Cover
Cover - USD ($) $ in Billions | 12 Months Ended | ||
Jan. 31, 2023 | Mar. 15, 2023 | Jul. 29, 2022 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Jan. 31, 2023 | ||
Current Fiscal Year End Date | --01-31 | ||
Document Transition Report | false | ||
Entity File Number | 001-38464 | ||
Entity Registrant Name | Smartsheet Inc. | ||
Entity Incorporation, State or Country Code | WA | ||
Entity Tax Identification Number | 20-2954357 | ||
Entity Address, Address Line One | 500 108th Ave NE, Suite 200 | ||
Entity Address, City or Town | Bellevue, | ||
Entity Address, State or Province | WA | ||
Entity Address, Postal Zip Code | 98004 | ||
City Area Code | (844) | ||
Local Phone Number | 324-2360 | ||
Title of 12(b) Security | Class A common stock, no par value per share | ||
Trading Symbol | SMAR | ||
Security Exchange Name | NYSE | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 3.8 | ||
Entity Common Stock, Shares Outstanding | 132,525,556 | ||
Documents Incorporated by Reference | Certain sections of the registrant’s definitive proxy statement for its 2023 Annual Meeting of Shareholders (“Proxy Statement”), are incorporated herein by reference in Part II and Part III of this Annual Report on Form 10-K. The Proxy Statement will be filed with the Securities and Exchange Commission within 120 days of the registrant’s fiscal year ended January 31, 2023. | ||
Document Fiscal Year Focus | 2023 | ||
Amendment Flag | false | ||
Document Fiscal Period Focus | FY | ||
Entity Central Index Key | 0001366561 |
Audit Information
Audit Information | 12 Months Ended |
Jan. 31, 2023 | |
Audit Information [Abstract] | |
Auditor Firm ID | 34 |
Auditor name | Deloitte & Touche LLP |
Auditor location | Portland, Oregon |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Jan. 31, 2023 | Jan. 31, 2022 | Jan. 31, 2021 | |
Revenue | $ 766,915 | $ 550,832 | $ 385,513 |
Cost of revenue | 165,285 | 116,473 | 85,539 |
Gross profit | 601,630 | 434,359 | 299,974 |
Operating expenses | |||
Research and development | 215,205 | 165,440 | 118,722 |
Sales and marketing | 479,250 | 329,751 | 230,281 |
General and administrative | 128,811 | 109,204 | 71,443 |
Total operating expenses | 823,266 | 604,395 | 420,446 |
Loss from operations | (221,636) | (170,036) | (120,472) |
Interest income | 7,742 | 48 | 1,444 |
Other income (expense), net | 1,104 | (813) | 296 |
Loss before income tax provision (benefit) | (212,790) | (170,801) | (118,732) |
Income tax provision (benefit) | 2,849 | 296 | (3,753) |
Net loss | $ (215,639) | $ (171,097) | $ (114,979) |
Basic net loss per share (in usd per share) | $ (1.66) | $ (1.36) | $ (0.95) |
Diluted net loss per share (in dollars per share) | $ (1.66) | $ (1.36) | $ (0.95) |
Weighted average basic shares outstanding (in shares) | 130,071 | 125,632 | 120,663 |
Weighted average shares outstanding (in shares) | 130,071 | 125,632 | 120,663 |
Subscription | |||
Revenue | $ 713,735 | $ 507,375 | $ 352,782 |
Cost of revenue | 114,384 | 77,460 | 59,374 |
Professional services | |||
Revenue | 53,180 | 43,457 | 32,731 |
Cost of revenue | $ 50,901 | $ 39,013 | $ 26,165 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 31, 2023 | Jan. 31, 2022 | Jan. 31, 2021 | |
Statement of Comprehensive Income [Abstract] | |||
Net loss | $ (215,639) | $ (171,097) | $ (114,979) |
Other comprehensive income | |||
Net unrealized losses on available-for-sale securities | (169) | 0 | 0 |
Foreign currency translation adjustments | 270 | 0 | 0 |
Other comprehensive income | 101 | 0 | 0 |
Comprehensive loss | $ (215,538) | $ (171,097) | $ (114,979) |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Jan. 31, 2023 | Jan. 31, 2022 |
Current assets | ||
Cash and cash equivalents | $ 223,156 | $ 449,074 |
Short-term investments | 233,225 | 0 |
Accounts receivable, net of allowances of $6,285 and $7,561, respectively | 198,643 | 151,138 |
Prepaid expenses and other current assets | 55,063 | 34,390 |
Total current assets | 710,087 | 634,602 |
Restricted cash | 197 | 17 |
Deferred commissions | 121,785 | 91,312 |
Property and equipment, net | 39,395 | 36,835 |
Operating lease right-of-use assets | 54,278 | 67,171 |
Intangible assets, net | 39,069 | 44,096 |
Goodwill | 142,415 | 125,605 |
Other long-term assets | 2,983 | 3,194 |
Total assets | 1,110,209 | 1,002,832 |
Current liabilities | ||
Accounts payable | 2,125 | 1,506 |
Accrued compensation and related benefits | 68,347 | 66,744 |
Other accrued liabilities | 27,437 | 18,901 |
Operating lease liabilities, current | 19,220 | 18,003 |
Deferred revenue | 457,534 | 332,285 |
Total current liabilities | 574,663 | 437,439 |
Operating lease liabilities, non-current | 47,564 | 58,237 |
Deferred revenue, non-current | 2,195 | 2,377 |
Other long-term liabilities | 129 | 0 |
Total liabilities | 624,551 | 498,053 |
Commitments and contingencies (Note 14) | ||
Shareholders’ equity: | ||
Preferred stock | 0 | 0 |
Additional paid-in capital | 1,243,730 | 1,047,313 |
Accumulated other comprehensive income | 101 | 0 |
Accumulated deficit | (758,173) | (542,534) |
Total shareholders’ equity | 485,658 | 504,779 |
Total liabilities and shareholders’ equity | 1,110,209 | 1,002,832 |
Common Class A | ||
Shareholders’ equity: | ||
Common stock | 0 | 0 |
Common Class B | ||
Shareholders’ equity: | ||
Common stock | $ 0 | $ 0 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Jan. 31, 2023 | Jan. 31, 2022 |
Accounts receivable, allowances | $ 6,285 | $ 7,561 |
Preferred stock authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock issued (in shares) | 0 | 0 |
Preferred stock outstanding (in shares) | 0 | 0 |
Preferred stock | $ 0 | $ 0 |
Common Class A | ||
Common stock authorized (in shares) | 500,000,000 | 500,000,000 |
Common stock issued (in shares) | 131,845,028 | 127,809,525 |
Common stock outstanding (in shares) | 131,845,028 | 127,809,525 |
Common Class B | ||
Common stock authorized (in shares) | 500,000,000 | 500,000,000 |
Common stock issued (in shares) | 0 | 0 |
Common stock outstanding (in shares) | 0 | 0 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders’ Equity - USD ($) $ in Thousands | Total | Common Stock (Class A and B) | Additional Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Income |
Beginning balance, common stock (in shares) at Jan. 31, 2020 | 118,194,159 | ||||
Beginning balance at Jan. 31, 2020 | $ 514,060 | $ 0 | $ 770,518 | $ (256,458) | $ 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of common stock under employee stock plans (in shares) | 4,435,143 | ||||
Issuance of common stock under employee stock plans | 30,330 | 30,330 | |||
Taxes paid related to net share settlement of equity awards | (2,150) | (2,150) | |||
Issuance of restricted stock awards, net of cancellations (in shares) | 92,318 | ||||
Issuance of common stock for acquisition (in shares) | 551,282 | ||||
Issuance of common stock for acquisition | 25,872 | 25,872 | |||
Share-based compensation expense | 73,796 | 73,796 | |||
Comprehensive income | 0 | ||||
Comprehensive loss | (114,979) | (114,979) | |||
Net loss | (114,979) | (114,979) | |||
Ending balance, common stock (in shares) at Jan. 31, 2021 | 123,272,902 | ||||
Ending balance at Jan. 31, 2021 | 526,929 | $ 0 | 898,366 | (371,437) | 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of common stock under employee stock plans (in shares) | 4,536,623 | ||||
Issuance of common stock under employee stock plans | 38,248 | 38,248 | |||
Taxes paid related to net share settlement of equity awards | (6,171) | (6,171) | |||
Share-based compensation expense | 116,870 | 116,870 | |||
Comprehensive income | 0 | ||||
Comprehensive loss | (171,097) | (171,097) | |||
Net loss | (171,097) | (171,097) | |||
Ending balance, common stock (in shares) at Jan. 31, 2022 | 127,809,525 | ||||
Ending balance at Jan. 31, 2022 | 504,779 | $ 0 | 1,047,313 | (542,534) | 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of common stock under employee stock plans (in shares) | 4,035,503 | ||||
Issuance of common stock under employee stock plans | 20,577 | 20,577 | |||
Taxes paid related to net share settlement of equity awards | (4,177) | (4,177) | |||
Share-based compensation expense | 180,017 | 180,017 | |||
Comprehensive income | 101 | 101 | |||
Comprehensive loss | (215,538) | ||||
Net loss | (215,639) | (215,639) | |||
Ending balance, common stock (in shares) at Jan. 31, 2023 | 131,845,028 | ||||
Ending balance at Jan. 31, 2023 | $ 485,658 | $ 0 | $ 1,243,730 | $ (758,173) | $ 101 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 31, 2023 | Jan. 31, 2022 | Jan. 31, 2021 | |
Cash flows from operating activities | |||
Net loss | $ (215,639) | $ (171,097) | $ (114,979) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | |||
Share-based compensation expense | 176,555 | 114,900 | 71,750 |
Depreciation and amortization | 24,856 | 21,765 | 17,255 |
Net amortization of premiums (discounts) on investments | (2,768) | 0 | 0 |
Amortization of deferred commission costs | 47,093 | 43,680 | 30,691 |
Unrealized foreign currency (gain) loss | (1,198) | 1,048 | (161) |
Loss on disposal of assets | 779 | 0 | 268 |
Non-cash operating lease costs | 18,914 | 14,905 | 11,924 |
Impairment of long-lived assets | 1,544 | 0 | 0 |
Other, net | (1,208) | 0 | 0 |
Changes in operating assets and liabilities: | |||
Accounts receivable | (47,597) | (48,575) | (43,112) |
Prepaid expenses and other current assets | (21,437) | (19,884) | (3,678) |
Other long-term assets | (590) | 467 | (5,819) |
Accounts payable | 154 | (1,331) | (4,915) |
Other accrued liabilities | 8,432 | 1,950 | 5,543 |
Accrued compensation and related benefits | 3,739 | 19,906 | 5,811 |
Deferred commissions | (77,566) | (74,463) | (42,965) |
Deferred revenue | 123,853 | 110,664 | 60,534 |
Other long-term liabilities | 89 | (3,904) | 3,904 |
Operating lease liabilities | (14,417) | (13,543) | (7,699) |
Net cash provided by (used in) operating activities | 23,588 | (3,512) | (15,648) |
Cash flows from investing activities | |||
Purchases of short-term investments | (456,649) | 0 | 0 |
Maturities of short-term investments | 226,048 | 0 | 0 |
Proceeds from early termination of short-term investments | 0 | 0 | 50,532 |
Purchases of long-term investments | 0 | (1,000) | 0 |
Purchases of property and equipment | (6,137) | (10,563) | (4,176) |
Proceeds from sale of property and equipment | 217 | 0 | 1,250 |
Proceeds from liquidation of a long-term investment | 622 | 0 | 0 |
Capitalized internal-use software development costs | (7,660) | (6,706) | (7,608) |
Purchases of intangible assets | 0 | (31) | 0 |
Payments for business acquisitions, net of cash and restricted cash acquired | (20,342) | 0 | (125,055) |
Net cash used in investing activities | (263,901) | (18,300) | (85,057) |
Cash flows from financing activities | |||
Payments on principal of finance leases | 0 | 0 | (4,129) |
Payments of deferred offering costs | 0 | 0 | (59) |
Proceeds from exercise of stock options | 5,633 | 19,132 | 17,373 |
Taxes paid related to net share settlement of restricted stock units | (4,177) | (6,171) | (2,150) |
Proceeds from contributions to Employee Stock Purchase Plan | 12,600 | 17,380 | 14,758 |
Net cash provided by financing activities | 14,056 | 30,341 | 25,793 |
Effects of changes in foreign currency exchange rates on cash, cash equivalents, and restricted cash | 334 | (1,197) | 471 |
Net increase (decrease) in cash, cash equivalents, and restricted cash | (225,923) | 7,332 | (74,441) |
Cash, cash equivalents, and restricted cash at beginning of period | 449,680 | 442,348 | 516,789 |
Cash, cash equivalents, and restricted cash at end of period | 223,757 | 449,680 | 442,348 |
Supplemental disclosures | |||
Cash paid for interest | 0 | 0 | 114 |
Cash paid for income tax | 551 | 196 | 168 |
Right-of-use assets obtained in exchange for new operating lease liabilities | 7,230 | 994 | 35,415 |
Right-of-use assets reductions related to operating leases | 4,696 | 0 | 0 |
Accrued purchases of property and equipment, including internal-use software | 1,271 | 1,164 | 1,080 |
Share-based compensation capitalized in internal-use software development costs | 3,359 | 1,970 | 1,986 |
Fair value of shares issued as consideration for acquisition | $ 0 | $ 0 | $ 25,872 |
Overview and Basis of Presentat
Overview and Basis of Presentation | 12 Months Ended |
Jan. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Overview and Basis of Presentation | Overview and Basis of Presentation Description of business Smartsheet Inc. (the “Company,” “we,” “our”) was incorporated in the State of Washington in 2005, and is headquartered in Bellevue, Washington. The Company is the enterprise platform for modern work management, enabling teams and organizations of all sizes to plan, capture, manage, automate, and report on work at scale, resulting in more efficient processes and better business outcomes. Customers access their accounts via a web-based interface or a mobile application. Some customers also purchase the Company’s professional services, which primarily consist of consulting and training services. Basis of presentation The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in th e United States of America (“GAAP”), and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding financial reporting. The Company’s fiscal year ends on January 31. The consolidated financial statements include the results of Smartsheet Inc. and its wholly owned subsidiaries, including those located in the United States, the United Kingdom, Germany, Australia, Japan, and Costa Rica. All intercompany balances and transactions have been eliminated upon consolidation. In the opinion of management, the information contained herein reflects all adjustments necessary for a fair presentation of our consolidated financial statements. All such adjustments are of a normal, recurring nature. Use of estimates The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates, judgments, and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenue and expenses during the reporting periods. The Company bases its estimates on historical experience and on other assumptions that its management believes are reasonable under the circumstances. Actual results could differ from those estimates. The Company’s most significant estimates and judgments involve the measurement of fair values of share-based compensation award grants; determination of the amortization period for capitalized sales commission costs; and revenue recognition with respect to the allocation of transaction consideration for the Company’s offerings , among others. The Company completed an assessment of the amortization period for deferred sales commission costs and determined that it should increase the period over which we amortize deferred commissions from three years to four years. This change in accounting estimate was effective August 1, 2022 and is being accounted for prospectively in the consolidated financial statements. For the year ended January 31, 2023, the change in amortization period resulted in a benefit to both sales and marketing expense and net loss of approximately 2% of total revenue or $0.09 per basic and diluted share. The effect of this change in estimate is based on the carrying value of deferred commissions included in the Company’s consolidated balance sheets as of July 31, 2022 and those deferred during the six months ended January 31, 2023. Liquidity The Company continues to be subject to the risks and challenges associated with companies at a similar stage of development, including the ability to raise additional capital to support future growth. Since inception through January 31, 2023, the Company has incurred losses from operations and accumulated a deficit of $758.2 million. The Company finances its operations primarily through payments received from customers for subscriptions and professional services, net proceeds received through sales of equity securities, option exercises, and contributions from our 2018 Employee Stock Purchase Plan (“ESPP”). The Company believes its existing cash will be sufficient to meet its working capital and capital expenditure needs for at least the next 12 months. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Jan. 31, 2023 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Segment information The Company operates as one operating segment. The Company’s chief operating decision maker is its Chief Executive Officer, who reviews consolidated financial information for purposes of making operating decisions, assessing financial performance, and allocating resources. Revenue recognition The Company derives its revenue primarily from subscription services and professional services. Revenue is recognized when control of these services is transferred to the Company ’ s customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those services, net of any sales taxes. The Company determines revenue recognition through the following steps: • identification of the contract, or contracts, with a customer; • identification of the performance obligations in the contract; • determination of the transaction price; • allocation of the transaction price to the performance obligations in the contract; and • recognition of revenue when, or as, the Company satisfies a performance obligation. Subscription revenue Subscription revenue primarily consists of fees from customers for access to the Company’s cloud-based platform and involves a significant volume of transactions. The Company uses automated systems to process and record these transactions. S ubscription revenue is recognized on a ratable basis over the subscription contract term, beginning on the date the access to the Company ’ s platform is provided, as no implementation work is required, if consideration the Company is entitled to receive is probable of collection. Subscription contracts generally have terms of one year or one month, are billed in advance, and are non-cancelable. The subscription arrangements do not allow the customer the contractual right to take possession of the platform; as such, the arrangements are considered to be service contracts. Certain of the Company ’ s subscription contracts contain performance guarantees related to service continuity. To date, refunds related to such guarantees have been immaterial in all periods presented. On occasion, the Company sells its subscriptions to third-party resellers. The price at which the Company sells to the reseller is typically discounted, as compared to the price at which the Company would sell to an end customer, in order to enable the reseller to realize a margin on the eventual sale to the end customer. As our pricing to the reseller is fixed, and the Company does not have visibility into the pricing provided by the reseller to the end customer, the revenue is recorded net of any reseller margin. Professional services revenue Professional services revenue primarily includes revenue recognized from fees for consulting and training services. The Company’s consulting services consist of platform configuration and use case optimization, and are primarily invoiced on a time and materials basis, monthly in arrears. Services revenue is recognized over time, as service hours are delivered. Smaller consulting engagements are, on occasion, provided for a fixed fee. These smaller consulting arrangements are typically of short duration (less than three months). In these cases, revenue is recognized over time, based on the proportion of hours of work performed, compared to the total hours expected to complete the engagement. Configuration and use case optimization services do not result in significant customization or modification of the software platform or user interface. Training services are billed in advance, on a fixed-fee basis, and revenue is recognized after the training program is delivered, or after the customer’s right to receive training services expires. Associated out-of-pocket travel expenses related to the delivery of professional services are typically reimbursed by the customer. Out-of-pocket expense reimbursements are recognized as revenue at the point in time, or as the distinct performance obligation to which they relate is delivered. Out-of-pocket expenses are recognized as cost of professional services as incurred. Contracts with multiple performance obligations Some of the Company’s contracts with customers contain multiple performance obligations. The Company accounts for individual performance obligations separately, as they have been determined to be distinct, i.e., the services are separately identifiable from other items in the arrangement and the customer can benefit from them on their own or with other resources that are readily available to the customer. The transaction price is allocated to the distinct performance obligations on a relative stand-alone selling price basis. Stand-alone selling prices are determined based on the prices at which the Company separately sells subscription, consulting, and training services, and based on t he Company’s overall pricing objectives, taking into consideration market conditions, value of t he Company’s contracts, the types of offerings sold, customer demographics, and other factors. Accounts receivable and allowance for doubtful accounts Accounts receivable are primarily comprised of trade receivables that are recorded at the invoice amount, net of an allowance for doubtful accounts. Subscription fees billed in advance of the related subscription term represent contract liabilities and are presented as accounts receivable and deferred revenues upon establishment of the unconditional right to invoice, typically upon signing of the non-cancelable service agreement. Our typical payment terms provide for customer payment within 30 days of the invoice date. The allowance for doubtful accounts is based on the Company’s estimated expected credit losses derived upon assessment of various factors including historical trends on collectibility, composition of accounts receivable by aging, current market conditions, reasonable and supportable forecasts of future economic conditions, and other factors. The estimated credit losses are recorded to the allowance for doubtful accounts in the consolidated balance sheets, with an offsetting decrease in related deferred revenue and a reduction of revenue or charge to general and administrative expense in the consolidated statements of operations. Activity related to the Company’s allowance for doubtful accounts was as follows (in thousands): January 31, 2023 2022 2021 Beginning balance $ 7,561 $ 6,933 $ 2,989 Additions 5,440 7,700 6,540 Write-offs (6,716) (7,072) (2,596) Ending balance $ 6,285 $ 7,561 $ 6,933 Deferred revenue Deferred revenue consists of customer billings and payments in advance of revenue being recognized from the Company’s contracts. The Company typically invoices its customers annually in advance for its subscription-based contracts. Deferred revenue and accounts receivable are recorded at the beginning of a new subscription term. For some customers, the Company invoices in monthly, quarterly, semi-annual, or multi-year installments and, therefore, the deferred revenue balance does not necessarily represent the total contract value of all non-cancelable subscription agreements. Deferred revenue anticipated to be recognized during the succeeding 12-month period is recorded as deferred revenue and the remaining portion is recorded as deferred revenue, non-current in our consolidated balance sheets. Deferred commissions The majority of sales commissions earned by the