Cover Page Cover Page
Cover Page Cover Page - shares | 3 Months Ended | |
Oct. 31, 2020 | Nov. 13, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Oct. 31, 2020 | |
Document Transition Report | false | |
Entity File Number | 001-35594 | |
Entity Registrant Name | PALO ALTO NETWORKS, INC | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 20-2530195 | |
Entity Address, Address Line One | 3000 Tannery Way | |
Entity Address, City or Town | Santa Clara | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 95054 | |
City Area Code | 408 | |
Local Phone Number | 753-4000 | |
Title of 12(b) Security | Common stock, $0.0001 par value per share | |
Trading Symbol | PANW | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Small Business | false | |
Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 95,211,700 | |
Entity Central Index Key | 0001327567 | |
Document Fiscal Year End Date | --07-31 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Oct. 31, 2020 | Jul. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 2,142 | $ 2,958 |
Short-term investments | 1,075.6 | 789.8 |
Accounts receivable, net of allowance for credit losses of $9.0 and $2.3 at October 31, 2020 and July 31, 2020, respectively | 675.5 | 1,037.1 |
Prepaid expenses and other current assets | 407.8 | 344.3 |
Total current assets | 4,300.9 | 5,129.2 |
Property and equipment, net | 337.9 | 348.1 |
Operating lease right-of-use assets | 251.2 | 258.7 |
Long-term investments | 873.2 | 554.4 |
Goodwill | 1,968.6 | 1,812.9 |
Intangible assets, net | 388.8 | 358.2 |
Other assets | 605.9 | 603.9 |
Total assets | 8,726.5 | 9,065.4 |
Current liabilities: | ||
Accounts payable | 48.5 | 63.6 |
Accrued compensation | 188.4 | 322.2 |
Accrued and other liabilities | 260.7 | 256.8 |
Deferred revenue | 2,137.5 | 2,049.1 |
Total current liabilities | 2,635.1 | 2,691.7 |
Convertible senior notes, net | 3,119.2 | 3,084.1 |
Long-term deferred revenue | 1,809.3 | 1,761.1 |
Long-term operating lease liabilities | 323.9 | 336.6 |
Other long-term liabilities | 92 | 90.1 |
Commitments and contingencies (Note 11) | ||
Stockholders’ equity: | ||
Preferred stock; $0.0001 par value; 100.0 shares authorized; none issued and outstanding at October 31, 2020 and July 31, 2020 | 0 | 0 |
Common stock and additional paid-in capital; $0.0001 par value; 1,000.0 shares authorized; 95.2 and 96.3 shares issued and outstanding at October 31, 2020 and July 31, 2020, respectively | 2,003.9 | 2,259.2 |
Accumulated other comprehensive income | 3.2 | 10.5 |
Accumulated deficit | (1,260.1) | (1,167.9) |
Total stockholders’ equity | 747 | 1,101.8 |
Total liabilities and stockholders’ equity | $ 8,726.5 | $ 9,065.4 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions | Oct. 31, 2020 | Jul. 31, 2020 |
Current assets: | ||
Allowance for doubtful accounts | $ 9 | $ 2.3 |
Stockholders’ equity: | ||
Preferred stock, par value (in usd per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in usd per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued (in shares) | 95,200,000 | 96,300,000 |
Common stock, shares outstanding (in shares) | 95,200,000 | 96,300,000 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Oct. 31, 2020 | Oct. 31, 2019 | |
Revenue: | ||
Revenue: | $ 946 | $ 771.9 |
Cost of revenue: | ||
Cost of revenue: | 277.8 | 217.7 |
Total gross profit | 668.2 | 554.2 |
Operating expenses: | ||
Research and development | 237.4 | 170.5 |
Sales and marketing | 388.6 | 365.7 |
General and administrative | 86.7 | 69.8 |
Total operating expenses | 712.7 | 606 |
Operating loss | (44.5) | (51.8) |
Interest expense | (40.2) | (18.9) |
Other income, net | 2.4 | 16.2 |
Loss before income taxes | (82.3) | (54.5) |
Provision for income taxes | 9.9 | 5.1 |
Net loss | $ (92.2) | $ (59.6) |
Net loss per share, basic and diluted | $ (0.97) | $ (0.62) |
Weighted-average shares used to compute net loss per share, basic and diluted | 95.5 | 96.6 |
Product | ||
Revenue: | ||
Revenue: | $ 237.3 | $ 231.2 |
Cost of revenue: | ||
Cost of revenue: | 62.2 | 65.1 |
Subscription and support | ||
Revenue: | ||
Revenue: | 708.7 | 540.7 |
Cost of revenue: | ||
Cost of revenue: | $ 215.6 | $ 152.6 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Millions | 3 Months Ended | |
Oct. 31, 2020 | Oct. 31, 2019 | |
Statement of Comprehensive Income [Abstract] | ||
Net loss | $ (92.2) | $ (59.6) |
Other comprehensive income (loss), net of tax: | ||
Change in unrealized gains (losses) on investments | (1.3) | 2.7 |
Change in unrealized gains (losses) on cash flow hedges | (6) | 0.4 |
Other comprehensive income (loss) | (7.3) | 3.1 |
Comprehensive loss | $ (99.5) | $ (56.5) |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY Statement - USD ($) shares in Millions, $ in Millions | Total | Common stock | Common stock and additional paid in capital | Accumulated other comprehensive income (loss) | Accumulated Deficit |
Common stock, beginning balance (in shares) at Jul. 31, 2019 | 96.8 | ||||
Beginning balance at Jul. 31, 2019 | $ 1,586.3 | $ 2,490.9 | $ (3.7) | $ (900.9) | |
Increase (Decrease) in Stockholders' Equity | |||||
Net loss | (59.6) | (59.6) | |||
Other comprehensive income (loss) | 3.1 | 3.1 | |||
Issuance of common stock in connection with employee equity incentive plans (in shares) | 1 | ||||
Issuance of common stock in connection with employee equity incentive plans | 36.3 | 36.3 | |||
Taxes paid related to net share settlement of equity awards | (5.3) | (5.3) | |||
Share-based compensation for equity-based awards | 153.7 | 153.7 | |||
Repurchase and retirement of common stock (in shares) | (0.9) | ||||
Repurchase and retirement of common stock | (198.1) | (198.1) | |||
Settlement of warrants (in shares) | 0.7 | ||||
Common stock, ending balance (in shares) at Oct. 31, 2019 | 97.6 | ||||
Ending balance at Oct. 31, 2019 | $ 1,516.4 | 2,477.5 | (0.6) | (960.5) | |
Common stock, beginning balance (in shares) at Jul. 31, 2020 | 96.3 | 96.3 | |||
Beginning balance at Jul. 31, 2020 | $ 1,101.8 | 2,259.2 | 10.5 | (1,167.9) | |
Increase (Decrease) in Stockholders' Equity | |||||
Net loss | (92.2) | (92.2) | |||
Other comprehensive income (loss) | (7.3) | (7.3) | |||
Issuance of common stock in connection with employee equity incentive plans (in shares) | 1 | ||||
Issuance of common stock in connection with employee equity incentive plans | 45.6 | 45.6 | |||
Taxes paid related to net share settlement of equity awards | (9.7) | (9.7) | |||
Share-based compensation for equity-based awards | $ 208.8 | 208.8 | |||
Repurchase and retirement of common stock (in shares) | (2.1) | (2.1) | |||
Repurchase and retirement of common stock | $ (500) | (500) | |||
Common stock, ending balance (in shares) at Oct. 31, 2020 | 95.2 | 95.2 | |||
Ending balance at Oct. 31, 2020 | $ 747 | $ 2,003.9 | $ 3.2 | $ (1,260.1) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 3 Months Ended | |
Oct. 31, 2020 | Oct. 31, 2019 | |
Cash flows from operating activities | ||
Net loss | $ (92.2) | $ (59.6) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Share-based compensation for equity-based awards | 205.8 | 149.9 |
Depreciation and amortization | 58 | 44 |
Amortization of deferred contract costs | 65.8 | 55.6 |
Amortization of debt discount and debt issuance costs | 35.1 | 15.5 |
Amortization of operating lease right-of-use assets | 10 | 10.4 |
Amortization of investment premiums, net of accretion of purchase discounts | 2.7 | (3.2) |
Changes in operating assets and liabilities, net of effects of acquisitions: | ||
Accounts receivable, net | 382.3 | 83.9 |
Prepaid expenses and other assets | (96.9) | (59.2) |
Accounts payable | (17.7) | (2.5) |
Accrued compensation | (134.8) | (109.9) |
Accrued and other liabilities | (20) | (25.2) |
Deferred revenue | 136.8 | 125.5 |
Net cash provided by operating activities | 534.9 | 225.2 |
Cash flows from investing activities | ||
Purchases of investments | (829.7) | (274.3) |
Proceeds from maturities of investments | 198.2 | 632.4 |
Business acquisitions, net of cash acquired | (225.1) | (66.4) |
Purchases of property, equipment, and other assets | (29.6) | (47.2) |
Net cash provided by (used in) investing activities | (886.2) | 244.5 |
Cash flows from financing activities | ||
Payments for debt issuance costs | (0.2) | 0 |
Repurchases of common stock | (500) | (198.1) |
Proceeds from sales of shares through employee equity incentive plans | 45.4 | 36.3 |
Payments for taxes related to net settlement of equity awards | (9.7) | (5.3) |
Net cash used in financing activities | (464.5) | (167.1) |
Net increase (decrease) in cash, cash equivalents, and restricted cash | (815.8) | 302.6 |
Cash, cash equivalents, and restricted cash - beginning of period | 2,961.7 | 965 |
Cash, cash equivalents, and restricted cash - end of period | $ 2,145.9 | $ 1,267.6 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS Reconciliation of cash, cash equivalents, and restricted cash to the consolidated balance sheets - USD ($) $ in Millions | Oct. 31, 2020 | Oct. 31, 2019 |
Reconciliation of cash, cash equivalents, and restricted cash | ||
Cash and cash equivalents | $ 2,142 | $ 1,263.7 |
Total cash, cash equivalents, and restricted cash | 2,145.9 | 1,267.6 |
Prepaid expenses and other current assets | ||
Reconciliation of cash, cash equivalents, and restricted cash | ||
Restricted cash | 2.9 | 1.9 |
Other assets | ||
Reconciliation of cash, cash equivalents, and restricted cash | ||
Restricted cash | $ 1 | $ 2 |
Description of Business, Basis
Description of Business, Basis of Presentation, Principles of Consolidation, and Summary of Significant Accounting Policies (Notes) | 3 Months Ended |
Oct. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business, Basis of Presentation, Principles of Consolidation, and Summary of Significant Accounting Policies | Description of Business and Summary of Significant Accounting Policies Description of Business Palo Alto Networks, Inc. (the “Company,” “we,” “us,” or “our”), located in Santa Clara, California, was incorporated in March 2005 under the laws of the State of Delaware and commenced operations in April 2005. We empower enterprises, service providers, and government entities to secure all users, applications, data, networks, and devices with comprehensive context at all times, across all locations. Basis of Presentation and Principles of Consolidation The accompanying condensed consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“GAAP”), consistent in all material respects with those applied in our Annual Report on Form 10-K for the fiscal year ended July 31, 2020, filed with the Securities and Exchange Commission (“SEC”) on September 4, 2020. Our condensed consolidated financial statements include our accounts and our wholly owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. Our condensed consolidated financial statements are unaudited, but include all adjustments of a normal recurring nature necessary for a fair presentation of our quarterly results. Our condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes in our Annual Report on Form 10-K for the fiscal year ended July 31, 2020. Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. We base our estimates on historical experience and also on assumptions that we believe are reasonable. Actual results could differ materially from those estimates due to risks and uncertainties, including uncertainty in the current economic environment due to COVID-19. Summary of Significant Accounting Policies There have been no material changes to our significant accounting policies as of and for the three months ended October 31, 2020, as compared to the significant accounting policies described in our Annual Report on Form 10-K for the fiscal year ended July 31, 2020, except for the change in our accounting policies for credit losses due to our adoption of the new credit losses guidance. Refer to “Recently Adopted Accounting Pronouncements” below. Recently Adopted Accounting Pronouncements Credit Losses In June 2016, the Financial Accounting Standards Board (“FASB”) issued new authoritative guidance on the accounting for credit losses on most financial assets and certain financial instruments. The standard replaces the incurred loss model with an expected credit loss model for financial assets measured at amortized cost, including trade accounts receivables and financing receivables. Credit losses on available-for-sale debt securities are required to be recorded through an allowance rather than as a write-down. We adopted this standard in our first quarter of fiscal 2021 using the modified-retrospective approach. The adoption of this standard did not have a material impact on our condensed consolidated financial statements. We updated the following accounting policies as a result of the adoption of this guidance. Cash, Cash Equivalents, and Investments We consider all highly liquid investments with original maturities of three months or less at the date of purchase to be cash equivalents. Investments not considered cash equivalents, and with maturities of one year or less from the condensed consolidated balance sheet date, are classified as short-term investments. Investments with maturities greater than one year from the condensed consolidated balance sheet