Cover Page
Cover Page - shares | 3 Months Ended | |
Apr. 30, 2020 | May 26, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Apr. 30, 2020 | |
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 $0.001 per share | |
Trading Symbol | SPLK | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 158,868,955 | |
Entity Central Index Key | 0001353283 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --01-31 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q1 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Apr. 30, 2020 | Jan. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 922,507 | $ 778,653 |
Investments, current | 834,067 | 976,508 |
Accounts receivable, net | 645,151 | 838,743 |
Prepaid expenses and other current assets | 127,443 | 129,839 |
Deferred commissions, current | 100,013 | 99,072 |
Total current assets | 2,629,181 | 2,822,815 |
Investments, non-current | 17,142 | 35,370 |
Accounts receivable, non-current | 335,427 | 468,934 |
Operating lease right-of-use assets | 398,652 | 267,086 |
Property and equipment, net | 168,221 | 156,928 |
Intangible assets, net | 223,684 | 238,415 |
Goodwill | 1,292,840 | 1,292,840 |
Deferred commissions, non-current | 83,386 | 88,990 |
Other assets | 75,735 | 68,093 |
Total assets | 5,224,268 | 5,439,471 |
Current liabilities: | ||
Accounts payable | 24,874 | 18,938 |
Accrued compensation | 186,558 | 286,159 |
Accrued expenses and other liabilities | 179,568 | 177,822 |
Deferred revenue, current | 769,044 | 829,377 |
Total current liabilities | 1,160,044 | 1,312,296 |
Convertible senior notes, net | 1,735,046 | 1,714,630 |
Operating lease liabilities | 364,837 | 235,631 |
Deferred revenue, non-current | 153,141 | 176,832 |
Other liabilities, non-current | 1,145 | 653 |
Total non-current liabilities | 2,254,169 | 2,127,746 |
Total liabilities | 3,414,213 | 3,440,042 |
Commitments and contingencies (Note 3 and 4) | ||
Stockholders' equity: | ||
Common stock: $0.001 par value; 1,000,000,000 shares authorized; 158,841,311 shares issued and outstanding at April 30, 2020, and 157,787,548 shares issued and outstanding at January 31, 2020 | 158 | 157 |
Accumulated other comprehensive loss | (1,948) | (5,312) |
Additional paid-in capital | 3,678,895 | 3,566,055 |
Accumulated deficit | (1,867,050) | (1,561,471) |
Total stockholders' equity | 1,810,055 | 1,999,429 |
Total liabilities and stockholders' equity | $ 5,224,268 | $ 5,439,471 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Apr. 30, 2020 | Jan. 31, 2020 |
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 | 158,841,311 | 157,787,548 |
Common stock, shares outstanding | 158,841,311 | 157,787,548 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | ||
Apr. 30, 2020 | Apr. 30, 2019 | ||
Revenues | |||
Total revenues | $ 434,077 | $ 424,850 | |
Cost of revenues | |||
Total cost of revenues | [1] | 128,617 | 95,823 |
Gross profit | 305,460 | 329,027 | |
Operating expenses | |||
Research and development | [1] | 192,124 | 129,290 |
Sales and marketing | [1] | 319,224 | 278,961 |
General and administrative | [1] | 82,724 | 65,762 |
Total operating expenses | [1] | 594,072 | 474,013 |
Operating loss | (288,612) | (144,986) | |
Interest and other income (expense), net | |||
Interest income | 6,475 | 16,346 | |
Interest expense | (24,437) | (23,017) | |
Other income (expense), net | (674) | (539) | |
Total interest and other income (expense), net | (18,636) | (7,210) | |
Loss before income taxes | (307,248) | (152,196) | |
Income tax provision (benefit) | (1,669) | 3,233 | |
Net loss | $ (305,579) | $ (155,429) | |
Net loss per share: | |||
Basic and diluted (in dollars per share) | $ (1.94) | $ (1.04) | |
Weighted-average shares outstanding: | |||
Basic and diluted (in shares) | 157,534 | 149,060 | |
License | |||
Revenues | |||
Total revenues | $ 148,385 | $ 202,862 | |
Cost of revenues | |||
Total cost of revenues | [1] | 6,066 | 5,682 |
Cloud services | |||
Revenues | |||
Total revenues | 112,152 | 62,055 | |
Cost of revenues | |||
Total cost of revenues | [1] | 53,490 | 32,326 |
Maintenance and services | |||
Revenues | |||
Total revenues | 173,540 | 159,933 | |
Cost of revenues | |||
Total cost of revenues | [1] | $ 69,061 | $ 57,815 |
[1] | Amounts include stock-based compensation expense, as follows: Cost of revenues, $13,202 thousand and $10,825 thousand; Research and development, $68,569 thousand and $41,268 thousand; Sales and marketing, $56,474 thousand and $50,268 thousand; General and administrative, $20,573 thousand and $20,702 thousand for the three months ended April 30, 2020 and 2019, respectively. |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 30, 2020 | Apr. 30, 2019 | |
Stock-based compensation | $ 158,818 | $ 123,063 |
Cost of revenues | ||
Stock-based compensation | 13,202 | 10,825 |
Research and development | ||
Stock-based compensation | 68,569 | 41,268 |
Sales and marketing | ||
Stock-based compensation | 56,474 | 50,268 |
General and administrative | ||
Stock-based compensation | $ 20,573 | $ 20,702 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 30, 2020 | Apr. 30, 2019 | |
Net loss | $ (305,579) | $ (155,429) |
Other comprehensive income (loss): | ||
Net unrealized gain on investments (net of tax) | 2,685 | 332 |
Foreign currency translation adjustments | 679 | (991) |
Total other comprehensive income (loss) | 3,364 | (659) |
Comprehensive loss | $ (302,215) | $ (156,088) |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 30, 2020 | Apr. 30, 2019 | |
Cash flows from operating activities | ||
Net loss | $ (305,579) | $ (155,429) |
Adjustments to reconcile net loss to net cash provided by operating activities | ||
Depreciation and amortization | 20,494 | 13,415 |
Amortization of deferred commissions | 26,878 | 30,032 |
Amortization of investment premiums, net (accretion of discounts) | (692) | (2,859) |
Amortization of debt discount and issuance costs | 20,416 | 19,005 |
Non-cash operating lease costs | 10,531 | 4,549 |
Stock-based compensation | 158,818 | 123,063 |
Disposal of property and equipment | 505 | 0 |
Deferred income taxes | (901) | (20) |
Changes in operating assets and liabilities | ||
Accounts receivable, net | 327,099 | 184,358 |
Prepaid expenses and other assets | (4,846) | (17,900) |
Deferred commissions | (22,215) | (23,452) |
Accounts payable | 7,336 | 2,925 |
Accrued compensation | (97,709) | (62,777) |
Accrued expenses and other liabilities | (10,067) | (7,665) |
Deferred revenue | (84,024) | (72,216) |
Net cash provided by operating activities | 46,044 | 35,029 |
Cash flows from investing activities | ||
Purchases of investments | (87,135) | (289,425) |
Maturities of investments | 254,823 | 298,425 |
Purchases of property and equipment | (14,756) | (14,900) |
Capitalized software development costs | (3,548) | 0 |
Other investment activities | 2,375 | 375 |
Net cash provided by (used in) investing activities | 147,009 | (6,275) |
Cash flows from financing activities | ||
Proceeds from the exercise of stock options | 1,418 | 360 |
Taxes paid related to net share settlement of equity awards | (49,228) | (69,007) |
Net cash used in financing activities | (47,810) | (68,647) |
Effect of exchange rate changes on cash and cash equivalents | (1,389) | (1,043) |
Net increase (decrease) in cash and cash equivalents | 143,854 | (40,936) |
Cash and cash equivalents at beginning of period | 778,653 | 1,876,165 |
Cash and cash equivalents at end of period | 922,507 | 1,835,229 |
Supplemental disclosures | ||
Cash paid for income taxes | 1,534 | 8,316 |
Cash paid for interest | 8,014 | 7,747 |
Non-cash investing activities | ||
Decrease in accrued purchases of property and equipment | (1,639) | (853) |
Vesting of early exercised options | $ 56 | $ 0 |
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 | $ 7,241 | ||||
Balance, beginning of period at Jan. 31, 2019 | $ 149 | $ 2,754,858 | $ (2,506) | (1,232,044) | |
Vesting of restricted stock units | 1 | ||||
Stock-based compensation | 123,063 | ||||
Capitalized software development costs | 0 | ||||
Issuance of common stock upon exercise of options | 359 | ||||
Vesting of early exercised options | $ 0 | 0 | |||
Taxes paid related to net share settlement of equity awards | (69,007) | ||||
Unrealized gain from investments (net of tax) | 332 | ||||
Net change in cumulative translation adjustments | (991) | (991) | |||
Net loss | (155,429) | (155,429) | |||
Balance, end of period at Apr. 30, 2019 | 1,426,026 | 150 | 2,809,273 | (3,165) | (1,380,232) |
Cumulative-effect adjustment from adoption of ASU | Accounting Standards Update 2016-02 | 0 | ||||
Balance, beginning of period at Jan. 31, 2020 | 1,999,429 | 157 | 3,566,055 | (5,312) | (1,561,471) |
Vesting of restricted stock units | 1 | ||||
Stock-based compensation | 158,818 | ||||
Capitalized software development costs | 1,776 | ||||
Issuance of common stock upon exercise of options | 1,418 | ||||
Vesting of early exercised options | 56 | 56 | |||
Taxes paid related to net share settlement of equity awards | (49,228) | ||||
Unrealized gain from investments (net of tax) | 2,685 | ||||
Net change in cumulative translation adjustments | 679 | 679 | |||
Net loss | (305,579) | (305,579) | |||
Balance, end of period at Apr. 30, 2020 | $ 1,810,055 | $ 158 | $ 3,678,895 | $ (1,948) | $ (1,867,050) |
Description of the Business and
Description of the Business and Significant Accounting Policies | 3 Months Ended |
Apr. 30, 2020 | |
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 ingest data from different sources including systems, devices and interactions, and turn that data into meaningful business insights across the organization. Our Data-to-Everything platform enables users to investigate, monitor, analyze and act on data regardless of format or source. 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 business transactions, customer and user behavior, and security threats. Our Data-to-Everything platform helps organizations gain the value contained in data by delivering real-time information to enable operational decision making. 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 2021, for example, refer to the fiscal year ending January 31, 2021. 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, 2020 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, 2020, filed with the SEC on March 26, 2020. 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 2021. Reclassifications Certain reclassifications have been made to prior period balances in order to conform to the current period presentation. “Cloud services” revenues have been reclassified from “Maintenance and services” revenues on our condensed consolidated statements of operations and “Non-cash operating lease costs” have been reclassified from “Accrued expenses and other liabilities” in our condensed consolidated statement of cash flows. These reclassifications had no impact on our previously reported total revenues and net cash flows from operating, investing, or financing activities. 