Company ’s sales force are considered incremental and recoverable costs of obtaining a contract with a customer. Sales commissions are paid on initial contracts and on any upsell contracts with a customer. No sales commissions are paid on customer renewals. Sales commissions and related payroll taxes and incremental fringe benefits are deferred and then amortized on a straight-line basis over a period of benefit that the Company has determined to be four years. The Company determined the period of benefit by taking into consideration its customer contracts, expected customer life, the expected life of its technology, and other factors. Amortization expense is included in sales and marketing expense in the consolidated statements of operations. The Company evaluates the period of benefit and tests for impairment on a quarterly basis and whenever events or changes in circumstances occur that could impact the recoverability of these assets. Overhead allocations The Company allocates shared costs, such as facilities (including lease costs, utilities, and depreciation on equipment shared by all departments) and information technology, to all departments based on headcount. As such, allocated shared costs are reflected in each cost of revenue and operating expense category in the consolidated statements of operations. Cash, cash equivalents The Company considers all highly liquid investments with an original maturity of three months or less from date of purchase to be cash equivalents. Cash and cash equivalents are recorded at cost, which approximates fair value. Interest earned on cash and cash equivalents is recorded in interest income in the consolidated statements of operations. Restricted cash Restricted cash, which primarily relates to Australian employee contributions to our ESPP, was $0.6 million, $0.6 million, and $0.1 million as of January 31, 2023, 2022, and 2021, respectively. Cash as reported on the consolidated statements of cash flows includes the aggregate amounts of cash and cash equivalents and restricted cash as shown on the consolidated balance sheets. Cash as reported on the consolidated statements of cash flows consists of the following (in thousands): January 31, 2023 2022 2021 Cash and cash equivalents $ 223,156 $ 449,074 $ 442,200 Restricted cash included in prepaid expenses and other current assets 404 589 130 Restricted cash 197 17 18 Total cash, cash equivalents, and restricted cash shown in the consolidated statements of cash flows $ 223,757 $ 449,680 $ 442,348 Short-term investments The Company’s short-term investments primarily consist of U.S. Treasury securities, corporate bonds, commercial paper, and agency securities that have original maturities greater than three months at the time of purchase. These investments are classified as available-for-sale securities and we reevaluate such classification as of each balance sheet date. The Company considers all investments as available for use in current operations, including those with maturity dates beyond one year, and therefore classifies these securities as current assets in its consolidated balance sheets. Available-for-sale securities are recorded at fair value each reporting period. For unrealized losses in securities that the Company intends to hold and will not be more likely than not required to sell before recovery, the Company further evaluates whether declines in fair value below amortized cost are due to credit or non-credit related factors. The Company considers credit related impairments to be changes in value that are driven by a change in the creditor’s ability to meet its payment obligations, and records an allowance and recognizes a corresponding loss in other income (expense), net in the consolidated statements of operations when the impairment is incurred. Unrealized non-credit related losses and unrealized gains are reported as a separate component of accumulated other comprehensive loss in the consolidated balance sheets until realized. Realized gains and losses are determined based on the specific identification method and are reported in other income (expense), net in the consolidated statements of operations. Business combinations When we acquire a business, the purchase price is allocated to the assets acquired and liabilities assumed based on their estimated fair values as of the acquisition date. Any residual purchase price is recorded as goodwill. The allocation of the purchase price requires management to make significant estimates in determining the fair values of the assets acquired and liabilities assumed, especially with respect to the identifiable intangible assets. These estimates can include, but are not limited to, the cash flows that an asset is expected to generate in the future, the appropriate weighted-average cost of capital, the cost savings expected to be derived from acquiring an asset, its expected remaining economic useful life, and the appropriate discount rate to employ in the valuation analyses in order to properly account for the risk associated with the asset’s expected future cash flows. These estimates are inherently uncertain. During the measurement period, which may be up to one year from the acquisition date, adjustments to the fair value of these tangible and intangible assets acquired and liabilities assumed may be recorded, with the corresponding offset to goodwill. Upon the conclusion of the measurement period or final determination of the fair value of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded to our consolidated statements of operations and consolidated statements of comprehensive loss. Acquisition costs, such as legal and consulting fees, are expensed as incurred. Goodwill and acquired intangible assets The Company evaluates goodwill for impairment at the reporting unit level on an annual basis (September 1), or whenever events or changes in circumstances indicate that impairment may exist. Events or changes in circumstances which could trigger an impairment review include, but are not limited to, a significant adverse change in customer demand or business climate or a significant decrease in expected cash flows. When evaluating goodwill for impairment, the Company may first perform a qualitative assessment to determine whether it is more likely than not that a reporting unit is impaired. If the Company does not perform a qualitative assessment, or if the Company determines that it is not more likely than not that the fair value of the reporting unit exceeds its carrying amount, the Company calculates the estimated fair value of the reporting unit. If the carrying amount of the reporting unit exceeds the estimated fair value, an impairment charge is recorded to reduce the carrying value to the estimated fair value. No impairment charges were recorded for the years ended January 31, 2023, 2022, or 2021. Acquired intangible assets consist of identifiable intangible assets, primarily software technology and customer relationships, resulting from our acquisitions. Intangible assets are recorded at fair value on the date of acquisition and amortized over their estimated useful lives. Property and equipment Property and equipment are recorded at cost, net of accumulated depreciation and amortization. Depreciation is computed using the straight-line method over the following estimated useful lives: Computer equipment 3 years Computer software 3 years Furniture and fixtures 5-7 years Leasehold improvements are amortized over the shorter of the expected useful lives of the assets or the related lease term. Maintenance and repairs that do not improve or extend the lives of the respective assets are expensed as incurred. Internal-use software development costs The Company capitalizes certain qualifying costs incurred during the application development stage in connection with the development of internal-use software. Costs related to preliminary project activities and post-implementation activities are expensed in research and development (“R&D”) as incurred. R&D expenses consist primarily of employee-related costs, software-related costs, allocated overhead, and costs of outside services used to supplement our internal staff. Internal-use software costs of $11.0 million and $8.6 million were capitalized in the years ended January 31, 2023 and 2022, respectively. All capitalized costs related to costs incurred during the application development stage of software development for the Company’s platform to which subscriptions are sold. Capitalized internal-use software costs are included within property and equipment, net on the consolidated balance sheets, and are amortized over the estimated useful life of the software, which is typically three years. The related amortization expense is recognized in the consolidated statements of operations within the function that receives the benefit of the developed software. Amortization expense of capitalized internal-use software costs totaled $7.7 million, $5.7 million, and $3.6 million for the years ended January 31, 2023, 2022, and 2021, respectively. Leases The Company determines if an arrangement is a lease at inception, and leases are classified at commencement as either operating or finance leases. All of the Company’s existing leases are classified as operating leases. Right-of-use (“ROU”) assets and lease liabilities are recognized at commencement date based on the present value of the future minimum lease payments over the lease term. ROU assets also include any lease payments made. As our operating leases do not provide an implicit rate, we estimate our incremental borrowing rate based on information available at the commencement date in determining the present value of future payments. This rate is an estimate of the collateralized borrowing rate the Company would incur on its future lease payments over a similar term based on the information available at commencement date. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. At January 31, 2023, we did not include any options to extend leases in our lease terms as we were not reasonably certain to exercise them. The Company’s lease agreements do not contain residual value guarantees or covenants. The Company utilizes certain practical expedients and policy elections available under the lease accounting standard. Leases with a term of one year or less are not recognized on our consolidated balance sheets; we recognize lease expense for these leases on a straight-line basis over the lease term. Additionally, we have elected to include non-lease components with lease components for the purpose of calculating lease ROU assets and liabilities, to the extent that they are fixed. Non-lease components that are not fixed are expensed as incurred as variable lease payments. Our operating leases typically include non-lease components such as common-area maintenance costs. The Company accounts for subleases from the perspective of a lessor. The Company has two subleases, which are both classified as operating leases. The Company records sublease income as a reduction of lease expense using the straight-line method over the term of the sublease. Impairment of long-lived assets Long-lived assets, such as property and equipment, intangible assets, operating lease ROU assets, and internal-use software development costs, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset group may not be recoverable. Recoverability of an asset group is measured by comparing the carrying amount to the estimated undiscounted future cash flows expected to be generated. When the carrying amount exceeds the undiscounted cash flows, the assets are adjusted to their estimated fair value and an impairment charge is recognized as the amount by which the carrying amount exceeds its fair value. We recorded an impairment charge of $1.5 million during the year ended January 31, 2023 , related to the ROU assets and underlying property and equipment associated with our subleased office spaces as described further in Note 13, Leases , to the consolidated financial statements. Self-funded health insurance The Company’s health insurance plan is partially self-funded. To reduce its risk related to high-dollar claims, the Company maintains individual and aggregate stop-loss insurance. The Company estimates its exposure for claims incurred but not yet paid at the end of each reporting period and uses historical claims data to estimate its self-insurance liability. As of January 31, 2023 and 2022 , the Company’s net self-insurance reserve estimate was $2.3 million which was included in other accrued liabilities in the accompanying consolidated balance sheets. Advertising expenses Advertising and marketing costs are expensed as incurred, and are included in sales and marketing expense in the consolidated statements of operations. Advertising and marketing expenses, inclusive of lead generation costs, we re $77.9 million, $55.6 million, and $31.6 million for the years ended January 31, 2023, 2022, and 2021, respec tively. Share-based compensation The Company measures and recognizes compensation expense for all share-based awards granted to employees and directors, based on the estimated fair value of the award on the date of grant. We use the Black-Scholes option pricing model to measure the fair value of stock option awards and shares granted under our ESPP. The fair value of restricted stock units (“RSUs”) is measured using the closing market price of the Company’s common stock on the date of the grant. The Company uses the Monte Carlo simulation technique to calculate the fair value of market-based awards, which include our performance share units (“PSUs”). For awards that vest solely based on continued service, the fair value of an award is recognized as an expense over the requisite service period on a straight-line basis. For awards that contain market-conditions, we recognize share-based compensation expense over the requisite service period using the graded-vesting method. The Company recognizes share-based compensation expense related to shares issued pursuant to our ESPP on a straight-line basis over the offering period. We recognize share-based compensation expense based on estimated forfeitures. Share-based compensation expense is included in cost of revenue and operating expenses within our consolidated statements of operations based on the department of the individual earning the award. The Company makes several estimates in determining share-based compensation and these estimates generally require significant analysis and judgment to develop. Income taxes Income taxes are accounted for using the asset and liability method. Under this method, the Company recognizes deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts and the tax basis of assets and liabilities. Deferred tax assets and liabilities are measured using the enacted tax rates expected to apply to taxable income in the years in which the temporary differences are expected to be recovered or settled. The Company records a valuation allowance to reduce deferred tax assets to an amount for which realization is more likely than not. The Company evaluates and accounts for uncertain tax positions using a two-step approach. The first step is to evaluate if the weight of available evidence indicates that it is more likely than not that the tax position will be sustained in an audit. The second step is to measure the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement. The Company reflects interest and penalties related to income tax liabilities as a component of income tax expense. Concentrations of risk and significant customers Financial instruments that potentially subject the Company to concentrations of credit risk are primarily cash, cash equivalents, short-term investments, and accounts receivable. The Company maintains its cash accounts with financial institutions where deposits, at times, exceed the Federal Deposit Insurance Corporation (“FDIC”) limits. No individual customer represented more than 10% of accounts receivable as of January 31, 2023 or 2022. No individual customer represented more than 10% of revenue for the years ended January 31, 2023, 2022, or 2021. Net loss per share The Company calculates basic net loss per share by dividing net loss by the weighted-average number of the Company’s common stock shares outstanding during the respective period. For periods where we report net income, the Company will use the treasury stock method to calculate diluted net income per share by adjusting basic net income per share for the potential dilutive impacts of outstanding stock options, RSUs, PSUs, and shares issuable pursuant to our ESPP. Since we have reported a net loss for all periods presented, all potentially dilutive shares are antidilutive and therefore no adjustment to the denominator is made. Diluted net loss per share and basic net loss per share are the same number for all periods presented. Foreign currency translation The functional currency of the Company’s foreign operations is primarily the U.S. dollar, while a few of our wholly owned subsidiaries use their respective local currency as their functional currency. We present our consolidated financial statements in U.S. dollar. For subsidiaries where the functional currency is a foreign currency, the Company translates the foreign currency financial statements to U.S. dollar using the exchange rates at the balance sheet date for assets and liabilities, the period average exchange rates for revenues and expenses, and the historical exchange rates for equity. The effects of foreign currency translation adjustments are recorded in accumulated other comprehensive income as a component of shareholders’ equity in the consolidated balance sheets and the related periodic movements are presented in the consolidated statements of comprehensive loss. Foreign currency transaction gains and losses are included in other income (expense), net, in the consolidated statements of operations for the period. Recently adopted accounting pronouncements In October 2021, the Financial Accounting Standards Board issued Accounting Standards Update 2021-08, Business Combinations- Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (Topic 805) . The new guidance requires contract assets and contract liabilities acquired in a business combination to be recognized in accordance with Accounting Standards Codification (“ASC”) Topic 606 as if the acquirer had originated the contracts. The standard is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Early adoption was permitted. The Company adopted this standard effective August 1, 2022. The adoption of this standard did not have a material effect on the Company’s consolidated financial statements. |
Revenue from Contracts with Cus
Revenue from Contracts with Customers | 12 Months Ended |
Jan. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contracts with Customers | Revenue from Contracts with CustomersDuring the years ended January 31, 2023, 2022, and 2021 the Company recognized $328.1 million, $216.6 million, and $155.2 million of subscription revenue, respectively, and $4.7 million, $4.8 million, and $3.4 million of professional services revenue, respectively, which were included in the deferred revenue balance as of January 31, 2022, 2021, and 2020, respectively. As of January 31, 2023, approximately $528.9 million of revenue, including amounts already invoiced and amounts contracted but not yet invoiced, was expected to be recognized from remaining performance obligations, of which $520.5 million related to subscription services and $8.4 million related to professional services. Approximately 92% of revenue related to remaining performance obligations is expected to be recognized in the next 12 months.Deferred Commissions Deferred commissions were $121.8 million and $91.3 million as of January 31, 2023 and 2022, respectively. Amortization expense for deferred commissions was $47.1 million, $43.7 million, and $30.7 million for the years ended January 31, 2023, 2022, and 2021, respectively. Prior to August 1, 2022, deferred commissions were amortized over a period of three years. Effective as of August 1, 2022, deferred commissions are amortized over a period of four years. The amortization expense is recorded in sales and marketing on the Company’s consolidated statements of operations. No significant impairments of commissions assets were recorded during the years ended January 31, 2023, 2022, or 2021 . |
Deferred Commissions
Deferred Commissions | 12 Months Ended |
Jan. 31, 2023 | |
Revenue Recognition and Deferred Revenue [Abstract] | |
Deferred Commissions | Revenue from Contracts with CustomersDuring the years ended January 31, 2023, 2022, and 2021 the Company recognized $328.1 million, $216.6 million, and $155.2 million of subscription revenue, respectively, and $4.7 million, $4.8 million, and $3.4 million of professional services revenue, respectively, which were included in the deferred revenue balance as of January 31, 2022, 2021, and 2020, respectively. As of January 31, 2023, approximately $528.9 million of revenue, including amounts already invoiced and amounts contracted but not yet invoiced, was expected to be recognized from remaining performance obligations, of which $520.5 million related to subscription services and $8.4 million related to professional services. Approximately 92% of revenue related to remaining performance obligations is expected to be recognized in the next 12 months.Deferred Commissions Deferred commissions were $121.8 million and $91.3 million as of January 31, 2023 and 2022, respectively. Amortization expense for deferred commissions was $47.1 million, $43.7 million, and $30.7 million for the years ended January 31, 2023, 2022, and 2021, respectively. Prior to August 1, 2022, deferred commissions were amortized over a period of three years. Effective as of August 1, 2022, deferred commissions are amortized over a period of four years. The amortization expense is recorded in sales and marketing on the Company’s consolidated statements of operations. No significant impairments of commissions assets were recorded during the years ended January 31, 2023, 2022, or 2021 . |
Net Loss Per Share
Net Loss Per Share | 12 Months Ended |
Jan. 31, 2023 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | Net Loss Per Share The following table presents calculations for basic and diluted net loss per share (in thousands, except per share data): Year Ended January 31, 2023 2022 2021 Numerator: Net loss $ (215,639) $ (171,097) $ (114,979) Denominator: Weighted-average shares outstanding 130,071 125,632 120,663 Net loss per share, basic and diluted $ (1.66) $ (1.36) $ (0.95) The following outstanding shares of common stock equivalents as of the periods presented were excluded from the computation of diluted net loss per share for the periods presented because the impact of including them would have been anti-dilutive (in thousands): Year Ended January 31, 2023 2022 2021 Shares subject to outstanding common stock awards 15,045 11,855 11,299 Shares issuable pursuant to the 2018 Employee Stock Purchase Plan 386 52 162 Total potentially dilutive shares 15,431 11,907 11,461 |
Investments
Investments | 12 Months Ended |