date are classified as long-term investments. We classify our investments in marketable debt securities as available-for-sale at the time of purchase. When the fair value of a security is below its amortized cost, the amortized cost will be reduced to its fair value if it is more likely than not that we are required to sell the impaired security before recovery of its amortized cost basis, or we have the intention to sell the security. If neither of these conditions are met, we determine whether the impairment is due to credit losses by comparing the present value of the expected cash flows of the security with its amortized cost basis. The amount of impairment recognized is limited to the excess of the amortized cost over the fair value of the security. An allowance for credit losses for the excess of amortized cost over the expected cash flows is recorded in other income, net in our condensed consolidated statements of operations. Impairment losses that are not credit-related are included in accumulated other comprehensive income (loss) (“AOCI”) in stockholders’ equity. Accounts Receivable Trade accounts receivable are recorded at the invoiced amount, net of allowances for credit losses for any potential uncollectible amounts. The allowance for credit losses is based on our assessment of the collectability of accounts. Management regularly reviews the adequacy of the allowance for credit losses on a collective basis by considering the age of each outstanding invoice, each customer’s expected ability to pay and collection history, current market conditions, and reasonable and supportable forecasts of future economic conditions to determine whether the allowance is appropriate. Accounts receivable deemed uncollectible are charged against the allowance for credit losses when identified. For the three months ended October 31, 2020 and 2019, the allowance for credit losses activity was not significant. Financing Receivables We provide financing arrangements, primarily loans, for certain qualified end-user customers to purchase our products and services. Payment terms on these financing arrangements are generally up to three years. We evaluate our allowance for credit losses by assessing the risks and losses inherent in our financing receivables on either an individual or a collective basis. Our assessment considers various factors, including lifetime expected losses determined using customer risk profile, current economic conditions that may affect a customer’s ability to pay, and forward-looking economic considerations. Financing receivables are written off when they are considered uncollectible, and related outstanding balances are reversed and charged against the allowance for credit losses. Short-term financing receivables are included in prepaid expenses and other current assets, and long-term financing receivables are included in other assets on our condensed consolidated balance sheets. Refer to Note 5. Financing Receivables for additional information. Recently Issued Accounting Pronouncements Debt with Conversion Options In August 2020, the FASB issued new authoritative guidance to simplify the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts on an entity’s own equity. The standard reduces the number of models used to account for convertible instruments, and simplifies both the classification of debt on the balance sheet and the earnings per share calculation. The standard is effective for us in our first quarter of fiscal 2023 and will be applied on a modified retrospective basis. Early adoption is permitted from our first quarter of fiscal 2022. We are currently evaluating the impact of this standard on our condensed consolidated financial statements. |
Revenue (Notes)
Revenue (Notes) | 3 Months Ended |
Oct. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Revenue Disaggregation of Revenue The following table presents revenue by geographic theater (in millions): Three Months Ended October 31, 2020 2019 Revenue: Americas United States $ 628.4 $ 494.9 Other Americas 41.9 34.7 Total Americas 670.3 529.6 Europe, the Middle East, and Africa (“EMEA”) 170.9 147.6 Asia Pacific and Japan (“APAC”) 104.8 94.7 Total revenue $ 946.0 $ 771.9 The following table presents revenue for groups of similar products and services (in millions): Three Months Ended October 31, 2020 2019 Revenue: Product $ 237.3 $ 231.2 Subscription and support Subscription 428.0 318.6 Support 280.7 222.1 Total subscription and support 708.7 540.7 Total revenue $ 946.0 $ 771.9 Deferred Revenue During the three months ended October 31, 2020, we recognized approximately $630.0 million of revenue pertaining to amounts that were deferred as of July 31, 2020. Remaining Performance Obligations Revenue expected to be recognized from remaining performance obligations was $4.4 billion as of October 31, 2020, of which we expect to recognize approximately $2.3 billion over the next 12 months and the remainder thereafter. The following table presents details of our short-term and long-term deferred contract costs as of October 31, 2020 and July 31, 2020 (in millions): October 31, 2020 July 31, 2020 Short-term deferred contract costs $ 213.0 $ 206.0 Long-term deferred contract costs 408.8 422.3 Total deferred contract costs $ 621.8 $ 628.3 We recognized amortization expense for our deferred contract costs of $65.8 million and $55.6 million during the three months ended October 31, 2020 and 2019, respectively. We did not recognize any impairment losses on our deferred contract costs during the three months ended October 31, 2020 or 2019. |
Fair Value Measurements (Notes)
Fair Value Measurements (Notes) | 3 Months Ended |
Oct. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements We categorize assets and liabilities recorded or disclosed at fair value on our condensed consolidated balance sheets based upon the level of judgment associated with inputs used to measure their fair value. The categories are as follows: • Level 1—Inputs are unadjusted quoted prices in active markets for identical assets or liabilities. • Level 2—Inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the assets or liabilities, either directly or indirectly through market corroboration, for substantially the full term of the financial instruments. • Level 3—Inputs are unobservable inputs based on our own assumptions used to measure assets and liabilities at fair value. The inputs require significant management judgment or estimation. The following table presents the fair value of our financial assets and liabilities measured at fair value on a recurring basis using the above input categories as of October 31, 2020 and July 31, 2020 (in millions): October 31, 2020 July 31, 2020 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Cash equivalents: Money market funds $ 392.3 $ — $ — $ 392.3 $ 1,589.5 $ — $ — $ 1,589.5 Certificates of deposit — 150.0 — 150.0 — — — — U.S. government and agency securities — 407.6 — 407.6 — 342.0 — 342.0 Total cash equivalents 392.3 557.6 — 949.9 1,589.5 342.0 — 1,931.5 Short-term investments: Certificates of deposit — 31.1 — 31.1 — 26.9 — 26.9 Commercial paper — 10.0 — 10.0 — — — — Corporate debt securities — 169.1 — 169.1 — 100.2 — 100.2 U.S. government and agency securities — 827.3 — 827.3 — 645.6 — 645.6 Non-U.S. government and agency securities 38.1 38.1 17.1 17.1 Total short-term investments — 1,075.6 — 1,075.6 — 789.8 — 789.8 Long-term investments: Certificates of deposit — — — — — 5.0 — 5.0 Corporate debt securities — 162.9 — 162.9 — 91.7 — 91.7 U.S. government and agency securities — 667.2 — 667.2 — 447.4 — 447.4 Non-U.S. government and agency securities — 43.1 — 43.1 — 10.3 — 10.3 Total long-term investments — 873.2 — 873.2 — 554.4 — 554.4 Prepaid expenses and other current assets: Foreign currency forward contracts — 9.2 — 9.2 — 13.6 — 13.6 Total prepaid expenses and other current assets — 9.2 — 9.2 — 13.6 — 13.6 Other assets: Foreign currency forward contracts — — — — — 1.4 — 1.4 Total other assets: — — — — — 1.4 — 1.4 Total assets measured at fair value $ 392.3 $ 2,515.6 $ — $ 2,907.9 $ 1,589.5 $ 1,701.2 $ — $ 3,290.7 Refer to Note 10. Debt for the carrying amount and estimated fair value of our convertible senior notes as of October 31, 2020 and July 31, 2020. |
Cash Equivalents and Investment
Cash Equivalents and Investments (Notes) | 3 Months Ended |
Oct. 31, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Cash Equivalents and Investments | Cash Equivalents and Investments Available-for-sale Debt Securities The following tables summarize the amortized cost, unrealized gains and losses, and fair value of our available-for-sale debt securities as of October 31, 2020 and July 31, 2020 (in millions): October 31, 2020 Amortized Cost Unrealized Gains Unrealized Losses Fair Value Cash equivalents: Certificates of deposit $ 150.0 $ — $ — $ 150.0 U.S. government and agency securities 407.6 — — 407.6 Total available-for-sale cash equivalents $ 557.6 $ — $ — $ 557.6 Investments: Certificates of deposit $ 31.1 $ — $ — $ 31.1 Commercial paper 10.0 — — 10.0 Corporate debt securities 330.7 1.3 — 332.0 U.S. government and agency securities 1,492.6 2.0 (0.1) 1,494.5 Non-U.S. government securities 81.2 — — 81.2 Total available-for-sale investments $ 1,945.6 $ 3.3 $ (0.1) $ 1,948.8 July 31, 2020 Amortized Cost Unrealized Gains Unrealized Losses Fair Value Cash equivalents: U.S. government and agency securities $ 342.0 $ — $ — $ 342.0 Total available-for-sale cash equivalents $ 342.0 $ — $ — $ 342.0 Investments: Certificates of deposit $ 31.9 $ — $ — $ 31.9 Corporate debt securities 190.1 1.8 — 191.9 U.S. government and agency securities 1,090.3 2.8 (0.1) 1,093.0 Non-U.S. government and agency securities 27.4 — — 27.4 Total available-for-sale investments $ 1,339.7 $ 4.6 $ (0.1) $ 1,344.2 We do not intend to sell any of the securities in an unrealized loss position and it is not likely that we would be required to sell these securities before recovery of their amortized cost basis, which may be at maturity. We did not recognize any credit losses related to our available-for-sale debt securities during the three months ended October 31, 2020. The following table summarizes the amortized cost and fair value of our available-for-sale debt securities as of October 31, 2020, by contractual years-to-maturity (in millions): Amortized Cost Fair Value Due within one year $ 1,631.7 $ 1,633.2 Due between one and three years 871.5 873.2 Total $ 2,503.2 $ 2,506.4 Marketable Equity Securities Marketable equity securities consist of money market funds and are included in cash and cash equivalents on our condensed consolidated balance sheets. As of October 31, 2020 and July 31, 2020, the carrying value of our marketable equity securities were $392.3 million and $1.6 billion, respectively. There were no unrealized gains or losses recognized for these securities during the three months ended October 31, 2020 and 2019. |
Financing Receivables (Notes)
Financing Receivables (Notes) | 3 Months Ended |
Oct. 31, 2020 | |
Receivables [Abstract] | |
Financing Receivables | Financing Receivables We provide financing arrangements, primarily loans, for certain qualified end-user customers to purchase our products. The following table summarizes our short-term and long-term financing receivables as of October 31, 2020 (in millions): October 31, 2020 Short-term financing receivables, gross $ 11.2 Allowance for credit losses (0.2) Short-term financing receivables, net $ 11.0 Long-term financing receivables, gross $ 9.5 Allowance for credit losses (0.2) Long-term financing receivables, net $ 9.3 |
Derivative Instruments (Notes)
Derivative Instruments (Notes) | 3 Months Ended |
Oct. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments | Derivative Instruments As a global business, we are exposed to currency exchange rate risk. Substantially all of our revenue is transacted in U.S. dollars, however, a portion of our operating expenditures are incurred outside of the United States and are denominated in foreign currencies, making them subject to fluctuations in foreign currency exchange rates. We enter into foreign currency derivative contracts with maturities of 15 months or less, which we designate as cash flow hedges, to manage the foreign currency exchange rate risk associated with these expenditures. As of October 31, 2020 and July 31, 2020, the total notional amount of our outstanding foreign currency forward contracts was $386.7 million and $443.6 million, respectively. Refer to Note 3. Fair Value Measurements for the fair value of our derivative instruments as reported on our condensed consolidated balance sheets as of October 31, 2020. During the three months ended October 31, 2020 and 2019, both unrealized gains and losses recognized in AOCI related to our cash flow hedges and amounts reclassified into earnings were not material. Unrealized gains and losses in AOCI related to our cash flow hedges as of October 31, 2020 and 2019 were not material. |
Acquisition (Notes)
Acquisition (Notes) | 3 Months Ended |
Oct. 31, 2020 | |
Business Combinations [Abstract] | |
