Cover Page
Cover Page - shares | 6 Months Ended | |
Jul. 31, 2019 | Aug. 29, 2019 | |
Cover page. | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jul. 31, 2019 | |
Document Transition Report | false | |
Entity File Number | 001-35498 | |
Entity Registrant Name | Splunk Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 86-1106510 | |
Entity Address, Address Line One | 270 Brannan Street | |
Entity Address, City or Town | San Francisco | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 94107 | |
City Area Code | 415 | |
Local Phone Number | 848-8400 | |
Title of 12(b) Security | Common Stock, par value $0.001 per share | |
Trading Symbol | SPLK | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 151,348,574 | |
Entity Central Index Key | 0001353283 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --01-31 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q2 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jul. 31, 2019 | Jan. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 1,672,005 | $ 1,876,165 |
Investments, current | 903,864 | 881,220 |
Accounts receivable, net | 408,908 | 469,658 |
Prepaid expenses and other current assets | 83,033 | 73,197 |
Deferred commissions, current | 77,616 | 78,223 |
Total current assets | 3,145,426 | 3,378,463 |
Investments, non-current | 94,009 | 110,588 |
Operating lease right-of-use assets | 215,228 | 0 |
Property and equipment, net | 94,869 | 158,276 |
Intangible assets, net | 77,417 | 91,622 |
Goodwill | 503,388 | 503,388 |
Deferred commissions, non-current | 64,705 | 64,766 |
Other assets | 292,528 | 193,140 |
Total assets | 4,487,570 | 4,500,243 |
Current liabilities: | ||
Accounts payable | 25,924 | 20,418 |
Accrued compensation | 179,846 | 226,061 |
Accrued expenses and other liabilities | 176,075 | 125,641 |
Deferred revenue, current | 645,370 | 673,018 |
Total current liabilities | 1,027,215 | 1,045,138 |
Convertible senior notes, net | 1,673,569 | 1,634,474 |
Operating lease liabilities | 191,471 | 0 |
Deferred revenue, non-current | 160,888 | 204,929 |
Other liabilities, non-current | 587 | 95,245 |
Total non-current liabilities | 2,026,515 | 1,934,648 |
Total liabilities | 3,053,730 | 2,979,786 |
Commitments and contingencies (Note 3) | ||
Stockholders' equity: | ||
Common stock: $0.001 par value; 1,000,000,000 shares authorized; 151,344,012 shares issued and outstanding at July 31, 2019, and 149,167,298 shares issued and outstanding at January 31, 2019 | 151 | 149 |
Accumulated other comprehensive loss | (3,484) | (2,506) |
Additional paid-in capital | 2,918,277 | 2,754,858 |
Accumulated deficit | (1,481,104) | (1,232,044) |
Total stockholders' equity | 1,433,840 | 1,520,457 |
Total liabilities and stockholders' equity | $ 4,487,570 | $ 4,500,243 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Jul. 31, 2019 | Jan. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued | 151,344,012 | 149,167,298 |
Common stock, shares outstanding | 151,344,012 | 149,167,298 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | ||
Revenues | |||||
Total revenues | $ 516,558 | $ 388,303 | $ 941,408 | $ 699,942 | |
Cost of revenues | |||||
Total cost of revenues | [1] | 98,308 | 83,748 | 194,131 | 161,718 |
Gross profit | 418,250 | 304,555 | 747,277 | 538,224 | |
Operating expenses | |||||
Research and development | [1] | 134,110 | 106,739 | 263,400 | 193,096 |
Sales and marketing | [1] | 298,773 | 243,830 | 577,734 | 461,866 |
General and administrative | [1] | 72,264 | 57,844 | 138,026 | 108,586 |
Total operating expenses | [1] | 505,147 | 408,413 | 979,160 | 763,548 |
Operating loss | (86,897) | (103,858) | (231,883) | (225,324) | |
Interest and other income (expense), net | |||||
Interest income | 16,415 | 3,564 | 32,761 | 6,751 | |
Interest expense | (24,104) | (2,058) | (47,121) | (4,131) | |
Other income (expense), net | (654) | (336) | (1,193) | (471) | |
Total interest and other income (expense), net | (8,343) | 1,170 | (15,553) | 2,149 | |
Loss before income taxes | (95,240) | (102,688) | (247,436) | (223,175) | |
Income tax provision (benefit) | 5,632 | 811 | 8,865 | (1,177) | |
Net loss | $ (100,872) | $ (103,499) | $ (256,301) | $ (221,998) | |
Net loss per share: | |||||
Basic and diluted (in dollars per share) | $ (0.67) | $ (0.71) | $ (1.71) | $ (1.54) | |
Weighted-average shares outstanding: | |||||
Basic and diluted (in shares) | 150,306 | 145,030 | 149,723 | 144,306 | |
License | |||||
Revenues | |||||
Total revenues | $ 279,279 | $ 200,668 | $ 482,141 | $ 339,643 | |
Cost of revenues | |||||
Total cost of revenues | [1] | 5,936 | 5,671 | 11,618 | 10,795 |
Maintenance and services | |||||
Revenues | |||||
Total revenues | 237,279 | 187,635 | 459,267 | 360,299 | |
Cost of revenues | |||||
Total cost of revenues | [1] | $ 92,372 | $ 78,077 | $ 182,513 | $ 150,923 |
[1] | Amounts include stock-based compensation expense, as follows: Cost of revenues, $10,459 thousand and $8,947 thousand; Research and development, $40,451 thousand and $33,597 thousand; Sales and marketing, $49,007 thousand and $45,546 thousand; General and administrative, $23,096 thousand and $16,953 thousand for the three months ended July 31, 2019 and 2018, respectively. Amounts include stock-based compensation expense, as follows: Cost of revenues, $21,284 thousand and $17,751 thousand; Research and development, $81,719 thousand and $60,013 thousand; Sales and marketing, $99,275 thousand and $88,593 thousand; General and administrative, $43,798 thousand and $33,307 thousand for the six months ended July 31, 2019 and 2018, respectively. |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | |
Stock-based compensation | $ 246,076 | $ 199,664 | ||
Cost of revenues | ||||
Stock-based compensation | $ 10,459 | $ 8,947 | 21,284 | 17,751 |
Research and development | ||||
Stock-based compensation | 40,451 | 33,597 | 81,719 | 60,013 |
Sales and marketing | ||||
Stock-based compensation | 49,007 | 45,546 | 99,275 | 88,593 |
General and administrative | ||||
Stock-based compensation | $ 23,096 | $ 16,953 | $ 43,798 | $ 33,307 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | |
Net loss | $ (100,872) | $ (103,499) | $ (256,301) | $ (221,998) |
Other comprehensive gain (loss): | ||||
Net unrealized gain on investments (net of tax) | 710 | 515 | 1,042 | 707 |
Foreign currency translation adjustments | (1,029) | (1,707) | (2,020) | (3,593) |
Total other comprehensive loss | (319) | (1,192) | (978) | (2,886) |
Comprehensive loss | $ (101,191) | $ (104,691) | $ (257,279) | $ (224,884) |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 6 Months Ended | |
Jul. 31, 2019 | Jul. 31, 2018 | |
Cash flows from operating activities | ||
Net loss | $ (256,301) | $ (221,998) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities | ||
Depreciation and amortization | 27,141 | 24,167 |
Amortization of deferred commissions | 53,882 | 32,877 |
Amortization of investment premiums (accretion of discounts) | (5,645) | (537) |
Amortization of debt discount and issuance costs | 39,095 | 0 |
Stock-based compensation | 246,076 | 199,664 |
Deferred income taxes | (184) | (125) |
Changes in operating assets and liabilities, net of acquisitions | ||
Accounts receivable, net | 60,750 | 156,362 |
Prepaid expenses and other assets | (110,349) | (21,937) |
Deferred commissions | (53,214) | (43,360) |
Accounts payable | 5,316 | 2,990 |
Accrued compensation | (46,215) | (11,833) |
Accrued expenses and other liabilities | 17,395 | 6,259 |
Deferred revenue | (71,689) | (12,518) |
Net Cash Provided by (Used in) Operating Activities | (93,942) | 110,011 |
Cash flows from investing activities | ||
Purchases of investments | (539,723) | (198,631) |
Maturities of investments | 541,595 | 347,176 |
Acquisitions, net of cash acquired | 0 | (394,910) |
Purchases of property and equipment | (26,434) | (7,858) |
Other investment activities | (1,250) | (4,375) |
Net Cash Used in Investing Activities | (25,812) | (258,598) |
Cash flows from financing activities | ||
Proceeds from the exercise of stock options | 556 | 1,354 |
Proceeds from employee stock purchase plan | 34,482 | 24,201 |
Taxes paid related to net share settlement of equity awards | (117,693) | (779) |
Repayment of financing lease obligation | 0 | (1,218) |
Net Cash Provided by (Used in) Financing Activities | (82,655) | 23,558 |
Effect of exchange rate changes on cash and cash equivalents | (1,751) | (1,237) |
Net decrease in cash and cash equivalents | (204,160) | (126,266) |
Cash and cash equivalents at beginning of period | 1,876,165 | 545,947 |
Cash and cash equivalents at end of period | 1,672,005 | 419,681 |
Supplemental disclosures | ||
Cash paid for income taxes | 15,249 | 4,035 |
Cash paid for interest | 7,747 | 4,123 |
Non-cash investing activities | ||
Increase (decrease) in accrued purchases of property and equipment | $ (274) | $ 129 |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY - USD ($) $ in Thousands | Total | Common stock | Additional paid-in capital | Accumulated other comprehensive loss | Accumulated deficit |
Cumulative-effect adjustment from adoption of ASU | Accounting Standards Update 2016-02 | $ 0 | ||||
Cumulative-effect adjustment from adoption of ASU | Accounting Standards Update 2016-16 | (596) | ||||
Balance, beginning of period at Jan. 31, 2018 | $ 143 | $ 2,086,893 | $ 156 | (955,871) | |
Issuance of restricted stock awards | 1 | ||||
Vesting of restricted stock units | 2 | ||||
Stock-based compensation | 199,664 | ||||
Issuance of common stock upon exercise of options | 1,353 | ||||
Fair value of replacement equity awards attributable to pre-acquisition service | 15,776 | ||||
Taxes paid related to net share settlement of equity awards | 0 | ||||
Issuance of common stock upon ESPP purchase | 24,199 | ||||
Unrealized gain from investments | 707 | ||||
Net change in cumulative translation adjustments | $ (3,593) | (3,593) | |||
Net loss | (221,998) | (221,998) | |||
Balance, end of period at Jul. 31, 2018 | 1,146,836 | 146 | 2,327,885 | (2,730) | (1,178,465) |
Cumulative-effect adjustment from adoption of ASU | Accounting Standards Update 2016-02 | 0 | ||||
Cumulative-effect adjustment from adoption of ASU | Accounting Standards Update 2016-16 | 0 | ||||
Balance, beginning of period at Apr. 30, 2018 | 144 | 2,194,900 | (1,538) | (1,074,966) | |
Issuance of restricted stock awards | 0 | ||||
Vesting of restricted stock units | 2 | ||||
Stock-based compensation | 105,043 | ||||
Issuance of common stock upon exercise of options | 241 | ||||
Fair value of replacement equity awards attributable to pre-acquisition service | 3,502 | ||||
Taxes paid related to net share settlement of equity awards | 0 | ||||
Issuance of common stock upon ESPP purchase | 24,199 | ||||
Unrealized gain from investments | 515 | ||||
Net change in cumulative translation adjustments | (1,707) | (1,707) | |||
Net loss | (103,499) | (103,499) | |||
Balance, end of period at Jul. 31, 2018 | 1,146,836 | 146 | 2,327,885 | (2,730) | (1,178,465) |
Cumulative-effect adjustment from adoption of ASU | Accounting Standards Update 2016-02 | 7,241 | ||||
Cumulative-effect adjustment from adoption of ASU | Accounting Standards Update 2016-16 | 0 | ||||
Balance, beginning of period at Jan. 31, 2019 | 1,520,457 | 149 | 2,754,858 | (2,506) | (1,232,044) |
Issuance of restricted stock awards | 0 | ||||
Vesting of restricted stock units | 2 | ||||
Stock-based compensation | 246,076 | ||||
Issuance of common stock upon exercise of options | 554 | ||||
Fair value of replacement equity awards attributable to pre-acquisition service | 0 | ||||
Taxes paid related to net share settlement of equity awards | (117,693) | ||||
Issuance of common stock upon ESPP purchase | 34,482 | ||||
Unrealized gain from investments | 1,042 | ||||
Net change in cumulative translation adjustments | (2,020) | (2,020) | |||
Net loss | (256,301) | (256,301) | |||
Balance, end of period at Jul. 31, 2019 | 1,433,840 | 151 | 2,918,277 | (3,484) | (1,481,104) |
Cumulative-effect adjustment from adoption of ASU | Accounting Standards Update 2016-02 | 0 | ||||
Cumulative-effect adjustment from adoption of ASU | Accounting Standards Update 2016-16 | 0 | ||||
Balance, beginning of period at Apr. 30, 2019 | 150 | 2,809,273 | (3,165) | (1,380,232) | |
Issuance of restricted stock awards | 0 | ||||
Vesting of restricted stock units | 1 | ||||
Stock-based compensation | 123,013 | ||||
Issuance of common stock upon exercise of options | 195 | ||||
Fair value of replacement equity awards attributable to pre-acquisition service | 0 | ||||
Taxes paid related to net share settlement of equity awards | (48,686) | ||||
Issuance of common stock upon ESPP purchase | 34,482 | ||||
Unrealized gain from investments | 710 | ||||
Net change in cumulative translation adjustments | (1,029) | (1,029) | |||
Net loss | (100,872) | (100,872) | |||
Balance, end of period at Jul. 31, 2019 | $ 1,433,840 | $ 151 | $ 2,918,277 | $ (3,484) | $ (1,481,104) |
Description of the Business and
Description of the Business and Significant Accounting Policies | 6 Months Ended |
Jul. 31, 2019 | |
Accounting Policies [Abstract] | |
Description of the Business and Significant Accounting Policies | Description of the Business and Significant Accounting Policies Business Splunk Inc. (“we,” “us,” “our”) provides innovative software solutions that enable organizations to gain real-time operational intelligence by harnessing the value of their data. Our offerings enable users to investigate, monitor, analyze and act on machine data regardless of format or source. Our offerings address large and diverse data sets commonly referred to as big data and are specifically tailored for machine data. Machine data is produced by nearly every software application and electronic device across an organization and contains a real-time record of various activities, such as transactions, customer and user behavior, and security threats. Our offerings help users derive new insights from machine data that can be used to, among other things, improve service levels, reduce operational costs, mitigate security risks, demonstrate and maintain compliance, and drive better business decisions. We were incorporated in California in October 2003 and reincorporated in Delaware in May 2006. Fiscal Year Our fiscal year ends on January 31. References to fiscal 2020, for example, refer to the fiscal year ending January 31, 2020. Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. The condensed consolidated balance sheet data as of January 31, 2019 was derived from audited financial statements, but does not include all disclosures required by GAAP. Therefore, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the Annual Report on Form 10-K for the fiscal year ended January 31, 2019 , filed with the SEC on March 27, 2019 . In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all normal recurring adjustments necessary to state fairly the financial position, results of operations, comprehensive loss and cash flows for the interim periods, but are not necessarily indicative of the results of operations to be anticipated for the full fiscal 2020 . Reclassifications Certain reclassifications have been made to prior year balances in order to conform to the current period presentation. “Interest income” and “Interest expense” have been reclassified from “Interest income (expense), net” on the condensed consolidated statements of operations. These reclassifications had no impact on the previously reported net loss or accumulated deficit. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting periods covered by the financial statements and accompanying notes. In particular, we make estimates with respect to the stand-alone selling price for each distinct performance obligation included in customer contracts with multiple performance obligations, uncollectible accounts receivable, the assessment of the useful life and recoverability of long-lived assets (property and equipment, goodwill and identified intangibles), the period of benefit for deferred commissions, stock-based compensation expense, the fair value of assets acquired and liabilities assumed for business combinations, income taxes, the discount rate used for operating leases, and contingencies. Actual results could differ from those estimates. Segments We operate our business as one operating segment: the development and marketing of software solutions that enable our customers to gain real-time operational intelligence by harnessing the value of their data. Our chief operating decision maker is our Chief Executive Officer, who reviews financial information presented on a consolidated basis for purposes of making operating decisions, assessing financial performance and allocating resources. Principles of Consolidation The accompanying unaudited condensed consolidated financial statements include the accounts of Splunk Inc. and its direct and indirect wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated upon consolidation. Leases We determine if an arrangement contains a lease and the classification of that lease, if applicable, at the inception of a contract. We primarily lease our facilities under operating leases. Operating lease right-of-use assets and liabilities are recognized at the present value of the future lease payments at the lease commencement date. We calculate the operating lease right-of-use assets based on the corresponding lease liability adjusted for (i) payments made at or before the commencement date, (ii) initial direct costs we incur and (iii) tenant incentives under the lease. We do not account for renewals or early terminations unless we are reasonably certain to exercise these options at commencement. Operating lease expense is recognized on a straight-line basis over the lease term. We account for lease and non-lease components as a single lease component for our operating leases. We do not record leases with terms of 12 months or less on our condensed consolidated balance sheets. As the implicit rate for our operating leases is generally not determinable, we use our incremental borrowing rate as our discount rate at the lease commencement date to determine the present value of lease payments. We determine the discount rate of our leases by considering various factors, such as our credit rating, interest rates of similar debt instruments of entities with comparable credit ratings, the lease term and the currency in which the lease is denominated. Our discount rate was determined using a portfolio approach. Our operating lease assets are included in “Operating lease right-of-use assets” and the current and non-current portions of our operating lease liabilities are included in “Accrued expenses and other liabilities” and “Operating lease liabilities,” respectively, on our condensed consolidated balance sheets. As of July 31, 2019 , we had no finance leases. Refer to Note 4 “Leases” for details. Foreign Currency The functional currency of our foreign subsidiaries is their respective local currency, with the exception of our United Kingdom subsidiary, in which the functional currency is the U.S. dollar. Translation adjustments arising from the use of differing exchange rates from period to period are included in “Accumulated other comprehensive income (loss)” within the condensed consolidated statements of stockholders’ equity. Foreign currency transaction gains and losses are included in “Other income (expense), net.” All assets and liabilities denominated in a foreign currency are translated into U.S. dollars at the exchange rate on the balance sheet date. Expenses are translated at the average exchange rate during the period. Equity transactions are translated using historical exchange rates. Revenue Recognition We generate revenues primarily in the form of software license and related maintenance fees, cloud services and other service fees. Licenses for on-premises software are either term or perpetual licenses and provide the customer with a right to use the software. When a term license is purchased, maintenance is bundled with the license for the term of the license period. Typically, when purchasing a perpetual license, a customer also purchases one year of maintenance for which we charge a percentage of the license fee. Cloud services are provided on a subscription basis and give our customers access to our cloud solutions, which include related customer support. Other services include training and professional services that are not integral to the functionality of the licenses or cloud services. Revenue from on-premises licenses is generally recognized upfront upon transfer of control of the software, which occurs at delivery, or when the license term commences, if later. We recognize revenue from maintenance contracts ratably over the service period. Cloud services revenue is recognized ratably over the cloud service term. Training and professional services are provided either on a time and material basis, in which revenues are recognized as services are delivered, or over a contractual term, in which revenues are recognized ratably. With respect to contracts that include customer acceptance provisions, we recognize revenue upon customer acceptance. Our policy is to record revenues net of any applicable sales, use or excise taxes. Our contracts with customers often contain multiple performance obligations. For these contracts, we account for individual performance obligations separately if they are distinct. The transaction price is allocated to the separate performance obligations on a relative standalone selling price (“SSP”) basis. We determine the SSP based on an observable standalone selling price when it is available, as well as other factors, including the price charged to customers, our discounting practices, and our overall pricing objectives, while maximizing observable inputs. In situations where pricing is highly variable, we estimate the SSP using the residual approach. A receivable is recorded in the period we deliver products or provide services, or when we have an unconditional right to payment. Most of our multi-year on-premises term license contracts are invoiced annually and we generally recognize the total amount of the license revenues upfront and record a corresponding receivable, if we have an unconditional right to receive payment. Payment terms and conditions vary by contract type, although our terms generally include a requirement of payment within 30 to 60 days. In instances where the timing of revenue recognition differs from the timing of payment, we have determined our contracts do not include a significant financing component. The primary purpose of our invoicing terms is to provide customers with simplified and predictable ways of purchasing our products and services, not to receive financing from our customers or to provide customers with financing. Deferred revenue is recorded when we invoice a contract or deliver a license prior to recognizing revenue. It is comprised of balances related to maintenance, cloud services, training and professional services invoiced at the beginning of each service period, as well as for licenses that we delivered prior to the license term commencing. Recently Adopted Accounting Standards Standard Description Effective Date Effect on the Condensed Consolidated Financial Statements (or Other Significant Matters) Accounting Standards Update (“ASU”) No. 2018-15 (Subtopic 350-40), Intangibles - Goodwill and Other - Internal-Use Software: Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract The standard aligns the requirements for capitalizing implementation costs in a cloud computing arrangement with the requirements for capitalizing implementation costs incurred for an internal-use software license. We early adopted this new standard as of May 1, 2019. The adoption of this new standard did not have a material impact on our condensed consolidated financial statements. ASU No. 2018-13 (Topic 820), Fair Value Measurement: Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement The new standard no longer requires disclosure of the amount and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy, but public companies will be required to disclose the range and weighted-average used to develop significant unobservable inputs for Level 3 fair value measurements. We adopted this new standard as of February 1, 2019. The adoption of this new standard did not have a material impact on our condensed consolidated financial statements. ASU No. 2016-02 (Topic 842), Leases The new standard supersedes the lease recognition requirements in Accounting Standards Codification (“ASC”) Topic 840, Leases. The standard requires an entity to recognize right-of-use assets and lease liabilities arising from a lease for operating leases, initially measured at the present value of the lease payments on the condensed consolidated balance sheets. The impact of such leases on the condensed consolidated statements of operations and cash flows will continue to be treated in a similar manner under current GAAP. The standard also requires additional qualitative and quantitative disclosures. In July 2018, ASU No. 2018-10, Codification Improvements to Topic 842, Leases, was issued which clarifies the codification or corrects unintended application of the guidance. We adopted this new standard as of February 1, 2019, using the cumulative-effect transition method recognized as of the date of initial application, as amended by ASU No. 2018-11. Under this method, we are not required to restate or disclose the effects of applying Topic 842 for comparative periods. As the result of our adoption, we recognized Operating lease right-of-use assets of $199.8 million and current and non-current Operating lease liabilities of $211.9 million on our condensed consolidated balance sheets at February 1, 2019. Additionally, we recorded a decrease to our opening accumulated deficit of approximately $7.2 million related to the derecognition of build-to-suit lease assets and liabilities. We have updated our accounting policies, systems, processes and internal controls, and have allocated internal and external resources to assist us during our implementation efforts. We applied the following practical expedients as permitted under Topic 842: (i) we elected to account for lease and non-lease components as a single lease component, and (ii) we elected the package of practical expedients permitted under the transition guidance, which allowed us to carryforward (1) our historical lease classification, (2) our assessment on whether a contract was or contains a lease, and (3) our initial direct costs for leases that existed prior to January 31, 2019. Recently Issued Accounting Pronouncements Standard Description Effective Date Effect on the Condensed Consolidated Financial Statements (or Other Significant Matters) ASU No. 2016-13 (Topic 326), Financial Instruments - Credit Losses The amendments in this update require a financial asset (or a group of financial assets) measured at an amortized cost basis to be presented at the net amount expected to be collected. The new approach to estimating credit losses (referred to as the current expected credit losses model) applies to most financial assets measured at amortized cost and certain other instruments, including trade and other receivables, loans and held-to-maturity debt securities. First quarter of fiscal 2021, although early adoption is permitted. We are currently evaluating whether the adoption of this standard will have a material impact on our condensed consolidated financial statements. |
Investments and Fair Value Meas
Investments and Fair Value Measurements | 6 Months Ended |
Jul. 31, 2019 | |
Investments, Debt and Equity Securities and Fair Value Disclosures [Abstract] | |
Investments and Fair Value Measurements | Investments and Fair Value Measurements The carrying amounts of certain of our financial instruments including cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate fair value due to their short-term maturities. Assets and liabilities recorded at fair value in the financial statements are categorized based upon the level of judgment associated with the inputs used to measure their fair value. Hierarchical levels that are directly related to the amount of subjectivity associated with the inputs to the valuation of these assets or liabilities are as follows: Level 1—Observable inputs, such as quoted prices in active markets for identical assets or liabilities. Level 2—Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Assets and liabilities measured at fair value are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires management to make judgments and consider factors specific to the asset or liability. The following table sets forth the fair value of our financial assets that were measured on a recurring basis: July 31, 2019 January 31, 2019 (In thousands) Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Assets: Money market funds $ 56,707 $ — $ — $ 56,707 $ 46,311 $ — $ — $ 46,311 U.S. treasury securities — 824,192 — 824,192 — 980,940 — 980,940 Corporate bonds — 149,990 — 149,990 — — — — Commercial paper — 19,869 — 19,869 — — — — Other — — 4,000 4,000 — — 4,744 4,744 Reported as: Assets: Cash and cash equivalents $ 65,004 $ 46,311 Investments, current 903,864 881,220 Investments, non-current 85,890 104,463 Total $ 1,054,758 $ 1,031,994 Our investments in money market funds are measured at fair value on a recurring basis. These money market funds are actively traded and reported daily through a variety of sources. The fair value of the money market fund investments is classified as Level 1. We invest in U.S. treasury securities, corporate bonds and commercial paper, which we have classified as available-for-sale investments. The following table presents our available-for-sale investments as of July 31, 2019 : (In thousands) Amortized Cost Unrealized Gains Unrealized Losses Fair Value Cash and cash equivalents: U.S. treasury securities $ 8,296 $ 1 $ — $ 8,297 Investments, current: U.S. treasury securities 815,244 821 (170 ) 815,895 Corporate bonds 67,972 132 (4 ) 68,100 Commercial paper 19,847 22 — 19,869 Investments, non-current: Corporate bonds 81,514 379 (3 ) 81,890 Total available-for-sale investments $ 992,873 $ 1,355 $ (177 ) $ 994,051 The following table presents our available-for-sale investments as of January 31, 2019 : (In thousands) Amortized Cost Unrealized Gains Unrealized Losses Fair Value Investments, current: U.S. treasury securities $ 881,206 $ 131 $ (117 ) $ 881,220 Investments, non-current: U.S. treasury securities 99,597 134 (11 ) 99,720 Total available-for-sale investments $ 980,803 $ 265 $ (128 ) $ 980,940 The following table presents the fair values and unrealized losses of our available-for-sale investments, classified by length of time that the securities have been in a continuous unrealized loss position: Less than 12 Months 12 Months or Greater Total (In thousands) Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses July 31, 2019 U.S. treasury securities $ 178,703 $ (170 ) $ — $ — $ 178,703 $ (170 ) Corporate bonds 12,512 (7 ) — — 12,512 (7 ) January 31, 2019 U.S. treasury securities $ 582,761 $ (128 ) $ — $ — $ 582,761 $ (128 ) As of July 31, 2019 and January 31, 2019 , we did not consider any of our investments to be other-than-temporarily impaired. The contractual maturities of our investments are as follows: (In thousands) July 31, 2019 Due within one year $ 912,161 Due within one to two years 81,890 Total $ 994,051 Investments with maturities of less than 12 months from the balance sheet date are classified as current assets, which are available for use to fund current operations. Investments with maturities greater than 12 months from the balance sheet date are classified as long-term assets. Convertible Senior Notes Refer to Note 7 “Convertible Senior Notes” for details regarding the fair value of our convertible senior notes. Equity Investments Our equity investments are reported in “Investments, non-current” on our condensed consolidated balance sheets. The following table provides a summary of our equity investments: (In thousands) July 31, 2019 January 31, 2019 Equity investments without readily determinable fair values $ 6,244 $ 5,000 Equity investments under the equity method of accounting 1,875 1,125 Total $ 8,119 $ 6,125 |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jul. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Legal Proceedings We are subject to certain routine legal and regulatory proceedings, as well as demands and claims that arise in the normal course of our business. We make a provision for a liability relating to legal matters when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. These provisions are reviewed at least quarterly and adjusted to reflect the impact of negotiations, estimated settlements, legal rulings, advice of legal counsel and other information and events pertaining to a particular matter. In our opinion, resolution of any pending claims (either individually or in the aggregate) is not expected to have a material adverse impact on our condensed consolidated results of operations, cash flows or financial position, nor is it possible to provide an estimated amount of any such loss. However, depending on the nature and timing of any such dispute, an unfavorable resolution of a matter could materially affect our future financial position, results of operations or cash flows, or all, in a particular period. Indemnification Arrangements During the ordinary course of business, we may indemnify, hold harmless and agree to reimburse for losses suffered or incurred, our customers, vendors, and each of their affiliates for certain intellectual property infringement and other claims by third parties with respect to our offerings, in connection with our commercial license arrangements or related to general business dealings with those parties. As permitted under Delaware law, we have entered into indemnification agreements with our officers, directors and certain employees, indemnifying them for certain events or occurrences while they serve as our officers or directors or those of our direct and indirect subsidiaries. To date, there have not been any costs incurred in connection with such indemnification obligations; therefore, there is no accrual of such amounts as of July 31, 2019 . We are unable to estimate the maximum potential impact of these indemnifications on our future results of operations. |