Jan. 31, 2023 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments | Investments All cash equivalents and short-term investments were designated as available-for-sale securities as of January 31, 2023. The following table presents the amortized costs, unrealized gains and losses, and estimated fair values of the Company’s cash equivalents and short-term investments as of January 31, 2023 (in thousands): January 31, 2023 Description Amortized Cost* Unrealized Gains Unrealized Losses Estimated Fair Value Cash equivalents: Money market funds $ 137,490 $ — $ — $ 137,490 Agency securities 3,497 — — 3,497 Total cash equivalents 140,987 — — 140,987 Short-term investments: Corporate bonds 66,051 46 (79) 66,018 U.S. Treasury securities 62,520 2 (144) 62,378 Commercial paper 78,454 — — 78,454 Agency securities 26,369 12 (6) 26,375 Total short-term investments 233,394 60 (229) 233,225 Total $ 374,381 $ 60 $ (229) $ 374,212 *Excludes interest receivable of $1.1 million, which is included in Prepaid expenses and other current assets The Company does not intend to sell, nor is it more likely than not that we will be required to sell, any investments in unrealized loss positions before recovery of their amortized cost basis. We did not recognize any credit losses related to our investments during the year ended January 31, 2023. The unrealized losses on our short-term investments were primarily due to unfavorable changes in interest rates subsequent to initial purchase. None of the short-term investments held as of January 31, 2023 were in a continuous unrealized loss position for greater than 12 months. There were no material realized gains or losses from available for sale securities that were reclassified out of accumulated other comprehensive income during the year ended January 31, 2023. The following table presents the contractual maturities of the Company’s short-term investments as of January 31, 2023 (in thousands): January 31, 2023 Amortized Cost Estimated Fair Value Due within one year $ 207,487 $ 207,325 Due between one to five years 25,907 25,900 Total $ 233,394 $ 233,225 |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Jan. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Assets and liabilities recorded at fair value in the consolidated financial statements are categorized based upon the level of judgment associated with the inputs used to measure their fair value. The lowest level of significant input determines the placement of the fair value measurement within the following hierarchical levels: • Level 1: Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. • 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. Assets and liabilities measured at fair value on a recurring basis The following tables present information about the Company’s financial assets and liabilities that are measured at fair value and indicates the fair value hierarchy of the valuation inputs used (in thousands): January 31, 2023 Level 1 Level 2 Level 3 Total Assets Cash equivalents: Money market funds $ 137,490 $ — $ — $ 137,490 Agency securities 3,497 3,497 Total cash equivalents 137,490 3,497 — 140,987 Short-term investments: Corporate bonds — 66,018 — 66,018 U.S. Treasury securities — 62,378 — 62,378 Commercial paper — 78,454 — 78,454 Agency securities — 26,375 — 26,375 Total short-term investments — 233,225 — 233,225 Total assets $ 137,490 $ 236,722 $ — $ 374,212 January 31, 2022 Level 1 Level 2 Level 3 Total Assets Cash equivalents: Money market funds $ 378,294 $ — $ — $ 378,294 Total assets $ 378,294 $ — $ — $ 378,294 The carrying amounts of certain financial instruments, including cash held in banks, accounts receivable, and accounts payable, approximate fair value due to their short-term maturities and are excluded from the fair value tables above. It is the Company’s policy to recognize transfers of assets and liabilities between levels of the fair value hierarchy at the end of a reporting period. The Company does not transfer out of Level 3 and into Level 2 until observable inputs become available and reliable. There were no transfers between fair value measurement levels during the years ended January 31, 2023 or 2022. Assets and liabilities measured at fair value on a non-recurring basis See Note 9, Business Combinations, and Note 10, Goodwill and Net Intangible Assets , of these notes to our consolidated financial statements for fair value measurements of certain assets and liabilities recorded at fair value on a non-recurring basis. The Company’s long-lived assets are measured at fair value on a non-recurring basis and are reduced if the assets are determined to be impaired. The fair value of the operating lease ROU assets and associated property and equipment was estimated as of the sublease execution date using an income approach by converting future sublease cash inflows and outflows to a single present value. Estimated cash flows were discounted at a rate commensurate with the inherent risks associated with the asset group to arrive at an estimate of fair value. See Note 13, Leases, |
Property and Equipment, Net
Property and Equipment, Net | 12 Months Ended |
Jan. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, Net | Property and Equipment, Net Property and equipment, net consists of the following (in thousands): January 31, 2023 2022 Computer equipment $ 12,954 $ 13,728 Computer software, purchased and developed 33,260 27,663 Furniture and fixtures 6,526 9,082 Leasehold improvements 9,612 9,969 Total property and equipment 62,352 60,442 Less: accumulated depreciation (22,957) (23,607) Total property and equipment, net $ 39,395 $ 36,835 Depreciation expense was $13.7 million, $10.9 million, and $11.0 million for the years ended January 31, 2023, 2022, and 2021, respectively. |
Business Combinations
Business Combinations | 12 Months Ended |
Jan. 31, 2023 | |
Business Combinations [Abstract] | |
Business Combinations | Business Combinations Outfit On September 1, 2022, the Company acquired 100% of the outstanding equity of On Brand Holdings, Inc. and its subsidiaries, collectively doing business as Outfit, pursuant to an Agreement and Plan of Merger. The Company acquired Outfit to enhance Brandfolder’s templating and creative automation solution. We incurred acquisition costs of $0.6 million during the year ended January 31, 2023. The total purchase consideration for the acquisition of Outfit was $20.6 million in cash, net of customary purchase price adjustments. The transaction was accounted for as a business combination and accordingly, the total fair value of purchase consideration was allocated to the tangible and intangible assets acquired and liabilities assumed based on their respective estimated fair values on the acquisition date. Fair values were determined using income and cost approaches. The fair value measurements of the intangible assets were based primarily on significant unobservable inputs and thus represent a Level 3 measurement. The following table summarizes the preliminary fair values of assets acquired and liabilities assumed as of the date of acquisition (in thousands): September 1, 2022 Cash and restricted cash $ 266 Intangible assets 5,190 Goodwill 16,434 Other net tangible assets and liabilities assumed (1,283) Total $ 20,607 The excess purchase price consideration was recorded as goodwill, and is primarily attributable to the acquired assembled workforce and expected synergies with Brandfolder’s product offerings. The goodwill is not deductible for income tax purposes. The purchase price allocation was prepared on a preliminary basis and may be subject to further adjustments as additional information becomes available concerning the fair value of the assets acquired and liabilities assumed. The primary areas that remain preliminary as of January 31, 2023 relate to the fair values of intangible assets acquired, certain tangible assets and liabilities acquired, income taxes, and goodwill. The Company expects to finalize the fair value measurements as soon as practicable, but not later than one year from the acquisition date. We engaged a third-party valuation specialist to aid our analysis of the fair value of the acquired intangibles. All estimates, key assumptions, and forecasts were either provided by or reviewed by us. While we chose to utilize a third-party valuation specialist for assistance, the fair value analysis and related valuations reflect the conclusions of management and not those of any third party. The estimated useful lives and fair values of the identifiable intangible assets at acquisition date were as follows (dollars in thousands): Fair Value Expected Useful Life Discount Rate Software technology $ 3,200 5 years 14.7 % Customer relationships 1,990 7 years 14.7 % Total intangible assets $ 5,190 The identified intangible assets, software technology and customer relationships, were valued as follows: Software technology - we valued the finite-lived software technology using the relief-from-royalty method under the income approach. This method estimates fair value by forecasting avoided royalties, reducing them by maintenance-related research and development expenses and taxes, and discounting the resulting net cash flows to a present value using an appropriate discount rate. We applied judgment which involved the use of assumptions with respect to the future revenue forecast, technology life, royalty rate, and the discount rate. Customer relationships - we valued the finite-lived customer relationships using the multi-period excess-earnings method. This method involves forecasting the net earnings expected to be generated by the asset, reducing them by appropriate returns on contributory assets, and then discounting the resulting net cash flows to a present value using an appropriate discount rate. We applied judgment which involved the use of the assumptions with respect to the future cash flows forecast, base year annual recurring revenue, customer churn rate, and the discount rate. The related software technology amortization expense is recognized over its useful life within cost of revenue in the consolidated statements of operations. The amortization expense related to the customer relationship intangible asset is recognized over the useful life within sales and marketing in the consolidated statements of operations. The weighted-average amortization period of the acquired intangible assets is 5.8 years. We have included the financial results of Outfit in our consolidated financial statements from the date of acquisition. Separate financial results and pro forma financial information for Outfit have not been presented as the effect of this acquisition was not significant to our financial results. Brandfolder On September 14, 2020, we acquired 100% of the outstanding equity of Brandfolder, Inc. (“Brandfolder”), pursuant to an Agreement and Plan of Merger (the “Brandfolder Merger Agreement”). Combining Brandfolder capabilities with Smartsheet creates dynamic solutions that manage workflows around content and collaboration. The Company has included the financial results of Brandfolder in our consolidated financial statements from the acquisition date. We incurred acquisition costs of $1.0 million during the year ended January 31, 2021, and less than $0.1 million during the year ended January 31, 2022. These costs included legal and accounting fees and other costs directly related to the acquisition and are recognized within general and administrative expense in the consolidated statements of operations. The acquisition date fair value of the consideration transferred for Brandfolder was approximately $152.5 million, which consisted of the following (in thousands): Fair Value Cash $ 126,589 Class A Common Stock 25,872 Total $ 152,461 The fair value of the Class A common stock issued as part of the consideration paid for Brandfolder was determined on the basis of the closing market price of Smartsheet’s Class A common stock on the acquisition date. Of the cash paid at closing, $0.7 million was held in a third-party escrow account after closing to secure our indemnification rights under the Brandfolder Merger Agreement, all of which was released from escrow during the year ended January 31, 2022. Additionally, we granted certain continuing Brandfolder employees restricted stock awards with service conditions, which total 96,620 shares of our Class A common stock with an aggregate grant date fair value of $4.5 million that will be accounted for as post-acquisition share-based compensation expense over the vesting period. We incurred share-based compensation expense related to these awards of $1.2 million, $1.5 million, and $0.5 million during the years ended January 31, 2023, January 31, 2022, and January 31, 2021, respectively. We accounted for the transaction as a business combination using the acquisition method of accounting. We allocated the purchase price to the tangible and identifiable intangible assets acquired and liabilities assumed based on their respective estimated fair values on the acquisition date. The excess purchase price consideration was recorded as goodwill, and is primarily attributable to the acquired assembled workforce and expanded market opportunities. The goodwill recognized upon acquisition is not deductible for U.S. federal income tax purposes. Fair values were determined using income and cost approaches. The fair value measurements of the intangible assets were based primarily on significant unobservable inputs and thus represent a Level 3 measurement as defined in ASC 820. We engaged a third-party valuation specialist to aid our analysis of the fair value of the acquired intangibles. All estimates, key assumptions, and forecasts were either provided by or reviewed by us. While we chose to utilize a third-party valuation specialist for assistance, the fair value analysis and related valuations reflect the conclusions of management and not those of any third party. The fair values assigned to assets acquired and liabilities assumed are based on management’s best estimates and assumptions as of the reporting date and are considered final. The following table presents the final allocation of the purchase price at the acquisition date (in thousands): September 14, 2020 Cash $ 2,530 Accounts receivable 2,649 Contract assets 1,620 Right-of-use assets 895 Other assets 991 Intangible assets 45,270 Goodwill 109,108 Accounts payable, accrued expenses, and other current liabilities (1,411) Deferred revenue (4,655) Lease liabilities, non-current (522) Net deferred tax liability (4,014) Total $ 152,461 The estimated useful lives and fair values of the identifiable intangible assets at acquisition date were as follows (dollars in thousands): Fair Value Expected Useful Life Discount Rate Software technology $ 17,400 5 years 10.0 % Customer relationships 16,590 7 years 11.0 % Customer relationships - reseller 7,280 7 years 13.0 % Trade name 4,000 9 years 13.8 % Total intangible assets $ 45,270 The identifiable intangible assets were valued as follows: Software technology - we valued the finite-lived software technology using a relief-from-royalty method under the income approach. This method estimates fair value by forecasting avoided royalties, reducing them by maintenance-related research and development expenses and taxes, and discounting the resulting net cash flows to a present value using an appropriate discount rate. We applied judgment which involved the use of significant assumptions with respect to the future revenue forecast, technology life, royalty rate, and the discount rate. Customer relationships - we valued the finite-lived customer relationships using the multi-period excess earnings method. This method involves forecasting the net earnings expected to be generated by the asset, reducing them by appropriate returns on contributory assets, and then discounting the resulting net cash flows to a present value using an appropriate discount rate. We applied judgment which involved the use of the significant assumptions with respect to the future cash flows forecast, base year annual recurring revenue, customer churn rate, and the discount rate. Customer relationships - reseller - we valued the finite-lived reseller-related customer relationships using an incremental cash flow approach. This method involves forecasting the incremental revenues expected to be generated by having the existing reseller relationship in place at acquisition, reducing them by appropriate operating expenses, taxes, and returns on contributory assets, and then discounting the resulting net cash flows to a present value using an appropriate discount rate. We applied judgment which involved the use of significant assumptions with respect to the future cash flows forecast and the discount rate. Trade name - we valued the finite-lived trade name using the relief-from-royalty method under the income approach. This method involves forecasting avoided royalties, reducing them by income taxes, and then discounting the resulting net cash flows to a present value using an appropriate discount rate. We applied judgment which involved the use of significant assumptions with respect to our income forecast. The related software technology amortization expense is recognized over its useful life within cost of revenues in the consolidated statements of operations. The amortization expense related to customer relationships and trade name intangible assets are recognized over their useful lives within sales and marketing in our consolidated statements of operations. The weighted-average amortization period of the acquired intangible assets is 6.4 years. The amounts of revenue and earnings of Brandfolder included in the Company’s consolidated statements of operations from the acquisition date of September 14, 2020 to January 31, 2021 are as follows (in thousands): January 31, 2021 Revenue $ 5,683 Loss before income tax benefit (4,758) The following unaudited pro forma financial information is for illustrative purposes only and summarizes the combined results of operations for Smartsheet Inc. and Brandfolder, as though the companies were combined as of the beginning of the Company’s fiscal year 2020. The unaudited pro forma financial information was as follows (in thousands): January 31, 2021 2020 Revenue $ 397,160 $ 278,200 Loss before income tax provision (benefit) (122,148) (112,351) Net loss (122,410) (107,374) The pro forma financial information for all periods presented above has been calculated after adjusting the results of Brandfolder to reflect the business combination accounting effects resulting from this acquisition. It includes pro forma adjustments related to the amortization of acquired intangible assets, acquisition costs, share-based compensation expense, alignment of accounting policies, deferred revenue fair value adjustment, and the related income tax effects. The unaudited pro forma results have been prepared based on estimates and assumptions, which we believe are reasonable; however, they are not necessarily indicative of the consolidated results of operations had the acquisition occurred on February 1, 2019, or of future results of operations. |
Goodwill and Net Intangible Ass
Goodwill and Net Intangible Assets | 12 Months Ended |
Jan. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Net Intangible Assets | Goodwill and Net Intangible Assets The changes in the carrying amount of goodwill during the years ended January 31, 2023 and 2022 were as follows (in thousands): Goodwill balance as of January 31, 2021 $ 125,605 Additions and measurement period adjustments — Goodwill balance as of January 31, 2022 125,605 Additions and measurement period adjustments - acquisition of Outfit 16,434 Effects of foreign currency translation 376 Goodwill balance as of January 31, 2023 $ 142,415 No goodwill impairments were recorded during the years ended January 31, 2023, 2022, or 2021. The following table presents the components of net intangible assets (in thousands): As of January 31, 2023 As of January 31, 2022 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Acquired software technology $ 28,673 $ (14,547) $ 14,126 $ 25,400 $ (9,195) $ 16,205 Acquired customer relationships 34,186 (12,265) 21,921 32,150 (7,735) 24,415 Trade names 4,100 (1,157) 2,943 4,100 (711) 3,389 Patents 170 (135) 35 170 (127) 43 Domain name 44 — 44 44 — 44 Total $ 67,173 $ (28,104) $ 39,069 $ 61,864 $ (17,768) $ 44,096 The components of intangible assets acquired as of the periods presented were as follows (dollars in thousands): As of January 31, 2023 As of January 31, 2022 Net Carrying Amount Weighted Average Life (Years) Net Carrying Amount Weighted Average Life (Years) Acquired software technology $ 14,126 2.8 $ 16,205 3.3 Acquired customer relationships 21,921 4.7 24,415 5.5 Trade names 2,943 6.6 3,389 7.6 Total $ 38,990 4.2 $ 44,009 4.9 Amortization expense related to intangible assets was $10.3 million, $10.1 million, and $6.3 million for the years ended January 31, 2023, 2022, and 2021, respectively. As of January 31, 2023, estimated remaining amortization expense for the finite-lived intangible assets by fiscal year is as follows (in thousands): 2024 $ 10,887 2025 9,686 2026 7,969 2027 5,803 2028 3,491 Thereafter 1,189 Total $ 39,025 |
Share-Based Compensation
Share-Based Compensation | 12 Months Ended |