Acquisition | Acquisition The Crypsis Group On September 17, 2020, we completed our acquisition of The Crypsis Group (“Crypsis”), an incident response, risk management, and digital forensics consulting firm. We believe the acquisition will expand our capabilities and strengthen our Cortex strategy. The total purchase consideration for the acquisition of Crypsis was $227.7 million, which consisted of the following (in millions): Amount Cash $ 225.7 Fair value of replacement awards 2.0 Total $ 227.7 As part of the acquisition, we issued $27.1 million of replacement awards, of which the portion attributable to services performed prior to the acquisition date was allocated to purchase consideration. The remaining fair value was allocated to future services and will be expensed over the remaining service periods as share-based compensation. We have accounted for this transaction as a business combination and allocated the purchase consideration to assets acquired and liabilities assumed based on preliminary estimated fair values, as presented in the following table (in millions): Amount Goodwill $ 157.6 Identified intangible assets 54.4 Net assets acquired 15.7 Total $ 227.7 Goodwill generated from this business combination is primarily attributable to the assembled workforce and expected post-acquisition synergies from integrating Crypsis technology into our platforms. The goodwill is deductible for income tax purposes. The following table presents details of the identified intangible assets acquired (in millions, except years): Fair Value Estimated Useful Life Developed technology $ 6.9 3 years Customer relationships 47.5 7 years Total $ 54.4 Additional Acquisition-Related Information The operating results of the acquired company are included in our condensed consolidated statement of operations from the date of acquisition. Pro forma results of operations have not been presented because the effects of the acquisition were not material to our condensed consolidated statements of operations. Additional information related to the acquired company, such as that related to income tax and other contingencies, existing as of the acquisition date but unknown to us, may become known during the remainder of the measurement period, not to exceed 12 months from the acquisition date, which may result in changes to the amounts and allocations recorded. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Notes) | 3 Months Ended |
Oct. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill The following table presents details of our goodwill during the three months ended October 31, 2020 (in millions): Amount Balance as of July 31, 2020 $ 1,812.9 Goodwill acquired 157.6 Measurement period adjustment (1.9) Balance as of October 31, 2020 $ 1,968.6 Purchased Intangible Assets The following table presents details of our purchased intangible assets as of October 31, 2020 and July 31, 2020 (in millions): October 31, 2020 July 31, 2020 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Intangible assets subject to amortization: Developed technology $ 432.6 $ (166.6) $ 266.0 $ 425.9 $ (146.6) $ 279.3 Customer relationships 134.0 (14.6) 119.4 87.6 (12.4) 75.2 Acquired intellectual property 6.3 (3.3) 3.0 6.3 (3.2) 3.1 Trade name and trademarks 9.4 (9.4) — 9.4 (9.4) — Other 2.8 (2.4) 0.4 3.1 (2.5) 0.6 Total purchased intangible assets $ 585.1 $ (196.3) $ 388.8 $ 532.3 $ (174.1) $ 358.2 We recognized amortization expense of $23.6 million and $16.9 million for the three months ended October 31, 2020 and 2019, respectively. The following table summarizes estimated future amortization expense of our intangible assets as of October 31, 2020 (in millions): Amount Fiscal years ending July 31: Remaining 2021 $ 74.1 2022 94.3 2023 68.2 2024 58.2 2025 44.5 2026 and thereafter 49.5 Total future amortization expense $ 388.8 |
Deferred Contract Costs (Notes)
Deferred Contract Costs (Notes) | 3 Months Ended |
Oct. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Deferred Contract Costs | Revenue Disaggregation of Revenue The following table presents revenue by geographic theater (in millions): Three Months Ended October 31, 2020 2019 Revenue: Americas United States $ 628.4 $ 494.9 Other Americas 41.9 34.7 Total Americas 670.3 529.6 Europe, the Middle East, and Africa (“EMEA”) 170.9 147.6 Asia Pacific and Japan (“APAC”) 104.8 94.7 Total revenue $ 946.0 $ 771.9 The following table presents revenue for groups of similar products and services (in millions): Three Months Ended October 31, 2020 2019 Revenue: Product $ 237.3 $ 231.2 Subscription and support Subscription 428.0 318.6 Support 280.7 222.1 Total subscription and support 708.7 540.7 Total revenue $ 946.0 $ 771.9 Deferred Revenue During the three months ended October 31, 2020, we recognized approximately $630.0 million of revenue pertaining to amounts that were deferred as of July 31, 2020. Remaining Performance Obligations Revenue expected to be recognized from remaining performance obligations was $4.4 billion as of October 31, 2020, of which we expect to recognize approximately $2.3 billion over the next 12 months and the remainder thereafter. The following table presents details of our short-term and long-term deferred contract costs as of October 31, 2020 and July 31, 2020 (in millions): October 31, 2020 July 31, 2020 Short-term deferred contract costs $ 213.0 $ 206.0 Long-term deferred contract costs 408.8 422.3 Total deferred contract costs $ 621.8 $ 628.3 We recognized amortization expense for our deferred contract costs of $65.8 million and $55.6 million during the three months ended October 31, 2020 and 2019, respectively. We did not recognize any impairment losses on our deferred contract costs during the three months ended October 31, 2020 or 2019. |
Debt (Notes)
Debt (Notes) | 3 Months Ended |
Oct. 31, 2020 | |
Debt Disclosure [Abstract] | |
Debt | Debt Convertible Senior Notes In July 2018, we issued $1.7 billion aggregate principal amount of 0.75% Convertible Senior Notes due 2023 (the “2023 Notes”) and, in June 2020, we issued $2.0 billion aggregate principal amount of 0.375% Convertible Senior Notes due 2025 (the “2025 Notes,” and together with the 2023 Notes, the “Notes”). The 2023 Notes bear interest at a fixed rate of 0.75% per year, payable semi-annually in arrears on January 1 and July 1 of each year, beginning on January 1, 2019. The 2025 Notes bear interest at a fixed rate of 0.375% per year, payable semi-annually in arrears on June 1 and December 1 of each year, beginning on December 1, 2020. Each series of the convertible notes is governed by an indenture between us, as the issuer, and U.S. Bank National Association, as Trustee (individually, each an “Indenture,” and together, the “Indentures”). The Notes of each series are unsecured, unsubordinated obligations and the applicable Indenture governing each series of Notes does not contain any financial covenants or restrictions on the payments of dividends, the incurrence of indebtedness, or the issuance or repurchase of securities by us or any of our subsidiaries. The 2023 Notes and the 2025 Notes mature on July 1, 2023 and June 1, 2025, respectively. We cannot redeem the 2023 Notes prior to maturity. We may redeem for cash all or any portion of the 2025 Notes, at our option, on or after June 5, 2023, and prior to the 31st scheduled trading day immediately preceding the maturity date if the last reported sale price of our common stock has been at least 130% of the conversion price then in effect for at least 20 trading days during any 30 consecutive trading day period ending on and including the trading day preceding the date on which we provide notice of redemption. The redemption will be at a price equal to 100% of the principal amount of the 2025 Notes and adjusted for interest. If we call any or all of the 2025 Notes for redemption, holders may convert such 2025 Notes called for redemption at any time prior to the close of business on the second scheduled trading day immediately preceding the redemption date. The following table presents details of our Notes (number of shares in millions): Conversion Rate per $1,000 Principal Initial Conversion Price Convertible Date Initial Number of Shares 2023 Notes 3.7545 $ 266.35 April 1, 2023 6.4 2025 Notes 3.3602 $ 297.60 March 1, 2025 6.7 Holders of the Notes may surrender their Notes for conversion at their option at any time prior to the close of business on the business day immediately preceding their respective convertible dates only under the following circumstances: • during any fiscal quarter commencing after the fiscal quarters ending on October 31, 2018 and October 31, 2020 for the 2023 Notes and the 2025 Notes, respectively (and only during such fiscal quarter), if the last reported sale price of our common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding fiscal quarter is greater than or equal to 130% of the applicable conversion price for the respective Notes on each applicable trading day (the “sale price condition”); • during the five business day period after any five consecutive trading day period (the “measurement period”) in which the trading price per $1,000 principal amount of the applicable series of Notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of our common stock and the applicable conversion rate for the respective Notes on each such trading day; or • upon the occurrence of specified corporate events. On or after the respective convertible date, holders may surrender all or any portion of their Notes for conversion at any time prior to the close of business on the second scheduled trading day immediately preceding the applicable maturity date regardless of the foregoing conditions, and such conversions will be settled upon the applicable maturity date. Upon conversion, holders of the Notes of a series will receive cash equal to the aggregate principal amount of the Notes of such series to be converted, and, at our election, cash and/or shares of our common stock for any amounts in excess of the aggregate principal amount of the Notes of such series being converted. The conversion price will be subject to adjustment in some events. Holders of the Notes of a series who convert their Notes of such series in connection with certain corporate events that constitute a “make-whole fundamental change” under the applicable Indenture are, under certain circumstances, entitled to an increase in the conversion rate for such series of Notes. Additionally, upon the occurrence of a corporate event that constitutes a “fundamental change” under the applicable Indenture, holders of the Notes of such series may require us to repurchase for cash all or a portion of the Notes of such series at a repurchase price equal to 100% of the principal amount of the Notes of such series plus accrued and unpaid interest to, but excluding, the fundamental change repurchase date. The sale price condition was not met for the Notes during the fiscal quarters ended October 31, 2020 or July 31, 2020. Since the Notes were not convertible, the net carrying amount of the Notes was classified as a long-term liability and the equity component was included in additional paid-in capital in our condensed consolidated balance sheets in the periods presented. As of October 31, 2020, all of the Notes remained outstanding. The following table sets forth the components of the Notes as of October 31, 2020 and July 31, 2020 (in millions): October 31, 2020 July 31, 2020 2023 Notes 2025 Notes Total 2023 Notes 2025 Notes Total Liability component: Principal $ 1,693.0 $ 2,000.0 $ 3,693.0 $ 1,693.0 $ 2,000.0 $ 3,693.0 Less: debt discount and debt issuance costs, net of amortization 183.8 390.1 573.9 200.0 408.9 608.9 Net carrying amount $ 1,509.2 $ 1,609.9 $ 3,119.1 $ 1,493.0 $ 1,591.1 $ 3,084.1 Equity component $ 315.0 $ 403.0 $ 718.0 $ 315.0 $ 403.0 $ 718.0 The total estimated fair value of the Notes was $3.9 billion and $4.1 billion at October 31, 2020 and July 31, 2020, respectively. The fair value was determined based on the closing trading price per $100 of the Notes as of the last day of trading for the period. We consider the fair value of the Notes at October 31, 2020 and July 31, 2020 to be a Level 2 measurement. The fair value of the Notes is primarily affected by the trading price of our common stock and market interest rates. Based on the closing price of our common stock on October 31, 2020, the if-converted value of the Notes was less than its respective principal amount. The following table sets forth interest expense recognized related to the Notes (dollars in millions): Three Months Ended October 31, 2020 2019 2023 Notes 2025 Notes Total 2023 Notes Total Contractual interest expense $ 3.2 $ 1.9 $ 5.1 $ 3.2 $ 3.2 Amortization of debt discount 15.7 18.2 33.9 15.0 15.0 Amortization of debt issuance costs 0.5 0.7 1.2 0.5 0.5 Total interest expense recognized $ 19.4 $ 20.8 $ 40.2 $ 18.7 $ 18.7 Effective interest rate of the liability component 5.2 % 5.4 % 5.2 % Note Hedges To minimize the impact of potential economic dilution upon conversion of our Notes, we entered into separate convertible note hedge transactions (the “2023 Note Hedges,” with respect to the 2023 Notes, the “2025 Note Hedges,” with respect to the 2025 Notes, and the 2023 Notes Hedges together with 2025 Note Hedges, the “Note Hedges”) with respect to our common stock concurrent with the issuance of each series of