Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Jul. 31, 2018 | Aug. 31, 2018 | Mar. 16, 2018 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | Zscaler, Inc. | ||
Entity Central Index Key | 1,713,683 | ||
Current Fiscal Year End Date | --07-31 | ||
Entity Filer Category | Non-accelerated Filer | ||
Document Type | 10-K | ||
Document Period End Date | Jul. 31, 2018 | ||
Document Fiscal Year Focus | 2,018 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $ 1,500,000,000 | ||
Shares Outstanding | 119,773,132 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Jul. 31, 2018 | Jul. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 135,579 | $ 87,978 |
Total short-term investments | 162,960 | 0 |
Accounts receivable, net | 61,611 | 39,052 |
Deferred contract acquisition costs | 16,136 | 10,469 |
Prepaid expenses and other current assets | 10,878 | 5,410 |
Total current assets | 387,164 | 142,909 |
Property and equipment, net | 19,765 | 13,139 |
Deferred contract acquisition costs, noncurrent | 39,774 | 24,193 |
Other noncurrent assets | 1,078 | 2,661 |
Total assets | 447,781 | 182,902 |
Current liabilities: | ||
Accounts payable | 4,895 | 3,763 |
Accrued expenses and other current liabilities | 12,313 | 11,648 |
Accrued compensation | 23,393 | 11,608 |
Liability for early exercised stock options | 1,561 | 7,972 |
Deferred revenue | 140,670 | 85,468 |
Total current liabilities | 182,832 | 120,459 |
Deferred revenue, noncurrent | 23,353 | 11,151 |
Other noncurrent liabilities | 1,360 | 1,457 |
Total liabilities | 207,545 | 133,067 |
Commitments and contingencies (Note 5) | ||
Redeemable Convertible Preferred Stock | ||
Redeemable convertible preferred stock; $0.001 par value; no shares and 73,100 shares authorized as of July 31, 2018 and 2017, respectively; no shares and 72,501 shares issued and outstanding as of July 31, 2018 and 2017, respectively; aggregate liquidation preference of $0 and $201,376 as of July 31, 2018 and 2017, respectively | 0 | 200,977 |
Stockholders’ Equity (Deficit) | ||
Preferred stock; $0.001 par value; 200,000 and 73,100 shares authorized as of July 31, 2018 and 2017, respectively; no shares issued and outstanding as of July 31, 2018 and 2017 | 0 | 0 |
Common stock; $0.001 par value; 1,000,000 and 130,000 shares authorized as of July 31, 2018 and 2017, respectively; 119,764 and 32,359 shares issued and outstanding as of July 31, 2018 and 2017, respectively | 119 | 18 |
Additional paid-in capital | 438,392 | 18,734 |
Notes receivable from stockholders | (2,051) | (7,878) |
Accumulated other comprehensive loss | (124) | 0 |
Accumulated deficit | (196,100) | (162,016) |
Total stockholders’ equity (deficit) | 240,236 | (151,142) |
Total liabilities, redeemable convertible preferred stock and stockholders’ equity (deficit) | $ 447,781 | $ 182,902 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Jul. 31, 2018 | Jul. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Redeemable convertible preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Redeemable convertible preferred stock, shares authorized (in shares) | 0 | 73,100,000 |
Redeemable convertible preferred stock, shares issued (in shares) | 0 | 72,501,000 |
Redeemable convertible preferred stock, shares outstanding (in shares) | 0 | 72,501,000 |
Redeemable convertible preferred stock, aggregate liquidation price | $ 0 | $ 201,376 |
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 200,000,000 | 73,100,000 |
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 |
Common stock, shares authorized (in shares) | 1,000,000,000 | 130,000,000 |
Common stock, shares issued (in shares) | 119,764,000 | 32,359,000 |
Common stock, shares outstanding (in shares) | 119,764,000 | 32,359,000 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | ||
Jul. 31, 2018 | Jul. 31, 2017 | Jul. 31, 2016 | |
Income Statement [Abstract] | |||
Revenue | $ 190,174 | $ 125,717 | $ 80,325 |
Cost of revenue | 37,875 | 27,472 | 20,127 |
Gross profit | 152,299 | 98,245 | 60,198 |
Operating expenses: | |||
Sales and marketing | 116,409 | 79,236 | 56,702 |
Research and development | 39,379 | 33,561 | 20,940 |
General and administrative | 31,135 | 20,521 | 9,399 |
Total operating expenses | 186,923 | 133,318 | 87,041 |
Loss from operations | (34,624) | (35,073) | (26,843) |
Interest income, net | 2,236 | 597 | 289 |
Other income (expense), net | 79 | (107) | (416) |
Loss before income taxes | (32,309) | (34,583) | (26,970) |
Provision for income taxes | 1,337 | 877 | 468 |
Net loss | (33,646) | (35,460) | (27,438) |
Accretion of Series C and D redeemable convertible preferred stock | (6,332) | (9,570) | (8,648) |
Net loss attributable to common stockholders | $ (39,978) | $ (45,030) | $ (36,086) |
Net loss per share attributable to common stockholders, basic and diluted (in dollars per share) | $ (0.63) | $ (1.54) | $ (1.36) |
Weighted-average shares used in computing net loss per share attributable to common stockholders, basic and diluted (in shares) | 63,881,000 | 29,221,000 | 26,521,000 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | ||
Jul. 31, 2018 | Jul. 31, 2017 | Jul. 31, 2016 | |
Statement of Comprehensive Income [Abstract] | |||
Net loss | $ (33,646) | $ (35,460) | $ (27,438) |
Other comprehensive loss, net of tax: | |||
Unrealized net losses on available-for-sale securities | (124) | 0 | 0 |
Other comprehensive loss | (124) | 0 | 0 |
Comprehensive loss | $ (33,770) | $ (35,460) | $ (27,438) |
Consolidated Statements of Rede
Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders' Equity (Deficit) - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Notes Receivable From Stockholders | Accumulated Other Comprehensive Loss | Accumulated Deficit |
Redeemable convertible preferred stock, beginning balance (in shares) at Jul. 31, 2015 | 69,712,000 | |||||
Redeemable convertible preferred stock, beginning balance at Jul. 31, 2015 | $ 157,802 | |||||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||
Issuance of preferred stock, net of issuance costs of $43 (in shares) | 2,789,000 | |||||
Issuance of preferred stock, net of issuance costs of $43 | $ 24,957 | |||||
Accretion of Series C and D redeemable convertible preferred stock | $ 8,648 | |||||
Redeemable convertible preferred stock, ending balance (in shares) at Jul. 31, 2016 | 72,501,000 | |||||
Redeemable convertible preferred stock, ending balance at Jul. 31, 2016 | $ 191,407 | |||||
Common stock, beginning balance (in shares) at Jul. 31, 2015 | 29,474,000 | |||||
Beginning balance at Jul. 31, 2015 | (95,332) | $ 13 | $ 12,895 | $ (9,122) | $ 0 | $ (99,118) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Accretion of Series C and D redeemable convertible preferred stock | (8,648) | (8,648) | ||||
Issuance of common stock upon exercise of stock options (in shares) | 848,000 | |||||
Issuance of common stock upon exercise of stock options | 991 | $ 1 | 990 | |||
Issuance of common stock related to early exercised stock options (in shares) | 1,260,000 | |||||
Issuance of common stock related to early exercised stock options | 0 | |||||
Repurchases of unvested common stock (in shares) | (1,251,000) | |||||
Repurchases of unvested common stock | 2,931 | 2,931 | ||||
Repayments of notes receivable from stockholders | 833 | 833 | ||||
Accrued interest on notes receivable from stockholders, net of repayments | (4,556) | (4,556) | ||||
Vesting of early exercised stock options | 2,862 | $ 2 | 2,860 | |||
Stock-based compensation | 3,617 | 3,617 | ||||
Net loss | (27,438) | (27,438) | ||||
Common stock, ending balance (in shares) at Jul. 31, 2016 | 30,331,000 | |||||
Ending balance at Jul. 31, 2016 | (124,740) | $ 16 | 11,714 | (9,914) | 0 | (126,556) |
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||
Accretion of Series C and D redeemable convertible preferred stock | $ 9,570 | |||||
Redeemable convertible preferred stock, ending balance (in shares) at Jul. 31, 2017 | 72,501,000 | |||||
Redeemable convertible preferred stock, ending balance at Jul. 31, 2017 | $ 200,977 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Accretion of Series C and D redeemable convertible preferred stock | (9,570) | (9,570) | ||||
Issuance of common stock upon exercise of stock options (in shares) | 1,347,000 | |||||
Issuance of common stock upon exercise of stock options | 2,971 | $ 1 | 2,970 | |||
Issuance of common stock related to early exercised stock options (in shares) | 781,000 | |||||
Issuance of common stock related to early exercised stock options | 0 | |||||
Repurchases of unvested common stock (in shares) | (100,000) | |||||
Repurchases of unvested common stock | 263 | 263 | ||||
Repayments of notes receivable from stockholders | 1,856 | 1,856 | ||||
Accrued interest on notes receivable from stockholders, net of repayments | (83) | (83) | ||||
Vesting of early exercised stock options | 3,702 | $ 1 | 3,701 | |||
Stock-based compensation | 9,919 | 9,919 | ||||
Net loss | $ (35,460) | (35,460) | ||||
Common stock, ending balance (in shares) at Jul. 31, 2017 | 32,359,000 | 32,359,000 | ||||
Ending balance at Jul. 31, 2017 | $ (151,142) | $ 18 | 18,734 | (7,878) | 0 | (162,016) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Cumulative effect of accounting change | 0 | 438 | (438) | |||
Accretion of Series C and D redeemable convertible preferred stock | $ 6,332 | |||||
Conversion of redeemable convertible preferred stock to common stock upon initial public offering (in shares) | (72,501,000) | |||||
Conversion of redeemable convertible preferred stock to common stock upon initial public offering | $ (207,309) | |||||
Redeemable convertible preferred stock, ending balance (in shares) at Jul. 31, 2018 | 0 | |||||
Redeemable convertible preferred stock, ending balance at Jul. 31, 2018 | $ 0 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Accretion of Series C and D redeemable convertible preferred stock | $ (6,332) | (6,332) | ||||
Issuance of common stock upon exercise of stock options (in shares) | 1,892,000 | 1,712,000 | ||||
Issuance of common stock upon exercise of stock options | $ 4,985 | $ 2 | 4,983 | |||
Issuance of common stock related to early exercised stock options (in shares) | 180,000 | |||||
Issuance of common stock related to early exercised stock options | 0 | |||||
Repurchases of unvested common stock (in shares) | (788,000) | |||||
Repurchases of unvested common stock | 214 | 214 | ||||
Repayments of notes receivable from stockholders | 5,346 | 5,346 | ||||
Accrued interest on notes receivable from stockholders, net of repayments | 267 | 267 | ||||
Vesting of early exercised stock options | 3,255 | $ 12 | 3,243 | |||
Issuance of common stock upon initial public offering, net of underwriting discounts and issuance costs (in shares) | 13,800,000 | |||||
Issuance of common stock upon initial public offering, net of underwriting discounts of $15,456 and issuance costs of $6,464 | 198,880 | $ 14 | 198,866 | |||
Conversion of redeemable convertible preferred stock to common stock upon initial public offering (in shares) | 72,501,000 | |||||
Conversion of redeemable convertible preferred stock to common stock upon initial public offering | 207,309 | $ 73 | 207,236 | |||
Stock-based compensation | 11,224 | 11,224 | ||||
Other comprehensive loss | (124) | (124) | ||||
Net loss | $ (33,646) | (33,646) | ||||
Common stock, ending balance (in shares) at Jul. 31, 2018 | 119,764,000 | 119,764,000 | ||||
Ending balance at Jul. 31, 2018 | $ 240,236 | $ 119 | $ 438,392 | $ (2,051) | $ (124) | $ (196,100) |
Consolidated Statements of Red7
Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders' Equity (Deficit) (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | |
Jul. 31, 2018 | Jul. 31, 2016 | |
Payments of stock issuance costs | $ 4,336 | $ 0 |
Payments for Underwriting Expense | 15,456 | |
Preferred Stock | ||
Payments of stock issuance costs | $ 43 | |
Common Stock | ||
Payments of stock issuance costs | $ 6,464 |
Consolidated Statement of Cash
Consolidated Statement of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Jul. 31, 2018 | Jul. 31, 2017 | Jul. 31, 2016 | |
Cash Flows From Operating Activities | |||
Net loss | $ (33,646) | $ (35,460) | $ (27,438) |
Adjustments to reconcile net loss to cash provided by (used in) operating activities: | |||
Depreciation and amortization expense | 7,988 | 6,840 | 4,872 |
Amortization of deferred contract acquisition costs | 13,181 | 8,474 | 5,515 |
Stock-based compensation expense | 11,224 | 9,919 | 3,617 |
Other | 130 | (89) | (59) |
Changes in operating assets and liabilities: | |||
Accounts receivable | (22,559) | (14,563) | (6,188) |
Deferred contract acquisition costs | (34,429) | (21,999) | (13,502) |
Prepaid expenses and other assets | (5,068) | (2,718) | (115) |
Accounts payable | (779) | 2,249 | 563 |