Jan. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Share-Based Compensation | Share-Based Compensation The Company has issued incentive and non-qualifying stock options to employees and non-employee directors under the 2005 Stock Option/Restricted Stock Plan (“2005 Plan”), the 2015 Equity Incentive Plan (“2015 Plan”), and the 2018 Equity Incentive Plan (“2018 Plan”). Employee stock options are granted with exercise prices at the fair value of the underlying common stock on the grant date, generally vest based on continuous employment over three The Company has also issued restricted stock units (“RSUs”) to employees and non-employee directors pursuant to the 2015 Plan and the 2018 Plan. Employee RSUs are measured based on the grant date fair value of the awards and generally vest based on continuous employment over three The Company has issued restricted stock awards (“RSAs”) to certain Brandfolder employees subject to vesting conditions. These shares were issued in a private placement transaction. As vesting of these RSAs is dependent on continuous employment, these were not considered part of the purchase price in accounting for the September 2020 acquisition. The RSAs are measured based on the grant date fair value of the awards and vest based on continuous employment over three years. The Company issued market-based performance share units (“PSUs”) to certain executives pursuant to the 2018 Plan during the year ended January 31, 2023. The target number of market-based PSUs granted was 251,027. The number of shares that can be earned range from 0% to 200% of the target number of shares, based on the relative growth of the Company’s total shareholder return as compared to the total shareholder return of the S&P Software and Services Select Index. These awards have two separate performance periods. The first tranche of awards has a one year performance period starting on the date of grant and ending on the first anniversary of the date of grant. The second tranche of awards has a two year performance period starting on the date of grant and ending on the second anniversary of the date of grant. These awards also include a service condition and vest on a graded vesting schedule, subject to continuous employment, over a three year period. The fair value of the PSUs granted was determined using a Monte Carlo simulation approach. Stock options The following table includes a summary of the option activity during the year ended January 31, 2023: Options Outstanding Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term (years) Aggregate Intrinsic Value (in thousands) Outstanding at January 31, 2022 4,573,482 $ 20.87 6.2 $ 192,982 Granted 253,049 36.34 Exercised (859,115) 9.46 Forfeited or canceled (148,128) 47.80 Outstanding at January 31, 2023 3,819,288 23.42 5.7 90,985 Exercisable at January 31, 2023 3,050,682 15.72 4.9 88,960 Vested and expected to vest at January 31, 2023 3,701,994 22.44 5.6 90,641 The weighted-average grant date fair value per share of stock options granted during the years ended January 31, 2023, 2022, and 2021 was $18.16, $29.71, and $18.95, respectively. The total grant date fair value of stock options vested was $9.1 million, $10.1 million, and $11.1 million during the years ended January 31, 2023, 2022, and 2021, respectively. The intrinsic value of options exercised was $27.0 million, $141.1 million, and $141.3 million during the years ended January 31, 2023, 2022, and 2021, respectively. Restricted stock units The following table includes a summary of the RSU activity during the year ended January 31, 2023: Number of Shares Underlying Outstanding RSUs Weighted-Average Grant-Date Fair Value per RSU Outstanding at January 31, 2022 7,281,232 $ 60.95 Granted 7,965,718 39.16 Vested (2,813,339) 57.03 Forfeited or canceled (1,458,454) 57.82 Outstanding at January 31, 2023 10,975,157 46.56 An RSU award entitles the holder to receive shares of the Company’s common stock as the award vests, which is based on continued service. Non-vested RSUs do not have non-forfeitable rights to dividends or dividend equivalents. The weighted-average grant date fair value of RSUs granted during the years ended January 31, 2023, 2022, and 2021 was $39.16, $68.21, and $43.19, respectively. The total fair value of RSUs vested during the years ended January 31, 2023, 2022, and 2021 was $160.4 million, $78.0 million, and $48.1 million, respectively. Performance Share Units The following table includes a summary of the PSU activity during the year ended January 31, 2023: Number of Shares Weighted-Average Grant-Date Fair Value per Share Outstanding at January 31, 2022 — $ — Granted 251,027 53.34 Vested — — Forfeited or canceled — — Outstanding at January 31, 2023 251,027 53.34 The weighted-average grant date fair value of PSUs granted during the year ended January 31, 2023 was $53.34. Restricted stock awards The following table includes a summary of RSA activity during the year ended January 31, 2023: Number of Shares Weighted-Average Grant-Date Fair Value per Share Outstanding at January 31, 2022 56,288 $ 46.93 Granted — — Vested (28,144) 46.93 Forfeited or canceled (8,249) 46.93 Outstanding at January 31, 2023 19,895 46.93 The weighted-average grant date fair value of RSAs granted during the year ended January 31, 2021 was $46.93. The total fair value of RSAs vested during the years ended January 31, 2023 and 2022 was $1.3 million and $1.6 million, respectively. No RSAs vested during the year ended January 31, 2021. 2018 Employee Stock Purchase Plan In April 2018, we adopted our ESPP. The ESPP became effective on April 26, 2018, with the effective date of our IPO. Under our ESPP, eligible employees are able to acquire shares of the Company’s Class A common stock by accumulating funds through payroll deductions of up to 15% of their compensation, subject to plan limitations. Purchases are accomplished through participation in discrete offering periods. Each offering period is six months (commencing each January 1 and July 1) and consists of one six-month purchase period, unless otherwise determined by our board of directors or our compensation committee. Prior to January 2022, each offering period commenced on March 25 and September 25. The change in offering periods required an abbreviated, one-time purchase period from September 25, 2021 through December 31, 2021 to align to the new offering periods. The purchase price for shares of our common stock purchased under our ESPP is 85% of the lesser of the fair market value of our common stock on (i) the first trading day of the applicable offering period or (ii) the last trading day of the purchase period in the applicable offering period. The following table includes a summary of the activity of shares available for issuance under our 2018 Plan and our ESPP during the year ended January 31, 2023: Shares Available for Issuance 2018 Plan 2018 ESPP Balance at January 31, 2022 15,067,025 4,040,430 Authorized 6,390,477 1,278,096 Granted (8,469,794) (467,751) Forfeited 1,606,582 — Balance at January 31, 2023 14,594,290 4,850,775 The aggregate number of shares reserved for issuance under our ESPP will increase automatically on February 1 of each of the first 10 calendar years after the first offering date under the ESPP by the number of shares equal to 1% of the total outstanding shares of our Class A common stock and Class B common stock as of the immediately preceding January 31 (rounded to the nearest whole share) or such lesser number of shares as may be determined by our board of directors in any particular year. The aggregate number of shares issued over the term of our ESPP, subject to stock-splits, recapitalizations or similar events, may not exceed 20,400,000 shares of our Class A common stock. As of January 31, 2023, $2.0 million has been withheld on behalf of employees for a future purchase under the ESPP and is recorded in accrued compensation and related benefits in the consolidated balance sheet. Valuation assumptions The fair value of employee stock options and ESPP purchase rights was estimated using a Black-Scholes option pricing model. The fair value of the PSUs was estimated using a Monte Carlo simulation valuation model. The fair values of the Company’s stock options, ESPP purchase rights, and PSUs granted during the years ended January 31, 2023, 2022, and 2021 were estimated using the following assumptions: Year Ended January 31, 2023 2022 2021 Employee Stock Options Risk-free interest rate 1.8%-3.7% 1.0%-1.4% 0.6%-0.7% Expected volatility 44.2%-46.3% 43.1%-43.5% 43.0%-43.5% Expected term (in years) 6.25 6.25 6.25 Expected dividend yield — % — % — % Employee Stock Purchase Plan Risk-free interest rate 0.2%-2.5% 0.0%-0.1% 0.1%-1.9% Expected volatility 50.0%-72.8% 46.9%-68.0% 39.9%-68.0% Expected term (in years) 0.50 0.27-0.50 0.50 Expected dividend yield — % — % — % Performance Share Units Risk-free interest rate 4.3 % — — Expected volatility 52.5 % — — Expected volatility (S&P Software and Services Select Index) 31.8 % — — Expected term (in years) 1.00-2.00 — — Expected dividend yield — % — — The risk-free interest rate used in the Black-Scholes option pricing model is based on the U.S. Treasury yield that corresponds with the expected term at the time of grant. The risk-free rate used in the Monte Carlo simulation valuation model is the continuously compounded yield on zero-coupon U.S. Treasury bonds that corresponds with the longest expected term. The expected term of an option is determined using the simplified method, which is calculated as the average of the contractual life and the vesting period. The expected term for the ESPP purchase rights is estimated using the offering period, which is typically six months. The expected term for the PSUs is estimated by using the related performance period. We estimate volatility for options and PSUs using volatilities of a group of public companies in a similar industry, stage of life cycle, and size; and volatility of ESPP purchase rights using our own volatility history. The Company does not currently pay dividends and does not expect to for the foreseeable future. In addition to the assumptions used in the Black-Scholes option pricing and the Monte Carlo simulation models, we must also estimate a forfeiture rate to calculate the share-based compensation expense for awards. Our forfeiture rate is derived from historical employee termination behavior. If the actual number of forfeitures differs from these estimates, additional adjustments to compensation expense will be required. Share-based compensation expense Share-based compensation expense included in the consolidated statements of operations was as follows (in thousands): Year Ended January 31, 2023 2022 2021 Cost of subscription revenue $ 11,248 $ 6,274 $ 4,385 Cost of professional services revenue 6,404 3,788 2,146 Research and development 62,165 41,218 25,072 Sales and marketing 63,224 40,632 25,921 General and administrative 33,514 22,988 14,498 Total share-based compensation $ 176,555 $ 114,900 $ 72,022 We have excluded $3.5 million for the year ended January 31, 2023, and $2.0 million for each of the years ended January 31, 2022 and 2021, of capitalized software development costs from stock-based compensation expense. As of January 31, 2023, there was a total of $491.8 million of unrecognized share-based compensation expense, which is expected to be recognized over a weighted-average period of 2.7 years. |
Income Taxes
Income Taxes | 12 Months Ended |
Jan. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The components of loss before income tax provision (benefit) were as follows (in thousands): Year Ended January 31, 2023 2022 2021 United States $ (216,167) $ (174,043) $ (120,958) Foreign 3,377 3,242 2,226 Loss before income tax provision (benefit) $ (212,790) $ (170,801) $ (118,732) The income tax provision (benefit) consisted of the following (in thousands): Year Ended January 31, 2023 2022 2021 Current: Federal $ 876 $ — $ — State 1,239 175 115 Foreign 1,085 49 63 Total current tax provision (benefit) 3,200 224 178 Deferred and other: Federal — — (3,117) State — — (898) Foreign (351) 72 84 Total deferred tax provision (benefit) (351) 72 (3,931) Total income tax provision (benefit) $ 2,849 $ 296 $ (3,753) Income tax expense for the year ended January 31, 2023 was primarily related to taxable profits in the U.S. as a result of the capitalization of research and experimental expenditures under IRC Section 174 as well as income taxes in foreign jurisdictions. Income tax expense for the year ended January 31, 2022 was recognized primarily due to income taxes in foreign jurisdictions and state income taxes. Income tax benefit for the year ended January 31, 2021 was recognized primarily due to a release of the Company’s federal and state valuation allowance on deferred tax assets as a result of the deferred tax liabilities established for definite lived intangible assets from the acquisition of Brandfolder, offset by income taxes in foreign jurisdictions and state income taxes. The reconciliation of federal statutory income tax to the Company’s provision for income taxes is as follows (in thousands): Year Ended January 31, 2023 2022 2021 Income tax at statutory federal rate $ (44,686) $ (35,868) $ (24,934) Tax credits (7,660) (5,697) (5,657) Change in valuation allowance 44,898 71,738 51,296 Share-based compensation 7,558 (30,092) (24,057) Global intangible low taxed income inclusion 2,276 — — Other 463 215 (401) Total income tax provision (benefit) $ 2,849 $ 296 $ (3,753) Deferred income taxes reflect the net tax effects of loss and credit carryforwards and temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The tax effects of temporary differences and related deferred tax assets and liabilities as of January 31, 2023 and 2022 were as follows (in thousands): January 31, 2023 2022 Deferred tax assets: Net operating loss carryforwards $ 121,171 $ 147,348 Deferred revenue 117,579 82,904 Capitalized research & experimental expenditures 45,906 — Tax credits 29,267 23,677 Lease liabilities 17,273 19,379 Share-based compensation 17,282 16,595 Accrued compensation 8,983 5,711 Other 982 1,097 Total deferred tax assets 358,443 296,711 Valuation allowance (302,196) (247,130) Total deferred tax assets, net 56,247 49,581 Deferred tax liabilities: Capitalized commissions (30,836) (23,242) Lease right-of-use assets (14,320) (17,023) Intangibles (7,637) (8,265) Property and equipment (2,250) (1,186) Other (989) — Total deferred tax liabilities (56,032) (49,716) Net deferred tax assets (liabilities) $ 215 $ (135) Management assesses the available positive and negative evidence to estimate whether sufficient future taxable income will be generated to permit use of the existing deferred tax assets. A significant piece of objective negative evidence evaluated was the cumulative loss incurred over the three-year period ended January 31, 2023. Such objective evidence limits the ability to consider other subjective evidence, such as the Company’s projections for future growth. On the basis of this evaluation, the Company has established a full valuation allowance equal to its U.S. net deferred tax assets due to the uncertainty of future realization of the net deferred tax assets. The valuation allowance increased by $55.1 million during the year ended January 31, 2023. The increase in the valuation allowance was primarily related to an increase in deferred tax assets capitalization of research and experimental expenditures required under IRC Section 174, offset by a decrease in deferred tax assets related to net operating losses. As of January 31, 2023, we had net operating loss carryforwards (“NOLs”) of $473.8 million for U.S. federal income taxes and $307.8 million for state and local income taxes. U.S. federal NOLs of $419.3 million may be carried forward indefinitely, and U.S. federal NOLs of $54.5 million will expire on various dates starting in 2025. The state NOL carryforwards will begin to expire in 2025. As of January 31, 2023, the Company’s tax credit carryforwards for income tax purposes were approximately $29.2 million net of uncertain tax positions for research and development credits. If not used, the tax credit carryforwards will begin to expire in 2038. The Company’s operations in Costa Rica are located in a Free Trade Zone (“FTZ”) which entitles the Company to certain tax incentives including a tax holiday from corporate income tax or a reduced corporate tax rate. The FTZ benefits are conditional on the Company meeting certain employment and investment thresholds. These tax incentives are effective into 2034 and may be extended if additional requirements are satisfied. The impact of the tax holiday was not material. Accounting guidance for income taxes requires a deferred tax liability to be established for the U.S. tax impact of undistributed earnings of foreign subsidiaries unless it can be shown that these earnings will be permanently reinvested outside the U.S. If the Company’s foreign earnings were to be repatriated in the future, the estimated U.S. tax liability would be insignificant. The calculation of the Company’s tax obligations involves dealing with uncertainties in the application of complex tax laws and regulations. ASC 740, Income Taxes , provides that a tax benefit from an uncertain tax position may be recognized when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, on the basis of the technical merits. The Company has assessed its income tax positions and recorded tax benefits for all years subject to examination, based upon its evaluation of the facts, circumstances, and information available at each period end. For those tax positions where the Company has determined there is a greater than 50% likelihood that a tax benefit will be sustained, the Company has recorded the largest amount of tax benefit that may potentially be realized upon ultimate settlement with a taxing authority that has full knowledge of all relevant information. For those income tax positions where it is determined there is less than 50% likelihood that a tax benefit will be sustained, no tax benefit has been recognized. The following is a tabular reconciliation of the total amounts of unrecognized tax benefits: Year Ended January 31, 2023 2022 2021 Balance, beginning of the year $ 7,204 $ 5,283 $ 3,339 Increases to tax positions taken during the current year 2,218 2,010 2,046 Increases to tax positions taken in prior years 461 — 11 Decreases to tax positions taken in prior years (89) (113) Balance, end of year $ 9,883 $ 7,204 $ 5,283 Although the Company believes that it has adequately reserved for its uncertain tax positions, it can provide no assurance that the final tax outcome of these matters will not be materially different. The Company makes adjustments to its reserves when facts and circumstances change, such as the closing of a tax audit or the refinement of an estimate. To the extent that the final tax outcome of these matters is different than the amounts recorded, such differences will affect the provision for income taxes in the period in which such determination is made. No liability was recorded for uncertain tax positions, or related interest or penalties, as of January 31, 2023 or 2022. As of January 31, 2023 and 2022, the Company had $9.9 million and $7.2 million of unrecognized tax benefits, respectively, of which the total amount that would impact the effective tax rate, if recognized, is $9.9 million and $7.2 million, respectively. Any impact on the effective tax rate for unrecognized tax benefits would be offset by the impact of the Company's full valuation allowance on its U.S. federal and state deferred tax assets. In the U.S., the Company’s tax years from 2005 to present remain effectively open to examination by the Internal Revenue Service, as well as various state and foreign jurisdictions. Interest or penalties, if incurred, are recognized as a component of income tax expense. Penalties and interest recognized were not material for the years ended January 31, 2023, 2022, and 2021. On August 16, 2022, the Inflation Reduction Act (the “IRA”) was signed into law. The IRA contains a number of tax related provisions including a 15% minimum corporate income tax on certain large corporations as well as an excise tax on stock repurchases. The Company evaluated the IRA and concluded it does not have a material impact on the Company’s consolidated financial statements. |
Leases
Leases | 12 Months Ended |
Jan. 31, 2023 | |
Leases [Abstract] | |
Leases | Leases The Company has operating leases primarily related to corporate offices and certain equipment. During the year ended January 31, 2021, the Company had finance leases primarily related to data center equipment, which were paid off in that year. Our leases have remaining lease terms of less than one year to six years, some of which include options to extend the leases for up to five years. The components of lease expense recorded in the consolidated statements of operations were as follows (in thousands): Year Ended January 31, 2023 2022 2021 Operating lease cost $ 22,508 $ 18,739 $ 15,586 Finance lease cost: Amortization of assets — — 3,093 Interest on lease liabilities — — 114 Short-term lease cost 950 371 1,493 Variable lease cost 2,833 2,850 2,606 Sublease income (527) — — Total lease costs $ 25,764 $ 21,960 $ 22,892 Other information related to leases was as follows (in thousands): Year Ended January 31, 2023 2022 2021 Supplemental cash flow information: Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows related to operating leases* $ 19,735 $ 17,610 $ 14,249 Operating cash flows related to finance leases — — 114 Financing cash flows related to finance leases — — 4,129 Right-of-use assets obtained in exchange for new operating lease liabilities 7,230 994 35,415 Right-of-use assets reductions related to operating leases 4,696 — — Supplemental balance sheet information related to our operating leases was as follows: January 31, 2023 2022 Weighted-average remaining lease term (in years) 4.5 5.3 Weighted-average discount rate 5.3 % 5.0 % As of January 31, 2023, the reconciliation of the undiscounted cash flows to the total operating lease liabilities were as follows (in thousands): Operating Leases Fiscal 2024 $ 19,683 Fiscal 2025 17,029 Fiscal 2026 14,577 Fiscal 2027 10,868 Fiscal 2028 6,078 Thereafter 6,235 Total payments 74,470 Less: imputed interest (7,686) Total operating lease liabilities $ 66,784 As of January 31, 2023, the future total minimum sublease payments to be received were as follows (in thousands): Sublease Receipts Fiscal 2024 $ 1,495 Fiscal 2025 1,592 Fiscal 2026 1,645 Fiscal 2027 700 Thereafter — Total $ 5,432 During the year ended January 31, 2023, the Company reassessed its real estate footprint which resulted in real estate restructuring activities. The Company entered into two sublease agreements for certain fully furnished floors in Bellevue, Washington. We evaluated the associated asset groups for impairment, which included the ROU assets and underlying property and equipment on each subleased floor. We compared the expected future undiscounted cash flows for each subleased floor to its carrying value and determined that the respective asset groups were not recoverable. We compared the estimated fair value, based on the present value of the estimated cash flows from each sublease, to its carrying value, which resulted in a $1.5 million consolidated impairment charge. The impairment charges were included in general and administrative expenses in the consolidated statements of operations. During the year ended January 31, 2023, the Company also abandoned certain floors in Bellevue, Washington for which there was no intent or ability to sublease. The remaining lease cost was accelerated between the decision date and abandonment date. Additionally, the Company terminated the lease in connection with its Denver, Colorado office facility. These two real estate restructuring activities led to lease charges of $3.5 million, which were allocated based on headcount to each cost of revenue and operating expense category in the consolidated statements of operations. |