Leases
Leases | 6 Months Ended |
Jul. 31, 2019 | |
Leases [Abstract] | |
Leases | Leases We have operating leases for office space and data centers. We use the office space for our business operations, sales, support and product development. Operating lease costs were $11.1 million and $22.4 million , excluding short-term leases and sublease income, which were immaterial, during the three and six months ended July 31, 2019 , respectively. Rent expense recognized prior to our adoption of Topic 842 was $6.1 million and $12.2 million during the three and six months ended July 31, 2018 , respectively. Our lease term and the discount rate related to our operating lease right-of-use assets and related lease liabilities are as follows: July 31, 2019 Weighted-average remaining lease term (in years) 7.69 Weighted-average discount rate 5.98 % As of July 31, 2019 , the maturity of lease liabilities under our non-cancelable operating leases were as follows: Fiscal Period (In thousands) Future Payments (1) Remaining fiscal 2020 $ 20,454 Fiscal 2021 44,163 Fiscal 2022 43,169 Fiscal 2023 38,581 Fiscal 2024 29,114 Thereafter 117,940 Total lease payments 293,421 Less imputed interest (60,642 ) Total current and non-current operating lease liabilities (2) $ 232,779 _________________________ (1) Amounts based on Topic 842, Leases, which we adopted on February 1, 2019. (2) The current portion of our operating lease liabilities is included in “Accrued expenses and other liabilities” on our condensed consolidated balance sheets. As of July 31, 2019 , we have entered into leases, primarily for office space that have not yet commenced, with future lease payments of $249.8 million that are not reflected in the above. These leases will commence between fiscal 2020 to 2021 with non-cancelable lease terms of 2 to 12 years. Prior to our adoption of Topic 842, we entered into a lease which was accounted for under build-to-suit lease accounting. As of January 31, 2019, $76.2 million of our build-to-suit lease asset was included in “Property and equipment, net” and the related $83.4 million financing lease obligation was included in “Other liabilities, non-current” on our condensed consolidated balance sheets. Upon the adoption of Topic 842, we derecognized our build-to-suit asset and related liabilities and recorded the difference of $7.2 million as a decrease to accumulated deficit at February 1, 2019. Under Topic 842, this lease was classified as an operating lease and was included within the operating lease right-of-use assets and liabilities on our condensed consolidated balance sheets as of July 31, 2019 . As of January 31, 2019 , future minimum rental payments under our non-cancelable operating leases obligation were as follows: Fiscal Period (In thousands) Future Payments (1) Fiscal 2020 $ 30,976 Fiscal 2021 48,195 Fiscal 2022 48,126 Fiscal 2023 44,018 Fiscal 2024 40,636 Thereafter 253,856 Total future minimum lease payments (2) $ 465,807 _________________________ (1) Amounts based on Topic 840, Leases. (2) We entered into sublease agreements for portions of our office space and the future rental income of $2.3 million from these agreements have been included as an offset to our future minimum rental payments. Supplemental Disclosures Six Months Ended (In thousands) July 31, 2019 Cash paid for operating lease liabilities $ 19,253 Operating lease liabilities arising from obtaining right-of-use assets 31,238 |
Property and Equipment
Property and Equipment | 6 Months Ended |
Jul. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and Equipment Property and equipment are stated at cost, net of accumulated depreciation and amortization. These assets are depreciated and amortized using the straight-line method over their estimated useful lives. Property and equipment consisted of the following: (In thousands) July 31, 2019 January 31, 2019 Computer equipment and software $ 85,564 $ 79,887 Furniture and fixtures 19,669 18,872 Leasehold and building improvements (1) 97,941 79,064 Building (2) — 82,250 Property and equipment, gross 203,174 260,073 Less: accumulated depreciation and amortization (108,305 ) (101,797 ) Property and equipment, net $ 94,869 $ 158,276 _________________________ (1) Includes costs related to assets not yet placed into service of $28.9 million and $11.3 million , as of July 31, 2019 and January 31, 2019 , respectively. (2) This relates to the capitalization of construction costs under ASC Topic 840, Leases, in connection with our financing lease obligation, where we were considered the owner of the asset, for accounting purposes only, during the period ended January 31, 2019 . The corresponding long-term liability for this obligation is included in our condensed consolidated balance sheets under “Other liabilities, non-current.” As part of our adoption of Topic 842, we derecognized the assets and liabilities related to the financing lease obligation at February 1, 2019. Refer to Note 4 “Leases” for details. Depreciation and amortization expense on Property and equipment, net was $6.6 million and $6.5 million for the three months ended July 31, 2019 and 2018 , respectively, and $12.9 million and $13.1 million for the six months ended July 31, 2019 and 2018 , respectively. Geographic Information The following table presents our property and equipment, net of depreciation and amortization, by geographic region: (In thousands) July 31, 2019 January 31, 2019 United States $ 82,605 $ 147,659 International 12,264 10,617 Total property and equipment, net $ 94,869 $ 158,276 Other than the United States, no other country represented 10% or more of our total property and equipment as of July 31, 2019 or January 31, 2019 |
Acquisitions, Goodwill and Inta
Acquisitions, Goodwill and Intangible Assets | 6 Months Ended |
Jul. 31, 2019 | |
Business Combinations [Abstract] | |
Acquisition, Goodwill and Intangible Assets | Acquisitions, Goodwill and Intangible Assets VictorOps On June 22, 2018, we acquired 100% of the voting equity interest of VictorOps, Inc. (“VictorOps”), a privately-held Delaware corporation that develops incident management solutions for the IT and DevOps markets. This acquisition has been accounted for as a business combination. The purchase price of $112.3 million , paid in cash of $108.8 million and $3.5 million in fair value of replacement equity awards attributable to pre-acquisition service, was allocated as follows: $21.1 million to identified intangible assets, $1.7 million to net assets acquired, with the excess $89.5 million of the purchase price over the fair value of net tangible and intangible assets acquired recorded as goodwill, allocated to our one operating segment. Goodwill is primarily attributable to the value expected from the synergies of the combination, including combined selling opportunities with our products. This goodwill is not deductible for income tax purposes. The results of operations of VictorOps, which are not material, have been included in our condensed consolidated financial statements from the date of purchase. Additionally, we recognized $2.7 million of acquisition-related costs as general and administrative expense on our condensed consolidated statements of operations. Per the terms of the merger agreement with VictorOps, certain unvested stock options held by VictorOps employees were canceled and exchanged for replacement stock options to purchase shares of our common stock under our 2012 Equity Incentive Plan. Additionally, certain shares of stock issued under share-based compensation awards held by key employees of VictorOps were canceled and exchanged for unregistered restricted shares of our common stock subject to vesting. The portion of the fair value of the replacement equity awards associated with pre-acquisition service of VictorOps employees represented a component of the total purchase consideration, as discussed above. The remaining fair value of $7.6 million of these issued awards, which are subject to the recipients’ continued service with us and was excluded from the purchase price, will be recognized ratably as stock-based compensation expense over the required service period. The following table sets forth the components of identifiable intangible assets acquired and their estimated useful lives as of the date of acquisition: (In thousands, except useful life) Fair Value Useful Life (months) Developed technology $ 11,700 84 Customer relationships 9,400 60 Total intangible assets acquired $ 21,100 Phantom On April 6, 2018, we acquired 100% of the voting equity interest of Phantom Cyber Corporation (“Phantom”), a privately-held Delaware corporation that develops solutions for security orchestration, automation and response. This acquisition has been accounted for as a business combination. The purchase price of $303.8 million , paid in cash of $291.5 million and $12.3 million in fair value of replacement equity awards attributable to pre-acquisition service, was allocated as follows: $44.1 million to identified intangible assets, $10.5 million to net assets acquired, $3.3 million to net deferred tax liability, with the excess $252.5 million of the purchase price over the fair value of net tangible and intangible assets acquired recorded as goodwill, allocated to our one operating segment. Goodwill is primarily attributable to the value expected from the synergies of the combination, including combined selling opportunities with our products. This goodwill is not deductible for income tax purposes. The results of operations of Phantom, which are not material, have been included in our condensed consolidated financial statements from the date of purchase. Additionally, we recognized $3.3 million of acquisition-related costs as general and administrative expense on our condensed consolidated statements of operations. Per the terms of the merger agreement with Phantom, certain shares of stock issued under share-based compensation awards held by key employees of Phantom were canceled and exchanged for replacement equity awards consisting of unregistered restricted shares of our common stock subject to vesting. The portion of the fair value of the replacement equity awards associated with pre-acquisition service of Phantom’s key employees represented a component of the total purchase consideration, as discussed above. The remaining fair value of $62.2 million of these issued awards, which are subject to the recipients’ continued service with us and thus excluded from the purchase price, will be recognized ratably as stock-based compensation expense over the required service period. The following table sets forth the components of identifiable intangible assets acquired and their estimated useful lives as of the date of acquisition: (In thousands, except useful life) Fair Value Useful Life (months) Developed technology $ 34,400 84 Customer relationships 9,700 60 Total intangible assets acquired $ 44,100 Goodwill There were no impairments to goodwill during the six months ended July 31, 2019 or during prior periods. Intangible Assets Intangible assets subject to amortization realized from acquisitions as of July 31, 2019 are as follows: (In thousands, except useful life) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Weighted-Average Remaining Useful Life (months) Developed technology $ 132,100 $ (69,394 ) $ 62,706 49 Customer relationships 20,910 (6,433 ) 14,477 46 Other acquired intangible assets 3,270 (3,036 ) 234 4 Total intangible assets subject to amortization $ 156,280 $ (78,863 ) $ 77,417 Intangible assets subject to amortization realized from acquisitions as of January 31, 2019 are as follows: (In thousands, except useful life) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Weighted-Average Remaining Useful Life (months) Developed technology $ 132,100 $ (57,596 ) $ 74,504 52 Customer relationships 20,910 (4,523 ) 16,387 52 Other acquired intangible assets 3,270 (2,539 ) 731 9 Total intangible assets subject to amortization $ 156,280 $ (64,658 ) $ 91,622 Amortization expense from acquired intangible assets was $7.1 million and $6.3 million for the three months ended July 31, 2019 and 2018 , respectively, and $14.2 million and $11.0 million for the six months ended July 31, 2019 and 2018 , respectively. The expected future amortization expense for acquired intangible assets as of July 31, 2019 is as follows: Fiscal Period (In thousands) Expected Amortization Expense Remaining fiscal 2020 $ 13,737 Fiscal 2021 23,780 Fiscal 2022 13,701 Fiscal 2023 10,406 Fiscal 2024 7,692 Thereafter 8,101 Total amortization expense $ 77,417 |
Convertible Senior Notes
Convertible Senior Notes | 6 Months Ended |
Jul. 31, 2019 | |
Debt Disclosure [Abstract] | |
Convertible Senior Notes | Convertible Senior Notes In September 2018, we issued $1.27 billion aggregate principal amount of 0.50% Convertible Senior Notes due 2023 (the “2023 Notes”), including the exercise in full by the initial purchasers of the 2023 Notes of their option to purchase an additional $165.0 million principal amount of 2023 Notes, and $862.5 million aggregate principal amount of 1.125% Convertible Senior Notes due 2025 (the “2025 Notes” and, together with the 2023 Notes, the “Notes”), including the exercise in full by the initial purchasers of the 2025 Notes of their option to purchase an additional $112.5 million principal amount of 2025 Notes. The Notes are general senior, unsecured obligations of Splunk. The total proceeds from the issuance of the Notes was $2.11 billion , net of initial purchaser discounts and issuance costs. The 2023 Notes will mature on September 15, 2023, and the 2025 Notes will mature on September 15, 2025, in each case unless earlier redeemed, repurchased or converted. The 2023 Notes will bear interest from September 21, 2018 at a rate of 0.50% per year and the 2025 Notes will bear interest from September 21, 2018 at a rate of 1.125% per year, in each case payable semiannually in arrears on March 15 and September 15 of each year, beginning on March 15, 2019. The initial conversion rate for each series of notes is 6.7433 shares of our common stock per $1,000 principal amount of Notes, which is equivalent to an initial conversion price of approximately $148.30 per share of our common stock, subject to adjustment upon the occurrence of specified events. The initial conversion price of each series of Notes represents a premium of approximately 27.5% to the $116.31 per share closing price of our common stock on September 18, 2018, which was the date the pricing of the Notes was determined. The Notes will be convertible at the option of the holders at any time prior to the close of business on the business day immediately preceding June 15, 2023, in the case of the 2023 Notes, or June 15, 2025, in the case of the 2025 Notes, only under the following circumstances: • during any fiscal quarter commencing after the fiscal quarter ending on January 31, 2019 (and only during such fiscal quarter), if the last reported sale price of our common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding fiscal quarter is greater than or equal to 130% of the conversion price for the relevant series of Notes on each applicable trading day; • during the five business day period after any 10 consecutive trading day period (the “measurement period”) in which the trading price (as defined in the indenture governing the relevant series of notes) per $1,000 principal amount of the relevant 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 conversion rate for the relevant series of Notes on each such trading day; • if we call the relevant series of Notes for redemption, at any time prior to the close of business on the scheduled trading day immediately preceding the redemption date; or • upon the occurrence of specified corporate events as set forth in the relevant indenture. On or after June 15, 2023, in the case of the 2023 Notes, and on or after June 15, 2025, in the case of the 2025 Notes, until the close of business on the second scheduled trading day immediately preceding the relevant maturity date, holders of the relevant series of Notes may convert all or any portion of their Notes of such series, in multiples of $1,000 principal amount, at the option of the holder regardless of the foregoing circumstances. Upon conversion, we may satisfy our conversion obligation by paying and/or delivering, as the case may be, cash, shares of our common stock or a combination of cash and shares of our common stock, at our election, in the manner and subject to the terms and conditions provided in the relevant indenture. It is our current intent to settle the conversions of principal amount of the Notes in cash and the remaining conversion value, if any, in shares of common stock. If we undergo a fundamental change (as defined in each indenture), holders may require us to repurchase for cash all or any portion of their Notes of the relevant series at a fundamental change repurchase price equal to 100% of the principal