Cover
Cover - shares | 6 Months Ended | |
Jul. 31, 2020 | Aug. 21, 2020 | |
Entity Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Amendment Flag | false | |
Document Period End Date | Jul. 31, 2020 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q2 | |
Entity File Number | 001-38865 | |
Entity Registrant Name | Zoom Video Communications, Inc. | |
Entity Central Index Key | 0001585521 | |
Current Fiscal Year End Date | --01-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | true | |
Entity Shell Company | false | |
Entity Current Reporting Status | Yes | |
Entity Tax Identification Number | 61-1648780 | |
Entity Incorporation, State or Country Code | DE | |
Entity Address, Address Line One | 55 Almaden Boulevard, 6th Floor | |
Entity Address, State or Province | CA | |
Entity Address, City or Town | San Jose | |
Entity Address, Postal Zip Code | 95113 | |
City Area Code | 888 | |
Local Phone Number | 799-9666 | |
Trading Symbol | ZM | |
Security Exchange Name | NASDAQ | |
Entity Interactive Data Current | Yes | |
Title of 12(b) Security | Class A Common Stock, $0.001 par value per share | |
Class A Common Stock | ||
Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 194,757,207 | |
Class B Common Stock | ||
Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 89,663,773 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jul. 31, 2020 | Jan. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 748,944 | $ 283,134 |
Marketable securities | 732,995 | 572,060 |
Accounts receivable, net of allowances of $26,161 and $7,634 as of July 31, 2020 and January 31, 2020, respectively | 295,330 | 120,435 |
Deferred contract acquisition costs, current | 111,545 | 44,885 |
Prepaid expenses and other current assets | 343,288 | 75,008 |
Total current assets | 2,232,102 | 1,095,522 |
Deferred contract acquisition costs, noncurrent | 152,595 | 46,245 |
Property and equipment, net | 91,291 | 57,138 |
Operating lease right-of-use assets | 65,295 | 68,608 |
Goodwill | 24,340 | 0 |
Other assets, noncurrent | 59,318 | 22,332 |
Total assets | 2,624,941 | 1,289,845 |
Current liabilities: | ||
Accounts payable | 12,615 | 1,596 |
Accrued expenses and other current liabilities | 560,188 | 122,692 |
Customer deposits liabilities | 714,523 | 209,542 |
Total current liabilities | 1,287,326 | 333,830 |
Deferred revenue, noncurrent | 28,090 | 20,994 |
Operating lease liabilities, noncurrent | 63,105 | 64,792 |
Other liabilities, noncurrent | 47,608 | 36,286 |
Total liabilities | 1,426,129 | 455,902 |
Commitments and contingencies (Note 7) | ||
Stockholders’ equity: | ||
Preferred stock | 0 | 0 |
Common stock, $0.001 par value per share, 2,000,000,000 Class A shares authorized as of July 31, 2020 and January 31, 2020; 194,145,480 and 123,391,114 shares issued and outstanding as of July 31, 2020 and January 31, 2020, respectively; 300,000,000 Class B shares authorized as of July 31, 2020 and January 31, 2020; 90,197,239 and 155,336,747 shares issued and outstanding as of July 31, 2020 and January 31, 2020, respectively | 283 | 277 |
Additional paid-in capital | 982,541 | 832,705 |
Accumulated other comprehensive income | 2,772 | 809 |
Retained earnings | 213,216 | 152 |
Total stockholders’ equity | 1,198,812 | 833,943 |
Total liabilities and stockholders’ equity | $ 2,624,941 | $ 1,289,845 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Jul. 31, 2020 | Jan. 31, 2020 |
Accounts receivable, allowances | $ 26,161 | $ 7,634 |
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 200,000,000 | 200,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Class A Common Stock | ||
Common stock, shares authorized (in shares) | 2,000,000,000 | 2,000,000,000 |
Common stock, shares issued (in shares) | 194,145,480 | 123,391,114 |
Common stock, shares outstanding (in shares) | 194,145,480 | 123,391,114 |
Class B Common Stock | ||
Common stock, shares authorized (in shares) | 300,000,000 | 300,000,000 |
Common stock, shares issued (in shares) | 90,197,239 | 155,336,747 |
Common stock, shares outstanding (in shares) | 90,197,239 | 155,336,747 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jul. 31, 2020 | Jul. 31, 2019 | Jul. 31, 2020 | Jul. 31, 2019 | |
Income Statement [Abstract] | ||||
Revenue | $ 663,520 | $ 145,826 | $ 991,687 | $ 267,814 |
Cost of revenue | 192,271 | 27,900 | 295,978 | 52,004 |
Gross profit | 471,249 | 117,926 | 695,709 | 215,810 |
Operating expenses: | ||||
Research and development | 42,734 | 15,054 | 69,123 | 28,837 |
Sales and marketing | 159,173 | 79,652 | 280,729 | 143,693 |
General and administrative | 81,238 | 20,955 | 134,368 | 39,458 |
Total operating expenses | 283,145 | 115,661 | 484,220 | 211,988 |
Income from operations | 188,104 | 2,265 | 211,489 | 3,822 |
Interest income and other, net | 2,081 | 4,492 | 7,871 | 5,465 |
Net income before provision for income taxes | 190,185 | 6,757 | 219,360 | 9,287 |
Provision for income taxes | 4,196 | 1,216 | 6,296 | 1,532 |
Net income | 185,989 | 5,541 | 213,064 | 7,755 |
Undistributed earnings attributable to participating securities | (247) | (20) | (305) | (2,794) |
Net income attributable to common stockholders | $ 185,742 | $ 5,521 | $ 212,759 | $ 4,961 |
Net income per share attributable to common stockholders: | ||||
Basic (in dollars per share) | $ 0.66 | $ 0.02 | $ 0.76 | $ 0.03 |
Diluted (in dollars per share) | $ 0.63 | $ 0.02 | $ 0.72 | $ 0.02 |
Weighted-average shares used in computing net income per share attributable to common stockholders: | ||||
Basic (in shares) | 282,850,805 | 271,813,141 | 281,394,901 | 192,130,510 |
Diluted (in shares) | 297,162,309 | 292,185,665 | 296,408,229 | 215,774,619 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jul. 31, 2020 | Jul. 31, 2019 | Jul. 31, 2020 | Jul. 31, 2019 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income (loss) | $ 185,989 | $ 5,541 | $ 213,064 | $ 7,755 |
Other comprehensive income (loss): | ||||
Unrealized gain (loss) on available-for-sale marketable securities, net of tax | 885 | (76) | 1,963 | 67 |
Comprehensive income | $ 186,874 | $ 5,465 | $ 215,027 | $ 7,822 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY (DEFICIT) - USD ($) $ in Thousands | Total | Convertible Preferred Stock | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit |
Beginning balance (in shares) at Jan. 31, 2019 | 152,665,804 | 90,327,435 | ||||
Beginning balance at Jan. 31, 2019 | $ (7,439) | $ 159,552 | $ 89 | $ 17,760 | $ (135) | $ (25,153) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of common stock upon exercise of stock options (in shares) | (152,665,804) | 152,665,804 | ||||
Issuance of common stock upon exercise of stock options | 159,552 | $ (159,552) | $ 153 | 159,399 | ||
Conversion of convertible preferred stock to common stock upon initial public offering (in shares) | 426,223 | |||||
Issuance of common stock upon exercise of stock options | 15,344 | |||||
Issuance of common stock upon initial public offering and private placement, net of underwriting discounts and commissions and other offering costs (in shares) | 15,819,646 | |||||
Issuance of common stock upon initial public offering and private placement, net of underwriting discounts and commissions and other offering costs | 541,499 | $ 16 | 541,483 | |||
Issuance of common stock upon exercise of stock options, net of repurchases (in shares) | 13,747,059 | |||||
Issuance of common stock upon exercise of stock options, net of repurchases | $ 2,174 | $ 14 | 2,160 | |||
Issuance of common stock reserved for charitable donation (in shares) | 500,000 | |||||
Charitable donation of common stock | $ 0 | |||||
Stock-based compensation expense | 24,844 | 24,844 | ||||
Other comprehensive income | 67 | 67 | ||||
Net income (loss) | 7,755 | 7,755 | ||||
Ending balance (in shares) at Jul. 31, 2019 | 0 | 273,486,167 | ||||
Ending balance at Jul. 31, 2019 | 743,796 | $ 0 | $ 272 | 760,990 | (68) | (17,398) |
Beginning balance (in shares) at Apr. 30, 2019 | 0 | 272,336,862 | ||||
Beginning balance at Apr. 30, 2019 | 719,728 | $ 0 | $ 271 | 742,388 | 8 | (22,939) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Conversion of convertible preferred stock to common stock upon initial public offering (in shares) | 649,305 | |||||
Issuance of common stock upon exercise of stock options | 421 | $ 1 | 420 | |||
Issuance of common stock upon release of restricted stock units (in shares) | 500,000 | |||||
Issuance of common stock upon release of restricted stock units | 0 | 0 | ||||
Stock-based compensation expense | 18,182 | 18,182 | ||||
Other comprehensive income | (76) | (76) | ||||
Net income (loss) | 5,541 | 5,541 | ||||
Ending balance (in shares) at Jul. 31, 2019 | 0 | 273,486,167 | ||||
Ending balance at Jul. 31, 2019 | 743,796 | $ 0 | $ 272 | 760,990 | (68) | (17,398) |
Beginning balance (in shares) at Jan. 31, 2020 | 0 | 278,731,143 | ||||
Beginning balance at Jan. 31, 2020 | $ 833,943 | $ 0 | $ 277 | 832,705 | 809 | 152 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of common stock upon exercise of stock options (in shares) | 4,830,752 | |||||
Issuance of common stock for employee stock purchase plan (in shares) | 605,924 | |||||
Issuance of common stock for employee stock purchase plan | $ 20,760 | $ 1 | 20,759 | |||
Conversion of convertible preferred stock to common stock upon initial public offering (in shares) | 4,830,752 | |||||
Issuance of common stock upon exercise of stock options | 17,681 | $ 5 | 17,676 | |||
Issuance of common stock upon release of restricted stock units (in shares) | 174,900 | |||||
Issuance of common stock upon release of restricted stock units | 0 | |||||
Issuance of common stock upon exercise of stock options, net of repurchases | 23,312 | 23,312 | ||||
Charitable donation of common stock | 88,089 | 88,089 | ||||
Stock-based compensation expense | 1,963 | 1,963 | ||||
Net income (loss) | 213,064 | 213,064 | ||||
Ending balance (in shares) at Jul. 31, 2020 | 0 | 284,342,719 | ||||
Ending balance at Jul. 31, 2020 | 1,198,812 | $ 0 | $ 283 | 982,541 | 2,772 | 213,216 |
Beginning balance (in shares) at Apr. 30, 2020 | 0 | 281,992,011 | ||||
Beginning balance at Apr. 30, 2020 | 901,631 | $ 0 | $ 280 | 872,237 | 1,887 | 27,227 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of common stock upon exercise of stock options (in shares) | 1,597,761 | |||||
Issuance of common stock upon exercise of stock options | 7,956 | $ 2 | 7,954 | |||
Issuance of common stock upon release of restricted stock units (in shares) | 147,023 | |||||
Issuance of common stock upon release of restricted stock units | 0 | |||||
Issuance of common stock for employee stock purchase plan (in shares) | 605,924 | |||||
Issuance of common stock for employee stock purchase plan | 20,760 | $ 1 | 20,759 | |||
Charitable donation of common stock | 22,312 | 22,312 | ||||
Stock-based compensation expense | 59,279 | 59,279 | ||||
Other comprehensive income | 885 | 885 | ||||
Net income (loss) | 185,989 | 185,989 | ||||
Ending balance (in shares) at Jul. 31, 2020 | 0 | 284,342,719 | ||||
Ending balance at Jul. 31, 2020 | $ 1,198,812 | $ 0 | $ 283 | $ 982,541 | $ 2,772 | $ 213,216 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW - USD ($) $ in Thousands | 6 Months Ended | |
Jul. 31, 2020 | Jul. 31, 2019 | |
Cash flows from operating activities: | ||
Net income (loss) | $ 213,064 | $ 7,755 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Stock-based compensation expense | 85,632 | 24,737 |
Amortization of deferred contract acquisition costs | 40,781 | 16,026 |
Charitable donation of common stock | 23,312 | 0 |
Provision for accounts receivable allowances | 14,959 | 2,693 |
Depreciation and amortization | 11,814 | 7,174 |
Non-cash operating lease cost | 4,597 | 3,116 |
Remeasurement gain on equity investment | (2,538) | 0 |
Other | 2,028 | (514) |
Changes in operating assets and liabilities: | ||
Accounts receivable | (196,926) | (35,361) |
Prepaid expenses and other assets | (53,729) | (23,597) |
Deferred contract acquisition costs | (213,790) | (33,700) |
Accounts payable | 10,871 | (2,783) |
Accrued expenses and other liabilities | 202,066 | 34,923 |
Deferred revenue | 519,149 | 56,234 |
Operating lease liabilities, net | (979) | (3,295) |
Net cash provided by operating activities | 660,311 | 53,408 |
Cash flows from investing activities: | ||
Purchases of marketable securities | (484,882) | (478,487) |
Maturities of marketable securities | 287,338 | 50,940 |
Sales of marketable securities | 36,897 | 0 |
Purchases of property and equipment | (35,253) | (20,937) |
Cash paid for acquisition, net of cash acquired | (26,486) | 0 |
Purchase of equity investment | (8,000) | 0 |
Purchase of convertible promissory note | (5,000) | 0 |
Purchase of intangible assets | (1,494) | 0 |
Collections of employee loans | 1,319 | 0 |
Net cash used in investing activities | (235,561) | (448,484) |
Cash flows from financing activities: | ||
Proceeds from employee equity transactions to be remitted to employees and tax authorities, net | 234,465 | 0 |
Proceeds from issuance of common stock for employee stock purchase plan | 20,760 | 0 |
Proceeds from exercise of stock options, net of repurchases | 17,417 | 2,191 |
Proceeds from initial public offering and private placement, net of underwriting discounts and commissions and other offering costs | 0 | 542,947 |
Net cash provided by financing activities | 272,642 | 545,138 |
Net increase in cash, cash equivalents, and restricted cash | 697,392 | 150,062 |
Cash, cash equivalents, and restricted cash – beginning of period | 334,082 | 65,968 |
Cash, cash equivalents, and restricted cash – end of period | 1,031,474 | 216,030 |
Reconciliation of cash, cash equivalents, and restricted cash within the condensed consolidated balance sheets to the amounts shown in the condensed consolidated statements of cash flows above: | ||
Cash and cash equivalents | 748,944 | 213,886 |
Total cash, cash equivalents, and restricted cash | $ 1,031,474 | $ 216,030 |
Summary of Business and Signifi
Summary of Business and Significant Accounting Policies | 6 Months Ended |