Leases | Leases The Company has operating leases primarily related to corporate offices and certain equipment. During the year ended January 31, 2021, the Company had finance leases primarily related to data center equipment, which were paid off in that year. Our leases have remaining lease terms of less than one year to six years, some of which include options to extend the leases for up to five years. The components of lease expense recorded in the consolidated statements of operations were as follows (in thousands): Year Ended January 31, 2023 2022 2021 Operating lease cost $ 22,508 $ 18,739 $ 15,586 Finance lease cost: Amortization of assets — — 3,093 Interest on lease liabilities — — 114 Short-term lease cost 950 371 1,493 Variable lease cost 2,833 2,850 2,606 Sublease income (527) — — Total lease costs $ 25,764 $ 21,960 $ 22,892 Other information related to leases was as follows (in thousands): Year Ended January 31, 2023 2022 2021 Supplemental cash flow information: Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows related to operating leases* $ 19,735 $ 17,610 $ 14,249 Operating cash flows related to finance leases — — 114 Financing cash flows related to finance leases — — 4,129 Right-of-use assets obtained in exchange for new operating lease liabilities 7,230 994 35,415 Right-of-use assets reductions related to operating leases 4,696 — — Supplemental balance sheet information related to our operating leases was as follows: January 31, 2023 2022 Weighted-average remaining lease term (in years) 4.5 5.3 Weighted-average discount rate 5.3 % 5.0 % As of January 31, 2023, the reconciliation of the undiscounted cash flows to the total operating lease liabilities were as follows (in thousands): Operating Leases Fiscal 2024 $ 19,683 Fiscal 2025 17,029 Fiscal 2026 14,577 Fiscal 2027 10,868 Fiscal 2028 6,078 Thereafter 6,235 Total payments 74,470 Less: imputed interest (7,686) Total operating lease liabilities $ 66,784 As of January 31, 2023, the future total minimum sublease payments to be received were as follows (in thousands): Sublease Receipts Fiscal 2024 $ 1,495 Fiscal 2025 1,592 Fiscal 2026 1,645 Fiscal 2027 700 Thereafter — Total $ 5,432 During the year ended January 31, 2023, the Company reassessed its real estate footprint which resulted in real estate restructuring activities. The Company entered into two sublease agreements for certain fully furnished floors in Bellevue, Washington. We evaluated the associated asset groups for impairment, which included the ROU assets and underlying property and equipment on each subleased floor. We compared the expected future undiscounted cash flows for each subleased floor to its carrying value and determined that the respective asset groups were not recoverable. We compared the estimated fair value, based on the present value of the estimated cash flows from each sublease, to its carrying value, which resulted in a $1.5 million consolidated impairment charge. The impairment charges were included in general and administrative expenses in the consolidated statements of operations. During the year ended January 31, 2023, the Company also abandoned certain floors in Bellevue, Washington for which there was no intent or ability to sublease. The remaining lease cost was accelerated between the decision date and abandonment date. Additionally, the Company terminated the lease in connection with its Denver, Colorado office facility. These two real estate restructuring activities led to lease charges of $3.5 million, which were allocated based on headcount to each cost of revenue and operating expense category in the consolidated statements of operations. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Jan. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Lease commitments We have entered into various non-cancelable lease agreements related to our corporate offices and certain equipment. For additional information regarding our lease agreements, see Note 13, Leases . Purchase commitments We have entered into certain non-cancelable multi-year agreements with third-party providers primarily for our use of cloud-based hosting services. As of January 31, 2023, our future estimated purchase commitments related to these contracts by fiscal year are as follows (in thousands): Fiscal 2024 $ 49,390 Fiscal 2025 64,350 Fiscal 2026 46,366 Fiscal 2027 — Fiscal 2028 — Thereafter — Total $ 160,106 Legal matters An indemnification claim was made against the Company by a former director, Ryan Hinkle, and Insight Venture Partners VII, L.P. and certain affiliated entities that are former shareholders of the Company (together with Hinkle, the “IVP Parties”), relating to a purported class action litigation in which the IVP Parties are defendants. On January 29, 2021, the IVP Parties filed a complaint against the Company in the Superior Court of Washington, King County, for the advancement of legal fees, costs, and expenses incurred in defending the purported class action claim. In December 2021, we paid $10.0 million as part of an overall settlement of these matters. We do not expect any additional losses related to this that would have a material impact on our financial position, results of operations, or cash flows. During the year ended January 31, 2023, we recovered $4.5 million related to insurance coverage of this claim. In February 2023, we settled an additional insurance reimbursement claim related to this case. As a result of this settlement, we have recorded an insurance reimbursement receivable of $3.9 million in prepaid and other current assets in our consolidated balance sheets as of January 31, 2023. The impact of these insurance recoveries is included in general and administrative expenses in our consolidated statement of operations. From time-to-time, in the normal course of business, the Company may be subject to various other legal matters such as threatened or pending claims or proceedings. Although management currently believes that resolution of such matters, individually and in the aggregate, will not have a material impact on our financial position, results of operations, or cash flows, these matters are subject to inherent uncertainties, and management’s view of these matters may change in the future. |
401(k) and Pension Plans
401(k) and Pension Plans | 12 Months Ended |
Jan. 31, 2023 | |
Retirement Benefits [Abstract] | |
401(k) and Pension Plans | 401(k) and Pension Plans In March 2008, the Company initiated a 401(k) plan for the benefit of all United States employees. In the second quarter of fiscal 2021, we began to match 50% of each participant’s contribution up to a maximum of 6% of the participant’s eligible pay during the period. We recognized an expense of $9.5 million, $6.7 million, and $4.4 million related to matching contributions during the years ended January 31, 2023, 2022, and 2021 respectively. In January 2018, the Company began contributing to a pension plan for the benefit of its employees based in the United Kingdom. In January 2020, the Company began contributing to a pension plan for the benefit of its employees based in Australia. We recognized an expense related to employer contributions of $2.5 million, $1.6 million, and $1.0 million during the years ended January 31, 2023, 2022, and 2021, respectively. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Jan. 31, 2023 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party TransactionsCertain members of the board of directors serve as directors of, or are executive officers of, and in some cases are investors in, companies that are customers or vendors of the Company. Certain of the Company’s executive officers also serve as directors of, or serve in an advisory capacity to, companies that are customers or vendors of the Company. Related-party transactions were not material as of and for the years ended January 31, 2023, 2022, and 2021. |
Geographic Information
Geographic Information | 12 Months Ended |
Jan. 31, 2023 | |
Segment Reporting [Abstract] | |
Geographic Information | Geographic Information Revenue Revenue by geographic location is determined by the location of the Company’s customers. The following table sets forth revenue by geographic area (in thousands): Year Ended January 31, 2023 2022 2021 United States $ 640,604 $ 454,246 $ 314,177 EMEA 65,574 51,603 37,463 Asia Pacific 29,946 21,326 15,325 Americas other than the United States 30,791 23,657 18,548 Total $ 766,915 $ 550,832 $ 385,513 No individual country other than the United States contributed more than 10% of total revenue during any of the periods presented. Long-lived assets Long-lived assets by geographic location is based on the location of the legal entity that owns the asset. The following table sets forth long-lived assets by geographic area (in thousands): January 31, 2023 2022 United States $ 60,246 $ 79,278 EMEA 5,583 3,828 Asia Pacific 4,510 1,153 Americas other than the United States 274 28 Total $ 70,613 $ 84,287 |
Subsequent Events
Subsequent Events | 12 Months Ended |
Jan. 31, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events In February 2023, we settled an insurance reimbursement claim related to the IVP Parties indemnification claim described in Note 14, Commitments and Contingencies. As a result of this settlement, an insurance reimbursement receivable of $3.9 million was recorded in prepaid and other current assets in our consolidated balance sheets as of January 31, 2023. For further information on our legal proceedings, see Note 14, Commitments and Contingencies, |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Jan. 31, 2023 | |
Accounting Policies [Abstract] | |
Basis of presentation | Basis of presentation The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in th e United States of America (“GAAP”), and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding financial reporting. The Company’s fiscal year ends on January 31. The consolidated financial statements include the results of Smartsheet Inc. and its wholly owned subsidiaries, including those located in the United States, the United Kingdom, Germany, Australia, Japan, and Costa Rica. All intercompany balances and transactions have been eliminated upon consolidation. |
Use of estimates | Use of estimates The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates, judgments, and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenue and expenses during the reporting periods. The Company bases its estimates on historical experience and on other assumptions that its management believes are reasonable under the circumstances. Actual results could differ from those estimates. The Company’s most significant estimates and judgments involve the measurement of fair values of share-based compensation award grants; determination of the amortization period for capitalized sales commission costs; and revenue recognition with respect to the allocation of transaction consideration for the Company’s offerings , among others. The Company completed an assessment of the amortization period for deferred sales commission costs and determined that it should increase the period over which we amortize deferred commissions from three years to four years. This change in accounting estimate was effective August 1, 2022 and is being accounted for prospectively in the consolidated financial statements. For the year ended January 31, 2023, the change in amortization period resulted in a benefit to both sales and marketing expense and net loss of approximately 2% of total revenue or $0.09 per basic and diluted share. The effect of this change in estimate is based on the carrying value of deferred commissions included in the Company’s consolidated balance sheets as of July 31, 2022 and those deferred during the six months ended January 31, 2023. |
Segment information | Segment information The Company operates as one operating segment. The Company’s chief operating decision maker is its Chief Executive Officer, who reviews consolidated financial information for purposes of making operating decisions, assessing financial performance, and allocating resources. |
Revenue recognition, Deferred revenue, Deferred commissions, and Overhead allocations | Revenue recognition The Company derives its revenue primarily from subscription services and professional services. Revenue is recognized when control of these services is transferred to the Company ’ s customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those services, net of any sales taxes. The Company determines revenue recognition through the following steps: • identification of the contract, or contracts, with a customer; • identification of the performance obligations in the contract; • determination of the transaction price; • allocation of the transaction price to the performance obligations in the contract; and • recognition of revenue when, or as, the Company satisfies a performance obligation. Subscription revenue Subscription revenue primarily consists of fees from customers for access to the Company’s cloud-based platform and involves a significant volume of transactions. The Company uses automated systems to process and record these transactions. S ubscription revenue is recognized on a ratable basis over the subscription contract term, beginning on the date the access to the Company ’ s platform is provided, as no implementation work is required, if consideration the Company is entitled to receive is probable of collection. Subscription contracts generally have terms of one year or one month, are billed in advance, and are non-cancelable. The subscription arrangements do not allow the customer the contractual right to take possession of the platform; as such, the arrangements are considered to be service contracts. Certain of the Company ’ s subscription contracts contain performance guarantees related to service continuity. To date, refunds related to such guarantees have been immaterial in all periods presented. On occasion, the Company sells its subscriptions to third-party resellers. The price at which the Company sells to the reseller is typically discounted, as compared to the price at which the Company would sell to an end customer, in order to enable the reseller to realize a margin on the eventual sale to the end customer. As our pricing to the reseller is fixed, and the Company does not have visibility into the pricing provided by the reseller to the end customer, the revenue is recorded net of any reseller margin. Professional services revenue Professional services revenue primarily includes revenue recognized from fees for consulting and training services. The Company’s consulting services consist of platform configuration and use case optimization, and are primarily invoiced on a time and materials basis, monthly in arrears. Services revenue is recognized over time, as service hours are delivered. Smaller consulting engagements are, on occasion, provided for a fixed fee. These smaller consulting arrangements are typically of short duration (less than three months). In these cases, revenue is recognized over time, based on the proportion of hours of work performed, compared to the total hours expected to complete the engagement. Configuration and use case optimization services do not result in significant customization or modification of the software platform or user interface. Training services are billed in advance, on a fixed-fee basis, and revenue is recognized after the training program is delivered, or after the customer’s right to receive training services expires. Associated out-of-pocket travel expenses related to the delivery of professional services are typically reimbursed by the customer. Out-of-pocket expense reimbursements are recognized as revenue at the point in time, or as the distinct performance obligation to which they relate is delivered. Out-of-pocket expenses are recognized as cost of professional services as incurred. Contracts with multiple performance obligations Some of the Company’s contracts with customers contain multiple performance obligations. The Company accounts for individual performance obligations separately, as they have been determined to be distinct, i.e., the services are separately identifiable from other items in the arrangement and the customer can benefit from them on their own or with other resources that are readily available to the customer. The transaction price is allocated to the distinct performance obligations on a relative stand-alone selling price basis. Stand-alone selling prices are determined based on the prices at which the Company separately sells subscription, consulting, and training services, and based on t he Company’s overall pricing objectives, taking into consideration market conditions, value of t he Company’s contracts, the types of offerings sold, customer demographics, and other factors. Accounts receivable and allowance for doubtful accounts Accounts receivable are primarily comprised of trade receivables that are recorded at the invoice amount, net of an allowance for doubtful accounts. Subscription fees billed in advance of the related subscription term represent contract liabilities and are presented as accounts receivable and deferred revenues upon establishment of the unconditional right to invoice, typically upon signing of the non-cancelable service agreement. Our typical payment terms provide for customer payment within 30 days of the invoice date. The allowance for doubtful accounts is based on the Company’s estimated expected credit losses derived upon assessment of various factors including historical trends on collectibility, composition of accounts receivable by aging, current market conditions, reasonable and supportable forecasts of future economic conditions, and other factors. The estimated credit losses are recorded to the allowance for doubtful accounts in the consolidated balance sheets, with an offsetting decrease in related deferred revenue and a reduction of revenue or charge to general and administrative expense in the consolidated statements of operations. Activity related to the Company’s allowance for doubtful accounts was as follows (in thousands): January 31, 2023 2022 2021 Beginning balance $ 7,561 $ 6,933 $ 2,989 Additions 5,440 7,700 6,540 Write-offs (6,716) (7,072) (2,596) Ending balance $ 6,285 $ 7,561 $ 6,933 Deferred revenue Deferred revenue consists of customer billings and payments in advance of revenue being recognized from the Company’s contracts. The Company typically invoices its customers annually in advance for its subscription-based contracts. Deferred revenue and accounts receivable are recorded at the beginning of a new subscription term. For some customers, the Company invoices in monthly, quarterly, semi-annual, or multi-year installments and, therefore, the deferred revenue balance does not necessarily represent the total contract value of all non-cancelable subscription agreements. Deferred revenue anticipated to be recognized during the succeeding 12-month period is recorded as deferred revenue and the remaining portion is recorded as deferred revenue, non-current in our consolidated balance sheets. Deferred commissions The majority of sales commissions earned by the Company ’s sales force are considered incremental and recoverable costs of obtaining a contract with a customer. Sales commissions are paid on initial contracts and on any upsell contracts with a customer. No sales commissions are paid on customer renewals. Sales commissions and related payroll taxes and incremental fringe benefits are deferred and then amortized on a straight-line basis over a period of benefit that the Company has determined to be four years. The Company determined the period of benefit by taking into consideration its customer contracts, expected customer life, the expected life of its technology, and other factors. Amortization expense is included in sales and marketing expense in the consolidated statements of operations. The Company evaluates the period of benefit and tests for impairment on a quarterly basis and whenever events or changes in circumstances occur that could impact the recoverability of these assets. Overhead allocations |
Cash, cash equivalents, and short-term investments | Cash, cash equivalentsThe Company considers all highly liquid investments with an original maturity of three months or less from date of purchase to be cash equivalents. Cash and cash equivalents are recorded at cost, which approximates fair value. Interest earned on cash and cash equivalents is recorded in interest income in the consolidated statements of operations. |
Restricted cash | Restricted cash Restricted cash, which primarily relates to Australian employee contributions to our ESPP, was $0.6 million, $0.6 million, and $0.1 million as of January 31, 2023, 2022, and 2021, respectively. |
Short-term investments | Short-term investments The Company’s short-term investments primarily consist of U.S. Treasury securities, corporate bonds, commercial paper, and agency securities that have original maturities greater than three months at the time of purchase. These investments are classified as available-for-sale securities and we reevaluate such classification as of each balance sheet date. The Company considers all investments as available for use in current operations, including those with maturity dates beyond one year, and therefore classifies these securities as current assets in its consolidated balance sheets. |
Business combinations | Business combinations When we acquire a business, the purchase price is allocated to the assets acquired and liabilities assumed based on their estimated fair values as of the acquisition date. Any residual purchase price is recorded as goodwill. The allocation of the purchase price requires management to make significant estimates in determining the fair values of the assets acquired and liabilities assumed, especially with respect to the identifiable intangible assets. These estimates can include, but are not limited to, the cash flows that an asset is expected to generate in the future, the appropriate weighted-average cost of capital, the cost savings expected to be derived from acquiring an asset, its expected remaining economic useful life, and the appropriate discount rate to employ in the valuation analyses in order to properly account for the risk associated with the asset’s expected future cash flows. These estimates are inherently uncertain. During the measurement period, which may be up to one year from the acquisition date, adjustments to the fair value of these tangible and intangible assets acquired and liabilities assumed may be recorded, with the corresponding offset to goodwill. Upon the conclusion of the measurement period or final determination of the fair value of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded to our consolidated statements of operations and consolidated statements of comprehensive loss. |
Goodwill and acquired intangible assets | Goodwill and acquired intangible assets The Company evaluates goodwill for impairment at the reporting unit level on an annual basis (September 1), or whenever events or changes in circumstances indicate that impairment may exist. Events or changes in circumstances which could trigger an impairment review include, but are not limited to, a significant adverse change in customer demand or business climate or a significant decrease in expected cash flows. When evaluating goodwill for impairment, the Company may first perform a qualitative assessment to determine whether it is more likely than not that a reporting unit is impaired. If the Company does not perform a qualitative assessment, or if the Company determines that it is not more likely than not that the fair value of the reporting unit exceeds its carrying amount, the Company calculates the estimated fair value of the reporting unit. If the carrying amount of the reporting unit exceeds the estimated fair value, an impairment charge is recorded to reduce the carrying value to the estimated fair value. No impairment charges were recorded for the years ended January 31, 2023, 2022, or 2021. Acquired intangible assets consist of identifiable intangible assets, primarily software technology and customer relationships, resulting from our acquisitions. Intangible assets are recorded at fair value on the date of acquisition and amortized over their estimated useful lives. |
Property and equipment | Property and equipmentProperty and equipment are recorded at cost, net of accumulated depreciation and amortization.Leasehold improvements are amortized over the shorter of the expected useful lives of the assets or the related lease term. Maintenance and repairs that do not improve or extend the lives of the respective assets are expensed as incurred. |
Internal-use software development costs | Internal-use software development costs The Company capitalizes certain qualifying costs incurred during the application development stage in connection with the development of internal-use software. Costs related to preliminary project activities and post-implementation activities are expensed in research and development (“R&D”) as incurred. R&D expenses consist primarily of employee-related costs, software-related costs, allocated overhead, and costs of outside services used to supplement our internal staff. Internal-use software costs of $11.0 million and $8.6 million were capitalized in the years ended January 31, 2023 and 2022, respectively. All capitalized costs related to costs incurred during the application development stage of software development for the Company’s platform to which subscriptions are sold. |