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. COVID-19 The worldwide spread of COVID-19 has resulted in a global slowdown of economic activity which is likely to decrease demand for a broad variety of goods and services, while also disrupting sales channels, marketing activities and general business operations for an unknown period of time until the disease is contained. At this point, the extent to which COVID-19 may impact our financial condition or results of operations is uncertain, and as of the date of issuance of those financial statements, we are not aware of any specific event or circumstance that would require us to update our estimates, judgments or adjust the carrying value of our assets or liabilities. These estimates may change, as new events occur and additional information is obtained, and are recognized in the condensed consolidated financial statements as soon as they become known. Actual results could differ from those estimates and any such differences may be material to our financial statements. Segments We operate our business as one operating segment: the development and marketing of software solutions that enable our customers to gain real-time business insights 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. Foreign Currency The functional currency of our foreign subsidiaries is their respective local currency, with the exception of our United Kingdom subsidiary, for 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. Our contracts with customers often contain multiple performance obligations, which may include a combination of on-premise software licenses, related maintenance and support services, cloud services and professional services including training. We apply significant judgment in identifying and accounting for each performance obligation, as a result of evaluating the terms and conditions in contracts. For these contracts, we account for on-premise licenses, maintenance and support, cloud services and other services as separate performance obligations as they are each distinct. Revenue is recognized when the performance obligations are satisfied. We satisfy our obligation and recognize revenue for on-premise licenses upon transfer of control of the software, which occurs at delivery of the license key to customers, or when the license term commences, if later. We satisfy our cloud service performance obligation over the associated contract term and recognize the associated revenue ratably over the term of the contract once access is provided to the customer, consistent with the pattern of benefit to the customer of such services. We satisfy our maintenance and support performance obligations and recognize revenue ratably over the maintenance and support term, consistent with the pattern of benefit to the customer of such services. Professional services and training are either provided on a time and material basis or over a contract term. We satisfy our professional services and training performance obligations and recognize the associated revenue as services are delivered. 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. Customers can purchase our products under different pricing options. Regardless of the pricing option selected, the consideration for our license and cloud contracts is fixed and does not result in variable consideration. 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 when we have an unconditional right to payment, either because we satisfied a performance obligation prior to receiving payment from the customer or we have a non-cancelable contract that has been invoiced in advance in accordance with our standard payment terms. Most of our multi-year on-premises term license and cloud services contracts are invoiced annually. A receivable for multi-year cloud services is generally recorded upon invoicing. A receivable for multi-year on-premises term licenses is recorded upon delivery, whether or not invoiced, to the extent we have an unconditional right to receive payment in the future related to those licenses. The non-current portion of these receivables, primarily consisting of unbilled receivables from on-premises term licenses, is included in “Accounts receivable, non-current” on our condensed consolidated balance sheets. Payment terms and conditions vary by contract type, although our standard payment terms generally require 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 generally 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 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 Accounting Standards Update (“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 available-for-sale securities. We adopted this new standard as of February 1, 2020, using the modified prospective method recognized as of the date of initial application. Under this method, we are not required to restate or disclose the effects of applying Topic 326 for comparative periods. The adoption of this new standard did not have a material impact on our condensed consolidated financial statements. Recently Issued Accounting Pronouncements Standard Description Effective Date Effect on the Condensed Consolidated Financial Statements ASU No. 2019-12, Income Taxes (Topic 740), Simplifying the Accounting for Income Taxes The amendments in this ASU simplify the accounting for incomes taxes by removing certain exceptions to the general principles in Topic 740 and clarifying and amending existing guidance to improve consistent application. Most amendments within this standard are required to be applied on a prospective basis, while certain amendments must be applied on a retrospective or modified retrospective basis. First quarter of fiscal 2022. We are currently evaluating the impact of this standard on our condensed consolidated financial statements. |
Investments and Fair Value Meas
Investments and Fair Value Measurements | 3 Months Ended |
Apr. 30, 2020 | |
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: April 30, 2020 January 31, 2020 (In thousands) Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Assets: Money market funds $ 329,321 $ — $ — $ 329,321 $ 138,999 $ — $ — $ 138,999 U.S. treasury securities — 730,619 — 730,619 — 875,180 — 875,180 Corporate bonds — 103,448 — 103,448 — 124,972 — 124,972 Commercial paper — — — — — 4,994 — 4,994 Other — — 2,000 2,000 — — 2,000 2,000 Reported as: Assets: Cash and cash equivalents $ 329,321 $ 147,034 Investments, current 834,067 976,508 Investments, non-current 2,000 22,603 Total $ 1,165,388 $ 1,146,145 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 April 30, 2020: (In thousands) Amortized Cost Unrealized Gains Unrealized Losses Fair Value Investments, current: U.S. treasury securities $ 726,104 $ 4,515 $ — $ 730,619 Corporate bonds 102,772 677 (1) 103,448 Total available-for-sale investments $ 828,876 $ 5,192 $ (1) $ 834,067 The following table presents our available-for-sale investments as of January 31, 2020: (In thousands) Amortized Cost Unrealized Gains Unrealized Losses Fair Value Cash and cash equivalents: U.S. treasury securities $ 8,035 $ — $ — $ 8,035 Investments, current: U.S. treasury securities 866,578 590 (23) 867,145 Corporate bonds 103,848 521 — 104,369 Commercial paper 4,991 3 — 4,994 Investments, non-current: Corporate bonds 20,444 159 — 20,603 Total available-for-sale investments $ 1,003,896 $ 1,273 $ (23) $ 1,005,146 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 April 30, 2020 Corporate bonds $ — $ — $ 3,500 $ (1) $ 3,500 $ (1) Total $ — $ — $ 3,500 $ (1) $ 3,500 $ (1) January 31, 2020 U.S. treasury securities $ 129,149 $ (23) $ — $ — $ 129,149 $ (23) Corporate bonds 7,504 — — — 7,504 — Total $ 136,653 $ (23) $ — $ — $ 136,653 $ (23) As of April 30, 2020 and January 31, 2020, we did not consider any of our investments to be impaired. The contractual maturities of our investments are as follows: (In thousands) April 30, 2020 Due within one year $ 834,067 Total $ 834,067 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 included in “Investments, non-current” on our condensed consolidated balance sheets. The following table provides a summary of our equity investments: (In thousands) April 30, 2020 January 31, 2020 Equity investments without readily determinable fair values $ 12,744 $ 10,744 Equity investments under the equity method of accounting 2,398 2,023 Total $ 15,142 $ 12,767 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Apr. 30, 2020 | |
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 April 30, 2020. We are unable to estimate the maximum potential impact of these indemnifications on our future results of operations. |
Leases
Leases | 3 Months Ended |
Apr. 30, 2020 | |
Leases [Abstract] | |
Leases | Leases We have operating leases for office space, used for our business operations and sales support, and data centers, used primarily for product development. Operating lease costs were $17.8 million, excluding short-term lease costs of $3.2 million. Operating lease costs also exclude variable lease costs and sublease income which were immaterial during the three months ended April 30, 2020. Operating lease costs were $11.3 million, excluding short-term leases, variable lease costs and sublease income, which were immaterial, during the three months ended April 30, 2019. Our lease term and the discount rate related to our operating lease right-of-use assets and related lease liabilities are as follows: April 30, 2020 Weighted-average remaining lease term (in years) 8.95 Weighted-average discount rate 5.98 % As of April 30, 2020, the maturity of lease liabilities under our non-cancelable operating leases were as follows: Fiscal Period (In thousands) Future Payments Remaining fiscal 2021 $ 37,046 Fiscal 2022 70,727 Fiscal 2023 66,273 Fiscal 2024 55,545 Fiscal 2025 49,155 Thereafter 280,797 Total lease payments 559,543 Less imputed interest (137,018) Total current and non-current operating lease liabilities (1) $ 422,525 _________________________ (1) The current portion of our operating lease liabilities is included in “Accrued expenses and other liabilities” on our condensed consolidated balance sheets. As of April 30, 2020, we have entered into leases, primarily for office space that have not yet commenced, with future lease payments of $9.1 million that are not reflected in the above. These leases will commence between fiscal 2021 and fiscal 2022 with non-cancelable lease terms of 2 years to 11 years. Supplemental Disclosures Three Months Ended April 30, (In thousands) 2020 2019 Cash paid for operating lease liabilities $ 7,533 $ 9,751 Operating lease liabilities arising from obtaining right-of-use assets 143,890 9,916 |
Property and Equipment
Property and Equipment | 3 Months Ended |
Apr. 30, 2020 | |