the Notes. The following table presents details of our Note Hedges (in millions): Initial Number of Shares Aggregate Purchase 2023 Note Hedges 6.4 $ 332.0 2025 Note Hedges 6.7 $ 370.8 The Note Hedges cover shares of our common stock at a strike price per share that corresponds to the initial applicable conversion price of the applicable series of the Notes, which are also subject to adjustment, and are exercisable upon conversion of the applicable series of the Notes. The Note Hedges will expire upon maturity of the applicable series of the Notes. The Note Hedges are separate transactions and are not part of the terms of the applicable series of the Notes. Holders of the Notes of either series will not have any rights with respect to the Note Hedges. Any shares of our common stock receivable by us under the Note Hedges are excluded from the calculation of diluted earnings per share as they are antidilutive. The aggregate amounts paid for the Note Hedges are included in additional paid-in capital in our condensed consolidated balance sheets. Warrants Separately, but concurrently with the issuance of each series of our Notes, we entered into transactions whereby we sold warrants (the “2023 Warrants,” with respect to the 2023 Notes, the “2025 Warrants,” with respect to the 2025 Notes, and the 2023 Warrants together with the 2025 Warrants, the “Warrants”) to acquire shares of our common stock, subject to anti-dilution adjustments. The 2023 Warrants and 2025 Warrants are exercisable beginning October 2023 and September 2025, respectively. The following table presents details of the Warrants (in millions, except per share data): Initial Number Strike Price Aggregate 2023 Warrants 6.4 $ 417.80 $ 145.4 2025 Warrants 6.7 $ 408.47 $ 202.8 The shares issuable under the Warrants will be included in the calculation of diluted earnings per share when the average market value per share of our common stock for the reporting period exceeds the applicable strike price for such series of Warrants. The Warrants are separate transactions and are not part of either series of Notes or Note Hedges and are not remeasured through earnings each reporting period. Holders of the Notes of either series will not have any rights with respect to the Warrants. The aggregate proceeds received from the sale of the Warrants are included in additional paid-in capital in our condensed consolidated balance sheets. Revolving Credit Facility On September 4, 2018, we entered into a credit agreement (the “Credit Agreement”) with certain institutional lenders that provides for a $400.0 million unsecured revolving credit facility (the “Credit Facility”), with an option to increase the amount of the Credit Facility by up to an additional $350.0 million, subject to certain conditions. The Credit Facility matures on the earlier of (i) September 4, 2023 and (ii) the date that is 91 days prior to the stated maturity of our 2023 Notes if (a) any of the 2023 Notes are still outstanding and (b) our unrestricted cash and cash equivalents are less than the then outstanding principal amount of our 2023 Notes plus $400.0 million. The borrowings under the Credit Facility currently bear interest, at our option, at a base rate plus a spread of 0.00% to 0.75%, or an adjusted LIBO Rate plus a spread of 1.00% to 1.75%, in each case with such spread being determined based on our leverage ratio. We are obligated to pay an ongoing commitment fee on undrawn amounts at a rate of 0.125% to 0.250%, depending on our leverage ratio. Regulatory authorities that oversee financial markets have announced that after the end of 2021, they would no longer compel banks currently reporting information used to set the LIBO Rate to continue to make rate submissions. As a result, it is possible that beginning in 2022, the LIBO Rate will no longer be available as a reference rate. Under the terms of our Credit Facility, in the event of the discontinuance of the LIBO Rate, a mutually agreed-upon alternative benchmark rate will be established to replace the LIBO Rate, which may include the Secured Overnight Financing Rate (“SOFR”). We do not anticipate that the discontinuance of the LIBO Rate will materially impact our liquidity or financial position. As of October 31, 2020, there were no amounts outstanding and we were in compliance with all covenants under the Credit Agreement. |
Commitments and Contingencies (
Commitments and Contingencies (Notes) | 3 Months Ended |
Oct. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Purchase Commitments Manufacturing Purchase Commitments Our electronics manufacturing service provider (“EMS provider”) procures components and assembles our products based on our forecasts. These forecasts are based on estimates of demand for our products primarily for the next 12 months, which are in turn based on historical trends and an analysis from our sales and product management organizations, adjusted for overall market conditions. In order to reduce manufacturing lead times and plan for adequate supply, we may issue non-cancelable orders for products and components to our manufacturing partners or component suppliers. As of October 31, 2020, our purchase commitments under such orders were $140.8 million excluding obligations under contracts that we can cancel without a significant penalty. Other Purchase Commitments We have entered into various non-cancelable agreements with certain service providers, under which we are committed to minimum or fixed purchases through the year ending July 31, 2026. The following table presents details of the aggregate future non-cancelable purchase commitments under these agreements as of October 31, 2020 (in millions): Amount Fiscal years ending July 31: Remaining 2021 $ — 2022 159.2 2023 227.2 2024 285.7 2025 345.3 2026 and thereafter 551.1 Total other purchase commitments $ 1,568.5 Litigation We are subject to legal proceedings, claims, and litigation arising in the ordinary course of business, including intellectual property litigation. Such matters are subject to many uncertainties and outcomes are not predictable with assurance. We accrue for contingencies when we believe that a loss is probable and that we can reasonably estimate the amount of any such loss. To the extent there is a reasonable possibility that a loss exceeding amounts already recognized may be incurred and the amount of such additional loss would be material, we will either disclose the estimated additional loss or state that such an estimate cannot be made. As of October 31, 2020, we have not recorded any significant accruals for loss contingencies associated with such legal proceedings, determined that an unfavorable outcome is probable or reasonably possible, or determined that the amount or range of any possible loss is reasonably estimable. |
Stockholders' Equity (Notes)
Stockholders' Equity (Notes) | 3 Months Ended |
Oct. 31, 2020 | |
Equity [Abstract] | |
Stockholders’ Equity | Stockholders’ Equity Share Repurchase Program In February 2019, our board of directors authorized a $1.0 billion share repurchase program which is funded from available working capital. Repurchases may be made at management’s discretion from time to time on the open market, through privately negotiated transactions, transactions structured through investment banking institutions, block purchase techniques, 10b5-1 trading plans, or a combination of the foregoing. This repurchase authorization will expire on December 31, 2020 and may be suspended or discontinued at any time. During the three months ended October 31, 2020, we repurchased and retired 2.1 million shares of our common stock under the authorization for an aggregate purchase price of $500.0 million, including transaction costs. The total price of the shares repurchased and related transaction costs are reflected as a reduction to common stock and additional paid-in capital on our condensed consolidated balance sheets. As of October 31, 2020, $301.9 million remained available for future share repurchases under our current repurchase authorization. |
Equity Award Plans (Notes)
Equity Award Plans (Notes) | 3 Months Ended |
Oct. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Equity Award Plans | Equity Award Plans Assumed Share-based Compensation Plans The Crypsis Group Stock Incentive Plan In connection with our acquisition of Crypsis in September 2020, we assumed the Crypsis Group Holdings, LLC 2017 Equity Incentive Plan (the “Crypsis Group Plan”), under which the assumed Crypsis equity awards were granted. The assumed equity awards will be settled in shares of our common stock and will retain the terms and conditions under which they were originally granted; forfeited awards will not be returned to the Crypsis Group Plan. No additional equity awards will be granted under the Crypsis Group Plan. Refer to Note 7. Acquisition for more information on our Crypsis acquisition and the related equity awards assumed. Performance Stock Option (“PSO”) Activities There was no PSO activity under our stock plans during the three months ended October 31, 2020. As of October 31, 2020, we had 2.8 million shares of PSO outstanding and exercisable with a weighted-average exercise price per share of $194.14, a weighted-average remaining contract term of 4.9 years, and an aggregate intrinsic value of $74.8 million. Restricted Stock Unit (“RSU”) and Performance-Based Stock Unit (“PSU”) Activities The following table summarizes the RSU and PSU activity under our stock plans during the reporting period (in millions, except per share amounts): RSUs Outstanding PSUs Outstanding Number of Shares Weighted-Average Grant-Date Fair Value Per Share Aggregate Intrinsic Value Number of Shares Weighted-Average Grant-Date Fair Value Per Share Aggregate Intrinsic Value Balance—July 31, 2020 6.6 $ 203.30 $ 1,688.1 0.6 $ 231.42 $ 147.2 Granted 1.8 $ 241.67 0.4 $ 244.15 Vested (0.8) $ 187.16 (0.1) $ 210.57 Forfeited (0.2) $ 207.01 — $ 229.47 Balance—October 31, 2020 7.4 $ 213.78 $ 1,644.1 0.9 $ 238.35 $ 196.2 Our PSUs generally vest over a period of one Share-Based Compensation The following table summarizes share-based compensation included in costs and expenses (in millions): Three Months Ended October 31, 2020 2019 Cost of product revenue $ 1.5 $ 1.3 Cost of subscription and support revenue 22.2 18.9 Research and development 95.4 62.4 Sales and marketing 64.9 43.8 General and administrative 28.9 24.8 Total share-based compensation $ 212.9 $ 151.2 During the three months ended October 31, 2020, we accelerated the vesting of certain equity awards in connection with our acquisition; as a result, we recorded $7.1 million of share-based compensation within general and administrative expense in our condensed consolidated statements of operations. As of October 31, 2020, total compensation cost related to unvested share-based awards not yet recognized was $1.8 billion. This cost is expected to be amortized over a weighted-average period of approximately 2.7 years . Future grants will increase the amount of compensation expense to be recorded in these periods. |
Income Taxes (Notes)
Income Taxes (Notes) | 3 Months Ended |
Oct. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes For the three months ended October 31, 2020, our provision for income taxes reflects an effective tax rate of negative 12.0% . Our effective tax rate for the three months ended October 31, 2020 was negative as we recorded a provision for income taxes on year-to-date losses. The provision for income taxes for the three months ended October 31, 2020 was primarily due to income taxes in profitable foreign jurisdictions and withholding taxes. Our effective tax rate differs from the U.S. statutory tax rate primarily due to changes in our valuation allowance. Our provision for income taxes for the three months ended October 31, 2019 reflects an effective tax rate of negative 9.4%. Our effective tax rate for the three months ended October 31, 2019 was negative as we recorded a provision for income taxes on year-to-date losses. The provision for income taxes for the three months ended October 31, 2019 was primarily due to income taxes in profitable foreign jurisdictions, U.S. state taxes, and withholding taxes. Our effective tax rate differs from the U.S. statutory tax rate primarily due to deductibility of our share-based compensation, foreign income at other than U.S. tax rates, and changes in our valuation allowance. |
Net Loss Per Share (Notes)
Net Loss Per Share (Notes) | 3 Months Ended |
Oct. 31, 2020 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | Net Loss Per Share Basic net loss per share is computed by dividing net loss by basic weighted-average shares outstanding during the period. Diluted net loss per share is computed by dividing net loss by diluted weighted-average shares outstanding, including potentially dilutive securities. The following table presents the computation of basic and diluted net loss per share of common stock (in millions, except per share data): Three Months Ended October 31, 2020 2019 Net loss $ (92.2) $ (59.6) Weighted-average shares used to compute net loss per share, basic and diluted 95.5 96.6 Net loss per share, basic and diluted $ (0.97) $ (0.62) The following securities were excluded from the computation of diluted net loss per share of common stock for the periods presented as their effect would have been antidilutive (in millions): Three Months Ended October 31, 2020 2019 Convertible senior notes 13.1 6.4 Warrants related to the issuance of convertible senior notes 13.1 9.6 RSUs and PSUs 8.3 7.7 Options to purchase common stock, including PSOs 2.8 3.2 Restricted stock awards and performance-based stock awards — 0.1 ESPP shares 0.1 0.1 Total 37.4 27.1 |
