Exercised ( 392,450 ) 0.2659 Cancelled ( 252,159 ) 1.4633 Outstanding as of August 3, 2022 22,285,706 0.5377 6.45 50,864 Vested as of August 3, 2022 14,783,495 0.2660 5.41 37,757 Vested and expected to vest as 19,659,894 $ 0.4662 6.17 $ 46,276 The Company did no t grant any options during the year ended January 31, 2024, or the Successor Period. The weighted-average grant-date fair value of options granted during the Predecessor Period was $ 1.00 . The total intrinsic value of options exercised during the year ended January 31, 2024, and Successor Period was $ 1.5 million and $ 0.6 million, respectively. The total intrinsic value of options exercised during the Predecessor Period was $ 1.0 million . Restricted Stock Units ("RSUs") The fair value of RSUs is based on the closing price of our Common Stock on the date of grant. The Predecessor did no t grant RSUs during the Predecessor Period. A summary of RSU activity for the Successor Period is as follows: Shares Weighted-Average Outstanding as of January 31, 2023 2,802,426 $ 4.64 Granted 10,038,454 $ 1.29 Vested ( 1,635,418 ) $ 3.29 Cancelled ( 454,125 ) $ 2.98 Outstanding as of January 31, 2024 10,751,337 $ 1.79 Shares Weighted-Average Outstanding as of August 4, 2022 — $ — Granted 2,827,426 $ 4.64 Vested — $ — Cancelled ( 25,000 ) $ 4.63 Outstanding as of January 31, 2023 2,802,426 $ 4.64 RSUs granted under our stock incentive plans generally vest over a period of one to four years . The Company's outstanding RSUs vest upon the satisfaction of a service-based vesting condition. Stock-Based Compensation Expense The Company recognized non-cash, stock-based compensation expense in the accompanying Consolidated Statements of Comprehensive Loss for the year ended January 31, 2024, the Successor Period, and the Predecessor Period, as follows (in thousands): Successor Predecessor Year ended August 4, 2022 to February 1, 2022 to Cost of revenue - subscription $ 219 $ 97 $ 18 Cost of revenue - services 111 36 2 Research and development 1,637 452 114 Sales and marketing 1,612 518 218 General and administrative 3,946 1,397 510 Total stock-based compensation expense $ 7,525 $ 2,500 $ 862 Unrecognized compensation cost related to outstanding stock options totaled $ 1.7 million as of January 31, 2024, which is expected to be recognized over a weighted-average remaining period of 1 . 7 years. Unrecognized compensation cost related to outstanding RSUs totaled $ 16.6 million as of January 31, 2024, which is expected to be recognized over a weighted-average remaining period of 3.0 years. | |
ID Experts Holdings, Inc. and Subsidiary [Member] | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Stock-Based Compensation | 7 : Stock Incentive Plan In August 2016, the Company adopted the 2016 Equity Incentive Plan (the “2016 Plan”) in which incentive equity awards were authorized to be issued to key employees, officers, directors, and consultants of the Company. Under the terms of the 2016 Plan a maximum of 6,287,732 shares of common stock are available for issuance. The Company may grant shares of common stock in the form of incentive stock options, nonqualified stock options, restricted stock grants, non-restricted stock grants or restricted stock units. Options granted under the 2016 Plan have a term of ten years and vest over a period of up to 48 months , subject to modification by the Board of Directors. The exercise price of the options may not be granted at a price less than 100 % of the fair value of the common stock on the date of grant. In August 2017, the Company terminated the 2016 Plan and all shares available for issuance were rolled into the 2017 Equity Incentive Plan (the "2017 Plan"). As of August 3, 2022, there were 265,000 awards outstanding and no shares available for issuance under the 2016 Plan. In August 2017, the Company adopted the 2017 Plan in which incentive equity awards were authorized to be issued to key employees, officers, directors, and consultants of the Company. Under the terms of the 2017 Plan a maximum of 8,785,330 shares of common stock are available for issuance and future cancellations and forfeitures from the 2016 Plan role into the available pool automatically. The Company may grant shares of common stock in the form of incentive stock options, nonqualified stock options, restricted stock grants, non-restricted stock grants or restricted stock units. Options granted under the 2017 Plan have a term of ten years and vest over a period of up to 60 months , subject to modification by the Board of Directors. The exercise price of the options may not be granted at a price less than 100 % of the fair value of the common stock on the date of grant. As of August 3, 2022, there were 2,313,442 awards outstanding and 299,217 shares available for issuance under the 2017 Plan. The Company recognized stock-based compensation in general and administrative expenses in the Consolidated Statements of Income. The amount of stock-based compensation expense the Company recognized was negligible for all periods presented. As of August 3, 2022, there was a negligible amount of future compensation that will be recognized from the remaining periods in 2022 through 2026. Stock-based compensation expense is expected to be recognized over a weighted average period of 3.06 years. The grant-date fair value of each option award is estimated on the date of grant using the Black-Scholes-Merton option pricing model. The weighted average grant date fair value of options granted during the period January 1, 2022, to August 3, 2022, was $ 1.97 . The Company uses a simplified method to estimate the expected term of the options. The Company utilizes a divided yield rate of 0 % as it does not expect to issue dividends. Since the Company’s shares are not publicly traded, expected volatility is estimated based on the average historical volatility of similar entities with publicly traded shares. The risk-free rate for the expected term of the option is based on the U.S. Treasury yield curve at the date of grant. The weighted average assumptions for the period January 1, 2022, to August 3, 2022, grants are as follows: Assumptions January 1, 2022, to August 3, 2022 Weighted-average risk-free rate 2.20 % Weighted-average expected term of the option (in years) 7.0 Weighted-average expected volatility 35.00 % Weighted-average dividend yield 0.00 % Stock option activity during the period January 1, 2022, to August 3, 2022, is as follows: (Aggregate Intrinsic Value in thousands) Shares Weighted- Weighted- Aggregate Outstanding as of January 1, 2022 2,843,372 $ 0.14 7.3 $ 5,768 Granted 72,500 1.97 Exercised ( 272,766 ) 0.04 Cancelled ( 62,424 ) 0.38 Outstanding as of August 3, 2022 2,580,682 $ 0.20 6.5 $ 11,998 Vested as of August 3, 2022 1,556,944 $ 0.17 5.3 $ 7,300 The weighted average grant date fair value of options exercised during the period January 1, 2022, to August 3, 2022, was $ 0.04 . The intrinsic value of options exercised during the period January 1, 2022, to August 3, 2022, was $ 1.3 million. The fair value of shares vested during the period January 1, 2022, to August 3, 2022, was $ 1.4 million. |
Net Loss per Share Attributable
Net Loss per Share Attributable to Common Stockholders/Earnings (Loss) per Share | 7 Months Ended | 12 Months Ended |
Aug. 03, 2022 | Jan. 31, 2024 | |
Earnings (Loss) per Share [Line Items] | ||
Net Loss per Share Attributable to Common Stockholders/Earnings (Loss) per Share | 17: Net Loss per Share Attributable to Common Stockholders The Company follows the two-class method when computing net loss per share of common stock because it has issued securities, other than common stock, that contractually entitle the holders to participate in dividends and earnings. These participating securities include the Company’s restricted common stock, which has non- forfeitable rights to participate in any dividends declared on the Company’s common stock. The two-class method requires all earnings for the period to be allocated between common stock and participating securities based upon their respective rights to receive distributed and undistributed earnings. Under the two-class method, for periods with net income, basic net income per share of common stock is calculated by dividing the net income attributable to common stockholders by the weighted average number of shares of common stock outstanding during the period. Net income attributable to common stockholders is calculated by subtracting from net income the portion of current year earnings that the participating securities would have been entitled to receive pursuant to their dividend rights had all of the year’s earnings been distributed. No such adjustment to earnings is made during periods with a net loss, as the holders of the participating securities have no obligation to fund losses. Diluted net income per share of common stock is computed under the two-class method by using the weighted average number of shares of common stock outstanding plus, for periods with net income attributable to common stockholders, the potential dilutive effects of unvested restricted stock, stock options, warrants, and preferred stock. Due to net losses for the year ended January 31, 2024, the Successor Period, and the Predecessor Period, basic and diluted net loss per share were the same, as the effect of potentially dilutive securities would have been anti-dilutive to the calculation of net loss per share. The following table sets forth computation of basic loss per share attributable to common stockholders (in thousands, except share and per share data): Successor Predecessor Year Ended January 31, 2024 August 3, 2022 to February 1, 2022 to August 3, 2022 Numerator: Net loss $ ( 356,310 ) $ ( 720,647 ) $ ( 21,405 ) Net loss per share attributable to common $ ( 356,310 ) $ ( 720,647 ) $ ( 21,405 ) Denominator: Weighted-average common stock outstanding 123,813,143 116,862,277 43,041,209 Net loss per share attributable to common stockholders $ ( 2.88 ) $ ( 6.17 ) $ ( 0.50 ) The following potentially dilutive securities were not included in the calculation of weighted average common shares outstanding, as their effects would have been anti-dilutive for the year ended January 31, 2024, the Successor Period, and the Predecessor Period. Successor Predecessor Year ended January 31, 2024 August 4, 2022 to February 1, 2022 to Preferred stock (on an as-converted basis) Series Seed redeemable convertible preferred stock — — 18,396,744 Series A redeemable convertible preferred stock — — 31,994,570 Series B redeemable convertible preferred stock — — 53,829,898 Series C redeemable convertible preferred stock — — 42,249,398 Series C-1 redeemable convertible preferred stock — — 22,790,767 Series D redeemable convertible preferred stock — — 27,743,094 Series D-1 redeemable convertible preferred stock — — 11,756,606 Series D-2 redeemable convertible preferred stock — — 1,987,736 Series E redeemable convertible preferred stock — — 30,490,064 Total common stock reserved — — 241,238,877 Common stock Purchase consideration liability shares 1,354,411 — — Sponsor earn-out shares 1,293,750 1,293,750 — Total common stock 2,648,161 1,293,750 — Warrants Common stock warrants 16,314,256 16,220,756 1,924,790 Series A redeemable convertible preferred stock warrants — — 249,806 Series B redeemable convertible preferred stock warrants — — 292,682 Series C-1 redeemable convertible preferred stock warrants — — 1,247,369 Series E redeemable convertible preferred stock warrants — — 2,079,870 Total warrants 16,314,256 16,220,756 5,794,517 Options to purchase common stock Issued and outstanding 6,917,053 7,926,307 22,178,814 Restricted stock units Issued and outstanding 8,013,568 747,405 — | |
ID Experts Holdings, Inc. and Subsidiary [Member] | ||
Earnings (Loss) per Share [Line Items] | ||
Net Loss per Share Attributable to Common Stockholders/Earnings (Loss) per Share | 8 : Earnings (Loss) per Share Earnings (loss) Per Share (EPS) is calculated under the two-class method under which all earnings (distributed and undistributed) are allocated to each class of common stock and participating securities based on their respective rights to receive dividends. Series A-1 and A-2 preferred stock are entitled to receive nonforfeitable dividends equivalent to the dividends paid to the holders of common stock; the preferred shares meet the definition of participating securities. The following table present the calculations of basic and diluted EPS for the period January 1, 2022, to August 3, 2022, (in thousands, except per share data): January 1, 2022, to August 3, 2022 Net income (loss) applicable to common equity $ ( 857 ) Less: undistributed earnings allocated to participating securities — Net income (loss) applicable to common stockholders $ ( 857 ) Total weighted-average common shares outstanding 12,854,967 Net income (loss) per share, basic and diluted $ ( 0.07 ) |
Related Party Transactions
Related Party Transactions | 7 Months Ended | 12 Months Ended |
Aug. 03, 2022 | Jan. 31, 2024 | |
Related Party Transaction [Line Items] | ||
Related Party Transactions | 15: Related Party Transactions Baltimore Headquarters Lease The Company leases office space in Baltimore, Maryland. The lessor is owned and operated by the Company’s chief executive officer. The lease expired on February 28, 2023, and the Company continued to lease the facility on a month-to-month basis. On April 21, 2023, the lease agreement was amended to extend the lease for an additional three-year term through February 28, 2026. The Company incurred rent expense of $ 0.4 million during the year ended January 31, 2024. The Company incurred rent expense of $ 0.2 million during the Successor Period and the Predecessor incurred rent expense of $ 0.2 million during the Predecessor Period. As of January 31, 2024, and January 31, 2023, the Company had leasehold improvements of $ 0.1 million, net of accumulated depreciation of $ 0.1 million. The lessor holds a $ 0.1 million security deposit that is refundable at the end of the lease term. PIPE Investors Notes The Predecessor accrued $ 0.2 million of payment-in-kind (PIK) interest for notes payable with related parties during the Predecessor Period. The interest accrued through the date of the Business Combination was paid in cash to the note holders on the date of the Business Combination. The principal value of the related notes owed by the Predecessor of $ 5.0 million was offset against obligations the note holders had with the Company as part of the PIPE Subscription Agreement. | |
ID Experts Holdings, Inc. and Subsidiary [Member] | ||
Related Party Transaction [Line Items] | ||
Related Party Transactions | 9 : Related Party Transactions The Company has a convertible debt loan due to several stockholders. The Company did not pay any loan fees or interest on the convertible debt loan to its stockholders for the period January 1, 2022, to August 3, 2022. Additionally, the Company recognized $ 0.6 million in revenue from contracts with affiliates of minority stockholders and recognized $ 0.1 million in expense from contracts with affiliates of majority stockholders during the period January 1, 2022, to August 3, 2022. For the period January 1, 2022, to August 3, 2022, expense of $ 0.1 million was recorded in cost of services in the Consolidated Statements of Income. |
Commitments and Contingencies
Commitments and Contingencies | 7 Months Ended | 12 Months Ended |
Aug. 03, 2022 | Jan. 31, 2024 | |
Commitments and Contingencies Disclosure [Line Items] | ||
Commitments and Contingencies | 16: Commitments and Contingencies Sales and Other Taxes The Company’s cloud solutions and services are subject to sales and other taxes in certain jurisdictions where the Company does business. The Company bills sales and other taxes to customers and remits these to the respective government authorities. Taxing jurisdictions have differing rules and regulations, which are subject to varying interpretations that may change over time. There may be assessments for sales tax jurisdictions in which the Company has not accrued a sales tax liability. The Company has been unable to assess the probability, or estimate the amount, of this exposure. There were no pending reviews as of January 31, 2024. Prior to January 1, 2022, IDX did not collect U.S. sales and use tax from its customers for its services. During 2020, IDX engaged an external tax consultant to perform a full U.S. sales tax nexus study and analysis. IDX accrued and reflected historical liabilities in its financial statements and was filing Voluntary Disclosure Agreements (VDA) in relevant U.S. jurisdictions. Beginning January 1, 2022, IDX began collecting, reporting, and remitting appropriate U.S. sales tax from its customers in all applicable jurisdictio ns. As of January 31, 2024, the Company recorded an accrual of $ 1.3 million for IDX sales and use taxes that were not remitted prior to January 31, 2022. As of January 31, 2023, the Company recorded an accrual of $ 1.5 million for IDX sales and use taxes that were not remitted prior to January 31, 2022. Employee Benefit Plan The Predecessor’s 401(k) plan (the “Predecessor's 401(k) Plan”) was established in 2014 to provide retirement and incidental benefits for its employees. As allowed under Section 401(k) of the Internal Revenue Code, the Predecessor's 401(k) Plan provides tax-deferred salary deductions for eligible employees. Contributions to the Predecessor's 401(k) Plan are limited to a maximum amount as set periodically by the Internal Revenue Service. To date, the Company has not made any contributions to the Predecessor's 401(k) Plan. The Company maintains two separate defined contribution 401(k) plan for legacy IDX and LookingGlass employees. Employees meeting certain requirements are eligible to participate to the respective plan. Under both plans, eligible participants may contribute a portion of their compensation to the plan and the Company may make matching contributions. The Company may make discretionary contributions to each plan at its option. The Company contributed $ 0.4 million and $ 0.1 million to the plan during the year ended January 31, 2024 and the Successor Period, respectively. General Litigation In the ordinary course of business, the Company is involved in various disputes. In the opinion of management, the amount of liability, if any, resulting from the final resolution of these matters will not have a material impact on the Company’s consolidated financial position, results of operations, or cash flows. The Company was not involved in any pending litigation as of January 31, 2024. Warranties and Indemnification The Company’s enterprise cloud platform is typically warranted to perform in a manner consistent with general industry standards that are reasonably applicable and materially in accordance with the Company’s online help documentation under normal use and circumstances. The Company’s arrangements generally include certain provisions for indemnifying customers against liabilities if its services infringe a third-party’s intellectual property rights. To date, the Company has not incurred any material costs because of such obligations and has not accrued any liabilities related to such obligations in the accompanying consolidated financial statements. The Company has also agreed to indemnify its directors and executive officers for costs associated with any fees, expenses, judgments, fines, and settlement amounts incurred by any of these persons in any action or proceeding to which any of those persons is, or is threatened to be, made a party by reason of the person’s service as a director or officer, including any action by the Company, arising out of that person’s services as the Company’s director or officer or that person’s services provided to any other company or enterprise at the Company’s request. The Company maintains director and officer insurance coverage that would generally enable the Company to recover a portion of any future amounts paid. The Company may also be subject to indemnification obligations by law with respect to the actions of its employees under certain circumstances and in certain jurisdictions. Purchase Commitments The Company has a non-cancelable purchase commitment of $ 72.4 million related to 17 months of outsourced credit monitoring services provided to the Company’s largest customer as of January 31, 2024. The dollar amount and length of this commitment is determined by the customer’s exercise of annual option periods. | |
ID Experts Holdings, Inc. and Subsidiary [Member] | ||
Commitments and Contingencies Disclosure [Line Items] | ||
Commitments and Contingencies | 1 0. Commitments and Contingencies From time to time, the Company may become involved in routine litigation arising in the ordinary course of business. While the results of such litigation cannot be predicted with certainty, management believes that the final outcome of such matters is not likely to have a material effect on the Company’s financial position, results of operations, or cash flows. The Company has entered into a non-cancelable purchase commitment of $ 58.9 million related to eleven months of outsourced credit monitoring services provided to the Company’s largest customer as of August 3, 2022. The amount and duration of this commitment is determined by the customer’s exercise of annual option periods. |
Subsequent Events
Subsequent Events | 7 Months Ended | 12 Months Ended |
Aug. 03, 2022 | Jan. 31, 2024 | |
Subsequent Event [Line Items] | ||
Subsequent Events | 1 8: Subsequent Events Haveli Merger Agreement On February 6, 2024, the Company entered into an Agreement and Plan of Merger (the "Haveli Merger Agreement") with ZI Intermediate II, Inc., a Delaware corporation (“Parent”) and HI Optimus Merger Sub, Inc., a Delaware corporation and a wholly-owned subsidiary of Parent (“Merger Sub”), pursuant to which, if all of the conditions to closing are satisfied or, if permitted, waived, the Company will become a wholly-owned subsidiary of Parent (the “Merger”). Parent and Merger Sub are affiliates of Haveli Investments Software Fund I, L.P. (“Haveli Software”) and Haveli Investments Software Fund I Cayman L.P. (“Haveli Cayman” and, together with Haveli Software, the “Haveli Funds”), funds managed by Haveli Investments L.P. (“Haveli”). The Haveli Merger Agreement provides that, among other things and on the terms and subject to the conditions of the Haveli Merger Agreement, (a) Merger Sub will merge with and into the Company, with the Company surviving the Merger as a wholly-owned subsidiary of Parent (the “Merger”), and (b) at the effective time of the Merger (the “Effective Time”), each issued and outstanding share (immediately prior to the Effective Time) of common stock of the Company, par value $ 0.0001 per share (the “Company Common Stock”) (except as otherwise provided in the Haveli Merger Agreement) will be cancelled and converted into the right to receive an amount in cash equal to $ 1.14 per share ("the Merger Consideration"), without interest and subject to any applicable withholding taxes. The Merger, which has been unanimously approved by the Company’s board of directors (the “Board”), is expected to close in the first half of 2024. Upon consummation of the Merger, the Company will cease to be a publicly traded company and the Company Common Stock and the Company’s public warrants will be delisted from The Nasdaq Global Market and The Nasdaq Capital Market, respectively. The completion of the Merger is subject to the satisfaction or, if permitted, waiver of certain customary mutual closing conditions set forth in the Haveli Merger Agreement, including (a) the adoption of the Haveli Merger Agreement by the affirmative vote of holders of a majority of the outstanding shares of Company Common Stock (the “Company Stockholder Approval”) and (b) the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the receipt of approval, clearance or expiration of the applicable review periods under the United Kingdom’s National Security and Investment Act 2021, as amended. The obligation of each party to consummate the Merger is also conditioned on, among other things, the other party’s representations and warranties being true and correct (subject to certain customary materiality exceptions) and the other party having performed in all material respects its obligations under the Haveli Merger Agreement, and the obligation of Parent to consummate the Merger is additionally conditioned on no material adverse effect on the Company having occurred since the execution of the Haveli Merger Agreement that is continuing. The consummation of the Merger is not subject to any financing condition. The Haveli Merger Agreement contains termination rights for each of the Company and Parent, including, among others, (1) if the consummation of the Merger does not occur on or before August 6, 2024 (subject to extension until November 6, 2024 under specified circumstances), (2) if the Company Stockholder Approval is not obtained following the meeting of the Company’s stockholders for purposes of obtaining such Company Stockholder Approval and (3) subject to certain conditions, (a) by Parent if the Board changes its recommendation in favor of the Merger or (b) by the Company in connection with the entry into a definitive agreement with respect to a Superior Proposal (as defined in the Haveli Merger Agreement). The Company and Parent may also terminate the Haveli Merger Agreement by mutual written consent. The Company is required to pay Parent a termination fee of $ 5,261,750 in cash upon termination of the Haveli Merger Agreement under specified circumstances, including, among others, termination by Parent in the event that the Board changes its recommendation in favor of the Merger or termination by the Company to enter into an agreement in connection with a Superior Proposal. The Haveli Merger Agreement also provides that a reverse termination fee of $ 10,000,000 will be payable by Parent to the Company under specified circumstances, including, among others, if (1) Parent fails to consummate the Merger following satisfaction or waiver of certain closing conditions and the Company’s irrevocable confirmation that it is ready, willing and able to consummate the closing or (2) Parent otherwise breaches its obligations under the Haveli Merger Agreement such that there is a failure of certain conditions to the Merger. Parent has obtained equity and debt financing commitments for the purpose of financing the transactions contemplated by the Haveli Merger Agreement. Other terms of Haveli Merger Agreement Below is a summary of the effect of other terms of the Haveli Merger agreement on certain financial instruments at the Effective Time. Warrants Each Public and Private Warrant that is unexercised and outstanding immediately prior to the Effective Time will cease to represent a warrant to purchase shares of Company Common Stock. Instead the instrument will represent, upon any subsequent exercise, a right to receive the Merger Consideration. If holders properly exercise their warrants within 30 days following the public disclosure of the closing of the Merger by the Company pursuant to a current report on Form 8-K filed with the SEC, the exercise price of their warrants shall be adjusted as provided in Section 4.4 of the warrant agreement dated November 23, 2020 between L&F and Continental Stock Transfer & Trust Company. The Stifel Warrant will automatically terminate and be cancelled such that no consideration will be payable. Accordingly, the liability for the fair value of the Stifel Warrant will be extinguished. Stock Options Each stock option that is vested in accordance with its terms and outstanding immediately prior to the Effective Time will be deemed exercised on a cashless basis and exchanged for the right to receive cash proceeds, without interest and subject to applicable withholding taxes. The amount of cash proceeds is equal to the excess of the Merger Consideration over the exercise price of the vested stock option, for each vested stock option. If the exercise price of the vested stock option is greater than or equal to the Merger Consideration, the vested stock option is cancelled with no consideration payable. Each stock option that is unvested and outstanding immediately prior to the Effective Time will be converted into the contingent right to receive cash proceeds, without interest and subject to applicable withholding taxes. The amount of cash proceeds is equal to the excess of the Merger Consideration over the exercise price of the unvested stock option, for each unvested stock option. If the exercise price of the unvested stock option is greater than or equal to the Merger Consideration, the unvested stock option is cancelled with no consideration payable. The cash consideration (converted from an unvested stock option) will vest and become payable at the same time as the original Company stock option would have vested and been payable pursuant to its terms and shall otherwise remain subject to substantially the same terms and conditions that were applicable to the original Company stock option immediately prior to the Effective Time. Restricted Stock Units ("RSUs") Each RSU that is outstanding immediately prior to the Effective Time and that is either held by a non-employee member of the Board or vested in accordance with its terms as of the Effective Time will be cancelled and converted into the right to receive cash proceeds, without interest and subject to applicable withholding taxes. The amount of cash proceeds is equal to the Merger Consideration for each RSU. Each RSU that is outstanding immediately prior to the Effective Time and that is either not held by a non-employee member of the Board or not vested will be converted into the contingent right to receive cash proceeds, without interest and subject to applicable withholding taxes. The amount of cash proceeds is equal to the Merger Consideration for each RSU. The cash consideration (converted from an unvested RSU) will vest and become payable at the same time as the original RSU would have vested and been payable pursuant to its terms and shall otherwise remain subject to substantially the same terms and conditions that were applicable immediately prior to the Effective Time. Sponsor Earnout Shares The sponsor earnout shares will be forfeited and cease to exist. Accordingly, the liability for the fair value of the Sponsor Earn Shares will be extinguished. Purchase Consideration Liability The purchase consideration shares to be issued under the terms of the LookingGlass Merger Agreement will remain issuable. The Haveli Merger Agreement specifies that 5,558,552 shares of Common Stock are the maximum number of shares that remain issuable in any circumstance under the terms of the LookingGlass Merger Agreement. Convertible Notes As the transaction qualifies as Fundamental Change (as defined in the indenture governing the Convertible Notes), each holder of a Note will have the right to cause the Company to repurchase for cash all or a portion of the Convertible Notes held by such holder, at a price equal to 100 % of the principal plus accrued and unpaid interest, plus any remaining amounts that would be owed to, but excluding, the maturity date. In the event of a conversion in connection with a Fundamental Change, the conversion price will be adjusted in accordance with a Fundamental Change make-whole table. The foregoing summary of the Haveli Merger Agreement and the transactions contemplated thereby does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the Haveli Merger Agreement, which is filed as Exhibit 2.1 of the Company’s Current Report on Form 8-K filed on February 6, 2024 and included as Exhibit 2.02 to this Annual Report on Form 10-K. In connection with the Merger, the Company expects to incur significant expenses, such as transaction, professional services, and other costs. An estimate of these expenses cannot be made at this time. Convertible Note Repurchase Agreements On February 6, 2024, the Company and funds managed by Monarch Alternative Capital LP (collectively, the “Monarch Noteholders”) entered into note repurchase agreements pursuant to which the Monarch Noteholders have agreed to sell and the Company has agreed to repurchase substantially concurrent with the Merger an aggregate principal amount of approximately $ 135.0 million of the Convertible Notes and any additional Convertible Notes acquired by the Monarch Noteholders at a purchase price equal to the entire aggregate principal amount of the Convertible Notes repurchased plus accrued and unpaid interest, if any, thereon to, but excluding, the repurchase date. On February 21, 2024, the Company and L&F Acquisition Holdings Fund, LLC (the “L&F Noteholder”) entered into a note repurchase agreement pursuant to which the L&F Noteholder has agreed to sell and the Company has agreed to repurchase substantially concurrent with the Merger an aggregate principal amount of approximately $ 8.4 million of the Convertible Notes and any additional Convertible Notes acquired by the L&F Noteholder at a purchase price equal to the entire aggregate principal amount of the Convertible Notes repurchased plus accrued and unpaid interest, if any, thereon to, but excluding, the repurchase date. On March 4, 2024, the Company and Corbin ERISA Opportunity Fund, Ltd. (the “Corbin Noteholder”) entered into note a repurchase agreement pursuant to which the Corbin Noteholder has agreed to sell and the Company has agreed to repurchase substantially concurrent with the Merger an aggregate principal amount of approximately $ 25.3 million of the Convertible Notes and any additional Convertible Notes acquired by the Corbin Noteholder at a purchase price equal to the entire aggregate principal amount of the Convertible Notes repurchased plus accrued and unpaid interest, if any, thereon to, but excluding, the repurchase date. | |