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) April 30, 2020 January 31, 2020 Computer equipment and software $ 100,361 $ 109,892 Furniture and fixtures 31,391 28,568 Leasehold and building improvements (1) 161,012 141,965 Property and equipment, gross 292,764 280,425 Less: accumulated depreciation and amortization (124,543) (123,497) Property and equipment, net $ 168,221 $ 156,928 _________________________ (1) Includes costs related to assets not yet placed into service of $66.5 million and $46.5 million, as of April 30, 2020 and January 31, 2020, respectively. Depreciation and amortization expense of Property and equipment, net was $5.8 million and $6.3 million for the three months ended April 30, 2020 and 2019, respectively. Geographic Information The following table presents our long-lived assets, which consist of property and equipment, net of depreciation and amortization, and operating lease right-of-use assets by geographic region: (In thousands) April 30, 2020 January 31, 2020 United States $ 497,338 $ 362,586 International 69,535 61,428 Total long-lived assets $ 566,873 $ 424,014 |
Acquisitions, Goodwill and Inta
Acquisitions, Goodwill and Intangible Assets | 3 Months Ended |
Apr. 30, 2020 | |
Business Combinations [Abstract] | |
Acquisition, Goodwill and Intangible Assets | Acquisitions, Goodwill and Intangible Assets Fiscal 2020 Acquisitions SignalFx On October 1, 2019, we acquired 100% of the voting equity interest of SignalFx, Inc. (“SignalFx”), a privately-held Delaware corporation that develops real-time monitoring solutions for cloud infrastructure, microservices and applications. This acquisition has been accounted for as a business combination. The total fair value of consideration transferred for this acquisition was $961.4 million, which consisted of $619.1 million in cash, $324.5 million for the fair value of 2,771,482 shares of our common stock issued and $17.8 million in fair value of replacement equity awards attributable to pre-acquisition service. The purchase price was allocated as follows: $173.7 million to identified intangible assets, $62.1 million to net assets acquired and $3.3 million to net deferred tax liabilities, with the excess $728.9 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 SignalFx have been included in our condensed consolidated financial statements from the date of purchase. Per the terms of the merger agreement with SignalFx, certain unvested stock options, restricted stock units and restricted stock awards held by SignalFx employees were canceled and exchanged for replacement equity awards under our 2012 Equity Incentive Plan. Additionally, certain shares of stock issued pursuant to share-based compensation awards held by key employees of SignalFx 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 SignalFx’s employees represented a component of the total purchase consideration, as discussed above. The remaining fair value of $104.7 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. We are still finalizing the allocation of the purchase price, which may be subject to change as additional information becomes available to us. 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 $ 108,800 84 Customer relationships 60,900 60 Other acquired intangible assets 4,000 36 Total intangible assets acquired $ 173,700 We applied significant judgment in determining the fair value of the intangible assets acquired, which involved the use of significant estimates and assumptions with respect to revenue growth rates, royalty rate and technology migration curve. Omnition On September 13, 2019, we acquired 100% of the voting equity interest of Cloud Native Labs, Inc. (“Omnition”), a privately-held Delaware corporation that develops a platform for distributed tracing and application monitoring. This acquisition has been accounted for as a business combination. The total fair value of consideration transferred for this acquisition was $52.5 million, which consisted of $31.6 million in cash, $20.2 million for the fair value of 176,989 shares of our common stock issued and $0.7 million in fair value of replacement equity awards attributable to pre-acquisition service. The purchase price was allocated to $8.0 million of identified intangible assets, with the excess $44.5 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 Omnition which are not material, have been included in our condensed consolidated financial statements from the date of purchase. Per the terms of the merger agreement with Omnition, certain unvested stock options held by Omnition employees were canceled and exchanged for replacement stock options under our 2012 Equity Incentive Plan. Additionally, certain shares of stock issued pursuant to share-based compensation awards held by key employees of Omnition were canceled and exchanged for replacement equity awards subject to vesting. The portion of the fair value of the replacement equity awards associated with pre-acquisition service of Omnition’s employees represented a component of the total purchase consideration, as discussed above. The remaining fair value of $36.6 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. We are still finalizing the allocation of the purchase price, which may be subject to change as additional information becomes available to us. 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 $ 8,000 60 Total intangible assets acquired $ 8,000 Streamlio On November 1, 2019, we acquired 100% of the voting equity interest of Streamlio, Inc. (“Streamlio”), a privately-held Delaware corporation that specializes in designing and operating streaming data solutions. This acquisition has been accounted for as a business combination. The total fair value of consideration transferred for this acquisition was $19.8 million, which consisted of $18.7 million in cash and $1.1 million in fair value of replacement equity awards attributable to pre-acquisition service. The purchase price was allocated as follows: $3.6 million to identified intangible assets and $0.1 million to net assets acquired, with the excess $16.1 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 Streamlio have been included in our condensed consolidated financial statements from the date of purchase. Per the terms of the merger agreement with Streamlio, certain unvested stock options held by Streamlio employees were canceled and exchanged for replacement stock options under our 2012 Equity Incentive Plan. Additionally, certain shares of stock issued pursuant to share-based compensation awards held by key employees of Streamlio were canceled and exchanged for replacement equity awards consisting of 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 Streamlio’s employees represented a component of the total purchase consideration, as discussed above. The remaining fair value of $4.2 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. We are still finalizing the allocation of the purchase price, which may be subject to change as additional information becomes available to us. 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 $ 3,600 36 Total intangible assets acquired $ 3,600 Goodwill There were no impairments to goodwill during the three months ended April 30, 2020 or during prior periods. Intangible Assets Intangible assets subject to amortization realized from acquisitions as of April 30, 2020 are as follows: (In thousands, except useful life) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Weighted-Average Remaining Useful Life Developed technology $ 252,530 $ (97,485) $ 155,045 66 Customer relationships 81,810 (16,403) 65,407 50 Other acquired intangible assets 7,270 (4,038) 3,232 29 Total intangible assets subject to amortization $ 341,610 $ (117,926) $ 223,684 Intangible assets subject to amortization realized from acquisitions as of January 31, 2020 are as follows: (In thousands, except useful life) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Weighted-Average Remaining Useful Life Developed technology $ 252,530 $ (87,112) $ 165,418 68 Customer relationships 81,810 (12,403) 69,407 53 Other acquired intangible assets 7,270 (3,680) 3,590 32 Total intangible assets subject to amortization $ 341,610 $ (103,195) $ 238,415 Amortization expense from acquired intangible assets was $14.7 million and $7.1 million for the three months ended April 30, 2020 and 2019, respectively. The expected future amortization expense for acquired intangible assets as of April 30, 2020 is as follows: Fiscal Period (In thousands) Expected Amortization Expense Remaining fiscal 2021 $ 40,975 Fiscal 2022 45,567 Fiscal 2023 41,525 Fiscal 2024 37,015 Fiscal 2025 31,182 Thereafter 27,420 Total amortization expense $ 223,684 |
Convertible Senior Notes
Convertible Senior Notes | 3 Months Ended |
Apr. 30, 2020 | |
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 the 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 April 30, 2020, the conditions allowing holders of the Notes to convert were not met. The Notes were therefore not convertible during the three months ended April 30, 2020 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 April 30, 2020 was as follows: (In thousands) 2023 Notes 2025 Notes Liability component: Principal amount $ 1,265,000 $ 862,500 Unamortized discount (188,675) (191,156) Unamortized issuance costs (7,363) (5,260) Net carrying amount $ 1,068,962 $ 666,084 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 April 30, (In thousands) 2020 2019 2023 Notes: Coupon interest expense $ 1,581 $ 1,581 Amortization of debt discount (conversion option) 12,418 11,595 Amortization of debt issuance costs and purchase discounts 485 453 Total interest expense related to the 2023 Notes $ 14,484 $ 13,629 2025 Notes: Coupon interest expense $ 2,426 $ 2,426 Amortization of debt discount (conversion option) 7,312 6,771 Amortization of debt issuance costs and purchase discounts 201 186 Total interest expense related to the 2025 Notes $ 9,939 $ 9,383 As of April 30, 2020, the total estimated fair values of the 2023 Notes and the 2025 Notes were approximately $1.46 billion and $1.02 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 |
Stock Compensation Plans
Stock Compensation Plans | 3 Months Ended |