amount of the relevant series of Notes to be repurchased, plus accrued and unpaid interest to, but excluding, the fundamental change repurchase date. In addition, following certain corporate events that occur prior to the relevant maturity date of a series of Notes or if we deliver a notice of redemption in respect of a series of Notes, we will, in certain circumstances, increase the conversion rate of the relevant series of Notes for a holder who elects to convert its Notes of the applicable series in connection with such corporate event or notice of redemption, as the case may be. During the three months ended July 31, 2019 , the conditions allowing holders of the Notes to convert were not met. The Notes were therefore not convertible during the three months ended July 31, 2019 and were classified as long-term debt on our condensed consolidated balance sheets. We may not redeem the 2023 Notes prior to September 20, 2021, and we may not redeem the 2025 Notes prior to September 20, 2022. We may redeem for cash all or any portion of the 2023 Notes, at our option, on or after September 20, 2021, and we may redeem for cash all or any portion of the 2025 Notes, at our option, on or after September 20, 2022, in each case if the last reported sale price of our common stock has been at least 130% of the conversion price for the relevant series of Notes then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which we provide notice of redemption at a redemption price equal to 100% of the principal amount of the relevant series of Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the relevant redemption date. In accounting for the issuance of the Notes, we separated the Notes into liability and equity components. The carrying amounts of the liability components of the Notes were calculated by measuring the fair value of similar debt instruments that do not have an associated convertible feature. The carrying amounts of the equity components, representing the conversion option, were determined by deducting the fair value of the liability components from the par value of the respective Notes. This difference represents the debt discount that is amortized to interest expense over the respective terms of the Notes using the effective interest rate method. The carrying amounts of the equity components representing the conversion options were $266.9 million and $237.2 million for the 2023 Notes and 2025 Notes, respectively, and are recorded in additional paid-in capital and are not remeasured as long as they continue to meet the conditions for equity classification. In accounting for the issuance costs related to the Notes, we allocated the total amount incurred to the liability and equity components of the Notes based on the proportion of the proceeds allocated to the debt and equity components. Issuance costs attributable to the liability component of the 2023 Notes and 2025 Notes were $10.4 million and $6.5 million , respectively. The issuance costs allocated to the liability component are amortized to interest expense over the contractual terms of the 2023 Notes and 2025 Notes at an effective interest rate of 5.65% and 6.22% , respectively. Issuance costs attributable to the equity component of the 2023 Notes and 2025 Notes were $2.8 million and $2.5 million , respectively, and are netted against the equity components representing the conversion option in additional paid-in capital. The net carrying amount of the liability and equity components for each of the Notes as of July 31, 2019 was as follows: (In thousands) 2023 Notes 2025 Notes Liability component: Principal amount $ 1,265,000 $ 862,500 Unamortized discount (226,046 ) (213,196 ) Unamortized issuance costs (8,822 ) (5,867 ) Net carrying amount $ 1,030,132 $ 643,437 Equity component, net of purchase discounts and issuance costs $ 264,129 $ 234,712 The following table sets forth the interest expense related to the Notes: Three Months Ended Six Months Ended (In thousands) July 31, 2019 July 31, 2019 2023 Notes: Coupon interest expense $ 1,581 $ 3,162 Amortization of debt discount (conversion option) 12,218 23,813 Amortization of debt issuance costs and purchase discounts 477 930 Total interest expense related to the 2023 Notes $ 14,276 $ 27,905 2025 Notes: Coupon interest expense $ 2,426 $ 4,852 Amortization of debt discount (conversion option) 7,197 13,968 Amortization of debt issuance costs and purchase discounts 198 384 Total interest expense related to the 2025 Notes $ 9,821 $ 19,204 As of July 31, 2019 , the total estimated fair values of the 2023 Notes and the 2025 Notes were approximately $1.45 billion and $1.01 billion , 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. The fair value of the Notes is primarily affected by the trading price of our common stock and market interest rates. The fair value of the Notes is considered a Level 2 measurement as they are not actively traded. Capped Calls In connection with the issuance of the Notes, including the initial purchasers’ exercise of the option to purchase additional Notes, we entered into privately negotiated capped call transactions with certain counterparties (the “Capped Calls”). The Capped Calls are expected to reduce potential dilution to our common stock upon conversion of the Notes and/or offset any cash payments that we are required to make in excess of the principal amount of converted Notes, as the case may be, with such reduction and/or offset subject to a cap. The Capped Calls have an initial strike price of $148.30 per share, subject to certain adjustments, which corresponds to the conversion option strike price in the Notes. The Capped Calls have a cap price equal to $232.62 per share, subject to certain adjustments. The Capped Calls are subject to adjustment upon the occurrence of specified extraordinary events affecting us, including merger events, tender offers and announcement events. In addition, the Capped Calls are subject to certain specified additional disruption events that may give rise to a termination of the Capped Calls, including nationalization, insolvency or delisting, changes in law, failures to deliver, insolvency filings and hedging disruptions. For accounting purposes, the Capped Calls are separate transactions, and not part of the terms of the Notes. As these transactions meet certain accounting criteria, the Capped Calls are recorded in stockholders’ equity and are not accounted for as derivatives. The premium paid for the purchase of the Capped Calls in the amount of $274.3 million |
Stock Compensation Plans
Stock Compensation Plans | 6 Months Ended |
Jul. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Stock Compensation Plans | Stock Compensation Plans The following table summarizes the stock option, restricted stock unit (“RSU”) and performance unit (“PSU”) award activity during the six months ended July 31, 2019 : Options Outstanding RSUs and PSUs Outstanding Shares Available for Grant Shares Weighted- Average Exercise Price Per Share Weighted- Average Remaining Contractual Term Aggregate Intrinsic Value (1) Shares (in years) (in thousands) Balances as of January 31, 2019 17,082,136 409,039 $ 10.69 3.36 $ 46,693 13,098,607 Additional shares authorized 7,458,364 Options exercised (78,891 ) 7.03 Options forfeited and expired 4,337 (4,337 ) 21.43 RSUs and PSUs granted (2,318,860 ) 2,318,860 RSUs and PSUs vested (2,656,767 ) Shares withheld related to net share settlement of RSUs and PSUs 962,311 RSUs and PSUs forfeited and canceled 858,828 (858,828 ) Balances as of July 31, 2019 24,047,116 325,811 $ 11.43 2.80 $ 40,362 11,901,872 Vested and expected to vest 325,675 $ 11.42 2.80 $ 40,349 11,127,822 Exercisable as of July 31, 2019 315,355 $ 10.94 2.62 $ 39,221 _________________________ (1) The intrinsic value is calculated as the difference between the exercise price of the underlying stock option award and the closing market price of our common stock as of July 31, 2019 . Beginning in fiscal 2016, we have granted PSUs to certain executives under our 2012 Equity Incentive Plan, which includes both PSUs awarded but not yet earned, as well as PSUs earned and eligible to vest. The number of PSUs earned and eligible to vest will be determined after a one-year performance period, based on achievement of certain company financial performance measures and the recipient’s continued service with us. The number of shares of our stock to be received based on financial performance measures can range from 0% to 200% of the target amount. Compensation expense for PSUs with financial performance measures is measured using the fair value at the date of grant and recorded over the four-year vesting period under the graded-vesting attribution method, and may be adjusted over the vesting period based on interim estimates of performance against the pre-set objectives. Additionally, beginning in fiscal 2019, our PSUs granted contain an additional market performance measure that can increase the number of shares earned by up to an additional 50% of the shares received based on the financial performance measure. As of July 31, 2019 , total unrecognized compensation cost related to stock options was $0.8 million , which is expected to be recognized over a weighted-average period of 1.0 year . As of July 31, 2019 , total unrecognized compensation cost was $862.3 million related to RSUs, which is expected to be recognized over the next 2.7 years . As of July 31, 2019 , total unrecognized compensation cost was $77.3 million related to PSUs, which is expected to be recognized over the next 2.6 years . The aggregate intrinsic value of options exercised during the six months ended July 31, 2019 was $9.5 million . The weighted-average grant date fair value of RSUs granted was $129.68 per share during the six months ended July 31, 2019 . The weighted-average grant date fair value of PSUs granted was $168.11 per share during the six months ended July 31, 2019 . The following table summarizes our restricted stock award (“RSA”) activity during the six months ended July 31, 2019 : Shares Outstanding as of January 31, 2019 824,605 RSAs vested (379,393 ) Outstanding as of July 31, 2019 445,212 As of July 31, 2019 , total unrecognized compensation cost related to RSAs was $31.8 million , which is expected to be recognized over the next 1.6 years |
Revenues, Deferred Revenue and
Revenues, Deferred Revenue and Remaining Performance Obligations | 6 Months Ended |
Jul. 31, 2019 | |
Segment Reporting [Abstract] | |
Revenues, Deferred Revenue and Remaining Performance Obligations | Revenues, Deferred Revenue and Remaining Performance Obligations Disaggregation of Revenues The following table presents disaggregated revenues by major product or service type: Three Months Ended July 31, Six Months Ended July 31, (In thousands) 2019 2018 2019 2018 Revenues License $ 279,279 $ 200,668 $ 482,141 $ 339,643 Maintenance, professional services and training 166,828 148,570 326,761 287,688 Cloud services 70,451 39,065 132,506 72,611 Total revenues $ 516,558 $ 388,303 $ 941,408 $ 699,942 Revenues by geography are based on the shipping address of the customer. The following table presents our revenues by geographic region: Three Months Ended July 31, Six Months Ended July 31, (In thousands) 2019 2018 2019 2018 United States $ 352,210 $ 267,201 $ 664,566 $ 494,643 International 164,348 121,102 276,842 205,299 Total revenues $ 516,558 $ 388,303 $ 941,408 $ 699,942 Other than the United States, no other individual country exceeded 10% of total revenues during any of the periods presented. One channel partner represented 30% and 33% of total revenues for the three months ended July 31, 2019 and 2018 , respectively, and 31% for both the six months ended July 31, 2019 and 2018 . A second channel partner represented 17% and 16% of total revenues during the three months ended July 31, 2019 and 2018 , respectively, and 18% and 15% for the six months ended July 31, 2019 and 2018 , respectively. The revenues from these channel partners are comprised of a number of customer transactions, none of which were individually greater than 10% of total revenues for the three or six months ended July 31, 2019 or 2018 . As of July 31, 2019 , one channel partner represented 22% and a second channel partner represented 11% of total current and non-current accounts receivable. As of January 31, 2019 , one channel partner represented 29% and a second channel partner represented 10% of total current and non-current accounts receivable. Total current and non-current accounts receivable, net of allowance for doubtful accounts, was $659.9 million and $625.1 million as of July 31, 2019 and January 31, 2019 , respectively. Deferred Revenue Revenues recognized from amounts included in deferred revenue as of January 31, 2019 and 2018 were $395.1 million and $279.2 million during the six months ended July 31, 2019 and 2018 , respectively. Remaining Performance Obligations Revenue allocated to remaining performance obligations represents contracted revenue that has not yet been recognized, which includes deferred revenue and non-cancelable amounts that will be invoiced and excludes performance obligations that are subject to cancellation terms. Our remaining performance obligations were $1.24 billion as of July 31, 2019 , of which we expect to recognize approximately 61% as revenue over the next 12 months and the remainder thereafter. |
Income Taxes
Income Taxes | 6 Months Ended |
Jul. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes For the three months ended July 31, 2019 and 2018 , we recorded income tax expense of $5.6 million and $0.8 million , respectively. The increase in income tax expense for the three months ended July 31, 2019 was primarily due to an increase in federal tax expense as a result of the Base Erosion Anti-Abuse Tax (“BEAT”). For the six months ended July 31, 2019 and 2018 , we recorded an income tax expense of $8.9 million and an income tax benefit of $1.2 million , respectively. The increase in income tax expense for the six months ended July 31, 2019 was primarily due to an increase in federal tax expense as a result of BEAT and the absence of the partial release of the valuation allowance as a result of a prior year acquisition. During the three months ended July 31, 2019 , there were no material changes to our unrecognized tax benefits, and we do not expect to have any significant changes to unrecognized tax benefits through the end of the fiscal year. Because of our history of tax losses, all years remain open to tax audit. |
Net Loss Per Share
Net Loss Per Share | 6 Months Ended |
Jul. 31, 2019 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | Net Loss Per Share Basic net loss per share is computed by dividing the net loss by the weighted-average number of shares of common stock outstanding during the period, less the weighted-average unvested common stock subject to repurchase or forfeiture. Diluted net loss per share is computed by giving effect to all potential shares of common stock, including convertible senior notes, preferred stock, stock options, RSUs, PSUs and RSAs to the extent dilutive. The following table sets forth the computation of historical basic and diluted net loss per share: Three Months Ended July 31, Six Months Ended July 31, (In thousands, except per share amounts) 2019 2018 2019 2018 Numerator: Net loss $ (100,872 ) $ (103,499 ) $ (256,301 ) $ (221,998 ) Denominator: Weighted-average common shares outstanding 150,812 145,851 150,283 144,361 Less: Weighted-average unvested common shares subject to repurchase or forfeiture (506 ) (821 ) (560 ) (55 ) Weighted-average shares used to compute net loss per share, basic and diluted 150,306 145,030 149,723 144,306 Net loss per share, basic and diluted $ (0.67 ) $ (0.71 ) $ (1.71 ) $ (1.54 ) Since we were in a net loss position for all periods presented, basic net loss per share is the same as diluted net loss per share for all periods as the inclusion of all potentially dilutive securities outstanding would have been anti-dilutive. Potentially dilutive securities that were not included in the diluted per share calculations because they would be anti-dilutive were as follows: As of July 31, (In thousands) 2019 2018 Shares subject to outstanding common stock options 326 483 Shares subject to outstanding RSUs, PSUs and RSAs 12,347 13,550 Employee stock purchase plan 342 371 Total 13,015 14,404 As we expect to settle the principal amount of our convertible senior notes in cash, we use the treasury stock method for calculating any potential dilutive effect on diluted net income per share, if applicable. The conversion spread of 14.3 million shares will have a dilutive impact on diluted net income per share of common stock when the average market price of our common stock for a given period exceeds the conversion price of $148.30 per share. |
Subsequent Event
Subsequent Event | 6 Months Ended |