ID Experts Holdings, Inc. and Subsidiary [Member] | ||
Subsequent Event [Line Items] | ||
Subsequent Events | 1 1. Subsequent Events IDX has evaluated subsequent events through the date these financial statements were available to be issued and concluded that there are no material subsequent events which would require adjustment to or disclosure in the accompanying financial statements. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 7 Months Ended | 12 Months Ended |
Aug. 03, 2022 | Jan. 31, 2024 | |
Accounting Policies [Line Items] | ||
Basis of Presentation | Basis of Presentation As result of the Business Combination, the Company evaluated if L&F, ZeroFox, or IDX is the predecessor for accounting purposes. The Company considered the application of Rule 405 of Regulation C, the interpretative guidance of the staff of the United States Securities and Exchange Commission ("SEC"), including factors for the Registrant to consider in determining the predecessor, and analyzed the following: (1) the order in which the entities were acquired, (2) the size of the entities, (3) the fair value of the entities, (4) the historical and ongoing management structure, and (5) how management discusses the Company's business in our Form 10-Q and Form 10-K filings. In considering the foregoing principles of predecessor determination in light of the Company's specific facts and circumstances, management determined that ZeroFox, Inc. is the predecessor for accounting purposes. The financial statement presentation includes the financial statements of ZeroFox, Inc. as “Predecessor” for periods prior to the Closing Date and the financial statements of the Company as “Successor” for the period after the Closing Date, including the consolidation of ZeroFox, Inc. and IDX. The predecessor financial statements for IDX are included separately within this report. Refer to Note 5 for further discussion on the Business Combination. The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("US GAAP") as set forth by the Financial Accounting Standards Board ("FASB"). References to US GAAP issued by the FASB in these notes to the consolidated financial statements are to the FASB Accounting Standards Codifications ("ASC"). | |
Emerging Growth Company Status | Emerging Growth Company Status The Company is an “emerging growth company,” (EGC) as defined in the Jumpstart Our Business Startups Act, (the JOBS Act), and may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not EGCs. The Company may take advantage of these exemptions until it is no longer an EGC under the JOBS Act and has elected to use the extended transition period for complying with new or revised accounting standards. As a result of this election, the Company’s financial statements may not be comparable to companies that comply with public company FASB standards’ effective dates. The JOBS Act exempts EGCs from being required to comply with new or revised financial accounting standards until private companies are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period, which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an EGC, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company's financial statements with certain other public companies difficult or impossible because of the potential differences in accounting standards used. | |
Principles of Consolidation | Principles of Consolidation The accompanying consolidated financial statements include all the accounts of the Company. All intercompany balances and transactions have been eliminated in consolidation. | |
Use of Estimates | Use of Estimates The preparation of the accompanying consolidated financial statements in conformity with US GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities within these consolidated financial statements. Significant estimates and judgments include but are not limited to: (1) revenue recognition, (2) capitalization of internally developed software costs, (3) fair value of stock-based compensation, (4) valuation of assets acquired and liabilities assumed in business combinations, (5) useful lives of contract acquisition costs and intangible assets, (6) evaluation of goodwill and long lived assets for impairment, (7) valuation of warrants and the Sponsor Earnout Shares (see Note 11), (8) fair value of the purchase consideration liability (see Note 11), and (9) valuation allowances associated with deferred tax assets. The Company bases its estimates and assumptions on historical experience, expectations, forecasts, and on various other factors that are believed to be reasonable under the circumstances. Due to the inherent uncertainty involved in making estimates, actual results reported in future periods may differ from results of prior periods. | |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents consist of business checking accounts and money market funds. The Company considers all highly liquid investments with original maturities of three months or less at the time of purchase to be cash equivalents. Cash and cash equivalents are carried at cost, which, due to their short-term nature, approximates fair value. | |
Restricted Cash | Restricted Cash Cash that is unavailable for general operating purposes is classified as restricted cash and is included with other assets on the Consolidated Balance Sheets. Restricted cash represents amounts pledged as collateral for credit card accounts as contractually required by the Company’s lenders. | |
Revenue Recognition | Revenue Recognition The Company derives its revenue from providing its customers with subscription access to the Company’s External Cybersecurity Platform (subscription revenue) and services (services revenue). In accordance with ASC 606, Revenue from Contracts with Customers , revenue is recognized when a customer obtains control of promised services. The amount of revenue recognized reflects the consideration that the Company expects to be entitled to receive in exchange for those services. To achieve the core principle of this standard, the Company applies the following five steps: a) Identify Contracts with Customers. The Company considers the terms and conditions of contracts and its customary business practices in identifying contracts with customers in accordance with ASC 606. The Company determines it has a contract with a customer when the contract is approved, the Company can identify each party’s rights regarding the services to be transferred, the Company can identify the payment terms for the services, and the Company has determined that the customer has the ability and intent to pay and the contract has commercial substance. The Company applies 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. b) 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 the Company, and that are distinct in the context of the contract, whereby the transfer of the services is separately identifiable from other promises in the contract. c) Determine the Transaction Price. The transaction price is determined based on the consideration to which the Company expects to be entitled in exchange for transferring services to the customer. The Company’s typical pricing for its subscriptions and professional services does not result in contracts with significant variable consideration. The Company’s arrangements do not contain significant financing components. d) 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 the stand-alone selling price (SSP) of each performance obligation, using the relative selling price method of allocation. e) Recognize Revenue When or As Performance Obligations are Satisfied. Revenue is recognized at the time the related performance obligation is satisfied by transferring the promised service to a customer. For our performance obligations, the Company transfers control over time, as the customer simultaneously receives and consumes the benefits provided by the Company’s service. Subscription Revenue The Company generates subscription revenue from its External Cybersecurity Platform. Subscription revenue from the External Cybersecurity Platform includes the sale of subscriptions to access the platform and related support and intelligence services. Subscription revenue is driven by the number of assets protected and the desired level of service. These arrangements do not provide the customer with the right to take possession of the Company’s software operating on its cloud platform at any time. These arrangements represent a combined, stand-ready performance obligation to provide access to the software together with related support and intelligence services. Customers are granted continuous access to the External Cybersecurity Platform over the contractual period. Revenue is recognized on a ratable basis over the contract term beginning on the date that the Company’s service is made available to the customer. The Company’s subscription contracts generally have terms of one to three years , which are primarily billed in advance and are non-cancelable. Services Revenue The Company generates services revenue by executing engagements for data breach response and intelligence services. The Company generates breach response revenue primarily from various combinations of notification, project management, communication services, and ongoing identity protection services. Performance periods generally range from one to three years . The Company’s breach response contracts are structured as either fixed price or variable price. In fixed price contracts, the Company charges a fixed total price or fixed individual price for the total combination of services. For variable price breach services contracts, the Company charges the breach communications component, which includes notifications and call center, at a fixed total fee, and the Company charges the ongoing identity protection services as incurred using a fixed price per enrollment. The Company generally bills for fixed fees at the time the contract is executed. For larger contracts, the Company bills 50% at the time the contract is executed and the remaining 50% within 30 days of contract execution. For variable price breach contracts, the Company invoices for identity protection services monthly based on actual enrollments. The Company offers several types of cybersecurity services, including investigative, security advisory and training services. The Company often sells a suite of cybersecurity services along with subscriptions to its External Cybersecurity Platform. All of the Company’s advisory and training services are considered distinct performance obligations from the External Cybersecurity Platform subscriptions services within the context of the Company’s contracts. Revenue is recognized over time as the customers benefit from these services as they are performed or as control of the promised services is transferred to the customer. These contracts are most often fixed fee arrangements and less frequently arrangements that are billed at hourly rates. These contracts normally have terms of one year or less. Contracts with Multiple Performance Obligations The majority of the Company’s contracts with customers contain multiple performance obligations. For these contracts, the Company accounts for individual performance obligations separately . The transaction price is allocated to the separate performance obligations based on the SSP of each performance obligation using the relative selling price method of allocation. Revenue from Reseller Arrangements The Company enters into arrangements with third parties that allow those parties to resell the Company’s services to end users. The partners negotiate pricing with the end customer and the Company does not have visibility into the price paid by the end customer. For these arrangements, the Company recognizes revenue at the amount charged to the reseller and does not reflect any mark-up to the end user. Government Contracts The Company evaluates arrangements with governmental entities containing fiscal funding or termination for convenience provisions, when such provisions are required by law, to determine the probability of possible cancellation. The Company considers multiple factors, including the history with the customer in similar transactions and budgeting and approval processes undertaken by the governmental entity. If the Company determines upon execution of these arrangements that the likelihood of cancellation is remote, it then recognizes revenue for such arrangements once all relevant criteria have been met. If such a determination cannot be made, revenue is recognized upon the earlier of cash receipt or approval of the applicable funding provision by the governmental entity for such arrangements. Timing of Revenue Recognition The table below provides revenue earned by timing of revenue for the year ended January 31, 2024, the Successor Period, and the Predecessor Period (in thousands). Successor Predecessor Revenue Recognition Timing Year ended January 31, 2024 August 4, 2022 to February 1, 2022 to Over time $ 185,345 $ 79,025 $ 27,946 Point in time 47,955 9,361 1,291 Total $ 233,300 $ 88,386 $ 29,237 | |
Cost of Revenue | Cost of Revenue Cost of revenue consists primarily of wages and benefits for software operations, service delivery, and customer support personnel. Cost of revenue also includes all direct costs of maintenance and hosting, as well as the amortization of costs capitalized for the development of the Company’s enterprise cloud platform and acquired technology, and allocated overhead, primarily shared IT expenses. | |
Research and Development | Research and Development Research and development costs are expensed in the period incurred and consist primarily of payroll and personnel costs, consulting costs, software and web services, and allocated overhead, primarily shared IT expenses. | |
General and Administrative | General and Administrative General and administrative costs are expensed in the period incurred and consist primarily of salaries and other related costs, including stock-based compensation, for personnel in the Company’s executive and finance functions. General and administrative costs also include professional fees for legal, accounting, auditing, tax and consulting services; travel expenses; and facility-related expenses, which include costs for rent and maintenance of facilities and other operating costs. | |
Sales and Marketing | Sales and Marketing Selling and marketing expenses consist primarily of salaries, commissions, stock-based compensation, benefits and bonuses for personnel associated with sales and marketing activities, as well as costs related to advertising, product management, promotional materials, public relations, amortization of acquired customer relationships, other sales and marketing programs, and allocated overhead, primarily shared IT expenses. | |
Advertising | Advertising Advertising costs, which are expensed and included in sales and marketing expense in the period incurred were $ 1.3 million, $ 0.4 million, and $ 0.5 million during the year ended January 31, 2024, the Successor Period, and the Predecessor Period , respectively. | |
Income Taxes | Income Taxes In accordance with ASC 740, Income Taxes, income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the consolidated financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those assets and liabilities are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. The measurement of a deferred tax asset is reduced, if necessary, by a valuation allowance if it is more likely than not that some portion or all of the deferred tax asset will not be realized. ASC 740 prescribes a recognition threshold and a measurement attribute for the consolidated financial statement recognition and measurement of tax positions taken, or expected to be taken, in a tax return, as well as guidance on derecognition, classification, interest, penalties, and consolidated financial statement reporting disclosures. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The amount recognized is measured as the largest amount of benefit that is greater than 50 % likely of being realized upon ultimate settlement. The Company recognizes interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense. The Company remains subject to examination by U.S. federal and various state tax authorities for the fisca l years 2020 thr ough 2023, and may be further extended upon the utilization of NOL carryforwards. | |
Stock-Based Compensation | Stock-Based Compensation The Company accounts for stock-based compensation in accordance with ASC 718 , Compensation — Stock Compensation . ASC 718 requires that the cost of awards of equity instruments offered in exchange for employee services, including employee stock options and restricted stock awards, be measured based on the grant-date fair value of the award. The Company adopted FASB ASU No. 2016-09, Compensation — Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting , on February 1, 2019. This ASU involves several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification in the consolidated statements of cash flows. The adoption did not have a material impact on the consolidated financial statements of the Company. The Company determines the fair value of options granted using the Black-Scholes-Merton option-pricing model (“Black-Scholes model”) and recognizes the cost over the period during which an employee is required to provide service in exchange for the award, generally the vesting period, net of estimated forfeitures. The fair value of restricted stock awards is based on the estimated price of the Company’s common stock on the date of grant and is recognized as expense over the requisite service period of the awards, net of estimated forfeitures. Prior to the Company's stock being publicly traded, the Company was required to estimate the fair value of common stock. The Board of Directors considered numerous objective and subjective factors to determine the fair value of the Company’s common stock at each meeting in which awards are approved. The factors considered include, but are not limited to: (i) the results of contemporaneous independent third-party valuations of the Company’s common stock; (ii) the prices, rights, preferences, and privileges of the Company’s Convertible Redeemable Preferred Stock relative to those of its common stock; (iii) the lack of marketability of the Company’s common stock; (iv) actual operating and financial results; (v) current business conditions and projections; (vi) the likelihood of achieving a liquidity event, such as an initial public offering or sale of the Company, given prevailing market conditions; and (vii) precedent transactions involving the Company’s shares. | |
Leases | Leases The Company adopted ASC Topic 842, Leases for the fiscal year 2023. Refer to "Standards Issued and Adopted " in this footnote for more information. The Company determines if an arrangement contains a lease and the classification of that lease, if applicable, at inception. For contracts with lease and non-lease components, we have elected to not allocate the contract consideration, and account for the lease and non-lease components as a single lease component. Operating leases are included in operating lease right-of-use (ROU) assets, operating lease liabilities and operating lease liabilities (net of current portion) in our Consolidated Balance Sheets. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments under the lease. Operating lease ROU assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. The implicit rate within our operating leases is generally not determinable and we use our incremental borrowing rate at the lease commencement date to determine the present value of lease payments. The determination of our incremental borrowing rate requires judgment. The Company determines our incremental borrowing rate for each lease using our current borrowing rate, adjusted for various factors including level of collateralization and term to align with the terms of the lease. The operating lease ROU asset also includes any lease prepayments, offset by lease incentives. Certain of our leases include options to extend or terminate the lease. An option to extend the lease is considered in connection with determining the ROU asset and lease liability when it is reasonably certain we will exercise that option. An option to terminate is considered in the determination of the lease term unless it is reasonably certain we will not exercise the option. Lease expense for lease payments is recognized on a straight-line basis over the term of the lease. | |
Business Combinations | Business Combinations The Company accounted for the Business Combination using the acquisition method pursuant to ASC 805, Business Combinations . The Company determined that ZeroFox, Inc. is a Variable Interest Entity (VIE) as its equity at risk is not sufficient to fund its expected future cash flow needs including funding future projected losses and servicing existing debt obligations. The Company holds a variable interest in ZeroFox, Inc. as it owns 100 % of the equity of ZeroFox, Inc. following completion of the Business Combination. The Company is considered the primary beneficiary of ZeroFox, Inc. as its ownership provides power to direct the activities that most significantly impact ZeroFox, Inc.'s performance and the Company has the obligation to absorb the losses and/or receive the benefits of ZeroFox, Inc., which potentially could be significant. Accordingly, the Company is both the legal and accounting acquirer of ZeroFox, Inc. The Company identified itself as both the legal and accounting acquirer of IDX. As the Company is identified as the accounting acquirer for both ZeroFox, Inc. and IDX, both mergers are considered "forward mergers". Under the "forward merger" approach of the acquisition method of accounting, the Company allocated the consideration transferred to effect the mergers to the assets acquired and liabilities assumed based on their estimated acquisition-date fair values. The Company recognized the excess of consideration transferred over the fair values of assets acquired and liabilities assumed as goodwill. The Company expensed all transaction related costs of the Business Combination. Significant estimates in valuing certain identifiable assets include, but are not limited to, the selection of valuation methodologies, future expected cash flows, discount rates, and useful lives. Management’s 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. Acquisition costs, such as legal and consulting fees, are expensed as incurred and are included in general and administrative expenses in the consolidated statements of comprehensive loss. During the measurement period, which is up to one year from the acquisition date, the Company may record adjustments to the assets acquired and liabilities assumed, with the corresponding offset to goodwill. Upon the conclusion of the measurement period, any subsequent adjustments are recorded in the consolidated statements of comprehensive loss. See Note 5 for additional information regarding the Business Combination. | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill represents the excess of the purchase price over the fair value of identifiable assets acquired and liabilities assumed when a business is acquired. The valuation of intangible assets and goodwill involves the use of the Company's estimates and assumptions and can have a significant impact on future operating results. The Company initially records its intangible assets at fair value. Intangible assets with finite lives are amortized over their estimated useful lives while goodwill is not amortized but is evaluated for impairment at least annually. Goodwill is evaluated for impairment beginning on November 1 of each year or when an assessment of qualitative factors indicates an impairment may have occurred. The quantitative assessment includes an analysis that compares the fair value of a reporting unit to its carrying value including goodwill recorded by the reporting unit. The Company has a single reporting unit. Accordingly, the impairment assessment for goodwill is performed at the enterprise level. Goodwill is reviewed for possible impairment between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of the reporting unit below its carrying value. The Company initially assesses qualitative factors to determine if it is necessary to perform the goodwill impairment review. Goodwill is reviewed for impairment if, based on an assessment of the qualitative factors, it is determined that it is more likely than not that the fair value of the reporting unit is less than its carrying value, or the Company decides to bypass the qualitative assessment. The Company uses a combination of methods to estimate the fair value of its reporting unit including the discounted cash flow, guideline public company, and merger and acquisitions methods. These valuation approaches consider a number of factors that include, but are not limited to, prospective financial information, growth rates, terminal value, discount rates, and comparable multiples from publicly traded companies and merger transactions in the Company's industry. Use of these factors requires the Company to make certain assumptions and estimates regarding industry economic factors and future profitability of its business. Additionally, the Company considers income tax effects from any tax-deductible goodwill (if applicable) on the carrying amount of the reporting unit when measuring the goodwill impairment loss. It is possible that future changes in such circumstances, or in the variables associated with the judgments, assumptions, and estimates used in assessing the fair value of the reporting unit would require the Company to record a non-cash impairment charge. The Company considered qualitative factors that would indicate if the fair value of the Company's single reporting unit had declined below its carrying value, including the decline in the price of the Company's Common Stock, market conditions, and macroeconomic factors. Based on this qualitative analysis, the Company concluded that interim tests of goodwill impairment were required. The Company recorded impairment cha rges totaling $ 284.2 million during the year ended January 31, 2024, and $ 698.7 million during the Successor Period. The Company performed an annual quantitative assessment of the fair value of the Company's single reporting unit and determined its fair value to be $ 572.7 million as of October 31, 2023. As the carrying value of the reporting unit was $ 644.8 million prior to the recognition of the impairment charge, which was above the estimated fair value of the reporting unit, the Company recorded a goodwill impairment charge $ 72.1 million. The remaining $ 212.1 million was recorded as part of the interim test of goodwill as of January 31, 2024 based on the fair value implied by the Haveli Merger Agreement. The Company's estimate of the fair value of its single reporting unit of $ 348.1 million as of January 31, 2024, was below the carrying value of the reporting unit of $ 560.2 million. | |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets Long-lived assets, including intangible assets with finite lives, are reviewed for impairment when events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. Recoverability of the assets is measured by a comparison of the carrying amount of an asset or asset group to the future undiscounted cash flows expected to be generated by the asset or asset group. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the asset or asset group. As of January 31, 2024, management does not believe any long-lived assets are impaired and has not identified any assets as being held for disposal. | |
Warrant Liabilities | Warrant Liabilities The Company evaluates all of its financial instruments, including issued stock purchase warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives, pursuant to ASC 480, Distinguishing Liabilities from Equity and FASB ASC 815, Derivatives and Hedging . The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in the ASC 480 and ASC 815. The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, whether the warrants meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s own Common Stock. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding. For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded at their initial fair value on the date of issuance, and each balance sheet date thereafter. The Company recognizes changes in the estimated fair value of the warrants as a non-cash gain or loss on the Consolidated Statement of Comprehensive Loss. The Company assessed both Public and Private Warrants and determined both met the criteria for liability treatment. | |