Jul. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Summary of Business and Significant Accounting Policies | Summary of Business and Significant Accounting Policies Description of Business Zoom Video Communications, Inc. and its subsidiaries (collectively, “Zoom,” the “Company,” “we,” “us,” or “our”) provide a video-first, unified communications platform. Our platform combines video, audio, phone, screen sharing, and chat functionalities. We were incorporated in the state of Delaware in April 2011, and are headquartered in San Jose, California. Fiscal Year Our fiscal year ends on January 31. References to fiscal year 2021, for example, refer to the fiscal year ending January 31, 2021. Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) and applicable regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting, and include the accounts of Zoom Video Communications, Inc., its subsidiaries, and a variable interest entity for which we are the primary beneficiary. All intercompany balances and transactions have been eliminated in consolidation. The condensed consolidated balance sheet as of January 31, 2020 included herein was derived from the audited financial statements as of that date, but does not include all disclosures, including certain notes required by GAAP on an annual reporting basis. The unaudited condensed consolidated financial statements reflect all normal recurring adjustments necessary to present fairly the balance sheets, statements of operations, statements of comprehensive income, statements of convertible preferred stock and stockholders’ equity (deficit), and statements of cash flows for the interim periods, but are not necessarily indicative of the results of operations to be anticipated for the full fiscal year or any future period. The unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes included in our Annual Report on Form 10-K for the year ended January 31, 2020, filed with the SEC on March 20, 2020. Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements, and the reported amounts of revenue and expenses during the reporting period. Significant items subject to such estimates and assumptions include, but are not limited to, the estimated expected benefit period for deferred contract acquisition costs, the allowance for credit losses, the useful lives of long-lived assets, the incremental borrowing rate for operating leases, the value of common stock and other assumptions used to measure stock-based compensation expense, sales and other tax liabilities, the fair value of marketable securities, equity investment, convertible promissory note, acquired intangible assets and goodwill, and the valuation of deferred income tax assets and uncertain tax positions. Actual results could differ from those estimates. The COVID-19 pandemic has created, and may continue to create, significant uncertainty in macroeconomic conditions, and the extent of its impact on our operational and financial performance will depend on certain developments, including the duration and spread of the outbreak and the impact on our customers and our sales cycles. During the three and six months ended July 31, 2020, our estimates and assumptions required increased judgment and carried a higher degree of variability and volatility. As events continue to evolve and additional information becomes available, our estimates may change materially in future periods. Summary of Significant Accounting Policies Our significant accounting policies are discussed in Note 1. “Summary of Business and Significant Accounting Policies” in the notes to consolidated financial statements included in our Annual Report on Form 10-K for the year ended January 31, 2020, filed with the SEC on March 20, 2020. There have been no significant changes to these policies during the six months ended July 31, 2020, except as noted below. Restricted Cash Restricted cash consisted of certificates of deposit collateralizing our operating leases, corporate credit cards, and cash from proceeds from international employees’ sales of our common stock, and is included in prepaid expenses and other current assets and other assets, noncurrent in the condensed consolidated balance sheets. As of July 31, 2020 and January 31, 2020, we had $280.2 million and $48.5 million, respectively, of cash from proceeds from international employees’ sales of our common stock. The amount is held in our bank account until it is remitted to the employees and the tax authorities. Due to the restrictions on the use of the funds in the bank account, we have classified the amount as restricted cash included in prepaid expenses and other current assets, and a corresponding amount is included in accrued expenses and other current liabilities in the condensed consolidated balance sheets. Allowance for Credit Losses We are exposed to credit losses primarily through our accounts receivable and investments in available-for-sale debt securities. See Note 3 for additional information related to our available-for-sale debt securities. Accounts receivable, net Accounts receivable are recorded for invoiced amounts and amounts for which revenue has been recognized, but not invoiced, net of allowances. Our short-term accounts receivable consist of the following: As of July 31, 2020 (in thousands) Accounts receivable, gross $ 321,491 Less: Allowance for credit losses (17,500) Less: Allowance for returns (8,661) Accounts receivable, net $ 295,330 We maintain an allowance for credit losses for expected uncollectible accounts receivable, which is recorded as an offset to accounts receivable, and changes in such are classified as general and administrative expense in the condensed consolidated statements of operations. The allowance for credit losses is based on management’s estimate for expected credit losses for outstanding accounts receivable. We determine expected credit losses based on historical write-off experience, an analysis of the aging of outstanding receivables, customer payment patterns, the establishment of specific reserves for customers in an adverse financial condition, and adjust based upon our expectations of changes in macro-economic conditions that may impact the collectibility of outstanding receivables, including noncurrent accounts receivable. We also consider current market conditions and reasonable and supportable forecasts of future economic conditions to inform adjustments to historical loss data. We reassess the adequacy of the allowance for credit losses each reporting period. For the six months ended July 31, 2020, our assessment considered business and market disruptions caused by COVID-19 and estimates of credit and collectibility trends. The continued volatility in market conditions and evolving shifts in credit trends are difficult to predict, causing variability and volatility that may have a material impact on our allowance for credit losses in future periods. Below is a rollforward of our allowance for credit losses for the six months ended July 31, 2020. (in thousands) Balance as of January 31, 2020 $ 5,150 Provision for credit losses 13,723 Write-offs (1,373) Balance as of July 31, 2020 $ 17,500 Available-for-sale Investments Available-for-sale investments consist primarily of high-grade commercial paper, agency bonds, corporate bonds, corporate and other debt securities, U.S. government agency securities, and treasury bills. We classify our marketable securities as available-for-sale at the time of purchase and reevaluate such classification at each balance sheet date. We may sell these securities at any time for use in current operations even if they have not yet reached maturity. As a result, we classify our securities, including those with maturities beyond 12 months, as current assets in the condensed consolidated balance sheets. We carry these securities at fair value and record unrealized gains and losses in accumulated other comprehensive income, which is reflected as a component of stockholders’ equity. We evaluate our securities with unrealized loss positions as to whether the declines in fair value were due to credit losses, and record the portion of impairment relating to the credit losses through allowance for credit losses limited to the amount that fair value was less than the amortized cost basis. Realized gains and losses from the sale of marketable securities are determined based on the specific identification method. Realized gains and losses are reported in interest income and other, net in the condensed consolidated statements of operations. Cloud Computing Arrangement Implementation Costs We capitalize certain implementation costs incurred in a cloud computing arrangement during the application development stage. Costs incurred in the preliminary stages of development are analogous to research and development activities and are expensed as incurred. The preliminary stage includes activities such as formulation and evaluation of alternatives, determination of existence of needed technology, and final selection of alternatives. Once the application development stage is reached, internal and external costs are capitalized until the hosted software is ready for its intended use. Capitalized implementation costs are recorded as deferred costs, and are included in prepaid expenses and other current assets and other assets, noncurrent in the condensed consolidated balance sheets. Maintenance, minor upgrades, and training costs are expensed as incurred. Capitalized implementation costs are amortized over the term of the hosting arrangement on a straight-line basis, and are recorded under operating expenses in the same line item in the condensed consolidated statements of operations as the expense for fees for the associated hosting arrangement. Capitalized implementation costs were not material during the three and six months ended July 31, 2020. Equity Investment In the third quarter of fiscal year 2020, we made a $3.0 million strategic investment in a private company in the business of designing and developing video communications hardware. In the first quarter of fiscal year 2021, we made an additional $8.0 million strategic investment in this company. We do not have a controlling financial interest in the investee nor the ability to exercise significant influence over the operating and financial policies of the investee. The investment is included within other assets, noncurrent in the condensed consolidated balance sheets. Dividend income, unrealized and realized holding gains or losses, and impairment charges would be reported in interest income and other, net in the condensed consolidated statements of operations. The maximum loss we could incur for this investment is its carrying value. We have elected to measure this investment, which does not have a readily determinable fair value, at its cost, minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer (i.e., using the measurement alternative). At each reporting period, we perform a qualitative assessment considering impairment indicators to evaluate whether the investment is impaired. If this qualitative assessment indicates that the investment is impaired and the fair value of the investment is less than its carrying amount, the investment would be written down to its fair value. In connection with the additional investment and the indicated change in the observable price of the underlying shares of the investee, we have recognized a remeasurement gain of $2.5 million on the initial investment in the six months ended July 31, 2020. As of July 31, 2020, the carrying amount of this investment was $13.5 million. Convertible Promissory Note In the first quarter of fiscal year 2021, we invested $5.0 million in a five-year convertible promissory note of a privately held company (the “Convertible Note”), which bears interest at 3.0% on the unpaid principal balance, compounded annually. We may elect to convert the Convertible Note into shares of the privately held company’s stock prior to, or on, the maturity date of the Convertible Note. Upon a liquidity event, the Convertible Note will be automatically converted into shares of the privately held company’s stock. The Convertible Note is included in other assets, noncurrent in the condensed consolidated balance sheets. Interest accrues on the unpaid principal balance on a quarterly basis, and is recognized in interest income and other, net in the condensed consolidated statements of operations. Interest income related to the Convertible Note was immaterial for the three and six months ended July 31, 2020. We have elected to measure the Convertible Note at fair value (i.e., using the fair value option) at each reporting date. Under the fair value option, bifurcation of an embedded derivative is not necessary, and all related gains and losses on the host contract and derivative due to change in the fair value will be reflected in interest income and other, net in the condensed consolidated statements of operations. As of July 31, 2020, the fair value of the Convertible Note investment was measured at $5.0 million. Business Combinations We account for our business combinations using the acquisition method of accounting, which requires, among other things, allocation of the fair value of purchase consideration to the tangible and intangible assets acquired and liabilities assumed at their estimated fair values on the acquisition date. The excess of the fair value of purchase consideration over the values of these identifiable assets and liabilities is recorded as goodwill. When determining the fair value of assets acquired and liabilities assumed, we make estimates and assumptions, especially with respect to intangible assets. Our estimates of fair value are based upon assumptions believed to be reasonable, but which are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates. During the measurement period, not to exceed one year from the date of acquisition, we may record adjustments to the assets acquired and liabilities assumed, with a corresponding offset to goodwill if new information is obtained related to facts and circumstances that existed as of the acquisition date. After the measurement period, any subsequent adjustments are reflected in the condensed consolidated statements of operations. Acquisition costs, such as legal and consulting fees, are expensed as incurred. Uncertain tax positions and tax-related valuation allowances are initially established in connection with a business combination as of the acquisition date. We continue to collect information and reevaluate these estimates and assumptions quarterly. We will record any adjustments to our preliminary estimates to goodwill, provided that it is within the one-year measurement period. Goodwill and Acquired Intangible Assets Goodwill amounts are not amortized, but rather tested for impairment at least annually or more often if circumstances indicate that the carrying value may not be recoverable. There were no impairment charges to goodwill during the three months ended July 31, 2020. Acquired intangible assets consist of identifiable intangible assets resulting from business combinations. Acquired finite-lived intangible assets are initially recorded at fair value and are amortized on a straight-line basis over their estimated useful lives. Amortization expense of developed technology is recorded within cost of revenue in the condensed consolidated statements of operations. Each period we evaluate the estimated remaining useful lives of our acquired finite-lived intangible assets and whether events or changes in circumstances warrant a revision to the remaining period of amortization. There were no impairment charges to acquired intangible assets during the three months ended July 31, 2020. Recently Adopted Accounting Pronouncements In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments , which was subsequently amended by ASU No. 2018-19, Codification Improvements to Topic 326, Financial Instruments—Credit Losses , in November 2018. Subsequently, the FASB issued ASU No. 2019-04, ASU No. 2019-05, ASU No. 2019-10, and ASU No. 2019-11 to provide additional guidance on the credit losses standard. ASU No. 2016-13 and the related updates replace the existing incurred loss impairment model with an expected credit loss model, and requires a financial asset measured at amortized cost to be presented at the net amount expected to be collected. We adopted the standard as of February 1, 2020, using the modified retrospective method of applying the new standard at the adoption date. Our adoption did not result in any cumulative effect adjustment in our condensed consolidated financial statements upon adoption as of February 1, 2020. In August 2018, the FASB issued ASU No. 2018-15, Intangibles—Goodwill and Other—Internal—Use Software (subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract . The amendment aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). We adopted ASU No. 2018-15, prospectively, as of February 1, 2020, and our adoption did not have a material impact on the condensed consolidated financial statements. |