Jul. 31, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Event | Subsequent Events On August 21, 2019, we entered into a definitive agreement to acquire SignalFx, Inc., a privately-held Delaware corporation, a developer of real-time monitoring and metrics for cloud infrastructure, microservices and applications, in exchange for total consideration of approximately $1.05 billion , subject to adjustment, to be paid approximately 60% in cash and 40% in our common stock. On August 30, 2019, we entered into a definitive agreement to acquire Cloud Native Labs, Inc. (“Omnition”), a privately-held Delaware corporation, which develops a platform for distributed tracing and application monitoring, in exchange for total consideration of approximately $90.0 million , subject to adjustment, to be paid approximately 40% in cash and 60% in our common stock. The acquisitions will be accounted for as business combinations and accordingly, the total purchase price will be allocated to the tangible and intangible assets acquired and the liabilities assumed based on their respective fair values on the acquisition date. We have not yet determined the purchase price allocation for the transactions. The acquisitions are expected to close during the second half of fiscal 2020, subject to customary closing conditions and regulatory reviews. |
Description of the Business a_2
Description of the Business and Significant Accounting Policies (Policies) | 6 Months Ended |
Jul. 31, 2019 | |
Accounting Policies [Abstract] | |
Business Description and Basis of Presentation | Business Splunk Inc. (“we,” “us,” “our”) provides innovative software solutions that enable organizations to gain real-time operational intelligence by harnessing the value of their data. Our offerings enable users to investigate, monitor, analyze and act on machine data regardless of format or source. Our offerings address large and diverse data sets commonly referred to as big data and are specifically tailored for machine data. Machine data is produced by nearly every software application and electronic device across an organization and contains a real-time record of various activities, such as transactions, customer and user behavior, and security threats. Our offerings help users derive new insights from machine data that can be used to, among other things, improve service levels, reduce operational costs, mitigate security risks, demonstrate and maintain compliance, and drive better business decisions. We were incorporated in California in October 2003 and reincorporated in Delaware in May 2006. |
Fiscal Year | Fiscal Year Our fiscal year ends on January 31. References to fiscal 2020, for example, refer to the fiscal year ending January 31, 2020. |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. The condensed consolidated balance sheet data as of January 31, 2019 was derived from audited financial statements, but does not include all disclosures required by GAAP. Therefore, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the Annual Report on Form 10-K for the fiscal year ended January 31, 2019 , filed with the SEC on March 27, 2019 . In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all normal recurring adjustments necessary to state fairly the financial position, results of operations, comprehensive loss and cash flows for the interim periods, but are not necessarily indicative of the results of operations to be anticipated for the full fiscal 2020 . |
Reclassifications | Reclassifications Certain reclassifications have been made to prior year balances in order to conform to the current period presentation. “Interest income” and “Interest expense” have been reclassified from “Interest income (expense), net” on the condensed consolidated statements of operations. These reclassifications had no impact on the previously reported net loss or accumulated deficit. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting periods covered by the financial statements and accompanying notes. In particular, we make estimates with respect to the stand-alone selling price for each distinct performance obligation included in customer contracts with multiple performance obligations, uncollectible accounts receivable, the assessment of the useful life and recoverability of long-lived assets (property and equipment, goodwill and identified intangibles), the period of benefit for deferred commissions, stock-based compensation expense, the fair value of assets acquired and liabilities assumed for business combinations, income taxes, the discount rate used for operating leases, and contingencies. Actual results could differ from those estimates. |
Segments | Segments We operate our business as one operating segment: the development and marketing of software solutions that enable our customers to gain real-time operational intelligence by harnessing the value of their data. Our chief operating decision maker is our Chief Executive Officer, who reviews financial information presented on a consolidated basis for purposes of making operating decisions, assessing financial performance and allocating resources. |
Principles of Consolidation | Principles of Consolidation The accompanying unaudited condensed consolidated financial statements include the accounts of Splunk Inc. and its direct and indirect wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated upon consolidation. |
Leases | Leases We determine if an arrangement contains a lease and the classification of that lease, if applicable, at the inception of a contract. We primarily lease our facilities under operating leases. Operating lease right-of-use assets and liabilities are recognized at the present value of the future lease payments at the lease commencement date. We calculate the operating lease right-of-use assets based on the corresponding lease liability adjusted for (i) payments made at or before the commencement date, (ii) initial direct costs we incur and (iii) tenant incentives under the lease. We do not account for renewals or early terminations unless we are reasonably certain to exercise these options at commencement. Operating lease expense is recognized on a straight-line basis over the lease term. We account for lease and non-lease components as a single lease component for our operating leases. We do not record leases with terms of 12 months or less on our condensed consolidated balance sheets. As the implicit rate for our operating leases is generally not determinable, we use our incremental borrowing rate as our discount rate at the lease commencement date to determine the present value of lease payments. We determine the discount rate of our leases by considering various factors, such as our credit rating, interest rates of similar debt instruments of entities with comparable credit ratings, the lease term and the currency in which the lease is denominated. Our discount rate was determined using a portfolio approach. Our operating lease assets are included in “Operating lease right-of-use assets” and the current and non-current portions of our operating lease liabilities are included in “Accrued expenses and other liabilities” and “Operating lease liabilities,” respectively, on our condensed consolidated balance sheets. As of July 31, 2019 , we had no finance leases. Refer to Note 4 “Leases” for details. |
Foreign Currency | Foreign Currency The functional currency of our foreign subsidiaries is their respective local currency, with the exception of our United Kingdom subsidiary, in which the functional currency is the U.S. dollar. Translation adjustments arising from the use of differing exchange rates from period to period are included in “Accumulated other comprehensive income (loss)” within the condensed consolidated statements of stockholders’ equity. Foreign currency transaction gains and losses are included in “Other income (expense), net.” All assets and liabilities denominated in a foreign currency are translated into U.S. dollars at the exchange rate on the balance sheet date. Expenses are translated at the average exchange rate during the period. Equity transactions are translated using historical exchange rates. |
Revenue Recognition | Revenue Recognition We generate revenues primarily in the form of software license and related maintenance fees, cloud services and other service fees. Licenses for on-premises software are either term or perpetual licenses and provide the customer with a right to use the software. When a term license is purchased, maintenance is bundled with the license for the term of the license period. Typically, when purchasing a perpetual license, a customer also purchases one year of maintenance for which we charge a percentage of the license fee. Cloud services are provided on a subscription basis and give our customers access to our cloud solutions, which include related customer support. Other services include training and professional services that are not integral to the functionality of the licenses or cloud services. Revenue from on-premises licenses is generally recognized upfront upon transfer of control of the software, which occurs at delivery, or when the license term commences, if later. We recognize revenue from maintenance contracts ratably over the service period. Cloud services revenue is recognized ratably over the cloud service term. Training and professional services are provided either on a time and material basis, in which revenues are recognized as services are delivered, or over a contractual term, in which revenues are recognized ratably. With respect to contracts that include customer acceptance provisions, we recognize revenue upon customer acceptance. Our policy is to record revenues net of any applicable sales, use or excise taxes. Our contracts with customers often contain multiple performance obligations. For these contracts, we account for individual performance obligations separately if they are distinct. The transaction price is allocated to the separate performance obligations on a relative standalone selling price (“SSP”) basis. We determine the SSP based on an observable standalone selling price when it is available, as well as other factors, including the price charged to customers, our discounting practices, and our overall pricing objectives, while maximizing observable inputs. In situations where pricing is highly variable, we estimate the SSP using the residual approach. A receivable is recorded in the period we deliver products or provide services, or when we have an unconditional right to payment. Most of our multi-year on-premises term license contracts are invoiced annually and we generally recognize the total amount of the license revenues upfront and record a corresponding receivable, if we have an unconditional right to receive payment. Payment terms and conditions vary by contract type, although our terms generally include a requirement of payment within 30 to 60 days. In instances where the timing of revenue recognition differs from the timing of payment, we have determined our contracts do not include a significant financing component. The primary purpose of our invoicing terms is to provide customers with simplified and predictable ways of purchasing our products and services, not to receive financing from our customers or to provide customers with financing. Deferred revenue is recorded when we invoice a contract or deliver a license prior to recognizing revenue. It is comprised of balances related to maintenance, cloud services, training and professional services invoiced at the beginning of each service period, as well as for licenses that we delivered prior to the license term commencing. |
New Accounting Pronouncements | Recently Adopted Accounting Standards Standard Description Effective Date Effect on the Condensed Consolidated Financial Statements (or Other Significant Matters) Accounting Standards Update (“ASU”) No. 2018-15 (Subtopic 350-40), Intangibles - Goodwill and Other - Internal-Use Software: Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract The standard aligns the requirements for capitalizing implementation costs in a cloud computing arrangement with the requirements for capitalizing implementation costs incurred for an internal-use software license. We early adopted this new standard as of May 1, 2019. The adoption of this new standard did not have a material impact on our condensed consolidated financial statements. ASU No. 2018-13 (Topic 820), Fair Value Measurement: Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement The new standard no longer requires disclosure of the amount and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy, but public companies will be required to disclose the range and weighted-average used to develop significant unobservable inputs for Level 3 fair value measurements. We adopted this new standard as of February 1, 2019. The adoption of this new standard did not have a material impact on our condensed consolidated financial statements. ASU No. 2016-02 (Topic 842), Leases The new standard supersedes the lease recognition requirements in Accounting Standards Codification (“ASC”) Topic 840, Leases. The standard requires an entity to recognize right-of-use assets and lease liabilities arising from a lease for operating leases, initially measured at the present value of the lease payments on the condensed consolidated balance sheets. The impact of such leases on the condensed consolidated statements of operations and cash flows will continue to be treated in a similar manner under current GAAP. The standard also requires additional qualitative and quantitative disclosures. In July 2018, ASU No. 2018-10, Codification Improvements to Topic 842, Leases, was issued which clarifies the codification or corrects unintended application of the guidance. We adopted this new standard as of February 1, 2019, using the cumulative-effect transition method recognized as of the date of initial application, as amended by ASU No. 2018-11. Under this method, we are not required to restate or disclose the effects of applying Topic 842 for comparative periods. As the result of our adoption, we recognized Operating lease right-of-use assets of $199.8 million and current and non-current Operating lease liabilities of $211.9 million on our condensed consolidated balance sheets at February 1, 2019. Additionally, we recorded a decrease to our opening accumulated deficit of approximately $7.2 million related to the derecognition of build-to-suit lease assets and liabilities. We have updated our accounting policies, systems, processes and internal controls, and have allocated internal and external resources to assist us during our implementation efforts. We applied the following practical expedients as permitted under Topic 842: (i) we elected to account for lease and non-lease components as a single lease component, and (ii) we elected the package of practical expedients permitted under the transition guidance, which allowed us to carryforward (1) our historical lease classification, (2) our assessment on whether a contract was or contains a lease, and (3) our initial direct costs for leases that existed prior to January 31, 2019. Recently Issued Accounting Pronouncements Standard Description Effective Date Effect on the Condensed Consolidated Financial Statements (or Other Significant Matters) ASU No. 2016-13 (Topic 326), Financial Instruments - Credit Losses The amendments in this update require a financial asset (or a group of financial assets) measured at an amortized cost basis to be presented at the net amount expected to be collected. The new approach to estimating credit losses (referred to as the current expected credit losses model) applies to most financial assets measured at amortized cost and certain other instruments, including trade and other receivables, loans and held-to-maturity debt securities. First quarter of fiscal 2021, although early adoption is permitted. We are currently evaluating whether the adoption of this standard will have a material impact on our condensed consolidated financial statements. |
Description of the Business a_3
Description of the Business and Significant Accounting Policies New Accounting Pronouncements (Tables) | 6 Months Ended |
Jul. 31, 2019 | |
Accounting Policies [Abstract] | |