Apr. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Stock Compensation Plans | Stock Compensation Plans The following table summarizes the stock option, restricted stock unit (“RSU”), restricted stock award (“RSA”) and performance unit (“PSU”) award activity under our 2012 Equity Incentive Plan during the three months ended April 30, 2020: Options Outstanding RSUs and PSUs Shares Available Shares Weighted- Weighted- Aggregate Intrinsic Value (1) Shares (in years) (in thousands) Balances as of January 31, 2020 19,328,502 823,541 $ 10.79 6.61 $ 118,978 13,141,650 Additional shares authorized 7,889,377 Options exercised (174,182) 8.14 20,889 Options forfeited and expired 41,563 (41,563) 12.69 RSUs and PSUs granted (1,373,313) 1,373,313 RSUs and PSUs vested (1,251,916) Shares withheld related to net share settlement of RSUs and PSUs 372,335 RSUs and PSUs forfeited and canceled 456,310 (456,310) Balances as of April 30, 2020 26,714,774 607,796 $ 11.42 6.45 $ 78,370 12,806,737 Vested and expected to vest 586,862 $ 11.42 6.38 $ 75,672 11,923,564 Exercisable as of April 30, 2020 238,276 $ 11.72 3.55 $ 30,652 _________________________ (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 April 30, 2020. During the three months ended April 30, 2020 and 2019, upon each settlement date of our outstanding RSUs to current employees, RSUs were withheld to cover the required withholding tax, which was based on the value of the RSU on the settlement date as determined by the closing price of our common stock on the trading day of the applicable settlement date. The remaining shares were delivered to the recipient as shares of our common stock. The amount remitted to the tax authorities for the employees’ tax obligation was reflected as a financing activity on our condensed consolidated statements of cash flows. These shares withheld by us as a result of the net settlement of RSUs were not considered issued and outstanding, thereby reducing our shares outstanding used to calculate earnings per share. These shares were returned to the reserves and are available for future issuance under our 2012 Equity Incentive Plan. During the three months ended April 30, 2020, we granted 318,514 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 April 30, 2020, total unrecognized compensation cost related to stock options was $35.4 million, which is expected to be recognized over a weighted-average period of 2.2 years. As of April 30, 2020, total unrecognized compensation cost was $1.16 billion related to RSUs, which is expected to be recognized over the next 2.8 years. As of April 30, 2020, total unrecognized compensation cost was $92.2 million related to PSUs, which is expected to be recognized over the next 2.7 years. As of April 30, 2020, total unrecognized compensation cost related to RSAs was $58.1 million, which is expected to be recognized over the next 2.1 years. The following table summarizes our RSA activity during the three months ended April 30, 2020: Shares Outstanding as of January 31, 2020 857,793 RSAs vested (72,304) Outstanding as of April 30, 2020 785,489 The weighted-average grant date fair value of RSUs granted was $129.59 during the three months ended April 30, 2020. The weighted-average grant date fair value of PSUs granted was $136.75 per share during the three months ended April 30, 2020. |
Revenues, Accounts Receivable,
Revenues, Accounts Receivable, Deferred Revenue and Remaining Performance Obligations | 3 Months Ended |
Apr. 30, 2020 | |
Segment Reporting [Abstract] | |
Revenues, Accounts Receivable, Deferred Revenue and Remaining Performance Obligations | Revenues, Accounts Receivable, Deferred Revenue and Remaining Performance Obligations Disaggregation of Revenues The following table presents disaggregated revenues by major product or service type: Three Months Ended April 30, (In thousands) 2020 2019 Revenues License $ 148,385 $ 202,862 Cloud services 112,152 62,055 Maintenance, professional services and training 173,540 159,933 Total revenues $ 434,077 $ 424,850 Revenues by geography are based on the shipping address of the customer. The following table presents our revenues by geographic region: Three Months Ended April 30, (In thousands) 2020 2019 United States $ 283,132 $ 312,356 International 150,945 112,494 Total revenues $ 434,077 $ 424,850 The following table presents revenues by channel partners representing 10% or more of total revenues: Three Months Ended April 30, (In thousands) 2020 2019 Channel Partner A 29 % 32 % Channel Partner B 14 % 19 % 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 during the three months ended April 30, 2020 and 2019, respectively. Accounts Receivable The following table presents total current and non-current accounts receivable by channel partners representing 10% or more of total current and non-current accounts receivable: (In thousands) April 30, 2020 January 31, 2020 Channel Partner A 19 % 27 % Channel Partner B 9 % 13 % The COVID-19 pandemic and the recent economic downturn prompted us to perform additional credit reviews of our existing customers. After performing our additional reviews using a current expected credit loss model, we determined that, while there may be delays in our collections, the risk of credit loss on our accounts receivable as of April 30, 2020 was expected to be materially consistent with prior periods. Deferred Revenue Revenues recognized from amounts included in deferred revenue as of January 31, 2020 and 2019 were $254.6 million and $221.9 million during the three months ended April 30, 2020 and 2019, 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 $1.72 billion as of April 30, 2020, of which we expect to recognize approximately 58% as revenue over the next 12 months and the remainder thereafter. |
Income Taxes
Income Taxes | 3 Months Ended |
Apr. 30, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes We are subject to income taxes in the U.S. and in foreign jurisdictions. We base our interim tax accruals on an estimated annual effective tax rate applied to year-to-date income, and we record discrete tax items in the period to which they relate. In each quarter, we update our estimated annual effective tax rate and make a year-to-date adjustment to our tax provision as necessary. Our fiscal 2021 annual effective rate differs from the U.S. statutory rate primarily due to the valuation allowance recorded on our U.S. losses. For the three months ended April 30, 2020 and 2019, we recorded a $1.7 million income tax benefit and a $3.2 million income tax expense, respectively. On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was enacted. The CARES Act contains numerous income tax provisions, such as changes to carry overs of net operating losses, changes in interest deductibility limits and technical corrections, including one impacting depreciation of Qualified Improvement Property. We recorded an immaterial benefit during the quarter as a result of the change in the depreciation of Qualified Improvement Property. We continue to evaluate aspects of the CARES Act and any resulting effects. During the three months ended April 30, 2020, there were no material changes to our unrecognized tax benefits, and we do not expect material changes in our unrecognized tax benefits within the next twelve months. Because of our history of tax losses, all years remain open to tax audit. |
Net Loss Per Share
Net Loss Per Share | 3 Months Ended |
Apr. 30, 2020 | |
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 April 30, (In thousands, except per share amounts) 2020 2019 Numerator: Net loss $ (305,579) $ (155,429) Denominator: Weighted-average common shares outstanding 158,350 149,736 Less: Weighted-average unvested common shares subject to repurchase or forfeiture (816) (676) Weighted-average shares used to compute net loss per share, basic and diluted 157,534 149,060 Net loss per share, basic and diluted $ (1.94) $ (1.04) 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 April 30, (In thousands) 2020 2019 Shares subject to outstanding common stock options 608 353 Shares subject to outstanding RSUs, PSUs and RSAs 13,592 13,128 Employee stock purchase plan 610 720 Total 14,810 14,201 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. |
Description of the Business a_2
Description of the Business and Significant Accounting Policies (Policies) | 3 Months Ended |
Apr. 30, 2020 | |
Accounting Policies [Abstract] | |
Business Description and Basis of Presentation | Business Splunk Inc. (“we,” “us,” “our”) provides innovative software solutions that ingest data from different sources including systems, devices and interactions, and turn that data into meaningful business insights across the organization. Our Data-to-Everything platform enables users to investigate, monitor, analyze and act on data regardless of format or source. 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 business transactions, customer and user behavior, and security threats. Our Data-to-Everything platform helps organizations gain the value contained in data by delivering real-time information to enable operational decision making. 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 2021, for example, refer to the fiscal year ending January 31, 2021. |
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, 2020 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, 2020, filed with the SEC on March 26, 2020. 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 2021. |
Reclassifications | Reclassifications Certain reclassifications have been made to prior period balances in order to conform to the current period presentation. “Cloud services” revenues have been reclassified from “Maintenance and services” revenues on our condensed consolidated statements of operations and “Non-cash operating lease costs” have been reclassified from “Accrued expenses and other liabilities” in our condensed consolidated statement of cash flows. These reclassifications had no impact on our previously reported total revenues and net cash flows from operating, investing, or financing activities. |
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. |
COVID-19 | COVID-19 The worldwide spread of COVID-19 has resulted in a global slowdown of economic activity which is likely to decrease demand for a broad variety of goods and services, while also disrupting sales channels, marketing activities and general business operations for an unknown period of time until the disease is contained. At this point, the extent to which COVID-19 may impact our financial condition or results of operations is uncertain, and as of the date of issuance of those financial statements, we are not aware of any specific event or circumstance that would require us to update our estimates, judgments or adjust the carrying value of our assets or liabilities. These estimates may change, as new events occur and additional information is obtained, and are recognized in the condensed consolidated financial statements as soon as they become known. Actual results could differ from those estimates and any such differences may be material to our financial statements. |
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 business insights 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. |