Sponsor Earnout Shares | Sponsor Earnout Shares The Company analyzed the terms of the Sponsor Earnout Shares (see Note 11) and determined they are within the scope of ASC 815. The Company determined that the Sponsor Earnout Shares do not meet the requirements to be recognized as an equity instrument as the Company could not conclude the Sponsor Earnout Shares are indexed to the Company's own equity. Therefore, the Company recognizes the Sponsor Earnout Shares as a liability recorded at fair value. The Sponsor Earnout Shares are not considered outstanding for accounting purposes since they are considered contingently issuable and are therefore, excluded from the calculation of basic earnings per share. The Company analyzed the terms of the Sponsor Earnout Shares to determine if they meet the definition of "participating securities", which would require the two-class method of EPS. The holders of the Sponsor Earnout Shares are not entitled to nonforfeitable rights to dividends and as such, the Sponsor Earnout Shares do not meet the definition of "participating securities". | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments ASC 820-10, Fair Value Measurements and Disclosures: Overall , defines fair value, establishes a fair value hierarchy for assets and liabilities measured at fair value, and expands required disclosures about fair value measurements. The fair value of an asset and liability is defined as an exit price and represents the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. The three-tier fair value hierarchy, which prioritizes the inputs used to measure fair value, is as follows: Level 1 —Inputs are quoted prices in active markets for identical assets or liabilities that the Company can access at the measurement date. Level 2 —Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities or quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 —Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets and liabilities. Assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurements. The Company’s assessment of the significance of an input to the fair value measurement requires judgment and may affect the valuation of the asset or liability being measured and its placement within the fair value hierarchy. The Company effectuates transfers between levels of the fair value hierarchy, if any, as of the date of the actual circumstance that caused the transfer. Certain assets and liabilities, including goodwill and intangible assets, are subject to measurement at fair value on a non-recurring basis if there are indicators of impairment or if they are deemed to be impaired as a result of an impairment review. As of January 31, 2024 and 2023, the Company had outstanding Public Warrants and Private Warrants. The Company measured its Public Warrants based on a Level 1 input, the public price for the Company's warrants traded on Nasdaq(ticker ZFOXW). The Company measured a portion of its Private Warrants based on a Level 2 input, the same price for the Company's Public Warrants traded on Nasdaq. The Company analyzed the terms and features of the Private Warrants and determined that they were economically similar to the Public Warrants. As of January 31, 2024, the Company measured the Stifel Warrant issued in connection with the LookingGlass Acquisition (see Note 5) based on Level 3 inputs. The assumptions used to value all warrants are described in Note 11. The Company measured the liability for Sponsor Earnout Shares using Level 3 inputs. The methodology and assumptions used to measure the Sponsor Earnout Shares are described in Note 11. A summary of the changes in the fair value of warrants for the year ended January 31, 2024, the Successor Period, the Predecessor Period, respectively, is as follows (in thousands): Successor Public Private Warrant liability - February 1, 2023 $ 1,373 $ 1,208 Issuance of warrants — 126 Gain due to change in fair value of warrants ( 1,297 ) ( 1,190 ) Warrant liability - January 31, 2024 $ 76 $ 144 Warrant liability - August 4, 2022 $ 4,226 $ 11,351 Exercise of warrants — ( 7,632 ) Gain due to change in fair value of warrants ( 2,853 ) ( 2,511 ) Warrant liability - January 31, 2023 $ 1,373 $ 1,208 Predecessor Warrant liability - January 31, 2022 $ 10,709 Issuance of warrants 519 Exercise of warrants ( 5,900 ) Loss due to change in fair value of warrants 2,059 Warrant liability - August 3, 2022 $ 7,387 The Stifel Warrant is included in the Private Warrants column in the table above as of January 31, 2024. The carrying amounts of accounts receivable, accounts payable, and accrued expenses approximate fair value because of the short maturity terms of these instruments. The carrying amount of the Stifel Note (see Note 10) approximates fair value due to the short duration of time that has elapsed since the amendment to the loan and security agreement. The carrying amount of the Alsop Louie Convertible Note (see Note 10) approximates fair value due to the short duration of time that has elapsed since the note has been issued. | |
Concentration of Credit Risk | Concentration of Credit Risk The Company maintains cash balances in bank deposit accounts, which, at times, may exceed federally insured limits. Deposits held in interest-bearing checking accounts are insured up to $250,000. Deposits held in insured cash sweep accounts are insured up to $150.0 million. The Company has not experienced any losses in such accounts, and believes it is not exposed to any significant credit risk from cash. The Company does not perform ongoing credit evaluations; generally does not require collateral; and establishes an allowance for doubtful accounts based upon factors surrounding the credit risk of customers, historical trends, and other information. | |
Concentration of Revenue and Accounts Receivable | Concentration of Revenue and Accounts Receivable For the year ended January 31, 2024, one individual customer accounted for 35 % of total consolidated revenue. F or the period August 4, 2022, to January 31, 2023, one individual customer accounted for 47 % of total consolidated revenue . For the period February 1, 2022, to August 3, 2022, there was no individual customer that accounted for 10 % or more of total consolidated revenue. As of January 31, 2024 and 2023, one customer represented 18 % and 23 % of total accounts receivable, respectively. | |
Accounts Receivable | Accounts Receivable Accounts receivable represent net realizable amounts due from customers for subscription to the Company’s cloud-based software platform and for professional services provided by the Company. Such amounts are recorded net of allowances for bad debts. The Company’s estimates of allowances for bad debts are based on contractual terms and historical collection experience. As of January 31, 2023 and 2022, the Company’s accounts receivable consisted of the following (in thousands): January 31, 2024 January 31, 2023 Accounts receivable, billed $ 30,912 $ 22,296 Accounts receivable, unbilled 8,212 7,458 Less: Allowance for doubtful accounts ( 201 ) ( 145 ) Accounts receivable, net $ 38,923 $ 29,609 The allowance for doubtful accounts reflects the Company’s estimate of probable losses inherent in the accounts receivable balance. The Company determines the allowance based on known troubled accounts, historical experience, and other currently available evidence. Activity in the allowance for doubtful accounts for the year ended January 31, 2024, and the Successor Period, was as follows (in thousands): January 31, 2024 January 31, 2023 Balance at beginning of period $ 145 $ 133 Charged to cost and expenses 118 32 Write-offs and recoveries ( 62 ) ( 20 ) Balance at end of period $ 201 $ 145 | |
Deferred Contract Acquisition Costs | Deferred Contract Acquisition Costs Contract acquisition costs are primarily related to sales commissions earned by our sales force and such costs are considered incremental costs to obtain a contract. Sales commissions for initial contracts are deferred and then amortized taking into consideration the pattern of transfer to which the asset relates and may include expected renewal periods where renewal commissions are not commensurate with the initial commissions period. The Company typically recognizes the initial commissions over the longer of the customer relationship (generally estimated to be four to six years) or over the same period as the initial revenue arrangement to which these costs relate. Renewal commissions not commensurate with the initial commissions paid are generally amortized over the renewal period. Commissions earned for professional services related to breach arrangements are amortized on a straight-line basis over the estimated period of benefit of 15 months. Commissions earned for professional services related to subscription arrangements for new customers are amortized over the customer relationship (generally estimated to be four to six years). Commissions earned for professional services related to renewed subscription arrangements are amortized over the term of the arrangement. A summary of deferred contract acquisition costs activity for the year ended January 31, 2024, and the Successor Period, is as follows (in thousands): Deferred contract acquisition costs - February 1, 2023 $ 13,207 Purchase accounting adjustment ( 8,834 ) Capitalization of contract acquisition costs 12,334 Amortization of deferred contract acquisition costs ( 6,601 ) Deferred contract acquisition costs - January 31, 2024 $ 10,106 Deferred contract acquisition costs, current $ 5,351 Deferred contract acquisition costs, net of current portion 4,755 Deferred contract acquisition costs - January 31, 2024 $ 10,106 Deferred contract acquisition costs - August 4, 2022 $ 12,091 Capitalization of contract acquisition costs 4,915 Amortization of deferred contract acquisition costs ( 3,799 ) Deferred contract acquisition costs - January 31, 2023 $ 13,207 Deferred contract acquisition costs, current $ 5,456 Deferred contract acquisition costs, net of current portion 7,751 Deferred contract acquisition costs - January 31, 2023 $ 13,207 Deferred Contract Fulfilment Costs Contract fulfilment costs relate to costs to operate the call center for our breach customer contracts and such costs are considered incremental costs to fulfil a contract. These costs are deferred and then amortized taking into consideration the pattern of transfer to which the asset relates. As the contract fulfilment costs relate to the combined call center and monitoring service performance obligation, they are amortized over a period of 15 months. Deferred contract fulfilment costs that will be amortized during the next twelve months is included in prepaid expenses and other assets, and the remaining portion is included in other assets on the Consolidated Balance Sheet. As of January 31, 2024, deferred contract fulfilment costs were $ 1.9 million and are included in prepaid expenses and other assets. As of January 31, 2023, deferred contract fulfilment costs were $ 0.9 million, of which $ 0.8 million is included in prepaid expenses and other assets and $ 0.1 million is included in other assets. Amortization expense, which is included in cost of revenue, was $ 3.9 million and $ 0.3 million for the year ended January 31, 2024, and the Successor Period, respectively. | |
Deferred contract fulfillment costs | Deferred Contract Fulfilment Costs | |
Property and Equipment | Property and Equipment Property and equipment are recorded at cost. Expenditures for major additions and improvements are capitalized. Repairs and maintenance costs are charged to expense as incurred. When property and equipment are retired, or otherwise disposed of, the cost and accumulated depreciation and amortization are removed from the accounts, and any resulting gain or loss is included in the results of operations for the respective period. Depreciation and amortization are computed using the straight-line method. The estimated useful lives for significant property and equipment categories are as follows: Asset Classification Estimated Useful Life Computer hardware and purchased software 2 - 3 years Furniture and fixtures 3 - 7 years Leasehold improvements Lesser of lease term or useful life | |
Capitalized Software Costs | Capitalized Software Costs The Company capitalizes internally developed software costs incurred in accordance with ASC 350-40, Intangibles — Goodwill and Other: Internal-Use Software . The Company capitalizes payroll, payroll-related costs, and any external direct costs incurred during the application development stage. Costs related to preliminary project activities and post-implementation activities are expensed as incurred. Internal-use software is amortized on a straight-line basis over its estimated useful life, which is generally three years. The Company’s capitalized software development costs were $ 0.2 million, $ 0.3 million, and $ 0.5 million for the year ended January 31, 2024, the Successor Period, and the Predecessor Period , respectively. Amortization expense, which is included in cost of revenue, was $ 0.1 million, $ 0.02 million, and $ 0.3 million, for the year ended January 31, 2024, the Successor Period, and the Predecessor Period, respectively. Future amortization expense for software development costs capitalized as of January 31, 2024, is as follows (in thousands): 2025 $ 165 2026 138 2027 39 Total $ 342 | |
Transaction Fees | Transaction Fees All transaction fees and expenses associated with the Business Combination were expensed as incurred. Accordingly, the Company recorded approximately $ 1.2 million of professional and other transaction fees related to the Business Combination in general and administrative expenses in the Consolidated Statement of Comprehensive Loss for the Successor Period. The Predecessor recorded approximately $ 3.2 million of professional and other transaction fees related to the Business Combination in general and administrative expenses in the Consolidated Statement of Comprehensive Loss for the Predecessor Period. The Company paid a total of $ 8.5 million of banking and advisory fees on behalf of the Predecessor at the closing of the Business Combination. The expense related to these banking and advisor fees was not recognized in the Predecessor's financial results as the payment of the banking and advisory fees was contingent on the successful closing of the Business Combination. The Company included the banking and advisory fees as part of the consideration transferred to acquire the Predecessor (see Note 5). All transaction fees and expenses associated with the LookingGlass Acquisition (see Note 5) were expensed as incurred. Accordingly, the Company recorded approximately $ 1.6 million of professional and other transaction fees related to the business acquisition of LookingGlass in general and administrative expenses in the Consolidated Statement of Comprehensive Loss for the year ended January 31, 2024. All transaction fees and expenses associated with the Haveli Merger Agreement (see Note 18) were expensed as incurred. Accordingly, the Company recorded approximately $ 0.9 million of professional and other transaction fees related to the Merger Agreement in general and administrative expenses in the Consolidated Statement of Comprehensive Loss for the year ended January 31, 2024. | |
Deferred Revenue | Deferred Revenue Deferred revenue represents amounts billed for which revenue has not yet been recognized. Deferred revenue that will be recognized during the next twelve months is recorded as current deferred revenue, and the remaining portion is recorded as deferred revenue, net of current portion. | |
Debt Issuance Costs | Debt Issuance Costs Debt issuance costs consist of fees paid in cash to lenders and service providers in connection with the origination of debt, as well as the grant-date fair value of warrants issued to lenders in connection with the origination of debt. These costs are capitalized as debt issuance costs and presented as a direct deduction from the carrying value of the associated debt liability. Debt issuance costs are amortized using the effective interest method and are reflected in interest expense, net, on the Consolidated Statements of Comprehensive Loss. For the year ended January 31, 2024, the Successor Period, and the Predecessor Period, deferred debt issuance costs consisted of the following (in thousands): Successor Deferred debt issuance costs - February 1, 2023 $ 127 Direct costs paid 201 Amortization of debt issuance costs ( 117 ) Deferred debt issuance costs - January 31, 2024 $ 211 Deferred debt issuance costs - August 4, 2022 $ 120 Direct costs paid 31 Amortization of debt issuance costs ( 24 ) Deferred debt issuance costs - January 31, 2023 $ 127 Predecessor Deferred debt issuance costs - January 31, 2022 $ 1,627 Direct costs paid 118 Grant-date fair value of warrants issued 518 Amortization of debt issuance costs ( 378 ) Deferred debt issuance costs - August 3, 2022 $ 1,885 | |
Net Loss Per Share Attributable to Common Stockholders | Net Loss Per Share Attributable to Common Stockholders Basic net loss per share attributable to common stockholders is computed by dividing the net loss attributable to common stockholders by the weighted average number of common shares outstanding for the period. Diluted net loss attributable to common stockholders is computed by adjusting net loss attributable to common stockholders to reallocate undistributed earnings based on the potential impact of dilutive securities. Diluted net loss per share attributable to common stockholders is computed by dividing the diluted net loss attributable to common stockholders by the weighted average number of common shares outstanding for the period, including potential dilutive common stock. For the purposes of this calculation, outstanding stock options, unvested restricted stock, stock warrants, Sponsor Earnout Shares, and redeemable convertible preferred stock are considered potential dilutive common stock and are excluded from the computation of net loss per share as their effect is anti-dilutive. The Predecessor’s redeemable convertible preferred stock and restricted common stock contractually entitled the holders of such shares to participate in dividends but do not contractually require the holders of such shares to participate in losses of the Predecessor. Accordingly, in periods in which the Predecessor reported a net loss, such losses were not allocated to such participating securities. In periods in which the Predecessor reported a net loss attributable to common stockholders, diluted net loss per share attributable to common stockholders was the same as basic net loss per share attributable to common stockholders, since dilutive common shares are not assumed to be outstanding if their effect is anti-dilutive. | |
Comprehensive Loss | Comprehensive Loss Comprehensive loss includes net loss as well as other changes in stockholders’ deficit that result from transactions and economic events other than those with stockholders. For the year ended January 31, 2024, the Successor Period, and the Predecessor Period, there was a difference between net loss and comprehensive loss in the accompanying Consolidated Financial Statements pertaining to foreign currency translation adjustments . | |
Predecessor Redeemable Convertible Preferred Stock | Foreign Currency Translation The functional currency of the Company’s subsidiaries is the local currency. For each subsidiary, assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rates in effect at the Consolidated Balance Sheet date, and revenue and expenses are translated at the average exchange rates prevailing during the month of the transaction. The effects of foreign currency translation adjustments not affecting net income are included in the Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders’ Equity (Deficit) under the cumulative translation adjustment account as a component of accumulated other comprehensive loss. | |
Reclassifications | Reclassifications Liabilities arising from warrants, the Sponsor Earnout Shares, and deferred taxes totaling $ 27.6 million were reclassified from Warrants, Sponsor earnout shares and Deferred tax liability to Other liabilities in our balance sheet as of January 31, 2023, which is consistent with our current year presentation. | |
Standards Issued and Adopted | Standards Issued and Adopted In June 2016, the FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Instruments , which amends the accounting for credit losses for most financial assets and certain other instruments. The standard requires that entities holding financial assets that are not accounted for at fair value through net income be presented at the net amount expected to be collected. An allowance for credit losses will be a valuation account that will be deducted from the amortized cost basis of the financial asset to present the net carrying value at the amount expected to be collected on the financial asset. The Company adopted ASU 2016-13 on February 1, 2023, using the modified transition approach. The adoption of the standard did not have a material impact on the consolidated financial statements. In June 2022, the FASB issued ASU 2022-03, Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions , which clarifies the guidance in ASC 820 on the fair value measurement of an equity security that is subject to a contractual sale restriction. The standard clarifies that entities should not apply a discount related to a contractual sale restriction of an equity security when measuring the fair value of the equity security. The standard provides that entities should instead consider sale restrictions that are characteristics of the equity security. The standard is effective for public business entities' fiscal years beginning after December 15, 2023, and interim periods within those fiscal years, with early adoption permitted. The Company elected to early adopt ASU 2022-03 effective February 1, 2023. The adoption of the standard did not have a material impact on the consolidated financial statements. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures , which is intended to enhance the transparency, decision usefulness, and effectiveness of income tax disclosures. The standard will be effective for the Company beginning with the fiscal year ending January 31, 2026, with early adoption permitted. The Company is currently evaluating the impact of this standard on our income tax disclosures. | |
ID Experts Holdings, Inc. and Subsidiary [Member] | ||
Accounting Policies [Line Items] | ||
Basis of Presentation | Basis of Presentation The consolidated financial statements have been prepared in conformity with generally accepted accounting principles in the United States of America (US GAAP) set forth by the Financial Accounting Standards Board (FASB). References to U.S. GAAP issued by the FASB in these notes to the consolidated financial statements are to the FASB Accounting Standards Codification (ASC). IDX presented financial statements from the beginning of the year to the acquisition date of August 3, 2022. | |
Emerging Growth Company Status | Emerging Growth Company Status The Company is an “emerging growth company” (EGC), as defined in the Jumpstart Our Business Startups Act (the JOBS Act), and may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not EGCs. The Company may take advantage of these exemptions until it is no longer an EGC under Section 107 of the JOBS Act and has elected to use the extended transition period for complying with new or revised accounting standards. As a result of this election, the Company’s financial statements may not be comparable to companies that comply with public company FASB standards’ effective dates. IDX merged with L&F on August 3, 2022. Refer to Note 1 for more information regarding the Business Combination. The surviving company, ZeroFox Holdings, will remain an emerging growth company until the earliest of (i) the last day of the surviving company’s first fiscal year following the fifth anniversary of the completion of the L&F’s initial public offering, (ii) the last day of the fiscal year in which ZeroFox Holdings has total annual gross revenue of at least $ 1.235 billion, (iii) the last day of the fiscal year in which ZeroFox Holdings is deemed to be a large accelerated filer, which means the market value of ZeroFox Holding’s common stock that is held by non-affiliates exceeds $ 700.0 million as of the prior July 31 or (iv) the date on which ZeroFox Holdings has issued more than $ 1.0 billion in non-convertible debt securities during the prior three-year period. | |
Principles of Consolidation | Principles of Consolidation The accompanying consolidated financial statements include all the accounts of IDX. All intercompany balances and transactions have been eliminated in consolidation. | |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires that management make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the amounts of revenues and expenses reported during the period. Such estimates include assumptions used in the allocation of revenue, long-lived assets, liabilities, depreciable lives of assets, stock-based compensation, and deferred income taxes. Actual results could differ from those estimates, and such differences may be material to the consolidated financial statements. | |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents consist of business checking accounts. The Company considers all highly liquid investments with an original maturity of three months or less at the time of purchase to be cash equivalents. The Company generally places its cash and cash equivalents with major financial institutions deemed to be of high-credit-quality in order to limit its credit exposure. The Company maintains its cash accounts with financial institutions where, at times, deposits exceed federal insurance limits. Cash and cash equivalents are carried at cost, which due to their short-term nature, approximate fair value. | |
Revenue Recognition | Revenue Recognition In accordance with ASC 606, revenue is recognized when a customer obtains control of promised products or services. The amount of revenue recognized reflects the consideration that the Company expects to be entitled to receive in exchange for those products or services. To achieve the core principle of this standard, the Company applies the following five steps: a) Identify Contracts with Customers, b) Identify the Performance Obligations in the Contract, c) Determine the Transaction Price, d) Allocate the Transaction Price to Performance Obligations in the Contract, and e) Recognize Revenue When or As Performance Obligations are Satisfied. For arrangements with multiple performance obligations, the Company allocates total consideration to each performance obligation on a relative fair value basis based on management’s estimate of stand-alone selling price (SSP). The following table illustrates the timing of the Company’s revenue recognition: January 1, 2022, to August 3, 2022 Breach - point in time 12.6 % Breach - over time 83.4 % Membership services - over time 4.0 % As discussed in Note 3, all revenue was recognized over time prior to the adoption of ASC 606. Breach Services The Company’s breach services revenue consists of contracts with various combinations of notification, project management, communication services, and ongoing identity protection services. Performance periods generally range from one to three years . Payment terms are generally between thirty and sixty days. Contracts generally do not contain significant financing components. The pricing for the Company’s breach services contracts is structured as either fixed price or variable price. In fixed price contracts, a fixed total price or fixed per-impacted-individual price is charged for the total combination of services. For variable price breach services contracts, the breach communications component, which includes notifications and call center, is charged at a fixed total fee and ongoing identity protection services are charged as incurred using a fixed price per enrollment. Fixed fees are generally billed at the time the statement of work is executed and are due upon receipt. Large, fixed-fee contracts are typically billed 50% upfront and due upon receipt with the remaining 50% invoiced 30 days later with net 30 terms. For variable price contracts the charges for identity protection services are billed monthly for the prior month and are due net 30. Membership Services The Company provides membership services through its employer groups and strategic partners as well as directly to end-users through its website. Membership services consist of multiple, bundled identity and privacy product offerings and provide members with ongoing identity protection services. For membership services, revenue is recognized ratably over the service period. Performance periods are generally one year . Payments from employer groups and strategic partners are generally collected monthly. Payments from end-users are collected up front. Provisions for estimated losses on uncompleted contracts are made in the period in which such losses are determined. No losses on uncompleted contracts were recognized for the period July 1, 2022, to August 3, 2022, and the period January 1, 2022, to August 3, 2022. Significant Judgments Significant judgments and estimates are required under ASC 606. Due to the complexity of certain contracts, the actual revenue recognition treatment required under ASC 606 for the Company’s arrangements may be dependent on contract-specific terms and may vary in some instances. The Company’s contracts with customers often include promises to transfer multiple services including project management services, notification services, call center services, and identity protection services. Determining whether services are distinct performance obligations that should be accounted for separately requires significant judgment. The Company is required to estimate the total consideration expected to be received from contracts with customers, including any variable consideration. Once the estimated transaction price is established, amounts are allocated to performance obligations on a relative SSP basis. The Company’s breach business derives revenue from two main performance obligations: (i) notification and (ii) combined call center and monitoring services, described further in Note 3. At contract inception, the Company assesses the products and services promised in the contract to identify each performance obligation and evaluates whether the performance obligations are capable of being distinct and are distinct within the context of the contract. Performance obligations that are not both capable of being distinct and distinct within the context of the contract are combined and treated as a single performance obligation in determining the allocation and recognition of revenue. Determining whether products and services are considered distinct performance obligations requires significant judgment. In determining whether products and services are considered distinct performance obligations, the Company assesses whether the customer can benefit from the products and services on their own or together with other readily available resources and whether our promise to transfer the product or