Schedule of New Accounting Pronouncements and Changes in Accounting Principles | Recently Adopted Accounting Standards Standard Description Effective Date Effect on the Condensed Consolidated Financial Statements (or Other Significant Matters) Accounting Standards Update (“ASU”) No. 2018-15 (Subtopic 350-40), Intangibles - Goodwill and Other - Internal-Use Software: Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract The standard aligns the requirements for capitalizing implementation costs in a cloud computing arrangement with the requirements for capitalizing implementation costs incurred for an internal-use software license. We early adopted this new standard as of May 1, 2019. The adoption of this new standard did not have a material impact on our condensed consolidated financial statements. ASU No. 2018-13 (Topic 820), Fair Value Measurement: Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement The new standard no longer requires disclosure of the amount and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy, but public companies will be required to disclose the range and weighted-average used to develop significant unobservable inputs for Level 3 fair value measurements. We adopted this new standard as of February 1, 2019. The adoption of this new standard did not have a material impact on our condensed consolidated financial statements. ASU No. 2016-02 (Topic 842), Leases The new standard supersedes the lease recognition requirements in Accounting Standards Codification (“ASC”) Topic 840, Leases. The standard requires an entity to recognize right-of-use assets and lease liabilities arising from a lease for operating leases, initially measured at the present value of the lease payments on the condensed consolidated balance sheets. The impact of such leases on the condensed consolidated statements of operations and cash flows will continue to be treated in a similar manner under current GAAP. The standard also requires additional qualitative and quantitative disclosures. In July 2018, ASU No. 2018-10, Codification Improvements to Topic 842, Leases, was issued which clarifies the codification or corrects unintended application of the guidance. We adopted this new standard as of February 1, 2019, using the cumulative-effect transition method recognized as of the date of initial application, as amended by ASU No. 2018-11. Under this method, we are not required to restate or disclose the effects of applying Topic 842 for comparative periods. As the result of our adoption, we recognized Operating lease right-of-use assets of $199.8 million and current and non-current Operating lease liabilities of $211.9 million on our condensed consolidated balance sheets at February 1, 2019. Additionally, we recorded a decrease to our opening accumulated deficit of approximately $7.2 million related to the derecognition of build-to-suit lease assets and liabilities. We have updated our accounting policies, systems, processes and internal controls, and have allocated internal and external resources to assist us during our implementation efforts. We applied the following practical expedients as permitted under Topic 842: (i) we elected to account for lease and non-lease components as a single lease component, and (ii) we elected the package of practical expedients permitted under the transition guidance, which allowed us to carryforward (1) our historical lease classification, (2) our assessment on whether a contract was or contains a lease, and (3) our initial direct costs for leases that existed prior to January 31, 2019. Recently Issued Accounting Pronouncements Standard Description Effective Date Effect on the Condensed Consolidated Financial Statements (or Other Significant Matters) ASU No. 2016-13 (Topic 326), Financial Instruments - Credit Losses The amendments in this update require a financial asset (or a group of financial assets) measured at an amortized cost basis to be presented at the net amount expected to be collected. The new approach to estimating credit losses (referred to as the current expected credit losses model) applies to most financial assets measured at amortized cost and certain other instruments, including trade and other receivables, loans and held-to-maturity debt securities. First quarter of fiscal 2021, although early adoption is permitted. We are currently evaluating whether the adoption of this standard will have a material impact on our condensed consolidated financial statements. |
Investments and Fair Value Me_2
Investments and Fair Value Measurements (Tables) | 6 Months Ended |
Jul. 31, 2019 | |
Investments, Debt and Equity Securities and Fair Value Disclosures [Abstract] | |
Schedule of fair value of financial assets and liabilities that were measured on a recurring basis | The following table sets forth the fair value of our financial assets that were measured on a recurring basis: July 31, 2019 January 31, 2019 (In thousands) Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Assets: Money market funds $ 56,707 $ — $ — $ 56,707 $ 46,311 $ — $ — $ 46,311 U.S. treasury securities — 824,192 — 824,192 — 980,940 — 980,940 Corporate bonds — 149,990 — 149,990 — — — — Commercial paper — 19,869 — 19,869 — — — — Other — — 4,000 4,000 — — 4,744 4,744 Reported as: Assets: Cash and cash equivalents $ 65,004 $ 46,311 Investments, current 903,864 881,220 Investments, non-current 85,890 104,463 Total $ 1,054,758 $ 1,031,994 |
Schedule of available-for-sale securities reconciliation | We invest in U.S. treasury securities, corporate bonds and commercial paper, which we have classified as available-for-sale investments. The following table presents our available-for-sale investments as of July 31, 2019 : (In thousands) Amortized Cost Unrealized Gains Unrealized Losses Fair Value Cash and cash equivalents: U.S. treasury securities $ 8,296 $ 1 $ — $ 8,297 Investments, current: U.S. treasury securities 815,244 821 (170 ) 815,895 Corporate bonds 67,972 132 (4 ) 68,100 Commercial paper 19,847 22 — 19,869 Investments, non-current: Corporate bonds 81,514 379 (3 ) 81,890 Total available-for-sale investments $ 992,873 $ 1,355 $ (177 ) $ 994,051 The following table presents our available-for-sale investments as of January 31, 2019 : (In thousands) Amortized Cost Unrealized Gains Unrealized Losses Fair Value Investments, current: U.S. treasury securities $ 881,206 $ 131 $ (117 ) $ 881,220 Investments, non-current: U.S. treasury securities 99,597 134 (11 ) 99,720 Total available-for-sale investments $ 980,803 $ 265 $ (128 ) $ 980,940 |
Schedule of unrealized loss on investments | The following table presents the fair values and unrealized losses of our available-for-sale investments, classified by length of time that the securities have been in a continuous unrealized loss position: Less than 12 Months 12 Months or Greater Total (In thousands) Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses July 31, 2019 U.S. treasury securities $ 178,703 $ (170 ) $ — $ — $ 178,703 $ (170 ) Corporate bonds 12,512 (7 ) — — 12,512 (7 ) January 31, 2019 U.S. treasury securities $ 582,761 $ (128 ) $ — $ — $ 582,761 $ (128 ) |
Investments classified by contractual maturity date | The contractual maturities of our investments are as follows: (In thousands) July 31, 2019 Due within one year $ 912,161 Due within one to two years 81,890 Total $ 994,051 |
Schedule of equity investments | Our equity investments are reported in “Investments, non-current” on our condensed consolidated balance sheets. The following table provides a summary of our equity investments: (In thousands) July 31, 2019 January 31, 2019 Equity investments without readily determinable fair values $ 6,244 $ 5,000 Equity investments under the equity method of accounting 1,875 1,125 Total $ 8,119 $ 6,125 |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Jul. 31, 2019 | |
Leases [Abstract] | |
Lease, Cost | Our lease term and the discount rate related to our operating lease right-of-use assets and related lease liabilities are as follows: July 31, 2019 Weighted-average remaining lease term (in years) 7.69 Weighted-average discount rate 5.98 % Supplemental Disclosures Six Months Ended (In thousands) July 31, 2019 Cash paid for operating lease liabilities $ 19,253 Operating lease liabilities arising from obtaining right-of-use assets 31,238 |
Maturity of Lease Liabilities | As of July 31, 2019 , the maturity of lease liabilities under our non-cancelable operating leases were as follows: Fiscal Period (In thousands) Future Payments (1) Remaining fiscal 2020 $ 20,454 Fiscal 2021 44,163 Fiscal 2022 43,169 Fiscal 2023 38,581 Fiscal 2024 29,114 Thereafter 117,940 Total lease payments 293,421 Less imputed interest (60,642 ) Total current and non-current operating lease liabilities (2) $ 232,779 _________________________ (1) Amounts based on Topic 842, Leases, which we adopted on February 1, 2019. (2) The current portion of our operating lease liabilities is included in “Accrued expenses and other liabilities” on our condensed consolidated balance sheets. |
Schedule of Future Minimum Rental Payments for Operating Leases | As of January 31, 2019 , future minimum rental payments under our non-cancelable operating leases obligation were as follows: Fiscal Period (In thousands) Future Payments (1) Fiscal 2020 $ 30,976 Fiscal 2021 48,195 Fiscal 2022 48,126 Fiscal 2023 44,018 Fiscal 2024 40,636 Thereafter 253,856 Total future minimum lease payments (2) $ 465,807 _________________________ (1) Amounts based on Topic 840, Leases. (2) We entered into sublease agreements for portions of our office space and the future rental income of $2.3 million from these agreements have been included as an offset to our future minimum rental payments. |
Property and Equipment (Tables)
Property and Equipment (Tables) | 6 Months Ended |
Jul. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and equipment are stated at cost, net of accumulated depreciation and amortization. These assets are depreciated and amortized using the straight-line method over their estimated useful lives. Property and equipment consisted of the following: (In thousands) July 31, 2019 January 31, 2019 Computer equipment and software $ 85,564 $ 79,887 Furniture and fixtures 19,669 18,872 Leasehold and building improvements (1) 97,941 79,064 Building (2) — 82,250 Property and equipment, gross 203,174 260,073 Less: accumulated depreciation and amortization (108,305 ) (101,797 ) Property and equipment, net $ 94,869 $ 158,276 _________________________ (1) Includes costs related to assets not yet placed into service of $28.9 million and $11.3 million , as of July 31, 2019 and January 31, 2019 , respectively. (2) This relates to the capitalization of construction costs under ASC Topic 840, Leases, in connection with our financing lease obligation, where we were considered the owner of the asset, for accounting purposes only, during the period ended January 31, 2019 . The corresponding long-term liability for this obligation is included in our condensed consolidated balance sheets under “Other liabilities, non-current.” As part of our adoption of Topic 842, we derecognized the assets and liabilities related to the financing lease obligation at February 1, 2019. Refer to Note 4 “Leases” for details. |
Long-lived Assets by Geographic Areas [Table Text Block] | The following table presents our property and equipment, net of depreciation and amortization, by geographic region: (In thousands) July 31, 2019 January 31, 2019 United States $ 82,605 $ 147,659 International 12,264 10,617 Total property and equipment, net $ 94,869 $ 158,276 |
Acquisitions, Goodwill and In_2
Acquisitions, Goodwill and Intangible Assets (Tables) | 6 Months Ended |
Jul. 31, 2019 | |
Goodwill [Line Items] | |
Schedule of finite-lived intangible assets | Intangible assets subject to amortization realized from acquisitions as of July 31, 2019 are as follows: (In thousands, except useful life) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Weighted-Average Remaining Useful Life (months) Developed technology $ 132,100 $ (69,394 ) $ 62,706 49 Customer relationships 20,910 (6,433 ) 14,477 46 Other acquired intangible assets 3,270 (3,036 ) 234 4 Total intangible assets subject to amortization $ 156,280 $ (78,863 ) $ 77,417 Intangible assets subject to amortization realized from acquisitions as of January 31, 2019 are as follows: (In thousands, except useful life) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Weighted-Average Remaining Useful Life (months) Developed technology $ 132,100 $ (57,596 ) $ 74,504 52 Customer relationships 20,910 (4,523 ) 16,387 52 Other acquired intangible assets 3,270 (2,539 ) 731 9 Total intangible assets subject to amortization $ 156,280 $ (64,658 ) $ 91,622 |
Schedule of expected future amortization for capitalized computer software costs developed for internal use | The expected future amortization expense for acquired intangible assets as of July 31, 2019 is as follows: Fiscal Period (In thousands) Expected Amortization Expense Remaining fiscal 2020 $ 13,737 Fiscal 2021 23,780 Fiscal 2022 13,701 Fiscal 2023 10,406 Fiscal 2024 7,692 Thereafter 8,101 Total amortization expense $ 77,417 |
VictorOps | |
Goodwill [Line Items] | |
Finite-Lived and Indefinite-Lived Intangible Assets Acquired as Part of Business Combination | The following table sets forth the components of identifiable intangible assets acquired and their estimated useful lives as of the date of acquisition: (In thousands, except useful life) Fair Value Useful Life (months) Developed technology $ 11,700 84 Customer relationships 9,400 60 Total intangible assets acquired $ 21,100 |
Phantom Cyber Corporation | |
Goodwill [Line Items] | |
Finite-Lived and Indefinite-Lived Intangible Assets Acquired as Part of Business Combination | The following table sets forth the components of identifiable intangible assets acquired and their estimated useful lives as of the date of acquisition: (In thousands, except useful life) Fair Value Useful Life (months) Developed technology $ 34,400 84 Customer relationships 9,700 60 Total intangible assets acquired $ 44,100 |
Convertible Senior Notes (Table
Convertible Senior Notes (Tables) | 6 Months Ended |
Jul. 31, 2019 | |
Debt Disclosure [Abstract] | |
Convertible Senior Notes | The net carrying amount of the liability and equity components for each of the Notes as of July 31, 2019 was as follows: (In thousands) 2023 Notes 2025 Notes Liability component: Principal amount $ 1,265,000 $ 862,500 Unamortized discount (226,046 ) (213,196 ) Unamortized issuance costs (8,822 ) (5,867 ) Net carrying amount $ 1,030,132 $ 643,437 Equity component, net of purchase discounts and issuance costs $ 264,129 $ 234,712 |
Schedule of Interest Expense | The following table sets forth the interest expense related to the Notes: Three Months Ended Six Months Ended (In thousands) July 31, 2019 July 31, 2019 2023 Notes: Coupon interest expense $ 1,581 $ 3,162 Amortization of debt discount (conversion option) 12,218 23,813 Amortization of debt issuance costs and purchase discounts 477 930 Total interest expense related to the 2023 Notes $ 14,276 $ 27,905 2025 Notes: Coupon interest expense $ 2,426 $ 4,852 Amortization of debt discount (conversion option) 7,197 13,968 Amortization of debt issuance costs and purchase discounts 198 384 Total interest expense related to the 2025 Notes $ 9,821 $ 19,204 |
Stock Compensation Plans (Table
Stock Compensation Plans (Tables) | 6 Months Ended |
Jul. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Stock Options, RSUs and PSUs Award Activity | The following table summarizes the stock option, restricted stock unit (“RSU”) and performance unit (“PSU”) award activity during the six months ended July 31, 2019 : Options Outstanding RSUs and PSUs Outstanding Shares Available for Grant Shares Weighted- Average Exercise Price Per Share Weighted- Average Remaining Contractual Term Aggregate Intrinsic Value (1) Shares (in years) (in thousands) Balances as of January 31, 2019 17,082,136 409,039 $ 10.69 3.36 $ 46,693 13,098,607 Additional shares authorized 7,458,364 Options exercised (78,891 ) 7.03 Options forfeited and expired 4,337 (4,337 ) 21.43 RSUs and PSUs granted (2,318,860 ) 2,318,860 RSUs and PSUs vested (2,656,767 ) Shares withheld related to net share settlement of RSUs and PSUs 962,311 RSUs and PSUs forfeited and canceled 858,828 (858,828 ) Balances as of July 31, 2019 24,047,116 325,811 $ 11.43 2.80 $ 40,362 11,901,872 Vested and expected to vest 325,675 $ 11.42 2.80 $ 40,349 11,127,822 Exercisable as of July 31, 2019 315,355 $ 10.94 2.62 $ 39,221 _________________________ (1) The intrinsic value is calculated as the difference between the exercise price of the underlying stock option award and the closing market price of our common stock as of July 31, 2019 . |
Schedule of RSA Activity | The following table summarizes our restricted stock award (“RSA”) activity during the six months ended July 31, 2019 : Shares Outstanding as of January 31, 2019 824,605 RSAs vested (379,393 ) Outstanding as of July 31, 2019 445,212 |
Revenue, Deferred Revenue and P
Revenue, Deferred Revenue and Performance Obligations Revenue from Contract with Customer (Tables) | 6 Months Ended |
Jul. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following table presents disaggregated revenues by major product or service type: Three Months Ended July 31, Six Months Ended July 31, (In thousands) 2019 2018 2019 2018 Revenues License $ 279,279 $ 200,668 $ 482,141 $ 339,643 Maintenance, professional services and training 166,828 148,570 326,761 287,688 Cloud services 70,451 39,065 132,506 72,611 Total revenues $ 516,558 $ 388,303 $ 941,408 $ 699,942 |
Revenue from External Customers by Geographic Areas | Revenues by geography are based on the shipping address of the customer. The following table presents our revenues by geographic region: Three Months Ended July 31, Six Months Ended July 31, (In thousands) 2019 2018 2019 2018 United States $ 352,210 $ 267,201 $ 664,566 $ 494,643 International 164,348 121,102 276,842 205,299 Total revenues $ 516,558 $ 388,303 $ 941,408 $ 699,942 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 6 Months Ended |