Leases | Leases The Company determines if an arrangement is a lease at inception, and leases are classified at commencement as either operating or finance leases. All of the Company’s existing leases are classified as operating leases. Right-of-use (“ROU”) assets and lease liabilities are recognized at commencement date based on the present value of the future minimum lease payments over the lease term. ROU assets also include any lease payments made. As our operating leases do not provide an implicit rate, we estimate our incremental borrowing rate based on information available at the commencement date in determining the present value of future payments. This rate is an estimate of the collateralized borrowing rate the Company would incur on its future lease payments over a similar term based on the information available at commencement date. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. At January 31, 2023, we did not include any options to extend leases in our lease terms as we were not reasonably certain to exercise them. The Company’s lease agreements do not contain residual value guarantees or covenants. The Company utilizes certain practical expedients and policy elections available under the lease accounting standard. Leases with a term of one year or less are not recognized on our consolidated balance sheets; we recognize lease expense for these leases on a straight-line basis over the lease term. Additionally, we have elected to include non-lease components with lease components for the purpose of calculating lease ROU assets and liabilities, to the extent that they are fixed. Non-lease components that are not fixed are expensed as incurred as variable lease payments. Our operating leases typically include non-lease components such as common-area maintenance costs. The Company accounts for subleases from the perspective of a lessor. The Company has two subleases, which are both classified as operating leases. The Company records sublease income as a reduction of lease expense using the straight-line method over the term of the sublease. |
Impairment of long-lived assets | Impairment of long-lived assetsLong-lived assets, such as property and equipment, intangible assets, operating lease ROU assets, and internal-use software development costs, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset group may not be recoverable. Recoverability of an asset group is measured by comparing the carrying amount to the estimated undiscounted future cash flows expected to be generated. When the carrying amount exceeds the undiscounted cash flows, the assets are adjusted to their estimated fair value and an impairment charge is recognized as the amount by which the carrying amount exceeds its fair value. |
Self-funded health insurance | Self-funded health insuranceThe Company’s health insurance plan is partially self-funded. To reduce its risk related to high-dollar claims, the Company maintains individual and aggregate stop-loss insurance. The Company estimates its exposure for claims incurred but not yet paid at the end of each reporting period and uses historical claims data to estimate its self-insurance liability. |
Advertising expenses | Advertising expensesAdvertising and marketing costs are expensed as incurred, and are included in sales and marketing expense in the consolidated statements of operations. |
Share-based compensation | Share-based compensation The Company measures and recognizes compensation expense for all share-based awards granted to employees and directors, based on the estimated fair value of the award on the date of grant. We use the Black-Scholes option pricing model to measure the fair value of stock option awards and shares granted under our ESPP. The fair value of restricted stock units (“RSUs”) is measured using the closing market price of the Company’s common stock on the date of the grant. The Company uses the Monte Carlo simulation technique to calculate the fair value of market-based awards, which include our performance share units (“PSUs”). |
Income taxes | Income taxes Income taxes are accounted for using the asset and liability method. Under this method, the Company recognizes deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts and the tax basis of assets and liabilities. Deferred tax assets and liabilities are measured using the enacted tax rates expected to apply to taxable income in the years in which the temporary differences are expected to be recovered or settled. The Company records a valuation allowance to reduce deferred tax assets to an amount for which realization is more likely than not. |
Concentrations of risk and significant customers | Concentrations of risk and significant customers Financial instruments that potentially subject the Company to concentrations of credit risk are primarily cash, cash equivalents, short-term investments, and accounts receivable. The Company maintains its cash accounts with financial institutions where deposits, at times, exceed the Federal Deposit Insurance Corporation (“FDIC”) limits. |
Net loss per share | Net loss per shareThe Company calculates basic net loss per share by dividing net loss by the weighted-average number of the Company’s common stock shares outstanding during the respective period. For periods where we report net income, the Company will use the treasury stock method to calculate diluted net income per share by adjusting basic net income per share for the potential dilutive impacts of outstanding stock options, RSUs, PSUs, and shares issuable pursuant to our ESPP. Since we have reported a net loss for all periods presented, all potentially dilutive shares are antidilutive and therefore no adjustment to the denominator is made. Diluted net loss per share and basic net loss per share are the same number for all periods presented. |
Foreign currency translation | Foreign currency translationThe functional currency of the Company’s foreign operations is primarily the U.S. dollar, while a few of our wholly owned subsidiaries use their respective local currency as their functional currency. We present our consolidated financial statements in U.S. dollar. For subsidiaries where the functional currency is a foreign currency, the Company translates the foreign currency financial statements to U.S. dollar using the exchange rates at the balance sheet date for assets and liabilities, the period average exchange rates for revenues and expenses, and the historical exchange rates for equity. The effects of foreign currency translation adjustments are recorded in accumulated other comprehensive income as a component of shareholders’ equity in the consolidated balance sheets and the related periodic movements are presented in the consolidated statements of comprehensive loss. Foreign currency transaction gains and losses are included in other income (expense), net, in the consolidated statements of operations for the period. |
Recently adopted accounting pronouncements | Recently adopted accounting pronouncements In October 2021, the Financial Accounting Standards Board issued Accounting Standards Update 2021-08, Business Combinations- Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (Topic 805) . The new guidance requires contract assets and contract liabilities acquired in a business combination to be recognized in accordance with Accounting Standards Codification (“ASC”) Topic 606 as if the acquirer had originated the contracts. The standard is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Early adoption was permitted. The Company adopted this standard effective August 1, 2022. The adoption of this standard did not have a material effect on the Company’s consolidated financial statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Jan. 31, 2023 | |
Accounting Policies [Abstract] | |
Schedule of Allowance for Doubtful Accounts | Activity related to the Company’s allowance for doubtful accounts was as follows (in thousands): January 31, 2023 2022 2021 Beginning balance $ 7,561 $ 6,933 $ 2,989 Additions 5,440 7,700 6,540 Write-offs (6,716) (7,072) (2,596) Ending balance $ 6,285 $ 7,561 $ 6,933 |
Schedule of Cash and Cash Equivalents | Cash as reported on the consolidated statements of cash flows consists of the following (in thousands): January 31, 2023 2022 2021 Cash and cash equivalents $ 223,156 $ 449,074 $ 442,200 Restricted cash included in prepaid expenses and other current assets 404 589 130 Restricted cash 197 17 18 Total cash, cash equivalents, and restricted cash shown in the consolidated statements of cash flows $ 223,757 $ 449,680 $ 442,348 |
Schedule of Restricted Cash and Cash Equivalents | Cash as reported on the consolidated statements of cash flows consists of the following (in thousands): January 31, 2023 2022 2021 Cash and cash equivalents $ 223,156 $ 449,074 $ 442,200 Restricted cash included in prepaid expenses and other current assets 404 589 130 Restricted cash 197 17 18 Total cash, cash equivalents, and restricted cash shown in the consolidated statements of cash flows $ 223,757 $ 449,680 $ 442,348 |
Schedule of Property and Equipment, Useful Lives | Depreciation is computed using the straight-line method over the following estimated useful lives: Computer equipment 3 years Computer software 3 years Furniture and fixtures 5-7 years Property and equipment, net consists of the following (in thousands): January 31, 2023 2022 Computer equipment $ 12,954 $ 13,728 Computer software, purchased and developed 33,260 27,663 Furniture and fixtures 6,526 9,082 Leasehold improvements 9,612 9,969 Total property and equipment 62,352 60,442 Less: accumulated depreciation (22,957) (23,607) Total property and equipment, net $ 39,395 $ 36,835 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 12 Months Ended |
Jan. 31, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following table presents calculations for basic and diluted net loss per share (in thousands, except per share data): Year Ended January 31, 2023 2022 2021 Numerator: Net loss $ (215,639) $ (171,097) $ (114,979) Denominator: Weighted-average shares outstanding 130,071 125,632 120,663 Net loss per share, basic and diluted $ (1.66) $ (1.36) $ (0.95) |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The following outstanding shares of common stock equivalents as of the periods presented were excluded from the computation of diluted net loss per share for the periods presented because the impact of including them would have been anti-dilutive (in thousands): Year Ended January 31, 2023 2022 2021 Shares subject to outstanding common stock awards 15,045 11,855 11,299 Shares issuable pursuant to the 2018 Employee Stock Purchase Plan 386 52 162 Total potentially dilutive shares 15,431 11,907 11,461 |
Investments (Tables)
Investments (Tables) | 12 Months Ended |
Jan. 31, 2023 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of Unrealized Gains and Losses, and Estimated Fair Values of the Company’s Investments | The following table presents the amortized costs, unrealized gains and losses, and estimated fair values of the Company’s cash equivalents and short-term investments as of January 31, 2023 (in thousands): January 31, 2023 Description Amortized Cost* Unrealized Gains Unrealized Losses Estimated Fair Value Cash equivalents: Money market funds $ 137,490 $ — $ — $ 137,490 Agency securities 3,497 — — 3,497 Total cash equivalents 140,987 — — 140,987 Short-term investments: Corporate bonds 66,051 46 (79) 66,018 U.S. Treasury securities 62,520 2 (144) 62,378 Commercial paper 78,454 — — 78,454 Agency securities 26,369 12 (6) 26,375 Total short-term investments 233,394 60 (229) 233,225 Total $ 374,381 $ 60 $ (229) $ 374,212 *Excludes interest receivable of $1.1 million, which is included in Prepaid expenses and other current assets |
Schedule of Maturities of the Company’s Short-term Investments | The following table presents the contractual maturities of the Company’s short-term investments as of January 31, 2023 (in thousands): January 31, 2023 Amortized Cost Estimated Fair Value Due within one year $ 207,487 $ 207,325 Due between one to five years 25,907 25,900 Total $ 233,394 $ 233,225 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Jan. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The following tables present information about the Company’s financial assets and liabilities that are measured at fair value and indicates the fair value hierarchy of the valuation inputs used (in thousands): January 31, 2023 Level 1 Level 2 Level 3 Total Assets Cash equivalents: Money market funds $ 137,490 $ — $ — $ 137,490 Agency securities 3,497 3,497 Total cash equivalents 137,490 3,497 — 140,987 Short-term investments: Corporate bonds — 66,018 — 66,018 U.S. Treasury securities — 62,378 — 62,378 Commercial paper — 78,454 — 78,454 Agency securities — 26,375 — 26,375 Total short-term investments — 233,225 — 233,225 Total assets $ 137,490 $ 236,722 $ — $ 374,212 January 31, 2022 Level 1 Level 2 Level 3 Total Assets Cash equivalents: Money market funds $ 378,294 $ — $ — $ 378,294 Total assets $ 378,294 $ — $ — $ 378,294 |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 12 Months Ended |
Jan. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Depreciation is computed using the straight-line method over the following estimated useful lives: Computer equipment 3 years Computer software 3 years Furniture and fixtures 5-7 years Property and equipment, net consists of the following (in thousands): January 31, 2023 2022 Computer equipment $ 12,954 $ 13,728 Computer software, purchased and developed 33,260 27,663 Furniture and fixtures 6,526 9,082 Leasehold improvements 9,612 9,969 Total property and equipment 62,352 60,442 Less: accumulated depreciation (22,957) (23,607) Total property and equipment, net $ 39,395 $ 36,835 |
Business Combinations (Tables)
Business Combinations (Tables) | 12 Months Ended |
Jan. 31, 2023 | |
Business Combinations [Abstract] | |
Schedule of Assets Acquired and Liabilities Assumed | The following table summarizes the preliminary fair values of assets acquired and liabilities assumed as of the date of acquisition (in thousands): September 1, 2022 Cash and restricted cash $ 266 Intangible assets 5,190 Goodwill 16,434 Other net tangible assets and liabilities assumed (1,283) Total $ 20,607 September 14, 2020 Cash $ 2,530 Accounts receivable 2,649 Contract assets 1,620 Right-of-use assets 895 Other assets 991 Intangible assets 45,270 Goodwill 109,108 Accounts payable, accrued expenses, and other current liabilities (1,411) Deferred revenue (4,655) Lease liabilities, non-current (522) Net deferred tax liability (4,014) Total $ 152,461 |
Schedule of Finite-Lived Intangible Assets Acquired as Part of Business Combination | The estimated useful lives and fair values of the identifiable intangible assets at acquisition date were as follows (dollars in thousands): Fair Value Expected Useful Life Discount Rate Software technology $ 3,200 5 years 14.7 % Customer relationships 1,990 7 years 14.7 % Total intangible assets $ 5,190 The estimated useful lives and fair values of the identifiable intangible assets at acquisition date were as follows (dollars in thousands): Fair Value Expected Useful Life Discount Rate Software technology $ 17,400 5 years 10.0 % Customer relationships 16,590 7 years 11.0 % Customer relationships - reseller 7,280 7 years 13.0 % Trade name 4,000 9 years 13.8 % Total intangible assets $ 45,270 |
Schedule of Business Acquisitions, by Acquisition | The acquisition date fair value of the consideration transferred for Brandfolder was approximately $152.5 million, which consisted of the following (in thousands): Fair Value Cash $ 126,589 Class A Common Stock 25,872 Total $ 152,461 |
Business Acquisition, Pro Forma Information | The amounts of revenue and earnings of Brandfolder included in the Company’s consolidated statements of operations from the acquisition date of September 14, 2020 to January 31, 2021 are as follows (in thousands): January 31, 2021 Revenue $ 5,683 Loss before income tax benefit (4,758) The following unaudited pro forma financial information is for illustrative purposes only and summarizes the combined results of operations for Smartsheet Inc. and Brandfolder, as though the companies were combined as of the beginning of the Company’s fiscal year 2020. The unaudited pro forma financial information was as follows (in thousands): January 31, 2021 2020 Revenue $ 397,160 $ 278,200 Loss before income tax provision (benefit) (122,148) (112,351) Net loss (122,410) (107,374) |
Goodwill and Net Intangible A_2
Goodwill and Net Intangible Assets (Tables) | 12 Months Ended |
Jan. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The changes in the carrying amount of goodwill during the years ended January 31, 2023 and 2022 were as follows (in thousands): Goodwill balance as of January 31, 2021 $ 125,605 Additions and measurement period adjustments — Goodwill balance as of January 31, 2022 125,605 Additions and measurement period adjustments - acquisition of Outfit 16,434 Effects of foreign currency translation 376 Goodwill balance as of January 31, 2023 $ 142,415 |
Schedule of Finite-Lived Intangible Assets | The following table presents the components of net intangible assets (in thousands): As of January 31, 2023 As of January 31, 2022 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Acquired software technology $ 28,673 $ (14,547) $ 14,126 $ 25,400 $ (9,195) $ 16,205 Acquired customer relationships 34,186 (12,265) 21,921 32,150 (7,735) 24,415 Trade names 4,100 (1,157) 2,943 4,100 (711) 3,389 Patents 170 (135) 35 170 (127) 43 Domain name 44 — 44 44 — 44 Total $ 67,173 $ (28,104) $ 39,069 $ 61,864 $ (17,768) $ 44,096 The components of intangible assets acquired as of the periods presented were as follows (dollars in thousands): As of January 31, 2023 As of January 31, 2022 Net Carrying Amount Weighted Average Life (Years) Net Carrying Amount Weighted Average Life (Years) Acquired software technology $ 14,126 2.8 $ 16,205 3.3 Acquired customer relationships 21,921 4.7 24,415 5.5 Trade names 2,943 6.6 3,389 7.6 Total $ 38,990 4.2 $ 44,009 4.9 |
Schedule of Estimated Remaining Amortization Expense for Intangible Assets | As of January 31, 2023, estimated remaining amortization expense for the finite-lived intangible assets by fiscal year is as follows (in thousands): 2024 $ 10,887 2025 9,686 2026 7,969 2027 5,803 2028 3,491 Thereafter 1,189 Total $ 39,025 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 12 Months Ended |
Jan. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Stock Option Activity | The following table includes a summary of the option activity during the year ended January 31, 2023: Options Outstanding Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term (years) Aggregate Intrinsic Value (in thousands) Outstanding at January 31, 2022 4,573,482 $ 20.87 6.2 $ 192,982 Granted 253,049 36.34 Exercised (859,115) 9.46 Forfeited or canceled (148,128) 47.80 Outstanding at January 31, 2023 3,819,288 23.42 5.7 90,985 Exercisable at January 31, 2023 3,050,682 15.72 4.9 88,960 Vested and expected to vest at January 31, 2023 3,701,994 22.44 5.6 90,641 |
Schedule of Restricted Stock Units Award Activity | The following table includes a summary of the RSU activity during the year ended January 31, 2023: Number of Shares Underlying Outstanding RSUs Weighted-Average Grant-Date Fair Value per RSU Outstanding at January 31, 2022 7,281,232 $ 60.95 Granted 7,965,718 39.16 Vested (2,813,339) 57.03 Forfeited or canceled (1,458,454) 57.82 Outstanding at January 31, 2023 10,975,157 46.56 |
Schedule of Performance Share Units Activity | The following table includes a summary of the PSU activity during the year ended January 31, 2023: Number of Shares Weighted-Average Grant-Date Fair Value per Share Outstanding at January 31, 2022 — $ — Granted 251,027 53.34 Vested — — Forfeited or canceled — — Outstanding at January 31, 2023 251,027 53.34 |
Nonvested Restricted Stock Shares Activity | The following table includes a summary of RSA activity during the year ended January 31, 2023: Number of Shares Weighted-Average Grant-Date Fair Value per Share Outstanding at January 31, 2022 56,288 $ 46.93 Granted — — Vested (28,144) 46.93 Forfeited or canceled (8,249) 46.93 Outstanding at January 31, 2023 19,895 46.93 |
Schedule of Shares Available for Issuance Under ESPP | The following table includes a summary of the activity of shares available for issuance under our 2018 Plan and our ESPP during the year ended January 31, 2023: Shares Available for Issuance 2018 Plan 2018 ESPP Balance at January 31, 2022 15,067,025 4,040,430 Authorized 6,390,477 1,278,096 Granted (8,469,794) (467,751) Forfeited 1,606,582 — Balance at January 31, 2023 14,594,290 4,850,775 |
Schedule of Fair Value Assumptions, Stock Options | The fair value of employee stock options and ESPP purchase rights was estimated using a Black-Scholes option pricing model. The fair value of the PSUs was estimated using a Monte Carlo simulation valuation model. The fair values of the Company’s stock options, ESPP purchase rights, and PSUs granted during the years ended January 31, 2023, 2022, and 2021 were estimated using the following assumptions: Year Ended January 31, 2023 2022 2021 Employee Stock Options Risk-free interest rate 1.8%-3.7% 1.0%-1.4% 0.6%-0.7% Expected volatility 44.2%-46.3% 43.1%-43.5% 43.0%-43.5% Expected term (in years) 6.25 6.25 6.25 Expected dividend yield — % — % — % Employee Stock Purchase Plan Risk-free interest rate 0.2%-2.5% 0.0%-0.1% 0.1%-1.9% Expected volatility 50.0%-72.8% 46.9%-68.0% 39.9%-68.0% Expected term (in years) 0.50 0.27-0.50 0.50 Expected dividend yield — % — % — % Performance Share Units Risk-free interest rate 4.3 % — — Expected volatility 52.5 % — — Expected volatility (S&P Software and Services Select Index) 31.8 % — — Expected term (in years) 1.00-2.00 — — Expected dividend yield — % — — |
Schedule of Fair Value Assumptions, ESPP | The fair value of employee stock options and ESPP purchase rights was estimated using a Black-Scholes option pricing model. The fair value of the PSUs was estimated using a Monte Carlo simulation valuation model. The fair values of the Company’s stock options, ESPP purchase rights, and PSUs granted during the years ended January 31, 2023, 2022, and 2021 were estimated using the following assumptions: Year Ended January 31, 2023 2022 2021 Employee Stock Options Risk-free interest rate 1.8%-3.7% 1.0%-1.4% 0.6%-0.7% Expected volatility 44.2%-46.3% 43.1%-43.5% 43.0%-43.5% Expected term (in years) 6.25 6.25 6.25 Expected dividend yield — % — % — % Employee Stock Purchase Plan Risk-free interest rate 0.2%-2.5% 0.0%-0.1% 0.1%-1.9% Expected volatility 50.0%-72.8% 46.9%-68.0% 39.9%-68.0% Expected term (in years) 0.50 0.27-0.50 0.50 Expected dividend yield — % — % — % Performance Share Units Risk-free interest rate 4.3 % — — Expected volatility 52.5 % — — Expected volatility (S&P Software and Services Select Index) 31.8 % — — Expected term (in years) 1.00-2.00 — — Expected dividend yield — % — — |