service to the customer is separately identifiable from other promises in the contract. Judgment is required to determine the SSP for each distinct performance obligation. The Company rarely sells its individual breach services on a standalone basis and accordingly, the Company is required to estimate the range of SSPs for each performance obligation. In instances where the SSP is not directly observable because the Company does not sell the service separately, the Company reviews information that includes historical discounting practices, market conditions, cost-plus analyses, and other observable inputs to determine an appropriate SSP. The Company typically has more than one SSP for individual performance obligations due to the stratification of those items by classes of customers, size of breach, and other circumstances. In these instances, the Company may use other available information such as service inclusions or exclusions, customizations to notifications, or varying lengths of call center or identity protection services in determining the SSP. If a group of agreements are so closely related to each other that they are in effect part of a single arrangement, such agreements are deemed to be one arrangement for revenue recognition purposes. The Company exercises judgment to evaluate the relevant facts and circumstances in determining whether the separate agreements should be accounted for separately or as in substance, a single arrangement. The Company’s judgments about whether a group of contracts comprises a single arrangement can affect the allocation of consideration to the distinct performance obligations, which could have an effect on results of the Company’s operations. The Company has not experienced significant refunds to customers. The Company’s estimates related to revenue recognition may require significant judgment and the change in these estimates could have an effect on the Company’s results of operations during the periods involved. Contract Balances The timing of revenue recognition may differ from the timing of invoicing to customers and these timing differences result in receivables, contract assets, or contract liabilities (deferred revenue) on the Consolidated Balance Sheets. The Company records a contract asset when revenue is recognized prior to invoicing and records a deferred revenue liability when revenue is expected to be recognized after invoicing. For the Company’s breach services agreements, customers are typically invoiced at the beginning of the arrangement for the entire contract amount. When the breach agreement includes variable components related to as-incurred identity protection services, customers are invoiced monthly for the duration of the enrollment or call center period. Unbilled accounts receivable, which consists of services billed one month in arrears, was $ 7.8 million as of August 3, 2022. These unbilled amounts are included in accounts receivable as the Company has the unconditional right to receive this consideration. Contract assets are presented as other receivables within the Consolidated Balance Sheets and primarily relate to the Company’s rights to consideration for work completed but not billed on service contracts. Contract assets are transferred to receivables when the Company invoices the customer. Contract liabilities are presented as deferred revenue and relate to payments received for services that are yet to be recognized in revenue. During the period January 1, 2022, to August 3, 2022, the Company recognized $ 5.1 million of revenue that was included in deferred revenue at the end of the preceding year. All other deferred revenue activity is due to the timing of invoices in relation to the timing of revenue, as described above. The Company expects to recognize as revenue approximately 56 % of its August 3, 2022 , deferred revenue balance in the remainder of 2022, 29 % in the January 1, 2023 , to August 3, 2023, and the remainder thereafter. In instances where the timing of revenue recognition differs from the timing of invoicing, the Company determined that its contracts do not include a significant financing component. The primary purpose of invoicing terms is to provide customers with simplified and predictable ways of purchasing the Company's services and not to facilitate financing arrangements. Government Contracts The Company evaluates arrangements with governmental entities containing fiscal funding or termination for convenience provisions, when such provisions are required by law, to determine the probability of possible cancellation. The Company considers multiple factors including the history with the customer in similar transactions and the budgeting and approval processes undertaken by the governmental entity. If the Company determines upon execution of these arrangements that the likelihood of cancellation is remote, it then recognizes revenue for such arrangements once all relevant criteria have been met. If such a determination cannot be made, revenue is recognized upon the earlier of cash receipt or approval of the applicable funding provision by the governmental entity for such arrangements. | |
Research and Development | Research and Development Research and development expenses primarily consist of personnel costs and contractor fees related to the bundling of other third-party software products that are offered as one combined package within the Company’s product offerings. Personnel costs include salaries, bonuses, stock-based compensation, employer-paid payroll taxes, and an allocation of our facilities, benefits, and internal IT costs. Research and development costs are expensed as incurred. | |
Advertising | Advertising Advertising costs are expensed as incurred. Advertising costs amounted to $ 0.8 million for the period January 1, 2022, to August 3, 2022. | |
Income Taxes | n. Income Taxes The Company provides for income taxes using the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax effect of differences between recorded assets and liabilities and their respective tax basis along with operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to reverse. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period the rate change becomes effective. The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained in the event of a tax audit. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company records interest related unrecognized tax benefits in income tax expense. Deferred tax assets are reduced by a valuation allowance when in management’s opinion it is more likely than not that some portion or all the deferred tax assets will not be realized. The Company considers the future reversal of existing taxable temporary differences, taxable income in prior carryback years, projected future taxable income, and tax planning strategies in making this assessment. The Company’s valuation allowance is based on all available positive and negative evidence, including its recent financial operations, evaluation of positive and negative evidence with respect to certain specific deferred tax assets (including evaluating sources of future taxable income) to support the realization of the deferred tax assets. The Company's income tax returns are generally subject to examination by taxing authorities for a period of three years from the date they are filed. Tax authorities may have the ability to review and adjust net operating loss or tax credit carryforwards that were generated prior to these periods if utilized in an open tax year. As of August 3, 2022, the Company’s income tax returns for the years ended December 31, 2016 through 2021 are subject to examination by the Internal Revenue Service and applicable state and local taxing authorities. | |
Stock-Based Compensation | Stock-Based Compensation The Company grants stock options to purchase common stock to employees with exercise prices equal to the fair market value of the underlying stock as determined by the Board of Directors and management. The Board of Directors, with the assistance of outside valuation experts, determines the fair value of the underlying stock by considering several factors including historical and projected financial results, the risks the Company faced on the grant date, the preferences of the Company’s debt holders and preferred stockholders, and the lack of liquidity of the Company’s common stock. The fair value of each stock option award is estimated using the Black-Scholes-Merton valuation model. Such value is recognized as expense over the requisite service period using the straight-line method, net of forfeitures as they occur. Excess tax benefits of awards that relate to stock option exercises are reflected as operating cash inflows. Stock-based compensation expense recognized in the Company’s Consolidated Statements of Income for options were negligible for all periods presented. | |
Concentration of Credit Risk | m. Concentrations of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash balances and trade accounts receivable. The Company maintains cash balances at two financial institutions. The balances, at times, exceed federally insured limits. As of August 3, 2022, balances exceeded federally insured limits by $ 16.0 million. The Company has not experienced any losses in such accounts, and believes it is not exposed to any significant credit risk from cash. Concentrations of credit with respect to accounts receivables are generally limited due to the large number of customers, outside the U.S. Government, comprising the Company's customer base and their dispersion across different industries. The Company generated 73 % of its revenue in for the period January 1, 2022, to August 3, 2022, from the U.S. Government, who generally pays invoices in less than thirty days and is deemed to be a low credit risk. On August 3, 2022, accounts receivables from the U.S. Government made up 64 % of the Company’s outstanding accounts receivables. | |
Net Loss Per Share Attributable to Common Stockholders | Earnings (Loss) per Share Series A-1 and A-2 Preferred Stock are participating securities due to their rights to receive dividends. The Company calculates EPS under the two-class method. In the two-class method, all earnings (distributed and undistributed) are allocated to each class of common stock and participating securities. The allocation between common stock and participating securities is based upon the rights to dividends for the two types of securities. For periods of net income and when the effects are not anti-dilutive, the Company calculates diluted earnings per share by dividing net income available to common shareholders by the weighted average number of common shares plus the weighted average number of common shares assuming the conversion of the Company’s convertible notes, as well as the impact of all potentially dilutive common shares. Potentially dilutive common shares consist primarily of common stock options using the treasury stock method. For periods of net loss, shares used in the diluted earnings (loss) per share calculation equals the amount of shares in the basic EPS calculation as including potentially dilutive shares would be anti-dilutive. | |
Standards Issued and Adopted | r. Standards Issued and Adopted | |
Standards Issued, but Not Yet Effective | s. Standards Issued but Not Yet Effective In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). This guidance is intended to improve financial reporting for leasing transactions. The standard is effective for the Company for annual reporting periods beginning after December 15, 2021, and early adoption is permitted. Upon adoption, the Company will be required to record right-of-use assets and lease liabilities on its Consolidated Balance Sheets for leases which were historically classified as operating leases. The Company expects the adoption to have a material increase on the assets and liabilities recorded on its Consolidated Balance Sheets. The Company does not expect a material impact to its Consolidated Statement of Comprehensive Loss or Consolidated Statement of Cash Flows following adoption. In June 2016 the FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Instruments, which amends the accounting for credit losses for most financial assets and certain other instruments. The standard requires that entities holding financial assets that are not accounted for at fair value through net income be presented at the net amount expected to be collected. An allowance for credit losses will be a valuation account that will be deducted from the amortized cost basis of the financial asset to present the net carrying value at the amount expected to be collected on the financial asset. The standard is effective for the Company for annual reporting periods beginning in fiscal year 2023. The Company does not believe the adoption will have a material impact on its consolidated financial statements. In December 2019, the FASB issued ASU 2019-12, Simplifying the Accounting for Income Taxes (Topic 740). The amendments will remove certain exceptions for recognizing deferred taxes for investments, performing intra-period allocation and calculating income taxes in interim periods. The ASU also adds guidance to reduce complexity in certain areas, including recognizing deferred taxes for tax goodwill and allocating taxes to members of a consolidated group. The amendments are effective for annual periods beginning after December 15, 2021, and interim periods within annual periods beginning after December 15, 2022. IDX is currently evaluating the impact of ASU 2019-12 on its consolidated financial statements and related disclosures. In March 2020, the FASB issued ASU No. 2020-06, Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (Topics: 470-20, 815-40). The standards reduce the number of accounting models for convertible instruments and allows more contracts to qualify for equity classification. The standard also amends diluted EPS calculations for convertible instruments and amends the requirements for a contract (or embedded derivative) that is potentially settled in an entity’s own shares to be classified in equity. The standard is effective for the Company for all interim and annual periods of our fiscal year ending December 31, 2024. Early adoption is permitted. IDX is currently evaluating the impact of ASU 2020-06 on its consolidated financial statements. In August 2020, the FASB issued ASU 2020-06, Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40). ASU 2020-06 simplifies the accounting for convertible instruments by eliminating large sections of the existing guidance in this area. It also eliminates several triggers for derivative accounting, including a requirement to settle certain contracts by delivering registered shares. The standard is effective for the Company for all interim and annual periods of our fiscal year ending December 31, 2024. Early adoption is permitted. IDX is currently evaluating the impact of ASU 2020-06 on its consolidated financial statements. | |
Sales and Use Taxes | o. Sales and Use Taxes The Company collects sales tax in various jurisdictions. Upon collection from customers, it records the amount as a payable to the related jurisdiction. On a periodic basis, it files a sales tax return with the jurisdictions and remits the amounts indicated on the return. | |
Segment Reporting | p. Segment Reporting Operating segments are identified as components of an enterprise for which separate discrete financial information is available for evaluation by the chief operating decision maker, the chief executive officer, or decision-making group, in making decisions on how to allocate resources and assess performance. The Company views its operations and manages its business as one operating segment. All revenue has been generated and all assets are held in the United States. | |
Deferred Rent and Lease Incentives | q. Deferred Rent and Lease Incentives Rent expense and lease incentives from the Company’s operating leases are recognized on a straight-line basis over the lease term. The Company’s operating lease includes rent escalation payment terms and a rent-free period. Deferred rent represents the difference between actual operating lease payments and straight-line rent expense over the term of the lease. | |
Contract Costs | Contract Costs The Company capitalizes costs to obtain a contract or fulfill a contract. These costs are recorded as deferred contract acquisitions costs on the Consolidated Balance Sheets. Costs to obtain a contract for a new customer are amortized on a straight-line basis over the estimated period of benefit. The Company determined the estimated period of benefit by taking into consideration the contractual term. The Company periodically reviews the carrying amount of the capitalized contract costs to determine whether events or changes in circumstances have occurred that could affect the period of benefit. Amortization expense associated with costs to fulfill a contract is recorded to cost of services on the Consolidated Statements of Income. Amortization expense associated with costs to obtain a contract (sales commissions) is recorded to sales and marketing expense on the Consolidated Statements of Income. | |
Cost of Services | Cost of Services Cost of services consists of fees to outsourced service providers for credit monitoring, call center operation, notification mailing, insurance, and other miscellaneous services and internal labor costs. Costs incurred for breach service contracts represent fulfillment costs. These costs are deferred within capitalized contract costs and recognized in relation to revenue recorded over the combined service and membership terms. The remainder of cost of services are expensed as incurred. Relevant depreciation and amortization are included in cost of services on the Consolidated Statements of Income. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 7 Months Ended | 12 Months Ended |
Aug. 03, 2022 | Jan. 31, 2024 | |
Accounting Policies [Line Items] | ||
Revenue Earned by Timing of Revenue | The table below provides revenue earned by timing of revenue for the year ended January 31, 2024, the Successor Period, and the Predecessor Period (in thousands). Successor Predecessor Revenue Recognition Timing Year ended January 31, 2024 August 4, 2022 to February 1, 2022 to Over time $ 185,345 $ 79,025 $ 27,946 Point in time 47,955 9,361 1,291 Total $ 233,300 $ 88,386 $ 29,237 | |
Disaggregation of Revenue | The table below provides revenue earned by line of service for the year ended January 31, 2024, the Successor Period, and the Predecessor Period (in thousands). Successor Predecessor Revenue Line Year Ended January 31, 2024 August 4, 2022 to February 1, 2022 to Subscription revenue $ 89,308 $ 31,679 $ 27,946 Services revenue Breach 138,782 54,791 — Other services 5,210 1,916 1,291 Total services revenue 143,992 56,707 1,291 Total $ 233,300 $ 88,386 $ 29,237 The table below provides revenue earned based on geographic locations of our customers for the year ended January 31, 2024, the Successor Period, and the Predecessor Period (in thousands). Successor Predecessor Country Year Ended January 31, 2024 August 4, 2022 to February 1, 2022 to United States $ 214,423 $ 80,674 $ 21,916 Other 18,877 7,712 7,321 Total $ 233,300 $ 88,386 $ 29,237 | |
Changes in Fair Value of Warrants | A summary of the changes in the fair value of warrants for the year ended January 31, 2024, the Successor Period, the Predecessor Period, respectively, is as follows (in thousands): Successor Public Private Warrant liability - February 1, 2023 $ 1,373 $ 1,208 Issuance of warrants — 126 Gain due to change in fair value of warrants ( 1,297 ) ( 1,190 ) Warrant liability - January 31, 2024 $ 76 $ 144 Warrant liability - August 4, 2022 $ 4,226 $ 11,351 Exercise of warrants — ( 7,632 ) Gain due to change in fair value of warrants ( 2,853 ) ( 2,511 ) Warrant liability - January 31, 2023 $ 1,373 $ 1,208 Predecessor Warrant liability - January 31, 2022 $ 10,709 Issuance of warrants 519 Exercise of warrants ( 5,900 ) Loss due to change in fair value of warrants 2,059 Warrant liability - August 3, 2022 $ 7,387 | |
Schedule of Deferred Debt Issuance Costs | For the year ended January 31, 2024, the Successor Period, and the Predecessor Period, deferred debt issuance costs consisted of the following (in thousands): Successor Deferred debt issuance costs - February 1, 2023 $ 127 Direct costs paid 201 Amortization of debt issuance costs ( 117 ) Deferred debt issuance costs - January 31, 2024 $ 211 Deferred debt issuance costs - August 4, 2022 $ 120 Direct costs paid 31 Amortization of debt issuance costs ( 24 ) Deferred debt issuance costs - January 31, 2023 $ 127 Predecessor Deferred debt issuance costs - January 31, 2022 $ 1,627 Direct costs paid 118 Grant-date fair value of warrants issued 518 Amortization of debt issuance costs ( 378 ) Deferred debt issuance costs - August 3, 2022 $ 1,885 | |
Summary of Anti-dilutive Securities Excluded from Computation of Diluted Net Loss per Common Share | The following potentially dilutive securities were not included in the calculation of weighted average common shares outstanding, as their effects would have been anti-dilutive for the year ended January 31, 2024, the Successor Period, and the Predecessor Period. Successor Predecessor Year ended January 31, 2024 August 4, 2022 to February 1, 2022 to Preferred stock (on an as-converted basis) Series Seed redeemable convertible preferred stock — — 18,396,744 Series A redeemable convertible preferred stock — — 31,994,570 Series B redeemable convertible preferred stock — — 53,829,898 Series C redeemable convertible preferred stock — — 42,249,398 Series C-1 redeemable convertible preferred stock — — 22,790,767 Series D redeemable convertible preferred stock — — 27,743,094 Series D-1 redeemable convertible preferred stock — — 11,756,606 Series D-2 redeemable convertible preferred stock — — 1,987,736 Series E redeemable convertible preferred stock — — 30,490,064 Total common stock reserved — — 241,238,877 Common stock Purchase consideration liability shares 1,354,411 — — Sponsor earn-out shares 1,293,750 1,293,750 — Total common stock 2,648,161 1,293,750 — Warrants Common stock warrants 16,314,256 16,220,756 1,924,790 Series A redeemable convertible preferred stock warrants — — 249,806 Series B redeemable convertible preferred stock warrants — — 292,682 Series C-1 redeemable convertible preferred stock warrants — — 1,247,369 Series E redeemable convertible preferred stock warrants — — 2,079,870 Total warrants 16,314,256 16,220,756 5,794,517 Options to purchase common stock Issued and outstanding 6,917,053 7,926,307 22,178,814 Restricted stock units Issued and outstanding 8,013,568 747,405 — | |
Summary of Receivables, Net of Allowance for Doubtful Accounts | As of January 31, 2023 and 2022, the Company’s accounts receivable consisted of the following (in thousands): January 31, 2024 January 31, 2023 Accounts receivable, billed $ 30,912 $ 22,296 Accounts receivable, unbilled 8,212 7,458 Less: Allowance for doubtful accounts ( 201 ) ( 145 ) Accounts receivable, net $ 38,923 $ 29,609 | |
Summarizes Activity for Allowance for Doubtful Accounts | Activity in the allowance for doubtful accounts for the year ended January 31, 2024, and the Successor Period, was as follows (in thousands): January 31, 2024 January 31, 2023 Balance at beginning of period $ 145 $ 133 Charged to cost and expenses 118 32 Write-offs and recoveries ( 62 ) ( 20 ) Balance at end of period $ 201 $ 145 | |
Summary of Deferred Contract Acquisition Costs Activity | A summary of deferred contract acquisition costs activity for the year ended January 31, 2024, and the Successor Period, is as follows (in thousands): Deferred contract acquisition costs - February 1, 2023 $ 13,207 Purchase accounting adjustment ( 8,834 ) Capitalization of contract acquisition costs 12,334 Amortization of deferred contract acquisition costs ( 6,601 ) Deferred contract acquisition costs - January 31, 2024 $ 10,106 Deferred contract acquisition costs, current $ 5,351 Deferred contract acquisition costs, net of current portion 4,755 Deferred contract acquisition costs - January 31, 2024 $ 10,106 Deferred contract acquisition costs - August 4, 2022 $ 12,091 Capitalization of contract acquisition costs 4,915 Amortization of deferred contract acquisition costs ( 3,799 ) Deferred contract acquisition costs - January 31, 2023 $ 13,207 Deferred contract acquisition costs, current $ 5,456 Deferred contract acquisition costs, net of current portion 7,751 Deferred contract acquisition costs - January 31, 2023 $ 13,207 | |
Summary of Estimated Useful Lives for Property and Equipment | The estimated useful lives for significant property and equipment categories are as follows: Asset Classification Estimated Useful Life Computer hardware and purchased software 2 - 3 years Furniture and fixtures 3 - 7 years Leasehold improvements Lesser of lease term or useful life | |
Schedule of Future Amortization Expense for Software Development Costs Capitalized | Future amortization expense for software development costs capitalized as of January 31, 2024, is as follows (in thousands): 2025 $ 165 2026 138 2027 39 Total $ 342 | |
ID Experts Holdings, Inc. and Subsidiary [Member] | ||
Accounting Policies [Line Items] | ||
Disaggregation of Revenue | The following table illustrates the timing of the Company’s revenue recognition: January 1, 2022, to August 3, 2022 Breach - point in time 12.6 % Breach - over time 83.4 % Membership services - over time 4.0 % |
Revenue from Contracts with C_2
Revenue from Contracts with Customers (Tables) | 7 Months Ended | 12 Months Ended |
Aug. 03, 2022 | Jan. 31, 2024 | |
Disaggregation of Revenue [Line Items] | ||
Disaggregation of Revenue | The table below provides revenue earned by line of service for the year ended January 31, 2024, the Successor Period, and the Predecessor Period (in thousands). Successor Predecessor Revenue Line Year Ended January 31, 2024 August 4, 2022 to February 1, 2022 to Subscription revenue $ 89,308 $ 31,679 $ 27,946 Services revenue Breach 138,782 54,791 — Other services 5,210 1,916 1,291 Total services revenue 143,992 56,707 1,291 Total $ 233,300 $ 88,386 $ 29,237 The table below provides revenue earned based on geographic locations of our customers for the year ended January 31, 2024, the Successor Period, and the Predecessor Period (in thousands). Successor Predecessor Country Year Ended January 31, 2024 August 4, 2022 to February 1, 2022 to United States $ 214,423 $ 80,674 $ 21,916 Other 18,877 7,712 7,321 Total $ 233,300 $ 88,386 $ 29,237 | |
Summary of Components of Contract Assets and Liabilities and Significant Components of Changes in Contract Liabilities | The components of contract assets and liabilities consist of the following (in thousands): January 31, 2024 January 31, 2023 Assets: Accounts receivable, net $ 38,923 $ 29,609 Deferred contract acquisition costs, current and non-current 10,106 13,207 Liabilities: Deferred revenue, current and non-current $ 86,846 $ 53,958 | |
ID Experts Holdings, Inc. and Subsidiary [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Disaggregation of Revenue | The following table illustrates the timing of the Company’s revenue recognition: January 1, 2022, to August 3, 2022 Breach - point in time 12.6 % Breach - over time 83.4 % Membership services - over time 4.0 % | |
Summary of Breach Revenue From Contract with Customers | The following table summarizes breach revenue from contracts with customers for the period January 1, 2023, to August 3, 2022, (in thousands): January 1, 2022, to August 3, 2022 Notification services $ 8,386 Call center and monitoring services 55,692 Total breach services $ 64,078 | |
Summary of Total Value of Remaining Performance Obligations | The approximate percentages expected to be recognized as revenue in the future are as follows (in thousands, except percentages): 0- 12 Months 13- 24 Months Over 24 Months Total Remaining Performance Obligations Breach services 98 % 2 % 0 % $ 85,932 Consumer membership services 100 % 0 % 0 % 678 Total 98 % 2 % 0 % $ 86,610 |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 12 Months Ended |
Jan. 31, 2024 | |
Property, Plant and Equipment [Line Items] | |
Summary of Property and Equipment, Net | Property and equipment as of January 31, 2024 and 2023, consists of the following (in thousands): January 31, 2024 January 31, 2023 Computer hardware and purchased software $ 2,495 $ 907 Furniture and fixtures 8 20 Leasehold improvements 202 114 Total property and equipment 2,705 1,041 Less: accumulated depreciation ( 1,507 ) ( 370 ) Property and equipment, net $ 1,198 $ 671 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Jan. 31, 2024 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |
Summary of Assets (Liabilities) Carried at Fair Value | The following table sets forth by level within the fair value hierarchy the liabilities carried at fair value (in thousands): Fair value measurements at January 31, 2024 using: Level 1 Level 2 Level 3 Total Liabilities: Public warrants $ ( 76 ) $ — $ — $ ( 76 ) Private warrants — ( 67 ) ( 77 ) ( 144 ) Sponsor earnout shares — — ( 392 ) ( 392 ) Purchase consideration liability ( 3,499 ) — ( 863 ) ( 4,362 ) Total financial liabilities $ ( 3,575 ) $ ( 67 ) $ ( 1,332 ) $ ( 4,974 ) The following table sets forth by level within the fair value hierarchy the assets (liabilities) carried at fair value (in thousands): Fair value measurements at January 31, 2023 using: Level 1 Level 2 Level 3 Total Assets: Cash equivalents - money market funds $ 557 $ — $ — $ 557 Total financial assets $ 557 $ — $ — $ 557 Liabilities: Public warrants $ ( 1,373 ) $ — $ — $ ( 1,373 ) Private warrants — ( 1,208 ) — ( 1,208 ) Sponsor earnout shares — — ( 2,445 ) ( 2,445 ) Total financial liabilities $ ( 1,373 ) $ ( 1,208 ) $ ( 2,445 ) $ ( 5,026 ) |
Acquisitions (Tables)
Acquisitions (Tables) | 12 Months Ended |
Jan. 31, 2024 | |
Zero Fox [Member] | |
Business Acquisition [Line Items] | |
Summary of Estimated Fair value of Purchase Consideration Paid | The following table summarizes the fair value of the purchase consideration paid to affect the merger of ZeroFox, Inc. (in thousands, except per share data): Equity value of consideration Common stock issued to holders of ZeroFox, Inc. 82,030,308 Closing price per share of the Company's Common Stock (ZFOX) on August 3, 2022 $ 10.95 Fair value of Common Stock issued $ 898,232 Cash consideration Repayment of ZeroFox, Inc. debt and interest 37,674 Payment of ZeroFox, Inc. transaction expenses 8,500 Repayment of notes payable to PIPE Investors 5,000 Total consideration paid $ 949,406 |
Summary of Preliminary Allocation of Purchase Price | The Company recorded the allocation of the purchase price to ZeroFox, Inc.'s assets acquired and liabilities assumed based on their fair values as of August 3, 2022. The final purchase price allocation is as follows (in thousands): Cash and cash equivalents $ 2,806 Accounts receivable 13,961 Prepaid expenses and other assets 2,201 Property and equipment 598 Other assets 341 Goodwill 828,091 Intangible assets 185,000 Total assets acquired 1,032,998 Accounts payable 4,310 Accrued liabilities 3,921 Current portion of long term debt 938 Deferred revenue, current 35,432 Deferred revenue, net of current portion 6,325 Long term debt 16,851 Warrants liabilities 7,632 Deferred tax liability 8,183 Total liabilities assumed 83,592 Total consideration transferred $ 949,406 |