Revenue Recognition
Revenue Recognition | 6 Months Ended |
Jul. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Revenue Recognition Disaggregation of Revenue The following table summarizes revenue by region based on the billing address of customers: Three Months Ended July 31, Six Months Ended July 31, 2020 2019 2020 2019 Amount Percentage of Amount Percentage of Amount Percentage of Amount Percentage of (in thousands, except percentages) Americas $ 454,160 69 % $ 117,098 80 % $ 699,793 71 % $ 215,258 80 % Asia Pacific (“APAC”) 81,384 12 12,088 8 111,641 11 22,529 9 Europe, Middle East, and Africa (“EMEA”) 127,976 19 16,640 12 180,253 18 30,027 11 Total $ 663,520 100 % $ 145,826 100 % $ 991,687 100 % $ 267,814 100 % Contract Balances We receive payments from customers based on a billing schedule as established in our customer contracts. Accounts receivable are recorded when we contractually have the right to consideration. In some arrangements, a right to consideration for our performance under the customer contract may occur before invoicing to the customer, resulting in an unbilled accounts receivable. The amount of unbilled accounts receivable included within accounts receivable, net of allowances in the condensed consolidated balance sheets was $20.5 million and $12.5 million as of July 31, 2020 and January 31, 2020, respectively. Contract liabilities consist of deferred revenue. Revenue is deferred when we have the right to invoice in advance of performance under a customer contract. The current portion of deferred revenue balances is recognized over the next 12 months. The amount of revenue recognized during the three months ended July 31, 2020 and 2019 that was included in deferred revenue at the beginning of each period was $233.5 million and $64.6 million, respectively, and $166.4 million and $90.7 million during the six months ended July 31, 2020 and 2019, respectively. Remaining Performance Obligation The terms of our subscription agreements are monthly, annual, and multiyear, and we may bill for the full term in advance or on an annual, quarterly, or monthly basis, depending on the billing terms with customers. As of July 31, 2020, the aggregate amount of the transaction price allocated to our remaining performance obligations was $1,415.8 million, which consists of both billed consideration in the amount of $742.6 million and unbilled consideration that we expect to recognize as revenue in the amount of $673.2 million. We expect to recognize 72% of our remaining performance obligations as revenue over the next 12 months and the remainder thereafter. |
Marketable Securities
Marketable Securities | 6 Months Ended |
Jul. 31, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Marketable Securities | Marketable Securities As of July 31, 2020 and January 31, 2020, our marketable securities consisted of the following: As of July 31, 2020 Amortized Gross Gross Estimated (in thousands) Commercial paper $ 6,990 $ — $ — $ 6,990 Agency bonds 302,221 193 (45) 302,369 Corporate and other debt securities 362,539 2,571 (28) 365,082 U.S. government agency securities 43,479 81 — 43,560 Treasury bills 14,994 — — 14,994 Marketable securities $ 730,223 $ 2,845 $ (73) $ 732,995 As of January 31, 2020 Amortized Gross Gross Estimated (in thousands) Commercial paper $ 37,894 $ — $ — $ 37,894 Agency bonds 141,157 49 (43) 141,163 Corporate and other debt securities 320,407 775 (16) 321,166 U.S. government agency securities 71,794 45 (2) 71,837 Marketable securities $ 571,252 $ 869 $ (61) $ 572,060 We review the individual securities that have unrealized losses on a regular basis to evaluate whether or not any security has experienced, or is expected to experience, credit losses resulting in the decline in fair value. We evaluate, among other factors, whether we have the intention to sell any of these marketable securities and whether it is more likely than not that we will be required to sell any of them before recovery of the amortized cost basis. We have not recorded an allowance for credit losses, as we believe any such losses would be immaterial based on the high-grade credit rating for each of our marketable securities as of the end of each period. There were no material realized gains or losses from available-for-sale securities that were reclassified out of accumulated other comprehensive income for the three and six months ended July 31, 2020 and 2019. The following table presents the contractual maturities of our marketable securities as of July 31, 2020 and January 31, 2020: As of July 31, 2020 January 31, 2020 (in thousands) Less than one year $ 400,094 $ 315,900 Due in one to five years 332,901 256,160 Total $ 732,995 $ 572,060 |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jul. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The following table presents information about our financial instruments that are measured at fair value on a recurring basis and indicate the fair value hierarchy of the valuation inputs utilized to determine such fair value: As of July 31, 2020 Fair Value Level 1 Level 2 Level 3 (in thousands) Financial Assets: Money market funds $ 157,220 $ 157,220 $ — $ — Cash equivalents 157,220 157,220 — — Commercial paper 6,990 — 6,990 — Agency bonds 302,369 — 302,369 — Corporate and other debt securities 365,082 — 365,082 — U.S. government agency securities 43,560 — 43,560 — Treasury bills 14,994 — 14,994 — Marketable securities 732,995 — 732,995 — Certificate of deposit included in prepaid expenses and other current assets 100 — 100 — Certificates of deposit included in other assets, noncurrent 2,221 — 2,221 — Convertible Note included in other assets, noncurrent 5,000 — — 5,000 Total financial assets $ 897,536 $ 157,220 $ 735,316 $ 5,000 As of January 31, 2020 Fair Value Level 1 Level 2 Level 3 (in thousands) Financial Assets: Money market funds $ 96,486 $ 96,486 $ — $ — Commercial paper 4,994 — 4,994 — Agency bonds 9,999 — 9,999 — Cash equivalents 111,479 96,486 14,993 — Commercial paper 37,894 — 37,894 — Agency bonds 141,163 — 141,163 — Corporate and other debt securities 321,166 — 321,166 — U.S. government agency securities 71,837 — 71,837 — Marketable securities 572,060 — 572,060 — Certificate of deposit included in prepaid expenses and other current assets 100 — 100 — Certificates of deposit included in other assets, noncurrent 2,301 — 2,301 — Total financial assets $ 685,940 $ 96,486 $ 589,454 $ — We classify our highly liquid money market funds within Level 1 of the fair value hierarchy because they are valued based on quoted market prices in active markets. We classify our commercial paper, agency bonds, corporate bonds, corporate and other debt securities, U.S. government agency securities, treasury bills, and certificates of deposit within Level 2 because they are valued using inputs other than quoted prices that are directly or indirectly observable in the market, including readily available pricing sources for the identical underlying security, which may not be actively traded. We classify the Convertible Note as Level 3 due to the lack of relevant observable market data over fair value inputs, such as the probability weighting of the various scenarios that can impact settlement of the arrangement. As of July 31, 2020 and January 31, 2020, the carrying amount of the equity investment was $13.5 million and $3.0 million, respectively. We classify the equity investment as Level 3 within the fair value hierarchy only if an impairment or observable adjustment is recognized during the period, as it is based on an observable transaction price at the transaction date and other unobservable inputs, such as volatility. |
Business Combinations
Business Combinations | 6 Months Ended |
Jul. 31, 2020 | |
Business Combinations [Abstract] | |
Business Combinations | Business Combinations On May 7, 2020, we acquired 100% of the issued and outstanding share capital of Keybase, a secure messaging and file-sharing company, for purchase consideration of $42.9 million in cash. The acquisition helps us strengthen the security of our video communications platform by providing end-to-end encryption expertise that we plan to leverage as we develop and roll out an end-to-end encryption offering in the future. The acquisition has been accounted for as a business combination. In allocating the purchase consideration, $24.3 million was attributed to goodwill, $3.3 million to intangible assets, and $15.3 million to other net assets acquired primarily consisting of cash and cash equivalents of $16.4 million. The goodwill amount represents synergies related to our existing products expected to be realized from the acquisition and assembled workforce. The associated goodwill is not deductible for tax purposes. Acquired intangible assets consisted of developed technology with an estimated useful life of five years. The developed technology had a remaining useful life of 4.8 years as of July 31, 2020, and is amortized using the straight-line method over its estimated useful life. Not included in the purchase consideration, we also entered into holdback agreements with certain employees for $20.0 million in cash payments, which are subject to such employees’ continued service with us. The holdback amount of $20.0 million will be treated as compensation for research and development over the required service period ranging from one Transaction costs incurred in connection with the acquisition were immaterial. The results of operations of Keybase have been included in our condensed consolidated financial statements from the date of the acquisition. Pro forma and historical results of operations of Keybase have not been presented, as the results do not have a material effect on any of the periods presented in our condensed consolidated statements of operations. |
Balance Sheet Components
Balance Sheet Components | 6 Months Ended |
Jul. 31, 2020 | |
Balance Sheet Components [Abstract] | |
Balance Sheet Components | Balance Sheet Components Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consisted of the following: As of July 31, 2020 January 31, 2020 (in thousands) Restricted cash from international employee stock sales $ 280,209 $ 48,547 Prepaid expenses 54,854 22,320 Other 8,225 4,141 Prepaid expenses and other current assets $ 343,288 $ 75,008 Property and Equipment, Net Property and equipment consisted of the following: As of July 31, 2020 January 31, 2020 (in thousands) Computer and office equipment $ 82,783 $ 51,375 Software 21,452 10,855 Leasehold improvements 19,812 18,215 Furniture and fixtures 3,936 3,949 Property and equipment, gross 127,983 84,394 Less: Accumulated depreciation (36,692) (27,256) Property and equipment, net $ 91,291 $ 57,138 Depreciation expense was $6.4 million and $3.8 million for the three months ended July 31, 2020 and 2019, respectively, and $11.7 million and $7.2 million for the six months ended July 31, 2020 and 2019, respectively. Other Assets, Noncurrent Other assets, noncurrent consisted of the following: As of July 31, 2020 January 31, 2020 (in thousands) Accounts receivable, noncurrent $ 22,950 $ 9,011 Equity investment 13,538 3,000 Convertible Note 5,000 — Prepaid expenses, noncurrent 4,693 2,945 Indefinite-lived intangible assets 3,654 2,159 Intangible assets subject to amortization, net 3,146 — Other 6,337 5,217 Other assets, noncurrent $ 59,318 $ 22,332 Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consisted of the following: As of July 31, 2020 January 31, 2020 (in thousands) Proceeds from employee equity transactions to be remitted to employees and tax authorities $ 284,550 $ 49,287 Accrued compensation and benefits 133,629 36,732 Accrued expenses 87,492 17,475 Sales and other tax liabilities 22,998 3,774 Operating lease liabilities, current 9,667 7,675 Customer deposits liabilities 9,582 3,414 Other 12,270 4,335 Accrued expenses and other current liabilities $ 560,188 $ 122,692 Other Liabilities, Noncurrent Other liabilities, noncurrent consisted of the following: As of July 31, 2020 January 31, 2020 (in thousands) Sales and other tax liabilities $ 44,388 $ 33,957 Other 3,220 2,329 Other liabilities, noncurrent $ 47,608 $ 36,286 |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jul. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Non-cancelable Purchase Obligations As of July 31, 2020, we had additional outstanding non-cancelable purchase obligations with a term of 12 months or longer of $25.8 million over the corresponding amount disclosed in our Annual Report on Form 10-K for the year ended January 31, 2020, mainly related to third-party cloud hosting. Operating Leases Not Yet Commenced As of July 31, 2020, we had additional operating leases for office space that have not yet commenced with undiscounted future lease payments of $8.9 million. These operating leases will commence in the fourth quarter of fiscal year 2021. License Agreement In May 2020, we entered into a license agreement with MPEG LA, LLC (“MPEGLA”) to obtain the rights for future use of licensed intellectual property in exchange for periodic royalty payments. In connection with the license agreement, we made a royalty payment of $9.8 million to use the technology until December 31, 2020, which is amortized in cost of revenue on a straight-line basis in our condensed consolidated statements of operations. During the six months ended July 31, 2020, we recorded $2.9 million of such costs. In addition, we made a one-time payment of $9.8 million for past use, which was recorded in general and administrative expenses in our condensed consolidated statements of operations for the six months ended July 31, 2020. Legal Proceedings Beginning on March 30, 2020, multiple putative class actions have been filed against us in various U.S. federal district courts and state courts relating to our alleged privacy and security practices, including alleged data sharing with third parties (the “U.S. Privacy Class Actions”). We have also been sued under the DC private attorney general statute on behalf of members of the general public. The plaintiffs claim violations of a variety of state consumer protection and privacy laws, and also assert state constitutional and common law claims, such as negligence and unjust enrichment. The U.S. Privacy Class Actions seek to certify both nationwide and state-specific classes of individuals using our services in certain time periods. The plaintiffs seek various forms of injunctive and monetary relief, including restitution, statutory and actual damages, punitive damages, and attorneys’ fees. The federal cases have been transferred to and consolidated in the Northern District of California with our consent; lead plaintiffs’ counsel have been appointed; and plaintiffs’ consolidated amended complaint was filed on July 30, 2020, with our response due on September 14, 2020. On April 7, 2020 and April 8, 2020, securities class action complaints were filed against us and two of our officers in the United States District Court for the Northern District of California. The plaintiffs are purported stockholders of the company. The complaints allege, among other things, that we violated Sections 10(b) and 20(a) of the Exchange Act, and Rule 10b-5 by making false and misleading statements and omissions of material fact about our data privacy and security measures. The complaints seek unspecified damages, interest, fees, and costs. On May 18, 2020, the actions were consolidated. On June 11, 2020 and July 30, 2020, purported shareholder derivative complaints were filed in the United States District Court for the District of Delaware. The first complaint names as defendants nine of our officers and directors, and the second complaint names eight of our officers and directors. The lawsuits assert state and federal claims and are based on the same alleged misstatements as the shareholder class action complaint. The lawsuits accuse our board of directors of failing to exercise reasonable and prudent supervision over our management, policies, practices, and internal controls. The plaintiffs seek unspecified monetary damages on behalf of us as well as governance reforms. Both derivative cases are stayed pending resolution of a forthcoming motion to dismiss the securities class action. We believe these lawsuits are without merit, and we are vigorously defending ourselves against them. Given the uncertainty of litigation, the preliminary stage of the cases, and the legal standards that must be met for, among other things, class certification and success on the merits, we cannot estimate the reasonably possible loss or range of loss that may result from these actions. In addition, from time to time, we are involved in various other legal proceedings arising from the normal course of business activities. We are not presently a party to any other such litigation the outcome of which, we believe, if determined adversely to us, would individually, or taken together, have a material adverse effect on our business, operating results, cash flows, or financial condition. |
Stockholders_ Equity and Equity
Stockholders’ Equity and Equity Incentive Plans | 6 Months Ended |
Jul. 31, 2020 | |
Stockholders' Equity Note [Abstract] | |
Stockholders’ Equity and Equity Incentive Plans | Stockholders’ Equity and Equity Incentive Plans Common Stock In connection with our initial public offering (“IPO”) in April 2019, our amended and restated certificate of incorporation became effective, which authorized the issuance of 2,000,000,000 shares of Class A common stock, $0.001 par value per share, and 300,000,000 shares of Class B common stock, $0.001 par value per share. Class A and Class B common stock are referred to as common stock throughout the notes to the condensed consolidated financial statements, unless otherwise noted. Equity Incentive Plans In 2011, we adopted the 2011 Global Share Plan (“2011 Plan”), under which officers, employees, and consultants were granted various forms of equity incentive compensation at the discretion of the board of directors, including stock options and restricted stock awards. In connection with the IPO, the shares of Class B common stock remaining available for issuance under the 2011 Plan became available for issuance for a corresponding number of shares of our Class A common stock under the 2019 Equity Incentive Plan (“2019 Plan”), which is a successor to and continuation of our 2011 Plan. In April 2019, we adopted the 2019 Plan, which became effective in connection with our IPO. Our 2019 Plan provides for the grant of stock options, stock appreciation rights, restricted stock awards, restricted stock unit (“RSU”) awards, performance awards, and other forms of awards. The maximum number of shares of our Class A common stock that may be issued under our 2019 Plan will not exceed 58,300,889 shares of our Class A common stock, which is the sum of (1) 34,000,000 new shares, plus (2) an additional number of shares not to exceed 24,300,889, consisting of (A) shares that remain available for the issuance of awards under our 2011 Plan as of immediately prior to the time our 2019 Plan became effective and (B) shares of Class B common stock, subject to outstanding stock options or other stock awards granted under our 2011 Plan that, on or after the 2019 Plan becomes effective, terminate, or expire prior to exercise or settlement; are not issued because the award is settled in cash; are forfeited because of the failure to vest; or are reacquired or withheld (or not issued) to satisfy a tax withholding obligation or the purchase or exercise price, if any, as such shares become available from time to time. In addition, the number of shares of our Class A common stock reserved for issuance under our 2019 Plan automatically increases on February 1 of each calendar year, starting on February 1, 2020 through February 1, 2029, in an amount equal to (i) 5% of the total number of shares of our common stock (both Class A and Class B) outstanding on January 31 of the fiscal year before the date of each automatic increase, or (ii) a lesser number of shares determined by our board of directors prior to the applicable February 1. Stock Options A summary of stock option activity under our equity incentive plan and related information is as follows: Stock Options Outstanding Weighted- Weighted- Aggregate (in thousands, except share, life, and per share data) Balance as of January 31, 2020 16,833,009 $ 5.73 7.6 $ 1,191,881 Granted — $ — Exercised (4,830,752) $ 3.61 Canceled/forfeited/expired (132,739) $ 5.92 Balance as of July 31, 2020 11,869,518 $ 6.59 7.4 $ 2,935,477 Vested and exercisable as of July 31, 2020 5,021,067 $ 3.28 6.8 $ 1,258,445 As of July 31, 2020, unrecognized stock-based compensation expense related to outstanding unvested stock options was $61.5 million, which is expected to be recognized over a weighted-average period of 2.3 years. Restricted Stock Units A summary of RSU activity under our equity incentive plan and related information is as follows: RSUs Unvested Weighted- Unvested as of January 31, 2020 1,964,668 $ 79.11 Granted 2,617,599 $ 202.30 Vested (166,366) $ 88.53 Canceled/forfeited (45,290) $ 98.34 Unvested as of July 31, 2020 4,370,611 $ 152.33 As of July 31, 2020, unrecognized stock-based compensation expense related to outstanding unvested RSUs was $619.3 million, which is expected to be recognized over a weighted-average period of 3.0 years. 2019 Employee Stock Purchase Plan In April 2019, we adopted the 2019 Employee Stock Purchase Plan (“ESPP”), which became effective in connection with the IPO. A total of 9,000,000 shares of our Class A common stock were initially reserved for issuance under the ESPP. The number of shares of our Class A common stock reserved for issuance automatically increases on February 1 of each calendar year, beginning on February 1, 2020 through February 1, 2029, by the lesser of (1) 1% of the total number of shares of our common stock (both Class A and Class B) outstanding on the last day of the fiscal year before the date of the automatic increase and (2) 7,500,000 shares; provided that before the date of any such increase, our board of directors may determine that such increase will be less than the amount set forth in clauses (1) and (2). Under our current ESPP, Class A common stock will be purchased for the accounts of employees participating in the ESPP at a price per share equal to the lesser of (1) 85% of the fair market value of a share of our Class A common stock on the first date of an offering or (2) 85% of the fair market value of a share of our Class A common stock on the date of purchase. No employee may purchase shares under the ESPP at a rate in excess of $25,000 worth of our Class A common stock based on the fair market value per share of our Class A common stock at the beginning of an offering for each calendar year such purchase right is outstanding or 3,000 shares. The 2019 ESPP provides for, at maximum, 27 months offering periods with four offering dates, generally in June and December of each year. The first offering period began on April 18, 2019. As of July 31, 2020, 1,096,192 shares of our Class A common stock have been purchased under the ESPP. As of July 31, 2020, unrecognized stock-based compensation expense related to the ESPP was $56.0 million, which is expected to be recognized over a weighted-average period of 0.9 years. Early Exercise of Common Stock Options Our board of directors authorized certain stock option holders to exercise unvested options to purchase shares of common stock. Shares received from such early exercises are subject to repurchase in the event of the optionee’s termination of service, at the original issuance price, until the options are fully vested. As of July 31, 2020 and January 31, 2020, 354,087 and 466,819 shares, respectively, of Class B common stock were subject to repurchase at a weighted-average price of $2.65 and $2.58 per share, respectively. The cash proceeds received for unvested shares of common stock recorded within accrued expenses and other current liabilities in the condensed consolidated balance sheets were $0.9 million and $1.2 million as of July 31, 2020 and January 31, 2020, respectively. Shares Reserved for Charitable Donations During fiscal year 2020, our board of directors approved the issuance of 500,000 shares of Class A common stock for the sole purpose of being transferred to nonprofit organizations. As of July 31, 2020, 94,844 shares of Class A common stock have been transferred to a donor advised fund through an unaffiliated nonprofit organization. We recorded a non-cash charge of $23.3 million for the fair value of the donated shares, which was recorded in general and administrative expense in the condensed consolidated statements of operations for the six months ended July 31, 2020. Stock-Based Compensation The stock-based compensation expense by line item in the accompanying condensed consolidated statements of operations is summarized as follows: Three Months Ended July 31, Six Months Ended July 31, 2020 2019 2020 2019 (in thousands) Cost of revenue $ 7,727 $ 1,902 $ 10,976 $ 2,732 Research and development 10,010 2,510 15,234 3,674 Sales and marketing 32,398 10,439 49,521 13,066 General and administrative 6,720 3,224 9,901 5,265 Total stock-based compensation expense $ 56,855 $ 18,075 $ 85,632 $ 24,737 |
Income Taxes
Income Taxes | 6 Months Ended |
Jul. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Our tax provision for interim periods is determined using an estimated annual effective tax rate, adjusted for discrete items arising in the applicable quarter. In each quarter, we update the estimated annual effective tax rate and make a year-to-date adjustment to the provision. The estimated annual effective tax rate is subject to significant volatility due to several factors, including our ability to accurately predict the proportion of our pre-tax income in multiple jurisdictions, certain book-tax differences, and the effects of acquisitions. The following table provides details of the provision for income taxes: Three Months Ended July 31, Six Months Ended July 31, 2020 2019 2020 2019 (in thousands, except percentages) Net income before provision for income taxes $ 190,185 $ 6,757 $ 219,360 $ 9,287 Provision for income taxes 4,196 1,216 6,296 1,532 Effective tax rate 2.2 % 18.0 % 2.9 % 16.5 % The provision for income taxes was $4.2 million and $1.2 million for the three months ended July 31, 2020 and 2019, respectively, and $6.3 million and $1.5 million for the six months ended July 31, 2020 and 2019, respectively. The provision for income taxes for the three and six months ended July 31, 2020 consisted primarily of foreign income taxes, state income taxes, and a one-time benefit from the release of a valuation allowance as a result of an acquisition. For the three and six months ended July 31, 2020 and 2019, the provision for income taxes differed from the U.S. federal statutory rate primarily due to stock-based compensation and the full valuation allowance on the U.S. and the U.K. deferred tax assets. The realization of tax benefits of net deferred tax assets is dependent upon future levels of taxable income, of an appropriate character, in the periods the items are expected to be deductible or taxable. Based on the available objective evidence during the three and six months ended July 31, 2020, we believe it is more likely than not that the tax benefits of the U.S. and the U.K. losses incurred may not be realized. Accordingly, we recorded a full valuation allowance against the tax benefits of the U.S. and the U.K. losses incurred. We intend to maintain the full valuation allowance on the U.S. and the U.K. net deferred tax assets until sufficient positive evidence exists to support a reversal of, or decrease in, the valuation allowance. We recorded a valuation allowance against all of our deferred tax assets (“DTAs”) for the U.S. and U.K. as of both July 31, 2020 and January 31, 2020. We intend to continue maintaining a full valuation allowance on our DTAs until there is sufficient evidence to support the reversal of all or some portion of these allowances. However, given our current earnings and anticipated future earnings, we believe that there is a reasonable possibility that within the next 12 months, sufficient positive evidence may become available to reach a conclusion that a significant portion of the valuation allowance will no longer be needed. Release of the valuation allowance would result in the recognition of certain DTAs and a decrease to income tax expense for the period the release is recorded. However, the exact timing and amount of the valuation allowance release are subject to change on the basis of the level of profitability that we are able to actually achieve. During the three and six months ended July 31, 2020, there were no material changes to the total amount of unrecognized tax benefits and we do not expect any significant changes in the next 12 months. On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was passed into law and amended portions of relevant tax laws. The CARES Act did not have a significant impact on the provision for income taxes for the three and six months ended July 31, 2020. We will continue to monitor future guidance issued regarding the CARES Act and other similar stimulus measures to determine any future impacts. |