Accrued expenses and other liabilities | 2,076 | 5,376 | 2,085 |
Accrued compensation | 11,785 | 5,246 | 2,601 |
Deferred revenue | 67,404 | 30,706 | 16,133 |
Net cash provided by (used in) operating activities | 17,307 | (6,019) | (11,916) |
Cash Flows From Investing Activities | |||
Purchases of property and equipment | (13,397) | (7,783) | (5,402) |
Capitalized internal-use software | (1,773) | (391) | (845) |
Change in restricted cash | 0 | (168) | (400) |
Purchases of short-term investments | (163,366) | 0 | 0 |
Other | 433 | 0 | 0 |
Net cash used in investing activities | (178,103) | (8,342) | (6,647) |
Cash Flows From Financing Activities | |||
Proceeds from initial public offering, net of underwriting discounts and commissions | 205,344 | 0 | 0 |
Payments of costs related to initial public offering | (4,336) | (31) | 0 |
Proceeds from issuance of preferred stock, net of issuance costs | 0 | 0 | 24,957 |
Proceeds from issuance of common stock upon exercise of stock options | 4,985 | 2,971 | 991 |
Proceeds from issuance of common stock related to early exercised stock options | 869 | 4,701 | 782 |
Repurchases of unvested common stock | (3,811) | 0 | 0 |
Repayments of notes receivable from stockholders | 5,346 | 1,856 | 833 |
Net cash provided by financing activities | 208,397 | 9,497 | 27,563 |
Net increase (decrease) in cash and cash equivalents | 47,601 | (4,864) | 9,000 |
Cash and cash equivalents, beginning of period | 87,978 | 92,842 | 83,842 |
Cash and cash equivalents, end of period | 135,579 | 87,978 | 92,842 |
Supplemental Disclosure of Cash Flow Information: | |||
Cash paid for income taxes | 870 | 385 | 319 |
Supplemental Disclosure of Noncash Investing and Financing Activities: | |||
Conversion of redeemable convertible preferred stock to common stock | 207,309 | 0 | 0 |
Net change in purchases of equipment, accrued but not paid | (537) | 746 | 142 |
Accretion of Series C and D redeemable convertible preferred stock | 6,332 | 9,570 | 8,648 |
Issuance of notes receivable related to early exercised stock options | 0 | 0 | 4,373 |
Repurchases of unvested common stock | 214 | 263 | 2,931 |
Vesting of early exercised common stock options | 3,255 | 3,702 | 2,862 |
Net change in deferred offering costs, accrued but not paid | 940 | 1,157 | 0 |
Capitalized leasehold improvements paid directly by landlord | $ 0 | $ 0 | $ 1,491 |
Business and Summary of Signifi
Business and Summary of Significant Accounting Policies | 12 Months Ended |
Jul. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Business and Summary of Significant Accounting Policies | Business and Summary of Significant Accounting Policies Business Zscaler, Inc. ("Zscaler," the "Company," "we," "us," or "our") is a cloud security company that developed a platform incorporating core security functionalities needed to enable users to safely utilize authorized applications and services based on an organization’s policies. Our solution is a purpose-built, multi-tenant, distributed cloud security platform that secures access for users and devices to applications and services, regardless of location. We deliver our solutions using a software-as-a-service ("SaaS") business model and sell subscriptions to customers to access our cloud platform, together with related support services. We were incorporated in Delaware in September 2007 and conduct business worldwide, with presence in North America, Europe and Asia. Our headquarters are located in San Jose, California. Reverse Stock Split In March 2018, our board of directors approved an amendment to the Company’s amended and restated certificate of incorporation effecting a 2-for-3 reverse stock split of the Company’s issued and outstanding shares of common stock and convertible preferred stock. The reverse stock split was effected on March 1, 2018. The par value of the common stock and the convertible preferred stock was not adjusted as a result of the reverse stock split. All issued and outstanding share and per share amounts included in the accompanying consolidated financial statements have been adjusted to reflect this reverse stock split for all periods presented. Initial Public Offering In March 2018, we completed our initial public offering ("IPO") of common stock, in which we sold 13,800,000 shares. The shares were sold at an IPO price of $16.00 per share for net proceeds of $205.3 million , after deducting underwriters' discounts and commissions of $15.5 million . In connection with the IPO, we incurred offering costs of $6.5 million which were recorded within stockholders’ equity (deficit) as a reduction of the net proceeds received from the IPO. Immediately prior to the closing of the IPO, all our outstanding shares of convertible preferred stock were automatically converted into 72,500,750 shares of common stock on a one -to-one basis. Fiscal Year Our fiscal year ends on July 31. References to fiscal 2018 , for example, refer to our fiscal year ended July 31, 2018 . Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries and have been prepared in conformity with accounting principles generally accepted in the United States ("U.S. GAAP"). All intercompany balances and transactions have been eliminated in consolidation. Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the amounts reported and disclosed in the financial statements and accompanying notes. Such estimates include, but are not limited to, the determination of revenue recognition, deferred revenue, deferred contract acquisition costs, the period of benefit generated from our deferred contract acquisition costs, allowance for doubtful accounts, valuation of common stock options and stock-based awards, useful lives of property and equipment, loss contingencies related to litigation and valuation of deferred tax assets. Management determines these estimates and assumptions on historical experience and on various other assumptions that are believed to be reasonable. Actual results could differ significantly from these estimates, and such differences may be material to the consolidated financial statements. Foreign Currency The functional currency of our foreign subsidiaries is the U.S. dollar. Accordingly, monetary assets and liabilities of our foreign subsidiaries are re-measured into U.S. dollars at the exchange rates in effect at the reporting date, non-monetary assets and liabilities are re-measured at historical rates, revenue and expenses are re-measured at average exchange rates in effect during each reporting period. Foreign currency transaction gains and losses are recorded in other income (expense), net in the consolidated statements of operations. We recognized re-measurement losses of $0.1 million, $0.1 million and $0.3 million for fiscal 2018 , 2017 and 2016 , respectively. JOBS Act Extended Transition Period We are an emerging growth company ("EGC") as defined in the Jumpstart Our Business Startups Act of 2012 ("JOBS Act"). An EGC may take advantage of specified reduced reporting requirements that are otherwise applicable generally to public companies, including, but not limited to, delayed adoption of new or revised accounting pronouncements applicable to public companies until such pronouncements are made applicable to private companies, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 ("Sarbanes-Oxley Act"), reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. We have irrevocably elected not to avail ourselves of the extended transition periods available under the JOBS Act for complying with new and revised accounting standards and, therefore, we will be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies, but we intend to take advantage of the other exemptions discussed above. We may take advantage of the extended transition period until we are no longer an EGC. We would cease to be an EGC upon the earliest to occur of: (i) the first fiscal year following the fifth anniversary of our IPO; (ii) the first fiscal year after our annual gross revenue is $1.07 billion or more; (iii) the date on which we have, during the previous three-year period, issued more than $1.0 billion in non-convertible debt securities; or (iv) as of the end of any fiscal year in which the market value of our common stock held by non-affiliates exceeded $700.0 million as of the end of the second quarter of that fiscal year. Concentration of Risks We generate revenue primarily from sale of subscriptions to access our cloud platform, together with related support services. Our sales team, along with our channel partner network of global telecommunications service providers, system integrators and value-added resellers (collectively "channel partners"), sells our services worldwide to organizations of all sizes. Due to the nature of our services and the terms and conditions of our contracts with our channel partners, our business could be affected unfavorably if we are not able to continue our relationships with them. Our financial instruments that are exposed to concentrations of credit risk consist primarily of cash, cash equivalents, short-term investments and accounts receivable. Although we deposit our cash with multiple financial institutions, the deposits, at times, may exceed federally insured limits. Cash equivalents and short-term investments consist of highly liquid investments in money market funds, U.S. treasury, U.S. agency securities and corporate debt securities, which are invested through financial institutions in the United States. We grant credit to our customers in the normal course of business. We monitor the financial condition of our customers to reduce credit risk. The following table summarizes the concentration of 10% or more of the total balance of accounts receivable, net: July 31, 2018 2017 Channel partner A 13 % * Channel partner B 13 % * Channel partner C * 17 % Channel partner D * 10 % Channel partner E * 15 % _____________ * Represents less than 10%. No single customer accounted for 10% or more of revenue in fiscal 2018 , 2017 and 2016 . Segment Information We operate as one reportable and operating segment. Our chief operating decision maker is our chief executive officer, who reviews financial information presented on a consolidated basis for purposes of making operating decisions, assessing financial performance and allocating resources. Revenue Recognition We have adopted Accounting Standards Codification ("ASC") Topic 606, Revenue From Contracts With Customers ("ASC 606"), effective as of August 1, 2017, using the full retrospective transition method. Under this method, we are presenting the consolidated financial statements for fiscal 2016, as if ASC 606 had been effective for that period as well. In accordance with ASC 606, revenue is recognized when a customer obtains control of promised services. The amount of revenue recognized reflects the consideration that we expect to be entitled to receive in exchange for these services. To achieve the core principle of this standard, we apply the following five steps: 1) Identify the contract with a customer We consider the terms and conditions of the contracts and our customary business practices in identifying our contracts under ASC 606. We determine we have a contract with a customer when the contract is approved, we can identify each party’s rights regarding the services to be transferred, we can identify the payment terms for the services, we have determined the customer has the ability and intent to pay and the contract has commercial substance. We apply judgment in determining the customer’s ability and intent to pay, which is based on a variety of factors, including the customer’s historical payment experience or, in the case of a new customer, credit and financial information pertaining to the customer. 2) Identify the performance obligations in the contract Performance obligations promised in a contract are identified based on the services that will be transferred to the customer that are both capable of being distinct, whereby the customer can benefit from the service either on its own or together with other resources that are readily available from third parties or from us, and are distinct in the context of the contract, whereby the transfer of the services is separately identifiable from other promises in the contract. Our performance obligations consist of (i) our subscription and support services and (ii) professional and other services. 3) Determine the transaction price The transaction price is determined based on the consideration to which we expect to be entitled in exchange for transferring services to the customer. Variable consideration is included in the transaction price if, in our judgment, it is probable that a significant future reversal of cumulative revenue under the contract will not occur. None of our contracts contain a significant financing component. 