IDX [Member] | |
Business Acquisition [Line Items] | |
Summary of Estimated Fair value of Purchase Consideration Paid | The following table summarizes the fair value of the purchase consideration paid to affect the merger of IDX (in thousands, except per share data): Equity value consideration Common stock issued to holders of IDX 27,849,942 Closing price per share of the Company's Common Stock (ZFOX) on August 3, 2022 $ 10.95 Fair value of Common Stock issued $ 304,957 Cash consideration paid to IDX shareholders 44,447 Cash consideration gross up for offset of PIPE subscribers also IDX holders 5,000 Repayment of debt and interest 12,484 Payment of IDX transaction expenses 1,500 Total consideration paid $ 368,388 |
Summary of Preliminary Allocation of Purchase Price | The Company recorded the allocation of the purchase price to IDX's assets acquired and liabilities assumed based on their fair values as of August 3, 2022. The following table sets forth the amounts allocated to the intangible assets identified, the estimated useful lives of those intangible assets, and the methodologies used to determine the fair values of those intangible assets (dollars in thousands): Cash and cash equivalents $ 13,727 Accounts receivable 11,944 Prepaid and other expense 2,939 Property and equipment 125 Goodwill 285,970 Intangible Assets 100,500 Total assets acquired 415,205 Accounts payable $ 7,568 Accrued liabilities 4,944 Deferred revenue, current 9,314 Deferred revenue, net of current portion 1,522 Deferred tax liability 23,469 Total liabilities assumed 46,817 Total consideration transferred $ 368,388 |
LGCS [Member] | |
Business Acquisition [Line Items] | |
Summary of Estimated Fair value of Purchase Consideration Paid | The following table summarizes the estimated fair value of the purchase consideration (in thousands, except per share data): Purchase consideration liability: Purchase consideration shares LookingGlass Earnout Shares 1,837,500 LookingGlass Deferred Shares 6,791,456 Total purchase consideration shares 8,628,956 Adjusted closing price per share of the Company's Common Stock (ZFOX) on April 21, 2023 $ 1.10 Fair value of purchase consideration liability $ 9,465 Cash consideration $ 9,500 Convertible note 3,333 Total purchase consideration $ 22,298 |
Summary of Preliminary Allocation of Purchase Price | The Company recorded the preliminary allocation of the purchase price to LookingGlass' assets acquired and liabilities assumed based on their fair values as of April 21, 2023. The preliminary purchase price allocation is as follows (in thousands): Cash and cash equivalents $ 1,608 Accounts receivable 3,233 Prepaid expenses and other assets 1,562 Property and equipment, net 1,627 Operating lease right-of-use assets 656 Goodwill 4,832 Intangible assets 17,900 Deferred tax assets 6,515 Total assets acquired $ 37,933 Accounts payable $ 1,304 Accrued compensation, accrued expenses, and other current liabilities 2,279 Operating lease liabilities, current 584 Deferred revenue, current 10,850 Other liabilities 524 Operating lease liabilities, net of current portion 94 Total liabilities assumed 15,635 Total consideration transferred $ 22,298 |
Summary of Intangible Assets Identified, Estimated Useful Lives and Methodologies Used to Determine Fair Values | The following table sets forth the amounts allocated to the intangible assets identified, the estimated useful lives of those intangible assets, and the methodologies used to determine the fair values of those intangible assets (dollars in thousands): Fair Value Useful Life (in years) Fair Value Methodology Customer relationships $ 13,700 10 Multi-period Excess Earnings method of the Income Approach Developed technology 4,000 7 Relief from Royalty method Trade names and trademarks 200 2 Relief from Royalty method $ 17,900 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Jan. 31, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Changes in Fair Value of Goodwill | A summary of the changes in the fair value of goodwill for the year ended January 31, 2024, the Successor Period, and the Predecessor Period, respectively, is as follows (in thousands): Successor Goodwill (gross) - January 31, 2023 $ 1,105,258 Accumulated impairment loss ( 698,650 ) Goodwill (net) - January 31, 2023 406,608 Business acquisition 4,832 Adjustment to purchase accounting from the Business Combination 6,900 Impairment ( 284,240 ) Goodwill (net) - January 31, 2024 $ 134,100 Predecessor Goodwill (gross) - January 31, 2022 $ 35,002 Accumulated impairment loss - Goodwill (net) - August 3, 2022 $ 35,002 |
Summary of Intangible Assets | The tables below summarize the Company’s intangible assets as of January 31, 2024, and 2023 (amounts in thousands, except for useful lives). As of January 31, 2024 Weighted Average Useful Life (in years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Customer relationships 7.8 $ 168,100 $ ( 35,174 ) $ 132,926 Developed technology 5.1 99,800 ( 29,028 ) $ 70,772 Trademarks / trade names 10.0 35,500 ( 5,344 ) $ 30,156 $ 303,400 $ ( 69,546 ) $ 233,854 As of January 31, 2023 Weighted Average Useful Life (in years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Customer relationships 8.6 $ 154,400 $ ( 11,894 ) $ 142,506 Developed technology 5.0 95,800 ( 9,425 ) 86,375 Trademarks / trade names 10.0 35,300 ( 1,737 ) 33,563 $ 285,500 $ ( 23,056 ) $ 262,444 |
Summary of Future Amortization of Intangible Assets | The tables below summarizes the future amortization of the Company’s intangible assets as of January 31, 2024 (amounts in thousands). Fiscal 2025 $ 44,981 Fiscal 2026 44,904 Fiscal 2027 44,881 Fiscal 2028 35,456 Fiscal 2029 20,515 Thereafter 43,117 Total amortization of intangible assets expense $ 233,854 |
Summary of Recognized Amortization of Intangible Assets Expense Recognized in Condensed Consolidated Statements of Comprehensive Loss | The Company recognized amortization of intangible assets expense in the accompanying Consolidated Statements of Comprehensive Loss for the year ended January 31, 2024, the Successor Period, and the Predecessor Period, as follows (in thousands): Successor Predecessor Year Ended January 31, 2024 August 4, 2022 to February 1, 2022 to Cost of revenue - subscription $ 19,603 $ 9,425 $ 260 Sales and marketing 23,280 11,894 1,308 General and administrative 3,607 1,737 36 Total amortization of acquired intangible assets $ 46,490 $ 23,056 $ 1,604 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Jan. 31, 2024 | |
Lessee, Lease, Description [Line Items] | |
Summary of Supplemental Balance Sheet Information Related to Lease Liabilities | Supplemental balance sheet information related to lease liabilities is as follows: (in thousands, except lease term and discount rate) January 31, 2024 January 31, 2023 Operating leases Operating ROU assets $ 3,553 $ 720 Operating lease liabilities, current $ 1,638 $ 406 Operating lease liabilities, net of current portion 2,111 427 Total operating lease liabilities $ 3,749 $ 833 Weighted average remaining lease term 2.4 years 1.7 years Weighted average discount rate 7.1 % 4.8 % |
Summary of Future Minimum Lease Payments Under Non-cancelable Operating Leases | Maturities of operating lease liabilities at January 31, 2024 is as follows: (in thousands) Year ending January 31, 2025 $ 1,863 2026 1,409 2027 760 2028 82 Total lease payments 4,114 Less: imputed interest ( 365 ) Total lease payments $ 3,749 |
Long-term Debt (Tables)
Long-term Debt (Tables) | 12 Months Ended |
Jan. 31, 2024 | |
Debt Instrument [Line Items] | |
Summary of Debt | The tables below summarize key terms of the Company’s debt that was outstanding as of January 31, 2024 and 2023 (amounts in thousands, except for interest rates). As of January 31, 2024 Lender Stated Effective Gross Unamortized Unamortized Net Stifel Bank 9.50 % 9.86 % $ 22,500 $ ( 83 ) $ ( 52 ) $ 22,365 InfoArmor 5.50 % 5.50 % 1,406 — — 1,406 Convertible notes 7.00 % Cash / 8.75 % PIK 9.78 % 170,738 — ( 77 ) 170,661 Alsop Louie Convertible Note (1) 6.00 % 3.36 % 3,333 — — 3,333 $ 197,977 $ ( 83 ) $ ( 129 ) $ 197,765 Current portion of long-term debt $ 938 Long-term debt 196,827 $ 197,765 (1) Per the note agreement, the note is interest free for the first twelve months and bears interest at a rate of 6 % per annum thereafter. As of January 31, 2023 Lender Stated Effective Gross Unamortized Unamortized Net Stifel Bank 8.50 % 8.50 % $ 15,000 $ — $ — $ 15,000 InfoArmor 5.50 % 5.50 % 2,344 — — 2,344 Convertible notes 7.00 % Cash / 8.75 % PIK 8.53 % 156,564 — ( 127 ) 156,437 $ 173,908 $ — $ ( 127 ) $ 173,781 Current portion of long-term debt $ 15,938 Long-term debt 157,843 $ 173,781 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Jan. 31, 2024 | |
Debt Disclosure [Abstract] | |
Summary of Debt | The tables below summarize key terms of the Company’s debt that was outstanding as of January 31, 2024 and 2023 (amounts in thousands, except for interest rates). As of January 31, 2024 Lender Stated Effective Gross Unamortized Unamortized Net Stifel Bank 9.50 % 9.86 % $ 22,500 $ ( 83 ) $ ( 52 ) $ 22,365 InfoArmor 5.50 % 5.50 % 1,406 — — 1,406 Convertible notes 7.00 % Cash / 8.75 % PIK 9.78 % 170,738 — ( 77 ) 170,661 Alsop Louie Convertible Note (1) 6.00 % 3.36 % 3,333 — — 3,333 $ 197,977 $ ( 83 ) $ ( 129 ) $ 197,765 Current portion of long-term debt $ 938 Long-term debt 196,827 $ 197,765 (1) Per the note agreement, the note is interest free for the first twelve months and bears interest at a rate of 6 % per annum thereafter. As of January 31, 2023 Lender Stated Effective Gross Unamortized Unamortized Net Stifel Bank 8.50 % 8.50 % $ 15,000 $ — $ — $ 15,000 InfoArmor 5.50 % 5.50 % 2,344 — — 2,344 Convertible notes 7.00 % Cash / 8.75 % PIK 8.53 % 156,564 — ( 127 ) 156,437 $ 173,908 $ — $ ( 127 ) $ 173,781 Current portion of long-term debt $ 15,938 Long-term debt 157,843 $ 173,781 |
Other Liabilities (Tables)
Other Liabilities (Tables) | 12 Months Ended |
Jan. 31, 2024 | |
Other Liabilities [Line Items] | |
Summary of Other Liabilities | Other liabilities consists of warrants, sponsor earnout shares, purchase consideration liability, deferred tax liability (see Note 14), and other, as follows: January 31, 2024 January 31, 2023 Purchase consideration liability $ 4,362 $ — Deferred tax liability 4,219 21,638 Other 2,117 954 Sponsor earnout shares 392 2,445 Warrants 220 2,581 Total other liabilities $ 11,310 $ 27,618 |
Summary of Assumptions Used in Estimating Fair Values of Warrants | The fair value of the Stifel Warrant was determined using a Black-Scholes model. The assumptions used in estimating the fair value of the Stifel Warrant are included in the table below. There are no values as of January 31, 2023, as the warrant was issued on April 21, 2023. January 31, 2024 April 21, 2023 Asset price $ 0.88 $ 1.32 Exercise price of the warrant $ 1.36 $ 1.36 Contractual term 9.2 10.0 Volatility 67.50 % 65.00 % Dividend yield 0.00 % 0.00 % Risk-free rate 4.00 % 3.60 % |
Summary of Fair Value of Purchase Consideration Liability | The calculation of the fair value of the purchase consideration liability is included in the table below (in thousands, except share and per share data). There is no balance as of January 31, 2023, as the LookingGlass Business Acquisition occurred on April 21, 2023. January 31, 2024 Purchase consideration shares 8,766,264 Distributed Tranche I purchase consideration shares ( 3,810,108 ) Remaining purchase consideration shares 4,956,156 Closing price per share of the Company's Common Stock (ZFOX) $ 0.88 Fair value of remaining purchase consideration liability $ 4,362 |
Sponsor Earn-out Shares [Member] | |
Other Liabilities [Line Items] | |
Summary of Assumptions Used in Estimating Fair Values of Warrants | The table below documents the Monte Carlo assumptions, inputs, and the fair value results at each balance sheet date: January 31, 2024 January 31, 2023 Per Share Price of Company Common Stock $ 0.88 $ 3.62 Annual Equity Volatility 97.50 % 65.00 % Risk-Free Rate of Return 4.01 % 3.70 % Fair Value per Share Tranche I $ 0.33 $ 2.12 Fair Value per Share Tranche II $ 0.30 $ 1.88 Fair Value per Share Tranche III $ 0.28 $ 1.67 Aggregate Fair Value (in thousands) $ 392 $ 2,445 |
Sponsor Earnout Shares (Tables)
Sponsor Earnout Shares (Tables) | 12 Months Ended |
Jan. 31, 2024 | |
Sponsor Earnout Shares [Line Items] | |
Summary of Assumptions, Inputs, and Fair Value Results | The fair value of the Stifel Warrant was determined using a Black-Scholes model. The assumptions used in estimating the fair value of the Stifel Warrant are included in the table below. There are no values as of January 31, 2023, as the warrant was issued on April 21, 2023. January 31, 2024 April 21, 2023 Asset price $ 0.88 $ 1.32 Exercise price of the warrant $ 1.36 $ 1.36 Contractual term 9.2 10.0 Volatility 67.50 % 65.00 % Dividend yield 0.00 % 0.00 % Risk-free rate 4.00 % 3.60 % |
Sponsor Earnout Shares [Member] | |
Sponsor Earnout Shares [Line Items] | |
Summary of Assumptions, Inputs, and Fair Value Results | The table below documents the Monte Carlo assumptions, inputs, and the fair value results at each balance sheet date: January 31, 2024 January 31, 2023 Per Share Price of Company Common Stock $ 0.88 $ 3.62 Annual Equity Volatility 97.50 % 65.00 % Risk-Free Rate of Return 4.01 % 3.70 % Fair Value per Share Tranche I $ 0.33 $ 2.12 Fair Value per Share Tranche II $ 0.30 $ 1.88 Fair Value per Share Tranche III $ 0.28 $ 1.67 Aggregate Fair Value (in thousands) $ 392 $ 2,445 |
Income Taxes (Tables)
Income Taxes (Tables) | 7 Months Ended | 12 Months Ended |
Aug. 03, 2022 | Jan. 31, 2024 | |
Income Tax Disclosure [Line Items] | ||
Summary of Components of Loss Before Income Taxes | U.S. and foreign components of the loss before income taxes for the year ended January 31, 2024, the Successor Period, and the Predecessor Period, were as follows (in thousands): Successor Predecessor Year ended August 4, 2022 to February 1, 2022 to U.S. loss $ ( 366,162 ) $ ( 734,326 ) $ ( 19,370 ) Foreign income (loss) 2,106 3,157 ( 1,924 ) Total loss before income taxes $ ( 364,056 ) $ ( 731,169 ) $ ( 21,294 ) | |
Summary of Provision for Income Taxes | The provision for consolidated income taxes for the year ended January 31, 2024, the Successor Period, and the Predecessor Period, were as follows (in thousands): Successor Predecessor Year ended August 4, 2022 to February 1, 2022 to Current tax expense Federal $ ( 185 ) $ — $ — Foreign 313 177 106 State and local 627 292 5 755 469 111 Deferred tax expense Federal ( 15,111 ) ( 9,360 ) ( 2,780 ) Foreign — — — State and local ( 3,527 ) ( 2,281 ) ( 911 ) ( 18,638 ) ( 11,641 ) ( 3,691 ) Less: change in valuation allowance 10,137 650 3,691 Net income tax (benefit) expense $ ( 7,746 ) $ ( 10,522 ) $ 111 | |
Summary of Differences as Result of which Income Tax Provision Differs from Amount Computed by Applying Statutory Federal Income Tax Rate to Income (Loss) Before Income Tax | A reconciliation of the statutory US income tax rate to the effective income tax rate for the year ended January 31, 2024, the Successor Period, and the Predecessor Period, as follows: Successor Predecessor Year ended August 4, 2022 to February 1, 2022 to U.S. statutory rate 21.00 % 21.00 % 21.00 % State taxes 0.63 0.21 3.35 Foreign taxes ( 0.09 ) — — Goodwill impairment ( 16.40 ) ( 20.07 ) — Transaction costs — — ( 3.23 ) Fair value adjustments — — ( 2.03 ) Other permanent differences ( 0.27 ) 0.41 ( 1.05 ) Change in valuation allowance ( 2.78 ) ( 0.09 ) ( 17.32 ) Other 0.04 ( 0.02 ) ( 1.24 ) Net income tax expense 2.13 % 1.44 % - 0.52 % | |
Summary of Temporary Differences that Give Rise to Deferred Tax Assets and Liabilities | Deferred income taxes reflect temporary differences in the recognition of revenue and expenses for income tax reporting and consolidated financial statement purposes. Deferred income taxes as of January 31, 2024, and 2023, consisted of the following (in thousands): January 31, 2024 January 31, 2023 Deferred tax assets: Net operating losses - federal and state $ 54,332 $ 36,057 Research and development expenditures 13,128 4,793 Deferred revenue 1,756 3,019 Interest expense 9,052 2,544 Accruals 1,196 1,240 Capital loss carryforward 1,788 — Credits 2,667 — Stock-based compensation 709 574 Other 665 308 Lease liability 910 204 Depreciation and amortization ( 28 ) 112 Allowance for doubtful accounts 48 35 Charitable contributions 6 3 Total deferred tax assets before valuation allowance 86,229 48,889 Valuation allowance ( 33,702 ) ( 5,720 ) Total deferred tax assets 52,527 43,169 Deferred tax liabilities: Intangible assets ( 52,333 ) ( 61,109 ) Contract acquisition costs ( 2,392 ) ( 3,256 ) Goodwill ( 701 ) ( 258 ) Right-of-use assets ( 862 ) ( 177 ) Other ( 458 ) ( 7 ) Total deferred tax liabilities ( 56,746 ) ( 64,807 ) Net deferred tax liability $ ( 4,219 ) $ ( 21,638 ) The net deferred tax liability is included within Other liabilities on the Company's balance sheet at January 31, 2024 and January 31, 2023. The Company recognizes the tax benefit of a position when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, based on the technical merits of the position. Income tax positions must meet a more-likely-than-not recognition threshold at the effective date to be recognized. At January 31, 2024, the Company recorded gross unrecognized tax benefits of approximately $ 1.8 million, all of which, if recognized, would impact the Company's effective tax rate. Interest and penalties accrued related to uncertain tax positions were $ 0.3 million at January 31, 2024. The Company anticipates a $ 0.1 million decrease in unrecognized tax benefits within the next 12 months from the expiration of statute of limitations. Gross unrecognized tax benefits are i ncluded within Other liabilities on the Company's balance sheet at January 31, 2024 and January 31, 2023. The change in gross unrecognized tax benefits, excluding accrued interest and penalties, were as follows (in thousands): January 31, 2024 January 31, 2023 Balance at beginning of period $ 838 $ — Business Combination — 838 Adjustments to the Business Combination 460 — Business acquisition 472 — Current period adjustments 252 — Settlement with tax authorities ( 80 ) — Statute expirations ( 174 ) — Balance at end of period $ 1,768 $ 838 | |
Summary of Valuation Allowance of Deferred Tax Assets | he following table provides a rollforward of the Company’s valuation allowance for its deferred tax assets (in thousands): January 31, 2024 January 31, 2023 Balance at beginning of period $ 5,720 $ 5,070 Increases to allowance 10,137 650 Increases due to business acquisition 17,845 — Balance at end of period $ 33,702 $ 5,720 | |
ID Experts Holdings, Inc. and Subsidiary [Member] | ||
Income Tax Disclosure [Line Items] | ||
Summary of Provision for Income Taxes | The provision for income taxes for the period January 1, 2022, to August 3, 2022, are as follows (in thousands): January 1, 2022, to August 3, 2022 Federal $ 1,645 State 361 Total current tax expense 2,006 Deferred tax benefit: Federal ( 1,129 ) State ( 225 ) Total deferred tax benefit ( 1,354 ) Income tax expense $ 652 | |
Summary of Differences as Result of which Income Tax Provision Differs from Amount Computed by Applying Statutory Federal Income Tax Rate to Income (Loss) Before Income Tax | The income tax provision differs from the amount computed by applying the statutory federal income tax rate of 21 % to the loss before income tax as a result of the following differences (in thousands): January 1, 2022, to August 3, 2022 Income taxes at statutory rate $ ( 43 ) State income tax, net of federal benefit ( 12 ) Permanent items 4 Non-deductible transaction costs 625 Non-deductible convertible debt and warrant expense 150 Stock-based compensation ( 145 ) Tax credits ( 25 ) Loss of attributes 25 Uncertain tax positions 106 Other ( 21 ) Valuation allowance ( 12 ) Income tax expense $ 652 |
Accrued Compensation, Accrued_2
Accrued Compensation, Accrued Expenses, and Other Current Liabilities (Tables) | 12 Months Ended |
Jan. 31, 2024 | |
Accrued Expense Details [Line Items] | |
Summary of Accrued Expenses | Accrued compensation, accrued expenses, and other current liabilities as of January 31, 2024 and 2023, consists of the following (in thousands): January 31, 2024 January 31, 2023 Other current liabilities $ 10,521 $ 12,110 Accrued bonuses 3,374 3,893 Accrued commissions 1,988 1,408 Accrued employee compensation 1,243 1,340 Total accrued compensation, accrued expenses, and other current liabilities $ 17,126 $ 18,751 |
Common Stock, Redeemable Conv_2
Common Stock, Redeemable Convertible Preferred Stock, and Stockholders' Equity (Deficit (Tables) | 12 Months Ended |
Jan. 31, 2024 | |
Temporary Equity [Abstract] | |
Schedule of Common Stock Reserved for Future Issuance | The Company’s and Predecessor's common stock reserved for future issuance is as follows: January 31, 2024 January 31, 2023 Common stock warrants 16,342,106 16,213,430 Stock options issued and outstanding 6,484,992 7,869,050 Restricted stock units issued and outstanding 10,751,337 2,802,426 Sponsor earn-out shares 1,293,750 1,293,750 Shares available for future grant under the 2022 plan 12,858,387 15,829,510 47,730,572 44,008,166 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 7 Months Ended | 12 Months Ended |
Aug. 03, 2022 | Jan. 31, 2024 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Summary of Stock Option Activity | A summary of option activity for the Successor Period and the Predecessor Period, is as follows (Aggregate Intrinsic Value in thousands): Successor Shares Weighted- Weighted- Aggregate Outstanding as of January 31, 2023 7,869,050 $ 1.5454 6.07 $ 16,325 Granted — — Exercised ( 1,003,474 ) 0.2565 Cancelled ( 380,584 ) 4.0963 Outstanding as of January 31, 2024 6,484,992 1.5856 4.96 1,131 Vested as of January 31, 2024 5,814,238 1.2651 4.67 1,055 Vested and expected to vest as 6,250,237 $ 1.4812 4.86 $ 1,104 Successor Shares Weighted- Weighted- Aggregate Outstanding as of August 4, 2022 8,159,377 $ 1.5360 6.01 $ 17,004 Granted — — Exercised ( 206,476 ) 0.5952 Cancelled ( 83,851 ) 2.9681 Outstanding as of January 31, 2023 7,869,050 1.5454 6.07 16,325 Vested as of January 31, 2023 5,772,232 0.9591 5.39 15,359 Vested and expected to vest as 7,135,156 $ 1.3793 5.88 $ 15,987 Predecessor Shares Weighted- Weighted- Aggregate Outstanding as of February 1, 2022 21,715,815 $ 0.4398 6.28 $ 51,688 Granted 1,214,500 2.3920 Exercised ( 392,450 ) 0.2659 Cancelled ( 252,159 ) 1.4633 Outstanding as of August 3, 2022 22,285,706 0.5377 6.45 50,864 Vested as of August 3, 2022 14,783,495 0.2660 5.41 37,757 Vested and expected to vest as 19,659,894 $ 0.4662 6.17 $ 46,276 The Company did no t grant any options during the year ended January 31, 2024, or the Successor Period. | |
Summary of RSU Activity | A summary of RSU activity for the Successor Period is as follows: Shares Weighted-Average Outstanding as of January 31, 2023 2,802,426 $ 4.64 Granted 10,038,454 $ 1.29 Vested ( 1,635,418 ) $ 3.29 Cancelled ( 454,125 ) $ 2.98 Outstanding as of January 31, 2024 10,751,337 $ 1.79 Shares Weighted-Average Outstanding as of August 4, 2022 — $ — Granted 2,827,426 $ 4.64 Vested — $ — Cancelled ( 25,000 ) $ 4.63 Outstanding as of January 31, 2023 2,802,426 $ 4.64 | |
Summary of Stock-Based Compensation Expense | The Company recognized non-cash, stock-based compensation expense in the accompanying Consolidated Statements of Comprehensive Loss for the year ended January 31, 2024, the Successor Period, and the Predecessor Period, as follows (in thousands): Successor Predecessor Year ended August 4, 2022 to February 1, 2022 to Cost of revenue - subscription $ 219 $ 97 $ 18 Cost of revenue - services 111 36 2 Research and development 1,637 452 114 Sales and marketing 1,612 518 218 General and administrative 3,946 1,397 510 Total stock-based compensation expense $ 7,525 $ 2,500 $ 862 | |
ID Experts Holdings, Inc. and Subsidiary [Member] | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Summary of Weighted-average Assumptions | Assumptions January 1, 2022, to August 3, 2022 Weighted-average risk-free rate 2.20 % Weighted-average expected term of the option (in years) 7.0 Weighted-average expected volatility 35.00 % Weighted-average dividend yield 0.00 % | |
Summary of Stock Option Activity | Stock option activity during the period January 1, 2022, to August 3, 2022, is as follows: (Aggregate Intrinsic Value in thousands) Shares Weighted- Weighted- Aggregate Outstanding as of January 1, 2022 2,843,372 $ 0.14 7.3 $ 5,768 Granted 72,500 1.97 Exercised ( 272,766 ) 0.04 Cancelled ( 62,424 ) 0.38 Outstanding as of August 3, 2022 2,580,682 $ 0.20 6.5 $ 11,998 Vested as of August 3, 2022 1,556,944 $ 0.17 5.3 $ 7,300 The weighted average grant date fair value of options exercised during the period January 1, 2022, to August 3, 2022, was $ 0.04 . The intrinsic value of options exercised during the period January 1, 2022, to August 3, 2022, was $ 1.3 million. The fair value of shares vested during the period January 1, 2022, to August 3, 2022, was $ 1.4 million. |
Net Loss per Share Attributab_2
Net Loss per Share Attributable to Common Stockholders/Earnings (Loss) per Share (Tables) | 7 Months Ended | 12 Months Ended |
Aug. 03, 2022 | Jan. 31, 2024 | |
Earnings (Loss) per Share [Line Items] | ||
Summary of Basic and Diluted Calculations | The following table sets forth computation of basic loss per share attributable to common stockholders (in thousands, except share and per share data): Successor Predecessor Year Ended January 31, 2024 August 3, 2022 to February 1, 2022 to August 3, 2022 Numerator: Net loss $ ( 356,310 ) $ ( 720,647 ) $ ( 21,405 ) Net loss per share attributable to common $ ( 356,310 ) $ ( 720,647 ) $ ( 21,405 ) Denominator: Weighted-average common stock outstanding 123,813,143 116,862,277 43,041,209 Net loss per share attributable to common stockholders $ ( 2.88 ) $ ( 6.17 ) $ ( 0.50 ) | |
Summary of Anti-dilutive Securities Excluded from Computation of Diluted Net Loss per Common Share | The following potentially dilutive securities were not included in the calculation of weighted average common shares outstanding, as their effects would have been anti-dilutive for the year ended January 31, 2024, the Successor Period, and the Predecessor Period. Successor Predecessor Year ended January 31, 2024 August 4, 2022 to February 1, 2022 to Preferred stock (on an as-converted basis) Series Seed redeemable convertible preferred stock — — 18,396,744 Series A redeemable convertible preferred stock — — 31,994,570 Series B redeemable convertible preferred stock — — 53,829,898 Series C redeemable convertible preferred stock — — 42,249,398 Series C-1 redeemable convertible preferred stock — — 22,790,767 Series D redeemable convertible preferred stock — — 27,743,094 Series D-1 redeemable convertible preferred stock — — 11,756,606 Series D-2 redeemable convertible preferred stock — — 1,987,736 Series E redeemable convertible preferred stock — — 30,490,064 Total common stock reserved — — 241,238,877 Common stock Purchase consideration liability shares 1,354,411 — — Sponsor earn-out shares 1,293,750 1,293,750 — Total common stock 2,648,161 1,293,750 — Warrants Common stock warrants 16,314,256 16,220,756 1,924,790 Series A redeemable convertible preferred stock warrants — — 249,806 Series B redeemable convertible preferred stock warrants — — 292,682 Series C-1 redeemable convertible preferred stock warrants — — 1,247,369 Series E redeemable convertible preferred stock warrants — — 2,079,870 Total warrants 16,314,256 16,220,756 5,794,517 Options to purchase common stock Issued and outstanding 6,917,053 7,926,307 22,178,814 Restricted stock units Issued and outstanding 8,013,568 747,405 — | |
ID Experts Holdings, Inc. and Subsidiary [Member] | ||
Earnings (Loss) per Share [Line Items] | ||
Summary of Basic and Diluted Calculations | January 1, 2022, to August 3, 2022 Net income (loss) applicable to common equity $ ( 857 ) Less: undistributed earnings allocated to participating securities — Net income (loss) applicable to common stockholders $ ( 857 ) Total weighted-average common shares outstanding 12,854,967 Net income (loss) per share, basic and diluted $ ( 0.07 ) |
Organization and Description _2
Organization and Description of Business (Details) | Apr. 21, 2023 |
LGCS [Member] | |
Organization and Business Operations [Line Items] | |
Date of acquisition | Apr. 21, 2023 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies, Emerging Growth Company Status (Details) - ID Experts Holdings, Inc. and Subsidiary [Member] - Minimum [Member] | 12 Months Ended |
Jan. 31, 2024 USD ($) | |
Accounting Policies [Line Items] | |
Total annual gross revenue | $ 1,235,000,000 |
Market value of common stock held by non-affiliates | 700,000,000 |
Non-convertible debt securities issued | $ 1,000,000,000 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies, Summary of Receivables, Net of Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands | Jan. 31, 2024 | Jan. 31, 2023 | Aug. 03, 2022 |
Accounting Policies [Line Items] | |||
Unbilled receivables | $ 8,212 | $ 7,458 | |
ID Experts Holdings, Inc. and Subsidiary [Member] | |||
Accounting Policies [Line Items] | |||
Unbilled receivables | $ 7,800 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies, Summarizes Activity for Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands | 6 Months Ended | 7 Months Ended | 12 Months Ended | |||
Jan. 31, 2023 | Aug. 03, 2022 | Aug. 03, 2022 | Jan. 31, 2024 | Jan. 31, 2023 | Jan. 31, 2022 | |
Accounting Policies [Line Items] | ||||||
Beginning balance | $ 201 | $ 133 | $ 145 | $ 201 | ||
Additional charged to costs and expenses | $ 32 | $ (7) | 118 | |||
Charged to cost and expenses | 32 | $ 118 | ||||
Write-offs and recoveries | (20) | (62) | ||||
Ending balance | $ 145 | $ 201 | $ 145 | $ 201 | ||
ID Experts Holdings, Inc. and Subsidiary [Member] | ||||||
Accounting Policies [Line Items] | ||||||
Additional charged to costs and expenses | $ (117) |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies, Revenue Recognition (Details) - USD ($) | 1 Months Ended | 7 Months Ended | 12 Months Ended | |
Aug. 03, 2022 | Aug. 03, 2022 | Jan. 31, 2024 | Jan. 31, 2023 | |
Disaggregation of Revenue [Line Items] | ||||
Unbilled receivables | $ 8,212,000 | $ 7,458,000 | ||
ZeroFox Digital Risk Protection [Member] | Minimum [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Subscription Contracts Terms | 1 year | |||
ZeroFox Digital Risk Protection [Member] | Maximum [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Subscription Contracts Terms | 3 years | |||
Breach Services [Member] | Minimum [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Subscription Performance Periods | 1 year | |||
Breach Services [Member] | Maximum [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Subscription Performance Periods | 3 years | |||
ID Experts Holdings, Inc. and Subsidiary [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Unbilled receivables | $ 7,800,000 | $ 7,800,000 | ||
Revenue included in deferred revenue | 5,100,000 | |||
ID Experts Holdings, Inc. and Subsidiary [Member] | Breach Services [Member] | Minimum [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue services performance period | 1 year | |||