Other Income, Net (Notes)
Other Income, Net (Notes) | 3 Months Ended |
Oct. 31, 2020 | |
Other Income and Expenses [Abstract] | |
Other Income, Net | Other Income, Net The following table sets forth the components of other income, net (in millions): Three Months Ended October 31, 2020 2019 Interest income $ 2.9 $ 15.8 Foreign currency exchange gains (losses), net 2.1 0.4 Other (2.6) — Total other income, net $ 2.4 $ 16.2 |
Subsequent Events (Notes)
Subsequent Events (Notes) | 3 Months Ended |
Oct. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Business Combinations In November 2020, we entered into a definitive agreement to acquire Expanse Inc. (“Expanse”), a privately-held company specializing in attack surface management, for total consideration of approximately $800 million, including approximately $670 million in cash and common stock, and approximately $130 million in replacement equity awards, subject to adjustment. We expect the acquisition will enrich our Cortex offerings and enable organizations an integrated view of the enterprise to combine external, internal, and threat data. The acquisition is expected to close during our second quarter of fiscal 2021. In November 2020, we entered into a definitive agreement to acquire Sinefa Group, Inc. and its wholly owned subsidiaries (“Sinefa”), a privately-held digital experience monitoring company, for total consideration of approximately $44 million in cash, subject to adjustment. We expect the acquisition will extend our Prisma Access offering. The acquisition is expected to close during our second quarter of fiscal 2021. |
Description of Business, Basi_2
Description of Business, Basis of Presentation, Principles of Consolidation, and Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Oct. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of accounting | Basis of Presentation and Principles of Consolidation The accompanying condensed consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“GAAP”), consistent in all material respects with those applied in our Annual Report on Form 10-K for the fiscal year ended July 31, 2020, filed with the Securities and Exchange Commission (“SEC”) on September 4, 2020. Our condensed consolidated financial statements include our accounts and our wholly owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. Our condensed consolidated financial statements are unaudited, but include all adjustments of a normal recurring nature necessary for a fair presentation of our quarterly results. Our condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes in our Annual Report on Form 10-K for the fiscal year ended July 31, 2020. |
Use of estimates | Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. We base our estimates on historical experience and also on assumptions that we believe are reasonable. Actual results could differ materially from those estimates due to risks and uncertainties, including uncertainty in the current economic environment due to COVID-19. |
Recent accounting pronouncements | Recently Adopted Accounting Pronouncements Credit Losses In June 2016, the Financial Accounting Standards Board (“FASB”) issued new authoritative guidance on the accounting for credit losses on most financial assets and certain financial instruments. The standard replaces the incurred loss model with an expected credit loss model for financial assets measured at amortized cost, including trade accounts receivables and financing receivables. Credit losses on available-for-sale debt securities are required to be recorded through an allowance rather than as a write-down. We adopted this standard in our first quarter of fiscal 2021 using the modified-retrospective approach. The adoption of this standard did not have a material impact on our condensed consolidated financial statements. We updated the following accounting policies as a result of the adoption of this guidance. Recently Issued Accounting Pronouncements Debt with Conversion Options In August 2020, the FASB issued new authoritative guidance to simplify the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts on an entity’s own equity. The standard reduces the number of models used to account for convertible instruments, and simplifies both the classification of debt on the balance sheet and the earnings per share calculation. The standard is effective for us in our first quarter of fiscal 2023 and will be applied on a modified retrospective basis. Early adoption is permitted from our first quarter of fiscal 2022. We are currently evaluating the impact of this standard on our condensed consolidated financial statements. |
Cash and cash equivalents | Cash, Cash Equivalents, and Investments We consider all highly liquid investments with original maturities of three months or less at the date of purchase to be cash equivalents. Investments not considered cash equivalents, and with maturities of one year or less from the condensed consolidated balance sheet date, are classified as short-term investments. Investments with maturities greater than one year from the condensed consolidated balance sheet date are classified as long-term investments. We classify our investments in marketable debt securities as available-for-sale at the time of purchase. When the fair value of a security is below its amortized cost, the amortized cost will be reduced to its fair value if it is more likely than not that we are required to sell the impaired security before recovery of its amortized cost basis, or we have the intention to sell the security. If neither of these conditions are met, we determine whether the impairment is due to credit losses by comparing the present value of the expected cash flows of the security with its amortized cost basis. The amount of impairment recognized is limited to the excess of the amortized cost over the fair value of the security. An allowance for credit losses for the excess of amortized cost over the expected cash flows is |
Investments | Cash, Cash Equivalents, and Investments We consider all highly liquid investments with original maturities of three months or less at the date of purchase to be cash equivalents. Investments not considered cash equivalents, and with maturities of one year or less from the condensed consolidated balance sheet date, are classified as short-term investments. Investments with maturities greater than one year from the condensed consolidated balance sheet date are classified as long-term investments. We classify our investments in marketable debt securities as available-for-sale at the time of purchase. When the fair value of a security is below its amortized cost, the amortized cost will be reduced to its fair value if it is more likely than not that we are required to sell the impaired security before recovery of its amortized cost basis, or we have the intention to sell the security. If neither of these conditions are met, we determine whether the impairment is due to credit losses by comparing the present value of the expected cash flows of the security with its amortized cost basis. The amount of impairment recognized is limited to the excess of the amortized cost over the fair value of the security. An allowance for credit losses for the excess of amortized cost over the expected cash flows is |
Accounts receivable | Accounts Receivable Trade accounts receivable are recorded at the invoiced amount, net of allowances for credit losses for any potential uncollectible amounts. The allowance for credit losses is based on our assessment of the collectability of accounts. Management regularly reviews the adequacy of the allowance for credit losses on a collective basis by considering the age of each outstanding invoice, each customer’s expected ability to pay and collection history, current market conditions, and reasonable and supportable forecasts of future economic conditions to determine whether the allowance is appropriate. Accounts receivable deemed uncollectible are charged against the allowance for credit losses when identified. For the three months ended October 31, 2020 and 2019, the allowance for credit losses activity was not significant. |
Financing receivables | Financing ReceivablesWe provide financing arrangements, primarily loans, for certain qualified end-user customers to purchase our products and services. Payment terms on these financing arrangements are generally up to three years. We evaluate our allowance for credit losses by assessing the risks and losses inherent in our financing receivables on either an individual or a collective basis. Our assessment considers various factors, including lifetime expected losses determined using customer risk profile, current economic conditions that may affect a customer’s ability to pay, and forward-looking economic considerations. Financing receivables are written off when they are considered uncollectible, and related outstanding balances are reversed and charged against the allowance for credit losses. Short-term financing receivables are included in prepaid expenses and other current assets, and long-term financing receivables are included in other assets on our condensed consolidated balance sheets. |
Fair value measurements | Fair Value Measurements We categorize assets and liabilities recorded or disclosed at fair value on our condensed consolidated balance sheets based upon the level of judgment associated with inputs used to measure their fair value. The categories are as follows: • Level 1—Inputs are unadjusted quoted prices in active markets for identical assets or liabilities. • Level 2—Inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the assets or liabilities, either directly or indirectly through market corroboration, for substantially the full term of the financial instruments. • Level 3—Inputs are unobservable inputs based on our own assumptions used to measure assets and liabilities at fair value. The inputs require significant management judgment or estimation. |
Share-based compensation, PSUs | Our PSUs generally vest over a period of one |
Revenue (Tables)
Revenue (Tables) | 3 Months Ended |
Oct. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from external customers by geographic areas | The following table presents revenue by geographic theater (in millions): Three Months Ended October 31, 2020 2019 Revenue: Americas United States $ 628.4 $ 494.9 Other Americas 41.9 34.7 Total Americas 670.3 529.6 Europe, the Middle East, and Africa (“EMEA”) 170.9 147.6 Asia Pacific and Japan (“APAC”) 104.8 94.7 Total revenue $ 946.0 $ 771.9 |
Revenue from external customers by products and services | The following table presents revenue for groups of similar products and services (in millions): Three Months Ended October 31, 2020 2019 Revenue: Product $ 237.3 $ 231.2 Subscription and support Subscription 428.0 318.6 Support 280.7 222.1 Total subscription and support 708.7 540.7 Total revenue $ 946.0 $ 771.9 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Oct. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of fair value of financial assets and liabilities | The following table presents the fair value of our financial assets and liabilities measured at fair value on a recurring basis using the above input categories as of October 31, 2020 and July 31, 2020 (in millions): October 31, 2020 July 31, 2020 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Cash equivalents: Money market funds $ 392.3 $ — $ — $ 392.3 $ 1,589.5 $ — $ — $ 1,589.5 Certificates of deposit — 150.0 — 150.0 — — — — U.S. government and agency securities — 407.6 — 407.6 — 342.0 — 342.0 Total cash equivalents 392.3 557.6 — 949.9 1,589.5 342.0 — 1,931.5 Short-term investments: Certificates of deposit — 31.1 — 31.1 — 26.9 — 26.9 Commercial paper — 10.0 — 10.0 — — — — Corporate debt securities — 169.1 — 169.1 — 100.2 — 100.2 U.S. government and agency securities — 827.3 — 827.3 — 645.6 — 645.6 Non-U.S. government and agency securities 38.1 38.1 17.1 17.1 Total short-term investments — 1,075.6 — 1,075.6 — 789.8 — 789.8 Long-term investments: Certificates of deposit — — — — — 5.0 — 5.0 Corporate debt securities — 162.9 — 162.9 — 91.7 — 91.7 U.S. government and agency securities — 667.2 — 667.2 — 447.4 — 447.4 Non-U.S. government and agency securities — 43.1 — 43.1 — 10.3 — 10.3 Total long-term investments — 873.2 — 873.2 — 554.4 — 554.4 Prepaid expenses and other current assets: Foreign currency forward contracts — 9.2 — 9.2 — 13.6 — 13.6 Total prepaid expenses and other current assets — 9.2 — 9.2 — 13.6 — 13.6 Other assets: Foreign currency forward contracts — — — — — 1.4 — 1.4 Total other assets: — — — — — 1.4 — 1.4 Total assets measured at fair value $ 392.3 $ 2,515.6 $ — $ 2,907.9 $ 1,589.5 $ 1,701.2 $ — $ 3,290.7 |
Cash Equivalents and Investme_2