4) Allocate the transaction price to performance obligations in the contract If the contract contains a single performance obligation, the entire transaction price is allocated to the single performance obligation. Contracts that contain multiple performance obligations require an allocation of the transaction price to each performance obligation based on a relative standalone selling price ("SSP"). 5) Recognize revenue when or as we satisfy a performance obligation Revenue is recognized at the time the related performance obligation is satisfied by transferring the promised service to a customer. Revenue is recognized when control of the services is transferred to our customers, in an amount that reflects the consideration that we expect to receive in exchange for those services. We generate all our revenue from contracts with customers. Subscription and Support Revenue We generate revenue primarily from sales of subscriptions to access our cloud platform, together with related support services to our customers. Arrangements with customers do not provide the customer with the right to take possession of our software operating our cloud platform at any time. Instead, customers are granted continuous access to our cloud platform over the contractual period. A time-elapsed output method is used to measure progress because we transfer control evenly over the contractual period. Accordingly, the fixed consideration related to subscription and support revenue is generally recognized on a straight-line basis over the contract term beginning on the date that our service is made available to the customer. The typical subscription and support term is one to three years. Most of our contracts are non-cancelable over the contractual term. Customers typically have the right to terminate their contracts for cause if we fail to perform in accordance with the contractual terms. Some of our customers have the option to purchase additional subscription and support services at a stated price. These options generally do not provide a material right as they are priced at our SSP. Professional and Other Services Revenue Professional and other services revenue consists of fees associated with providing deployment advisory services that educate and assist our customers on the best use of our solutions, as well as advise customers on best practices as they deploy our solution. These services are distinct from subscription and support services. Professional services do not result in significant customization of the subscription service. Revenue from professional services provided on a time and materials basis is recognized as the services are performed. Total professional and other services revenue has historically not been material. Contracts with Multiple Performance Obligations Most of our contracts with customers contain multiple promised services consisting of: (i) our subscription and support services and (ii) professional and other services that are distinct and accounted for separately. The transaction price is allocated to the separate performance obligations on a relative SSP basis. We determine SSP based on our overall pricing objectives, taking into consideration the type of subscription and support services and professional and other services, the geographical region of the customer and the number of users. Variable Consideration Revenue from sales is recorded at the net sales price, which is the transaction price, and includes estimates of variable consideration. The amount of variable consideration that is included in the transaction price is constrained and is included in the net sales price only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue will not occur when the uncertainty is resolved. If our services do not meet certain service level commitments, our customers are entitled to receive service credits, and in certain cases, refunds, each representing a form of variable consideration. We have historically not experienced any significant incidents affecting the defined levels of reliability and performance as required by our subscription contracts. Accordingly, estimated refunds related to these agreements were not material to the periods presented. We provide rebates and other credits within our contracts with certain customers, which are estimated based on the value expected to be earned or claimed on the related sales transaction. Overall, the transaction price is reduced to reflect our estimate of the amount of consideration to which we are entitled based on the terms of the contract. Estimated rebates and other credits were not material during the periods presented. Disaggregation of Revenue Subscription and support revenue is recognized over time and accounted for approximately 99% of our revenue in fiscal 2018 , 2017 and 2016 . The following table summarizes the revenue by region based on the shipping address of customers who have contracted to use our cloud platform: Year Ended July 31, 2018 2017 2016 Amount % Revenue Amount % Revenue Amount % Revenue (in thousands, except for percentage data) United States $ 86,123 45 % $ 57,990 46 % $ 35,794 44 % Europe, Middle East and Africa (*) 84,828 45 56,857 45 37,403 47 Asia Pacific 14,465 8 9,853 8 5,779 7 Other 4,758 2 1,017 1 1,349 2 Total $ 190,174 100 % $ 125,717 100 % $ 80,325 100 % _____ (*) Revenue from the United Kingdom represented 11% , 13% and 12% of the total revenue for fiscal 2018, 2017 and 2016, respectively. The following table summarizes the revenue from contracts by type of customer: Year Ended July 31, 2018 2017 2016 Amount % Revenue Amount % Revenue Amount % Revenue (in thousands, except for percentage data) Channel partners $ 175,798 92 % $ 110,900 88 % $ 67,472 84 % Direct customers 14,376 8 14,817 12 12,853 16 Total $ 190,174 100 % $ 125,717 100 % $ 80,325 100 % Contract Balances Contract liabilities consist of deferred revenue and include payments received in advance of performance under the contract. Such amounts are recognized as revenue over the contractual period. In fiscal 2018 , 2017 and 2016 we recognized revenue of $85.3 million, $58.5 million and $40.7 million, respectively, that was included in the corresponding contract liability balance at the beginning of the related fiscal year. We receive payments from customers based upon contractual billing schedules; accounts receivable are recorded when the right to consideration becomes unconditional. Payment terms on invoiced amounts are typically 30 days but it may be up to 90 days for some of our channel partners. Contract assets include amounts related to our contractual right to consideration for both completed and partially completed performance obligations that may not have been invoiced and such amounts have historically not been material. Remaining Performance Obligations The typical subscription and support term is one to three years. Most of our subscription and support contracts are non-cancelable over the contractual term. However, customers typically have the right to terminate their contracts for cause, if we fail to perform. As of July 31, 2018 , the aggregate amount of the transaction price allocated to remaining performance obligations was $397.9 million. We expect to recognize 53% of the transaction price over the next 12 months and 96% of the transaction price over the next three years, with the remainder recognized thereafter. Costs to Obtain and Fulfill a Contract We capitalize sales commission and associated payroll taxes paid to internal sales personnel that are incremental to the acquisition of channel partner and direct customer contracts. These costs are recorded as deferred contract acquisition costs in the consolidated balance sheets. We determine whether costs should be deferred based on our sales compensation plans, if the commissions are in fact incremental and would not have occurred absent the customer contract. Sales commissions for renewal of a contract are not considered commensurate with the commissions paid for the acquisition of the initial contract given the substantive difference in commission rates in proportion to their respective contract values. Commissions paid upon the initial acquisition of a contract are amortized over an estimated period of benefit of five years while commissions paid for renewal contracts are amortized over the contractual term of the renewals. Amortization of deferred contract acquisition costs is recognized on a straight-line basis commensurate with the pattern of revenue recognition and included in sales and marketing expense in the consolidated statements of operations. We determine the period of benefit for commissions paid for the acquisition of the initial contract by taking into consideration the expected subscription term and expected renewals of our customer contracts, the duration of our relationships with our customers, customer retention data, our technology development lifecycle and other factors. We periodically review the carrying amount of deferred contract acquisition costs to determine whether events or changes in circumstances have occurred that could impact the period of benefit of these deferred costs. We did not recognize any impairment losses of deferred contract acquisition costs during the periods presented. The following table summarizes the activity of the deferred contract acquisition costs: Year Ended July 31, 2018 2017 2016 (in thousands) Beginning balance $ 34,662 $ 21,137 $ 13,150 Capitalization of contract acquisition costs 34,429 21,999 13,502 Amortization of deferred contract acquisition costs (13,181 ) (8,474 ) (5,515 ) Ending balance $ 55,910 $ 34,662 $ 21,137 Deferred contract acquisition costs $ 16,136 $ 10,469 $ 6,743 Deferred contract acquisition costs, noncurrent 39,774 24,193 14,394 Total deferred contract acquisition costs $ 55,910 $ 34,662 $ 21,137 Sales commissions accrued but not paid at July 31, 2018 and 2017 , totaled $ 10.0 million and $ 5.4 million, respectively, which are included within accrued compensation in the consolidated balance sheets. Accounts Receivable and Allowance Accounts receivable are recorded at the invoiced amount and are non-interest bearing. Accounts receivable are stated at their net realizable value, net of an allowance for doubtful accounts. We have a well-established collections history from our customers. Credit is extended to customers based on an evaluation of their financial condition and other factors. In determining the necessary allowance for doubtful accounts, management considers the current aging and financial condition of our customers, the amount of receivables in dispute and current payment patterns. The allowance for doubtful accounts has historically not been material. There were no material write-offs recognized in the periods presented. Accordingly, the movements in the allowance for doubtful accounts were not material for any of the periods presented. We do not have any off-balance-sheet credit exposure related to our customers. Cash Equivalents and Short-Term Investments We classify all highly liquid investments purchased with an original maturity of 90 days or less from the date of purchase as cash equivalents and all highly liquid investments with original maturities beyond 90 days at the time of purchase as short-term investments. Our cash equivalents and short-term investments consist of highly liquid investments in money market funds, U.S. treasury securities, U.S. government agency securities and corporate debt securities. We classify our investments as available-for-sale investments and present them within current assets since these investments represent funds available for current operations and we have the ability and intent, if necessary, to liquidate any of these investments in order to meet our liquidity needs within the next 12 months. Our investments are carried at fair value, with unrealized gains and losses, net of tax, reported in accumulated other comprehensive loss within stockholders’ equity (deficit). Our investments are reviewed periodically to determine whether a decline in a security’s fair value below the amortized cost basis is other-than-temporary. If the cost of an individual investment exceeds its fair value, we consider available quantitative and qualitative factors such as the length of time and extent to which the market value has been less than the cost, the financial condition and near-term prospects of the issuer and our intent to sell, or whether it is more likely than not we will be required to sell the investment before recovery of the investment’s amortized cost basis. If we believe that a decline in fair value is determined to be other-than-temporary, we write down these investments to fair value. There were no impairments recognized on our investments during the periods presented. Interest income, amortization