Foreign Currency | Foreign Currency The functional currency of our foreign subsidiaries is their respective local currency, with the exception of our United Kingdom subsidiary, for 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. Our contracts with customers often contain multiple performance obligations, which may include a combination of on-premise software licenses, related maintenance and support services, cloud services and professional services including training. We apply significant judgment in identifying and accounting for each performance obligation, as a result of evaluating the terms and conditions in contracts. For these contracts, we account for on-premise licenses, maintenance and support, cloud services and other services as separate performance obligations as they are each distinct. Revenue is recognized when the performance obligations are satisfied. We satisfy our obligation and recognize revenue for on-premise licenses upon transfer of control of the software, which occurs at delivery of the license key to customers, or when the license term commences, if later. We satisfy our cloud service performance obligation over the associated contract term and recognize the associated revenue ratably over the term of the contract once access is provided to the customer, consistent with the pattern of benefit to the customer of such services. We satisfy our maintenance and support performance obligations and recognize revenue ratably over the maintenance and support term, consistent with the pattern of benefit to the customer of such services. Professional services and training are either provided on a time and material basis or over a contract term. We satisfy our professional services and training performance obligations and recognize the associated revenue as services are delivered. 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. Customers can purchase our products under different pricing options. Regardless of the pricing option selected, the consideration for our license and cloud contracts is fixed and does not result in variable consideration. 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 when we have an unconditional right to payment, either because we satisfied a performance obligation prior to receiving payment from the customer or we have a non-cancelable contract that has been invoiced in advance in accordance with our standard payment terms. Most of our multi-year on-premises term license and cloud services contracts are invoiced annually. A receivable for multi-year cloud services is generally recorded upon invoicing. A receivable for multi-year on-premises term licenses is recorded upon delivery, whether or not invoiced, to the extent we have an unconditional right to receive payment in the future related to those licenses. The non-current portion of these receivables, primarily consisting of unbilled receivables from on-premises term licenses, is included in “Accounts receivable, non-current” on our condensed consolidated balance sheets. Payment terms and conditions vary by contract type, although our standard payment terms generally require 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 generally 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 licenses that we delivered prior to the license term commencing. |
Recently Issued Accounting Pronouncements | Recently Adopted Accounting Standards Standard Description Effective Date Effect on the Condensed Consolidated Financial Statements Accounting Standards Update (“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 available-for-sale securities. We adopted this new standard as of February 1, 2020, using the modified prospective method recognized as of the date of initial application. Under this method, we are not required to restate or disclose the effects of applying Topic 326 for comparative periods. The adoption of this new standard did not have a material impact on our condensed consolidated financial statements. Recently Issued Accounting Pronouncements Standard Description Effective Date Effect on the Condensed Consolidated Financial Statements ASU No. 2019-12, Income Taxes (Topic 740), Simplifying the Accounting for Income Taxes The amendments in this ASU simplify the accounting for incomes taxes by removing certain exceptions to the general principles in Topic 740 and clarifying and amending existing guidance to improve consistent application. Most amendments within this standard are required to be applied on a prospective basis, while certain amendments must be applied on a retrospective or modified retrospective basis. First quarter of fiscal 2022. We are currently evaluating the impact of this standard on our condensed consolidated financial statements. |
Description of the Business a_3
Description of the Business and Significant Accounting Policies New Accounting Pronouncements (Tables) | 3 Months Ended |
Apr. 30, 2020 | |
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 Accounting Standards Update (“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 available-for-sale securities. We adopted this new standard as of February 1, 2020, using the modified prospective method recognized as of the date of initial application. Under this method, we are not required to restate or disclose the effects of applying Topic 326 for comparative periods. The adoption of this new standard did not have a material impact on our condensed consolidated financial statements. Recently Issued Accounting Pronouncements Standard Description Effective Date Effect on the Condensed Consolidated Financial Statements ASU No. 2019-12, Income Taxes (Topic 740), Simplifying the Accounting for Income Taxes The amendments in this ASU simplify the accounting for incomes taxes by removing certain exceptions to the general principles in Topic 740 and clarifying and amending existing guidance to improve consistent application. Most amendments within this standard are required to be applied on a prospective basis, while certain amendments must be applied on a retrospective or modified retrospective basis. First quarter of fiscal 2022. We are currently evaluating the impact of this standard on our condensed consolidated financial statements. |
Investments and Fair Value Me_2
Investments and Fair Value Measurements (Tables) | 3 Months Ended |
Apr. 30, 2020 | |
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: April 30, 2020 January 31, 2020 (In thousands) Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Assets: Money market funds $ 329,321 $ — $ — $ 329,321 $ 138,999 $ — $ — $ 138,999 U.S. treasury securities — 730,619 — 730,619 — 875,180 — 875,180 Corporate bonds — 103,448 — 103,448 — 124,972 — 124,972 Commercial paper — — — — — 4,994 — 4,994 Other — — 2,000 2,000 — — 2,000 2,000 Reported as: Assets: Cash and cash equivalents $ 329,321 $ 147,034 Investments, current 834,067 976,508 Investments, non-current 2,000 22,603 Total $ 1,165,388 $ 1,146,145 |
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 April 30, 2020: (In thousands) Amortized Cost Unrealized Gains Unrealized Losses Fair Value Investments, current: U.S. treasury securities $ 726,104 $ 4,515 $ — $ 730,619 Corporate bonds 102,772 677 (1) 103,448 Total available-for-sale investments $ 828,876 $ 5,192 $ (1) $ 834,067 The following table presents our available-for-sale investments as of January 31, 2020: (In thousands) Amortized Cost Unrealized Gains Unrealized Losses Fair Value Cash and cash equivalents: U.S. treasury securities $ 8,035 $ — $ — $ 8,035 Investments, current: U.S. treasury securities 866,578 590 (23) 867,145 Corporate bonds 103,848 521 — 104,369 Commercial paper 4,991 3 — 4,994 Investments, non-current: Corporate bonds 20,444 159 — 20,603 Total available-for-sale investments $ 1,003,896 $ 1,273 $ (23) $ 1,005,146 |
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 April 30, 2020 Corporate bonds $ — $ — $ 3,500 $ (1) $ 3,500 $ (1) Total $ — $ — $ 3,500 $ (1) $ 3,500 $ (1) January 31, 2020 U.S. treasury securities $ 129,149 $ (23) $ — $ — $ 129,149 $ (23) Corporate bonds 7,504 — — — 7,504 — Total $ 136,653 $ (23) $ — $ — $ 136,653 $ (23) |
Investments classified by contractual maturity date | The contractual maturities of our investments are as follows: (In thousands) April 30, 2020 Due within one year $ 834,067 Total $ 834,067 |
Schedule of equity investments | The following table provides a summary of our equity investments: (In thousands) April 30, 2020 January 31, 2020 Equity investments without readily determinable fair values $ 12,744 $ 10,744 Equity investments under the equity method of accounting 2,398 2,023 Total $ 15,142 $ 12,767 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Apr. 30, 2020 | |
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: April 30, 2020 Weighted-average remaining lease term (in years) 8.95 Weighted-average discount rate 5.98 % Supplemental Disclosures Three Months Ended April 30, (In thousands) 2020 2019 Cash paid for operating lease liabilities $ 7,533 $ 9,751 Operating lease liabilities arising from obtaining right-of-use assets 143,890 9,916 |
Maturity of Lease Liabilities | As of April 30, 2020, the maturity of lease liabilities under our non-cancelable operating leases were as follows: Fiscal Period (In thousands) Future Payments Remaining fiscal 2021 $ 37,046 Fiscal 2022 70,727 Fiscal 2023 66,273 Fiscal 2024 55,545 Fiscal 2025 49,155 Thereafter 280,797 Total lease payments 559,543 Less imputed interest (137,018) Total current and non-current operating lease liabilities (1) $ 422,525 _________________________ (1) The current portion of our operating lease liabilities is included in “Accrued expenses and other liabilities” on our condensed consolidated balance sheets. |
Property and Equipment (Tables)
Property and Equipment (Tables) | 3 Months Ended |
Apr. 30, 2020 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and equipment consisted of the following: (In thousands) April 30, 2020 January 31, 2020 Computer equipment and software $ 100,361 $ 109,892 Furniture and fixtures 31,391 28,568 Leasehold and building improvements (1) 161,012 141,965 Property and equipment, gross 292,764 280,425 Less: accumulated depreciation and amortization (124,543) (123,497) Property and equipment, net $ 168,221 $ 156,928 _________________________ (1) |
Long-Lived Assets by Geographic Areas | The following table presents our long-lived assets, which consist of property and equipment, net of depreciation and amortization, and operating lease right-of-use assets by geographic region: (In thousands) April 30, 2020 January 31, 2020 United States $ 497,338 $ 362,586 International 69,535 61,428 Total long-lived assets $ 566,873 $ 424,014 |
Acquisitions, Goodwill and In_2
Acquisitions, Goodwill and Intangible Assets (Tables) | 3 Months Ended |
Apr. 30, 2020 | |
Goodwill | |
Schedule of finite-lived intangible assets | Intangible assets subject to amortization realized from acquisitions as of April 30, 2020 are as follows: (In thousands, except useful life) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Weighted-Average Remaining Useful Life Developed technology $ 252,530 $ (97,485) $ 155,045 66 Customer relationships 81,810 (16,403) 65,407 50 Other acquired intangible assets 7,270 (4,038) 3,232 29 Total intangible assets subject to amortization $ 341,610 $ (117,926) $ 223,684 Intangible assets subject to amortization realized from acquisitions as of January 31, 2020 are as follows: (In thousands, except useful life) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Weighted-Average Remaining Useful Life Developed technology $ 252,530 $ (87,112) $ 165,418 68 Customer relationships 81,810 (12,403) 69,407 53 Other acquired intangible assets 7,270 (3,680) 3,590 32 Total intangible assets subject to amortization $ 341,610 $ (103,195) $ 238,415 |
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 April 30, 2020 is as follows: Fiscal Period (In thousands) Expected Amortization Expense Remaining fiscal 2021 $ 40,975 Fiscal 2022 45,567 Fiscal 2023 41,525 Fiscal 2024 37,015 Fiscal 2025 31,182 Thereafter 27,420 Total amortization expense $ 223,684 |
SignalFx | |
Goodwill | |