Jul. 31, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of computation of historical basic and diluted net loss per share | The following table sets forth the computation of historical basic and diluted net loss per share: Three Months Ended July 31, Six Months Ended July 31, (In thousands, except per share amounts) 2019 2018 2019 2018 Numerator: Net loss $ (100,872 ) $ (103,499 ) $ (256,301 ) $ (221,998 ) Denominator: Weighted-average common shares outstanding 150,812 145,851 150,283 144,361 Less: Weighted-average unvested common shares subject to repurchase or forfeiture (506 ) (821 ) (560 ) (55 ) Weighted-average shares used to compute net loss per share, basic and diluted 150,306 145,030 149,723 144,306 Net loss per share, basic and diluted $ (0.67 ) $ (0.71 ) $ (1.71 ) $ (1.54 ) |
Potentially dilutive securities that were not included in the diluted per share calculations because they would be anti-dilutive | Since we were in a net loss position for all periods presented, basic net loss per share is the same as diluted net loss per share for all periods as the inclusion of all potentially dilutive securities outstanding would have been anti-dilutive. Potentially dilutive securities that were not included in the diluted per share calculations because they would be anti-dilutive were as follows: As of July 31, (In thousands) 2019 2018 Shares subject to outstanding common stock options 326 483 Shares subject to outstanding RSUs, PSUs and RSAs 12,347 13,550 Employee stock purchase plan 342 371 Total 13,015 14,404 |
Segments (Details)
Segments (Details) | 6 Months Ended |
Jul. 31, 2019segment | |
Accounting Policies [Abstract] | |
Number of operating segments | 1 |
Description of the Business a_4
Description of the Business and Significant Accounting Policies Recent Accounting Pronouncements (Details) - USD ($) $ in Thousands | Jul. 31, 2019 | Feb. 01, 2019 | Jan. 31, 2019 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Operating lease right-of-use assets | $ 215,228 | $ 0 | ||
Current and non-current operating lease liabilities | [1],[2] | 232,779 | ||
Adjustment to accumulated deficit | $ (1,481,104) | $ (1,232,044) | ||
Accounting Standards Update 2016-02 | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Operating lease right-of-use assets | $ 199,800 | |||
Current and non-current operating lease liabilities | 211,900 | |||
Adjustment to accumulated deficit | $ 7,200 | |||
[1] | Amounts based on Topic 842, Leases, which we adopted on February 1, 2019. | |||
[2] | The current portion of our operating lease liabilities is included in “Accrued expenses and other liabilities” on our condensed consolidated balance sheets. |
Description of the Business a_5
Description of the Business and Significant Accounting Policies Revenue Recognition (Details) | 6 Months Ended |
Jul. 31, 2019 | |
Minimum | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Accounts receivable payment terms | 30 days |
Maximum | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Accounts receivable payment terms | 60 days |
Investments and Fair Value Me_3
Investments and Fair Value Measurements (Details) - USD ($) $ in Thousands | Jul. 31, 2019 | Jan. 31, 2019 |
Fair Value Measurements | ||
U.S. treasury securities, corporate bonds and commercial paper | $ 994,051 | |
Estimate of Fair Value Measurement | Recurring basis | ||
Fair Value Measurements | ||
Money market funds | 56,707 | $ 46,311 |
Other | 4,000 | 4,744 |
Assets: | ||
Cash and cash equivalents | 65,004 | 46,311 |
Investments, current | 903,864 | 881,220 |
Investments, non-current | 85,890 | 104,463 |
Total | 1,054,758 | 1,031,994 |
Estimate of Fair Value Measurement | Recurring basis | Level 1 | ||
Fair Value Measurements | ||
Money market funds | 56,707 | 46,311 |
Other | 0 | 0 |
Estimate of Fair Value Measurement | Recurring basis | Level 2 | ||
Fair Value Measurements | ||
Money market funds | 0 | 0 |
Other | 0 | 0 |
Estimate of Fair Value Measurement | Recurring basis | Level 3 | ||
Fair Value Measurements | ||
Money market funds | 0 | 0 |
Other | 4,000 | 4,744 |
US Treasury Securities | ||
Fair Value Measurements | ||
U.S. treasury securities, corporate bonds and commercial paper | 980,940 | |
US Treasury Securities | Estimate of Fair Value Measurement | Recurring basis | ||
Fair Value Measurements | ||
U.S. treasury securities, corporate bonds and commercial paper | 824,192 | 980,940 |
US Treasury Securities | Estimate of Fair Value Measurement | Recurring basis | Level 1 | ||
Fair Value Measurements | ||
U.S. treasury securities, corporate bonds and commercial paper | 0 | 0 |
US Treasury Securities | Estimate of Fair Value Measurement | Recurring basis | Level 2 | ||
Fair Value Measurements | ||
U.S. treasury securities, corporate bonds and commercial paper | 824,192 | 980,940 |
US Treasury Securities | Estimate of Fair Value Measurement | Recurring basis | Level 3 | ||
Fair Value Measurements | ||
U.S. treasury securities, corporate bonds and commercial paper | 0 | 0 |
Corporate Bonds | Estimate of Fair Value Measurement | Recurring basis | ||
Fair Value Measurements | ||
U.S. treasury securities, corporate bonds and commercial paper | 149,990 | 0 |
Corporate Bonds | Estimate of Fair Value Measurement | Recurring basis | Level 1 | ||
Fair Value Measurements | ||
U.S. treasury securities, corporate bonds and commercial paper | 0 | 0 |
Corporate Bonds | Estimate of Fair Value Measurement | Recurring basis | Level 2 | ||
Fair Value Measurements | ||
U.S. treasury securities, corporate bonds and commercial paper | 149,990 | 0 |
Corporate Bonds | Estimate of Fair Value Measurement | Recurring basis | Level 3 | ||
Fair Value Measurements | ||
U.S. treasury securities, corporate bonds and commercial paper | 0 | 0 |
Commercial Paper | Estimate of Fair Value Measurement | Recurring basis | ||
Fair Value Measurements | ||
U.S. treasury securities, corporate bonds and commercial paper | 19,869 | 0 |
Commercial Paper | Estimate of Fair Value Measurement | Recurring basis | Level 1 | ||
Fair Value Measurements | ||
U.S. treasury securities, corporate bonds and commercial paper | 0 | 0 |
Commercial Paper | Estimate of Fair Value Measurement | Recurring basis | Level 2 | ||
Fair Value Measurements | ||
U.S. treasury securities, corporate bonds and commercial paper | 19,869 | 0 |
Commercial Paper | Estimate of Fair Value Measurement | Recurring basis | Level 3 | ||
Fair Value Measurements | ||
U.S. treasury securities, corporate bonds and commercial paper | $ 0 | $ 0 |
Investments and Fair Value Me_4
Investments and Fair Value Measurements - Amortized Cost to Fair Value Reconciliation (Details) - USD ($) $ in Thousands | Jul. 31, 2019 | Jan. 31, 2019 |
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | $ 992,873 | |
Unrealized Gains | 1,355 | |
Unrealized Losses | (177) | |
Fair Value | 994,051 | |
US Treasury Securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | $ 980,803 | |
Unrealized Gains | 265 | |
Unrealized Losses | (128) | |
Fair Value | 980,940 | |
US Treasury Securities | Cash and Cash Equivalents [Member] | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 8,296 | |
Unrealized Gains | 1 | |
Unrealized Losses | 0 | |
Fair Value | 8,297 | |
US Treasury Securities | Investments, Current | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 815,244 | 881,206 |
Unrealized Gains | 821 | 131 |
Unrealized Losses | (170) | (117) |
Fair Value | 815,895 | 881,220 |
US Treasury Securities | Investments, Non-current | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 99,597 | |
Unrealized Gains | 134 | |
Unrealized Losses | (11) | |
Fair Value | $ 99,720 | |
Corporate Bonds | Investments, Current | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 67,972 | |
Unrealized Gains | 132 | |
Unrealized Losses | (4) | |
Fair Value | 68,100 | |
Corporate Bonds | Investments, Non-current | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 81,514 | |
Unrealized Gains | 379 | |
Unrealized Losses | (3) | |
Fair Value | 81,890 | |
Commercial Paper | Investments, Current | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 19,847 | |
Unrealized Gains | 22 | |
Unrealized Losses | 0 | |
Fair Value | $ 19,869 |
Investments and Fair Value Me_5
Investments and Fair Value Measurements - Securities in Unrealized Loss Position (Details) - USD ($) $ in Thousands | Jul. 31, 2019 | Jan. 31, 2019 |
US Treasury Securities | ||
Fair Value | ||
Less than 12 Months | $ 178,703 | $ 582,761 |
12 Months or Greater | 0 | 0 |
Total | 178,703 | 582,761 |
Unrealized Losses | ||
Less than 12 Months | (170) | (128) |
12 Months or Greater | 0 | 0 |
Total | (170) | $ (128) |
Corporate Bonds | ||
Fair Value | ||
Less than 12 Months | 12,512 | |
12 Months or Greater | 0 | |
Total | 12,512 | |
Unrealized Losses | ||
Less than 12 Months | (7) | |
12 Months or Greater | 0 | |
Total | $ (7) |
Investments and Fair Value Me_6
Investments and Fair Value Measurements - Contractual Maturities (Details) $ in Thousands | Jul. 31, 2019USD ($) |
Investments, Debt and Equity Securities and Fair Value Disclosures [Abstract] | |
Due within one year | $ 912,161 |
Due within one to two years | 81,890 |
Total | $ 994,051 |
Investments and Fair Value Me_7
Investments and Fair Value Measurements - Equity Investments (Details) - USD ($) $ in Thousands | Jul. 31, 2019 | Jan. 31, 2019 |
Investments, Debt and Equity Securities and Fair Value Disclosures [Abstract] | ||
Equity investments without readily determinable fair values | $ 6,244 | $ 5,000 |
Equity investments under the equity method of accounting | 1,875 | 1,125 |
Total | $ 8,119 | $ 6,125 |
Leases (Details)
Leases (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | Feb. 01, 2019 | Jan. 31, 2019 | |
Lessee, Lease, Description [Line Items] | ||||||
Operating lease cost | $ 11,100 | $ 22,400 | ||||
Rent expense | $ 6,100 | $ 12,200 | ||||
Leases not yet commenced, future lease payments | 249,800 | 249,800 | ||||
Adjustment to accumulated deficit | $ (1,481,104) | $ (1,481,104) | $ (1,232,044) | |||
Minimum | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Term of office lease | 2 years | 2 years | ||||
Maximum | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Term of office lease | 12 years | 12 years | ||||
Property and equipment | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Lease accounted for as build-to-suit | 76,200 | |||||
Other Noncurrent Liabilities | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Finance lease obligations | $ 83,400 | |||||
Accounting Standards Update 2016-02 | ||||||
Lessee, Lease, Description [Line Items] | ||||||
Adjustment to accumulated deficit | $ 7,200 |
Leases - Lease Term and Discoun
Leases - Lease Term and Discount Rate (Details) | Jul. 31, 2019 |
Leases [Abstract] | |
Weighted-average remaining lease term (in years) | 7 years 8 months 8 days |
Weighted-average discount rate | 5.98% |
Leases - Maturity of Lease Liab
Leases - Maturity of Lease Liability, After Adoption of 842 (Details) $ in Thousands | Jul. 31, 2019USD ($) | [1] |
Leases [Abstract] | ||
Remaining fiscal 2020 | $ 20,454 | |
Fiscal 2021 | 44,163 | |
Fiscal 2022 | 43,169 | |
Fiscal 2023 | 38,581 | |
Fiscal 2024 | 29,114 | |
Thereafter | 117,940 | |
Total lease payments | 293,421 | |
Less imputed interest | (60,642) | |
Total current and non-current operating lease liabilities (2) | $ 232,779 | [2] |
[1] | Amounts based on Topic 842, Leases, which we adopted on February 1, 2019. | |
[2] | The current portion of our operating lease liabilities is included in “Accrued expenses and other liabilities” on our condensed consolidated balance sheets. |
Leases - Maturity of Lease Li_2
Leases - Maturity of Lease Liability, Prior to 842 Adoption (Details) $ in Thousands | 12 Months Ended | |
Jan. 31, 2019USD ($) | ||
Leases [Abstract] | ||
Fiscal 2020 | $ 30,976 | [1] |
Fiscal 2021 | 48,195 | [1] |
Fiscal 2022 | 48,126 | [1] |
Fiscal 2023 | 44,018 | [1] |
Fiscal 2024 | 40,636 | [1] |
Thereafter | 253,856 | [1] |
Total future minimum lease payments | 465,807 | [1],[2] |
Sublease agreements, future rental income | $ 2,300 | |
[1] | Amounts based on Topic 840, Leases. | |
[2] | We entered into sublease agreements for portions of our office space and the future rental income of $2.3 million from these agreements have been included as an offset to our future minimum rental payments. |
Leases - Supplemental Disclosur
Leases - Supplemental Disclosure (Details) $ in Thousands | 6 Months Ended |
Jul. 31, 2019USD ($) | |
Leases [Abstract] | |
Cash paid for operating lease liabilities | $ 19,253 |
Operating lease liabilities arising from obtaining right-of-use assets | $ 31,238 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | Jan. 31, 2019 | |
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, gross | $ 203,174 | $ 203,174 | $ 260,073 | ||
Less: accumulated depreciation and amortization | (108,305) | (108,305) | (101,797) | ||
Property and equipment, net | 94,869 | 94,869 | 158,276 | ||
Depreciation and amortization expense on Property and Equipment, net | 6,600 | $ 6,500 | 12,900 | $ 13,100 | |
Computer equipment and software | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, gross | 85,564 | 85,564 | 79,887 | ||
Furniture and fixtures | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, gross | 19,669 | 19,669 | 18,872 | ||
Leasehold Improvements | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, gross | 97,941 | 97,941 | 79,064 | ||
Building | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, gross | 0 | 0 | 82,250 | ||
Leasehold improvements not in service | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, gross | 28,900 | 28,900 | 11,300 | ||
International [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, net | 12,264 | 12,264 | 10,617 | ||
United States | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, net | $ 82,605 | $ 82,605 | $ 147,659 |
Acquisitions, Goodwill and In_3
Acquisitions, Goodwill and Intangible Assets (Details Textual) - USD ($) $ in Thousands | Jun. 22, 2018 | Apr. 06, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | Jan. 31, 2019 |
Business Acquisition [Line Items] | |||||||
Goodwill | $ 503,388 | $ 503,388 | $ 503,388 | ||||
Amortization of intangible assets | $ 7,100 | $ 6,300 | $ 14,200 | $ 11,000 | |||
VictorOps | |||||||
Business Acquisition [Line Items] | |||||||
Percentage of voting interests acquired | 100.00% | ||||||
Purchase price | $ 112,300 | ||||||
Purchase price paid in cash | 108,800 | ||||||
Fair value of replacement equity awards attributable to pre-acquisition service | 3,500 | ||||||
Acquired fair value of finite-lived intangible assets | 21,100 | ||||||
Net assets acquired | 1,700 | ||||||
Goodwill | 89,500 | ||||||
Acquisition-related costs | 2,700 | ||||||
Replacement equity awards | $ 7,600 | ||||||
Phantom Cyber Corporation | |||||||
Business Acquisition [Line Items] | |||||||
Percentage of voting interests acquired | 100.00% | ||||||
Purchase price | $ 303,800 | ||||||
Purchase price paid in cash | 291,500 | ||||||
Fair value of replacement equity awards attributable to pre-acquisition service | 12,300 | ||||||
Acquired fair value of finite-lived intangible assets | 44,100 | ||||||
Net assets acquired | 10,500 | ||||||
Goodwill | 252,500 | ||||||
Acquisition-related costs | $ 3,300 | ||||||
Replacement equity awards | 62,200 | ||||||
Net deferred tax liabilities assumed | $ 3,300 |
Acquisitions, Goodwill and In_4
Acquisitions, Goodwill and Intangible Assets (Details) - USD ($) $ in Thousands | Jun. 22, 2018 | Apr. 06, 2018 | Jul. 31, 2019 | Jan. 31, 2019 |
Developed technology | ||||
Finite-Lived and Indefinite-lived Intangible Assets Acquired as Part of Business Combination [Line Items] | ||||
Weighted Average Remaining Useful Life | 49 months | 52 months | ||
Customer relationships | ||||
Finite-Lived and Indefinite-lived Intangible Assets Acquired as Part of Business Combination [Line Items] | ||||
Weighted Average Remaining Useful Life | 46 months | 52 months | ||
VictorOps | ||||
Finite-Lived and Indefinite-lived Intangible Assets Acquired as Part of Business Combination [Line Items] | ||||
Acquired fair value of finite-lived intangible assets | $ 21,100 | |||
VictorOps | Developed technology | ||||
Finite-Lived and Indefinite-lived Intangible Assets Acquired as Part of Business Combination [Line Items] | ||||
Acquired fair value of finite-lived intangible assets | $ 11,700 | |||
Weighted Average Remaining Useful Life | 84 months | |||
VictorOps | Customer relationships | ||||
Finite-Lived and Indefinite-lived Intangible Assets Acquired as Part of Business Combination [Line Items] | ||||
Acquired fair value of finite-lived intangible assets | $ 9,400 | |||
Weighted Average Remaining Useful Life | 60 months | |||
Phantom Cyber Corporation | ||||
Finite-Lived and Indefinite-lived Intangible Assets Acquired as Part of Business Combination [Line Items] | ||||
Acquired fair value of finite-lived intangible assets | $ 44,100 | |||
Phantom Cyber Corporation | Developed technology | ||||
Finite-Lived and Indefinite-lived Intangible Assets Acquired as Part of Business Combination [Line Items] | ||||
Acquired fair value of finite-lived intangible assets | $ 34,400 | |||
Weighted Average Remaining Useful Life | 84 months | |||