Net Income Per Share Attributab
Net Income Per Share Attributable to Common Stockholders | 6 Months Ended |
Jul. 31, 2020 | |
Earnings Per Share [Abstract] | |
Net Income Per Share Attributable to Common Stockholders | Net Income Per Share Attributable to Common Stockholders The following table sets forth the computation of basic and diluted net income per share attributable to common stockholders for the periods presented: Three Months Ended July 31, Six Months Ended July 31, 2020 2019 2020 2019 Class A Class B Class A Class B Class A Class B Class A Class B Numerator: (in thousands, except share and per share data) Net income $ 122,474 $ 63,515 $ 751 $ 4,790 $ 125,297 $ 87,767 $ 592 $ 7,163 Less: Undistributed earnings attributable to participating securities — (247) — (20) — (305) — (2,794) Net income attributable to common stockholders, basic $ 122,474 $ 63,268 $ 751 $ 4,770 $ 125,297 $ 87,462 $ 592 $ 4,369 Reallocation of net income attributable to common stockholders (4,343) 4,343 (50) 50 (4,824) 4,824 (64) 64 Net income attributable to common stockholders, diluted $ 118,131 $ 67,611 $ 701 $ 4,820 $ 120,473 $ 92,286 $ 528 $ 4,433 Denominator: Weighted-average shares used in computing net income per share attributable to common stockholders, basic 186,505,788 96,345,017 36,950,454 234,862,687 165,718,132 115,676,769 22,908,474 169,222,036 Weighted-average shares used in computing net income per share attributable to common stockholders, diluted 188,994,684 108,167,625 37,120,969 255,064,696 167,839,216 128,569,013 22,977,562 192,797,057 Net income per share attributable to common stockholders, basic $ 0.66 $ 0.66 $ 0.02 $ 0.02 $ 0.76 $ 0.76 $ 0.03 $ 0.03 Net income per share attributable to common stockholders, diluted $ 0.63 $ 0.63 $ 0.02 $ 0.02 $ 0.72 $ 0.72 $ 0.02 $ 0.02 The potential shares of common stock that were excluded from the computation of diluted net income per share attributable to common stockholders for the periods presented because including them would have been anti-dilutive are as follows: Three Months Ended July 31, Six Months Ended July 31, 2020 2019 2020 2019 Class A Class B Class A Class B Class A Class B Class A Class B Outstanding stock options — — 116,649 — — — 59,291 — Unvested RSUs 85,596 — 153,751 — 598,728 — 78,150 — Purchase rights committed under the ESPP 35,996 — 23,509 — 18,196 — 11,949 — Total 121,592 — 293,909 — 616,924 — 149,390 — The table above does not include 405,156 shares of issued Class A common stock held by us as of July 31, 2020 that are reserved for the sole purpose of being transferred to nonprofit organizations. |
Summary of Business and Signi_2
Summary of Business and Significant Accounting Policies (Policies) | 6 Months Ended |
Jul. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) and applicable regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting, and include the accounts of Zoom Video Communications, Inc., its subsidiaries, and a variable interest entity for which we are the primary beneficiary. All intercompany balances and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements, and the reported amounts of revenue and expenses during the reporting period. Significant items subject to such estimates and assumptions include, but are not limited to, the estimated expected benefit period for deferred contract acquisition costs, the allowance for credit losses, the useful lives of long-lived assets, the incremental borrowing rate for operating leases, the value of common stock and other assumptions used to measure stock-based compensation expense, sales and other tax liabilities, the fair value of marketable securities, equity investment, convertible promissory note, acquired intangible assets and goodwill, and the valuation of deferred income tax assets and uncertain tax positions. Actual results could differ from those estimates. |
Restricted Cash | Restricted Cash Restricted cash consisted of certificates of deposit collateralizing our operating leases, corporate credit cards, and cash from proceeds from international employees’ sales of our common stock, and is included in prepaid expenses and other current assets and other assets, noncurrent in the condensed consolidated balance sheets. |
Allowance for Credit Losses | Allowance for Credit LossesWe are exposed to credit losses primarily through our accounts receivable and investments in available-for-sale debt securities. We maintain an allowance for credit losses for expected uncollectible accounts receivable, which is recorded as an offset to accounts receivable, and changes in such are classified as general and administrative expense in the condensed consolidated statements of operations. The allowance for credit losses is based on management’s estimate for expected credit losses for outstanding accounts receivable. We determine expected credit losses based on historical write-off experience, an analysis of the aging of outstanding receivables, customer payment patterns, the establishment of specific reserves for customers in an adverse financial condition, and adjust based upon our expectations of changes in macro-economic conditions that may impact the collectibility of outstanding receivables, including noncurrent accounts receivable. We also consider current market conditions and reasonable and supportable forecasts of future economic conditions to inform adjustments to historical loss data. We reassess the adequacy of the allowance for credit losses each reporting period.For the six months ended July 31, 2020, our assessment considered business and market disruptions caused by COVID-19 and estimates of credit and collectibility trends. The continued volatility in market conditions and evolving shifts in credit trends are difficult to predict, causing variability and volatility that may have a material impact on our allowance for credit losses in future periods. |
Available for Sale Investments | Available-for-sale Investments Available-for-sale investments consist primarily of high-grade commercial paper, agency bonds, corporate bonds, corporate and other debt securities, U.S. government agency securities, and treasury bills. We classify our marketable securities as available-for-sale at the time of purchase and reevaluate such classification at each balance sheet date. We may sell these securities at any time for use in current operations even if they have not yet reached maturity. As a result, we classify our securities, including those with maturities beyond 12 months, as current assets in the condensed consolidated balance sheets. We carry these securities at fair value and record unrealized gains and losses in accumulated other comprehensive income, which is reflected as a component of stockholders’ equity. We evaluate our securities with unrealized loss positions as to whether the declines in fair value were due to credit losses, and record the portion of impairment relating to the credit losses through allowance for credit losses limited to the amount that fair value was less than the amortized cost basis. Realized gains |
Cloud Computing Arrangement Implementation Costs | Cloud Computing Arrangement Implementation Costs We capitalize certain implementation costs incurred in a cloud computing arrangement during the application development stage. Costs incurred in the preliminary stages of development are analogous to research and development activities and are expensed as incurred. The preliminary stage includes activities such as formulation and evaluation of alternatives, determination of existence of needed technology, and final selection of alternatives. Once the application development stage is reached, internal and external costs are capitalized until the hosted software is ready for its intended use. Capitalized implementation costs are recorded as deferred costs, and are included in prepaid expenses and other current assets and other assets, noncurrent in the condensed consolidated balance sheets. Maintenance, minor upgrades, and training costs are expensed as incurred. Capitalized implementation costs are amortized over the term of the hosting arrangement on a straight-line basis, and are recorded under operating expenses in the same line item in the condensed consolidated statements of operations as the expense for fees for the associated hosting arrangement. Capitalized implementation costs were not material during the three and six months ended July 31, 2020. |
Equity Investment | We do not have a controlling financial interest in the investee nor the ability to exercise significant influence over the operating and financial policies of the investee. The investment is included within other assets, noncurrent in the condensed consolidated balance sheets. Dividend income, unrealized and realized holding gains or losses, and impairment charges would be reported in interest income and other, net in the condensed consolidated statements of operations. The maximum loss we could incur for this investment is its carrying value. We have elected to measure this investment, which does not have a readily determinable fair value, at its cost, minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer (i.e., using the measurement alternative). At each reporting period, we perform a qualitative assessment considering impairment indicators to evaluate whether the investment is impaired. If this qualitative assessment indicates that the investment is impaired and the fair value of the investment is less than its carrying amount, the investment would be written down to its fair value. |
Convertible Promissory Note | Convertible Promissory Note In the first quarter of fiscal year 2021, we invested $5.0 million in a five-year convertible promissory note of a privately held company (the “Convertible Note”), which bears interest at 3.0% on the unpaid principal balance, compounded annually. We may elect to convert the Convertible Note into shares of the privately held company’s stock prior to, or on, the maturity date of the Convertible Note. Upon a liquidity event, the Convertible Note will be automatically converted into shares of the privately held company’s stock. The Convertible Note is included in other assets, noncurrent in the condensed consolidated balance sheets. Interest accrues on the unpaid principal balance on a quarterly basis, and is recognized in interest income and other, net in the condensed consolidated statements of operations. Interest income related to the Convertible Note was immaterial for the three and six months ended July 31, 2020. We have elected to measure the Convertible Note at fair value (i.e., using the fair value option) at each reporting date. Under the fair value option, bifurcation of an embedded derivative is not necessary, and all related gains and losses on the host contract and derivative due to change in the fair value will be reflected in interest income and other, net in the condensed consolidated statements of operations. As of July 31, 2020, the fair value of the Convertible Note investment was measured at $5.0 million. |
Business Combinations | Business Combinations We account for our business combinations using the acquisition method of accounting, which requires, among other things, allocation of the fair value of purchase consideration to the tangible and intangible assets acquired and liabilities assumed at their estimated fair values on the acquisition date. The excess of the fair value of purchase consideration over the values of these identifiable assets and liabilities is recorded as goodwill. When determining the fair value of assets acquired and liabilities assumed, we make estimates and assumptions, especially with respect to intangible assets. Our estimates of fair value are based upon assumptions believed to be reasonable, but which are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates. During the measurement period, not to exceed one year from the date of acquisition, we may record adjustments to the assets acquired and liabilities assumed, with a corresponding offset to goodwill if new information is obtained related to facts and circumstances that existed as of the acquisition date. After the measurement period, any subsequent adjustments are reflected in the condensed consolidated statements of operations. Acquisition costs, such as legal and consulting fees, are expensed as incurred. Uncertain tax positions and tax-related valuation allowances are initially established in connection with a business combination as of the acquisition date. We continue to collect information and reevaluate these estimates and assumptions quarterly. We will record any adjustments to our preliminary estimates to goodwill, provided that it is within the one-year measurement period. |
Goodwill and Acquired Intangible Assets | Goodwill and Acquired Intangible Assets Goodwill amounts are not amortized, but rather tested for impairment at least annually or more often if circumstances indicate that the carrying value may not be recoverable. There were no impairment charges to goodwill during the three months ended July 31, 2020. Acquired intangible assets consist of identifiable intangible assets resulting from business combinations. Acquired finite-lived intangible assets are initially recorded at fair value and are amortized on a straight-line basis over their estimated useful lives. Amortization expense of developed technology is recorded within cost of revenue in the condensed consolidated statements of operations. Each period we evaluate the estimated remaining useful lives of our acquired finite-lived intangible assets and whether events or changes in circumstances warrant a revision to the remaining period of amortization. There were no impairment charges to acquired intangible assets during the three months ended July 31, 2020. |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments , which was subsequently amended by ASU No. 2018-19, Codification Improvements to Topic 326, Financial Instruments—Credit Losses , in November 2018. Subsequently, the FASB issued ASU No. 2019-04, ASU No. 2019-05, ASU No. 2019-10, and ASU No. 2019-11 to provide additional guidance on the credit losses standard. ASU No. 2016-13 and the related updates replace the existing incurred loss impairment model with an expected credit loss model, and requires a financial asset measured at amortized cost to be presented at the net amount expected to be collected. We adopted the standard as of February 1, 2020, using the modified retrospective method of applying the new standard at the adoption date. Our adoption did not result in any cumulative effect adjustment in our condensed consolidated financial statements upon adoption as of February 1, 2020. In August 2018, the FASB issued ASU No. 2018-15, Intangibles—Goodwill and Other—Internal—Use Software (subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract . The amendment aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). We adopted ASU No. 2018-15, prospectively, as of February 1, 2020, and our adoption did not have a material impact on the condensed consolidated financial statements. |