ID Experts Holdings, Inc. and Subsidiary [Member] | Breach Services [Member] | Maximum [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue services performance period | 3 years | |||
ID Experts Holdings, Inc. and Subsidiary [Member] | Membership Services [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue services performance period | 1 year | |||
Losses on uncompleted contracts | $ 0 | $ 0 |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies, Revenue Recognition (Details1) | Jan. 31, 2024 | Aug. 03, 2022 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-02-01 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 1 year | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-02-01 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 1 year | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-02-01 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | ||
ID Experts Holdings, Inc. and Subsidiary [Member] | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-08-04 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Percentage | 98% | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 12 months | |
ID Experts Holdings, Inc. and Subsidiary [Member] | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Percentage | 2% | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 12 months | |
ID Experts Holdings, Inc. and Subsidiary [Member] | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Percentage | 0% | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 24 months | |
ID Experts Holdings, Inc. and Subsidiary [Member] | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-01-01 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 24 months | |
ID Experts Holdings, Inc. and Subsidiary [Member] | Deferred Revenue [Member] | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-08-04 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Percentage | 56% | |
ID Experts Holdings, Inc. and Subsidiary [Member] | Deferred Revenue [Member] | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-11-01 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 5 months | |
ID Experts Holdings, Inc. and Subsidiary [Member] | Deferred Revenue [Member] | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Percentage | 29% | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 7 months |
Summary of Significant Accoun_9
Summary of Significant Accounting Policies, Revenue Earned by Timing of Revenue (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Jan. 31, 2023 | Aug. 03, 2022 | Jan. 31, 2024 | Jan. 31, 2022 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 88,386 | $ 29,237 | $ 233,300 | |
Over Time [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 79,025 | 185,345 | $ 27,946 | |
Point in Time [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 9,361 | $ 1,291 | $ 47,955 |
Summary of Significant Accou_10
Summary of Significant Accounting Policies, Timing of Revenue Recognition (Details) - ID Experts Holdings, Inc. and Subsidiary [Member] | 7 Months Ended |
Aug. 03, 2022 | |
Breach [Member] | Point in Time [Member] | |
Disaggregation of Revenue [Line Items] | |
Revenue from contract with customer, percentage | 12.60% |
Breach [Member] | Over Time [Member] | |
Disaggregation of Revenue [Line Items] | |
Revenue from contract with customer, percentage | 83.40% |
Membership Services [Member] | Over Time [Member] | |
Disaggregation of Revenue [Line Items] | |
Revenue from contract with customer, percentage | 4% |
Summary of Significant Accou_11
Summary of Significant Accounting Policies, Business Combinations (Details) | 6 Months Ended |
Jan. 31, 2023 | |
Business Combinations [Abstract] | |
Variable interest entity, ownership percentage | 100% |
Summary of Significant Accou_12
Summary of Significant Accounting Policies, Goodwill and Intangible Assets (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | ||||
Oct. 31, 2023 | Jan. 31, 2023 | Jan. 31, 2024 | Oct. 31, 2022 | Aug. 03, 2022 | Jan. 31, 2022 | |
Goodwill [Line Items] | ||||||
Carrying value of goodwill | $ 406,608 | $ 134,100 | $ 35,002 | $ 35,002 | ||
Goodwill impairment charge | $ 72,100 | 698,650 | 284,240 | |||
Haveli Merger Agreement [Member] | ||||||
Goodwill [Line Items] | ||||||
Fair value of goodwill | 348,100 | |||||
Goodwill impairment charge | 212,100 | |||||
Reporting Unit [Member] | ||||||
Goodwill [Line Items] | ||||||
Fair value of goodwill | 572,700 | 348,100 | $ 675,000 | |||
Carrying value of goodwill | $ 644,800 | $ 560,200 | $ 1,373,700 | |||
Goodwill impairment charge | $ 698,700 |
Summary of Significant Accou_13
Summary of Significant Accounting Policies, Summary of Changes in Fair Value of Warrants (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | |||
Jan. 31, 2023 | Jan. 31, 2023 | Aug. 03, 2022 | Jan. 31, 2024 | Jan. 31, 2024 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||
(Gain) loss due to change in fair value of warrants | $ (5,364) | $ 2,059 | $ 349 | ||
Level 3 [Member] | Public | |||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||
Beginning balance | $ 4,226 | 7,387 | 10,709 | 1,373 | $ 1,373 |
Issuance of warrants | 519 | ||||
Exercise of warrants | (5,900) | ||||
(Gain) loss due to change in fair value of warrants | (2,853) | 2,059 | (1,297) | ||
Ending balance | 1,373 | 1,373 | $ 7,387 | 76 | 76 |
Level 3 [Member] | Private | |||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||
Beginning balance | 11,351 | 1,208 | 1,208 | ||
Issuance of warrants | 126 | ||||
Exercise of warrants | (7,632) | ||||
(Gain) loss due to change in fair value of warrants | (2,511) | (1,190) | |||
Ending balance | $ 1,208 | $ 1,208 | $ 144 | $ 144 |
Summary of Significant Accou_14
Summary of Significant Accounting Policies, Concentration of Revenue and Accounts Receivable (Details) | 6 Months Ended | 12 Months Ended | ||
Jan. 31, 2023 | Aug. 03, 2022 | Jan. 31, 2024 | Jan. 31, 2023 | |
Non-US [Member] | Revenue from Rights Concentration Risk [Member] | Revenue Benchmark [Member] | ||||
Accounting Policies [Line Items] | ||||
Percentage of revenue | 10% | |||
One Customer [Member] | Revenue from Rights Concentration Risk [Member] | Revenue Benchmark [Member] | ||||
Accounting Policies [Line Items] | ||||
Percentage of revenue | 47% | 35% | 23% | |
One Customer [Member] | Customer Concentration Risk [Member] | Accounts Receivables [Member] | ||||
Accounting Policies [Line Items] | ||||
Percentage of revenue | 18% |
Summary of Significant Accou_15
Summary of Significant Accounting Policies, Summary of Accounts Receivable (Details) - USD ($) $ in Thousands | Jan. 31, 2024 | Jan. 31, 2023 | Jan. 31, 2022 | Dec. 31, 2021 | Feb. 01, 2021 |
Accounting Policies [Line Items] | |||||
Accounts receivable, billed | $ 30,912 | $ 22,296 | |||
Accounts receivable, unbilled | 8,212 | 7,458 | |||
Less: Allowance for doubtful accounts | (201) | (145) | $ (201) | $ (133) | $ (145) |
Accounts receivable, net | $ 38,923 | $ 29,609 |
Summary of Significant Accou_16
Summary of Significant Accounting Policies, Summary of Deferred Contract Acquisition Costs Activity (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Jan. 31, 2024 | Jan. 31, 2023 | Jan. 31, 2023 | Jan. 31, 2024 | |
Accounting Policies [Line Items] | ||||
Deferred Policy Acquisition Cost, Beginning Balance | $ 12,091 | |||
Deferred contract acquisition costs, current | $ 5,351 | $ 5,456 | 5,456 | $ 5,351 |
Deferred contract acquisition costs, net of current portion | 7,751 | |||
Capitalization of contract acquisition costs | 4,915 | |||
Amortization of deferred contract acquisition costs | (3,799) | |||
Deferred Policy Acquisition Cost, Ending Balance | $ 13,207 | $ 13,207 | ||
Zero Fox Predecessor [Member] | ||||
Accounting Policies [Line Items] | ||||
Deferred Policy Acquisition Cost, Beginning Balance | 13,207 | |||
Purchase accounting adjustment | (8,834) | |||
Deferred contract acquisition costs, current | 5,351 | 5,351 | ||
Deferred contract acquisition costs, net of current portion | 4,755 | |||
Capitalization of contract acquisition costs | 12,334 | |||
Amortization of deferred contract acquisition costs | (6,601) | |||
Deferred Policy Acquisition Cost, Ending Balance | $ 10,106 | $ 10,106 |
Summary of Significant Accou_17
Summary of Significant Accounting Policies, Summary of Deferred Contract Fulfilment Costs (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended |
Jan. 31, 2023 | Jan. 31, 2024 | |
Accounting Policies [Line Items] | ||
Deferred contract fulfilment costs | $ 0.9 | |
Amortization expense of capitalized contracts costs | 0.3 | $ 3.9 |
Prepaid Expenses And Other Current Assets [Member] | ||
Accounting Policies [Line Items] | ||
Deferred contract fulfilment costs | 0.8 | $ 1.9 |
Other Current Assets [Member] | ||
Accounting Policies [Line Items] | ||
Deferred contract fulfilment costs | $ 0.1 |
Summary of Significant Accou_18
Summary of Significant Accounting Policies, Capitalized Software Costs (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Jan. 31, 2023 | Aug. 03, 2022 | Jan. 31, 2024 | Jan. 31, 2023 | |
Accounting Policies [Abstract] | ||||
Capitalized software development costs | $ 300 | $ 200 | $ 500 | |
Amortization of software development costs | $ 25 | $ 321 | $ 129 | $ 300 |
Summary of Significant Accou_19
Summary of Significant Accounting Policies, Transaction Fees (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | |
Jan. 31, 2023 | Aug. 03, 2022 | Jan. 31, 2024 | |
Related Party Transaction [Line Items] | |||
Professional and other transaction fees | $ 1.6 | ||
Banking and advisory fees, business combination | 8.5 | ||
Haveli Merger Agreement | |||
Related Party Transaction [Line Items] | |||
Professional and other transaction fees | $ 0.9 | ||
General and Administrative Expenses | |||
Related Party Transaction [Line Items] | |||
Professional and other transaction fees | $ 1.2 | $ 3.2 |
Summary of Significant Accou_20
Summary of Significant Accounting Policies, Income Taxes (Details) | 6 Months Ended | 12 Months Ended | |
Jan. 31, 2023 | Aug. 03, 2022 | Jan. 31, 2024 | |
Accounting Policies [Line Items] | |||
Effective income tax rate | 0.21% | 3.35% | 0.63% |
Minimum [Member] | |||
Accounting Policies [Line Items] | |||
Effective income tax rate | 50% |
Summary of Significant Accou_21
Summary of Significant Accounting Policies - Schedule of Deferred Debt Issuance Costs (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | |
Aug. 03, 2022 | Jan. 31, 2024 | Jan. 31, 2023 | |
Debt Issuance Costs, Net [Abstract] | |||
Deferred debt issuance costs, beginning | $ 1,627 | $ 127 | $ 1,627 |
Direct costs paid | 118 | 201 | 31 |
Grant-date fair value of warrants issued | 518 | ||
Amortization of debt issuance costs | (378) | (117) | (24) |
Deferred debt issuance costs, ending | $ 1,885 | $ 211 | $ 127 |
Summary of Significant Accou_22
Summary of Significant Accounting Policies, Standards Issued and Adopted (Details) - USD ($) $ in Thousands | Jan. 31, 2024 | Jan. 31, 2023 |
Accounting Policies [Line Items] | ||
Operating lease right-of-use assets | $ 3,553 | $ 720 |
Operating lease liabilities | 3,749 | 833 |
Cumulative-effect adjustment to opening retained earnings | $ (1,110,987) | $ (754,677) |
Summary of Significant Accou_23
Summary of Significant Accounting Policies, Summary of Estimated Useful Lives for Property and Equipment (Details) | Jan. 31, 2024 |
Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 2 years |
Computer Hardware and Purchase Software [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 3 years |
Furniture and Fixtures [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 7 years |
Furniture and Fixtures [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 3 years |
Leasehold Improvements [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant, and Equipment, Useful Life, Term, Description [Extensible Enumeration] | us-gaap:UsefulLifeTermOfLeaseMember |
Summary of Significant Accou_24
Summary of Significant Accounting Policies, Summary of Future Amortization Expense for Software Development Costs Capitalized (Details) - USD ($) $ in Thousands | Jan. 31, 2024 | Jan. 31, 2023 |
Capitalized Software Costs [Line Items] | ||
2025 | $ 44,981 | |
2026 | 44,904 | |
2027 | 44,881 | |
Total amortization of intangible assets expense | 233,854 | $ 262,444 |
Software Development Costs [Member] | ||
Capitalized Software Costs [Line Items] | ||
2025 | 165 | |
2026 | 39 | |
2027 | 138 | |
Total amortization of intangible assets expense | $ 342 |
Summary of Significant Accou_25
Summary of Significant Accounting Policies, Debt Issuance Costs (Details) - USD ($) $ in Thousands | Jan. 31, 2024 | Jan. 31, 2023 | Aug. 04, 2022 | Aug. 03, 2022 | Jan. 31, 2022 |
Accounting Policies [Line Items] | |||||
Debt issuance cost | $ 211 | $ 127 | $ 120 | $ 1,885 | $ 1,627 |
Summary of Significant Accou_26
Summary of Significant Accounting Policies, Advertising (Details) - USD ($) $ in Millions | 6 Months Ended | 7 Months Ended | 12 Months Ended | |
Aug. 03, 2022 | Aug. 03, 2022 | Jan. 31, 2024 | Jan. 31, 2022 | |
Accounting Policies [Line Items] | ||||
Advertising costs | $ 0.4 | $ 1.3 | $ 0.5 | |
ID Experts Holdings, Inc. and Subsidiary [Member] | ||||
Accounting Policies [Line Items] | ||||
Advertising costs | $ 0.8 |
Summary of Significant Accou_27
Summary of Significant Accounting Policies, Stock-Based Compensation (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | |
Jan. 31, 2023 | Aug. 03, 2022 | Jan. 31, 2024 | |
Accounting Policies [Line Items] | |||
Stock-based compensation expense | $ 2,500 | $ 862 | $ 7,525 |
Summary of Significant Accou_28
Summary of Significant Accounting Policies, Concentrations of Credit Risk (Details) - ID Experts Holdings, Inc. and Subsidiary [Member] - USD ($) $ in Millions | 7 Months Ended | |
Aug. 03, 2022 | Jan. 31, 2024 | |
Accounting Policies [Line Items] | ||
Cash, FDIC Insured Amount | $ 16 | |
Customer Concentration Risk [Member] | Revenue [Member] | ||
Accounting Policies [Line Items] | ||
Percentage of revenue | 73% | |
Customer Concentration Risk [Member] | Accounts Receivables [Member] | ||
Accounting Policies [Line Items] | ||
Percentage of revenue | 64% |
Summary of Significant Accou_29
Summary of Significant Accounting Policies, Reclassifications (Details) - USD ($) $ in Thousands | Jan. 31, 2024 | Jan. 31, 2023 |
Accounting Policies [Abstract] | ||
Deferred taxes | $ 11,310 | $ 27,618 |
Revenue, Revenues Earned by Lin
Revenue, Revenues Earned by Line of Service (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | |
Jan. 31, 2023 | Aug. 03, 2022 | Jan. 31, 2024 | |
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 88,386 | $ 29,237 | $ 233,300 |
Subscription Revenue | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 31,679 | 27,946 | 89,308 |
Services Revenue | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 56,707 | 1,291 | 143,992 |
Services Revenue | Breach Services | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 54,791 | 138,782 | |
Services Revenue | Other Services | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 1,916 | $ 1,291 | $ 5,210 |
Revenue, Revenues Earned Based
Revenue, Revenues Earned Based on Geographic Locations (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | |
Jan. 31, 2023 | Aug. 03, 2022 | Jan. 31, 2024 | |
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 88,386 | $ 29,237 | $ 233,300 |
United States | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 80,674 | 21,916 | 214,423 |
Other | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 7,712 | $ 7,321 | $ 18,877 |
Revenue (Details)
Revenue (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | ||
Jan. 31, 2023 | Aug. 03, 2022 | Jan. 31, 2024 | Jan. 31, 2023 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue recognized that was included in the opening deferred revenue balance | $ 31.4 | $ 48.3 | ||
Remaining deferred revenue acquired in business acquisitions | 3.9 | $ 21.3 | ||
Remaining performance obligations | $ 154.5 | |||
Non-US | Revenue [Member] | Geographic Concentration Risk | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of revenue | 10% | 10% | 10% |
Revenue (Details1)
Revenue (Details1) $ in Millions | Jan. 31, 2024 USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligations | $ 154.5 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-02-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligations | $ 127.1 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-02-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligations | $ 20.8 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-02-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligations | $ 6.6 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period |
Revenue, Summary of Components
Revenue, Summary of Components of Contract Assets and Liabilities (Details) - USD ($) $ in Thousands | Jan. 31, 2024 | Jan. 31, 2023 |
Accounts Receivable, Net [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Assets: | $ 38,923 | $ 29,609 |
Deferred Contract Acquisition Costs, Current and Non-current [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Assets: | 10,106 | 13,207 |
Deferred Revenue Current and Non-current [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Liabilities: | $ 86,846 | $ 53,958 |
Revenue, Summary of Significant
Revenue, Summary of Significant Components of Changes in Contract Liabilities (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | |
Jan. 31, 2023 | Jan. 31, 2024 | Jan. 31, 2023 | |
Contract with Customer, Contract Asset, Contract Liability, and Receivable [Abstract] | |||
Revenue recognized that was included in the opening deferred revenue balance | $ 31.4 | $ 48.3 | |
Remaining deferred revenue acquired in business acquisition | $ 3.9 | $ 21.3 |
Revenue from Contracts with C_3
Revenue from Contracts with Customers, Summary of Breach Revenue From Contract with Customers (Details) - ID Experts Holdings Inc And Subsidiary Member $ in Thousands | 7 Months Ended |
Aug. 03, 2022 USD ($) | |
Disaggregation of Revenue [Line Items] | |
Total breach services | $ 64,078 |
Notification Services [Member] | |
Disaggregation of Revenue [Line Items] | |
Total breach services | 8,386 |
Call Center and Monitoring Services [Member] | |
Disaggregation of Revenue [Line Items] | |
Total breach services | $ 55,692 |
Revenue from Contracts with C_4
Revenue from Contracts with Customers (Details) - USD ($) $ in Thousands | 6 Months Ended | 7 Months Ended | 12 Months Ended | |
Jan. 31, 2023 | Aug. 03, 2022 | Aug. 03, 2022 | Jan. 31, 2024 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 88,386 | $ 29,237 | $ 233,300 | |
Amortization expense of capitalized contracts costs | $ 300 | $ 3,900 | ||
ID Experts Holdings, Inc. and Subsidiary [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 66,758 | |||
Amortization expense of capitalized contracts costs | 7,800 | |||
ID Experts Holdings, Inc. and Subsidiary [Member] | Membership Services [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 2,700 |
Revenue from Contracts with C_5
Revenue from Contracts with Customers 1 (Details) - USD ($) $ in Thousands | 6 Months Ended | 7 Months Ended | 12 Months Ended |
Jan. 31, 2023 | Aug. 03, 2022 | Jan. 31, 2024 | |
Disaggregation of Revenue [Line Items] | |||
Capitalized Contract Cost, Amortization | $ 300 | $ 3,900 | |
Remaining performance obligations | 154,500 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-02-01 | |||
Disaggregation of Revenue [Line Items] | |||
Remaining performance obligations | 127,100 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-02-01 | |||
Disaggregation of Revenue [Line Items] | |||
Remaining performance obligations | 20,800 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-02-01 | |||
Disaggregation of Revenue [Line Items] | |||
Remaining performance obligations | $ 6,600 | ||
ID Experts Holdings, Inc. and Subsidiary [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Capitalized Contract Cost, Amortization | $ 7,800 | ||
ID Experts Holdings, Inc. and Subsidiary [Member] | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-08-04 | |||
Disaggregation of Revenue [Line Items] | |||
Remaining performance obligations | 86,610 | ||
ID Experts Holdings, Inc. and Subsidiary [Member] | Deferred Revenue [Member] | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-08-04 | |||
Disaggregation of Revenue [Line Items] | |||
Remaining performance obligations | $ 86,600 |
Revenue from Contracts with C_6
Revenue from Contracts with Customers, Summary of Total Value of Remaining Performance Obligations (Details) - USD ($) $ in Thousands | Jan. 31, 2024 | Aug. 03, 2022 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Amount | $ 154,500 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-02-01 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Amount | $ 127,100 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 1 year | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-02-01 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Amount | $ 20,800 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 1 year | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-02-01 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Amount | $ 6,600 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | ||
ID Experts Holdings Inc And Subsidiary Member | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-08-04 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Amount | $ 86,610 | |
Revenue, Remaining Performance Obligation, Percentage | 98% | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 12 months | |
ID Experts Holdings Inc And Subsidiary Member | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Percentage | 2% | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 12 months | |
ID Experts Holdings Inc And Subsidiary Member | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Percentage | 0% | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 24 months | |
ID Experts Holdings Inc And Subsidiary Member | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-01-01 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 24 months | |
ID Experts Holdings Inc And Subsidiary Member | Breach [Member] | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-08-04 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Amount | $ 85,932 | |
Revenue, Remaining Performance Obligation, Percentage | 98% | |
ID Experts Holdings Inc And Subsidiary Member | Breach [Member] | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Percentage | 2% | |
ID Experts Holdings Inc And Subsidiary Member | Breach [Member] | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Percentage | 0% | |
ID Experts Holdings Inc And Subsidiary Member | Membership Services [Member] | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-08-04 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Amount | $ 678 | |
Revenue, Remaining Performance Obligation, Percentage | 100% | |
ID Experts Holdings Inc And Subsidiary Member | Membership Services [Member] | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Percentage | 0% | |
ID Experts Holdings Inc And Subsidiary Member | Membership Services [Member] | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Percentage | 0% |
Property and Equipment, Net, Su
Property and Equipment, Net, Summary of Property and Equipment, Net (Details) - USD ($) $ in Thousands | Jan. 31, 2024 | Jan. 31, 2023 |
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $ 2,705 | $ 1,041 |
Less accumulated depreciation and amortization | (1,507) | (370) |
Total property and equipment, net | 1,198 | 671 |
Computer Hardware and Purchase Software [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 2,495 | 907 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 8 | 20 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $ 202 | $ 114 |
Property and Equipment, Net (De
Property and Equipment, Net (Details) - USD ($) $ in Thousands | 6 Months Ended | 7 Months Ended | 12 Months Ended | |
Jan. 31, 2023 | Aug. 03, 2022 | Aug. 03, 2022 | Jan. 31, 2024 | |
Property, Plant and Equipment [Line Items] | ||||
Depreciation and amortization | $ 366 | $ 322 | $ 1,703 | |
ID Experts Holdings Inc And Subsidiary Member | ||||
Property, Plant and Equipment [Line Items] | ||||
Depreciation and amortization | $ 46 |
Property and Equipment, Net, _2
Property and Equipment, Net, Summary of Property and Equipment, Net by Geographic Location (Details) - USD ($) $ in Thousands | Jan. 31, 2024 | Jan. 31, 2023 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, net | $ 1,198 | $ 671 |
Fair Value Measurements, Summar
Fair Value Measurements, Summary of Assets (Liabilities) Carried at Fair Value (Details) - USD ($) $ in Thousands | Jan. 31, 2024 | Jan. 31, 2023 |
Liabilities: | ||
Sponsor earnout shares | $ 392 | $ 2,445 |
Public Warrants [Member] | ||
Liabilities: | ||
Warrant liabilities | 100 | 1,400 |
Private Warrants [Member] | ||
Liabilities: | ||
Warrant liabilities | 100 | 1,200 |
Recurring [Member] | ||
Assets: | ||
Total financial assets | 557 | |
Liabilities: | ||
Sponsor earnout shares | (392) | (2,445) |
Purchase consideration liability | (4,362) | |
Total financial liabilities | (4,974) | (5,026) |
Recurring [Member] | Public Warrants [Member] | ||
Liabilities: | ||
Warrant liabilities | (76) | (1,373) |
Recurring [Member] | Private Warrants [Member] | ||
Liabilities: | ||
Warrant liabilities | (144) | (1,208) |
Recurring [Member] | Money Market Funds [Member] | ||
Assets: | ||
Cash equivalents | 557 | |
Recurring [Member] | Level 1 [Member] | ||
Assets: | ||
Total financial assets | 557 | |
Liabilities: | ||
Sponsor earnout shares | 0 | 0 |
Purchase consideration liability | (3,499) | |
Total financial liabilities | (3,575) | (1,373) |
Recurring [Member] | Level 1 [Member] | Public Warrants [Member] | ||
Liabilities: | ||
Warrant liabilities | (76) | (1,373) |
Recurring [Member] | Level 1 [Member] | Private Warrants [Member] | ||
Liabilities: | ||
Warrant liabilities | 0 | 0 |
Recurring [Member] | Level 1 [Member] | Money Market Funds [Member] | ||
Assets: | ||
Cash equivalents | 557 | |
Recurring [Member] | Level 2 [Member] | ||
Assets: | ||
Total financial assets | 0 | |
Liabilities: | ||
Sponsor earnout shares | 0 | 0 |
Purchase consideration liability | 0 | |
Total financial liabilities | (67) | (1,208) |
Recurring [Member] | Level 2 [Member] | Public Warrants [Member] | ||
Liabilities: | ||
Warrant liabilities | 0 | 0 |
Recurring [Member] | Level 2 [Member] | Private Warrants [Member] | ||
Liabilities: | ||
Warrant liabilities | (67) | (1,208) |
Recurring [Member] | Level 2 [Member] | Money Market Funds [Member] | ||
Assets: | ||
Cash equivalents | 0 | |
Recurring [Member] | Level 3 [Member] | ||
Assets: | ||
Total financial assets | 0 | |
Liabilities: | ||
Sponsor earnout shares | (392) | (2,445) |
Purchase consideration liability | (863) | |
Total financial liabilities | (1,332) | (2,445) |
Recurring [Member] | Level 3 [Member] | Public Warrants [Member] | ||
Liabilities: | ||
Warrant liabilities | 0 | 0 |
Recurring [Member] | Level 3 [Member] | Private Warrants [Member] | ||
Liabilities: | ||
Warrant liabilities | $ (77) | 0 |
Recurring [Member] | Level 3 [Member] | Money Market Funds [Member] | ||
Assets: | ||
Cash equivalents | $ 0 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) $ in Millions | Jan. 31, 2024 USD ($) |
Lookingglass Cyber Solutions, Inc. [Member] | |
Derivatives, Fair Value [Line Items] | |
Purchase consideration liability | $ 4.4 |
Acquisitions (Details)
Acquisitions (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Apr. 21, 2023 | Aug. 03, 2022 | Jul. 31, 2023 | Jan. 31, 2023 | Aug. 03, 2022 | Jan. 31, 2024 | Jan. 31, 2022 | |
Business Acquisition [Line Items] | |||||||
Common stock, shares issued (in shares) | 118,190,135 | 124,639,135 | |||||
Net proceeds from completion of convertible debt | $ 149,872,000 | ||||||
Net cash proceeds | $ 7,412,000 | $ 7,425,000 | |||||
Payments for common stock | 24,626,000 | ||||||
Business acquisition, transaction related expenses | 8,500,000 | ||||||
Payment of deferred underwriting fee | 6,054,000 | ||||||
Goodwill | $ 35,002,000 | 406,608,000 | 35,002,000 | 134,100,000 | $ 35,002,000 | ||
Revenue | 88,386,000 | 29,237,000 | 233,300,000 | ||||
Subscriptions [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Revenue | 31,679,000 | 27,946,000 | 89,308,000 | ||||
Service [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Revenue | $ 56,707,000 | $ 1,291,000 | $ 143,992,000 | ||||
IDX [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Increase (decrease) to goodwill | $ 200,000 | ||||||
Decrease to goodwill | (800,000) | ||||||
Reduced income tax payable | 1,300,000 | ||||||
Additional reserve for income tax positions | 500,000 | ||||||
Common stock, shares issued (in shares) | 27,849,942 | 27,849,942 | |||||
Aggregate cash consideration paid | $ 44,447,000 | ||||||
Business acquisition, transaction related expenses | 1,500,000 | $ 1,500,000 | |||||
Goodwill | $ 285,970,000 | $ 285,970,000 | |||||
Zero Fox [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Effective date of acquisition | Aug. 03, 2022 | ||||||
Date of agreement | Dec. 17, 2021 | ||||||
Increase (decrease) to goodwill | $ 7,500,000 | ||||||
Common stock, shares issued (in shares) | 82,030,308 | 82,030,308 | |||||
Business acquisition, transaction related expenses | $ 8,500,000 | $ 8,500,000 | |||||
Goodwill | $ 828,091,000 | $ 828,091,000 | |||||
Lookingglass Cyber Solutions, Inc. [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Effective date of acquisition | Apr. 21, 2023 | ||||||
Number of shares purchased by issuing warrants | 8,629,000 | ||||||
Business combination, Options to purchase common shares | 9,637,000 | ||||||
Aggregate cash consideration paid | $ 9,500,000 | ||||||
Goodwill | 4,832,000 | ||||||
Amount of goodwill recognized is expected to be deductible for income tax purposes | $ 0 |
Acquisitions - Summary of Estim
Acquisitions - Summary of Estimated Fair value of Purchase Consideration Paid (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Apr. 21, 2023 | Aug. 03, 2022 | Jan. 31, 2024 | Jan. 31, 2023 | |
Business Acquisition [Line Items] | ||||
Common Stock, Shares, Issued | 124,639,135 | 118,190,135 | ||
Adjusted closing price per share of the Company's Common Stock (ZFOX) | $ 0.88 | |||
Business acquisition, transaction related expenses | $ 8,500 | |||
Total purchase consideration shares | 3,810,108 | |||
Fair value of purchase consideration liability | $ 4,362 | |||
Zero Fox [Member] | ||||
Business Acquisition [Line Items] | ||||
Common Stock, Shares, Issued | 82,030,308 | |||
Adjusted closing price per share of the Company's Common Stock (ZFOX) | $ 10.95 | |||
Fair value of Common Stock issued | $ 898,232 | |||
Repayment of debt and interest | 37,674 | |||
Business acquisition, transaction related expenses | 8,500 | |||
Total consideration paid | 949,406 | |||
Zero Fox [Member] | PIPE Investors [Member] | ||||
Business Acquisition [Line Items] | ||||
Repayment of debt and interest | $ 5,000 | |||
IDX [Member] | ||||
Business Acquisition [Line Items] | ||||
Common Stock, Shares, Issued | 27,849,942 | |||
Adjusted closing price per share of the Company's Common Stock (ZFOX) | $ 10.95 | |||
Fair value of Common Stock issued | $ 304,957 | |||
Cash consideration paid to IDX shareholders | 44,447 | |||
Repayment of debt and interest | 12,484 | |||