Phantom Cyber Corporation | Customer relationships | ||||
Finite-Lived and Indefinite-lived Intangible Assets Acquired as Part of Business Combination [Line Items] | ||||
Acquired fair value of finite-lived intangible assets | $ 9,700 | |||
Weighted Average Remaining Useful Life | 60 months |
Goodwill (Details)
Goodwill (Details) $ in Thousands | 6 Months Ended |
Jul. 31, 2019USD ($) | |
Goodwill [Roll Forward] | |
Balance as of January 31, 2019 | $ 503,388 |
Goodwill acquired | 0 |
Balance as of July 31, 2019 | $ 503,388 |
Intangible Assets Amortization
Intangible Assets Amortization (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jul. 31, 2019 | Jan. 31, 2019 | |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Fair Value | $ 156,280 | $ 156,280 |
Accumulated Amortization | (78,863) | (64,658) |
Total | 77,417 | 91,622 |
Developed technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Fair Value | 132,100 | 132,100 |
Accumulated Amortization | (69,394) | (57,596) |
Total | $ 62,706 | $ 74,504 |
Weighted Average Remaining Useful Life | 49 months | 52 months |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Fair Value | $ 20,910 | $ 20,910 |
Accumulated Amortization | (6,433) | (4,523) |
Total | $ 14,477 | $ 16,387 |
Weighted Average Remaining Useful Life | 46 months | 52 months |
Other acquired intangible assets | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Fair Value | $ 3,270 | $ 3,270 |
Accumulated Amortization | (3,036) | (2,539) |
Total | $ 234 | $ 731 |
Weighted Average Remaining Useful Life | 4 months | 9 months |
Intangible Assets Expected Futu
Intangible Assets Expected Future Amortization Expense (Details) - USD ($) $ in Thousands | Jul. 31, 2019 | Jan. 31, 2019 |
Business Combinations [Abstract] | ||
Remaining fiscal 2020 | $ 13,737 | |
Fiscal 2021 | 23,780 | |
Fiscal 2022 | 13,701 | |
Fiscal 2023 | 10,406 | |
Fiscal 2024 | 7,692 | |
Thereafter | 8,101 | |
Total | $ 77,417 | $ 91,622 |
Convertible Senior Notes - Narr
Convertible Senior Notes - Narrative (Details) $ / shares in Units, $ in Thousands | Sep. 21, 2018USD ($)$ / shares | Jul. 31, 2019USD ($)trading_day | Sep. 18, 2018$ / shares |
Debt Instrument [Line Items] | |||
Proceeds from the issuance of convertible senior notes, net of issuance costs | $ 2,110,000 | ||
Purchase of capped calls | $ 274,300 | ||
Minimum | |||
Debt Instrument [Line Items] | |||
Initial conversion price | $ / shares | $ 148.30 | ||
Maximum | |||
Debt Instrument [Line Items] | |||
Initial conversion price | $ / shares | $ 232.62 | ||
Convertible Senior Notes | |||
Debt Instrument [Line Items] | |||
Conversion ratio | 6.7433 | ||
Initial conversion price | $ / shares | $ 148.30 | ||
Initial conversion price premium, percent | 27.50% | ||
Share Price | $ / shares | $ 116.31 | ||
Trading days threshold | trading_day | 20 | ||
Consecutive trading days threshold | trading_day | 30 | ||
Percentage of stock trigger price | 130.00% | ||
Convertible senior notes repurchase price percentage | 100.00% | ||
Convertible Senior Notes | 2023 Notes | |||
Debt Instrument [Line Items] | |||
Long-term debt | $ 1,270,000 | $ 1,030,132 | |
Stated interest rate | 0.50% | ||
Option to purchase additional amount | $ 165,000 | ||
Equity component | 264,129 | ||
Unamortized issuance costs | $ 8,822 | ||
Effective interest rate | 5.65% | ||
Convertible senior notes, fair value | $ 1,450,000 | ||
Convertible Senior Notes | 2023 Notes | Additional paid-in capital | |||
Debt Instrument [Line Items] | |||
Equity component | 266,900 | ||
Unamortized issuance costs | 2,800 | ||
Convertible Senior Notes | 2023 Notes | Liability | |||
Debt Instrument [Line Items] | |||
Unamortized issuance costs | 10,400 | ||
Convertible Senior Notes | 2025 Notes | |||
Debt Instrument [Line Items] | |||
Long-term debt | $ 862,500 | $ 643,437 | |
Stated interest rate | 1.125% | ||
Option to purchase additional amount | $ 112,500 | ||
Consecutive trading days threshold | 10 | ||
Equity component | $ 234,712 | ||
Measurement period, business days | 5 | ||
Percentage of stock trigger price for measurement period | 98.00% | ||
Unamortized issuance costs | $ 5,867 | ||
Effective interest rate | 6.22% | ||
Convertible senior notes, fair value | $ 1,010,000 | ||
Convertible Senior Notes | 2025 Notes | Additional paid-in capital | |||
Debt Instrument [Line Items] | |||
Equity component | 237,200 | ||
Unamortized issuance costs | $ 2,500 | ||
Convertible Senior Notes | 2025 Notes | Liability | |||
Debt Instrument [Line Items] | |||
Unamortized issuance costs | $ 6,500 | ||
Fiscal Quarter Commencing After the Fiscal Quarter Ending On January 31, 2019 | Convertible Senior Notes | |||
Debt Instrument [Line Items] | |||
Trading days threshold | 20 | ||
Consecutive trading days threshold | 30 | ||
Percentage of stock trigger price | 130.00% |
Convertible Senior Notes - Sche
Convertible Senior Notes - Schedule of Carrying Amount of the Liability and Equity (Details) - Convertible Senior Notes - USD ($) $ in Thousands | Jul. 31, 2019 | Sep. 21, 2018 |
2023 Notes | ||
Liability component: | ||
Principal amount | $ 1,265,000 | |
Unamortized discount | (226,046) | |
Unamortized issuance costs | (8,822) | |
Net carrying amount | 1,030,132 | $ 1,270,000 |
Equity component, net of purchase discounts and issuance costs | 264,129 | |
2025 Notes | ||
Liability component: | ||
Principal amount | 862,500 | |
Unamortized discount | (213,196) | |
Unamortized issuance costs | (5,867) | |
Net carrying amount | 643,437 | $ 862,500 |
Equity component, net of purchase discounts and issuance costs | $ 234,712 |
Convertible Senior Notes - Sc_2
Convertible Senior Notes - Schedule of Interest Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |
Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | |
Debt Instrument [Line Items] | |||
Amortization of debt issuance costs and purchase discounts | $ (39,095) | $ 0 | |
Convertible Senior Notes | 2023 Notes | |||
Debt Instrument [Line Items] | |||
Coupon interest expense | $ 1,581 | 3,162 | |
Amortization of debt discount (conversion option) | 12,218 | 23,813 | |
Amortization of debt issuance costs and purchase discounts | 477 | 930 | |
Total interest expense | 14,276 | 27,905 | |
Convertible Senior Notes | 2025 Notes | |||
Debt Instrument [Line Items] | |||
Coupon interest expense | 2,426 | 4,852 | |
Amortization of debt discount (conversion option) | 7,197 | 13,968 | |
Amortization of debt issuance costs and purchase discounts | 198 | 384 | |
Total interest expense | $ 9,821 | $ 19,204 |
Stock Compensation Plans (Detai
Stock Compensation Plans (Details) | 6 Months Ended |
Jul. 31, 2019shares | |
Available for Grant | |
Balances at the beginning of the period (in shares) | 17,082,136 |
Additional Shares Authorized (in shares) | 7,458,364 |
Options forfeited and expired (in shares) | 4,337 |
RSUs and PSUs granted (in shares) | (2,318,860) |
Shares withheld related to net share settlement of RSUs (in shares) | 962,311 |
RSUs and PSUs forfeited and canceled (in shares) | 858,828 |
Balances at the end of the period (in shares) | 24,047,116 |
Stock Compensation Plans (Det_2
Stock Compensation Plans (Details 2) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | |
Jul. 31, 2019 | Jul. 31, 2019 | Jan. 31, 2019 | ||
Shares | ||||
Options forfeited and expired (in shares) | (4,337) | |||
Number of Shares | ||||
RSUs and PSUs granted (in shares) | (2,318,860) | |||
Shares withheld related to net share settlement of RSUs (in shares) | 962,311 | |||
RSUs and PSUs forfeited and canceled (in shares) | (858,828) | |||
Options | ||||
Shares | ||||
Outstanding at the beginning of the period (in shares) | 409,039 | |||
Options exercised (in shares) | (78,891) | |||
Options forfeited and expired (in shares) | (4,337) | |||
Outstanding at the end of the period (in shares) | 325,811 | 325,811 | 409,039 | |
Vested and expected to vest at the end of the period (in shares) | 325,675 | 325,675 | ||
Exercisable at the end of the period (in shares) | 315,355 | 315,355 | ||
Weighted-Average Exercise Price Per Share | ||||
Balances at the beginning of the period (in dollars per share) | $ 10.69 | |||
Options exercised (in dollars per share) | 7.03 | |||
Options forfeited (in dollars per share) | 21.43 | |||
Balances at the end of the period (in dollars per share) | $ 11.43 | 11.43 | $ 10.69 | |
Vested and expected to vest at the end of the period (in dollars per share) | 11.42 | 11.42 | ||
Exercisable at the end of the period (in dollars per share) | $ 10.94 | $ 10.94 | ||
Weighted-Average Remaining Contractual Term | ||||
Balances at the end of the period | 2 years 9 months 18 days | 3 years 4 months 9 days | ||
Vested and expected to vest at the end of the period | 2 years 9 months 18 days | |||
Vested and exercisable at the end of the period | 2 years 7 months 13 days | |||
Aggregate Intrinsic Value | ||||
Outstanding at the end of the period (in dollars) | [1] | $ 40,362 | $ 40,362 | $ 46,693 |
Vested and expected to vest at the end of the period (in dollars) | [1] | 40,349 | 40,349 | |
Vested and exercisable at the end of the period (in dollars) | [1] | 39,221 | 39,221 | |
Unrecognized compensation cost | ||||
Total unrecognized compensation cost related to stock options | $ 800 | 800 | ||
Weighted-average period over which unrecognized compensation cost is expected to be recognized | 1 year | |||
Additional disclosures | ||||
Total intrinsic value of options exercised (in dollars) | $ 9,500 | |||
RSUs and PSUs | ||||
Number of Shares | ||||
Balances at the beginning of the period (in shares) | 13,098,607 | |||
RSUs and PSUs granted (in shares) | 2,318,860 | |||
RSUs and PSUs vested (in shares) | (2,656,767) | |||
RSUs and PSUs forfeited and canceled (in shares) | (858,828) | |||
Balances at the end of the period (in shares) | 11,901,872 | 11,901,872 | 13,098,607 | |
RSUs vested and expected to vest at the end of the period (in shares) | 11,127,822 | 11,127,822 | ||
Unrecognized compensation cost | ||||
Weighted-average period over which unrecognized compensation cost is expected to be recognized | 2 years 8 months 12 days | |||
Total unrecognized compensation cost | $ 862,300 | $ 862,300 | ||
Additional disclosures | ||||
Weighted-average grant date fair value of awards granted (in dollars per share) | $ 129.68 | |||
PSUs | ||||
Unrecognized compensation cost | ||||
Weighted-average period over which unrecognized compensation cost is expected to be recognized | 2 years 7 months 6 days | |||
Total unrecognized compensation cost | $ 77,300 | $ 77,300 | ||
Additional disclosures | ||||
Weighted-average grant date fair value of awards granted (in dollars per share) | $ 168.11 | |||
RSAs | ||||
Number of Shares | ||||
Balances at the beginning of the period (in shares) | 824,605 | |||
RSUs and PSUs vested (in shares) | (379,393) | |||
Balances at the end of the period (in shares) | 445,212 | 445,212 | 824,605 | |
Unrecognized compensation cost | ||||
Weighted-average period over which unrecognized compensation cost is expected to be recognized | 1 year 7 months 6 days | |||
Total unrecognized compensation cost | $ 31,800 | $ 31,800 | ||
Minimum | PSUs | ||||
Tax benefits | ||||
Award vesting rights | 0.00% | |||
Maximum | PSUs | ||||
Tax benefits | ||||
Award vesting rights | 200.00% | |||
Additional award vesting rights | 50.00% | |||
[1] | The intrinsic value is calculated as the difference between the exercise price of the underlying stock option award and the closing market price of our common stock as of July 31, 2019 . |
Revenue Narrative (Details)
Revenue Narrative (Details) - Customer concentration risk - customer | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | Jan. 31, 2019 | |
Accounts receivable | |||||
Concentration Risk [Line Items] | |||||
Number of customers accounting for 10 percent or more of the AR concentration risk | 2 | 2 | 2 | ||
Revenues | |||||
Concentration Risk [Line Items] | |||||
Number of customers accounting for 10 percent or more of the revenue concentration risk | 2 | 2 | 2 | 2 | |
Customer One | Accounts receivable | |||||
Concentration Risk [Line Items] | |||||
Concentration risk, percentage | 22.00% | 29.00% | |||
Customer One | Revenues | |||||
Concentration Risk [Line Items] | |||||
Concentration risk, percentage | 30.00% | 33.00% | 31.00% | 31.00% | |
Customer Two | Accounts receivable | |||||
Concentration Risk [Line Items] | |||||
Concentration risk, percentage | 11.00% | 10.00% | |||
Customer Two | Revenues | |||||
Concentration Risk [Line Items] | |||||
Concentration risk, percentage | 17.00% | 16.00% | 18.00% | 15.00% |
Revenue, Deferred Revenue and_2
Revenue, Deferred Revenue and Performance Obligations Disaggregated Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | |
Disaggregation of Revenue [Line Items] | ||||
Total revenues | $ 516,558 | $ 388,303 | $ 941,408 | $ 699,942 |
License | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 279,279 | 200,668 | 482,141 | 339,643 |
Maintenance, professional services and training | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 166,828 | 148,570 | 326,761 | 287,688 |
Cloud services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | $ 70,451 | $ 39,065 | $ 132,506 | $ 72,611 |
Revenue - Geographic Informatio
Revenue - Geographic Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | |
Concentration Risk [Line Items] | ||||
Revenues | $ 516,558 | $ 388,303 | $ 941,408 | $ 699,942 |
United States | ||||
Concentration Risk [Line Items] | ||||
Revenues | 352,210 | 267,201 | 664,566 | 494,643 |
International | ||||
Concentration Risk [Line Items] | ||||
Revenues | $ 164,348 | $ 121,102 | $ 276,842 | $ 205,299 |
Revenue, Deferred Revenue and_3
Revenue, Deferred Revenue and Performance Obligations Deferred Revenue (Details) - USD ($) $ in Millions | 6 Months Ended | |
Jul. 31, 2019 | Jul. 31, 2018 | |
Revenue from Contract with Customer [Abstract] | ||
Recognition of deferred revenue from opening deferred balance | $ 395.1 | $ 279.2 |
Revenue, Deferred Revenue and_4
Revenue, Deferred Revenue and Performance Obligations Remaining Performance Obligations (Details) $ in Millions | Jul. 31, 2019USD ($) |
Revenue from Contract with Customer [Abstract] | |
Revenue, Remaining Performance Obligation, Amount | $ 1,240 |
Revenue, Remaining Performance Obligation, Percentage | 61.00% |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 12 months |
Revenue, Deferred Revenue and_5
Revenue, Deferred Revenue and Performance Obligations Receivables (Details) - USD ($) $ in Millions | Jul. 31, 2019 | Jan. 31, 2019 |
Receivables [Abstract] | ||
Total current and non-current accounts receivable | $ 659.9 | $ 625.1 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | |
Income Tax Disclosure [Abstract] | ||||
Income tax provision (benefit) | $ 5,632 | $ 811 | $ 8,865 | $ (1,177) |
Net Loss Per Share (Details)
Net Loss Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Jul. 31, 2018 | |
Numerator | ||||
Net loss | $ (100,872) | $ (103,499) | $ (256,301) | $ (221,998) |
Denominator | ||||
Weighted-average common shares outstanding (in shares) | 150,812 | 145,851 | 150,283 | 144,361 |
Less: Weighted-average unvested common shares subject to repurchase or forfeiture (in shares) | (506) | (821) | (560) | (55) |
Weighted-average shares used to compute net loss per share, basic and diluted (in shares) | 150,306 | 145,030 | 149,723 | 144,306 |
Net loss per share | ||||
Net loss per share, basic and diluted (in dollars per share) | $ (0.67) | $ (0.71) | $ (1.71) | $ (1.54) |
Net Loss Per Share - Potentiall
Net Loss Per Share - Potentially Dilutive Securities (Details) - shares shares in Thousands | 6 Months Ended | |
Jul. 31, 2019 | Jul. 31, 2018 | |
Potentially dilutive securities | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 13,015 | 14,404 |
Shares subject to outstanding common stock options | ||
Potentially dilutive securities | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 326 | 483 |
Shares subject to outstanding RSUs, PSUs and RSAs | ||
Potentially dilutive securities | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 12,347 | 13,550 |
Employee stock purchase plan | ||
Potentially dilutive securities | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 342 | 371 |
Net Loss Per Share Net Loss Per
Net Loss Per Share Net Loss Per Share Conversion Shares (Details) - Convertible Senior Notes - $ / shares shares in Millions | 6 Months Ended | |
Jul. 31, 2019 | Sep. 21, 2018 | |
Potentially dilutive securities | ||
Incremental Common Shares Attributable to Dilutive Effect of Conversion of Debt Securities | 14.3 | |
Initial conversion price | $ 148.30 |
Subsequent Event (Details)
Subsequent Event (Details) - Subsequent Event - USD ($) $ in Millions | Aug. 30, 2019 | Aug. 21, 2019 |
SignalFx | ||
Subsequent Event [Line Items] | ||
Consideration transferred | $ 1,050 | |
Consideration transferred, percentage paid in cash | 60.00% | |
Consideration transferred, percentage paid through common stock | 40.00% | |
Cloud Native Labs | ||
Subsequent Event [Line Items] | ||
Consideration transferred | $ 90 | |
Consideration transferred, percentage paid in cash | 40.00% | |
Consideration transferred, percentage paid through common stock | 60.00% |