Schedule of Share-based Compensation Expense | Share-based compensation expense included in the consolidated statements of operations was as follows (in thousands): Year Ended January 31, 2023 2022 2021 Cost of subscription revenue $ 11,248 $ 6,274 $ 4,385 Cost of professional services revenue 6,404 3,788 2,146 Research and development 62,165 41,218 25,072 Sales and marketing 63,224 40,632 25,921 General and administrative 33,514 22,988 14,498 Total share-based compensation $ 176,555 $ 114,900 $ 72,022 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Jan. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income before Income Tax, Domestic and Foreign | The components of loss before income tax provision (benefit) were as follows (in thousands): Year Ended January 31, 2023 2022 2021 United States $ (216,167) $ (174,043) $ (120,958) Foreign 3,377 3,242 2,226 Loss before income tax provision (benefit) $ (212,790) $ (170,801) $ (118,732) The income tax provision (benefit) consisted of the following (in thousands): Year Ended January 31, 2023 2022 2021 Current: Federal $ 876 $ — $ — State 1,239 175 115 Foreign 1,085 49 63 Total current tax provision (benefit) 3,200 224 178 Deferred and other: Federal — — (3,117) State — — (898) Foreign (351) 72 84 Total deferred tax provision (benefit) (351) 72 (3,931) Total income tax provision (benefit) $ 2,849 $ 296 $ (3,753) |
Schedule of Effective Income Tax Rate Reconciliation | The reconciliation of federal statutory income tax to the Company’s provision for income taxes is as follows (in thousands): Year Ended January 31, 2023 2022 2021 Income tax at statutory federal rate $ (44,686) $ (35,868) $ (24,934) Tax credits (7,660) (5,697) (5,657) Change in valuation allowance 44,898 71,738 51,296 Share-based compensation 7,558 (30,092) (24,057) Global intangible low taxed income inclusion 2,276 — — Other 463 215 (401) Total income tax provision (benefit) $ 2,849 $ 296 $ (3,753) |
Schedule of Deferred Tax Assets and Liabilities | The tax effects of temporary differences and related deferred tax assets and liabilities as of January 31, 2023 and 2022 were as follows (in thousands): January 31, 2023 2022 Deferred tax assets: Net operating loss carryforwards $ 121,171 $ 147,348 Deferred revenue 117,579 82,904 Capitalized research & experimental expenditures 45,906 — Tax credits 29,267 23,677 Lease liabilities 17,273 19,379 Share-based compensation 17,282 16,595 Accrued compensation 8,983 5,711 Other 982 1,097 Total deferred tax assets 358,443 296,711 Valuation allowance (302,196) (247,130) Total deferred tax assets, net 56,247 49,581 Deferred tax liabilities: Capitalized commissions (30,836) (23,242) Lease right-of-use assets (14,320) (17,023) Intangibles (7,637) (8,265) Property and equipment (2,250) (1,186) Other (989) — Total deferred tax liabilities (56,032) (49,716) Net deferred tax assets (liabilities) $ 215 $ (135) |
Reconciliation of Amounts of Unrecognized Tax Benefits | The following is a tabular reconciliation of the total amounts of unrecognized tax benefits: Year Ended January 31, 2023 2022 2021 Balance, beginning of the year $ 7,204 $ 5,283 $ 3,339 Increases to tax positions taken during the current year 2,218 2,010 2,046 Increases to tax positions taken in prior years 461 — 11 Decreases to tax positions taken in prior years (89) (113) Balance, end of year $ 9,883 $ 7,204 $ 5,283 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Jan. 31, 2023 | |
Leases [Abstract] | |
Components of Lease Expense | The components of lease expense recorded in the consolidated statements of operations were as follows (in thousands): Year Ended January 31, 2023 2022 2021 Operating lease cost $ 22,508 $ 18,739 $ 15,586 Finance lease cost: Amortization of assets — — 3,093 Interest on lease liabilities — — 114 Short-term lease cost 950 371 1,493 Variable lease cost 2,833 2,850 2,606 Sublease income (527) — — Total lease costs $ 25,764 $ 21,960 $ 22,892 Other information related to leases was as follows (in thousands): Year Ended January 31, 2023 2022 2021 Supplemental cash flow information: Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows related to operating leases* $ 19,735 $ 17,610 $ 14,249 Operating cash flows related to finance leases — — 114 Financing cash flows related to finance leases — — 4,129 Right-of-use assets obtained in exchange for new operating lease liabilities 7,230 994 35,415 Right-of-use assets reductions related to operating leases 4,696 — — Supplemental balance sheet information related to our operating leases was as follows: January 31, 2023 2022 Weighted-average remaining lease term (in years) 4.5 5.3 Weighted-average discount rate 5.3 % 5.0 % |
Schedule of Future Minimum Rental Payments for Operating Leases | As of January 31, 2023, the reconciliation of the undiscounted cash flows to the total operating lease liabilities were as follows (in thousands): Operating Leases Fiscal 2024 $ 19,683 Fiscal 2025 17,029 Fiscal 2026 14,577 Fiscal 2027 10,868 Fiscal 2028 6,078 Thereafter 6,235 Total payments 74,470 Less: imputed interest (7,686) Total operating lease liabilities $ 66,784 As of January 31, 2023, the future total minimum sublease payments to be received were as follows (in thousands): Sublease Receipts Fiscal 2024 $ 1,495 Fiscal 2025 1,592 Fiscal 2026 1,645 Fiscal 2027 700 Thereafter — Total $ 5,432 |
Commitment and Contingencies (T
Commitment and Contingencies (Tables) | 12 Months Ended |
Jan. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Other Commitments | We have entered into certain non-cancelable multi-year agreements with third-party providers primarily for our use of cloud-based hosting services. As of January 31, 2023, our future estimated purchase commitments related to these contracts by fiscal year are as follows (in thousands): Fiscal 2024 $ 49,390 Fiscal 2025 64,350 Fiscal 2026 46,366 Fiscal 2027 — Fiscal 2028 — Thereafter — Total $ 160,106 |
Geographic Information (Tables)
Geographic Information (Tables) | 12 Months Ended |
Jan. 31, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Revenue by Geographical Area | Revenue by geographic location is determined by the location of the Company’s customers. The following table sets forth revenue by geographic area (in thousands): Year Ended January 31, 2023 2022 2021 United States $ 640,604 $ 454,246 $ 314,177 EMEA 65,574 51,603 37,463 Asia Pacific 29,946 21,326 15,325 Americas other than the United States 30,791 23,657 18,548 Total $ 766,915 $ 550,832 $ 385,513 |
Long-lived Assets by Geographic Areas | The following table sets forth long-lived assets by geographic area (in thousands): January 31, 2023 2022 United States $ 60,246 $ 79,278 EMEA 5,583 3,828 Asia Pacific 4,510 1,153 Americas other than the United States 274 28 Total $ 70,613 $ 84,287 |
Overview and Basis of Present_2
Overview and Basis of Presentation (Details) - USD ($) $ / shares in Units, $ in Thousands | 6 Months Ended | 12 Months Ended | |||
Jul. 31, 2022 | Jan. 31, 2023 | Jan. 31, 2023 | Jan. 31, 2022 | Jan. 31, 2021 | |
Change in Accounting Estimate [Line Items] | |||||
Deferred commissions amortized period | 3 years | 4 years | 4 years | ||
Net loss per share, basic and diluted (in dollars per share) | $ (1.66) | $ (1.36) | $ (0.95) | ||
Diluted net loss per share (in dollars per share) | $ (1.66) | $ (1.36) | $ (0.95) | ||
Accumulated deficit | $ 758,173 | $ 758,173 | $ 542,534 | ||
Deferred Commissions, Amortization Period | |||||
Change in Accounting Estimate [Line Items] | |||||
Percentage of total revenue | 2% | ||||
Net loss per share, basic and diluted (in dollars per share) | $ 0.09 | ||||
Diluted net loss per share (in dollars per share) | $ 0.09 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Narrative (Details) $ in Millions | 6 Months Ended | 12 Months Ended | |||
Jul. 31, 2022 | Jan. 31, 2023 USD ($) | Jan. 31, 2023 USD ($) segment | Jan. 31, 2022 USD ($) | Jan. 31, 2021 USD ($) | |
Lessee, Lease, Description [Line Items] | |||||
Number of operating segments | segment | 1 | ||||
Payment period | 30 days | ||||
Deferred commissions amortized period | 3 years | 4 years | 4 years | ||
Restricted cash | $ 0.6 | $ 0.6 | $ 0.6 | $ 0.1 | |
Internal use software costs capitalized | 11 | 8.6 | |||
Amortization expense of capitalized internal-use software costs | 7.7 | 5.7 | 3.6 | ||
Impairment charges | 1.5 | ||||
Net self insurance reserve estimate | $ 2.3 | 2.3 | |||
Advertising and marketing expenses | $ 77.9 | $ 55.6 | $ 31.6 | ||
Software | |||||
Lessee, Lease, Description [Line Items] | |||||
Software useful life | 3 years |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Schedule of Provision for Doubtful Accounts (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 31, 2023 | Jan. 31, 2022 | Jan. 31, 2021 | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | |||
Beginning balance | $ 7,561 | $ 6,933 | $ 2,989 |
Additions | 5,440 | 7,700 | 6,540 |
Write-offs | (6,716) | (7,072) | (2,596) |
Ending balance | $ 6,285 | $ 7,561 | $ 6,933 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Schedule of Cash and Cash Equivalents (Details) - USD ($) $ in Thousands | Jan. 31, 2023 | Jan. 31, 2022 | Jan. 31, 2021 | Jan. 31, 2020 |
Accounting Policies [Abstract] | ||||
Cash and cash equivalents | $ 223,156 | $ 449,074 | $ 442,200 | |
Restricted cash included in prepaid expenses and other current assets | 404 | 589 | 130 | |
Restricted cash | 197 | 17 | 18 | |
Total cash, cash equivalents, and restricted cash shown in the consolidated statements of cash flows | $ 223,757 | $ 449,680 | $ 442,348 | $ 516,789 |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Schedule of Useful Lives (Details) | 12 Months Ended |
Jan. 31, 2023 | |
Computer equipment | |
Property, Plant and Equipment [Line Items] | |
Useful lives | 3 years |
Computer software | |
Property, Plant and Equipment [Line Items] | |
Useful lives | 3 years |
Furniture and fixtures | Minimum | |
Property, Plant and Equipment [Line Items] | |
Useful lives | 5 years |
Furniture and fixtures | Maximum | |
Property, Plant and Equipment [Line Items] | |
Useful lives | 7 years |
Revenue from Contracts with C_2
Revenue from Contracts with Customers - Deferred Revenue (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jan. 31, 2023 | Jan. 31, 2022 | Jan. 31, 2021 | |
Revenue from External Customer [Line Items] | |||
Deferred revenue | $ 528.9 | ||
Subscription | |||
Revenue from External Customer [Line Items] | |||
Revenue recognized included in deferred revenue | 328.1 | $ 216.6 | $ 155.2 |
Deferred revenue | 520.5 | ||
Professional services | |||
Revenue from External Customer [Line Items] | |||
Revenue recognized included in deferred revenue | 4.7 | $ 4.8 | $ 3.4 |
Deferred revenue | $ 8.4 |
Revenue from Contracts with C_3
Revenue from Contracts with Customers - Revenue Recognition (Details) - Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-02-01 | Jan. 31, 2023 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Percentage of revenue related to remaining performance obligations | 92% |
Period of expected timing of satisfaction related to remaining performance obligations | 12 months |
Deferred Commissions (Details)
Deferred Commissions (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Jan. 31, 2023 | Jan. 31, 2022 | Jan. 31, 2021 | Aug. 01, 2022 | Jul. 31, 2022 | |
Revenue Recognition and Deferred Revenue [Abstract] | |||||
Deferred commissions | $ 121,785 | $ 91,312 | |||
Amortization of deferred commission costs | 47,093 | 43,680 | $ 30,691 | ||
Deferred commissions amortization period | 4 years | 3 years | |||
Impairment charges | $ 0 | $ 0 | $ 0 |
Net Loss Per Share - Schedule o
Net Loss Per Share - Schedule of Earnings Per Share, Basic and Diluted (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Jan. 31, 2023 | Jan. 31, 2022 | Jan. 31, 2021 | |
Numerator: | |||
Net loss | $ (215,639) | $ (171,097) | $ (114,979) |
Denominator: | |||
Weighted-average basic shares outstanding (in shares) | 130,071 | 125,632 | 120,663 |
Weighted-average diluted shares outstanding (in shares) | 130,071 | 125,632 | 120,663 |
Basic net loss per share (in usd per share) | $ (1.66) | $ (1.36) | $ (0.95) |
Diluted net loss per share (in dollars per share) | $ (1.66) | $ (1.36) | $ (0.95) |
Net Loss Per Share - Schedule_2
Net Loss Per Share - Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share (Details) - shares shares in Thousands | 12 Months Ended | ||
Jan. 31, 2023 | Jan. 31, 2022 | Jan. 31, 2021 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Total potentially dilutive shares | 15,431 | 11,907 | 11,461 |
Shares subject to outstanding common stock awards | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Total potentially dilutive shares | 15,045 | 11,855 | 11,299 |
Shares issuable pursuant to the 2018 Employee Stock Purchase Plan | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Total potentially dilutive shares | 386 | 52 | 162 |
Investments - Schedule of Unrea
Investments - Schedule of Unrealized Gains and Losses, and Estimated Fair Values of the Company’s Investments (Details) $ in Thousands | Jan. 31, 2023 USD ($) |
Debt and Equity Securities, FV-NI [Line Items] | |
Amortized Cost | $ 374,381 |
Unrealized Gains | 60 |
Unrealized Losses | (229) |
Estimated Fair Value | 374,212 |
Interest receivable | $ 1,100 |
Debt Securities, Available-for-Sale, Accrued Interest, after Allowance for Credit Loss, Statement of Financial Position [Extensible Enumeration] | Prepaid expenses and other current assets |
Money market funds | |
Debt and Equity Securities, FV-NI [Line Items] | |
Amortized Cost | $ 137,490 |
Unrealized Gains | 0 |
Unrealized Losses | 0 |
Estimated Fair Value | 137,490 |
Agency securities | |
Debt and Equity Securities, FV-NI [Line Items] | |
Amortized Cost | 3,497 |
Unrealized Gains | 0 |
Unrealized Losses | 0 |
Estimated Fair Value | 3,497 |
Total cash equivalents | |
Debt and Equity Securities, FV-NI [Line Items] | |
Amortized Cost | 140,987 |
Unrealized Gains | 0 |
Unrealized Losses | 0 |
Estimated Fair Value | 140,987 |
Corporate bonds | |
Debt and Equity Securities, FV-NI [Line Items] | |
Amortized Cost | 66,051 |
Unrealized Gains | 46 |
Unrealized Losses | (79) |
Estimated Fair Value | 66,018 |
U.S. Treasury securities | |
Debt and Equity Securities, FV-NI [Line Items] | |
Amortized Cost | 62,520 |
Unrealized Gains | 2 |
Unrealized Losses | (144) |
Estimated Fair Value | 62,378 |
Commercial paper | |
Debt and Equity Securities, FV-NI [Line Items] | |
Amortized Cost | 78,454 |
Unrealized Gains | 0 |
Unrealized Losses | 0 |
Estimated Fair Value | 78,454 |
Agency securities | |
Debt and Equity Securities, FV-NI [Line Items] | |
Amortized Cost | 26,369 |
Unrealized Gains | 12 |
Unrealized Losses | (6) |
Estimated Fair Value | 26,375 |
Total short-term investments | |
Debt and Equity Securities, FV-NI [Line Items] | |
Amortized Cost | 233,394 |
Unrealized Gains | 60 |
Unrealized Losses | (229) |
Estimated Fair Value | $ 233,225 |
Investments - Schedule of Matur
Investments - Schedule of Maturities of the Company’s Short-term Investments (Details) $ in Thousands | Jan. 31, 2023 USD ($) |
Amortized Cost | |
Amortized Cost | $ 374,381 |
Estimated Fair Value | |
Estimated Fair Value | 374,212 |
Total short-term investments | |
Amortized Cost | |
Due within one year | 207,487 |
Due between one to five years | 25,907 |
Amortized Cost | 233,394 |
Estimated Fair Value | |
Due within one year | 207,325 |
Due between one to five years | 25,900 |
Estimated Fair Value | $ 233,225 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis (Details) - Fair value, measurements, recurring - USD ($) $ in Thousands | Jan. 31, 2023 | Jan. 31, 2022 |
Cash equivalents: | ||
Cash equivalents: | $ 140,987 | |
Short-term investments: | ||
Available-for-sale securities | 233,225 | |
Total assets | 374,212 | $ 378,294 |
Corporate bonds | ||
Short-term investments: | ||
Available-for-sale securities | 66,018 | |
U.S. Treasury securities | ||
Short-term investments: | ||
Available-for-sale securities | 62,378 | |
Commercial paper | ||
Short-term investments: | ||
Available-for-sale securities | 78,454 | |
Agency securities | ||
Short-term investments: | ||
Available-for-sale securities | 26,375 | |
Level 1 | ||
Cash equivalents: | ||
Cash equivalents: | 137,490 | |
Short-term investments: | ||
Available-for-sale securities | 0 | |
Total assets | 137,490 | 378,294 |
Level 1 | Corporate bonds | ||
Short-term investments: | ||
Available-for-sale securities | 0 | |
Level 1 | U.S. Treasury securities | ||
Short-term investments: | ||
Available-for-sale securities | 0 | |
Level 1 | Commercial paper | ||
Short-term investments: | ||
Available-for-sale securities | 0 | |
Level 1 | Agency securities | ||
Short-term investments: | ||
Available-for-sale securities | 0 | |
Level 2 | ||
Cash equivalents: | ||
Cash equivalents: | 3,497 | |
Short-term investments: | ||
Available-for-sale securities | 233,225 | |
Total assets | 236,722 | 0 |
Level 2 | Corporate bonds | ||
Short-term investments: | ||
Available-for-sale securities | 66,018 | |
Level 2 | U.S. Treasury securities | ||
Short-term investments: | ||
Available-for-sale securities | 62,378 | |
Level 2 | Commercial paper | ||
Short-term investments: | ||
Available-for-sale securities | 78,454 | |
Level 2 | Agency securities | ||
Short-term investments: | ||
Available-for-sale securities | 26,375 | |
Level 3 | ||
Cash equivalents: | ||
Cash equivalents: | 0 | |
Short-term investments: | ||
Available-for-sale securities | 0 | |
Total assets | 0 | 0 |
Level 3 | Corporate bonds | ||
Short-term investments: | ||
Available-for-sale securities | 0 | |
Level 3 | U.S. Treasury securities | ||
Short-term investments: | ||
Available-for-sale securities | 0 | |
Level 3 | Commercial paper | ||
Short-term investments: | ||
Available-for-sale securities | 0 | |
Level 3 | Agency securities | ||
Short-term investments: | ||
Available-for-sale securities | 0 | |
Money market funds | ||
Cash equivalents: | ||
Cash equivalents: | 137,490 | 378,294 |
Money market funds | Level 1 | ||
Cash equivalents: | ||
Cash equivalents: | 137,490 | 378,294 |
Money market funds | Level 2 | ||
Cash equivalents: | ||
Cash equivalents: | 0 | 0 |
Money market funds | Level 3 | ||
Cash equivalents: | ||
Cash equivalents: | 0 | $ 0 |
Agency securities | ||
Cash equivalents: | ||
Cash equivalents: | 3,497 | |
Agency securities | Level 1 | ||
Cash equivalents: | ||
Cash equivalents: | ||
Agency securities | Level 2 | ||
Cash equivalents: | ||
Cash equivalents: | 3,497 | |
Agency securities | Level 3 | ||
Cash equivalents: | ||
Cash equivalents: |
Property and Equipment, Net (De
Property and Equipment, Net (Details) - USD ($) $ in Thousands | Jan. 31, 2023 | Jan. 31, 2022 |
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $ 62,352 | $ 60,442 |
Less: accumulated depreciation | (22,957) | (23,607) |
Total property and equipment, net | 39,395 | 36,835 |
Computer equipment | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 12,954 | 13,728 |
Computer software, purchased and developed | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 33,260 | 27,663 |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 6,526 | 9,082 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $ 9,612 | $ 9,969 |
Property and Equipment, Net - N
Property and Equipment, Net - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jan. 31, 2023 | Jan. 31, 2022 | Jan. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation expense | $ 13.7 | $ 10.9 | $ 11 |
Business Combinations - Narrati
Business Combinations - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Sep. 01, 2022 | Sep. 14, 2020 | Jan. 31, 2023 | Jan. 31, 2022 | Jan. 31, 2021 | |
Business Acquisition [Line Items] | |||||
Share-based compensation | $ 176,555 | $ 114,900 | $ 72,022 | ||
Weighted-average amortization period of the acquired intangible assets | 4 years 2 months 12 days | 4 years 10 months 24 days | |||
On Brand Holdings Inc. | |||||
Business Acquisition [Line Items] | |||||
Percentage of outstanding equity acquired | 100% | ||||
Acquisition costs | $ 600 | ||||
Consideration transferred | $ 20,600 | ||||
Weighted average amortization period | 5 years 9 months 18 days | ||||
Brandfolder | |||||
Business Acquisition [Line Items] | |||||
Percentage of outstanding equity acquired | 100% | ||||
Consideration transferred | $ 152,461 | ||||
Acquisition costs incurred | $ 100 | 1,000 | |||
Consideration transferred, held in escrow | $ 700 | ||||
Weighted-average amortization period of the acquired intangible assets | 6 years 4 months 24 days | ||||
Cash | $ 126,589 | ||||
Brandfolder | Restricted stock award | Common Class A | |||||
Business Acquisition [Line Items] | |||||
Granted (in shares) | 96,620 | ||||
Aggregate grant date fair value | $ 4,500 | ||||
Share-based compensation | $ 1,200 | $ 1,500 | $ 500 |
Business Combinations - Assets
Business Combinations - Assets and Liabilities Acquired (Details) - USD ($) $ in Thousands | Jan. 31, 2023 | Sep. 01, 2022 | Jan. 31, 2022 | Jan. 31, 2021 | Sep. 14, 2020 |
Business Acquisition [Line Items] | |||||
Intangible assets | $ 38,990 | $ 44,009 | |||
Goodwill | $ 142,415 | $ 125,605 | $ 125,605 | ||
Brandfolder | |||||
Business Acquisition [Line Items] | |||||
Cash and restricted cash | $ 2,530 | ||||
Accounts receivable | 2,649 | ||||
Contract assets | 1,620 | ||||
Right-of-use assets | 895 | ||||
Other assets | 991 | ||||
Intangible assets | 45,270 | ||||
Goodwill | 109,108 | ||||
Accounts payable, accrued expenses, and other current liabilities | (1,411) | ||||
Deferred revenue | (4,655) | ||||
Lease liabilities, non-current | (522) | ||||
Net deferred tax liability | (4,014) | ||||
Total | $ 152,461 | ||||
On Brand Holdings Inc. | |||||
Business Acquisition [Line Items] | |||||
Cash and restricted cash | $ 266 | ||||
Intangible assets | 5,190 | ||||
Goodwill | 16,434 | ||||
Other net tangible assets and liabilities assumed | (1,283) | ||||
Total | $ 20,607 |
Business Combinations - Intangi
Business Combinations - Intangible Assets Acquired (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Sep. 01, 2022 | Sep. 14, 2020 | Jan. 31, 2023 | Jan. 31, 2022 | |
Business Acquisition [Line Items] | ||||
Expected Useful Life | 4 years 2 months 12 days | 4 years 10 months 24 days | ||
Software technology | ||||
Business Acquisition [Line Items] | ||||
Expected Useful Life | 2 years 9 months 18 days | 3 years 3 months 18 days | ||
Customer relationships | ||||
Business Acquisition [Line Items] | ||||
Expected Useful Life | 4 years 8 months 12 days | 5 years 6 months | ||
Trade names | ||||
Business Acquisition [Line Items] | ||||
Expected Useful Life | 6 years 7 months 6 days | 7 years 7 months 6 days | ||
On Brand Holdings Inc. | ||||
Business Acquisition [Line Items] | ||||
Fair Value | $ 5,190 | |||
Discount Rate | 14.70% | |||
On Brand Holdings Inc. | Software technology | ||||
Business Acquisition [Line Items] | ||||
Fair Value | $ 3,200 | |||
Expected Useful Life | 5 years | |||
On Brand Holdings Inc. | Customer relationships | ||||
Business Acquisition [Line Items] | ||||
Fair Value | $ 1,990 | |||
Expected Useful Life | 7 years | |||
Brandfolder | ||||
Business Acquisition [Line Items] | ||||
Fair Value | $ 45,270 | |||
Expected Useful Life | 6 years 4 months 24 days | |||
Brandfolder | Software technology | ||||
Business Acquisition [Line Items] | ||||
Fair Value | $ 17,400 | |||
Expected Useful Life | 5 years | |||
Discount Rate | 10% | |||
Brandfolder | Customer relationships | ||||
Business Acquisition [Line Items] | ||||
Fair Value | $ 16,590 | |||
Expected Useful Life | 7 years | |||
Discount Rate | 11% | |||
Brandfolder | Customer relationships - reseller | ||||
Business Acquisition [Line Items] | ||||
Fair Value | $ 7,280 | |||
Expected Useful Life | 7 years | |||
Discount Rate | 13% | |||
Brandfolder | Trade names | ||||
Business Acquisition [Line Items] | ||||
Fair Value | $ 4,000 | |||
Expected Useful Life | 9 years | |||
Discount Rate | 13.80% |
Business Combinations - Fair Va