Cash Equivalents and Investments (Tables) | 3 Months Ended |
Oct. 31, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of available-for-sale securities | The following tables summarize the amortized cost, unrealized gains and losses, and fair value of our available-for-sale debt securities as of October 31, 2020 and July 31, 2020 (in millions): October 31, 2020 Amortized Cost Unrealized Gains Unrealized Losses Fair Value Cash equivalents: Certificates of deposit $ 150.0 $ — $ — $ 150.0 U.S. government and agency securities 407.6 — — 407.6 Total available-for-sale cash equivalents $ 557.6 $ — $ — $ 557.6 Investments: Certificates of deposit $ 31.1 $ — $ — $ 31.1 Commercial paper 10.0 — — 10.0 Corporate debt securities 330.7 1.3 — 332.0 U.S. government and agency securities 1,492.6 2.0 (0.1) 1,494.5 Non-U.S. government securities 81.2 — — 81.2 Total available-for-sale investments $ 1,945.6 $ 3.3 $ (0.1) $ 1,948.8 July 31, 2020 Amortized Cost Unrealized Gains Unrealized Losses Fair Value Cash equivalents: U.S. government and agency securities $ 342.0 $ — $ — $ 342.0 Total available-for-sale cash equivalents $ 342.0 $ — $ — $ 342.0 Investments: Certificates of deposit $ 31.9 $ — $ — $ 31.9 Corporate debt securities 190.1 1.8 — 191.9 U.S. government and agency securities 1,090.3 2.8 (0.1) 1,093.0 Non-U.S. government and agency securities 27.4 — — 27.4 Total available-for-sale investments $ 1,339.7 $ 4.6 $ (0.1) $ 1,344.2 |
Schedule of contractual maturities of available-for-sale securities | The following table summarizes the amortized cost and fair value of our available-for-sale debt securities as of October 31, 2020, by contractual years-to-maturity (in millions): Amortized Cost Fair Value Due within one year $ 1,631.7 $ 1,633.2 Due between one and three years 871.5 873.2 Total $ 2,503.2 $ 2,506.4 |
Financing Receivables (Tables)
Financing Receivables (Tables) | 3 Months Ended |
Oct. 31, 2020 | |
Receivables [Abstract] | |
Short- and long-term financing receivables | The following table summarizes our short-term and long-term financing receivables as of October 31, 2020 (in millions): October 31, 2020 Short-term financing receivables, gross $ 11.2 Allowance for credit losses (0.2) Short-term financing receivables, net $ 11.0 Long-term financing receivables, gross $ 9.5 Allowance for credit losses (0.2) Long-term financing receivables, net $ 9.3 |
Acquisition (Tables)
Acquisition (Tables) - The Crypsis Group | 3 Months Ended |
Oct. 31, 2020 | |
Business Acquisition | |
Schedule of purchase consideration | The total purchase consideration for the acquisition of Crypsis was $227.7 million, which consisted of the following (in millions): Amount Cash $ 225.7 Fair value of replacement awards 2.0 Total $ 227.7 |
Schedule of recognized identified assets acquired and liabilities assumed | We have accounted for this transaction as a business combination and allocated the purchase consideration to assets acquired and liabilities assumed based on preliminary estimated fair values, as presented in the following table (in millions): Amount Goodwill $ 157.6 Identified intangible assets 54.4 Net assets acquired 15.7 Total $ 227.7 |
Schedule of finite-lived intangible assets acquired as part of business combination | The following table presents details of the identified intangible assets acquired (in millions, except years): Fair Value Estimated Useful Life Developed technology $ 6.9 3 years Customer relationships 47.5 7 years Total $ 54.4 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets (Tables) | 3 Months Ended |
Oct. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of goodwill | The following table presents details of our goodwill during the three months ended October 31, 2020 (in millions): Amount Balance as of July 31, 2020 $ 1,812.9 Goodwill acquired 157.6 Measurement period adjustment (1.9) Balance as of October 31, 2020 $ 1,968.6 |
Schedule of purchased finite-lived intangible assets by major class | The following table presents details of our purchased intangible assets as of October 31, 2020 and July 31, 2020 (in millions): October 31, 2020 July 31, 2020 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Intangible assets subject to amortization: Developed technology $ 432.6 $ (166.6) $ 266.0 $ 425.9 $ (146.6) $ 279.3 Customer relationships 134.0 (14.6) 119.4 87.6 (12.4) 75.2 Acquired intellectual property 6.3 (3.3) 3.0 6.3 (3.2) 3.1 Trade name and trademarks 9.4 (9.4) — 9.4 (9.4) — Other 2.8 (2.4) 0.4 3.1 (2.5) 0.6 Total purchased intangible assets $ 585.1 $ (196.3) $ 388.8 $ 532.3 $ (174.1) $ 358.2 |
Future amortization expense of intangible assets | The following table summarizes estimated future amortization expense of our intangible assets as of October 31, 2020 (in millions): Amount Fiscal years ending July 31: Remaining 2021 $ 74.1 2022 94.3 2023 68.2 2024 58.2 2025 44.5 2026 and thereafter 49.5 Total future amortization expense $ 388.8 |
Deferred Contract Costs (Tables
Deferred Contract Costs (Tables) | 3 Months Ended |
Oct. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of deferred contract costs | The following table presents details of our short-term and long-term deferred contract costs as of October 31, 2020 and July 31, 2020 (in millions): October 31, 2020 July 31, 2020 Short-term deferred contract costs $ 213.0 $ 206.0 Long-term deferred contract costs 408.8 422.3 Total deferred contract costs $ 621.8 $ 628.3 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Oct. 31, 2020 | |
Debt Disclosure [Abstract] | |
Convertible debt, other details | The following table presents details of our Notes (number of shares in millions): Conversion Rate per $1,000 Principal Initial Conversion Price Convertible Date Initial Number of Shares 2023 Notes 3.7545 $ 266.35 April 1, 2023 6.4 2025 Notes 3.3602 $ 297.60 March 1, 2025 6.7 |
Components of convertible senior notes | The following table sets forth the components of the Notes as of October 31, 2020 and July 31, 2020 (in millions): October 31, 2020 July 31, 2020 2023 Notes 2025 Notes Total 2023 Notes 2025 Notes Total Liability component: Principal $ 1,693.0 $ 2,000.0 $ 3,693.0 $ 1,693.0 $ 2,000.0 $ 3,693.0 Less: debt discount and debt issuance costs, net of amortization 183.8 390.1 573.9 200.0 408.9 608.9 Net carrying amount $ 1,509.2 $ 1,609.9 $ 3,119.1 $ 1,493.0 $ 1,591.1 $ 3,084.1 Equity component $ 315.0 $ 403.0 $ 718.0 $ 315.0 $ 403.0 $ 718.0 |
Interest expense recognized related to the convertible senior notes | The following table sets forth interest expense recognized related to the Notes (dollars in millions): Three Months Ended October 31, 2020 2019 2023 Notes 2025 Notes Total 2023 Notes Total Contractual interest expense $ 3.2 $ 1.9 $ 5.1 $ 3.2 $ 3.2 Amortization of debt discount 15.7 18.2 33.9 15.0 15.0 Amortization of debt issuance costs 0.5 0.7 1.2 0.5 0.5 Total interest expense recognized $ 19.4 $ 20.8 $ 40.2 $ 18.7 $ 18.7 Effective interest rate of the liability component 5.2 % 5.4 % 5.2 % |
Schedule of note hedge transactions | The following table presents details of our Note Hedges (in millions): Initial Number of Shares Aggregate Purchase 2023 Note Hedges 6.4 $ 332.0 2025 Note Hedges 6.7 $ 370.8 |
Warrants details | The following table presents details of the Warrants (in millions, except per share data): Initial Number Strike Price Aggregate 2023 Warrants 6.4 $ 417.80 $ 145.4 2025 Warrants 6.7 $ 408.47 $ 202.8 |
Commitments and Contingencies_2
Commitments and Contingencies (Tables) | 3 Months Ended |
Oct. 31, 2020 | |
Cloud and other services | |
Unrecorded Unconditional Purchase Obligation | |
Schedule of future non-cancelable purchase commitments for cloud services | The following table presents details of the aggregate future non-cancelable purchase commitments under these agreements as of October 31, 2020 (in millions): Amount Fiscal years ending July 31: Remaining 2021 $ — 2022 159.2 2023 227.2 2024 285.7 2025 345.3 2026 and thereafter 551.1 Total other purchase commitments $ 1,568.5 |
Equity Award Plans (Tables)
Equity Award Plans (Tables) | 3 Months Ended |
Oct. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of restricted stock unit (“RSU”) and performance-based stock unit (“PSU”) activities | The following table summarizes the RSU and PSU activity under our stock plans during the reporting period (in millions, except per share amounts): RSUs Outstanding PSUs Outstanding Number of Shares Weighted-Average Grant-Date Fair Value Per Share Aggregate Intrinsic Value Number of Shares Weighted-Average Grant-Date Fair Value Per Share Aggregate Intrinsic Value Balance—July 31, 2020 6.6 $ 203.30 $ 1,688.1 0.6 $ 231.42 $ 147.2 Granted 1.8 $ 241.67 0.4 $ 244.15 Vested (0.8) $ 187.16 (0.1) $ 210.57 Forfeited (0.2) $ 207.01 — $ 229.47 Balance—October 31, 2020 7.4 $ 213.78 $ 1,644.1 0.9 $ 238.35 $ 196.2 |
Schedule of allocation of share-based compensation expense | The following table summarizes share-based compensation included in costs and expenses (in millions): Three Months Ended October 31, 2020 2019 Cost of product revenue $ 1.5 $ 1.3 Cost of subscription and support revenue 22.2 18.9 Research and development 95.4 62.4 Sales and marketing 64.9 43.8 General and administrative 28.9 24.8 Total share-based compensation $ 212.9 $ 151.2 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 3 Months Ended |
Oct. 31, 2020 | |
Earnings Per Share [Abstract] | |
Computation of basic and diluted net loss per share of common stock | The following table presents the computation of basic and diluted net loss per share of common stock (in millions, except per share data): Three Months Ended October 31, 2020 2019 Net loss $ (92.2) $ (59.6) Weighted-average shares used to compute net loss per share, basic and diluted 95.5 96.6 Net loss per share, basic and diluted $ (0.97) $ (0.62) |
Schedule of antidilutive securities excluded from the computation of net loss per share | The following securities were excluded from the computation of diluted net loss per share of common stock for the periods presented as their effect would have been antidilutive (in millions): Three Months Ended October 31, 2020 2019 Convertible senior notes 13.1 6.4 Warrants related to the issuance of convertible senior notes 13.1 9.6 RSUs and PSUs 8.3 7.7 Options to purchase common stock, including PSOs 2.8 3.2 Restricted stock awards and performance-based stock awards — 0.1 ESPP shares 0.1 0.1 Total 37.4 27.1 |
Other Income, Net (Tables)
Other Income, Net (Tables) | 3 Months Ended |
Oct. 31, 2020 | |
Other Income and Expenses [Abstract] | |
Schedule of components of other income, net | The following table sets forth the components of other income, net (in millions): Three Months Ended October 31, 2020 2019 Interest income $ 2.9 $ 15.8 Foreign currency exchange gains (losses), net 2.1 0.4 Other (2.6) — Total other income, net $ 2.4 $ 16.2 |
Description of Business, Basi_3
Description of Business, Basis of Presentation, Principles of Consolidation, and Summary of Significant Accounting Policies (Details) | 3 Months Ended |
Oct. 31, 2020 | |
Maximum | |
Financing Receivables | |
Financing receivable payment terms | 3 years |
Revenue (Disaggregation of Reve
Revenue (Disaggregation of Revenue - Geographic Theater) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Oct. 31, 2020 | Oct. 31, 2019 | |
Disaggregation of Revenue | ||
Revenue: | $ 946 | $ 771.9 |
United States | ||
Disaggregation of Revenue | ||
Revenue: | 628.4 | 494.9 |
Other Americas | ||
Disaggregation of Revenue | ||
Revenue: | 41.9 | 34.7 |
Total Americas | ||
Disaggregation of Revenue | ||
Revenue: | 670.3 | 529.6 |
Europe, the Middle East, and Africa (“EMEA”) | ||
Disaggregation of Revenue | ||
Revenue: | 170.9 | 147.6 |
Asia Pacific and Japan (“APAC”) | ||
Disaggregation of Revenue | ||
Revenue: | $ 104.8 | $ 94.7 |
Revenue (Disaggregation of Re_2
Revenue (Disaggregation of Revenue - Type of Revenue) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Oct. 31, 2020 | Oct. 31, 2019 | |
Revenue: | ||
Revenue: | $ 946 | $ 771.9 |
Product | ||
Revenue: | ||
Revenue: | 237.3 | 231.2 |
Subscription | ||
Revenue: | ||
Revenue: | 428 | 318.6 |
Support | ||
Revenue: | ||
Revenue: | 280.7 | 222.1 |
Total subscription and support | ||
Revenue: | ||
Revenue: | $ 708.7 | $ 540.7 |
Revenue (Deferred Revenue) (Det
Revenue (Deferred Revenue) (Details) $ in Millions | 3 Months Ended |
Oct. 31, 2020USD ($) | |
Revenue from Contract with Customer [Abstract] | |
Contract with customer, liability, revenue recognized | $ 630 |
Revenue (Remaining Performance
Revenue (Remaining Performance Obligations) (Details) $ in Billions | Oct. 31, 2020USD ($) |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligations | $ 4.4 |
Remaining Performance Obligations, Expected Timing of Satisfaction, Start Date: 2020-11-01 | |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligations | $ 2.3 |
Remaining Performance Obligations, Expected Timing of Satisfaction | |
Remaining performance obligations, expected timing of satisfaction, period | 12 months |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - Fair value, measurements, recurring - USD ($) $ in Millions | Oct. 31, 2020 | Jul. 31, 2020 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Cash equivalents: | $ 949.9 | $ 1,931.5 |