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 $ 108,800 84 Customer relationships 60,900 60 Other acquired intangible assets 4,000 36 Total intangible assets acquired $ 173,700 We applied significant judgment in determining the fair value of the intangible assets acquired, which involved the use of significant estimates and assumptions with respect to revenue growth rates, royalty rate and technology migration curve. |
Omnition | |
Goodwill | |
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 $ 8,000 60 Total intangible assets acquired $ 8,000 |
Streamlio | |
Goodwill | |
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 $ 3,600 36 Total intangible assets acquired $ 3,600 |
Convertible Senior Notes (Table
Convertible Senior Notes (Tables) | 3 Months Ended |
Apr. 30, 2020 | |
Debt Disclosure [Abstract] | |
Convertible Senior Notes | The net carrying amount of the liability and equity components for each of the Notes as of April 30, 2020 was as follows: (In thousands) 2023 Notes 2025 Notes Liability component: Principal amount $ 1,265,000 $ 862,500 Unamortized discount (188,675) (191,156) Unamortized issuance costs (7,363) (5,260) Net carrying amount $ 1,068,962 $ 666,084 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 April 30, (In thousands) 2020 2019 2023 Notes: Coupon interest expense $ 1,581 $ 1,581 Amortization of debt discount (conversion option) 12,418 11,595 Amortization of debt issuance costs and purchase discounts 485 453 Total interest expense related to the 2023 Notes $ 14,484 $ 13,629 2025 Notes: Coupon interest expense $ 2,426 $ 2,426 Amortization of debt discount (conversion option) 7,312 6,771 Amortization of debt issuance costs and purchase discounts 201 186 Total interest expense related to the 2025 Notes $ 9,939 $ 9,383 |
Stock Compensation Plans (Table
Stock Compensation Plans (Tables) | 3 Months Ended |
Apr. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Stock Option and RSU Award Activity | The following table summarizes the stock option, restricted stock unit (“RSU”), restricted stock award (“RSA”) and performance unit (“PSU”) award activity under our 2012 Equity Incentive Plan during the three months ended April 30, 2020: Options Outstanding RSUs and PSUs Shares Available Shares Weighted- Weighted- Aggregate Intrinsic Value (1) Shares (in years) (in thousands) Balances as of January 31, 2020 19,328,502 823,541 $ 10.79 6.61 $ 118,978 13,141,650 Additional shares authorized 7,889,377 Options exercised (174,182) 8.14 20,889 Options forfeited and expired 41,563 (41,563) 12.69 RSUs and PSUs granted (1,373,313) 1,373,313 RSUs and PSUs vested (1,251,916) Shares withheld related to net share settlement of RSUs and PSUs 372,335 RSUs and PSUs forfeited and canceled 456,310 (456,310) Balances as of April 30, 2020 26,714,774 607,796 $ 11.42 6.45 $ 78,370 12,806,737 Vested and expected to vest 586,862 $ 11.42 6.38 $ 75,672 11,923,564 Exercisable as of April 30, 2020 238,276 $ 11.72 3.55 $ 30,652 _________________________ (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 April 30, 2020. |
Schedule of RSA Activity | The following table summarizes our RSA activity during the three months ended April 30, 2020: Shares Outstanding as of January 31, 2020 857,793 RSAs vested (72,304) Outstanding as of April 30, 2020 785,489 |
Revenues, Accounts Receivable_2
Revenues, Accounts Receivable, Deferred Revenue and Remaining Performance Obligations, Revenue from Contract with Customer (Tables) | 3 Months Ended |
Apr. 30, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following table presents disaggregated revenues by major product or service type: Three Months Ended April 30, (In thousands) 2020 2019 Revenues License $ 148,385 $ 202,862 Cloud services 112,152 62,055 Maintenance, professional services and training 173,540 159,933 Total revenues $ 434,077 $ 424,850 |
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 April 30, (In thousands) 2020 2019 United States $ 283,132 $ 312,356 International 150,945 112,494 Total revenues $ 434,077 $ 424,850 |
Schedule of Revenue by Channel Partners | The following table presents revenues by channel partners representing 10% or more of total revenues: Three Months Ended April 30, (In thousands) 2020 2019 Channel Partner A 29 % 32 % Channel Partner B 14 % 19 % |
Schedule Of Accounts Receivable by Channel Partners | The following table presents total current and non-current accounts receivable by channel partners representing 10% or more of total current and non-current accounts receivable: (In thousands) April 30, 2020 January 31, 2020 Channel Partner A 19 % 27 % Channel Partner B 9 % 13 % |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 3 Months Ended |
Apr. 30, 2020 | |
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 April 30, (In thousands, except per share amounts) 2020 2019 Numerator: Net loss $ (305,579) $ (155,429) Denominator: Weighted-average common shares outstanding 158,350 149,736 Less: Weighted-average unvested common shares subject to repurchase or forfeiture (816) (676) Weighted-average shares used to compute net loss per share, basic and diluted 157,534 149,060 Net loss per share, basic and diluted $ (1.94) $ (1.04) |
Potentially dilutive securities that were not included in the diluted per share calculations because they would be 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 April 30, (In thousands) 2020 2019 Shares subject to outstanding common stock options 608 353 Shares subject to outstanding RSUs, PSUs and RSAs 13,592 13,128 Employee stock purchase plan 610 720 Total 14,810 14,201 |
Description of the Business a_4
Description of the Business and Significant Accounting Policies (Details) | 3 Months Ended |
Apr. 30, 2020segment | |
Segments | |
Number of operating segments | 1 |
Description of the Business a_5
Description of the Business and Significant Accounting Policies Revenue Recognition (Details 2) | 3 Months Ended |
Apr. 30, 2020 | |
Minimum | |
Revenue Recognition | |
Accounts receivable payment terms | 30 days |
Maximum | |
Revenue Recognition | |
Accounts receivable payment terms | 60 days |
Investments and Fair Value Me_3
Investments and Fair Value Measurements (Details) - USD ($) $ in Thousands | Apr. 30, 2020 | Jan. 31, 2020 |
Fair Value Measurements | ||
U.S. treasury securities, corporate bonds and commercial paper | $ 834,067 | $ 1,005,146 |
Estimate of Fair Value Measurement | Recurring basis | ||
Fair Value Measurements | ||
Money market funds | 329,321 | 138,999 |
Other | 2,000 | 2,000 |
Assets: | ||
Cash and cash equivalents | 329,321 | 147,034 |
Investments, current | 834,067 | 976,508 |
Investments, non-current | 2,000 | 22,603 |
Total | 1,165,388 | 1,146,145 |
Estimate of Fair Value Measurement | Recurring basis | Level 1 | ||
Fair Value Measurements | ||
Money market funds | 329,321 | 138,999 |
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 | 2,000 | 2,000 |
US Treasury Securities | Estimate of Fair Value Measurement | Recurring basis | ||
Fair Value Measurements | ||
U.S. treasury securities, corporate bonds and commercial paper | 730,619 | 875,180 |
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 | 730,619 | 875,180 |
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 | 103,448 | 124,972 |
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 | 103,448 | 124,972 |
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 | 0 | 4,994 |
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 | 0 | 4,994 |
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 | Apr. 30, 2020 | Jan. 31, 2020 |
Debt Securities, Available-for-sale | ||
Amortized Cost | $ 828,876 | $ 1,003,896 |
Unrealized Gains | 5,192 | 1,273 |
Unrealized Losses | (1) | (23) |
Fair Value | 834,067 | 1,005,146 |
Due within one year | 834,067 | |
Cash and Cash Equivalents | US Treasury Securities | ||
Debt Securities, Available-for-sale | ||
Amortized Cost | 8,035 | |
Unrealized Gains | 0 | |
Unrealized Losses | 0 | |
Fair Value | 8,035 | |
Investments, Current | US Treasury Securities | ||
Debt Securities, Available-for-sale | ||
Amortized Cost | 726,104 | 866,578 |
Unrealized Gains | 4,515 | 590 |
Unrealized Losses | 0 | (23) |
Fair Value | 730,619 | 867,145 |
Investments, Current | Corporate Bonds | ||
Debt Securities, Available-for-sale | ||
Amortized Cost | 102,772 | 103,848 |
Unrealized Gains | 677 | 521 |
Unrealized Losses | (1) | 0 |
Fair Value | $ 103,448 | 104,369 |
Investments, Current | Commercial Paper | ||
Debt Securities, Available-for-sale | ||
Amortized Cost | 4,991 | |
Unrealized Gains | 3 | |
Unrealized Losses | 0 | |
Fair Value | 4,994 | |
Investments, Non-current | Corporate Bonds | ||
Debt Securities, Available-for-sale | ||
Amortized Cost | 20,444 | |
Unrealized Gains | 159 | |
Unrealized Losses | 0 | |
Fair Value | $ 20,603 |
Investments and Fair Value Me_5
Investments and Fair Value Measurements - Securities in Unrealized Loss Position (Details) - USD ($) $ in Thousands | Apr. 30, 2020 | Jan. 31, 2020 |
Fair Value | ||
Less than 12 Months | $ 0 | $ 136,653 |
12 Months or Greater | 3,500 | 0 |
Total | 3,500 | 136,653 |
Unrealized Losses | ||
Less than 12 Months | 0 | (23) |
12 Months or Greater | (1) | 0 |
Total | (1) | (23) |
US Treasury Securities | ||
Fair Value | ||
Less than 12 Months | 129,149 | |
12 Months or Greater | 0 | |
Total | 129,149 | |
Unrealized Losses | ||
Less than 12 Months | (23) | |
12 Months or Greater | 0 | |
Total | (23) | |
Corporate Bonds | ||
Fair Value | ||
Less than 12 Months | 0 | 7,504 |
12 Months or Greater | 3,500 | 0 |
Total | 3,500 | 7,504 |
Unrealized Losses | ||
Less than 12 Months | 0 | 0 |
12 Months or Greater | (1) | 0 |
Total | $ (1) | $ 0 |
Investments and Fair Value Me_6
Investments and Fair Value Measurements - Equity Investments (Details) - USD ($) $ in Thousands | Apr. 30, 2020 | Jan. 31, 2020 |
Investments, Debt and Equity Securities and Fair Value Disclosures [Abstract] | ||
Equity investments without readily determinable fair values | $ 12,744 | $ 10,744 |
Equity investments under the equity method of accounting | 2,398 | 2,023 |
Total | $ 15,142 | $ 12,767 |
Leases (Details)
Leases (Details) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 30, 2020 | Apr. 30, 2019 | |
Lessee, Lease, Description | ||
Operating lease cost | $ 17.8 | $ 11.3 |
Short-term lease costs | 3.2 | |
Leases not yet commenced, future lease payments | $ 9.1 | |
Minimum | ||
Lessee, Lease, Description | ||
Term of office lease | 2 years | |
Maximum | ||
Lessee, Lease, Description | ||
Term of office lease | 11 years |
Leases - Lease Term and Discoun
Leases - Lease Term and Discount Rate (Details) | Apr. 30, 2020 |
Leases [Abstract] | |
Weighted-average remaining lease term (in years) | 8 years 11 months 12 days |
Weighted-average discount rate | 5.98% |
Leases - Maturity of Lease Liab
Leases - Maturity of Lease Liability (Details) $ in Thousands | Apr. 30, 2020USD ($) |
Leases [Abstract] | |
Remaining fiscal 2021 | $ 37,046 |
Fiscal 2022 | 70,727 |
Fiscal 2023 | 66,273 |
Fiscal 2024 | 55,545 |
Fiscal 2025 | 49,155 |
Thereafter | 280,797 |
Total lease payments | 559,543 |
Less imputed interest | (137,018) |
Total current and non-current operating lease liabilities | $ 422,525 |
Leases - Supplemental Disclosur