Summary of Business and Signi_3
Summary of Business and Significant Accounting Policies (Tables) | 6 Months Ended |
Jul. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Accounts Receivable, Allowance for Credit Loss | Accounts receivable are recorded for invoiced amounts and amounts for which revenue has been recognized, but not invoiced, net of allowances. Our short-term accounts receivable consist of the following: As of July 31, 2020 (in thousands) Accounts receivable, gross $ 321,491 Less: Allowance for credit losses (17,500) Less: Allowance for returns (8,661) Accounts receivable, net $ 295,330 (in thousands) Balance as of January 31, 2020 $ 5,150 Provision for credit losses 13,723 Write-offs (1,373) Balance as of July 31, 2020 $ 17,500 |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 6 Months Ended |
Jul. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Summary Disaggregation of Revenue by Region | The following table summarizes revenue by region based on the billing address of customers: Three Months Ended July 31, Six Months Ended July 31, 2020 2019 2020 2019 Amount Percentage of Amount Percentage of Amount Percentage of Amount Percentage of (in thousands, except percentages) Americas $ 454,160 69 % $ 117,098 80 % $ 699,793 71 % $ 215,258 80 % Asia Pacific (“APAC”) 81,384 12 12,088 8 111,641 11 22,529 9 Europe, Middle East, and Africa (“EMEA”) 127,976 19 16,640 12 180,253 18 30,027 11 Total $ 663,520 100 % $ 145,826 100 % $ 991,687 100 % $ 267,814 100 % |
Marketable Securities (Tables)
Marketable Securities (Tables) | 6 Months Ended |
Jul. 31, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Summary of Marketable Securities | As of July 31, 2020 and January 31, 2020, our marketable securities consisted of the following: As of July 31, 2020 Amortized Gross Gross Estimated (in thousands) Commercial paper $ 6,990 $ — $ — $ 6,990 Agency bonds 302,221 193 (45) 302,369 Corporate and other debt securities 362,539 2,571 (28) 365,082 U.S. government agency securities 43,479 81 — 43,560 Treasury bills 14,994 — — 14,994 Marketable securities $ 730,223 $ 2,845 $ (73) $ 732,995 As of January 31, 2020 Amortized Gross Gross Estimated (in thousands) Commercial paper $ 37,894 $ — $ — $ 37,894 Agency bonds 141,157 49 (43) 141,163 Corporate and other debt securities 320,407 775 (16) 321,166 U.S. government agency securities 71,794 45 (2) 71,837 Marketable securities $ 571,252 $ 869 $ (61) $ 572,060 |
Summary of Contractual Maturities of Marketable Securities | The following table presents the contractual maturities of our marketable securities as of July 31, 2020 and January 31, 2020: As of July 31, 2020 January 31, 2020 (in thousands) Less than one year $ 400,094 $ 315,900 Due in one to five years 332,901 256,160 Total $ 732,995 $ 572,060 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jul. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of Financial Instruments Measured at Fair Value on Recurring Basis | The following table presents information about our financial instruments that are measured at fair value on a recurring basis and indicate the fair value hierarchy of the valuation inputs utilized to determine such fair value: As of July 31, 2020 Fair Value Level 1 Level 2 Level 3 (in thousands) Financial Assets: Money market funds $ 157,220 $ 157,220 $ — $ — Cash equivalents 157,220 157,220 — — Commercial paper 6,990 — 6,990 — Agency bonds 302,369 — 302,369 — Corporate and other debt securities 365,082 — 365,082 — U.S. government agency securities 43,560 — 43,560 — Treasury bills 14,994 — 14,994 — Marketable securities 732,995 — 732,995 — Certificate of deposit included in prepaid expenses and other current assets 100 — 100 — Certificates of deposit included in other assets, noncurrent 2,221 — 2,221 — Convertible Note included in other assets, noncurrent 5,000 — — 5,000 Total financial assets $ 897,536 $ 157,220 $ 735,316 $ 5,000 As of January 31, 2020 Fair Value Level 1 Level 2 Level 3 (in thousands) Financial Assets: Money market funds $ 96,486 $ 96,486 $ — $ — Commercial paper 4,994 — 4,994 — Agency bonds 9,999 — 9,999 — Cash equivalents 111,479 96,486 14,993 — Commercial paper 37,894 — 37,894 — Agency bonds 141,163 — 141,163 — Corporate and other debt securities 321,166 — 321,166 — U.S. government agency securities 71,837 — 71,837 — Marketable securities 572,060 — 572,060 — Certificate of deposit included in prepaid expenses and other current assets 100 — 100 — Certificates of deposit included in other assets, noncurrent 2,301 — 2,301 — Total financial assets $ 685,940 $ 96,486 $ 589,454 $ — |
Balance Sheet Components (Table
Balance Sheet Components (Tables) | 6 Months Ended |
Jul. 31, 2020 | |
Balance Sheet Components [Abstract] | |
Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets consisted of the following: As of July 31, 2020 January 31, 2020 (in thousands) Restricted cash from international employee stock sales $ 280,209 $ 48,547 Prepaid expenses 54,854 22,320 Other 8,225 4,141 Prepaid expenses and other current assets $ 343,288 $ 75,008 |
Schedule of Property and Equipment | Property and equipment consisted of the following: As of July 31, 2020 January 31, 2020 (in thousands) Computer and office equipment $ 82,783 $ 51,375 Software 21,452 10,855 Leasehold improvements 19,812 18,215 Furniture and fixtures 3,936 3,949 Property and equipment, gross 127,983 84,394 Less: Accumulated depreciation (36,692) (27,256) Property and equipment, net $ 91,291 $ 57,138 |
Schedule of Other Noncurrent Assets | Other assets, noncurrent consisted of the following: As of July 31, 2020 January 31, 2020 (in thousands) Accounts receivable, noncurrent $ 22,950 $ 9,011 Equity investment 13,538 3,000 Convertible Note 5,000 — Prepaid expenses, noncurrent 4,693 2,945 Indefinite-lived intangible assets 3,654 2,159 Intangible assets subject to amortization, net 3,146 — Other 6,337 5,217 Other assets, noncurrent $ 59,318 $ 22,332 |
Schedule of Accrued Expenses and Other Current Liabilities | Accrued expenses and other current liabilities consisted of the following: As of July 31, 2020 January 31, 2020 (in thousands) Proceeds from employee equity transactions to be remitted to employees and tax authorities $ 284,550 $ 49,287 Accrued compensation and benefits 133,629 36,732 Accrued expenses 87,492 17,475 Sales and other tax liabilities 22,998 3,774 Operating lease liabilities, current 9,667 7,675 Customer deposits liabilities 9,582 3,414 Other 12,270 4,335 Accrued expenses and other current liabilities $ 560,188 $ 122,692 |
Schedule of Other Liabilities Non Current | Other liabilities, noncurrent consisted of the following: As of July 31, 2020 January 31, 2020 (in thousands) Sales and other tax liabilities $ 44,388 $ 33,957 Other 3,220 2,329 Other liabilities, noncurrent $ 47,608 $ 36,286 |
Stockholders_ Equity and Equi_2
Stockholders’ Equity and Equity Incentive Plans (Tables) | 6 Months Ended |
Jul. 31, 2020 | |
Stockholders' Equity Note [Abstract] | |
Summary of Stock Option Activity Under Equity Incentive Plan | A summary of stock option activity under our equity incentive plan and related information is as follows: Stock Options Outstanding Weighted- Weighted- Aggregate (in thousands, except share, life, and per share data) Balance as of January 31, 2020 16,833,009 $ 5.73 7.6 $ 1,191,881 Granted — $ — Exercised (4,830,752) $ 3.61 Canceled/forfeited/expired (132,739) $ 5.92 Balance as of July 31, 2020 11,869,518 $ 6.59 7.4 $ 2,935,477 Vested and exercisable as of July 31, 2020 5,021,067 $ 3.28 6.8 $ 1,258,445 |
Summary of Restricted Stock Units (RSUs) Activity Under Equity Incentive Plan | A summary of RSU activity under our equity incentive plan and related information is as follows: RSUs Unvested Weighted- Unvested as of January 31, 2020 1,964,668 $ 79.11 Granted 2,617,599 $ 202.30 Vested (166,366) $ 88.53 Canceled/forfeited (45,290) $ 98.34 Unvested as of July 31, 2020 4,370,611 $ 152.33 |
Summary of Stock-based Compensation Expense by Line Item | The stock-based compensation expense by line item in the accompanying condensed consolidated statements of operations is summarized as follows: Three Months Ended July 31, Six Months Ended July 31, 2020 2019 2020 2019 (in thousands) Cost of revenue $ 7,727 $ 1,902 $ 10,976 $ 2,732 Research and development 10,010 2,510 15,234 3,674 Sales and marketing 32,398 10,439 49,521 13,066 General and administrative 6,720 3,224 9,901 5,265 Total stock-based compensation expense $ 56,855 $ 18,075 $ 85,632 $ 24,737 |
Income Taxes (Tables)
Income Taxes (Tables) | 6 Months Ended |
Jul. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Schedule of Provision for Income Taxes | The following table provides details of the provision for income taxes: Three Months Ended July 31, Six Months Ended July 31, 2020 2019 2020 2019 (in thousands, except percentages) Net income before provision for income taxes $ 190,185 $ 6,757 $ 219,360 $ 9,287 Provision for income taxes 4,196 1,216 6,296 1,532 Effective tax rate 2.2 % 18.0 % 2.9 % 16.5 % |
Net Income Per Share Attribut_2
Net Income Per Share Attributable to Common Stockholders (Tables) | 6 Months Ended |
Jul. 31, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of Computation of Basic and Diluted Net Income Per Share | The following table sets forth the computation of basic and diluted net income per share attributable to common stockholders for the periods presented: Three Months Ended July 31, Six Months Ended July 31, 2020 2019 2020 2019 Class A Class B Class A Class B Class A Class B Class A Class B Numerator: (in thousands, except share and per share data) Net income $ 122,474 $ 63,515 $ 751 $ 4,790 $ 125,297 $ 87,767 $ 592 $ 7,163 Less: Undistributed earnings attributable to participating securities — (247) — (20) — (305) — (2,794) Net income attributable to common stockholders, basic $ 122,474 $ 63,268 $ 751 $ 4,770 $ 125,297 $ 87,462 $ 592 $ 4,369 Reallocation of net income attributable to common stockholders (4,343) 4,343 (50) 50 (4,824) 4,824 (64) 64 Net income attributable to common stockholders, diluted $ 118,131 $ 67,611 $ 701 $ 4,820 $ 120,473 $ 92,286 $ 528 $ 4,433 Denominator: Weighted-average shares used in computing net income per share attributable to common stockholders, basic 186,505,788 96,345,017 36,950,454 234,862,687 165,718,132 115,676,769 22,908,474 169,222,036 Weighted-average shares used in computing net income per share attributable to common stockholders, diluted 188,994,684 108,167,625 37,120,969 255,064,696 167,839,216 128,569,013 22,977,562 192,797,057 Net income per share attributable to common stockholders, basic $ 0.66 $ 0.66 $ 0.02 $ 0.02 $ 0.76 $ 0.76 $ 0.03 $ 0.03 Net income per share attributable to common stockholders, diluted $ 0.63 $ 0.63 $ 0.02 $ 0.02 $ 0.72 $ 0.72 $ 0.02 $ 0.02 |
Summary of Potential Shares of Common Stock Excluded from Computation of Diluted Net Income Per Share Attributable to Common Stockholders | The potential shares of common stock that were excluded from the computation of diluted net income per share attributable to common stockholders for the periods presented because including them would have been anti-dilutive are as follows: Three Months Ended July 31, Six Months Ended July 31, 2020 2019 2020 2019 Class A Class B Class A Class B Class A Class B Class A Class B Outstanding stock options — — 116,649 — — — 59,291 — Unvested RSUs 85,596 — 153,751 — 598,728 — 78,150 — Purchase rights committed under the ESPP 35,996 — 23,509 — 18,196 — 11,949 — Total 121,592 — 293,909 — 616,924 — 149,390 — |
Summary of Business and Signi_4
Summary of Business and Significant Accounting Policies - Additional Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Apr. 30, 2020 | Oct. 31, 2019 | Jul. 31, 2020 | Jul. 31, 2019 | Jan. 31, 2020 | |
Summary Of Business And Significant Accounting Policies [Line Items] | |||||
Proceeds from employee stock sales to be remitted | $ 280,200,000 | $ 48,500,000 | |||
Payments to acquire equity securities without readily determinable fair value | $ 8,000,000 | $ 3,000,000 | |||
Unrealized gain (loss) on investments | 2,500,000 | ||||
Equity securities without readily determinable fair value, amount | 13,500,000 | $ 3,000,000 | |||
Convertible Promissory Note | Convertible Debt | |||||
Summary Of Business And Significant Accounting Policies [Line Items] | |||||
Debt instrument face amount | $ 5,000,000 | ||||
Interest rate percentage | 3.00% | ||||
Debt instrument, fair value disclosure | $ 5,000,000 |
Summary of Business and Signi_5
Summary of Business and Significant Accounting Policies - Accounts Receivable, Allowance for Credit Loss (Details) - USD ($) $ in Thousands | Jul. 31, 2020 | Jan. 31, 2020 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Accounts receivable, gross | $ 321,491 | |
Less: Allowance for credit losses | (17,500) | $ (5,150) |
Less: Allowance for returns | (8,661) | |
Accounts receivable, net | $ 295,330 |
Summary of Business and Signi_6
Summary of Business and Significant Accounting Policies - Accounts Receivable Allowance For Credit Loss Rollforward (Details) $ in Thousands | 6 Months Ended |
Jul. 31, 2020USD ($) | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | |
Beginning balance | $ 5,150 |
Provision for credit losses | 13,723 |
Write-offs | (1,373) |
Ending balance | $ 17,500 |
Revenue Recognition - Summary D
Revenue Recognition - Summary Disaggregation of Revenue by Region (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jul. 31, 2020 | Jul. 31, 2019 | Jul. 31, 2020 | Jul. 31, 2019 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 663,520 | $ 145,826 | $ 991,687 | $ 267,814 |
Percentage of revenue | 100.00% | 100.00% | 100.00% | 100.00% |
Americas | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 454,160 | $ 117,098 | $ 699,793 | $ 215,258 |
Percentage of revenue | 69.00% | 80.00% | 71.00% | 80.00% |
Asia Pacific (“APAC”) | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 81,384 | $ 12,088 | $ 111,641 | $ 22,529 |
Percentage of revenue | 12.00% | 8.00% | 11.00% | 9.00% |
Europe, Middle East, and Africa (“EMEA”) | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 127,976 | $ 16,640 | $ 180,253 | $ 30,027 |