of premiums and discounts, realized gains and losses and declines in fair value judged to be other-than-temporary on our available-for-sale securities are included in interest income, net in the consolidated statements of operations. We use the specific identification method to determine the cost in calculating realized gains and losses upon the sale of these investments. Fair Value of Financial Instruments Our financial instruments consist of cash equivalents, short-term investments, accounts receivable, accounts payable and accrued liabilities. Cash equivalents and short-term investments are recorded at fair value. Accounts receivable, accounts payable and accrued liabilities are stated at their carrying value, which approximates fair value due to the short-time to the expected receipt or payment date. Assets recorded at fair value on a recurring basis in the consolidated balance sheets, consisting of cash equivalents and short-term investments, are categorized in accordance with the fair value hierarchy based upon the level of judgment associated with the inputs used to measure their fair values. Restricted Cash We maintained restricted cash of $0.6 million as of July 31, 2018 and 2017 through a letter of credit. The letter of credit was established according to the requirements under certain lease agreements. Property and Equipment Property and equipment, net are stated at historical cost net of accumulated depreciation. Property and equipment, excluding leasehold improvements, are depreciated using the straight-line method over the estimated useful lives of the respective assets, generally ranging from two to five years. Leasehold improvements are amortized using the straight-line method over the shorter of the estimated useful lives of the respective assets or the lease term. Expenditures for maintenance and repairs are expensed as incurred and significant improvements and betterments that substantially enhance the life of an asset are capitalized. Capitalized Internal-Use Software Development Costs We capitalize certain development costs related to our cloud security platform during the application development stage. Costs related to preliminary project activities are analogous to research and development activities and are expensed as incurred. The preliminary stage includes such activities as conceptual formulation of alternatives, 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 software is substantially complete and ready for its intended use. Capitalized costs are recorded as part of property and equipment, net. Maintenance and training costs are expensed as incurred. Capitalized internal-use software is amortized on a straight-line basis over its estimated useful life, which is generally three years, and is recorded as cost of revenue in the consolidated statements of operations. We capitalized costs associated with the development of software for internal-use of $1.8 million , $0.4 million and $0.8 million in fiscal 2018 , 2017 and 2016 , respectively. We recognized amortization expense of capitalized internal-use software of $0.9 million , $1.2 million and $1.0 million in fiscal 2018 , 2017 and 2016 , respectively. Impairment of Long-Lived Assets We review our long-lived assets, comprised primarily of our property and equipment, for impairment whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. We measure the recoverability of these assets by comparing the carrying amounts to the future undiscounted cash flows these assets are expected to generate. If the total of the future undiscounted cash flows are less than the carrying amount of an asset, we record an impairment charge for the amount by which the carrying amount of the asset exceeds the fair value. Impairment losses on long-lived assets were not material during the periods presented. Deferred Offering Costs Deferred offering costs consisted of fees and expenses incurred in connection with the anticipated sale of our common stock in an IPO, including legal, accounting, printing and other IPO-related costs. As of July 31, 2017 , we had capitalized deferred offering costs of $1.2 million and were included in other noncurrent assets. Upon completion of our IPO, deferred offering costs totaling $6.5 million were reclassified into stockholders' equity (deficit) as a reduction of the net proceeds received from the IPO. Leases We lease our facilities under operating lease agreements and recognize related rent expense on a straight-line basis over the term of the lease. Some of our lease agreements contain rent holidays, scheduled rent increases, lease incentives and renewal options. Rent holidays and scheduled rent increases are included in the determination of rent expense to be recorded over the lease term. Lease incentives are recognized as a reduction of rent expense on a straight-line basis over the term of the lease. Renewals are not assumed in the determination of the lease term unless they are deemed to be reasonably assured at the inception of the lease. We begin recognizing rent expense on the date that we obtain the legal right to use and control of the leased space. As part of our lease agreement at our headquarters, we obtained $1.5 million in leasehold improvement incentives from the landlord in fiscal 2016. As the incentives were paid directly to third parties by our landlord, they were recorded as a noncash investing activity in the consolidated statements of cash flows. Stock-Based Compensation Stock-based compensation expense for common stock options granted to employees and non-employees is recognized based on the fair value of the awards granted, determined using the Black-Scholes option pricing model and a single option award approach. Stock‐based compensation expense is recognized as expense over the requisite service period, generally four years. Unvested options issued to non-employees are remeasured at fair market value at the end of each reporting period. Stock-based compensation expense related to purchase rights granted under the employee stock purchase plan is based on the Black-Scholes option pricing model fair value of the number of awards estimated as of the beginning of the offering period. Stock-based compensation expense is recognized following the straight-line attribution method over the offering period. Prior to the IPO, the fair value of our common stock for financial reporting purposes was determined considering numerous objective and subjective factors and required judgment to determine the fair value of common stock as of each grant date. Subsequent to the IPO, we determine the fair value using the market closing price of our common stock on the date of grant. Prior to fiscal 2018, we recognized stock-based compensation expense, net of estimated forfeitures. We used historical data to estimate pre-vesting forfeitures and recorded stock-based compensation expense only for those grants that were expected to vest. On August 1, 2017, we adopted Accounting Standard Update ("ASU") No. 2016-09, Compensation—Stock Compensation: Improvements to Employee Share-Based Payment Accounting ("ASU 2016-09"), which simplifies several aspects of the accounting for employee share-based payment transactions. In accordance with ASU 2016-09, we have elected to account for forfeitures as they occur instead of estimating the number of awards expected to be forfeited and adjusting the estimate when it is no longer probable that the employee will fulfill the service condition. We adopted this provision in our first quarter of fiscal 2018 and recorded a cumulative-effect adjustment to accumulated deficit of $0.4 million , net of tax, as of the date of adoption. Additionally, upon adoption of ASU 2016-09, on a modified retrospective basis, the previously unrecognized excess tax benefits of $0.9 million as of July 31, 2017 were recorded as an increase of U.S. federal and state deferred tax assets, which was substantially offset by our valuation allowance. Prospectively, all excess tax benefits and deficiencies will be recognized in the income statement as a component of our income tax expense or benefit. Further, we will present excess tax benefits as an operating activity in the consolidated statements of cash flows on a prospective basis. The net excess tax benefits related to equity awards was not material in fiscal 2018 . Research and Development Our research and development expenses support our efforts to add new features to our existing offerings and to ensure the reliability, availability and scalability of our solutions. Our cloud platform is software-driven, and our research and development teams employ software engineers in the design and the related development, testing, certifica |
Cash Equivalents and Short-Term
Cash Equivalents and Short-Term Investments | 12 Months Ended |
Jul. 31, 2018 | |
Cash and Cash Equivalents [Abstract] | |
Cash Equivalents and Short-Term Investments | Cash Equivalents and Short-Term Investments Cash equivalents and short-term investments consisted of the following as of July 31, 2018 : Amortized Unrealized Unrealized (in thousands) Cash equivalents: Money market funds $ 74,408 $ — $ — $ 74,408 U.S. treasury securities 17,488 — — 17,488 U.S. government agency securities 1,999 — — 1,999 Corporate debt securities 11,010 — (1 ) 11,009 Total cash equivalents $ 104,905 $ — $ (1 ) $ 104,904 Short-term investments: U.S. treasury securities $ 55,768 $ — $ (17 ) $ 55,751 U.S. government agency securities 17,953 — (19 ) 17,934 Corporate debt securities 89,362 1 (88 ) 89,275 Total short-term investments $ 163,083 $ 1 $ (124 ) $ 162,960 Total cash equivalents and short-term investments $ 267,988 $ 1 $ (125 ) $ 267,864 Cash equivalents consisted of the following as of July 31, 2017 : Amortized Unrealized Unrealized (in thousands) Cash equivalents: Money market funds $ 72,441 $ — $ — $ 72,441 We did not have investments classified as short-term investments as of July 31, 2017 . The amortized cost and fair value of our short-term investments based on their stated maturities consisted of the following as of July 31, 2018 : Amortized Cost Fair Value (in thousands) Due within one year $ 116,897 $ 116,843 Due between one and two years 46,186 46,117 Total short-term investments $ 163,083 $ 162,960 Short-term investments that were in an unrealized loss position consisted of the following as of July 31, 2018 : Less than 12 Months Greater than 12 Months Total Fair Unrealized Fair Unrealized Fair Unrealized (in thousands) U.S. treasury securities $ 55,750 $ (17 ) $ — $ — $ 55,750 $ (17 ) U.S. government agency securities 17,934 (19 ) — — 17,934 (19 ) Corporate debt securities 83,332 (88 ) — — 83,332 (88 ) Total investments in a loss position $ 157,016 $ (124 ) $ — $ — $ 157,016 $ (124 ) We review the individual securities that have unrealized losses in our short-term investment portfolio on a regular basis to evaluate whether or not any security has experienced an other-than-temporary decline in fair value. We evaluate, among others, whether we have the intention to sell any of these investments and whether it is not more likely than not that we will be required to sell any of them before recovery of the amortized cost basis. Based on this evaluation, we determined that there were no other-than-temporary impairments associated with our short-term investments as of July 31, 2018 . |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Jul. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Fair value is defined as the exchange price that would be received from sale of an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. We measure our financial assets and liabilities at fair value at each reporting period using a fair value hierarchy which requires us to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument’s classification within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Three levels of inputs may be used to measure fair value: • Level I - Observable inputs are unadjusted quoted prices in active markets for identical assets or liabilities; • Level II - Observable inputs are quoted prices for similar assets and liabilities in active markets or inputs other than quoted prices that are observable for the assets or liabilities, either directly or indirectly through market corroboration, for substantially the full term of the financial instruments; and • Level III - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. These inputs are based on our own assumptions used to measure assets and liabilities at fair value and require significant management judgment or estimation. Our money market funds are classified within Level I due to the highly liquid nature of these assets and have quoted prices in active markets. Certain of our investments in available-for-sale securities (i.e., U.S. treasury securities, U.S. government agency securities and corporate securities) are classified within Level II. The fair value of these securities is priced by using inputs based on non-binding market consensus prices that are primarily corroborated by observable market data or quoted market prices for similar instruments. Assets that are measured at fair value on a recurring basis consisted of the following as of July 31, 2018 : Level I Level II Level III Total Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs (in thousands) Cash equivalents: Money market funds $ 74,408 $ 74,408 $ — $ — U.S. treasury securities 17,488 — 17,488 — U.S. government agency securities 1,999 — 1,999 — Corporate debt securities 11,009 — 11,009 — Total cash equivalents $ 104,904 $ 74,408 $ 30,496 $ — Short-term investments: U.S. treasury securities $ 55,751 $ — $ 55,751 $ — U.S. government agency securities 17,934 — 17,934 — Corporate debt securities 89,275 — 89,275 — Total short-term investments $ 162,960 $ — $ 162,960 $ — Assets that are measured at fair value on a recurring basis consisted of the following as of July 31, 2017 : Level I Level II Level III Total Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs (in thousands) Cash equivalents: Money market funds $ 72,441 $ 72,441 $ — $ — We did not have transfers between levels of the fair value hierarchy of assets measured at fair value during the periods presented. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Jul. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and Equipment Property and equipment consisted of the following: July 31, Estimated Useful Life 2018 2017 (in thousands) Hosting equipment 2-3 years $ 30,743 $ 20,241 Computers and equipment 3-5 years 2,335 1,539 Purchased software 3 years 1,324 1,257 Capitalized internal-use software 3 years 6,163 4,390 Furniture and fixtures 5 years 1,478 1,035 Leasehold improvements Shorter of useful life or lease term 2,123 1,981 Property and equipment, gross 44,166 30,443 Less: Accumulated depreciation and amortization (24,401 ) (17,304 ) Total property and equipment, net $ 19,765 $ 13,139 We recognized depreciation and amortization expense on property and equipment of $8.0 million , $6.8 million and $4.9 million in fiscal 2018 , 2017 and 2016 , respectively. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Jul. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Operating Leases We lease our office space under various operating lease agreements expiring at various dates through April 2021 . Certain of these lease agreements have escalating rent payments. We recognize rent expense under such agreements on a straight-line basis over the lease term. The difference between the rent paid and the straight-line rent expense is recorded as deferred rent, which current portion is included within accrued expenses and other current liabilities and noncurrent portion is included within other noncurrent liabilities in the consolidated balance sheets. We recognized rent expense of $2.5 million , $1.7 million and $1.4 million in fiscal 2018 , 2017 and 2016 , respectively. Future minimum payments under non-cancelable operating leases consisted of the following as of July 31, 2018 : Operating (in thousands) Year ending July 31, 2019 $ 2,834 2020 2,274 2021 1,598 Total $ 6,706 Data Center Contract Commitments We enter into long-term non-cancelable agreements with providers in various countries to purchase data center capacity, such as bandwidth and colocation space, for our cloud platform. We recognized bandwidth and colocation costs of $9.4 million , $6.9 million and $5.6 million for fiscal 2018 , 2017 and 2016 , respectively. Future minimum payments under non-cancelable data center contracts consisted of the following as of July 31, 2018 : Data Center (in thousands) Year ending July 31, 2019 $ 6,280 2020 3,763 2021 1,300 2022 179 Total $ 11,522 Non-cancelable Purchase Obligations In the normal course of business, we enter into non-cancelable purchase commitments with various parties to purchase products and services such as technology licenses, equipment, software subscriptions, corporate events and outsourced services. As of July 31, 2018 and 2017 , we had outstanding non-cancelable purchase obligations with a term of 12 months or longer of $3.1 million and $2.2 million , respectively. Legal Matters Symantec Litigation We are currently involved in legal proceedings with Symantec. On December 12, 2016, Symantec filed a complaint, which we refer to as Symantec Case 1, in the U.S. District Court for the District of Delaware alleging that "Zscaler’s cloud security platform" infringes U.S. Patent Nos. 6,279,113, 7,203,959 ("’959 patent"), 7,246,227 ("’227 patent"), 7,392,543, 7,735,116, 8,181,036 and 8,661,498. The complaint seeks compensatory damages, an injunction, enhanced damages and attorney fees. On August 2, 2017, the court granted our motion to transfer Symantec Case 1 from the District of Delaware to the Northern District of California. On March 23, 2018, the Northern District of California court granted our motion to dismiss the asserted claims of the ’959 and ’227 patents as invalid based on unpatentable subject matter. On April 18, 2017, Symantec filed a second complaint, which we refer to as Symantec Case 2, in the U.S. District Court for the District of Delaware alleging that "Zscaler’s cloud security platform" infringes U.S. Patent Nos. 6,285,658, 7,360,249, 7,587,488, 8,316,429, 8,316,446, 8,402,540 and 9,525,696. The complaint seeks compensatory damages, an injunction, enhanced damages and attorney fees. On June 22, 2017, Symantec filed a notice of voluntary dismissal of its complaint in Symantec Case 2 along with a new complaint alleging infringement of the same patents and adding Symantec Limited as a plaintiff and alleging willful infringement of the ’429 and ’446 patents. On July 31, 2017, the court granted our motion to transfer Symantec Case 2 from the District of Delaware to the Northern District of California. On May 21, 2018, Symantec filed an amended complaint adding allegations of willful infringement of all of the asserted patents in Symantec Case 2. We have also received letters from Symantec alleging that our "cloud security platform" infringes U.S. Patent Nos. 7,031,327, 7,496,661, 7,543,036 and 7,624,110. We believe that our technology does not infringe Symantec’s asserted patents and that these patents are invalid. Should Symantec prevail with its infringement allegations, we could be required to pay substantial damages for past and future sales and/or licensing of our services, enjoined from making, using, selling or otherwise disposing of our services if a license or other right to continue selling our services is not made available to us, and required to pay substantial ongoing royalties and comply with unfavorable terms if such a license is made available to us. Any of these outcomes could result in a material adverse effect on our business. Even if we were to prevail, this litigation could be costly and time-consuming, divert the attention of our management and key personnel from our business operations, deter distributors from selling or licensing our services, and dissuade potential customers from purchasing our services, which would also materially harm our business. The expense of litigation and the timing of this expense from period to period are difficult to estimate, subject to change and could adversely affect our results of operations. In addition, any public announcements of the results of any proceedings in Symantec Case 1 or Case 2 could be negatively perceived by industry or financial analysts and investors, and could cause our stock price to experience volatility or decline. We have not recorded a liability with respect to Symantec Case 1 or Case 2 based on our determination that a loss in either case is not probable under the applicable accounting standards. We are vigorously defending Symantec Case 1 and Case 2. We are unable to predict the likelihood of success of Symantec’s infringement claims. Finjan Litigation We are currently involved in legal proceedings with Finjan. On December 5, 2017, Finjan filed a complaint, in the U.S. District Court for the Northern District of California alleging that Zscaler’s "Internet Access Bundles," "Private Access Bundle," "Zscaler Enforcement Node," "Secure Web Gateway," "Cloud Firewall," "Cloud Sandbox" and "Cloud Architecture products and services" infringe U.S. Patent Nos. 6,804,780, 7,647,633, 8,677,494 and 7,975,305. The complaint seeks compensatory damages, an injunction, enhanced damages and attorney fees. We believe our technology does not infringe Finjan’s asserted patents and that Finjan’s patents are invalid. Should Finjan prevail with its infringement allegations, we could be required to pay substantial damages for past and future sales and/or licensing of our services, enjoined from making, using, selling or otherwise disposing of our services if a license or other right to continue selling our services is not made available to us, and required to pay substantial ongoing royalties and comply with unfavorable terms if such a license is made available to us. Any of these outcomes could result in a material adverse effect on our business. Even if we were to prevail, this litigation could be costly and time-consuming, divert the attention of our management and key personnel from our business operations, deter distributors from selling or licensing our services, and dissuade potential customers from purchasing our services, which would also materially harm our business. The expense of litigation and the timing of this expense from period to period are difficult to estimate, subject to change and could adversely affect our results of operations. In addition, any public announcements of the results of any proceedings in this matter could be negatively perceived by industry or financial analysts and investors, and could cause our stock price to experience volatility or decline. While the range of potential loss resulting from the lawsuit cannot be reasonably estimated, we have accrued a total liability of $3.2 million as of July 31, 2018 related to past negotiations with Finjan of which we recorded $0.7 million in fiscal 2018 and $2.5 million in fiscal 2017. We are vigorously defending this lawsuit. Given the early stage in the litigation, we are unable to predict the likelihood of success of Finjan’s infringement claims. Other Litigation and Claims In addition, from time to time we are a party to various litigation matters and subject to claims that arise in the ordinary course of business, including patent, commercial, product liability, employment, class action, whistleblower and other litigation and claims, as well as governmental and other regulatory investigations and proceedings. In addition, third parties may from time to time assert claims against us in the form of letters and other communications. Except as otherwise described above, there is no pending or threatened legal proceeding to which we are a party that, in our opinion, is likely to have a material adverse effect on our future financial results or operations; however, the results of litigation and claims are inherently unpredictable. Regardless of the outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources and other factors. The expense of litigation and the timing of this expense from period to period are difficult to estimate, subject to change and could adversely affect our results of operations. |
Convertible Preferred Stock
Convertible Preferred Stock | 12 Months Ended |
Jul. 31, 2018 | |
Temporary Equity Disclosure [Abstract] | |