Leases - Supplemental Disclosure (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 30, 2020 | Apr. 30, 2019 | |
Leases [Abstract] | ||
Cash paid for operating lease liabilities | $ 7,533 | $ 9,751 |
Operating lease liabilities arising from obtaining right-of-use assets | $ 143,890 | $ 9,916 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Apr. 30, 2020 | Apr. 30, 2019 | Jan. 31, 2020 | |
Property, Plant and Equipment | |||
Property and equipment, gross | $ 292,764 | $ 280,425 | |
Less: accumulated depreciation and amortization | (124,543) | (123,497) | |
Property and equipment, net | 168,221 | 156,928 | |
Depreciation and amortization expense on Property and Equipment, net | 5,800 | $ 6,300 | |
Computer equipment and software | |||
Property, Plant and Equipment | |||
Property and equipment, gross | 100,361 | 109,892 | |
Furniture and fixtures | |||
Property, Plant and Equipment | |||
Property and equipment, gross | 31,391 | 28,568 | |
Leasehold and building improvements | |||
Property, Plant and Equipment | |||
Property and equipment, gross | 161,012 | 141,965 | |
Leasehold improvements not in service | |||
Property, Plant and Equipment | |||
Property and equipment, gross | $ 66,500 | $ 46,500 |
Property and Equipment (Detai_2
Property and Equipment (Details 2) - USD ($) $ in Thousands | Apr. 30, 2020 | Jan. 31, 2020 |
Property, Plant and Equipment | ||
Long-lived assets | $ 566,873 | $ 424,014 |
United States | ||
Property, Plant and Equipment | ||
Long-lived assets | 497,338 | 362,586 |
International | ||
Property, Plant and Equipment | ||
Long-lived assets | $ 69,535 | $ 61,428 |
Acquisitions, Goodwill and In_3
Acquisitions, Goodwill and Intangible Assets (Details Textual) - USD ($) $ in Thousands | Nov. 01, 2019 | Oct. 01, 2019 | Sep. 13, 2019 | Apr. 30, 2020 | Apr. 30, 2019 | Jan. 31, 2020 |
Business Acquisition | ||||||
Common stock, shares issued | 158,841,311 | 157,787,548 | ||||
Goodwill | $ 1,292,840 | $ 1,292,840 | ||||
Amortization of intangible assets | $ 14,700 | $ 7,100 | ||||
SignalFx | ||||||
Business Acquisition | ||||||
Percentage of voting interests acquired | 100.00% | |||||
Purchase price | $ 961,400 | |||||
Purchase price paid in cash | 619,100 | |||||
Fair value of replacement equity awards attributable to pre-acquisition service | $ 324,500 | |||||
Common stock, shares issued | 2,771,482 | |||||
Fair value of replacement equity awards attributable to pre-acquisition service | $ 17,800 | |||||
Acquired fair value of finite-lived intangible assets | 173,700 | |||||
Net assets acquired | 62,100 | |||||
Net deferred tax liabilities assumed | 3,300 | |||||
Goodwill | 728,900 | |||||
Replacement equity awards | $ 104,700 | |||||
Omnition | ||||||
Business Acquisition | ||||||
Percentage of voting interests acquired | 100.00% | |||||
Purchase price | $ 52,500 | |||||
Purchase price paid in cash | 31,600 | |||||
Fair value of replacement equity awards attributable to pre-acquisition service | $ 20,200 | |||||
Common stock, shares issued | 176,989 | |||||
Fair value of replacement equity awards attributable to pre-acquisition service | $ 700 | |||||
Acquired fair value of finite-lived intangible assets | 8,000 | |||||
Goodwill | 44,500 | |||||
Replacement equity awards | $ 36,600 | |||||
Streamlio | ||||||
Business Acquisition | ||||||
Percentage of voting interests acquired | 100.00% | |||||
Purchase price | $ 19,800 | |||||
Purchase price paid in cash | 18,700 | |||||
Fair value of replacement equity awards attributable to pre-acquisition service | 1,100 | |||||
Acquired fair value of finite-lived intangible assets | 3,600 | |||||
Net assets acquired | 100 | |||||
Goodwill | 16,100 | |||||
Replacement equity awards | $ 4,200 |
Acquisitions, Goodwill and In_4
Acquisitions, Goodwill and Intangible Assets (Details) - USD ($) $ in Thousands | Nov. 01, 2019 | Oct. 01, 2019 | Sep. 13, 2019 | Apr. 30, 2020 | Jan. 31, 2020 |
Finite-Lived and Indefinite-lived Intangible Assets Acquired as Part of Business Combination [Line Items] | |||||
Goodwill | $ 1,292,840 | $ 1,292,840 | |||
Developed technology | |||||
Finite-Lived and Indefinite-lived Intangible Assets Acquired as Part of Business Combination [Line Items] | |||||
Weighted Average Remaining Useful Life | 66 months | 68 months | |||
Customer relationships | |||||
Finite-Lived and Indefinite-lived Intangible Assets Acquired as Part of Business Combination [Line Items] | |||||
Weighted Average Remaining Useful Life | 50 months | 53 months | |||
Other acquired intangible assets | |||||
Finite-Lived and Indefinite-lived Intangible Assets Acquired as Part of Business Combination [Line Items] | |||||
Weighted Average Remaining Useful Life | 29 months | 32 months | |||
SignalFx | |||||
Finite-Lived and Indefinite-lived Intangible Assets Acquired as Part of Business Combination [Line Items] | |||||
Acquired fair value of finite-lived intangible assets | $ 173,700 | ||||
Percentage of voting interests acquired | 100.00% | ||||
Purchase price | $ 961,400 | ||||
Purchase price paid in cash | 619,100 | ||||
Fair value of replacement equity awards attributable to pre-acquisition service | 324,500 | ||||
Acquired fair value of finite-lived intangible assets | 173,700 | ||||
Net assets acquired | 62,100 | ||||
Goodwill | 728,900 | ||||
Replacement equity awards | 104,700 | ||||
SignalFx | 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 | $ 108,800 | ||||
Weighted Average Remaining Useful Life | 84 months | ||||
Acquired fair value of finite-lived intangible assets | $ 108,800 | ||||
SignalFx | 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 | $ 60,900 | ||||
Weighted Average Remaining Useful Life | 60 months | ||||
Acquired fair value of finite-lived intangible assets | $ 60,900 | ||||
SignalFx | Other acquired intangible assets | |||||
Finite-Lived and Indefinite-lived Intangible Assets Acquired as Part of Business Combination [Line Items] | |||||
Acquired fair value of finite-lived intangible assets | $ 4,000 | ||||
Weighted Average Remaining Useful Life | 36 months | ||||
Acquired fair value of finite-lived intangible assets | $ 4,000 | ||||
Omnition | |||||
Finite-Lived and Indefinite-lived Intangible Assets Acquired as Part of Business Combination [Line Items] | |||||
Acquired fair value of finite-lived intangible assets | $ 8,000 | ||||
Percentage of voting interests acquired | 100.00% | ||||
Purchase price | $ 52,500 | ||||
Purchase price paid in cash | 31,600 | ||||
Fair value of replacement equity awards attributable to pre-acquisition service | 20,200 | ||||
Acquired fair value of finite-lived intangible assets | 8,000 | ||||
Goodwill | 44,500 | ||||
Replacement equity awards | 36,600 | ||||
Omnition | 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 | $ 8,000 | ||||
Weighted Average Remaining Useful Life | 60 months | ||||
Acquired fair value of finite-lived intangible assets | $ 8,000 | ||||
Streamlio | |||||
Finite-Lived and Indefinite-lived Intangible Assets Acquired as Part of Business Combination [Line Items] | |||||
Acquired fair value of finite-lived intangible assets | $ 3,600 | ||||
Percentage of voting interests acquired | 100.00% | ||||
Purchase price | $ 19,800 | ||||
Purchase price paid in cash | 18,700 | ||||
Fair value of replacement equity awards attributable to pre-acquisition service | 1,100 | ||||
Acquired fair value of finite-lived intangible assets | 3,600 | ||||
Net assets acquired | 100 | ||||
Goodwill | 16,100 | ||||
Replacement equity awards | 4,200 | ||||
Streamlio | 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 | $ 3,600 | ||||
Weighted Average Remaining Useful Life | 36 months | ||||
Acquired fair value of finite-lived intangible assets | $ 3,600 |
Intangible Assets Amortization
Intangible Assets Amortization (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Apr. 30, 2020 | Jan. 31, 2020 | |
Finite-Lived Intangible Assets | ||
Gross Fair Value | $ 341,610 | $ 341,610 |
Accumulated Amortization | (117,926) | (103,195) |
Total | 223,684 | 238,415 |
Developed technology | ||
Finite-Lived Intangible Assets | ||
Gross Fair Value | 252,530 | 252,530 |
Accumulated Amortization | (97,485) | (87,112) |
Total | $ 155,045 | $ 165,418 |
Weighted Average Remaining Useful Life | 66 months | 68 months |
Customer relationships | ||
Finite-Lived Intangible Assets | ||
Gross Fair Value | $ 81,810 | $ 81,810 |
Accumulated Amortization | (16,403) | (12,403) |
Total | $ 65,407 | $ 69,407 |
Weighted Average Remaining Useful Life | 50 months | 53 months |
Other acquired intangible assets | ||
Finite-Lived Intangible Assets | ||
Gross Fair Value | $ 7,270 | $ 7,270 |
Accumulated Amortization | (4,038) | (3,680) |
Total | $ 3,232 | $ 3,590 |
Weighted Average Remaining Useful Life | 29 months | 32 months |
Intangible Assets Expected Futu
Intangible Assets Expected Future Amortization Expense (Details) - USD ($) $ in Thousands | Apr. 30, 2020 | Jan. 31, 2020 |
Business Combinations [Abstract] | ||
Remaining fiscal 2021 | $ 40,975 | |
Fiscal 2022 | 45,567 | |
Fiscal 2023 | 41,525 | |
Fiscal 2024 | 37,015 | |
Fiscal 2025 | 31,182 | |
Thereafter | 27,420 | |
Total | $ 223,684 | $ 238,415 |
Convertible Senior Notes - Narr
Convertible Senior Notes - Narrative (Details) $ / shares in Units, $ in Thousands | Sep. 21, 2018USD ($)$ / shares | Apr. 30, 2020USD ($)trading_day | Sep. 18, 2018$ / shares |
Debt Instrument | |||
Proceeds from the issuance of convertible senior notes, net of issuance costs | $ 2,110,000 | ||
Purchase of capped calls | $ 274,300 | ||
Minimum | |||
Debt Instrument | |||
Initial conversion price | $ / shares | $ 148.30 | ||
Maximum | |||
Debt Instrument | |||
Initial conversion price | $ / shares | $ 232.62 | ||
Convertible Senior Notes | |||
Debt Instrument | |||
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% | ||
Percentage of stock trigger price for measurement period | 98.00% | ||
Convertible senior notes repurchase price percentage | 100.00% | ||
Convertible Senior Notes | 2023 Notes | |||
Debt Instrument | |||
Principal amount | $ 1,270,000 | $ 1,265,000 | |
Stated interest rate | 0.50% | ||
Option to purchase additional amount | $ 165,000 | ||
Equity component | 264,129 | ||
Unamortized issuance costs | $ 7,363 | ||
Effective interest rate | 5.65% | ||
Convertible senior notes, fair value | $ 1,460,000 | ||
Convertible Senior Notes | 2023 Notes | Additional paid-in capital | |||
Debt Instrument | |||
Equity component | 266,900 | ||
Unamortized issuance costs | 2,800 | ||
Convertible Senior Notes | 2023 Notes | Liability | |||
Debt Instrument | |||
Unamortized issuance costs | 10,400 | ||
Convertible Senior Notes | 2025 Notes | |||
Debt Instrument | |||
Principal amount | $ 862,500 | $ 862,500 | |
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 | ||
Unamortized issuance costs | $ 5,260 | ||
Effective interest rate | 6.22% | ||
Convertible senior notes, fair value | $ 1,020,000 | ||
Convertible Senior Notes | 2025 Notes | Additional paid-in capital | |||
Debt Instrument | |||
Equity component | 237,200 | ||
Unamortized issuance costs | $ 2,500 | ||
Convertible Senior Notes | 2025 Notes | Liability | |||