Business acquisition, transaction related expenses | 1,500 | |||
Cash consideration | 44,447 | |||
Total consideration paid | 368,388 | |||
IDX [Member] | PIPE Investors [Member] | ||||
Business Acquisition [Line Items] | ||||
Cash consideration gross up for offset of PIPE subscribers also IDX holders | $ 5,000 | |||
LGCS [Member] | ||||
Business Acquisition [Line Items] | ||||
Adjusted closing price per share of the Company's Common Stock (ZFOX) | $ 1.1 | |||
Cash consideration paid to IDX shareholders | $ 9,500 | |||
Total purchase consideration shares | 8,628,956 | |||
Fair value of purchase consideration liability | $ 9,465 | |||
Cash consideration | 9,500 | |||
Convertible note | 3,333 | |||
Total consideration paid | $ 22,298 | |||
LGCS [Member] | LGCS Earnout Shares [Member] | ||||
Business Acquisition [Line Items] | ||||
Total purchase consideration shares | 1,837,500 | |||
LGCS [Member] | LGCS Deferred Shares [Member] | ||||
Business Acquisition [Line Items] | ||||
Total purchase consideration shares | 6,791,456 |
Acquisitions - Summary of Preli
Acquisitions - Summary of Preliminary Allocation of Purchase Price (Details) - USD ($) $ in Thousands | Jan. 31, 2024 | Apr. 21, 2023 | Jan. 31, 2023 | Aug. 03, 2022 | Jan. 31, 2022 |
Business Acquisition [Line Items] | |||||
Goodwill | $ 134,100 | $ 406,608 | $ 35,002 | $ 35,002 | |
Zero Fox [Member] | |||||
Business Acquisition [Line Items] | |||||
Cash and cash equivalents | 2,806 | ||||
Accounts receivable | 13,961 | ||||
Prepaid expenses and other assets | 2,201 | ||||
Property and equipment, net | 598 | ||||
Other assets | 341 | ||||
Goodwill | 828,091 | ||||
Intangible assets | 185,000 | ||||
Total assets acquired | 1,032,998 | ||||
Accounts payable | 4,310 | ||||
Accrued liabilities | 3,921 | ||||
Current portion of long term debt | 938 | ||||
Deferred revenue, current | 35,432 | ||||
Deferred revenue, net of current portion | 6,325 | ||||
Long term debt | 16,851 | ||||
Warrants liabilities | 7,632 | ||||
Deferred tax liability | 8,183 | ||||
Total liabilities assumed | 83,592 | ||||
Total consideration transferred | 949,406 | ||||
IDX [Member] | |||||
Business Acquisition [Line Items] | |||||
Cash and cash equivalents | 13,727 | ||||
Accounts receivable | 11,944 | ||||
Prepaid expenses and other assets | 2,939 | ||||
Property and equipment, net | 125 | ||||
Goodwill | 285,970 | ||||
Intangible assets | 100,500 | ||||
Total assets acquired | 415,205 | ||||
Accounts payable | 7,568 | ||||
Accrued liabilities | 4,944 | ||||
Deferred revenue, current | 9,314 | ||||
Deferred revenue, net of current portion | 1,522 | ||||
Deferred tax liability | 23,469 | ||||
Total liabilities assumed | 46,817 | ||||
Total consideration transferred | $ 368,388 | ||||
LGCS [Member] | |||||
Business Acquisition [Line Items] | |||||
Cash and cash equivalents | $ 1,608 | ||||
Accounts receivable | 3,233 | ||||
Prepaid expenses and other assets | 1,562 | ||||
Property and equipment, net | 1,627 | ||||
Operating lease right-of-use assets | 656 | ||||
Goodwill | 4,832 | ||||
Intangible assets | 17,900 | ||||
Deferred tax assets | 6,515 | ||||
Total assets acquired | 37,933 | ||||
Accounts payable | 1,304 | ||||
Accrued compensation, accrued expenses, and other current liabilities | 2,279 | ||||
Operating lease liabilities, current | 584 | ||||
Deferred revenue, current | 10,850 | ||||
Other liabilities | 524 | ||||
Operating lease liabilities, net of current portion | 94 | ||||
Total liabilities assumed | 15,635 | ||||
Total consideration transferred | $ 22,298 |
Acquisitions, Summary of Intang
Acquisitions, Summary of Intangible Assets Identified, Estimated Useful Lives and Methodologies Used to Determine Fair Values (Details) - LGCS [Member] $ in Thousands | Apr. 21, 2023 USD ($) |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Fair Value | $ 17,900 |
Customer Relationships [Member] | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Fair Value | $ 13,700 |
Useful Life (in years) | 10 years |
Fair Value Methodology | Multi-period Excess Earnings method of the Income Approach |
Internally Developed Technology[ Member] | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Fair Value | $ 4,000 |
Useful Life (in years) | 7 years |
Fair Value Methodology | Relief from Royalty method |
Trade Names and Trademarks [Member] | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Fair Value | $ 200 |
Useful Life (in years) | 2 years |
Fair Value Methodology | Relief from Royalty method |
Goodwill and Intangible Assets,
Goodwill and Intangible Assets, Summary of Changes in Fair Value of Goodwill (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | |
Oct. 31, 2023 | Jan. 31, 2023 | Jan. 31, 2024 | |
Goodwill [Roll Forward] | |||
Goodwill (gross) | $ 1,105,258 | ||
Accumulated impairment loss | (698,650) | ||
Goodwill, beginning balance | $ 35,002 | 406,608 | |
Business acquisition | 4,832 | ||
Adjustment to purchase accounting from the Business Combination | 6,900 | ||
Impairment | $ (72,100) | (698,650) | (284,240) |
Goodwill, ending balance | $ 406,608 | $ 134,100 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets (Details) - USD ($) | 6 Months Ended | 12 Months Ended | ||||
Oct. 31, 2023 | Jan. 31, 2023 | Jan. 31, 2024 | Oct. 31, 2022 | Aug. 03, 2022 | Jan. 31, 2022 | |
Goodwill [Line Items] | ||||||
Goodwill impairment charge | $ 72,100,000 | $ 698,650,000 | $ 284,240,000 | |||
Carrying value of goodwill | 406,608,000 | 134,100,000 | $ 35,002,000 | $ 35,002,000 | ||
Impairment of long-lived assets | 0 | |||||
Haveli Merger Agreement [Member] | ||||||
Goodwill [Line Items] | ||||||
Goodwill impairment charge | 212,100,000 | |||||
Fair value of goodwill | 348,100,000 | |||||
Reporting Unit [Member] | ||||||
Goodwill [Line Items] | ||||||
Goodwill impairment charge | $ 698,700,000 | |||||
Fair value of goodwill | 572,700,000 | 348,100,000 | $ 675,000,000 | |||
Carrying value of goodwill | $ 644,800,000 | $ 560,200,000 | $ 1,373,700,000 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets, Summary of Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 31, 2024 | Jan. 31, 2023 | |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 303,400 | $ 285,500 |
Accumulated Amortization | (69,546) | (23,056) |
Net Carrying Amount | $ 233,854 | $ 262,444 |
Customer Relationships [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Useful Life (in years) | 7 years 9 months 18 days | 8 years 7 months 6 days |
Gross Carrying Amount | $ 168,100 | $ 154,400 |
Accumulated Amortization | (35,174) | (11,894) |
Net Carrying Amount | $ 132,926 | $ 142,506 |
Developed Technology [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Useful Life (in years) | 5 years 1 month 6 days | 5 years |
Gross Carrying Amount | $ 99,800 | $ 95,800 |
Accumulated Amortization | (29,028) | (9,425) |
Net Carrying Amount | $ 70,772 | $ 86,375 |
Trademarks and Trade Names [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Weighted Average Useful Life (in years) | 10 years | 10 years |
Gross Carrying Amount | $ 35,500 | $ 35,300 |
Accumulated Amortization | (5,344) | (1,737) |
Net Carrying Amount | $ 30,156 | $ 33,563 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets, Summary of Future Amortization of Intangible Assets (Details) - USD ($) $ in Thousands | Jan. 31, 2024 | Jan. 31, 2023 |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Fiscal 2025 | $ 44,981 | |
Fiscal 2026 | 44,904 | |
Fiscal 2027 | 44,881 | |
Fiscal 2028 | 35,456 | |
Fiscal 2029 | 20,515 | |
Thereafter | 43,117 | |
Total amortization of intangible assets expense | $ 233,854 | $ 262,444 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets, Summary of Recognized Amortization of Intangible Assets Expense Recognized in Condensed Consolidated Statements of Comprehensive Loss (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | |
Jan. 31, 2023 | Aug. 03, 2022 | Jan. 31, 2024 | |
Finite-Lived Intangible Assets [Line Items] | |||
Total amortization of acquired intangible assets | $ 23,056 | $ 1,604 | $ 46,490 |
Cost of Revenue [Member] | Subscriptions [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Total amortization of acquired intangible assets | 9,425 | 260 | 19,603 |
Sales and Marketing [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Total amortization of acquired intangible assets | 11,894 | 1,308 | 23,280 |
General and Administrative [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Total amortization of acquired intangible assets | $ 1,737 | $ 36 | $ 3,607 |
Leases (Details)
Leases (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | |
Jan. 31, 2023 | Aug. 03, 2022 | Jan. 31, 2024 | |
Lessee, Lease, Description [Line Items] | |||
Total net cost for operating leases | $ 1.6 | $ 1.6 | $ 2.6 |
Operating leases cash payments | $ 1.6 | $ 1.6 | |
Minimum [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Operating leases remaining terms | 1 year | ||
Maximum [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Operating leases remaining terms | 3 years |
Leases, Summary of Supplemental
Leases, Summary of Supplemental Balance Sheet Information Related to Lease Liabilities (Details) - USD ($) $ in Thousands | Jan. 31, 2024 | Jan. 31, 2023 |
Leases [Abstract] | ||
Operating ROU assets | $ 3,553 | $ 720 |
Operating lease liabilities, current | 1,638 | 406 |
Operating lease liabilities, net of current portion | 2,111 | 427 |
Total operating lease liabilities | $ 3,749 | $ 833 |
Weighted average remaining lease term | 2 years 4 months 24 days | 1 year 8 months 12 days |
Weighted average discount rate | 7.10% | 4.80% |
Leases, Summary of Maturities o
Leases, Summary of Maturities of Operating Lease Liabilities (Details) - USD ($) $ in Thousands | Jan. 31, 2024 | Jan. 31, 2023 |
Lessee, Lease, Description [Line Items] | ||
2025 | $ 1,863 | |
2026 | 1,409 | |
2027 | 760 | |
2028 | 82 | |
Total minimum lease payments | 4,114 | |
Less: imputed interest | (365) | |
Total lease payments | $ 3,749 | $ 833 |
Debt, Summary of Debt Outstandi
Debt, Summary of Debt Outstanding (Details) - USD ($) $ in Thousands | Jan. 31, 2024 | Jan. 31, 2023 | Aug. 03, 2022 |
Debt Instrument [Line Items] | |||
Stated Interest Rate | 6% | ||
Gross Balance | $ 197,977 | $ 173,908 | |
Unamortized Debt Discount | 83 | ||
Unamortized Deferred Debt Issuance Costs | 129 | (127) | |
Total long-term debt | 197,765 | 173,781 | |
Current portion of long-term debt | 938 | 15,938 | |
Long-term debt | $ 196,827 | $ 157,843 | |
PIK [Member] | |||
Debt Instrument [Line Items] | |||
Stated Interest Rate | 8.75% | ||
Stifel Bank [Member] | |||
Debt Instrument [Line Items] | |||
Stated Interest Rate | 9.50% | 8.50% | |
Effective Interest Rate | 9.86% | 8.50% | |
Gross Balance | $ 22,500 | $ 15,000 | |
Unamortized Debt Discount | 83 | ||
Unamortized Deferred Debt Issuance Costs | 52 | ||
Total long-term debt | $ 22,365 | $ 15,000 | |
InfoArmor [Member] | |||
Debt Instrument [Line Items] | |||
Stated Interest Rate | 5.50% | 5.50% | |
Effective Interest Rate | 5.50% | 5.50% | |
Gross Balance | $ 1,406 | $ 2,344 | |
Total long-term debt | $ 1,406 | $ 2,344 | |
Convertible Notes [Member] | |||
Debt Instrument [Line Items] | |||
Stated Interest Rate | 7% | 7% | |
Effective Interest Rate | 9.78% | 8.53% | |
Gross Balance | $ 170,738 | $ 156,564 | |
Unamortized Deferred Debt Issuance Costs | 77 | (127) | |
Total long-term debt | $ 170,661 | $ 156,437 | |
Convertible Notes [Member] | PIK [Member] | |||
Debt Instrument [Line Items] | |||
Stated Interest Rate | 8.75% | 8.75% | |
Alsop Louie Convertible Note [Member] | |||
Debt Instrument [Line Items] | |||
Stated Interest Rate | 6% | ||
Effective Interest Rate | 3.36% | ||
Gross Balance | $ 3,333 | ||
Total long-term debt | $ 3,333 |
Debt, Summary of Debt Outstan_2
Debt, Summary of Debt Outstanding (Parenthetical) (Details) | Jan. 31, 2024 |
Debt Disclosure [Abstract] | |
Stated Interest Rate | 6% |
Debt (Details)
Debt (Details) - USD ($) | 6 Months Ended | 12 Months Ended | |||||||||
Apr. 21, 2023 | Aug. 03, 2022 | Jun. 07, 2021 | Jan. 07, 2021 | Aug. 03, 2022 | Jan. 31, 2024 | Jan. 31, 2023 | Aug. 04, 2022 | Jan. 31, 2022 | Dec. 31, 2021 | Dec. 08, 2021 | |
Debt Instrument [Line Items] | |||||||||||
Net cash proceeds | $ 7,412,000 | $ 7,425,000 | |||||||||
Debt issuance cost | $ 1,885,000 | $ 1,885,000 | $ 211,000 | $ 127,000 | $ 120,000 | $ 1,627,000 | |||||
Debt instrument, percentage | 6% | ||||||||||
Ordinary shares, shares issued (in shares) | 124,639,135 | 118,190,135 | |||||||||
Accrued and unpaid interest percentage | 100% | ||||||||||
Increase in default rate of interest | 1.50% | ||||||||||
Current portion of long-term debt | $ 938,000 | $ 15,938,000 | |||||||||
Zero Fox [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Repayment of debt | 37,674,000 | ||||||||||
Purchase price | $ 949,406,000 | ||||||||||
Ordinary shares, shares issued (in shares) | 82,030,308 | 82,030,308 | |||||||||
Lookingglass Cyber Solutions, Inc. [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Purchase price | $ 22,298,000 | ||||||||||
Convertible Senior Cash [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Investors agreed purchase value in aggregate principal amount | $ 150,000,000 | $ 150,000,000 | |||||||||
Debt instrument, percentage | 7% | 7% | |||||||||
Convertible Notes Maturity Date | Aug. 03, 2025 | ||||||||||
Ordinary shares, shares issued (in shares) | 86.9565 | 86.9565 | |||||||||
Outstanding principal and accrued interest | $ 1,000 | ||||||||||
Accrued and unpaid interest percentage | 100% | 100% | |||||||||
Convertible notes financing | $ 150,000,000 | $ 150,000,000 | |||||||||
Debt Instrument, Convertible, Conversion Price | $ 11.5 | $ 11.5 | |||||||||
Increase in default rate of interest | 2% | ||||||||||
Payment in Kind (PIK) Note [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt instrument, percentage | 8.75% | 8.75% | |||||||||
First Year [Member] | Convertible Senior Cash [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Percentage of stock price trigger | 150% | ||||||||||
Number of threshold trading days | 20 days | ||||||||||
Number of consecutive threshold consecutive trading days | 30 days | ||||||||||
Second Year [Member] | Convertible Senior Cash [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Percentage of stock price trigger | 130% | ||||||||||
Number of threshold trading days | 20 days | ||||||||||
Number of consecutive threshold consecutive trading days | 30 days | ||||||||||
Convertible Notes [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt instrument, percentage | 7% | 7% | |||||||||
Debt instrument interest option | 9.78% | 8.53% | |||||||||
Convertible Notes [Member] | Payment in Kind (PIK) Note [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt instrument, percentage | 8.75% | 8.75% | |||||||||
PIPE Investors [Member] | Bridge Notes [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Principle value of related notes | $ 5,000,000 | ||||||||||
Stifel Note [Member] | Amended Loan and Security Agreement [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Cumulative outstanding principal of loan | $ 15,000,000 | ||||||||||
Stifel Note [Member] | Amended Loan and Security Agreement [Member] | Lookingglass Cyber Solutions, Inc. [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Borrowing amount | 7,500,000 | ||||||||||
Loan maturity date | Jun. 30, 2025 | ||||||||||
Aggregate borrowing limit | $ 22,500,000 | ||||||||||
Warrants issued | 128,676 | ||||||||||
Exercise price of the warrant | $ 1.36 | ||||||||||
Cumulative outstanding principal of loan | $ 22,500,000 | ||||||||||
Stifel Note [Member] | Loan and Security Agreement [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Borrowing amount | $ 10,000,000 | $ 5,000,000 | $ 5,000,000 | ||||||||
Loan maturity date | Jan. 07, 2024 | ||||||||||
Repayment of debt | $ 10,000,000 | ||||||||||
Percentage of Late Fee Changed on Unpaid Amount | 5% | ||||||||||
Debt instrument, percentage | 4.50% | ||||||||||
Increase in default rate of interest | 4% | ||||||||||
Stifel Note [Member] | Loan and Security Agreement [Member] | Prime Rate [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt instrument, percentage | 1% | ||||||||||
InfoArmor Note [Member] | Loan and Security Agreement [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Loan maturity date | Jun. 07, 2025 | ||||||||||
InfoArmor Note [Member] | Promissory Note Payable [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Repayment of debt | $ 200,000 | ||||||||||
Debt instrument, percentage | 5.50% | ||||||||||
InfoArmor Note [Member] | Promissory Note Payable [Member] | Current Portion of Long-term Debt [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Repayment of debt | $ 900,000 | ||||||||||
InfoArmor Note [Member] | Promissory Note Payable [Member] | Vigilante [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Borrowing amount | $ 3,800,000 | ||||||||||
Alsop Louie Convertible Note [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt instrument, percentage | 6% | ||||||||||
Debt instrument interest option | 3.36% | ||||||||||
Alsop Louie Convertible Note [Member] | Subordinated Convertible Promissory Note [Member] | Lookingglass Cyber Solutions, Inc. [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Borrowing amount | $ 3,300,000 | ||||||||||
Loan maturity date | Jul. 31, 2025 | ||||||||||
Debt instrument, percentage | 6% | ||||||||||
Share price | $ 5 | ||||||||||
Series E Redeemable Convertible Preferred Stock [Member] | Stifel Note [Member] | Amended Loan and Security Agreement [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Warrants issued | 161,113 | ||||||||||
Exercise price of the warrant | $ 1.86205 |
Accrued Compensation, Accrued_3
Accrued Compensation, Accrued Expenses, and Other Current Liabilities, Summary of Accrued Compensation, Accrued Expenses, and Other Current Liabilities (Details) - USD ($) $ in Thousands | Jan. 31, 2024 | Jan. 31, 2023 |
Accrued Liabilities, Current [Abstract] | ||
Other current liabilities | $ 10,521 | $ 12,110 |
Accrued bonuses | 3,374 | 3,893 |
Accrued commissions | 1,988 | 1,408 |
Accrued employee compensation | 1,243 | 1,340 |
Total accrued expense | $ 17,126 | $ 18,751 |
Convertible Debt Loan, Addition
Convertible Debt Loan, Additional Information (Details) $ in Thousands | 7 Months Ended |
Aug. 03, 2022 USD ($) | |
ID Experts Holdings, Inc. and Subsidiary [Member] | |
Convertible Debt Loans [Line Items] | |
Change in fair value of debt | $ 589 |
Other Liabilities, Summary of O
Other Liabilities, Summary of Other Liabilities (Details) - USD ($) $ in Thousands | Jan. 31, 2024 | Jan. 31, 2023 |
Other Liabilities [Abstract] | ||
Purchase consideration liability | $ 4,362 | |
Deferred tax liability | 4,219 | $ 21,638 |
Other | 2,117 | 954 |
Sponsor earnout shares | 392 | 2,445 |
Warrants | $ 220 | $ 2,581 |
Derivative Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Total other liabilities | Total other liabilities |
Total other liabilities | $ 11,310 | $ 27,618 |
Other Liabilities, Warrants (De
Other Liabilities, Warrants (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Jan. 31, 2024 | Apr. 21, 2023 | Jan. 31, 2023 | |
Warrants [Abstract] | |||
Period warrants to become exercisable after completion of business combination | 30 days | ||
Redemption of Warrants When Price Exceeds $18.00 [Member] | |||
Warrants [Abstract] | |||
Warrant redemption price (in dollars per share) | $ 0.01 | ||
Notice period to redeem warrants | 30 days | ||
Number of trading days | 20 days | ||
Trading day threshold period | 30 days | ||
Redemption of Warrants When Price Exceeds $18.00 [Member] | Minimum [Member] | |||
Warrants [Abstract] | |||
Share price | $ 18 | ||
Redemption of Warrants When Price Exceeds $10.00 [Member] | |||
Warrants [Abstract] | |||
Warrant redemption price (in dollars per share) | $ 0.1 | ||
Notice period to redeem warrants | 30 days | ||
Number of trading days | 20 days | ||
Trading day threshold period | 30 days | ||
Redemption of Warrants When Price Exceeds $10.00 [Member] | Minimum [Member] | |||
Warrants [Abstract] | |||
Share price | $ 10 | ||
Public Warrants [Member] | |||
Warrants [Abstract] | |||
Number of warrants outstanding (in shares) | 8,625,000 | ||
Warrants expiration period | 5 years | ||
Warrants exercise price (in dollars per share) | $ 0.0088 | $ 0.16 | |
Fair value of warrants | $ 0.1 | $ 1.4 | |
Private Warrants [Member] | |||
Warrants [Abstract] | |||
Number of warrants outstanding (in shares) | 7,588,430 | ||
Fair value of warrants | $ 0.1 | $ 1.2 | |
Public and Private Warrants Member | |||
Warrants [Abstract] | |||
Warrants exercise price (in dollars per share) | $ 11.5 | ||
Stifel Warrant [Member] | Amended Loan and Security Agreement [Member] | |||
Warrants [Abstract] | |||
Warrants exercise price (in dollars per share) | $ 1.36 | ||
Warrants issued | 128,676 |
Other Liabilities, Summary of A
Other Liabilities, Summary of Assumptions Used in Estimating Fair Values of Warrants (Details) - Stifel Warrant [Member] - Black-Scholes [Member] - $ / shares | 12 Months Ended | |
Apr. 21, 2023 | Jan. 31, 2024 | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Asset price | $ 1.32 | $ 0.88 |
Exercise price of the warrant | $ 1.36 | $ 1.36 |
Contractual term | 10 years | 9 years 2 months 12 days |
Volatility | 65% | 67.50% |
Dividend yield | 0% | 0% |
Risk-free rate | 3.60% | 4% |
Other Liabilities, Sponsor Earn
Other Liabilities, Sponsor Earnout Shares (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | |
Aug. 03, 2022 | Jan. 31, 2024 | |
Sponsor Earnout Shares [Line Items] | ||
Common stock shares subject to potential forfeiture | 1,293,750 | |
Earnout period | Aug. 03, 2022 | |
Sponsor Earnout Shares [Member] | ||
Sponsor Earnout Shares [Line Items] | ||
Business combination, initial liability | $ 12.1 | |
Stock Equal to Greater Than $12.50 [Member] | ||
Sponsor Earnout Shares [Line Items] | ||
Share price | $ 12.5 | |
Contingent equity, earnout period, threshold trading days | 20 days | |
Contingent liability, earnout period, threshold consecutive trading days | 30 days | |
Stock Equal to Greater Than $15.00 [Member] | ||
Sponsor Earnout Shares [Line Items] | ||
Share price | $ 15 | |
Contingent equity, earnout period, threshold trading days | 20 days | |
Contingent liability, earnout period, threshold consecutive trading days | 30 days | |
Stock Equal to Greater Than $17.50 [Member] | ||
Sponsor Earnout Shares [Line Items] | ||
Share price | $ 17.5 | |
Contingent equity, earnout period, threshold trading days | 20 days | |
Contingent liability, earnout period, threshold consecutive trading days | 30 days |
Other Liabilities, Summary of_2
Other Liabilities, Summary of Assumptions, Inputs, and Fair Value Results (Details) - Sponsor Earnout Shares [Member] $ / shares in Units, $ in Thousands | Jan. 31, 2024 USD ($) $ / shares | Jan. 31, 2023 USD ($) $ / shares |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Equity Securities, FV-NI | $ | $ 392 | $ 2,445 |
Tranche I [Member] | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Share Price | $ 0.33 | $ 2.12 |
Tranche II [Member] | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Share Price | 0.3 | 1.88 |
Tranche III [Member] | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Share Price | $ 0.28 | $ 1.67 |
Per Share Price of Company Common Stock [Member] | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Equity Securities, FV-NI, Measurement Input | 0.0088 | 0.0362 |
Annual Equity Volitility [Member] | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Equity Securities, FV-NI, Measurement Input | 0.975 | 0.65 |
Risk-Free Rate of Return [Member] | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Equity Securities, FV-NI, Measurement Input | 0.0401 | 0.037 |
Other Liabilities, Purchase Con
Other Liabilities, Purchase Consideration Liability (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||
Apr. 30, 2024 | Mar. 31, 2024 | Feb. 28, 2024 | Jan. 31, 2024 | Apr. 21, 2023 | Oct. 31, 2023 | Jan. 31, 2024 | |
Business Acquisition [Line Items] | |||||||
Shares issued to selling shareholders in connection with distribution | 3,810,108 | ||||||
Earnout period | Aug. 03, 2022 | ||||||
Number of additional shares withheld | 500,000 | ||||||
LookingGlass Earnout Shares and LookingGlass Deferred Shares [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Shares issued to selling shareholders in connection with distribution | 3,810,108 | ||||||
LGCS Earnout Shares [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Shares entitled | $ 2,000 | $ 2,000 | |||||
Earnout period | Feb. 01, 2023 | ||||||
Fair value of earnout shares | 1,100 | $ 2,000 | $ 1,100 | ||||
Triggering Event I [Member] | LGCS Earnout Shares [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Earnout target | 10,000 | ||||||
Contract renew for earnout | $ 12,680,840 | ||||||
Triggering Event II [Member] | LGCS Earnout Shares [Member] | Subsequent Event [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Reduction in earnout shares | 250,000 | ||||||
Triggering Event III [Member] | LGCS Earnout Shares [Member] | Forecast [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Reduction in earnout shares | 500,000 | ||||||
Triggering Event IV [Member] | LGCS Earnout Shares [Member] | Forecast [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Reduction in earnout shares | 750,000 |
Other Liabilities, Summary of F
Other Liabilities, Summary of Fair Value of Purchase Consideration Liability (Details) $ / shares in Units, $ in Thousands | 12 Months Ended |
Jan. 31, 2024 USD ($) $ / shares shares | |
Business Combination, Consideration Transferred, Including Equity Interest in Acquiree Held Prior to Combination [Abstract] | |
Purchase consideration shares | $ | $ 8,766,264 |
Distributed Tranche I purchase consideration shares | shares | (3,810,108) |
Remaining purchase consideration shares | shares | 4,956,156 |
Closing price per share of the Company's Common Stock (ZFOX) | $ / shares | $ 0.88 |
Fair value of purchase consideration liability | $ | $ 4,362 |
Redeemable Convertible Prefer_2
Redeemable Convertible Preferred Stock (Details) - USD ($) $ / shares in Units, $ in Millions | 7 Months Ended | ||
Aug. 03, 2022 | Jan. 31, 2024 | Jul. 29, 2016 | |
Temporary Equity [Line Items] | |||
Share price (in dollars per share) | $ 0.88 | ||
Series A-1 Redeemable Convertible Preferred Stock [Member] | ID Experts Holdings, Inc. and Subsidiary [Member] | |||
Temporary Equity [Line Items] | |||
Convertible preferred shares issued | 6,000,000 | ||
Convertible preferred shares, par value | $ 0.0001 | ||
Share price (in dollars per share) | $ 0.85 | ||
Liquidation preference, Per share | $ 0.85 | ||
Conversion price | $ 2.6325 | ||
Gross proceeds from conversion | $ 50 | ||
Series A-2 Redeemable Convertible Preferred Stock [Member] | ID Experts Holdings, Inc. and Subsidiary [Member] | |||
Temporary Equity [Line Items] | |||
Convertible preferred shares issued | 27,000,000 | ||
Convertible preferred shares, par value | $ 0.0001 | ||
Share price (in dollars per share) | $ 1.053 | ||
Liquidation preference, Per share | $ 1.053 | ||
Conversion price | $ 2.6325 | ||
Gross proceeds from conversion | $ 50 |
Common Stock, Redeemable Conv_3
Common Stock, Redeemable Convertible Preferred Stock, and Stockholders' Equity (Deficit) (Details) - USD ($) $ / shares in Units, $ in Thousands | 6 Months Ended | 7 Months Ended | 12 Months Ended | |||
Jan. 31, 2023 | Aug. 03, 2022 | Aug. 03, 2022 | Jan. 31, 2024 | Dec. 31, 2021 | Jul. 29, 2016 | |
Stockholders' Deficit [Abstract] | ||||||
Authorized capital stock | 1,100,000,000 | |||||
Common stock, shares issued (in shares) | 118,190,135 | 124,639,135 | ||||
Common stock, shares authorized (in shares) | 1,000,000,000 | 1,000,000,000 | ||||
Common Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | ||||
Common stock, shares outstanding (in shares) | 118,190,135 | 124,639,135 | ||||
Change in fair value of warrants | $ (5,364) | $ 2,059 | $ 349 | |||
Common Stock [Member] | ||||||
Stockholders' Deficit [Abstract] | ||||||
Common stock, shares authorized (in shares) | 1,000,000,000 | |||||
Preferred Stock [Member] | ||||||
Stockholders' Deficit [Abstract] | ||||||
Preference shares, shares authorized (in shares) | 100,000,000 | |||||
ID Experts Holdings, Inc. and Subsidiary [Member] | ||||||
Stockholders' Deficit [Abstract] | ||||||
Change in fair value of warrants | $ 133 | |||||
ID Experts Holdings, Inc. and Subsidiary [Member] | Series B Preferred Stock [Member] | ||||||
Stockholders' Deficit [Abstract] | ||||||
Preference shares, par value (in dollars per share) | $ 0.0001 | |||||
Liquidation preference, Per share | $ 0.361 | |||||
Preferred stock outstanding | 0 | 0 | ||||
ID Experts Holdings, Inc. and Subsidiary [Member] | Common Stock [Member] | ||||||
Stockholders' Deficit [Abstract] | ||||||
Common stock, shares authorized (in shares) | 53,000,000 | 53,000,000 | ||||
Common Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | ||||
ID Experts Holdings, Inc. and Subsidiary [Member] | Series A Redeemable Convertible Preferred Stock [Member] | ||||||
Stockholders' Deficit [Abstract] | ||||||
Redeemable convertible preferred stock | $ 10,000 | $ 10,000 | $ 10,000 | |||
Maximum [Member] | ID Experts Holdings, Inc. and Subsidiary [Member] | Series B Preferred Stock [Member] | ||||||
Stockholders' Deficit [Abstract] | ||||||
Preference shares, shares issued (in shares) | 33,000,000 |
Common Stock, Redeemable Conv_4
Common Stock, Redeemable Convertible Preferred Stock, and Stockholders' Equity (Deficit), Schedule of Changes to Conversion Prices and Ratios (Details) | Jan. 31, 2024 $ / shares |
Class of Stock [Line Items] | |
Original Issue Price | $ 0.88 |
Common Stock, Redeemable Conv_5
Common Stock, Redeemable Convertible Preferred Stock, and Stockholders' Equity (Deficit), Schedule of Common Stock Reserved for Future Issuance (Details) - shares | Jan. 31, 2024 | Jan. 31, 2023 |
Class of Stock [Line Items] | ||
Common stock reserved for future issuance | 47,730,572 | 44,008,166 |
Common Stock Warrants [Member] | ||
Class of Stock [Line Items] | ||
Common stock reserved for future issuance | 16,342,106 | 16,213,430 |
Stock Options Issued and Outstanding [Member] | ||
Class of Stock [Line Items] | ||
Common stock reserved for future issuance | 6,484,992 | 7,869,050 |
Restricted Stock Units Issued and Outstanding [Member] | ||
Class of Stock [Line Items] | ||
Common stock reserved for future issuance | 10,751,337 | 2,802,426 |
Sponsor Earn-out Shares [Member] | ||
Class of Stock [Line Items] | ||
Common stock reserved for future issuance | 1,293,750 | 1,293,750 |
Shares Available for Future Grant Under the 2022 Plan [Member] | ||
Class of Stock [Line Items] | ||
Common stock reserved for future issuance | 12,858,387 | 15,829,510 |
Income Taxes - Summary of Compo
Income Taxes - Summary of Components of Loss Before Income Taxes (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | |
Jan. 31, 2023 | Aug. 03, 2022 | Jan. 31, 2024 | |
Income Tax Disclosure [Abstract] | |||
U.S. loss | $ (734,326) | $ (19,370) | $ (366,162) |
Foreign income (loss) | 3,157 | (1,924) | 2,106 |
Loss before income taxes | $ (731,169) | $ (21,294) | $ (364,056) |
Income Taxes, Summary of Provis
Income Taxes, Summary of Provision for Income Taxes (Details) - USD ($) $ in Thousands | 6 Months Ended | 7 Months Ended | 12 Months Ended | |
Jan. 31, 2023 | Aug. 03, 2022 | Aug. 03, 2022 | Jan. 31, 2024 | |