Short-term investments: | 1,075.6 | 789.8 |
Long-term investments: | 873.2 | 554.4 |
Prepaid expenses and other current assets: | 9.2 | 13.6 |
Other assets: | 0 | 1.4 |
Total assets measured at fair value | 2,907.9 | 3,290.7 |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Cash equivalents: | 392.3 | 1,589.5 |
Short-term investments: | 0 | 0 |
Long-term investments: | 0 | 0 |
Prepaid expenses and other current assets: | 0 | 0 |
Other assets: | 0 | 0 |
Total assets measured at fair value | 392.3 | 1,589.5 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Cash equivalents: | 557.6 | 342 |
Short-term investments: | 1,075.6 | 789.8 |
Long-term investments: | 873.2 | 554.4 |
Prepaid expenses and other current assets: | 9.2 | 13.6 |
Other assets: | 0 | 1.4 |
Total assets measured at fair value | 2,515.6 | 1,701.2 |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Cash equivalents: | 0 | 0 |
Short-term investments: | 0 | 0 |
Long-term investments: | 0 | 0 |
Prepaid expenses and other current assets: | 0 | 0 |
Other assets: | 0 | 0 |
Total assets measured at fair value | 0 | 0 |
Money market funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Cash equivalents: | 392.3 | 1,589.5 |
Money market funds | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Cash equivalents: | 392.3 | 1,589.5 |
Money market funds | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Cash equivalents: | 0 | 0 |
Money market funds | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Cash equivalents: | 0 | 0 |
Certificates of deposit | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Cash equivalents: | 150 | 0 |
Short-term investments: | 31.1 | 26.9 |
Long-term investments: | 0 | 5 |
Certificates of deposit | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Cash equivalents: | 0 | 0 |
Short-term investments: | 0 | 0 |
Long-term investments: | 0 | 0 |
Certificates of deposit | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Cash equivalents: | 150 | 0 |
Short-term investments: | 31.1 | 26.9 |
Long-term investments: | 0 | 5 |
Certificates of deposit | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Cash equivalents: | 0 | 0 |
Short-term investments: | 0 | 0 |
Long-term investments: | 0 | 0 |
Commercial paper | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Short-term investments: | 10 | 0 |
Commercial paper | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Short-term investments: | 0 | 0 |
Commercial paper | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Short-term investments: | 10 | 0 |
Commercial paper | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Short-term investments: | 0 | 0 |
Corporate debt securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Short-term investments: | 169.1 | 100.2 |
Long-term investments: | 162.9 | 91.7 |
Corporate debt securities | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Short-term investments: | 0 | 0 |
Long-term investments: | 0 | 0 |
Corporate debt securities | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Short-term investments: | 169.1 | 100.2 |
Long-term investments: | 162.9 | 91.7 |
Corporate debt securities | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Short-term investments: | 0 | 0 |
Long-term investments: | 0 | 0 |
U.S. government and agency securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Cash equivalents: | 407.6 | 342 |
Short-term investments: | 827.3 | 645.6 |
Long-term investments: | 667.2 | 447.4 |
U.S. government and agency securities | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Cash equivalents: | 0 | 0 |
Short-term investments: | 0 | 0 |
Long-term investments: | 0 | 0 |
U.S. government and agency securities | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Cash equivalents: | 407.6 | 342 |
Short-term investments: | 827.3 | 645.6 |
Long-term investments: | 667.2 | 447.4 |
U.S. government and agency securities | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Cash equivalents: | 0 | 0 |
Short-term investments: | 0 | 0 |
Long-term investments: | 0 | 0 |
Non-U.S. government and agency securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Short-term investments: | 38.1 | 17.1 |
Long-term investments: | 43.1 | 10.3 |
Non-U.S. government and agency securities | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Short-term investments: | ||
Long-term investments: | 0 | 0 |
Non-U.S. government and agency securities | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Short-term investments: | 38.1 | 17.1 |
Long-term investments: | 43.1 | 10.3 |
Non-U.S. government and agency securities | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Short-term investments: | ||
Long-term investments: | 0 | 0 |
Foreign currency forward contracts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Prepaid expenses and other current assets: | 9.2 | 13.6 |
Other assets: | 0 | 1.4 |
Foreign currency forward contracts | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Prepaid expenses and other current assets: | 0 | 0 |
Other assets: | 0 | 0 |
Foreign currency forward contracts | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Prepaid expenses and other current assets: | 9.2 | 13.6 |
Other assets: | 0 | 1.4 |
Foreign currency forward contracts | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||
Prepaid expenses and other current assets: | 0 | 0 |
Other assets: | $ 0 | $ 0 |
Cash Equivalents and Investme_3
Cash Equivalents and Investments (Available-for-Sale Securities) (Details) - USD ($) $ in Millions | Oct. 31, 2020 | Jul. 31, 2020 |
Debt Securities, Available-for-sale | ||
Amortized Cost | $ 2,503.2 | |
Fair Value | 2,506.4 | |
Cash equivalents: | ||
Debt Securities, Available-for-sale | ||
Amortized Cost | 557.6 | $ 342 |
Unrealized Gains | 0 | 0 |
Unrealized Losses | 0 | 0 |
Fair Value | 557.6 | 342 |
Cash equivalents: | Certificates of deposit | ||
Debt Securities, Available-for-sale | ||
Amortized Cost | 150 | |
Unrealized Gains | 0 | |
Unrealized Losses | 0 | |
Fair Value | 150 | |
Cash equivalents: | U.S. government and agency securities | ||
Debt Securities, Available-for-sale | ||
Amortized Cost | 407.6 | 342 |
Unrealized Gains | 0 | 0 |
Unrealized Losses | 0 | 0 |
Fair Value | 407.6 | 342 |
Investments: | ||
Debt Securities, Available-for-sale | ||
Amortized Cost | 1,945.6 | 1,339.7 |
Unrealized Gains | 3.3 | 4.6 |
Unrealized Losses | (0.1) | (0.1) |
Fair Value | 1,948.8 | 1,344.2 |
Investments: | Certificates of deposit | ||
Debt Securities, Available-for-sale | ||
Amortized Cost | 31.1 | 31.9 |
Unrealized Gains | 0 | 0 |
Unrealized Losses | 0 | 0 |
Fair Value | 31.1 | 31.9 |
Investments: | Commercial paper | ||
Debt Securities, Available-for-sale | ||
Amortized Cost | 10 | |
Unrealized Gains | 0 | |
Unrealized Losses | 0 | |
Fair Value | 10 | |
Investments: | Corporate debt securities | ||
Debt Securities, Available-for-sale | ||
Amortized Cost | 330.7 | 190.1 |
Unrealized Gains | 1.3 | 1.8 |
Unrealized Losses | 0 | 0 |
Fair Value | 332 | 191.9 |
Investments: | U.S. government and agency securities | ||
Debt Securities, Available-for-sale | ||
Amortized Cost | 1,492.6 | 1,090.3 |
Unrealized Gains | 2 | 2.8 |
Unrealized Losses | (0.1) | (0.1) |
Fair Value | 1,494.5 | 1,093 |
Investments: | Non-U.S. government and agency securities | ||
Debt Securities, Available-for-sale | ||
Amortized Cost | 81.2 | 27.4 |
Unrealized Gains | 0 | 0 |
Unrealized Losses | 0 | 0 |
Fair Value | $ 81.2 | $ 27.4 |
Cash Equivalents and Investme_4
Cash Equivalents and Investments (Available-for-Sale Securities, Contractual Maturities) (Details) $ in Millions | Oct. 31, 2020USD ($) |
Amortized Cost | |
Due within one year | $ 1,631.7 |
Due between one and three years | 871.5 |
Amortized Cost | 2,503.2 |
Fair Value | |
Due within one year | 1,633.2 |
Due between one and three years | 873.2 |
Fair Value | $ 2,506.4 |
Cash Equivalents and Investme_5
Cash Equivalents and Investments (Marketable Equity Securities) (Details) - USD ($) $ in Millions | Oct. 31, 2020 | Jul. 31, 2020 |
Cash and cash equivalents | Marketable equity securities | Money market funds | ||
Marketable Equity Securities | ||
Marketable equity securities | $ 392.3 | $ 1,600 |
Financing Receivables (Details)
Financing Receivables (Details) $ in Millions | Oct. 31, 2020USD ($) |
Receivables [Abstract] | |
Short-term financing receivables, gross | $ 11.2 |
Allowance for credit losses | (0.2) |
Short-term financing receivables, net | 11 |
Long-term financing receivables, gross | 9.5 |
Allowance for credit losses | (0.2) |
Long-term financing receivables, net | $ 9.3 |
Derivative Instruments (Details
Derivative Instruments (Details) - USD ($) $ in Millions | 3 Months Ended | |
Oct. 31, 2020 | Jul. 31, 2020 | |
Derivative | ||
Notional amount | $ 386.7 | $ 443.6 |
Foreign Exchange Contract | ||
Derivative | ||
Maximum contract term of cash flow hedge | 15 months |
Acquisition (Additional Informa
Acquisition (Additional Information) (Details) - The Crypsis Group $ in Millions | Sep. 17, 2020USD ($) |
Business Acquisition | |
Total purchase consideration | $ 227.7 |
Total fair value of replacement equity awards | $ 27.1 |
Acquisition (Purchase Price All
Acquisition (Purchase Price Allocation) (Details) - USD ($) $ in Millions | Sep. 17, 2020 | Oct. 31, 2020 | Jul. 31, 2020 |
Business Acquisition | |||
Goodwill | $ 1,968.6 | $ 1,812.9 | |
The Crypsis Group | |||
Business Acquisition | |||
Cash | $ 225.7 | ||
Fair value of replacement awards | 2 | ||
Total | 227.7 | ||
Goodwill | 157.6 | ||
Identified intangible assets | 54.4 | ||
Net assets acquired | 15.7 | ||
Total | $ 227.7 |
Acquisition (Intangible assets
Acquisition (Intangible assets acquired as part of business combination) (Details) - The Crypsis Group $ in Millions | Sep. 17, 2020USD ($) |
Finite-Lived Intangible Assets | |
Fair value | $ 54.4 |
Developed technology | |
Finite-Lived Intangible Assets | |
Fair value | $ 6.9 |
Estimated useful life | 3 years |
Customer relationships | |
Finite-Lived Intangible Assets | |
Fair value | $ 47.5 |
Estimated useful life | 7 years |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets (Goodwill) (Details) $ in Millions | 3 Months Ended |
Oct. 31, 2020USD ($) | |
Goodwill Rollforward | |
Balance as of July 31, 2020 | $ 1,812.9 |
Goodwill acquired | 157.6 |
Measurement period adjustment | (1.9) |
Balance as of October 31, 2020 | $ 1,968.6 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets (Purchased Intangible Assets by Major Class) (Details) - USD ($) $ in Millions | Oct. 31, 2020 | Jul. 31, 2020 |
Finite-Lived Intangible Assets | ||
Gross Carrying Amount | $ 585.1 | $ 532.3 |
Accumulated Amortization | (196.3) | (174.1) |
Net Carrying Amount | 388.8 | 358.2 |
Developed technology | ||
Finite-Lived Intangible Assets | ||
Gross Carrying Amount | 432.6 | 425.9 |
Accumulated Amortization | (166.6) | (146.6) |
Net Carrying Amount | 266 | 279.3 |
Customer relationships | ||
Finite-Lived Intangible Assets | ||
Gross Carrying Amount | 134 | 87.6 |
Accumulated Amortization | (14.6) | (12.4) |
Net Carrying Amount | 119.4 | 75.2 |
Acquired intellectual property | ||
Finite-Lived Intangible Assets | ||
Gross Carrying Amount | 6.3 | 6.3 |
Accumulated Amortization | (3.3) | (3.2) |
Net Carrying Amount | 3 | 3.1 |
Trade name and trademarks | ||
Finite-Lived Intangible Assets | ||
Gross Carrying Amount | 9.4 | 9.4 |
Accumulated Amortization | (9.4) | (9.4) |
Net Carrying Amount | 0 | 0 |
Other | ||
Finite-Lived Intangible Assets | ||
Gross Carrying Amount | 2.8 | 3.1 |
Accumulated Amortization | (2.4) | (2.5) |
Net Carrying Amount | $ 0.4 | $ 0.6 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets (Amortization Expense) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Oct. 31, 2020 | Oct. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization expense | $ 23.6 | $ 16.9 |
Goodwill and Intangible Asset_6
Goodwill and Intangible Assets (Future Amortization Expense of Intangible Assets) (Details) $ in Millions | Oct. 31, 2020USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Remaining 2021 | $ 74.1 |
2022 | 94.3 |
2023 | 68.2 |
2024 | 58.2 |
2025 | 44.5 |
2026 and thereafter | 49.5 |
Total future amortization expense | $ 388.8 |
Deferred Contract Costs Deferre
Deferred Contract Costs Deferred Contract Costs (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Jul. 31, 2020 | |
Deferred Contract Costs | |||
Total deferred contract costs | $ 621.8 | $ 628.3 | |
Deferred contract costs, amortization expense | 65.8 | $ 55.6 | |
Impairment loss | 0 | $ 0 | |
Short-term deferred contract costs | |||
Deferred Contract Costs | |||
Total deferred contract costs | 213 | 206 | |
Long-term deferred contract costs | |||
Deferred Contract Costs | |||
Total deferred contract costs | $ 408.8 | $ 422.3 |
Debt (Additional Details) (Deta
Debt (Additional Details) (Details) $ / shares in Units, shares in Millions, $ in Billions | Jun. 03, 2020USD ($)dayshares$ / shares | Jul. 31, 2018USD ($)sharesday$ / shares | Oct. 31, 2020USD ($) | Jul. 31, 2020USD ($) |
Level 2 | ||||
Debt Instrument, Redemption | ||||
Fair value of convertible senior notes | $ | $ 3.9 | $ 4.1 | ||
2023 Notes | ||||
Debt Instrument, Redemption | ||||
Aggregate principal amount | $ | $ 1.7 | |||
Contractual interest rate (in percentage) | 0.75% | |||