Business Combinations - Fair Value of Consideration Transferred (Details) - Brandfolder $ in Thousands | Sep. 14, 2020 USD ($) |
Business Acquisition [Line Items] | |
Cash | $ 126,589 |
Class A Common Stock | 25,872 |
Total | $ 152,461 |
Business Combinations - Revenue
Business Combinations - Revenue and Earnings Included in Statements of Operations (Details) - Brandfolder $ in Thousands | 5 Months Ended |
Jan. 31, 2021 USD ($) | |
Business Acquisition [Line Items] | |
Revenue | $ 5,683 |
Loss before income tax benefit | $ (4,758) |
Business Combinations - Pro For
Business Combinations - Pro Forma Financial Information (Details) - Brandfolder - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 31, 2022 | Jan. 31, 2021 | |
Business Acquisition [Line Items] | ||
Revenue | $ 397,160 | $ 278,200 |
Loss before income tax provision (benefit) | (122,148) | (112,351) |
Net loss | $ (122,410) | $ (107,374) |
Goodwill and Net Intangible A_3
Goodwill and Net Intangible Assets - Changes in Carrying Amount of Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 31, 2023 | Jan. 31, 2022 | |
Goodwill [Roll Forward] | ||
Goodwill, beginning balance | $ 125,605 | $ 125,605 |
Additions and measurement period adjustments | 16,434 | 0 |
Effects of foreign currency translation | 376 | |
Goodwill, ending balance | $ 142,415 | $ 125,605 |
Goodwill and Net Intangible A_4
Goodwill and Net Intangible Assets - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jan. 31, 2023 | Jan. 31, 2022 | Jan. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Amortization expense | $ 10.3 | $ 10.1 | $ 6.3 |
Goodwill and Net Intangible A_5
Goodwill and Net Intangible Assets - Schedule of Finite-Lived Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 31, 2023 | Jan. 31, 2022 | |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 67,173 | $ 61,864 |
Accumulated Amortization | (28,104) | (17,768) |
Net Carrying Amount | 39,069 | 44,096 |
Net Carrying Amount | $ 38,990 | $ 44,009 |
Weighted Average Life (Years) | 4 years 2 months 12 days | 4 years 10 months 24 days |
Acquired software technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 28,673 | $ 25,400 |
Accumulated Amortization | (14,547) | (9,195) |
Net Carrying Amount | 14,126 | 16,205 |
Net Carrying Amount | $ 14,126 | $ 16,205 |
Weighted Average Life (Years) | 2 years 9 months 18 days | 3 years 3 months 18 days |
Acquired customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 34,186 | $ 32,150 |
Accumulated Amortization | (12,265) | (7,735) |
Net Carrying Amount | 21,921 | 24,415 |
Net Carrying Amount | $ 21,921 | $ 24,415 |
Weighted Average Life (Years) | 4 years 8 months 12 days | 5 years 6 months |
Trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 4,100 | $ 4,100 |
Accumulated Amortization | (1,157) | (711) |
Net Carrying Amount | 2,943 | 3,389 |
Net Carrying Amount | $ 2,943 | $ 3,389 |
Weighted Average Life (Years) | 6 years 7 months 6 days | 7 years 7 months 6 days |
Patents | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 170 | $ 170 |
Accumulated Amortization | (135) | (127) |
Net Carrying Amount | 35 | 43 |
Domain name | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 44 | 44 |
Accumulated Amortization | 0 | 0 |
Net Carrying Amount | $ 44 | $ 44 |
Goodwill and Net Intangible A_6
Goodwill and Net Intangible Assets - Estimated Remaining Amortization Expense (Details) $ in Thousands | Jan. 31, 2023 USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2024 | $ 10,887 |
2025 | 9,686 |
2026 | 7,969 |
2027 | 5,803 |
2028 | 3,491 |
Thereafter | 1,189 |
Total | $ 39,025 |
Share-Based Compensation - Narr
Share-Based Compensation - Narrative (Details) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Jan. 31, 2023 USD ($) purchasePeriod $ / shares shares | Jan. 31, 2022 USD ($) $ / shares shares | Jan. 31, 2021 USD ($) $ / shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation | $ 176,555 | $ 114,900 | $ 72,022 |
Capitalized software development costs | 3,500 | $ 2,000 | $ 2,000 |
Unrecognized share based compensation expense | $ 491,800 | ||
Unrecognized share based compensation expense, period for recognition | 2 years 8 months 12 days | ||
2018 ESPP | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Granted (in shares) | shares | 467,751 | ||
Offering period | 6 months | ||
Number of purchase periods | purchasePeriod | 1 | ||
Purchase period | 6 months | ||
Purchase price percent | 85% | ||
Maximum number of shares authorized (in shares) | shares | 4,850,775 | 4,040,430 | |
Share-based compensation | $ 2,000 | ||
2018 ESPP | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Payroll deduction percent of base cash compensation | 15% | ||
Common Class A | 2018 ESPP | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Period in which shares authorized increase | 10 years | ||
Common Class A | 2018 ESPP | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Maximum number of shares authorized (in shares) | shares | 20,400,000 | ||
Common Class A and B | 2018 ESPP | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Percent of shares outstanding | 1% | ||
Stock option | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expiration period | 10 years | ||
Weighted average grant date fair value, stock options (in dollars per share) | $ / shares | $ 18.16 | $ 29.71 | $ 18.95 |
Fair value of stock options vested | $ 9,100 | $ 10,100 | $ 11,100 |
Intrinsic value of options exercised | $ 27,000 | $ 141,100 | $ 141,300 |
Stock option | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years | ||
Stock option | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 4 years | ||
RSUs | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Granted (in shares) | shares | 7,965,718 | ||
Weighted-average grant date fair value, RSU (in dollars per share) | $ / shares | $ 39.16 | $ 68.21 | $ 43.19 |
Fair value of awards vested | $ 160,400 | $ 78,000 | $ 48,100 |
Weighted-average grant date fair value, RSA (in dollars per share) | $ / shares | $ 46.56 | $ 60.95 | |
RSUs | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years | ||
RSUs | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 4 years | ||
Restricted stock award | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years | ||
RSAs | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Granted (in shares) | shares | 0 | ||
Weighted-average grant date fair value, RSU (in dollars per share) | $ / shares | $ 0 | ||
Fair value of awards vested | $ 1,300 | $ 1,600 | $ 0 |
Weighted-average grant date fair value, RSA (in dollars per share) | $ / shares | $ 46.93 | $ 46.93 | |
Performance Share Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Granted (in shares) | shares | 251,027 | ||
Weighted-average grant date fair value, RSU (in dollars per share) | $ / shares | $ 53.34 | ||
Weighted-average grant date fair value, RSA (in dollars per share) | $ / shares | $ 53.34 | $ 0 | |
Performance Share Units | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Percentage of the target number of shares | 0% | ||
Performance Share Units | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Percentage of the target number of shares | 200% |
Share-Based Compensation - Stoc
Share-Based Compensation - Stock Options (Details) - Stock option - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Jan. 31, 2023 | Jan. 31, 2022 | |
Options Outstanding | ||
Outstanding beginning balance (in shares) | 4,573,482 | |
Granted (in shares) | 253,049 | |
Exercised (in shares) | (859,115) | |
Forfeited or canceled (in shares) | (148,128) | |
Outstanding ending balance (in shares) | 3,819,288 | 4,573,482 |
Exercisable (in shares) | 3,050,682 | |
Vested and expected to vest (in shares) | 3,701,994 | |
Weighted-Average Exercise Price | ||
Outstanding beginning balance (in dollars per share) | $ 20.87 | |
Granted (in dollars per share) | 36.34 | |
Exercised (in dollars per share) | 9.46 | |
Forfeited or canceled (in dollars per share) | 47.80 | |
Outstanding ending balance (in dollars per share) | 23.42 | $ 20.87 |
Exercisable (in dollars per share) | 15.72 | |
Vested and expected to vest (in dollars per share) | $ 22.44 | |
Weighted-Average Remaining Contractual Term (years) | ||
Outstanding | 5 years 8 months 12 days | 6 years 2 months 12 days |
Exercisable | 4 years 10 months 24 days | |
Vested and expected to vest | 5 years 7 months 6 days | |
Aggregate Intrinsic Value (in thousands) | ||
Outstanding | $ 90,985 | $ 192,982 |
Exercisable | 88,960 | |
Vested and expected to vest | $ 90,641 |
Share-Based Compensation - Rest
Share-Based Compensation - Restricted Stock Units (Details) - RSUs - $ / shares | 12 Months Ended | ||
Jan. 31, 2023 | Jan. 31, 2022 | Jan. 31, 2021 | |
Number of Shares Underlying Outstanding RSUs | |||
Outstanding beginning balance (in shares) | 7,281,232 | ||
Granted (in shares) | 7,965,718 | ||
Vested (in shares) | (2,813,339) | ||
Forfeited or canceled (in shares) | (1,458,454) | ||
Outstanding ending balance (in shares) | 10,975,157 | 7,281,232 | |
Weighted-Average Grant-Date Fair Value per RSU | |||
Outstanding beginning balance (in dollars per share) | $ 60.95 | ||
Granted (in dollars per share) | 39.16 | $ 68.21 | $ 43.19 |
Vested (in dollars per share) | 57.03 | ||
Forfeited or canceled (in dollars per share) | 57.82 | ||
Outstanding ending balance (in dollars per share) | $ 46.56 | $ 60.95 |
Share-Based Compensation - Perf
Share-Based Compensation - Performance Share Units (Details) - Performance Share Units | 12 Months Ended |
Jan. 31, 2023 $ / shares shares | |
Number of Shares | |
Outstanding beginning balance (in shares) | shares | 0 |
Granted (in shares) | shares | 251,027 |
Vested (in shares) | shares | 0 |
Forfeited or canceled (in shares) | shares | 0 |
Outstanding ending balance (in shares) | shares | 251,027 |
Weighted-Average Grant-Date Fair Value per Share | |
Outstanding beginning balance (in dollars per share) | $ / shares | $ 0 |
Granted (in dollars per share) | $ / shares | 53.34 |
Vested (in dollars per share) | $ / shares | 0 |
Forfeited or canceled (in dollars per share) | $ / shares | 0 |
Outstanding ending balance (in dollars per share) | $ / shares | $ 53.34 |
Share-Based Compensation - Re_2
Share-Based Compensation - Restricted Stock Awards (Details) - RSAs | 12 Months Ended |
Jan. 31, 2023 $ / shares shares | |
Number of Shares | |
Outstanding beginning balance (in shares) | shares | 56,288 |
Granted (in shares) | shares | 0 |
Vested (in shares) | shares | (28,144) |
Forfeited or canceled (in shares) | shares | (8,249) |
Outstanding ending balance (in shares) | shares | 19,895 |
Weighted-Average Grant-Date Fair Value per Share | |
Outstanding beginning balance (in dollars per share) | $ / shares | $ 46.93 |
Granted (in dollars per share) | $ / shares | 0 |
Vested (in dollars per share) | $ / shares | 46.93 |
Forfeited or canceled (in dollars per share) | $ / shares | 46.93 |
Outstanding ending balance (in dollars per share) | $ / shares | $ 46.93 |
Share-Based Compensation - Empl
Share-Based Compensation - Employee Stock Purchase Plan (Details) | 12 Months Ended |
Jan. 31, 2023 shares | |
2018 Plan | |
Shares Available for Issuance | |
Balance at beginning of period (in shares) | 15,067,025 |
Authorized (in shares) | 6,390,477 |
Granted (in shares) | (8,469,794) |
Forfeited (in shares) | 1,606,582 |
Balance at end of period (in shares) | 14,594,290 |
2018 ESPP | |
Shares Available for Issuance | |
Balance at beginning of period (in shares) | 4,040,430 |
Authorized (in shares) | 1,278,096 |
Granted (in shares) | (467,751) |
Forfeited (in shares) | 0 |
Balance at end of period (in shares) | 4,850,775 |
Share-Based Compensation - Valu
Share-Based Compensation - Valuation Assumptions (Details) | 12 Months Ended | ||
Jan. 31, 2023 | Jan. 31, 2022 | Jan. 31, 2021 | |
Employee Stock Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected term (in years) | 6 years 3 months | 6 years 3 months | 6 years 3 months |
Expected dividend yield | 0% | 0% | 0% |
Employee Stock Options | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Risk-free interest rate | 1.80% | 1% | 0.60% |
Expected volatility | 44.20% | 43.10% | 43% |
Employee Stock Options | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Risk-free interest rate | 3.70% | 1.40% | 0.70% |
Expected volatility | 46.30% | 43.50% | 43.50% |
Employee Stock Purchase Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected term (in years) | 6 months | 6 months | |
Expected dividend yield | 0% | 0% | 0% |
Employee Stock Purchase Plan | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Risk-free interest rate | 0.20% | 0% | 0.10% |
Expected volatility | 50% | 46.90% | 39.90% |
Expected term (in years) | 3 months 7 days | ||
Employee Stock Purchase Plan | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Risk-free interest rate | 2.50% | 0.10% | 1.90% |
Expected volatility | 72.80% | 68% | 68% |
Expected term (in years) | 6 months | ||
Performance Share Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Risk-free interest rate | 4.30% | ||
Expected volatility | 52.50% | ||
Expected volatility (S&P Software and Services Select Index) | 31.80% | ||
Expected dividend yield | 0% | ||
Performance Share Units | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected term (in years) | 1 year | ||
Performance Share Units | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected term (in years) | 2 years |
Share-Based Compensation - Shar
Share-Based Compensation - Share-Based Compensation Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 31, 2023 | Jan. 31, 2022 | Jan. 31, 2021 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Share-based compensation | $ 176,555 | $ 114,900 | $ 72,022 |
Cost of subscription revenue | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Share-based compensation | 11,248 | 6,274 | 4,385 |
Cost of professional services revenue | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Share-based compensation | 6,404 | 3,788 | 2,146 |
Research and development | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Share-based compensation | 62,165 | 41,218 | 25,072 |
Sales and marketing | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Share-based compensation | 63,224 | 40,632 | 25,921 |
General and administrative | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Share-based compensation | $ 33,514 | $ 22,988 | $ 14,498 |
Income Taxes - Loss Before Prov
Income Taxes - Loss Before Provision for Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 31, 2023 | Jan. 31, 2022 | Jan. 31, 2021 | |
Income Tax Disclosure [Abstract] | |||
United States | $ (216,167) | $ (174,043) | $ (120,958) |
Foreign | 3,377 | 3,242 | 2,226 |
Loss before income tax provision (benefit) | $ (212,790) | $ (170,801) | $ (118,732) |
Income Taxes - Schedule of Inco
Income Taxes - Schedule of Income Tax Expense (Benefit) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 31, 2023 | Jan. 31, 2022 | Jan. 31, 2021 | |
Current: | |||
Federal | $ 876 | $ 0 | $ 0 |
State | 1,239 | 175 | 115 |
Foreign | 1,085 | 49 | 63 |
Total current tax provision (benefit) | 3,200 | 224 | 178 |
Deferred and other: | |||
Federal | 0 | 0 | (3,117) |
State | 0 | 0 | (898) |
Foreign | (351) | 72 | 84 |
Total deferred tax provision (benefit) | (351) | 72 | (3,931) |
Total income tax provision (benefit) | $ 2,849 | $ 296 | $ (3,753) |
Income Taxes - Effective Tax Ra
Income Taxes - Effective Tax Rate Reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 31, 2023 | Jan. 31, 2022 | Jan. 31, 2021 | |
Income Tax Disclosure [Abstract] | |||
Income tax at statutory federal rate | $ (44,686) | $ (35,868) | $ (24,934) |
Tax credits | (7,660) | (5,697) | (5,657) |
Change in valuation allowance | 44,898 | 71,738 | 51,296 |
Share-based compensation | 7,558 | (30,092) | (24,057) |
Global intangible low taxed income inclusion | 2,276 | 0 | 0 |
Other | 463 | 215 | (401) |
Total income tax provision (benefit) | $ 2,849 | $ 296 | $ (3,753) |
Income Taxes - Schedule of Defe
Income Taxes - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Jan. 31, 2023 | Jan. 31, 2022 |
Deferred tax assets: | ||
Net operating loss carryforwards | $ 121,171 | $ 147,348 |
Deferred revenue | 117,579 | 82,904 |
Capitalized research & experimental expenditures | 45,906 | 0 |
Tax credits | 29,267 | 23,677 |
Lease liabilities | 17,273 | 19,379 |
Share-based compensation | 17,282 | 16,595 |
Accrued compensation | 8,983 | 5,711 |
Other | 982 | 1,097 |
Total deferred tax assets | 358,443 | 296,711 |
Valuation allowance | (302,196) | (247,130) |
Total deferred tax assets, net | 56,247 | 49,581 |
Deferred tax liabilities: | ||
Capitalized commissions | (30,836) | (23,242) |
Lease right-of-use assets | (14,320) | (17,023) |
Intangibles | (7,637) | (8,265) |
Property and equipment | (2,250) | (1,186) |
Other | (989) | 0 |
Total deferred tax liabilities | (56,032) | (49,716) |
Net deferred tax assets (liabilities) | $ 215 | |
Net deferred tax assets (liabilities) | $ (135) |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Jan. 31, 2023 | Jan. 31, 2022 | Jan. 31, 2021 | Jan. 31, 2020 | |
Operating Loss Carryforwards [Line Items] | ||||
Income tax provision (benefit) | $ 2,849 | $ 296 | $ (3,753) | |
Increase in valuation allowance | 55,100 | |||
Federal tax net operating loss carryforward, not subject to expiration | 419,300 | |||
Federal tax net operating loss carryforward, subject to expiration | 54,500 | |||
Tax credit carryforward for income tax purposes | 29,200 | |||
Liability for uncertain tax positions | 0 | 0 | ||
Unrecognized tax benefits | 9,883 | 7,204 | 5,283 | $ 3,339 |
Unrecognized tax benefits that would impact effective tax rate | 9,900 | 7,200 | ||
Penalties and interest expense | 0 | $ 0 | $ 0 | |
Domestic Tax Authority | ||||
Operating Loss Carryforwards [Line Items] | ||||
Federal tax net operating loss carryforward | 473,800 | |||
State and Local Jurisdiction | ||||
Operating Loss Carryforwards [Line Items] | ||||
Federal tax net operating loss carryforward | $ 307,800 |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 31, 2023 | Jan. 31, 2022 | Jan. 31, 2021 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Balance, beginning of the year | $ 7,204 | $ 5,283 | $ 3,339 |
Increases to tax positions taken during the current year | 2,218 | 2,010 | 2,046 |
Increases to tax positions taken in prior years | 461 | 0 | 11 |
Decreases to tax positions taken in prior years | (89) | (113) | |
Balance, end of year | $ 9,883 | $ 7,204 | $ 5,283 |
Leases - Narrative (Details)
Leases - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 31, 2023 | Jan. 31, 2022 | Jan. 31, 2021 | |
Lessee, Lease, Description [Line Items] | |||
Impairment loss | $ 1,500 | ||
Lease cost | 22,508 | $ 18,739 | $ 15,586 |
Bellevue, WA and Denver, CO | |||
Lessee, Lease, Description [Line Items] | |||
Lease cost | $ 3,500 | ||
Minimum | |||
Lessee, Lease, Description [Line Items] | |||
Remaining lease term | 1 year | ||
Maximum | |||
Lessee, Lease, Description [Line Items] | |||
Remaining lease term | 6 years | ||
Option to extend lease | 5 years |
Leases - Components of Lease Ex
Leases - Components of Lease Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 31, 2023 | Jan. 31, 2022 | Jan. 31, 2021 | |
Leases [Abstract] | |||
Operating lease cost | $ 22,508 | $ 18,739 | $ 15,586 |
Finance lease cost: | |||
Amortization of assets | 0 | 0 | 3,093 |
Interest on lease liabilities | 0 | 0 | 114 |
Short-term lease cost | 950 | 371 | 1,493 |
Variable lease cost | 2,833 | 2,850 | 2,606 |
Sublease income | (527) | 0 | 0 |
Total lease costs | $ 25,764 | $ 21,960 | $ 22,892 |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 31, 2023 | Jan. 31, 2022 | Jan. 31, 2021 | |
Cash paid for amounts included in the measurement of lease liabilities: | |||
Operating cash flows related to operating leases | $ 19,735 | $ 17,610 | $ 14,249 |
Operating cash flows related to finance leases | 0 | 0 | 114 |
Financing cash flows related to finance leases | 0 | 0 | 4,129 |
Right Of Use Assets Obtained In Exchange For Lease Obligations [Abstract] | |||
Right-of-use assets obtained in exchange for new operating lease liabilities | 7,230 | 994 | 35,415 |
Right-of-use assets reductions related to operating leases | $ 4,696 | $ 0 | $ 0 |
Weighted-average remaining lease term (in years) | 4 years 6 months | 5 years 3 months 18 days | |
Weighted-average discount rate | 5.30% | 5% |
Leases - Schedule of Future Pay
Leases - Schedule of Future Payments for Operating and Finance Leases (Details) $ in Thousands | Jan. 31, 2023 USD ($) |
Operating Leases | |
Fiscal 2024 | $ 19,683 |
Fiscal 2025 | 17,029 |
Fiscal 2026 | 14,577 |
Fiscal 2027 | 10,868 |
Fiscal 2028 | 6,078 |
Thereafter | 6,235 |
Total payments | 74,470 |
Less: imputed interest | (7,686) |
Total operating lease liabilities | 66,784 |
Sublease Receipts | |
Fiscal 2024 | 1,495 |
Fiscal 2025 | 1,592 |
Fiscal 2026 | 1,645 |
Fiscal 2027 | 700 |
Thereafter | 0 |
Total | $ 5,432 |
Commitments and Contingencies -
Commitments and Contingencies - Purchase Commitments (Details) $ in Thousands | Jan. 31, 2023 USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Fiscal 2024 | $ 49,390 |
Fiscal 2025 | 64,350 |
Fiscal 2026 | 46,366 |
Fiscal 2027 | 0 |
Fiscal 2028 | 0 |
Thereafter | 0 |
Total | $ 160,106 |
Commitments and Contingencies_2
Commitments and Contingencies - Narrative (Details) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended |
Dec. 31, 2021 | Jan. 31, 2023 | |
Other Commitments [Line Items] | ||
Legal settlement payment | $ 10 | |
Insurance Claims | ||
Other Commitments [Line Items] | ||
Legal settlement recovery | $ 4.5 | |
Estimated legal settlement recovery | $ 3.9 |
401(k) and Pension Plans (Detai
401(k) and Pension Plans (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||
Jul. 31, 2021 | Jan. 31, 2023 | Jan. 31, 2022 | Jan. 31, 2021 | |
Retirement Benefits [Abstract] | ||||
Employer matching contribution, percent of match | 50% | |||
Employer matching contribution, percent of employees' eligible pay | 6% | |||
Expense related to matching contributions | $ 9.5 | $ 6.7 | $ 4.4 | |
Expense related to employer contributions | $ 2.5 | $ 1.6 | $ 1 |
Geographic Information - Revenu
Geographic Information - Revenue by Geographic Location (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 31, 2023 | Jan. 31, 2022 | Jan. 31, 2021 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenue | $ 766,915 | $ 550,832 | $ 385,513 |
United States | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenue | 640,604 | 454,246 | 314,177 |
EMEA | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenue | 65,574 | 51,603 | 37,463 |
Asia Pacific | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenue | 29,946 | 21,326 | 15,325 |
Americas other than the United States | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenue | $ 30,791 | $ 23,657 | $ 18,548 |
Geographic Information - Long-l
Geographic Information - Long-lived Assets (Details) - USD ($) $ in Thousands | Jan. 31, 2023 | Jan. 31, 2022 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | $ 70,613 | $ 84,287 |
United States | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | 60,246 | 79,278 |
EMEA | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | 5,583 | 3,828 |
Asia Pacific | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | 4,510 | 1,153 |
Americas other than the United States | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | $ 274 | $ 28 |
Subsequent Events Narrative (De
Subsequent Events Narrative (Details) $ in Millions | Jan. 31, 2023 USD ($) |
Insurance Claims | |
Subsequent Event [Line Items] | |
Estimated legal settlement recovery | $ 3.9 |