Current tax provision: | ||||
Federal | $ (185) | |||
Foreign | $ 177 | $ 106 | 313 | |
State and local | 292 | 5 | 627 | |
Total current tax expense | 469 | 111 | 755 | |
Deferred tax (benefit) expense: | ||||
Federal | (9,360) | (2,780) | (15,111) | |
State and local | (2,281) | (911) | (3,527) | |
Total deferred tax (benefit) expense | (11,641) | (3,691) | (18,638) | |
Less: change in valuation allowance | 650 | 3,691 | 10,137 | |
Net income tax (benefit) expense | (10,522) | 111 | (7,746) | |
Income (loss) from continuing operations before income taxes | $ (731,169) | $ (21,294) | $ (364,056) | |
Net income tax expense | 1.44% | (0.52%) | 2.13% | |
ID Experts Holdings, Inc. and Subsidiary [Member] | ||||
Current tax provision: | ||||
Federal | $ 1,645 | |||
State and local | 361 | |||
Total current tax expense | 2,006 | |||
Deferred tax (benefit) expense: | ||||
Federal | (1,129) | |||
State and local | (225) | |||
Total deferred tax (benefit) expense | (1,354) | |||
Net income tax (benefit) expense | 652 | |||
Income (loss) from continuing operations before income taxes | $ (205) |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 6 Months Ended | 7 Months Ended | 12 Months Ended | ||
Jan. 31, 2023 | Aug. 03, 2022 | Aug. 03, 2022 | Jan. 31, 2024 | Feb. 01, 2022 | |
Income Tax Disclosure [Line Items] | |||||
Statutory federal income tax rate | 21% | 21% | 21% | ||
Valuation allowances | $ 28,000 | ||||
Unrecognized tax benefits | $ 838 | 1,768 | $ 0 | ||
Decrease in unrecognized tax benefits | (100) | ||||
Income tax benefit | $ 10,522 | $ (111) | 7,746 | ||
Accrued penalties and interest | $ 300 | ||||
Minimum [Member] | |||||
Income Tax Disclosure [Line Items] | |||||
Tax Year Expiration Year | 2033 | ||||
Maximum [Member] | |||||
Income Tax Disclosure [Line Items] | |||||
Tax Year Expiration Year | 2037 | ||||
Federal [Member] | |||||
Income Tax Disclosure [Line Items] | |||||
Net operating loss carryforwards | $ 226,400 | ||||
Open Tax Year | 2020 2021 2022 2023 | ||||
NOL carryforwards subject to expiration | $ 75,000 | ||||
State [Member] | |||||
Income Tax Disclosure [Line Items] | |||||
Net operating loss carryforwards | $ 105,700 | ||||
Open Tax Year | 2018 2019 2020 2021 2022 2023 | ||||
NOL carryforwards subject to expiration | $ 70,000 | ||||
ID Experts Holdings, Inc. and Subsidiary [Member] | |||||
Income Tax Disclosure [Line Items] | |||||
Statutory federal income tax rate | 21% | ||||
Unrecognized tax benefits | 800 | $ 800 | |||
Income tax benefit | (652) | ||||
Accrued penalties and interest | $ 100 | $ 100 |
Income Taxes - Summary of Diffe
Income Taxes - Summary of Differences as Result of which Income Tax Provision Differs from Amount Computed by Applying Statutory Federal Income Tax Rate to Income (Loss) Before Income Tax (Details) - USD ($) $ in Thousands | 6 Months Ended | 7 Months Ended | 12 Months Ended | |
Jan. 31, 2023 | Aug. 03, 2022 | Aug. 03, 2022 | Jan. 31, 2024 | |
Effective Income Tax Rate Reconciliation, Percent [Abstract] | ||||
U.S. statutory rate | 21% | 21% | 21% | |
State taxes | 0.21% | 3.35% | 0.63% | |
Foreign taxes | (0.09%) | |||
Goodwill impairment | (20.07%) | (16.40%) | ||
Transaction costs | (3.23%) | |||
Fair value adjustments | (2.03%) | |||
Other permanent differences | 0.41% | (1.05%) | (0.27%) | |
Change in valuation allowance | (0.09%) | (17.32%) | (2.78%) | |
Other | (0.02%) | (1.24%) | 0.04% | |
Net income tax expense | 1.44% | (0.52%) | 2.13% | |
Net income tax (benefit) expense | $ (10,522) | $ 111 | $ (7,746) | |
ID Experts Holdings, Inc. and Subsidiary [Member] | ||||
Effective Income Tax Rate Reconciliation, Percent [Abstract] | ||||
U.S. statutory rate | 21% | |||
Income taxes at statutory rate | $ (43) | |||
State income tax, net of federal benefit | (12) | |||
Permanent items | 4 | |||
Non-deductible transaction costs | 625 | |||
Non-deductible convertible debt and warrant expense | 150 | |||
Stock-based compensation | (145) | |||
Tax credits | (25) | |||
Loss of attributes | 25 | |||
Uncertain tax positions | 106 | |||
Other | (21) | |||
Valuation allowance | (12) | |||
Net income tax (benefit) expense | $ 652 |
Income Taxes - Summary of Tempo
Income Taxes - Summary of Temporary Differences that Give Rise to Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Jan. 31, 2024 | Jan. 31, 2023 | Feb. 01, 2022 |
Income Tax Disclosure [Line Items] | |||
Net operating losses - federal and state | $ 54,332 | $ 36,057 | |
Research and development expense/ expenditures | 13,128 | 4,793 | |
Deferred revenue | 1,756 | 3,019 | |
Interest expense | 9,052 | 2,544 | |
Accruals | 1,196 | 1,240 | |
Capital loss carryforward | 1,788 | ||
Credits | 2,667 | ||
Stock-based compensation | 709 | 574 | |
Other, net | 665 | 308 | |
Lease liability | 910 | 204 | |
Depreciation and amortization | (28) | 112 | |
Allowance for doubtful accounts | 48 | 35 | |
Charitable contributions | 6 | 3 | |
Total deferred tax assets before valuation allowance/Deferred assets, gross: | 86,229 | 48,889 | |
Valuation allowance | (33,702) | (5,720) | $ (5,070) |
Total deferred tax assets | 52,527 | 43,169 | |
Intangible assets | (52,333) | (61,109) | |
Contract acquisition costs | (2,392) | (3,256) | |
Goodwill | (701) | (258) | |
Right-of-use assets | (862) | (177) | |
Other, net | (458) | (7) | |
Total deferred tax liabilities | (56,746) | (64,807) | |
Net deferred tax liability | $ (4,219) | $ (21,638) |
Income Taxes - Summary of Chang
Income Taxes - Summary of Change In Gross Unrecognized Tax Benefits, Excluding Accrued Interest And Penalties (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 31, 2024 | Jan. 31, 2023 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | ||
Balance at beginning of year | $ 838 | |
Business Combination | $ 838 | |
Adjustments to the Business Combination | 460 | |
Business acquisition | 472 | |
Current period adjustments | 252 | |
Settlement with tax authorities | (80) | |
Statute expirations | (174) | |
Balance at end of year | $ 1,768 | $ 838 |
Income Taxes - Summary of Valua
Income Taxes - Summary of Valuation Allowance of Deferred Tax Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 31, 2024 | Jan. 31, 2023 | |
Valuation Allowance [Abstract] | ||
Balance at beginning of period | $ 5,720 | |
Increases to allowance | 10,137 | $ 650 |
Increases due to business acquisition | 17,845 | |
Balance at end of period | $ 33,702 | $ 5,720 |
Retirement Plan (Details)
Retirement Plan (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended |
Jan. 31, 2023 | Jan. 31, 2024 | |
Defined Benefit Plan Disclosure [Line Items] | ||
Contributed to plan | $ 0.1 | $ 0.4 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) - USD ($) | 6 Months Ended | 7 Months Ended | 12 Months Ended | |||||||||||
Jan. 31, 2024 | Jan. 31, 2023 | Aug. 31, 2017 | Aug. 31, 2016 | Jan. 31, 2024 | Jan. 31, 2023 | Aug. 03, 2022 | Jun. 30, 2022 | Aug. 03, 2022 | Jan. 31, 2024 | Aug. 03, 2023 | Aug. 04, 2022 | Jan. 31, 2022 | Dec. 31, 2021 | |
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||||||||||||
Options granted | 0 | 1,214,500 | 0 | |||||||||||
Incremental compensation cost | $ 0 | |||||||||||||
Stock options issued | 0 | |||||||||||||
Number of shares authorized | 0 | 0 | 0 | |||||||||||
Shares awards available for outstanding under plan | 6,484,992 | 7,869,050 | 6,484,992 | 7,869,050 | 22,285,706 | 22,285,706 | 6,484,992 | 8,159,377 | 21,715,815 | |||||
Stock-based compensation expense | $ 2,500,000 | $ 862,000 | $ 7,525,000 | |||||||||||
RSUs [Member] | ||||||||||||||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||||||||||||
RSUs granted | 2,827,426 | 10,038,454 | ||||||||||||
2022 Incentive Equity Plan [Member] | ||||||||||||||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||||||||||||
Percentage of increase to number of shares available for issuance | 5 | |||||||||||||
Increase to number of shares available for issuance | 6,228,005 | 5,909,396 | ||||||||||||
Shares available for issuance under plan | 12,858,387 | 12,858,387 | 12,858,387 | |||||||||||
2022 Incentive Equity Plan [Member] | Maximum [Member] | ||||||||||||||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||||||||||||
Number of shares authorized | 11,750,135 | 11,750,135 | ||||||||||||
Term of stock-based award | 10 years | |||||||||||||
2022 Incentive Equity Plan [Member] | Minimum [Member] | ||||||||||||||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||||||||||||
Stock-based awards granted at exercise price percentage | 100% | |||||||||||||
Zero Fox [Member] | ||||||||||||||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||||||||||||
Options granted | 6,380,458 | |||||||||||||
Weighted average grant date fair value of options granted | $ 1 | |||||||||||||
Share-based compensation arrangement by share-based payment award, total intrinsic value of options exercised | $ 600,000 | $ 1,000,000 | $ 1,500,000 | |||||||||||
Stock-based compensation unrecognized compensation cost | $ 1,700,000 | |||||||||||||
Weighted average remaining period of unrecognized compensation cost to be recognized | 1 year 8 months 12 days | |||||||||||||
Zero Fox [Member] | RSUs [Member] | ||||||||||||||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||||||||||||
Stock-based compensation unrecognized compensation cost | $ 16,600,000 | |||||||||||||
Weighted average remaining period of unrecognized compensation cost to be recognized | 3 years | |||||||||||||
RSUs granted | 0 | |||||||||||||
Zero Fox [Member] | Maximum [Member] | RSUs [Member] | ||||||||||||||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||||||||||||
Share-based compensation arrangement by share-based payment award, vesting period | 4 years | |||||||||||||
Zero Fox [Member] | Minimum [Member] | RSUs [Member] | ||||||||||||||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||||||||||||
Share-based compensation arrangement by share-based payment award, vesting period | 1 year | |||||||||||||
IDX [Member] | ||||||||||||||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||||||||||||
Options granted | 1,778,919 | |||||||||||||
ID Experts Holdings, Inc. and Subsidiary [Member] | ||||||||||||||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||||||||||||
Options granted | 72,500 | |||||||||||||
Shares awards available for outstanding under plan | 2,580,682 | 2,843,372 | ||||||||||||
Stock compensation expense recognized over an average period | 3 years 21 days | |||||||||||||
Weighted average grant date fair value of options granted | $ 1.97 | |||||||||||||
Weighted average fair value of options exercised | $ 0.04 | |||||||||||||
Share-based compensation arrangement by share-based payment award, total intrinsic value of options exercised | $ 1,300,000 | |||||||||||||
Weighted-average dividend yield | 0% | |||||||||||||
Fair value of common stock options vested | $ 1,400,000 | |||||||||||||
ID Experts Holdings, Inc. and Subsidiary [Member] | 2016 Equity Incentive Plan [Member] | ||||||||||||||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||||||||||||
Shares available for issuance under plan | 265,000 | |||||||||||||
Term of stock-based award | 10 years | |||||||||||||
ID Experts Holdings, Inc. and Subsidiary [Member] | 2016 Equity Incentive Plan [Member] | Maximum [Member] | ||||||||||||||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||||||||||||
Number of shares authorized | 6,287,732 | |||||||||||||
Stock-based awards granted at exercise price percentage | 100% | |||||||||||||
Share-based compensation arrangement by share-based payment award, vesting period | 48 months | |||||||||||||
ID Experts Holdings, Inc. and Subsidiary [Member] | 2017 Equity Incentive Plan [Member] | ||||||||||||||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||||||||||||
Shares awards available for outstanding under plan | 2,313,442 | 2,313,442 | ||||||||||||
Shares available for issuance under plan | 299,217 | 299,217 | ||||||||||||
Term of stock-based award | 10 years | |||||||||||||
ID Experts Holdings, Inc. and Subsidiary [Member] | 2017 Equity Incentive Plan [Member] | Maximum [Member] | ||||||||||||||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||||||||||||
Number of shares authorized | 8,785,330 | |||||||||||||
Stock-based awards granted at exercise price percentage | 100% | |||||||||||||
Share-based compensation arrangement by share-based payment award, vesting period | 60 months |
Stock-Based Compensation, Summa
Stock-Based Compensation, Summary of Weighted-average Assumptions (Details) - ID Experts Holdings, Inc. and Subsidiary [Member] | 7 Months Ended |
Aug. 03, 2022 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Weighted-average risk-free rate | 2.20% |
Weighted-average expected term of the option (in years) | 7 years |
Weighted-average expected volatility | 35% |
Weighted-average dividend yield | 0% |
Stock-Based Compensation, Sum_2
Stock-Based Compensation, Summary of Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 6 Months Ended | 12 Months Ended | |||||||
Jan. 31, 2023 | Aug. 04, 2022 | Aug. 03, 2022 | Jan. 31, 2022 | Jan. 31, 2023 | Aug. 03, 2022 | Jun. 30, 2022 | Jan. 31, 2024 | Dec. 31, 2021 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding [Roll Forward] | |||||||||
Number of Shares Option Outstanding, Beginning Balance | 22,285,706 | 22,285,706 | 21,715,815 | 7,869,050 | |||||
Number of Shares, Granted | 0 | 1,214,500 | 0 | ||||||
Number of Shares, Exercised | (206,476) | (392,450) | (1,003,474) | ||||||
Number of Shares, Cancelled | (83,851) | (252,159) | (380,584) | ||||||
Number of Shares Option Outstanding, Ending Balance | 7,869,050 | 8,159,377 | 22,285,706 | 21,715,815 | 7,869,050 | 22,285,706 | 6,484,992 | ||
Number of Shares Option, Vested | 5,772,232 | 14,783,495 | 5,772,232 | 14,783,495 | 5,814,238 | ||||
Number of Shares Option, Vested and expected to vest | 7,135,156 | 19,659,894 | 7,135,156 | 19,659,894 | 6,250,237 | ||||
Weighted-Average Exercise Price | |||||||||
Weighted- Average Exercise Price, Outstanding, Beginning Balance | $ 0.5377 | $ 0.5377 | $ 0.4398 | $ 1.5454 | |||||
Weighted- Average Exercise Price, Granted | 2.392 | ||||||||
Weighted- Average Exercise Price, Exercised | 0.5952 | 0.2659 | 0.2565 | ||||||
Weighted- Average Exercise Price, Cancelled | 2.9681 | 1.4633 | 4.0963 | ||||||
Weighted- Average Exercise Price, Outstanding, Ending Balance | $ 1.5454 | $ 1.536 | $ 0.5377 | $ 0.4398 | 1.5454 | 0.5377 | 1.5856 | ||
Weighted- Average Exercise Price, Vested | 0.9591 | 0.266 | 0.9591 | 0.266 | 1.2651 | ||||
Weighted- Average Exercise Price, Vested and expected to vest | $ 1.3793 | $ 0.4662 | $ 1.3793 | $ 0.4662 | $ 1.4812 | ||||
Weighted-Average Remaining Contractual Term (in years) | |||||||||
Weighted- Average Remaining Contractual Term (Years), Outstanding | 6 years 25 days | 6 years 3 days | 6 years 3 months 10 days | 6 years 25 days | 6 years 5 months 12 days | 4 years 11 months 15 days | |||
Weighted- Average Remaining Contractual Term (Years), Vested | 5 years 4 months 28 days | 5 years 4 months 20 days | 4 years 8 months 1 day | ||||||
Weighted- Average Remaining Contractual Term (Years), Vested and expected to vest | 5 years 10 months 17 days | 6 years 2 months 1 day | 4 years 10 months 9 days | ||||||
Aggregate Intrinsic Value | |||||||||
Aggregate Intrinsic Value, Outstanding | $ 16,325 | $ 17,004 | $ 50,864 | $ 51,688 | $ 16,325 | $ 50,864 | $ 1,131 | ||
Aggregate Intrinsic Value, Vested | 15,359 | 37,757 | 15,359 | 37,757 | 1,055 | ||||
Aggregate Intrinsic Value, Vested and expected to vest | $ 15,987 | $ 46,276 | $ 15,987 | $ 46,276 | $ 1,104 | ||||
ID Experts Holdings, Inc. and Subsidiary [Member] | |||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding [Roll Forward] | |||||||||
Number of Shares Option Outstanding, Beginning Balance | 2,843,372 | ||||||||
Number of Shares, Granted | 72,500 | ||||||||
Number of Shares, Exercised | (272,766) | ||||||||
Number of Shares, Cancelled | (62,424) | ||||||||
Number of Shares Option Outstanding, Ending Balance | 2,580,682 | 2,843,372 | |||||||
Number of Shares Option, Vested | 1,556,944 | ||||||||
Weighted-Average Exercise Price | |||||||||
Weighted- Average Exercise Price, Outstanding, Beginning Balance | $ 0.14 | ||||||||
Weighted- Average Exercise Price, Granted | 1.97 | ||||||||
Weighted- Average Exercise Price, Exercised | 0.04 | ||||||||
Weighted- Average Exercise Price, Cancelled | 0.38 | ||||||||
Weighted- Average Exercise Price, Outstanding, Ending Balance | 0.2 | $ 0.14 | |||||||
Weighted- Average Exercise Price, Vested | $ 0.17 | ||||||||
Weighted-Average Remaining Contractual Term (in years) | |||||||||
Weighted- Average Remaining Contractual Term (Years), Outstanding | 6 years 6 months | 7 years 3 months 18 days | |||||||
Weighted- Average Remaining Contractual Term (Years), Vested | 5 years 3 months 18 days | ||||||||
Aggregate Intrinsic Value | |||||||||
Aggregate Intrinsic Value, Outstanding | $ 11,998 | $ 5,768 | |||||||
Aggregate Intrinsic Value, Vested | $ 7,300 |
Stock-Based Compensation, Sum_3
Stock-Based Compensation, Summary of RSU Activity (Details) - RSUs [Member] - $ / shares | 6 Months Ended | 12 Months Ended |
Jan. 31, 2023 | Jan. 31, 2024 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Number of Shares Outstanding, Beginning Balance | 2,802,426 | |
Number of Shares, Granted | 2,827,426 | 10,038,454 |
Number of Shares, Vested | (1,635,418) | |
Number of Shares, Cancelled | (25,000) | (454,125) |
Number of Shares Outstanding, Ending Balance | 2,802,426 | 10,751,337 |
Weighted-Average Grant Date Fair Value Outstanding, Beginning Balance | $ 4.64 | |
Weighted-Average Grant Date Fair Value, Granted | $ 4.64 | 1.29 |
Weighted-Average Grant Date Fair Value, Vested | 3.29 | |
Weighted-Average Grant Date Fair Value, Cancelled | 4.63 | 2.98 |
Weighted-Average Grant Date Fair Value Outstanding, Ending Balance | $ 4.64 | $ 1.79 |
Stock-Based Compensation, Sum_4
Stock-Based Compensation, Summary of Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | |
Jan. 31, 2023 | Aug. 03, 2022 | Jan. 31, 2024 | |
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total stock-based compensation expense | $ 2,500 | $ 862 | $ 7,525 |
Cost of Revenue - Subscription [Member] | |||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total stock-based compensation expense | 97 | 18 | 219 |
Cost of Revenue - Services [Member] | |||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total stock-based compensation expense | 36 | 2 | 111 |
Research and Development [Member] | |||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total stock-based compensation expense | 452 | 114 | 1,637 |
Sales and Marketing [Member] | |||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total stock-based compensation expense | 518 | 218 | 1,612 |
General and Administrative [Member] | |||
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total stock-based compensation expense | $ 1,397 | $ 510 | $ 3,946 |
Earnings (Loss) per Share, Summ
Earnings (Loss) per Share, Summary of Basic and Diluted Calculations (Details) - USD ($) $ / shares in Units, $ in Thousands | 6 Months Ended | 7 Months Ended | 12 Months Ended | |
Jan. 31, 2023 | Aug. 03, 2022 | Aug. 03, 2022 | Jan. 31, 2024 | |
Earnings (Loss) per Share [Line Items] | ||||
Net Income (Loss) | $ (720,647) | $ (21,405) | $ (356,310) | |
Basic Earnings per Share | ||||
Net income (loss) applicable to common stockholders | $ (720,647) | $ (21,405) | $ (356,310) | |
Total weighted-average basic shares outstanding | 116,862,277 | 43,041,209 | 123,813,143 | |
Net income (loss) per share, basic | $ (6.17) | $ (0.5) | $ (2.88) | |
Diluted Earnings per Share | ||||
Total weighted-average diluted shares outstanding | 116,862,277 | 43,041,209 | 123,813,143 | |
Net income (loss) per share, diluted | $ (6.17) | $ (0.5) | $ (2.88) | |
ID Experts Holdings, Inc. and Subsidiary [Member] | ||||
Earnings (Loss) per Share [Line Items] | ||||
Net Income (Loss) | $ (857) | |||
Basic Earnings per Share | ||||
Net income (loss) applicable to common stockholders | $ (857) | |||
Total weighted-average basic shares outstanding | 12,854,967 | |||
Net income (loss) per share, basic | $ (0.07) | |||
Diluted Earnings per Share | ||||
Total weighted-average diluted shares outstanding | 12,854,967 | |||
Net income (loss) per share, diluted | $ (0.07) |
Related Party Transactions (Det
Related Party Transactions (Details) - ID Experts Holdings, Inc. and Subsidiary [Member] $ in Millions | 7 Months Ended |
Aug. 03, 2022 USD ($) | |
Cost of Services [Member] | |
Related Party Transaction [Line Items] | |
Expense from contracts | $ 0.1 |
Contracts with Affiliates of Majority Stockholders [Member] | |
Related Party Transaction [Line Items] | |
Expense from contracts | 0.1 |
Related Party [Member] | Contracts with Affiliates of Minority Stockholders [Member] | |
Related Party Transaction [Line Items] | |
Revenue from contracts | $ 0.6 |
Related Party Transactions, Bal
Related Party Transactions, Baltimore Headquarters Lease (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | |
Jan. 31, 2023 | Aug. 03, 2022 | Jan. 31, 2024 | |
Related Party Transaction [Line Items] | |||
Rent expense | $ 0.2 | $ 0.2 | $ 0.4 |
Leasehold improvements | 0.1 | ||
Net of accumulated depreciation | 0.1 | ||
Security deposit | $ 0.1 |
Related Party Transactions, PIP
Related Party Transactions, PIPE Investors Notes (Details) $ in Millions | 6 Months Ended |
Aug. 03, 2022 USD ($) | |
Bridge Notes [Member] | PIPE [Member] | |
Related Party Transaction [Line Items] | |
Principle value of related notes | $ 5 |
PIPE [Member] | |
Related Party Transaction [Line Items] | |
Payment-in-kind interest | $ 0.2 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | |
Jan. 31, 2023 | Jan. 31, 2024 | Aug. 03, 2022 | |
Commitments and Contingencies Disclosure [Line Items] | |||
Contributed to plan | $ 0.1 | $ 0.4 | |
Purchase commitment | 72.4 | ||
ID Experts Holdings, Inc. and Subsidiary [Member] | |||
Commitments and Contingencies Disclosure [Line Items] | |||
Purchase commitment | $ 58.9 | ||
Accrual of sales and use taxes | $ 1.5 | $ 1.3 |
Net Loss per Share Attributab_3
Net Loss per Share Attributable to Common Stockholders - Computation of Basic Loss Per Share Attributable to Common Stockholders (Details) - USD ($) $ / shares in Units, $ in Thousands | 6 Months Ended | 12 Months Ended | |
Jan. 31, 2023 | Aug. 03, 2022 | Jan. 31, 2024 | |
Numerator [Abstract] | |||
Net loss | $ (720,647) | $ (21,405) | $ (356,310) |
Net loss per share attributable to common stockholders | $ (720,647) | $ (21,405) | $ (356,310) |
Denominator [Abstract] | |||
Weighted-average common stock outstanding (in shares) | 116,862,277 | 43,041,209 | 123,813,143 |
Net loss per share attributable to common stockholders, basic | $ (6.17) | $ (0.5) | $ (2.88) |
Net loss per share attributable to common stockholders, diluted | $ (6.17) | $ (0.5) | $ (2.88) |
Net Loss per Share Attributab_4
Net Loss per Share Attributable to Common Stockholders - Summary of Weighted Average Common Stock Outstanding Excluded From Computation of Diluted Net Loss Per Common Share (Details) - shares | 6 Months Ended | 12 Months Ended | |
Jan. 31, 2023 | Aug. 03, 2022 | Jan. 31, 2024 | |
Preferred Stock (on an as-converted Basis) [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Weighted average common stock outstanding excluded from computation of diluted net loss per common share | 241,238,877 | ||
Common Stock [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Weighted average common stock outstanding excluded from computation of diluted net loss per common share | 1,293,750 | 2,648,161 | |
Warrants [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Weighted average common stock outstanding excluded from computation of diluted net loss per common share | 16,220,756 | 5,794,517 | 16,314,256 |
Series Seed Redeemable Convertible Preferred Stock [Member] | Preferred Stock (on an as-converted Basis) [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Weighted average common stock outstanding excluded from computation of diluted net loss per common share | 18,396,744 | ||
Series A Redeemable Convertible Preferred Stock [Member] | Preferred Stock (on an as-converted Basis) [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Weighted average common stock outstanding excluded from computation of diluted net loss per common share | 31,994,570 | ||
Series B Redeemable Convertible Preferred Stock [Member] | Preferred Stock (on an as-converted Basis) [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Weighted average common stock outstanding excluded from computation of diluted net loss per common share | 53,829,898 | ||
Series C Redeemable Convertible Preferred Stock [Member] | Preferred Stock (on an as-converted Basis) [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Weighted average common stock outstanding excluded from computation of diluted net loss per common share | 42,249,398 | ||
Series C-1 Redeemable Convertible Preferred Stock [Member] | Preferred Stock (on an as-converted Basis) [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Weighted average common stock outstanding excluded from computation of diluted net loss per common share | 22,790,767 | ||
Series D Redeemable Convertible Preferred Stock [Member] | Preferred Stock (on an as-converted Basis) [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Weighted average common stock outstanding excluded from computation of diluted net loss per common share | 27,743,094 | ||
Series D-1 Redeemable Convertible Preferred Stock [Member] | Preferred Stock (on an as-converted Basis) [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Weighted average common stock outstanding excluded from computation of diluted net loss per common share | 11,756,606 | ||
Series D-2 Redeemable Convertible Preferred Stock [Member] | Preferred Stock (on an as-converted Basis) [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Weighted average common stock outstanding excluded from computation of diluted net loss per common share | 1,987,736 | ||
Series E Redeemable Convertible Preferred Stock [Member] | Preferred Stock (on an as-converted Basis) [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Weighted average common stock outstanding excluded from computation of diluted net loss per common share | 30,490,064 | ||
Common Stock Warrants [Member] | Warrants [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Weighted average common stock outstanding excluded from computation of diluted net loss per common share | 16,220,756 | 1,924,790 | 16,314,256 |
Series A Redeemable Convertible Preferred Stock Warrants [Member] | Warrants [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Weighted average common stock outstanding excluded from computation of diluted net loss per common share | 249,806 | 0 | |
Series B Redeemable Convertible Preferred Stock Warrants [Member] | Warrants [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Weighted average common stock outstanding excluded from computation of diluted net loss per common share | 292,682 | 0 | |
Series C-1 Redeemable Convertible Preferred Stock Warrants [Member] | Warrants [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Weighted average common stock outstanding excluded from computation of diluted net loss per common share | 1,247,369 | 0 | |
Series E Redeemable Convertible Preferred Stock Warrants [Member] | Warrants [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Weighted average common stock outstanding excluded from computation of diluted net loss per common share | 2,079,870 | 0 | |
Purchase Consideration Liability Shares [Member] | Common Stock [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Weighted average common stock outstanding excluded from computation of diluted net loss per common share | 1,354,411 | ||
Sponsor Earn-out Shares [Member] | Common Stock [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Weighted average common stock outstanding excluded from computation of diluted net loss per common share | 1,293,750 | 1,293,750 | |
Common Stock Options Issued [Member] | Options to Purchase Common Stock [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Weighted average common stock outstanding excluded from computation of diluted net loss per common share | 7,926,307 | 22,178,814 | 6,917,053 |
Common Stock Options Outstanding [Member] | Options to Purchase Common Stock [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Weighted average common stock outstanding excluded from computation of diluted net loss per common share | 7,926,307 | 22,178,814 | 6,917,053 |
Restricted Stock Units Issued [Member] | Restricted Stock Units [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Weighted average common stock outstanding excluded from computation of diluted net loss per common share | 747,405 | 8,013,568 | |
Restricted stock units outstanding [Member] | Restricted Stock Units [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Weighted average common stock outstanding excluded from computation of diluted net loss per common share | 747,405 | 8,013,568 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) | 12 Months Ended | |||||
Feb. 06, 2024 | Aug. 03, 2022 | Jan. 31, 2024 | Mar. 04, 2024 | Feb. 21, 2024 | Jan. 31, 2023 | |
Subsequent Event [Line Items] | ||||||
Lease agreement payments due | $ 4,114,000 | |||||
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 | ||||
Share price (in dollars per share) | $ 0.88 | |||||
Accrued and unpaid interest percentage | 100% | |||||
Convertible Senior Cash [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Accrued and unpaid interest percentage | 100% | 100% | ||||
Investors agreed purchase value in aggregate principal amount | $ 150,000,000 | |||||
Haveli Merger Agreement [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Merger agreement description of termination rights | The Haveli Merger Agreement contains termination rights for each of the Company and Parent, including, among others, (1) if the consummation of the Merger does not occur on or before August 6, 2024 (subject to extension until November 6, 2024 under specified circumstances), (2) if the Company Stockholder Approval is not obtained following the meeting of the Company’s stockholders for purposes of obtaining such Company Stockholder Approval and (3) subject to certain conditions, (a) by Parent if the Board changes its recommendation in favor of the Merger or (b) by the Company in connection with the entry into a definitive agreement with respect to a Superior Proposal (as defined in the Haveli Merger Agreement). The Company and Parent may also terminate the Haveli Merger Agreement by mutual written consent. | |||||
Subsequent Event [Member] | Convertible Senior Cash [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Investors agreed purchase value in aggregate principal amount | $ 135,000,000 | $ 25,300,000 | $ 8,400,000 | |||
Subsequent Event [Member] | Haveli Merger Agreement [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Common stock, par value (in dollars per share) | $ 0.0001 | |||||
Share price (in dollars per share) | $ 1.14 | |||||
Business combination termination fee | $ 5,261,750 | |||||
Business combination reverse termination fee | $ 10,000,000 | |||||
Subsequent Event [Member] | Haveli Merger Agreement [Member] | LookingGlass [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Maximum number of shares remain issuable | 5,558,552 |