Percentage of revenue | 19.00% | 12.00% | 18.00% | 11.00% |
Revenue Recognition - Additiona
Revenue Recognition - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jul. 31, 2020 | Jul. 31, 2019 | Jul. 31, 2020 | Jul. 31, 2019 | Jan. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |||||
Unbilled contracts receivable | $ 20.5 | $ 20.5 | $ 12.5 | ||
Revenue recognized included in deferred revenue | $ 233.5 | $ 64.6 | $ 166.4 | $ 90.7 |
Revenue Recognition - Remaining
Revenue Recognition - Remaining Performance Obligation (Details) $ in Millions | Jul. 31, 2020USD ($) |
Disaggregation of Revenue [Line Items] | |
Remaining performance obligation | $ 1,415.8 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2020-08-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation percentage | 72.00% |
Revenue remaining performance obligation, expected timing of satisfaction period | 12 months |
Billed consideration | |
Disaggregation of Revenue [Line Items] | |
Remaining performance obligation | $ 742.6 |
Unbilled consideration | |
Disaggregation of Revenue [Line Items] | |
Remaining performance obligation | $ 673.2 |
Marketable Securities - Summary
Marketable Securities - Summary of Marketable Securities (Details) - USD ($) $ in Thousands | Jul. 31, 2020 | Jan. 31, 2020 |
Marketable Securities [Line Items] | ||
Amortized Cost | $ 730,223 | $ 571,252 |
Gross Unrealized Gains | 2,845 | 869 |
Gross Unrealized Losses | (73) | (61) |
Estimated Fair Value | 732,995 | 572,060 |
Commercial paper | ||
Marketable Securities [Line Items] | ||
Amortized Cost | 6,990 | 37,894 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | 6,990 | 37,894 |
Agency bonds | ||
Marketable Securities [Line Items] | ||
Amortized Cost | 302,221 | 141,157 |
Gross Unrealized Gains | 193 | 49 |
Gross Unrealized Losses | (45) | (43) |
Estimated Fair Value | 302,369 | 141,163 |
Corporate and other debt securities | ||
Marketable Securities [Line Items] | ||
Amortized Cost | 362,539 | 320,407 |
Gross Unrealized Gains | 2,571 | 775 |
Gross Unrealized Losses | (28) | (16) |
Estimated Fair Value | 365,082 | 321,166 |
U.S. government agency securities | ||
Marketable Securities [Line Items] | ||
Amortized Cost | 43,479 | 71,794 |
Gross Unrealized Gains | 81 | 45 |
Gross Unrealized Losses | 0 | (2) |
Estimated Fair Value | 43,560 | $ 71,837 |
Treasury bills | ||
Marketable Securities [Line Items] | ||
Amortized Cost | 14,994 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | 0 | |
Estimated Fair Value | $ 14,994 |
Marketable Securities - Additio
Marketable Securities - Additional Information (Details) - USD ($) | 6 Months Ended | |
Jul. 31, 2020 | Jul. 31, 2019 | |
Investments, Debt and Equity Securities [Abstract] | ||
Debt securities, available-for-sale, realized gain (loss) | $ 0 | $ 0 |
Marketable Securities - Summa_2
Marketable Securities - Summary of Contractual Maturities of Marketable Securities (Details) - USD ($) $ in Thousands | Jul. 31, 2020 | Jan. 31, 2020 |
Investments, Debt and Equity Securities [Abstract] | ||
Less than one year | $ 400,094 | $ 315,900 |
Due in one to five years | 332,901 | 256,160 |
Total | $ 732,995 | $ 572,060 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Financial Instruments Measured at Fair Value on Recurring Basis (Details) - USD ($) $ in Thousands | Jul. 31, 2020 | Jan. 31, 2020 |
Financial Assets: | ||
Marketable securities | $ 732,995 | $ 572,060 |
Commercial paper | ||
Financial Assets: | ||
Marketable securities | 6,990 | 37,894 |
Agency bonds | ||
Financial Assets: | ||
Marketable securities | 302,369 | 141,163 |
Corporate and other debt securities | ||
Financial Assets: | ||
Marketable securities | 365,082 | 321,166 |
U.S. government agency securities | ||
Financial Assets: | ||
Marketable securities | 43,560 | 71,837 |
Fair Value, Recurring Basis | ||
Financial Assets: | ||
Cash equivalents | 157,220 | 111,479 |
Marketable securities | 732,995 | 572,060 |
Total financial assets | 897,536 | 685,940 |
Fair Value, Recurring Basis | Money market funds | ||
Financial Assets: | ||
Cash equivalents | 157,220 | 96,486 |
Fair Value, Recurring Basis | Commercial paper | ||
Financial Assets: | ||
Cash equivalents | 4,994 | |
Fair Value, Recurring Basis | Agency bonds | ||
Financial Assets: | ||
Cash equivalents | 9,999 | |
Fair Value, Recurring Basis | Commercial paper | ||
Financial Assets: | ||
Marketable securities | 6,990 | 37,894 |
Fair Value, Recurring Basis | Agency bonds | ||
Financial Assets: | ||
Marketable securities | 302,369 | 141,163 |
Fair Value, Recurring Basis | Corporate and other debt securities | ||
Financial Assets: | ||
Marketable securities | 365,082 | 321,166 |
Fair Value, Recurring Basis | U.S. government agency securities | ||
Financial Assets: | ||
Marketable securities | 43,560 | 71,837 |
Fair Value, Recurring Basis | Treasury bills | ||
Financial Assets: | ||
Marketable securities | 14,994 | |
Fair Value, Recurring Basis | Certificate of deposit included in prepaid expenses and other current assets | ||
Financial Assets: | ||
Prepaid expenses and other current assets | 100 | 100 |
Other assets, noncurrent | 2,221 | 2,301 |
Fair Value, Recurring Basis | Convertible Note included in other assets, noncurrent | ||
Financial Assets: | ||
Other assets, noncurrent | 5,000 | |
Fair Value, Recurring Basis | Fair Value, Inputs, Level 1 | ||
Financial Assets: | ||
Cash equivalents | 157,220 | 96,486 |
Marketable securities | 0 | 0 |
Total financial assets | 157,220 | 96,486 |
Fair Value, Recurring Basis | Fair Value, Inputs, Level 1 | Money market funds | ||
Financial Assets: | ||
Cash equivalents | 157,220 | 96,486 |
Fair Value, Recurring Basis | Fair Value, Inputs, Level 1 | Commercial paper | ||
Financial Assets: | ||
Cash equivalents | 0 | |
Fair Value, Recurring Basis | Fair Value, Inputs, Level 1 | Agency bonds | ||
Financial Assets: | ||
Cash equivalents | 0 | |
Fair Value, Recurring Basis | Fair Value, Inputs, Level 1 | Commercial paper | ||
Financial Assets: | ||
Marketable securities | 0 | 0 |
Fair Value, Recurring Basis | Fair Value, Inputs, Level 1 | Agency bonds | ||
Financial Assets: | ||
Marketable securities | 0 | 0 |
Fair Value, Recurring Basis | Fair Value, Inputs, Level 1 | Corporate and other debt securities | ||
Financial Assets: | ||
Marketable securities | 0 | 0 |
Fair Value, Recurring Basis | Fair Value, Inputs, Level 1 | U.S. government agency securities | ||
Financial Assets: | ||
Marketable securities | 0 | 0 |
Fair Value, Recurring Basis | Fair Value, Inputs, Level 1 | Treasury bills | ||
Financial Assets: | ||
Marketable securities | 0 | |
Fair Value, Recurring Basis | Fair Value, Inputs, Level 1 | Certificate of deposit included in prepaid expenses and other current assets | ||
Financial Assets: | ||
Prepaid expenses and other current assets | 0 | 0 |
Other assets, noncurrent | 0 | 0 |
Fair Value, Recurring Basis | Fair Value, Inputs, Level 1 | Convertible Note included in other assets, noncurrent | ||
Financial Assets: | ||
Other assets, noncurrent | 0 | |
Fair Value, Recurring Basis | Fair Value, Inputs, Level 2 | ||
Financial Assets: | ||
Cash equivalents | 0 | 14,993 |
Marketable securities | 732,995 | 572,060 |
Total financial assets | 735,316 | 589,454 |
Fair Value, Recurring Basis | Fair Value, Inputs, Level 2 | Money market funds | ||
Financial Assets: | ||
Cash equivalents | 0 | 0 |
Fair Value, Recurring Basis | Fair Value, Inputs, Level 2 | Commercial paper | ||
Financial Assets: | ||
Cash equivalents | 4,994 | |
Fair Value, Recurring Basis | Fair Value, Inputs, Level 2 | Agency bonds | ||
Financial Assets: | ||
Cash equivalents | 9,999 | |
Fair Value, Recurring Basis | Fair Value, Inputs, Level 2 | Commercial paper | ||
Financial Assets: | ||
Marketable securities | 6,990 | 37,894 |
Fair Value, Recurring Basis | Fair Value, Inputs, Level 2 | Agency bonds | ||
Financial Assets: | ||
Marketable securities | 302,369 | 141,163 |
Fair Value, Recurring Basis | Fair Value, Inputs, Level 2 | Corporate and other debt securities | ||
Financial Assets: | ||
Marketable securities | 365,082 | 321,166 |
Fair Value, Recurring Basis | Fair Value, Inputs, Level 2 | U.S. government agency securities | ||
Financial Assets: | ||
Marketable securities | 43,560 | 71,837 |
Fair Value, Recurring Basis | Fair Value, Inputs, Level 2 | Treasury bills | ||
Financial Assets: | ||
Marketable securities | 14,994 | |
Fair Value, Recurring Basis | Fair Value, Inputs, Level 2 | Certificate of deposit included in prepaid expenses and other current assets | ||
Financial Assets: | ||
Prepaid expenses and other current assets | 100 | 100 |
Other assets, noncurrent | 2,221 | 2,301 |
Fair Value, Recurring Basis | Fair Value, Inputs, Level 2 | Convertible Note included in other assets, noncurrent | ||
Financial Assets: | ||
Other assets, noncurrent | 0 | |
Fair Value, Recurring Basis | Fair Value, Inputs, Level 3 | ||
Financial Assets: | ||
Cash equivalents | 0 | 0 |
Marketable securities | 0 | 0 |
Total financial assets | 5,000 | 0 |
Fair Value, Recurring Basis | Fair Value, Inputs, Level 3 | Money market funds | ||
Financial Assets: | ||
Cash equivalents | 0 | 0 |
Fair Value, Recurring Basis | Fair Value, Inputs, Level 3 | Commercial paper | ||
Financial Assets: | ||
Cash equivalents | 0 | |
Fair Value, Recurring Basis | Fair Value, Inputs, Level 3 | Agency bonds | ||
Financial Assets: | ||
Cash equivalents | 0 | |
Fair Value, Recurring Basis | Fair Value, Inputs, Level 3 | Commercial paper | ||
Financial Assets: | ||
Marketable securities | 0 | 0 |
Fair Value, Recurring Basis | Fair Value, Inputs, Level 3 | Agency bonds | ||
Financial Assets: | ||
Marketable securities | 0 | 0 |
Fair Value, Recurring Basis | Fair Value, Inputs, Level 3 | Corporate and other debt securities | ||
Financial Assets: | ||
Marketable securities | 0 | 0 |
Fair Value, Recurring Basis | Fair Value, Inputs, Level 3 | U.S. government agency securities | ||
Financial Assets: | ||
Marketable securities | 0 | 0 |
Fair Value, Recurring Basis | Fair Value, Inputs, Level 3 | Treasury bills | ||
Financial Assets: | ||
Marketable securities | 0 | |
Fair Value, Recurring Basis | Fair Value, Inputs, Level 3 | Certificate of deposit included in prepaid expenses and other current assets | ||
Financial Assets: | ||
Prepaid expenses and other current assets | 0 | 0 |
Other assets, noncurrent | 0 | $ 0 |
Fair Value, Recurring Basis | Fair Value, Inputs, Level 3 | Convertible Note included in other assets, noncurrent | ||
Financial Assets: | ||
Other assets, noncurrent | $ 5,000 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) - USD ($) $ in Millions | Jul. 31, 2020 | Jan. 31, 2020 |
Fair Value Disclosures [Abstract] | ||
Equity securities without readily determinable fair value, amount | $ 13.5 | $ 3 |
Business Combinations (Details)
Business Combinations (Details) - USD ($) $ in Thousands | Jul. 31, 2020 | May 07, 2020 | Jul. 31, 2020 | Jan. 31, 2020 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 24,340 | $ 24,340 | $ 0 | |
Minimum | ||||
Business Acquisition [Line Items] | ||||
Holdback agreements, service period | 1 year | |||
Maximum | ||||
Business Acquisition [Line Items] | ||||
Holdback agreements, service period | 3 years | |||
Keybase | ||||
Business Acquisition [Line Items] | ||||
Business acquisition, percentage of voting interests acquired | 100.00% | |||
Payments to acquire businesses, gross | $ 42,900 | |||
Goodwill | 24,300 | |||
Intangible assets, other than goodwill | 3,300 | |||
Business combination, current assets, other | 15,300 | |||
Business combination, cash and equivalents | $ 16,400 | |||
Acquired finite-lived intangible assets, weighted average useful life | 4 years 9 months 18 days | 5 years | ||
Holdback agreements related to employees | $ 20,000 |
Balance Sheet Components - Prep
Balance Sheet Components - Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands | Jul. 31, 2020 | Jan. 31, 2020 |
Balance Sheet Components [Abstract] | ||
Restricted cash from international employee stock sales | $ 280,209 | $ 48,547 |
Prepaid expenses | 54,854 | 22,320 |
Other | 8,225 | 4,141 |
Prepaid expenses and other current assets | $ 343,288 | $ 75,008 |
Balance Sheet Components - Sche
Balance Sheet Components - Schedule of Property and Equipment Net (Details) - USD ($) $ in Thousands | Jul. 31, 2020 | Jan. 31, 2020 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 127,983 | $ 84,394 |
Less: accumulated depreciation and amortization | (36,692) | (27,256) |
Property, Plant and Equipment, Net, Total | 91,291 | 57,138 |
Computer and Office Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 82,783 | 51,375 |
Software | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 21,452 | 10,855 |
Leasehold Improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 19,812 | 18,215 |
Furniture and Fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 3,936 | $ 3,949 |
Balance Sheet Components - Addi
Balance Sheet Components - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 31, 2020 | Jul. 31, 2019 | Jul. 31, 2020 | Jul. 31, 2019 | |
Balance Sheet Components [Abstract] | ||||
Depreciation and amortization expense | $ 6.4 | $ 3.8 | $ 11.7 | $ 7.2 |
Balance Sheet Components - Othe
Balance Sheet Components - Other Noncurrent Assets (Details) - USD ($) $ in Thousands | Jul. 31, 2020 | Jan. 31, 2020 |
Balance Sheet Components [Abstract] | ||
Accounts receivable, noncurrent | $ 22,950 | $ 9,011 |
Equity investment | 13,538 | 3,000 |
Convertible Note | 5,000 | 0 |
Prepaid expenses, noncurrent | 4,693 | 2,945 |
Indefinite-lived intangible assets | 3,654 | 2,159 |
Intangible assets subject to amortization, net | 3,146 | 0 |
Other | 6,337 | 5,217 |
Other assets, noncurrent | $ 59,318 | $ 22,332 |
Balance Sheet Components - Sc_2
Balance Sheet Components - Schedule of Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands | Jul. 31, 2020 | Jan. 31, 2020 |
Balance Sheet Components [Abstract] | ||
Proceeds from employee equity transactions to be remitted to employees and tax authorities | $ 284,550 | $ 49,287 |
Accrued compensation and benefits | 133,629 | 36,732 |
Accrued expenses | 87,492 | 17,475 |
Sales and other tax liabilities | 22,998 | 3,774 |
Operating lease liabilities, current | 9,667 | 7,675 |
Customer deposits liabilities | 9,582 | 3,414 |
Other | 12,270 | 4,335 |
Accrued expenses and other current liabilities | $ 560,188 | $ 122,692 |
Balance Sheet Components - Sc_3
Balance Sheet Components - Schedule of Other Liabilities Non Current (Details) - USD ($) $ in Thousands | Jul. 31, 2020 | Jan. 31, 2020 |
Balance Sheet Components [Abstract] | ||
Sales and other tax liabilities | $ 44,388 | $ 33,957 |
Other | 3,220 | 2,329 |
Other liabilities, non-current | $ 47,608 | $ 36,286 |
Commitments and Contingencies (
Commitments and Contingencies (Details) $ in Millions | Jul. 30, 2020officer | Jun. 11, 2020officer | Apr. 08, 2020officer | May 31, 2020USD ($) | Jul. 31, 2020USD ($) |
Other Commitments [Line Items] | |||||