Debt Instrument | |||
Unamortized issuance costs | $ 6,500 | ||
Fiscal Quarter Commencing After the Fiscal Quarter Ending On January 31, 2019 | Convertible Senior Notes | |||
Debt Instrument | |||
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 | Apr. 30, 2020 | Sep. 21, 2018 |
2023 Notes | ||
Liability component: | ||
Principal amount | $ 1,265,000 | $ 1,270,000 |
Unamortized discount | (188,675) | |
Unamortized issuance costs | (7,363) | |
Net carrying amount | 1,068,962 | |
Equity component, net of purchase discounts and issuance costs | 264,129 | |
2025 Notes | ||
Liability component: | ||
Principal amount | 862,500 | $ 862,500 |
Unamortized discount | (191,156) | |
Unamortized issuance costs | (5,260) | |
Net carrying amount | 666,084 | |
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 | |
Apr. 30, 2020 | Apr. 30, 2019 | |
Debt Instrument | ||
Amortization of debt issuance costs and purchase discounts | $ (20,416) | $ (19,005) |
Convertible Senior Notes | 2023 Notes | ||
Debt Instrument | ||
Coupon interest expense | 1,581 | 1,581 |
Amortization of debt discount (conversion option) | 12,418 | 11,595 |
Amortization of debt issuance costs and purchase discounts | 485 | 453 |
Total interest expense | 14,484 | 13,629 |
Convertible Senior Notes | 2025 Notes | ||
Debt Instrument | ||
Coupon interest expense | 2,426 | 2,426 |
Amortization of debt discount (conversion option) | 7,312 | 6,771 |
Amortization of debt issuance costs and purchase discounts | 201 | 186 |
Total interest expense | $ 9,939 | $ 9,383 |
Stock Compensation Plans (Detai
Stock Compensation Plans (Details) | 3 Months Ended |
Apr. 30, 2020shares | |
Available for Grant | |
Balances at the beginning of the period (in shares) | 19,328,502 |
Additional shares authorized (in shares) | 7,889,377 |
Options forfeited and expired (in shares) | 41,563 |
RSUs and PSUs granted (in shares) | 1,373,313 |
Shares withheld related to net share settlement of RSUs and PSUs (in shares) | 372,335 |
RSUs and PSUs forfeited and canceled (in shares) | 456,310 |
Balances at the end of the period (in shares) | 26,714,774 |
Stock Compensation Plans (Det_2
Stock Compensation Plans (Details 2) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended |
Apr. 30, 2020 | Jan. 31, 2020 | |
Shares | ||
Options forfeited and expired (in shares) | (41,563) | |
Number of Shares | ||
Restricted stock granted (in shares) | 1,373,313 | |
Shares withheld related to net share settlement of restricted stock (in shares) | 372,335 | |
Restricted stock forfeited and canceled (in shares) | (456,310) | |
Options | ||
Shares | ||
Outstanding at the beginning of the period (in shares) | 823,541 | |
Options exercised (in shares) | (174,182) | |
Options forfeited and expired (in shares) | (41,563) | |
Outstanding at the end of the period (in shares) | 607,796 | 823,541 |
Vested and expected to vest at the end of the period (in shares) | 586,862 | |
Exercisable at the end of the period (in shares) | 238,276 | |
Weighted-Average Exercise Price Per Share | ||
Balances at the beginning of the period (in dollars per share) | $ 10.79 | |
Options exercised (in dollars per share) | 8.14 | |
Options forfeited and expired (in dollars per share) | 12.69 | |
Balances at the end of the period (in dollars per share) | 11.42 | $ 10.79 |
Vested and expected to vest at the end of the period (in dollars per share) | 11.42 | |
Exercisable at the end of the period (in dollars per share) | $ 11.72 | |
Weighted-Average Remaining Contractual Term | ||
Weighted- Average Remaining Contractual Term | 6 years 5 months 12 days | 6 years 7 months 9 days |
Vested and expected to vest at the end of the period | 6 years 4 months 17 days | |
Vested and exercisable at the end of the period | 3 years 6 months 18 days | |
Aggregate Intrinsic Value | ||
Options exercised (in dollars) | $ 20,889 | |
Outstanding at the end of the period (in dollars) | 78,370 | $ 118,978 |
Vested and expected to vest at the end of the period (in dollars) | 75,672 | |
Vested and exercisable at the end of the period (in dollars) | 30,652 | |
Unrecognized compensation cost | ||
Total unrecognized compensation cost related to stock options | $ 35,400 | |
Weighted-average period over which unrecognized compensation cost is expected to be recognized | 2 years 2 months 12 days | |
RSUs | ||
Number of Shares | ||
Balances at the beginning of the period (in shares) | 13,141,650 | |
Restricted stock granted (in shares) | 1,373,313 | |
Restricted stock vested (in shares) | (1,251,916) | |
Restricted stock forfeited and canceled (in shares) | (456,310) | |
Balances at the end of the period (in shares) | 12,806,737 | 13,141,650 |
Restricted stock vested and expected to vest at the end of the period (in shares) | 11,923,564 | |
Unrecognized compensation cost | ||
Total unrecognized compensation cost | $ 1,160,000 | |
Weighted-average period over which unrecognized compensation cost is expected to be recognized | 2 years 9 months 18 days | |
Additional disclosures | ||
Weighted-average grant date fair value of awards granted (in dollars per share) | $ 129.59 | |
PSUs | ||
Number of Shares | ||
Restricted stock granted (in shares) | 318,514 | |
Unrecognized compensation cost | ||
Total unrecognized compensation cost | $ 92,200 | |
Weighted-average period over which unrecognized compensation cost is expected to be recognized | 2 years 8 months 12 days | |
Additional disclosures | ||
Weighted-average grant date fair value of awards granted (in dollars per share) | $ 136.75 | |
RSAs | ||
Number of Shares | ||
Balances at the beginning of the period (in shares) | 857,793 | |
Restricted stock vested (in shares) | (72,304) | |
Balances at the end of the period (in shares) | 785,489 | 857,793 |
Unrecognized compensation cost | ||
Total unrecognized compensation cost | $ 58,100 | |
Weighted-average period over which unrecognized compensation cost is expected to be recognized | 2 years 1 month 6 days | |
Minimum | PSUs | ||
Number of Shares | ||
Award vesting rights | 0.00% | |
Maximum | PSUs | ||
Number of Shares | ||
Award vesting rights | 200.00% | |
Additional award vesting rights | 50.00% |
Stock Compensation Plans (Det_3
Stock Compensation Plans (Details 3) - RSAs | 3 Months Ended |
Apr. 30, 2020shares | |
Stock Compensation Plans | |
Balances at the beginning of the period (in shares) | 857,793 |
RSAs vested | (72,304) |
Balances at the end of the period (in shares) | 785,489 |
Revenues, Accounts Receivable_3
Revenues, Accounts Receivable, Deferred Revenue and Remaining Performance Obligations - Disaggregated Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 30, 2020 | Apr. 30, 2019 | |
Disaggregation of Revenue | ||
Total revenues | $ 434,077 | $ 424,850 |
License | ||
Disaggregation of Revenue | ||
Total revenues | 148,385 | 202,862 |
Cloud services | ||
Disaggregation of Revenue | ||
Total revenues | 112,152 | 62,055 |
Maintenance, professional services and training | ||
Disaggregation of Revenue | ||
Total revenues | $ 173,540 | $ 159,933 |
Revenues, Accounts Receivable_4
Revenues, Accounts Receivable, Deferred Revenue and Remaining Performance Obligations - Revenue by Geography (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 30, 2020 | Apr. 30, 2019 | |
Concentration Risk | ||
Revenues | $ 434,077 | $ 424,850 |
United States | ||
Concentration Risk | ||
Revenues | 283,132 | 312,356 |
International | ||
Concentration Risk | ||
Revenues | $ 150,945 | $ 112,494 |
Revenues, Accounts Receivable_5
Revenues, Accounts Receivable, Deferred Revenue and Remaining Performance Obligations - Customer Concentration Risk (Details) - Customer concentration risk | 3 Months Ended | |
Apr. 30, 2020 | Apr. 30, 2019 | |
Revenues | Customer One | ||
Concentration Risk | ||
Concentration risk, percentage | 29.00% | 32.00% |
Revenues | Customer Two | ||
Concentration Risk | ||
Concentration risk, percentage | 14.00% | 19.00% |
Accounts receivable | Customer One | ||
Concentration Risk | ||
Concentration risk, percentage | 19.00% | 27.00% |
Accounts receivable | Customer Two | ||
Concentration Risk | ||
Concentration risk, percentage | 9.00% | 13.00% |
Revenues, Accounts Receivable_6
Revenues, Accounts Receivable, Deferred Revenue and Remaining Performance Obligations, Deferred Revenue - Deferred Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 30, 2020 | Apr. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | ||
Recognition of deferred revenue from opening deferred balance | $ 254.6 | $ 221.9 |
Revenues, Accounts Receivable_7
Revenues, Accounts Receivable, Deferred Revenue and Remaining Performance Obligations - Remaining Performance Obligations (Details) $ in Millions | Apr. 30, 2020USD ($) |
Revenue from Contract with Customer [Abstract] | |
Revenue, Remaining Performance Obligation, Amount | $ 1,720 |
Revenue, Remaining Performance Obligation, Percentage | 58.00% |
Revenues, Accounts Receivable_8
Revenues, Accounts Receivable, Deferred Revenue and Remaining Performance Obligations - Remaining Performance Obligation (Details 2) | Apr. 30, 2020 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2020-05-01 | |
Disaggregation of Revenue | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 12 months |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 30, 2020 | Apr. 30, 2019 | |
Income Tax Disclosure [Abstract] | ||
Income tax provision (benefit) | $ (1,669) | $ 3,233 |
Net Loss Per Share (Details)
Net Loss Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Apr. 30, 2020 | Apr. 30, 2019 | |
Numerator | ||
Net loss | $ (305,579) | $ (155,429) |
Denominator | ||
Weighted-average common shares outstanding (in shares) | 158,350 | 149,736 |
Less: Weighted-average unvested common shares subject to repurchase or forfeiture (in shares) | (816) | (676) |
Weighted-average shares used to compute net loss per share, basic and diluted (in shares) | 157,534 | 149,060 |
Net loss per share | ||
Net loss per share, basic and diluted (in dollars per share) | $ (1.94) | $ (1.04) |
Net Loss Per Share - Potentiall
Net Loss Per Share - Potentially Dilutive Securities (Details) - shares shares in Thousands | 3 Months Ended | |
Apr. 30, 2020 | Apr. 30, 2019 | |
Potentially dilutive securities | ||
Antidilutive securities excluded from computation of earnings per share, amount | 14,810 | 14,201 |
Shares subject to outstanding common stock options | ||
Potentially dilutive securities | ||
Antidilutive securities excluded from computation of earnings per share, amount | 608 | 353 |
Shares subject to outstanding RSUs, PSUs and RSAs | ||
Potentially dilutive securities | ||
Antidilutive securities excluded from computation of earnings per share, amount | 13,592 | 13,128 |
Employee stock purchase plan | ||
Potentially dilutive securities | ||
Antidilutive securities excluded from computation of earnings per share, amount | 610 | 720 |
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 | 3 Months Ended | |
Apr. 30, 2020 | Sep. 21, 2018 | |
Potentially dilutive securities | ||
Conversion spread of dilutive effect of convertible senior notes | 14.3 | |
Initial conversion price | $ 148.30 |