Convertible Preferred Stock | Convertible Preferred Stock In March 2018, upon completion of our IPO, all shares of convertible preferred stock then outstanding, totaling 72,500,750 shares, were automatically converted into an equivalent number of shares of common stock on a one -to-one basis. Additionally, the carrying amount of the redeemable convertible preferred stock of $207.3 million , inclusive of accretion of Series C and D redeemable convertible preferred stock of $24.7 million , was reclassified to stockholders’ equity (deficit). In connection with the IPO, we filed an Amended and Restated Certificate of Incorporation which authorizes the issuance of 200,000,000 shares of undesignated preferred stock with a par value of $0.001 with rights and preferences, including voting rights, designated from time to time by our board of directors. We did not have shares of convertible preferred stock issued and outstanding as of July 31, 2018 . Convertible preferred stock consisted of the following as of July 31, 2017: Shares Authorized Issued and Outstanding Carrying Value Liquidation Preference Issue Price per Share (in thousands, except per share data) Series A 28,000 28,000 $ 5,000 $ 5,000 $ 0.18 Series B 25,000 24,856 30,095 30,200 $ 1.22 Series C 7,500 7,375 37,897 37,980 $ 5.15 Series D 12,600 12,270 127,985 128,196 $ 8.97 Total 73,100 72,501 $ 200,977 $ 201,376 In September 2015, we amended our Amended and Restated Certificate of Incorporation and increased the number of Series D preferred stock authorized for sale and issuance to 12,492,749 shares. We also amended our Series D preferred stock purchase agreement to permit the sale of an additional 2,788,560 shares of Series D redeemable convertible preferred stock at $8.9652 per share for total gross proceeds of $25.0 million . The holders of our convertible preferred stock had various rights, preferences and privileges, which are summarized as follows: Conversion Rights Each share of our preferred stock was convertible, at the option of its holder, into the number of fully paid and non-assessable shares of common stock, which results from dividing the applicable original issue price per share by the applicable conversion price per share on the date that the share certificate is surrendered for conversion. As of July 31, 2017, the conversion prices per share for all shares of preferred stock were equal to the original issue prices, and the rate at which each share would convert into common stock was one -for-one. As discussed above, upon completion of our IPO, all our outstanding shares of convertible preferred stock were automatically converted to common stock. Dividend Rights Each holder of the Series A, B, C and D convertible preferred stock was entitled to receive, out of any funds legally available, noncumulative dividends at the rate of $0.0142875 , $0.0972 , $0.412305 and $0.71721 per share, respectively, per annum, payable in preference and priority to any payment of any dividends on common stock when and if declared by our board of directors. The right to receive dividends on shares of preferred stock was not cumulative. No dividends were declared through the date our convertible preferred stock was automatically converted to common stock upon completion of our IPO. Liquidation Rights In the event of any liquidation, dissolution or winding up of the Company, holders of Series A, B, C and D convertible preferred stock were entitled to receive, in preference to holders of the common stock, an amount per share equal to the greater of (a) the sum of the liquidation preference, which was $0.178575 for a Series A share, $1.215 for a Series B share, $5.14965 for a Series C share and $8.9652 plus 8% compounded annually from the initial issuance date for a Series D share, plus all declared but unpaid dividends or (b) the amount that would be received on such share of redeemable convertible preferred stock if such share were converted to a share of common stock immediately prior to such liquidation event. All remaining assets would then be distributed pro rata to holders of common stock. A liquidation event was deemed to be outside of our control. Voting Rights The holders of Series A, B, C and D convertible preferred stock were entitled to the number of votes equal to the number of shares of common stock into which such preferred stock was convertible. The holders of the preferred stock were entitled to vote on all matters on which the common stockholders are entitled to vote. So long as at least 1,333,333 shares (as adjusted for recapitalization) of each of the Series A, B, C and D convertible preferred stock remained outstanding, the holders of each of the Series A, B, C and D convertible preferred stock, voting as a separate class, were entitled to select one member of our board of directors. Redemption Rights Series C redeemable convertible preferred stock was redeemable at any time after the sixth anniversary of the initial issuance of the Series D redeemable convertible preferred stock. Series D redeemable convertible preferred stock was redeemable at any time after its sixth anniversary. The redemption price per share for Series C was equal to its original issue price of $5.14965 plus all declared and unpaid dividends. The redemption price per share for Series D was equal to the original issue price of $8.9652 plus 8% per annum, compounded annually, from the issuance date through its redemption date. As the redemption of Series C and D was not solely within our control and was contingent only on the passage of time, we considered probable that the instruments would become redeemable. Accordingly, both Series C and D redeemable convertible preferred stock were accreted to their redemption prices utilizing the effective interest method through their automatic conversion to common stock upon completion of our IPO. While Series A, B, C and D convertible preferred stock did not have mandatory redemption provisions, they were contingently redeemable upon a deemed liquidation event. We recognized accretion to the redemption price of Series C and D redeemable convertible preferred stock of $6.3 million , $9.6 million and $8.6 million in fiscal 2018 , 2017 and 2016 , respectively. Accretion was recognized as a reduction of additional paid-in capital with a corresponding increase to the carrying amount of Series C and D redeemable convertible preferred stock, which is presented within redeemable convertible preferred stock in the consolidated balance sheets. As described above, upon completion of our IPO, the accretion rights of Series C and D redeemable convertible preferred stock were terminated and their carrying amount of $207.3 million , inclusive of cumulative accretion of $24.7 million , was reclassified to stockholders' equity (deficit). Classification of Convertible Preferred Stock The redemption provisions of the Series C and Series D redeemable convertible preferred stock were considered provisions that were not solely within our control. Also, the deemed liquidation preference provisions of the Series A, B, C and D convertible preferred stock were considered contingent redemption provisions that were not solely within our control. Accordingly, our convertible preferred stock had been presented outside of permanent equity in the mezzanine section of the consolidated balance sheet as of July 31, 2017. |
Common Stock
Common Stock | 12 Months Ended |
Jul. 31, 2018 | |
Equity [Abstract] | |
Common Stock | Common Stock In March 2018, upon completion of our IPO, we sold 13,800,000 shares. The shares were sold at an IPO price of $16.00 per share for net proceeds of $205.3 million , after deducting underwriters' discounts and commissions of $15.5 million . In connection with our IPO, we incurred offering costs of $6.5 million which were recorded within stockholders’ equity (deficit) as a reduction of the net proceeds received from the IPO. In connection with the IPO, we filed an Amended and Restated Certificate of Incorporation which authorizes the issuance of 1,000,000,000 shares of common stock with a par value of $0.001 . Our common stock is not redeemable and common stockholders are entitled to one vote for each share of common stock held. Common Stock Reserved for Future Issuance The following table summarizes our shares of common stock reserved for future issuance: July 31, 2018 (in thousands) Equity awards outstanding: Stock options 16,175 Unvested restricted stock units 209 Purchase rights committed under the employee stock purchase plan 2,044 Equity awards available for future grants: Equity incentive plans 13,471 Employee stock purchase plan 156 Total reserved shares of common stock for future issuance 32,055 |
Stock Based Compensation
Stock Based Compensation | 12 Months Ended |
Jul. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation Equity Incentive Plans In March 2018, we adopted the Fiscal Year 2018 Equity Incentive Plan (the "2018 Plan"). In September 2007, we adopted the 2007 Stock Plan (the "2007 Plan"). Equity incentive awards granted under the 2018 Plan and 2007 Plan, collectively referred to as the "Plans," may be either incentive RSUs, restricted stock, stock options, nonstatutory stock options, stock appreciation rights, performance units and performance shares to our employees, directors, officers and consultants. The Plans allow for the grant of restricted stock units ("RSUs") to employees at the current fair value of our common stock. Generally, RSUs are subject to a four -year vesting period, with 25% of the shares vesting one year from the date of grant and quarterly thereafter over the remaining vesting term. Under the Plans, the exercise price of a stock option grant must be not less than 100% of the fair market value of the common stock on the date of grant. Generally, stock options vest over four years with 25% of the option shares vesting one year from the date of grant and monthly thereafter over the remaining vesting term. Stock options granted under the 2018 Plan and 2007 Plan are exercisable over a maximum term of ten years and seven years, respectively, from the date of grant. Stock options that are forfeited or canceled shall become available for future grant or sale under the 2018 Plan. A total of 12,700,000 shares of common stock were initially authorized for issuance under the 2018 Plan. Our compensation committee administers the 2018 Plan. The number of shares of common stock available for issuance under the 2018 Plan also includes an annual increase on the first day of each fiscal year beginning on August 1, 2018, equal to the least of: (i) 12,700,000 shares of common stock, (ii) 5% of the outstanding shares of our common stock as of the last day of the immediately preceding fiscal year, or (iii) such other number of shares determined by our board of directors. In March 2018, in connection with our IPO, the 2007 Plan was terminated along with its remaining balance of shares of common stock available for grant. With the establishment of the 2018 Plan, we no longer grant stock-based awards under the 2007 Plan and any shares underlying stock options that expire or terminate or are forfeited or repurchased by us under the 2007 Plan will be automatically transferred to the 2018 Plan. The activity of stock options consisted of the following: Shares Outstanding Weighted-Average Weighted-Average Aggregate (in thousands, except per share data) Balance as of July 31, 2017 739 15,058 $4.50 5.6 $ 56,717 Increase in 2007 Plan authorized shares 3,333 Increase in 2018 Plan authorized shares 12,700 Shares terminated under 2007 Plan (870 ) RSU activity, net (209 ) Stock options granted (5,021 ) 5,021 $10.02 Stock options exercised — (1,892 ) $3.09 $ 16,688 Repurchases of unvested shares 787 — $5.11 Stock options canceled, forfeited, expired 2,012 (2,012 ) $5.90 Balance as of July 31, 2018 13,471 16,175 $6.20 5.1 $ 470,860 Exercisable and expected to vest as of July 31, 2017 5,907 $3.67 4.9 $ 27,135 Exercisable and expected to vest as of July 31, 2018 5,499 $3.97 4.0 $ 172,317 The aggregate intrinsic value of the options exercised represents the difference between the estimated fair value of our common stock on the date of exercise and their exercise price. The total intrinsic value of options exercised was $16.7 million , $4.5 million and $3.0 million for fiscal 2018 , 2017 and 2016 , respectively. The weighted-average grant-date fair value per share of awards granted was $3.77 , $2.10 and $1.68 for fiscal 2018 , 2017 and 2016 , respectively. We estimated the fair value of employee stock options using the Black-Scholes option pricing model with the following assumptions: Year Ended July 31, 2018 2017 2016 Expected term (in years) 4.6 - 5.1 4.6 4.6 Expected stock price volatility 40.3% - 42.3% 41.4% - 43.3% 43.6% - 45.2% Risk-free interest rate 1.7% - 2.8% 1.1% - 2.0% 1.1% - 1.6% Dividend yield 0.0% 0.0% 0.0% The activity of RSUs consisted of the following: Number of Shares Weighted-Average Grant Date Fair Value per Share Aggregate Intrinsic Value (in thousands, except per share data) Balance as of July 31, 2017 — — $ — Granted 210 $26.26 Vested — — $ — Canceled, forfeited (1 ) $26.26 Balance as of July 31, 2018 209 $26.26 $ 7,394 Early Exercised Stock Options The 2007 Plan allowed for the early exercise of stock options for certain individuals as determined by our board of directors. The consideration received for an early exercised stock option is considered to be a deposit of the exercise price and the related proceed is initially recorded as a liability in the consolidated balance and reclassified to additional paid-in capital as the awards vest. Upon an employee’s termination, we have the option to repurchase unvested shares at a price per share equal to the lesser of the fair market value of the shares at the time of the repurchase or the original purchase price. In fiscal 2018, 2017 and 2016, we issued 179,861 shares, 781,320 shares and 1,260,000 shares of common stock for aggregate proceeds of $0.9 million , $4.7 million and $5.2 million , respectively, related to early exercised stock options. As of July 31, 2018 and 2017, the number of shares of common stock subject to repurchase was 422,528 shares and 1,887,638 shares with an aggregate exercise price of $1.6 million and $8.0 million , respectively. Notes Receivable from Stockholders We entered into notes receivable agreements with certain of our current and former executives and employees in connection with the exercise of their stock options. During fiscal 2016 and 2015, we issued 1,076,666 shares and 2,733,333 shares of common stock for an aggregate exercise price of $4.4 million and $6.6 million , respectively, related to the exercise of unvested stock options via notes receivable. We did not issue notes receivable during fiscal 2018 and 2017. These notes bear interest at rates ranging from 1.15% to 2.85% per annum and are due in December 2018, subject to acceleration upon the occurrence of certain events. As these notes are collateralized by the underlying common stock as well as the borrowers’ personal assets, they are considered full recourse. The related principal amount and accrued interest are presented as a reduction of stockholder's equity (deficit) until the notes are settled. As of July 31, 2018 and 2017, the carrying amount of the outstanding notes receivable, inclusive of accrued interest, was $2.1 million and $7.9 million , respectively. As of July 31, 2018 and 2017, the balance of accrued interest under these notes was $0.1 million and $0.4 million , respectively. In fiscal 2018, we repurchased a total of 787,479 unvested shares of common stock from certain employees upon termination of their employment services. The total repurchase price was $4.0 million , or $5.11 per share, of which $3.8 million was paid in cash and $0.2 million was settled through the cancellation of the related note receivable. In fiscal 2018, certain borrowers repaid the outstanding principal amount and interest accrued under their loans, totaling $5.7 million . Employee Stock Purchase Plan In March 2018, we adopted the Fiscal Year 2018 Employee Stock Purchase Plan ("ESPP"), which became effective upon completion of the IPO. A total of 2,200,000 shares of common stock were initially authorized for issuance under the ESPP. The number of shares of common stock available for sale under the ESPP also includes an annual increase on the first day of each fiscal year beginning on August 1, 2018, equal to the least of: (i) 2,200,000 shares of common stock, (ii) 1% of the outstanding shares of our common stock as of the last day of the immediately preceding fiscal year, or (iii) such other number of shares determined by the administrator. Our compensation committee administers the ESPP. The ESPP provides for consecutive offering periods that will typically have a duration of approximately 24 months in length and is comprised of four purchase periods of approximately six months in length. The offering periods are scheduled to start on the first trading day on or after June 15 and December 15 of each year. The first offering period commenced on March 16, 2018 and is scheduled to end on the first trading day on or after June 15, 2020 . As of July 31, 2018 , no shares of common stock have been issued under the ESPP. The ESPP provides eligible employees with an opportunity to purchase shares of our common stock through payroll deductions of up to 15% of their eligible compensation. A participant may purchase a maximum of 3,000 shares of common stock during a purchase period. Amounts deducted and accumulated by the participant are used to purchase shares of our common stock at the end of each six-month purchase period. The purchase price of the shares shall be 85% of the lower of the fair market value of our common stock on (i) the first trading day of the applicable offering period and (ii) the last trading day of each purchase period in the related offering period. If the fair market value of the common stock on any purchase date within an offering period is lower than the stock price as of the beginning of the offering period, the offering period will immediately reset after the purchase of shares on such purchase date and participants will be automatically re-enrolled in a new offering period. Participants may end their participation at any time during an offering period and will be paid their accrued contributions that have not yet been used to purchase shares of common stock. Participation ends automatically upon termination of employment. The fair value of the purchase rights granted under the ESPP was estimated on the date of grant using the Black-Scholes option pricing model with the following assumptions: Year Ended July 31, 2018 Expected term (in years) 0.5 - 2.3 Expected stock price volatility 30.7% - 53.2% Risk-free interest rate 2.0% - 2.6% Dividend yield 0.0% Stock-based Compensation Expense Prior to fiscal 2018, we recognized stock-based compensation expense, net of estimated forfeitures. Beginning with our first quarter of fiscal 2018, upon adoption of ASU 2016-09, as further discussed in Note 1 to these consolidated financial statements, we elected to account for forfeitures of awards as incurred instead of estimating the number of awards expected to be forfeited. The adoption of this standard did not have a material impact to our consolidated financial statements. The components of stock-based compensation expense recognized in the consolidated statements of operations consisted of the following: Year Ended July 31, 2018 2017 2016 (in thousands) Cost of revenue $ 757 $ 348 $ 189 Sales and marketing 5,044 2,794 1,574 Research and development 3,045 5,574 1,025 General and administrative 2,378 1,203 829 Total stock-based compensation expense $ 11,224 $ 9,919 $ 3,617 As of July 31, 2018 , the unrecognized stock-based compensation cost related to stock options, ESPP and RSUs was $27.0 million , $8.9 million and $5.3 million , respectively, which we expect to amortize over a weighted-average period of 2.9 years , 1.2 years and 3.9 years , respectively. |
Income Taxes
Income Taxes | 12 Months Ended |
Jul. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes On December 22, 2017, the Tax Cuts and Jobs Act of 2017, or the Tax Act, was enacted. The Tax Act contains several key tax provisions that affect us, including, but not limited to, reducing the U.S. federal corporate tax rate from 34% to 21% for tax years beginning after December 31, 2017, imposing a one-time mandatory transition tax on previously untaxed foreign earnings, and changing rules related to uses and limitations of net operating loss carryforwards created in tax years beginning after December 31, 2017. On December 22, 2017, the SAB 118, which provides guidance on accounting for the Tax Act’s impact and allows registrants to record provisional amounts during a measurement period not to extend beyond one year of the enactment date. We currently maintain a full valuation allowance recorded against our U.S. federal deferred tax assets. As such, the provisional $19.7 million remeasurement of our deferred tax assets was offset by the change in our valuation allowance which resulted in no income tax expense or benefit. Because of our full valuation allowance and current year losses, there is no tax expense associated with the provisional $1.0 million of the one-time mandatory transition tax. We are still in the process of analyzing the impacts of the GILTI provision which may impact our effective tax rate in future years. We expect to complete our assessment of the impacts of the Tax Act including the remeasurement of our deferred taxes, the one-time mandatory transition tax, and the policy decision regarding whether to record deferred taxes associated with GILTI within the measurement period provided by SAB 118. Our assessment of the impact of the Tax Act may differ from our provisional assessment during the measurement period due to, among other things, further refinement in our calculations, changes in interpretations and assumptions we have made, or guidance that may be issued. The following table sets forth the geographical breakdown of the income (loss) before the provision for income taxes: Year Ended July 31, 2018 2017 2016 (in thousands) Domestic $ (36,455 ) $ (36,874 ) $ (28,227 ) International 4,146 2,291 1,257 Loss before income taxes $ (32,309 ) $ (34,583 ) $ (26,970 ) The following table sets forth the components of the provision for income taxes: Year Ended July 31, 2018 2017 2016 Current: (in thousands) Federal $ — $ — $ — State (2 ) 31 16 Foreign 1,480 874 452 Total current tax expense 1,478 905 468 Deferred: Federal — — — State — — — Foreign (141 ) (28 ) — Total deferred tax expense (141 ) (28 ) — Total provision for income taxes $ 1,337 $ 877 $ 468 The following table presents the reconciliation of the statutory federal income tax rate to our effective tax rate: Year Ended July 31, 2018 2017 2016 Tax at federal statutory rate 21.0 % 34.0 % 34.0 % State taxes — 1.5 1.8 Impact of foreign rate differential 0.3 (1.7 ) 0.1 Meals and entertainment (1.3 ) (0.5 ) (0.5 ) Stock-based compensation (3.8 ) (2.8 ) (4.1 ) Impact of U.S. tax reform (58.6 ) — — Provision to return adjustments 2.8 (0.3 ) — U.S. tax credits 3.7 — — Change in valuation allowance 33.5 (32.4 ) (32.5 ) Other (1.7 ) (0.3 ) (0.5 ) Effective tax rate (4.1 )% (2.5 )% (1.7 )% Our estimated effective tax rate for the periods presented differs from the U.S. statutory rate primarily due to the benefit of a portion of our earnings being taxed at rates lower than the U.S. statutory rate, offset by the impact of the valuation allowance we maintain against our U.S. federal and state deferred tax assets. The impact of the Tax Act includes the effect of remeasuring our deferred tax assets and liabilities at 21% plus the effects of the one-time mandatory transition tax. The following table presents the tax effects of temporary differences that give rise to significant portions of our deferred tax assets and liabilities: July 31, 2018 2017 (in thousands) Deferred tax assets: Net operating losses carryovers $ 41,794 $ 54,130 Accruals and reserves 2,863 2,807 Deferred revenue 6,071 5,436 Tax credits carryovers 6,118 — Stock-based compensation 784 571 Property and equipment 303 339 Other 347 569 Gross deferred tax assets 58,280 63,852 Less: Valuation allowance (45,578 ) (51,493 ) Total deferred tax assets 12,702 12,359 Deferred tax liabilities: Deferred contract acquisition costs (12,561 ) (12,331 ) Total deferred tax liabilities (12,561 ) (12,331 ) Net deferred tax assets $ 141 $ 28 As a result of certain realization requirements of ASC Topic 718, Compensation-Stock compensation, the table of deferred tax assets and liabilities does not include certain deferred tax assets as of July 31, 2017, that arose directly from tax deductions related to stock-based compensation which was in excess of the amount recognized for financial reporting. Additional paid-in capital will be increased by $0.9 million if and when such deferred tax assets are ultimately realized. As a result of the adoption of ASU 2016-09, as further discussed in Note 1 to these consolidated financial statements, in fiscal 2018 we recognized a U.S. federal and state deferred tax asset for this previously unrecognized excess tax benefits, which was offset by our U.S. federal and state valuation allowance. A deferred tax liability has not been recognized on the excess of the amount for financial reporting over the tax basis of investments in foreign subsidiaries that are indefinitely reinvested outside the U.S. Income taxes are generally incurred upon a repatriation of assets, a sale, or a liquidation of the subsidiary. The excess of the amount for financial reporting over the tax basis in the investments in foreign subsidiaries, as well as the unrecognized deferred tax liability, are not material for the periods presented. The following table presents the change in the valuation allowance: Year Ended July 31, 2018 2017 2016 (in thousands) Balance as of the beginning of the period $ 51,493 $ 40,299 $ 31,483 Change during the period (5,915 ) 11,194 8,816 Balance as of the end of the period $ 45,578 $ 51,493 $ 40,299 The realization of deferred tax assets is dependent upon the generation of sufficient taxable income of the appropriate character in future periods. We regularly assess the ability to realize our deferred tax assets and establish a valuation allowance if it is more-likely-than-not that some portion of the deferred tax assets will not be realized. We weigh all available positive and negative evidence, including our earnings history and results of recent operations, scheduled reversals of deferred tax liabilities, projected future taxable income, and tax planning strategies. Due to the