Purchase obligation | $ 25.8 | ||||
Lessee, operating lease, lease not yet commenced, future lease payments | 8.9 | ||||
Payments for royalties | $ 9.8 | 2.9 | |||
Payments for legal settlements | $ 9.8 | ||||
Violation Of Securities Act Section 10(b), 20(a), and Rule 10b-5 | |||||
Other Commitments [Line Items] | |||||
Loss contingency, number of defendants | officer | 8 | 9 | 2 |
Stockholders_ Equity and Equi_3
Stockholders’ Equity and Equity Incentive Plans - Additional Information (Details) | Jul. 31, 2020USD ($)$ / sharesshares | Apr. 30, 2019USD ($)shares | Jul. 31, 2020USD ($)$ / sharesshares | Jul. 31, 2019shares | Jul. 31, 2020USD ($)$ / sharesshares | Jul. 31, 2019shares | Jan. 31, 2020USD ($)$ / sharesshares | Apr. 30, 2020dates |
Class of Stock [Line Items] | ||||||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | $ 0.001 | $ 0.001 | ||||
Stock options outstanding (in shares) | 11,869,518 | 11,869,518 | 11,869,518 | 16,833,009 | ||||
Unrecognized stock-based compensation expenses related to outstanding unvested stock options | $ | $ 61,500,000 | $ 61,500,000 | $ 61,500,000 | |||||
Number of offering dates | dates | 4 | |||||||
Proceeds from unvested shares of common stock | $ | 900,000 | $ 1,200,000 | ||||||
RSUs | ||||||||
Class of Stock [Line Items] | ||||||||
Unrecognized stock-based compensation excepted to be recognized over a weighted-average period | 3 years | |||||||
Unrecognized stock-based compensation expenses | $ | $ 619,300,000 | 619,300,000 | $ 619,300,000 | |||||
Shares vested on the grant date (in shares) | 166,366 | |||||||
Employee Stock Purchase Plan | ||||||||
Class of Stock [Line Items] | ||||||||
Unrecognized stock-based compensation excepted to be recognized over a weighted-average period | 10 months 24 days | |||||||
Unrecognized stock-based compensation expenses | $ | $ 56,000,000 | $ 56,000,000 | $ 56,000,000 | |||||
Maximum number of shares per employee (in shares) | 3,000 | |||||||
Consecutive offering period | 27 months | |||||||
Share-based Payment Arrangement, Option | ||||||||
Class of Stock [Line Items] | ||||||||
Unrecognized stock-based compensation excepted to be recognized over a weighted-average period | 2 years 3 months 18 days | |||||||
2011 Plan | ||||||||
Class of Stock [Line Items] | ||||||||
Number of shares available for future issuance (in shares) | 24,300,889 | 24,300,889 | 24,300,889 | |||||
2019 Plan | ||||||||
Class of Stock [Line Items] | ||||||||
Percentage of shares reserved increase | 5.00% | 5.00% | 5.00% | |||||
2019 Employee Stock Purchase Plan | Employee Stock Purchase Plan | ||||||||
Class of Stock [Line Items] | ||||||||
Annual increase in shares for available for future issuance by percentage of the outstanding ordinary shares on the first day of such fiscal year. | 1.00% | |||||||
Annual increase in Number of shares of common stock available for future issuance | 7,500,000 | |||||||
Class A Common Stock | ||||||||
Class of Stock [Line Items] | ||||||||
Common stock, shares authorized (in shares) | 2,000,000,000 | 2,000,000,000 | 2,000,000,000 | 2,000,000,000 | ||||
Common stock, capital shares reserved for future issuance, charitable donation (in shares) | 94,844 | 500,000 | ||||||
Antidilutive securities excluded from computation of earnings per share, amount | 405,156 | 121,592 | 293,909 | 616,924 | 149,390 | |||
Class A Common Stock | Held For Charitable Contributions | ||||||||
Class of Stock [Line Items] | ||||||||
Antidilutive securities excluded from computation of earnings per share, amount | 23,300,000 | |||||||
Class A Common Stock | Employee Stock Purchase Plan | ||||||||
Class of Stock [Line Items] | ||||||||
Percentage of purchase price of common stock to fair market value of common stock on offering or purchase date | 85.00% | |||||||
ESPP excess rate purchase right, value | $ | $ 25,000 | |||||||
Shares issued of common stock (in shares) | 1,096,192 | |||||||
Class A Common Stock | 2019 Plan | ||||||||
Class of Stock [Line Items] | ||||||||
Number of shares available for future issuance (in shares) | 58,300,889 | 58,300,889 | 58,300,889 | |||||
Numbers of additional shares authorized under the plan (in shares) | 34,000,000 | |||||||
Class A Common Stock | 2019 Employee Stock Purchase Plan | Employee Stock Purchase Plan | ||||||||
Class of Stock [Line Items] | ||||||||
Number of shares available for future issuance (in shares) | 9,000,000 | |||||||
Class A Common Stock | Initial public offering | ||||||||
Class of Stock [Line Items] | ||||||||
Common stock, shares authorized (in shares) | 2,000,000,000 | 2,000,000,000 | 2,000,000,000 | |||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | $ 0.001 | |||||
Class B Common Stock | ||||||||
Class of Stock [Line Items] | ||||||||
Common stock, shares authorized (in shares) | 300,000,000 | 300,000,000 | 300,000,000 | 300,000,000 | ||||
Number of common stock subject to repurchase (in shares) | 354,087 | 466,819 | ||||||
Weighted average price per share (in dollars per share) | $ / shares | $ 2.65 | $ 2.65 | $ 2.65 | $ 2.58 | ||||
Antidilutive securities excluded from computation of earnings per share, amount | 0 | 0 | 0 | |||||
Class B Common Stock | Initial public offering | ||||||||
Class of Stock [Line Items] | ||||||||
Common stock, shares authorized (in shares) | 300,000,000 | 300,000,000 | 300,000,000 | |||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | $ 0.001 |
Stockholders_ Equity and Equi_4
Stockholders’ Equity and Equity Incentive Plans - Summary of Stock Option Activity Under Equity Incentive Plan (Details) $ / shares in Units, $ in Thousands | 6 Months Ended | 12 Months Ended |
Jul. 31, 2020USD ($)$ / sharesshares | Jan. 31, 2020USD ($)$ / sharesshares | |
Outstanding Stock Options | ||
Beginning balance (in shares) | shares | 16,833,009 | |
Granted (in shares) | shares | 0 | |
Exercised (in shares) | shares | (4,830,752) | |
Cancelled/forfeited/expired (in shares) | shares | (132,739) | |
Ending balance (in shares) | shares | 11,869,518 | 16,833,009 |
Weighted- Average Exercise Price | ||
Beginning balance (in dollars per share) | $ / shares | $ 5.73 | |
Granted (in dollars per share) | $ / shares | 0 | |
Exercised (in dollars per share) | $ / shares | 3.61 | |
Cancelled/forfeited/expired (in dollars per share) | $ / shares | 5.92 | |
Ending balance (in dollars per share) | $ / shares | $ 6.59 | $ 5.73 |
Weighted- Average Remaining Contractual Life (Years) | 7 years 4 months 24 days | 7 years 7 months 6 days |
Options outstanding, aggregate intrinsic value | $ | $ 2,935,477 | $ 1,191,881 |
Outstanding stock options, vested and exercisable (in shares) | shares | 5,021,067 | |
Weighted average exercise price, vested and exercisable (in shares) | $ / shares | $ 3.28 | |
Weighted-average remaining contractual life (years), vested and exercisable | 6 years 9 months 18 days | |
Options outstanding, aggregate intrinsic value, vested and exercisable | $ | $ 1,258,445 |
Stockholders_ Equity and Equi_5
Stockholders’ Equity and Equity Incentive Plans - Summary of Restricted Stock Units Activity Under Equity Incentive Plan (Details) - RSUs | 6 Months Ended |
Jul. 31, 2020$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |
Beginning balance (in units) | shares | 1,964,668 |
Granted (in units) | shares | 2,617,599 |
Vested (in shares) | shares | (166,366) |
Cancelled/forfeited (in units) | shares | (45,290) |
Ending balance (in units) | shares | 4,370,611 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |
Beginning balance (in dollars per unit) | $ / shares | $ 79.11 |
Granted (in dollars per unit) | $ / shares | 202.30 |
Vested (in dollars per unit) | $ / shares | 88.53 |
Cancelled/forfeited (in dollars per unit) | $ / shares | 98.34 |
Ending balance (in dollars per unit) | $ / shares | $ 152.33 |
Stockholders_ Equity and Equi_6
Stockholders’ Equity and Equity Incentive Plans - Summary of Stock-based Compensation Expense by Line Item (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jul. 31, 2020 | Jul. 31, 2019 | Jul. 31, 2020 | Jul. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Stock-based compensation expense | $ 56,855 | $ 18,075 | $ 85,632 | $ 24,737 |
Cost of revenue | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Stock-based compensation expense | 7,727 | 1,902 | 10,976 | 2,732 |
Research and development | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Stock-based compensation expense | 10,010 | 2,510 | 15,234 | 3,674 |
Sales and marketing | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Stock-based compensation expense | 32,398 | 10,439 | 49,521 | 13,066 |
General and administrative | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Stock-based compensation expense | $ 6,720 | $ 3,224 | $ 9,901 | $ 5,265 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jul. 31, 2020 | Jul. 31, 2019 | Jul. 31, 2020 | Jul. 31, 2019 | |
Income Tax Disclosure [Abstract] | ||||
Net income before provision for income taxes | $ 190,185 | $ 6,757 | $ 219,360 | $ 9,287 |
Provision for income taxes | $ 4,196 | $ 1,216 | $ 6,296 | $ 1,532 |
Effective tax rate | 2.20% | 18.00% | 2.90% | 16.50% |
Net Income Per Share Attribut_3
Net Income Per Share Attributable to Common Stockholders - Schedule of Computation of Basic and Diluted Net Income Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jul. 31, 2020 | Jul. 31, 2019 | Jul. 31, 2020 | Jul. 31, 2019 | |
Numerator: | ||||
Net income (loss) | $ 185,989 | $ 5,541 | $ 213,064 | $ 7,755 |
Net income attributable to common stockholders | $ 185,742 | $ 5,521 | $ 212,759 | $ 4,961 |
Denominator: | ||||
Weighted-average shares used in computing net income per share attributable to common stockholders, basic (in shares) | 282,850,805 | 271,813,141 | 281,394,901 | 192,130,510 |
Weighted-average shares used in computing net income per share attributable to common stockholders, diluted (in shares) | 297,162,309 | 292,185,665 | 296,408,229 | 215,774,619 |
Net income per share attributable to common stockholders, basic (in dollars per share) | $ 0.66 | $ 0.02 | $ 0.76 | $ 0.03 |
Net income per share attributable to common stockholders, diluted (in dollars per share) | $ 0.63 | $ 0.02 | $ 0.72 | $ 0.02 |
Class A Common Stock | ||||
Numerator: | ||||
Net income (loss) | $ 122,474 | $ 751 | $ 125,297 | $ 592 |
Less: undistributed earnings attributable to participating securities | 0 | 0 | 0 | 0 |
Net income attributable to common stockholders | 122,474 | 751 | 125,297 | 592 |
Reallocation of net income attributable to common stockholders | (4,343) | (50) | (4,824) | (64) |
Net income (loss) attributable to common stockholders, diluted | $ 118,131 | $ 701 | $ 120,473 | $ 528 |
Denominator: | ||||
Weighted-average shares used in computing net income per share attributable to common stockholders, basic (in shares) | 186,505,788 | 36,950,454 | 165,718,132 | 22,908,474 |
Weighted-average shares used in computing net income per share attributable to common stockholders, diluted (in shares) | 188,994,684 | 37,120,969 | 167,839,216 | 22,977,562 |
Net income per share attributable to common stockholders, basic (in dollars per share) | $ 0.66 | $ 0.02 | $ 0.76 | $ 0.03 |
Net income per share attributable to common stockholders, diluted (in dollars per share) | $ 0.63 | $ 0.02 | $ 0.72 | $ 0.02 |
Class B Common Stock | ||||
Numerator: | ||||
Net income (loss) | $ 63,515 | $ 4,790 | $ 87,767 | $ 7,163 |
Less: undistributed earnings attributable to participating securities | (247) | (20) | (305) | (2,794) |
Net income attributable to common stockholders | 63,268 | 4,770 | 87,462 | 4,369 |
Reallocation of net income attributable to common stockholders | 4,343 | 50 | 4,824 | 64 |
Net income (loss) attributable to common stockholders, diluted | $ 67,611 | $ 4,820 | $ 92,286 | $ 4,433 |
Denominator: | ||||
Weighted-average shares used in computing net income per share attributable to common stockholders, basic (in shares) | 96,345,017 | 234,862,687 | 115,676,769 | 169,222,036 |
Weighted-average shares used in computing net income per share attributable to common stockholders, diluted (in shares) | 108,167,625 | 255,064,696 | 128,569,013 | 192,797,057 |
Net income per share attributable to common stockholders, basic (in dollars per share) | $ 0.66 | $ 0.02 | $ 0.76 | $ 0.03 |
Net income per share attributable to common stockholders, diluted (in dollars per share) | $ 0.63 | $ 0.02 | $ 0.72 | $ 0.02 |
Net Income Per Share Attribut_4
Net Income Per Share Attributable to Common Stockholders - Summary of Potential Shares of Common Stock Excluded from Computation of Diluted Net Income Per Share Attributable to Common Stockholders (Details) - shares | Jul. 31, 2020 | Jul. 31, 2020 | Jul. 31, 2019 | Jul. 31, 2020 | Jul. 31, 2019 |
Class A Common Stock | |||||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||||
Antidilutive securities excluded from computation of earnings per share, amount | 405,156 | 121,592 | 293,909 | 616,924 | 149,390 |
Class B Common Stock | |||||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||||
Antidilutive securities excluded from computation of earnings per share, amount | 0 | 0 | 0 | ||
Outstanding stock options | Class A Common Stock | |||||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||||
Antidilutive securities excluded from computation of earnings per share, amount | 0 | 116,649 | 0 | 59,291 | |
Outstanding stock options | Class B Common Stock | |||||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||||
Antidilutive securities excluded from computation of earnings per share, amount | 0 | 0 | 0 | 0 | |
Unvested RSUs | Class A Common Stock | |||||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||||
Antidilutive securities excluded from computation of earnings per share, amount | 85,596 | 153,751 | 598,728 | 78,150 | |
Unvested RSUs | Class B Common Stock | |||||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||||
Antidilutive securities excluded from computation of earnings per share, amount | 0 | 0 | 0 | 0 | |
Purchase rights committed under the ESPP | Class A Common Stock | |||||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||||
Antidilutive securities excluded from computation of earnings per share, amount | 35,996 | 23,509 | 18,196 | 11,949 | |
Purchase rights committed under the ESPP | Class B Common Stock | |||||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||||
Antidilutive securities excluded from computation of earnings per share, amount | 0 | 0 | 0 | 0 |
Uncategorized Items - zm-202007
Label | Element | Value |
Restricted Cash and Cash Equivalents, Current | us-gaap_RestrictedCashAndCashEquivalentsAtCarryingValue | $ 100,000 |
Restricted Cash and Cash Equivalents, Current | us-gaap_RestrictedCashAndCashEquivalentsAtCarryingValue | 280,309,000 |
Restricted Cash and Cash Equivalents, Noncurrent | us-gaap_RestrictedCashAndCashEquivalentsNoncurrent | 2,044,000 |
Restricted Cash and Cash Equivalents, Noncurrent | us-gaap_RestrictedCashAndCashEquivalentsNoncurrent | $ 2,221,000 |