Initial conversion rate (in shares per $1,000 principal amount) | 3.7545 | |||
Initial conversion price (in usd per share) | $ / shares | $ 266.35 | |||
Number of common stock convertible at initial conversion rate (in shares) | shares | 6.4 | |||
Debt instrument, redemption price, percentage | 100.00% | |||
2023 Notes, Option to Convert | ||||
Debt Instrument, Redemption | ||||
Threshold percentage of stock price trigger (in percentage) | 130.00% | |||
Threshold trading days (in days) | 20 | |||
Threshold consecutive trading days (in days) | 30 | |||
Threshold business days, per $1,000 principal (in days) | 5 | |||
Threshold consecutive trading days, per $1,000 principal (in days) | 5 | |||
Threshold percentage of notes price trigger, per $1,000 principal (in percentage) | 98.00% | |||
2025 Notes | ||||
Debt Instrument, Redemption | ||||
Aggregate principal amount | $ | $ 2 | |||
Contractual interest rate (in percentage) | 0.375% | |||
Threshold percentage of stock price trigger (in percentage) | 130.00% | |||
Threshold trading days (in days) | 20 | |||
Threshold consecutive trading days (in days) | 30 | |||
Initial conversion rate (in shares per $1,000 principal amount) | 3.3602 | |||
Initial conversion price (in usd per share) | $ / shares | $ 297.60 | |||
Number of common stock convertible at initial conversion rate (in shares) | shares | 6.7 | |||
Debt instrument, redemption price, percentage | 100.00% | |||
2025 Notes, Option To Convert | ||||
Debt Instrument, Redemption | ||||
Threshold percentage of stock price trigger (in percentage) | 130.00% | |||
Threshold trading days (in days) | 20 | |||
Threshold consecutive trading days (in days) | 30 | |||
Threshold business days, per $1,000 principal (in days) | 5 | |||
Threshold consecutive trading days, per $1,000 principal (in days) | 5 | |||
Threshold percentage of notes price trigger, per $1,000 principal (in percentage) | 98.00% |
Debt (Components of Convertible
Debt (Components of Convertible Senior Notes) (Details) - USD ($) $ in Millions | Oct. 31, 2020 | Jul. 31, 2020 |
Debt Instrument, Redemption | ||
Principal | $ 3,693 | $ 3,693 |
Less: debt discount and debt issuance costs, net of amortization | 573.9 | 608.9 |
Net carrying amount | 3,119.1 | 3,084.1 |
Equity component | 718 | 718 |
2023 Notes | ||
Debt Instrument, Redemption | ||
Principal | 1,693 | 1,693 |
Less: debt discount and debt issuance costs, net of amortization | 183.8 | 200 |
Net carrying amount | 1,509.2 | 1,493 |
Equity component | 315 | 315 |
2025 Notes | ||
Debt Instrument, Redemption | ||
Principal | 2,000 | 2,000 |
Less: debt discount and debt issuance costs, net of amortization | 390.1 | 408.9 |
Net carrying amount | 1,609.9 | 1,591.1 |
Equity component | $ 403 | $ 403 |
Debt (Schedule of Interest Expe
Debt (Schedule of Interest Expense Recognized) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Oct. 31, 2020 | Oct. 31, 2019 | |
Debt Instrument, Redemption | ||
Contractual interest expense | $ 5.1 | $ 3.2 |
Amortization of debt discount | 33.9 | 15 |
Amortization of debt issuance costs | 1.2 | 0.5 |
Total interest expense recognized | 40.2 | 18.7 |
2023 Notes | ||
Debt Instrument, Redemption | ||
Contractual interest expense | 3.2 | 3.2 |
Amortization of debt discount | 15.7 | 15 |
Amortization of debt issuance costs | 0.5 | 0.5 |
Total interest expense recognized | $ 19.4 | $ 18.7 |
Effective interest rate of the liability component | 5.20% | 5.20% |
2025 Notes | ||
Debt Instrument, Redemption | ||
Contractual interest expense | $ 1.9 | |
Amortization of debt discount | 18.2 | |
Amortization of debt issuance costs | 0.7 | |
Total interest expense recognized | $ 20.8 | |
Effective interest rate of the liability component | 5.40% |
Debt (Note Hedges) (Details)
Debt (Note Hedges) (Details) - USD ($) shares in Millions, $ in Millions | Jun. 03, 2020 | Jul. 31, 2018 |
2023 Note Hedges | ||
Schedule of Note Hedge Transactions | ||
Shares of common stock covered by note hedges (in shares) | 6.4 | |
Aggregate purchase | $ 332 | |
2025 Note Hedges | ||
Schedule of Note Hedge Transactions | ||
Shares of common stock covered by note hedges (in shares) | 6.7 | |
Aggregate purchase | $ 370.8 |
Debt (Warrants) (Details)
Debt (Warrants) (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | Jun. 03, 2020 | Jul. 31, 2018 |
2023 Warrants | ||
Class of Warrant or Right | ||
Warrants sold, shares authorized to sell to counterparties (in shares) | 6.4 | |
Strike price of warrants (in usd per share) | $ 417.80 | |
Aggregate proceeds | $ 145.4 | |
2025 Warrants | ||
Class of Warrant or Right | ||
Warrants sold, shares authorized to sell to counterparties (in shares) | 6.7 | |
Strike price of warrants (in usd per share) | $ 408.47 | |
Aggregate proceeds | $ 202.8 |
Debt (Revolving Credit Facility
Debt (Revolving Credit Facility) (Details) - Revolving Credit Facility | Sep. 04, 2018USD ($)day | Oct. 31, 2020USD ($) |
Line of Credit Facility | ||
Current borrowing capacity | $ 400,000,000 | |
Option for additional borrowing capacity | $ 350,000,000 | |
Revolving credit facility amount outstanding | $ 0 | |
Minimum Maturity Date Term Criteria | ||
Line of Credit Facility | ||
Number of days prior to maturity of 2023 Notes (in days) | day | 91 | |
Minimum Maturity Date Term, Cash and Cash Equivalents Balance Criteria | ||
Line of Credit Facility | ||
Amount added to outstanding principal amount of 2023 Notes in minimum maturity date criteria | $ 400,000,000 | |
Minimum | ||
Line of Credit Facility | ||
Commitment fee rate on undrawn amounts (in percentage) | 0.125% | |
Maximum | ||
Line of Credit Facility | ||
Commitment fee rate on undrawn amounts (in percentage) | 0.25% | |
Base Rate | Minimum | ||
Line of Credit Facility | ||
Spread on variable rate | 0.00% | |
Base Rate | Maximum | ||
Line of Credit Facility | ||
Spread on variable rate | 0.75% | |
LIBOR | Minimum | ||
Line of Credit Facility | ||
Spread on variable rate | 1.00% | |
LIBOR | Maximum | ||
Line of Credit Facility | ||
Spread on variable rate | 1.75% |
Commitments and Contingencies_3
Commitments and Contingencies (Manufacturing Purchase Commitments) (Details) $ in Millions | Oct. 31, 2020USD ($) |
Manufacturing products and components | |
Unrecorded Unconditional Purchase Obligation | |
Manufacturing purchase commitments | $ 140.8 |
Commitments and Contingencies_4
Commitments and Contingencies (Other Purchase Commitments) (Details) - Cloud and other services $ in Millions | Oct. 31, 2020USD ($) |
Unrecorded Unconditional Purchase Obligation | |
Remaining 2021 | $ 0 |
2022 | 159.2 |
2023 | 227.2 |
2024 | 285.7 |
2025 | 345.3 |
2026 and thereafter | 551.1 |
Total other purchase commitments | $ 1,568.5 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - USD ($) shares in Millions | 3 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Feb. 28, 2019 | |
Class of Stock | |||
Repurchase and retirement of common stock (in shares) | 2.1 | ||
Repurchase and retirement of common stock | $ 500,000,000 | $ 198,100,000 | |
Stock repurchase, remaining authorized repurchase amount | $ 301,900,000 | ||
Share Repurchase Program B | |||
Class of Stock | |||
Share repurchase, authorized amount | $ 1,000,000,000 |
Equity Award Plans (Performance
Equity Award Plans (Performance Stock Option Activities) - Narrative (Details) - Stock Options with Service and Market Conditions $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended |
Oct. 31, 2020USD ($)$ / sharesshares | |
Options, Additional Disclosures | |
Options exercisable (in shares) | shares | 2.8 |
Options exercisable, weighted-average exercise price (in usd per share) | $ / shares | $ 194.14 |
Options exercisable, weighted-average remaining contractual term (in years) | 4 years 10 months 24 days |
Options exercisable, aggregate intrinsic value | $ | $ 74.8 |
Equity Award Plans (Restricted
Equity Award Plans (Restricted Stock Unit (RSU) and Performance-Based Stock Unit (PSU) Activities) (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | |
Oct. 31, 2020 | Jul. 31, 2020 | |
RSUs Outstanding | ||
RSUs and PSUs, Outstanding Roll Forward | ||
Balance, beginning (in shares) | 6.6 | |
Granted (in shares) | 1.8 | |
Vested (in shares) | (0.8) | |
Forfeited (in shares) | (0.2) | |
Balance, ending (in shares) | 7.4 | |
RSUs and PSUs, Outstanding, Weighted-Average Grant-Date Fair Value Per Share | ||
Balance, beginning (in usd per share) | $ 203.30 | |
Granted (in usd per share) | 241.67 | |
Vested (in usd per share) | 187.16 | |
Forfeited (in usd per share) | 207.01 | |
Balance, ending (in usd per share) | $ 213.78 | |
RSUs and PSUs, Additional Disclosures | ||
Aggregate intrinsic value | $ 1,644.1 | $ 1,688.1 |
PSUs Outstanding | ||
RSUs and PSUs, Outstanding Roll Forward | ||
Balance, beginning (in shares) | 0.6 | |
Granted (in shares) | 0.4 | |
Vested (in shares) | (0.1) | |
Forfeited (in shares) | 0 | |
Balance, ending (in shares) | 0.9 | |
RSUs and PSUs, Outstanding, Weighted-Average Grant-Date Fair Value Per Share | ||
Balance, beginning (in usd per share) | $ 231.42 | |
Granted (in usd per share) | 244.15 | |
Vested (in usd per share) | 210.57 | |
Forfeited (in usd per share) | 229.47 | |
Balance, ending (in usd per share) | $ 238.35 | |
RSUs and PSUs, Additional Disclosures | ||
Aggregate intrinsic value | $ 196.2 | $ 147.2 |
PSUs | Minimum | ||
RSUs and PSUs, Additional Disclosures | ||
Award vesting period | 1 year | |
PSUs | Maximum | ||
RSUs and PSUs, Additional Disclosures | ||
Award vesting period | 4 years |
Equity Award Plans (Allocation
Equity Award Plans (Allocation of Share-Based Compensation Expense) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Oct. 31, 2020 | Oct. 31, 2019 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs | ||
Share-based compensation expense | $ 212.9 | $ 151.2 |
Share based compensation expense, accelerated cost | 7.1 | |
Total compensation cost not yet recognized, unvested awards | $ 1,800 | |
Share based compensation, cost not yet recognized, amortization period | 2 years 8 months 12 days | |
Research and development | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs | ||
Share-based compensation expense | $ 95.4 | 62.4 |
Sales and marketing | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs | ||
Share-based compensation expense | 64.9 | 43.8 |
General and administrative | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs | ||
Share-based compensation expense | 28.9 | 24.8 |
Product | Cost of revenue | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs | ||
Share-based compensation expense | 1.5 | 1.3 |
Subscription and support | Cost of revenue | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs | ||
Share-based compensation expense | $ 22.2 | $ 18.9 |
Income Taxes (Details)
Income Taxes (Details) | 3 Months Ended | |
Oct. 31, 2020 | Oct. 31, 2019 | |
Income Tax Disclosure [Abstract] | ||
Effective income tax rate (in percentage) | (12.00%) | (9.40%) |
Net Loss Per Share (Computation
Net Loss Per Share (Computation of Basic and Diluted Net Loss Per Share) (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | |
Oct. 31, 2020 | Oct. 31, 2019 | |
Earnings Per Share [Abstract] | ||
Net loss | $ (92.2) | $ (59.6) |
Weighted-average shares used to compute net loss per share, basic and diluted | 95.5 | 96.6 |
Net loss per share, basic and diluted (in usd per share) | $ (0.97) | $ (0.62) |
Net Loss Per Share (Schedule of
Net Loss Per Share (Schedule of Antidilutive Securities Excluded from Computation) (Details) - shares shares in Millions | 3 Months Ended | |
Oct. 31, 2020 | Oct. 31, 2019 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share | ||
Antidilutive securities (in shares) | 37.4 | 27.1 |
Convertible senior notes | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share | ||
Antidilutive securities (in shares) | 13.1 | 6.4 |
Warrants related to the issuance of convertible senior notes | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share | ||
Antidilutive securities (in shares) | 13.1 | 9.6 |
RSUs and PSUs | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share | ||
Antidilutive securities (in shares) | 8.3 | 7.7 |
Options to purchase common stock, including PSOs | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share | ||
Antidilutive securities (in shares) | 2.8 | 3.2 |
Restricted stock awards and performance-based stock awards | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share | ||
Antidilutive securities (in shares) | 0 | 0.1 |
ESPP shares | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share | ||
Antidilutive securities (in shares) | 0.1 | 0.1 |
Other Income, Net (Details)
Other Income, Net (Details) - USD ($) $ in Millions | 3 Months Ended | |
Oct. 31, 2020 | Oct. 31, 2019 | |
Other Income and Expenses [Abstract] | ||
Interest income | $ 2.9 | $ 15.8 |
Foreign currency exchange gains (losses), net | 2.1 | 0.4 |
Other | (2.6) | 0 |
Total other income, net | $ 2.4 | $ 16.2 |
Subsequent Events (Details)
Subsequent Events (Details) - Subsequent Event $ in Millions | 1 Months Ended |
Nov. 30, 2020USD ($) | |
Expanse Inc. | |
Subsequent Events | |
Total purchase consideration | $ 800 |
Cash and common stock | 670 |
Fair value of replacement awards | 130 |
Sinefa Group, Inc. | |
Subsequent Events | |
Total purchase consideration | $ 44 |