weight of objectively verifiable negative evidence, including our history of losses, we believe that it is more likely than not that our U.S. federal and, state deferred tax assets will not be realized as of July 31, 2018 and 2017 , and as such, we have maintained a full valuation allowance against such deferred tax assets. The amount of the deferred tax asset considered realizable, however, could be adjusted if estimates of future taxable income during the carryforward period are reduced or increased or if objective negative evidence in the form of cumulative losses is no longer present and additional weight may be given to subjective evidence such as our projections for growth. In the event we determine that we will be able to realize all or part of our net deferred tax assets in the future, the valuation allowance against deferred tax assets will be reversed in the period in which we make such determination. The release of a valuation allowance against deferred tax assets may cause greater volatility in the effective tax rate in the periods in which the valuation allowance is released. The valuation allowance against our U.S. federal and state deferred tax assets decreased by $5.9 million , increased by $11.2 million and increased by $8.8 million in fiscal 2018, 2017, and 2016, respectively. The decrease in the valuation allowance in fiscal 2018 was primarily related to the change in the federal statutory rate, while the increase in the valuation allowance in fiscal 2017 and 2016, respectively, was related to tax losses for which insufficient positive evidence exists to support their realizability. As of July 31, 2018 and 2017 , we have net operating loss carryforwards for U.S. federal income tax purposes of $173.6 million and $150.0 million , respectively, which are available to offset future federal taxable income. The net operating losses for federal purposes will begin expiring in 2027 . As of July 31, 2018 and 2017 , we have net operating loss carryforwards for state income tax purposes of $62.4 million and $68.3 million , respectively. The net operating losses for state purposes will begin expiring at different periods beginning in 2024 . As of July 31, 2018, w e had federal and California research and development tax credit carryforwards of approximately $4.5 million and $4.2 million , respectively. If not utilized, the federal credit carryforwards will begin expiring at different periods beginning in 2033 . The California credit will carryforward indefinitely. Federal and state tax laws impose restrictions on the utilization of net operating loss and research and development credit carryforwards in the event of a change in ownership of the Company as defined by the Internal Revenue Code, Sections 382 and 383. Under Section 382 and 383 of the Code, substantial changes in our ownership and the ownership of acquired companies may limit the amount of net operating loss and research and development credit carryforwards that are available to offset taxable income. The annual limitation would not automatically result in the loss of net operating loss or research and development credit carryforwards but may limit the amount available in any given future period. We are subject to income taxes in the U.S. and various foreign jurisdictions. As of July 31, 2018, there are no significant tax jurisdictions under examination; however, all years are open for examination and may become subject to examination in the future. Significant judgment is required in evaluating our tax positions and determining our for income tax expense for the fiscal year. During the ordinary course of business, there are transactions and calculations for which the ultimate tax determination is uncertain. Our estimate of the potential outcome of any tax position is subject to management’s assessment of relevant risks, facts and circumstances existing at that time. These unrecognized tax benefits are established when we believe that certain positions might be challenged despite of belief that our tax return positions are fully supportable. We recognize interest and penalties associated with our unrecognized tax benefits as a component of our income tax expense. For the periods presented, we did not have material interest or penalties associated with the unrecognized tax benefits in the consolidated financial statements. We had $2.6 million of gross unrecognized tax benefits as of July 31, 2018 . If recognized, these would affect our effective tax rate. However, the gross unrecognized tax benefits relate to income tax positions which, if recognized, would be in the form of carryforward deferred tax asset that would be offset by a valuation allowance. As of July 31, 2018, we do not believe that our estimates, as otherwise provided for, on such tax positions will significantly increase or decrease within the next twelve months. The changes in our gross unrecognized tax benefits for fiscal 2018 consisted of the following: Amount (in thousands) Balance as of July 31, 2017 $ — Gross increase for tax positions of prior fiscal years 1,746 Gross increase for tax positions of current fiscal year 876 Balance as of July 31, 2018 $ 2,622 |
Net Loss Per Share Attributable
Net Loss Per Share Attributable to Common Stockholders | 12 Months Ended |
Jul. 31, 2018 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share Attributable to Common Stockholders | Net Loss Per Share Attributable to Common Stockholders Basic and diluted net loss per share attributable to common stockholders is presented in conformity with the two-class method required for participating securities. We consider all series of our convertible preferred stock to be participating securities. Under the two-class method, the net loss attributable to common stockholders is not allocated to the convertible preferred stock as the holders of our convertible preferred stock do not have a contractual obligation to share in our losses. In March 2018, upon completion of our IPO, all shares of convertible preferred stock then outstanding, were automatically converted into an equivalent number of shares of common stock on a one -to-one basis. As of July 31, 2018 , we did not have shares of convertible preferred stock issued and outstanding. Basic net loss per share attributable to common stockholders is computed by dividing the net loss by the weighted-average number of shares of common stock outstanding during the period, less shares subject to repurchase. The diluted net loss per share attributable to common stockholders is computed by giving effect to all potential dilutive common stock equivalents outstanding for the period. For purposes of this calculation, our convertible preferred stock, stock options, early exercised stock options, RSUs and purchase rights granted under the ESPP are considered to be potential common stock equivalents. Since we have reported net losses for all periods presented, we have excluded all potentially dilutive securities from the calculation of the diluted net loss per share attributable to common stockholders as their effect is antidilutive and accordingly, basic and diluted net loss per share attributable to common stockholders is the same for all periods presented. The following table sets forth the computation of basic and diluted net loss per share attributable to common stockholders: Year Ended July 31, 2018 2017 2016 (in thousands, except per share data) Net loss $ (33,646 ) $ (35,460 ) $ (27,438 ) Accretion of Series C and D redeemable convertible preferred stock (6,332 ) (9,570 ) (8,648 ) Net loss attributable to common stockholders $ (39,978 ) $ (45,030 ) $ (36,086 ) Weighted-average shares used in computing net loss per share attributable to common stockholders, basic and diluted 63,881 29,221 26,521 Net loss per share attributable to common stockholders, basic and diluted $ (0.63 ) $ (1.54 ) $ (1.36 ) The following table summarizes the outstanding potentially dilutive securities that were excluded from the computation of diluted net loss per share attributable to common stockholders because the impact of including them would have been antidilutive: July 31, 2018 2017 2016 (in thousands) Convertible preferred stock — 72,501 72,501 Outstanding stock options 16,175 15,058 9,376 Shares subject to repurchase from early exercised stock options 423 1,888 2,367 Purchase rights committed under the ESPP 2,044 — — Unvested RSUs 209 — — Total 18,851 89,447 84,244 |
Segment and Geographic Informat
Segment and Geographic Information | 12 Months Ended |
Jul. 31, 2018 | |
Risks and Uncertainties [Abstract] | |
Segment and Geographic Information | Segment and Geographic Information Our chief operating decision maker ("CODM") is our chief executive officer. We derive our revenue primarily from sales of subscription services to our cloud platform and related support services. Our CODM reviews financial information presented on a consolidated basis for the purposes of allocating resources and evaluating financial performance. Accordingly, we determined that we operate as one operating segment. Our long-lived assets are composed of property and equipment, net, and are summarized by geographic area as follows: July 31, 2018 2017 (in thousands) United States $ 14,742 $ 9,372 Rest of the world 5,023 3,767 Total property and equipment, net $ 19,765 $ 13,139 Refer to Note 1 of these consolidated financial statements for information on revenue by geography. |
401(k) Plan
401(k) Plan | 12 Months Ended |
Jul. 31, 2018 | |
Retirement Benefits [Abstract] | |
401(k) Plan | 401(k) Plan We have a defined-contribution plan intended to qualify under Section 401 of the Internal Revenue Code (the "401(k) Plan"). We contracted with a third-party provider to act as a custodian and trustee, and to process and maintain the records of participant data. Substantially all the expenses incurred for administrating the 401(k) Plan are paid by us, which have not been material to the periods presented. We have not made any matching contributions to date. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Jul. 31, 2018 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions In November 2016 , we recorded $4.4 million of stock-based compensation expense within research and development expense in the consolidated statements of operations associated with a one-time secondary stock purchase transaction which was executed among certain of our employees and certain of our affiliated stockholders, including entities controlled by Jay Chaudhry, our president, chief executive officer and chairman of our board of directors, and Lane Bess, a member of our board of directors. We assessed the impact of this transaction as holders of economic interest in our Company acquired shares from our employees at a price in excess of fair value of such shares. Accordingly, we recognized such excess value as stock-based compensation expense. We have entered into notes receivable agreements with certain of our current and former executives and employees in connection with the exercise of their stock options. Refer to Note 8 of these consolidated financial statements for further information. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Jul. 31, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events In August 2018, we acquired certain artificial intelligence and machine learning technology and the development team of security startup TrustPath Inc. The acquisition extends our ability to derive intelligence from the billions of transactions we process daily, to identify anomalous traffic, build user behavior profiles and detect sophisticated targeted attacks as they emerge. The total purchase consideration was not material to our consolidated financial statements. We are currently evaluating the accounting impact of this transaction as it relates to our adoption of ASU 2017-01. |
Business and Summary of Signi23
Business and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Jul. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Fiscal Year | Fiscal Year Our fiscal year ends on July 31. References to fiscal 2018 , for example, refer to our fiscal year ended July 31, 2018 . |
Principles of Consolidation | Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries and have been prepared in conformity with accounting principles generally accepted in the United States ("U.S. GAAP"). All intercompany balances and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the amounts reported and disclosed in the financial statements and accompanying notes. Such estimates include, but are not limited to, the determination of revenue recognition, deferred revenue, deferred contract acquisition costs, the period of benefit generated from our deferred contract acquisition costs, allowance for doubtful accounts, valuation of common stock options and stock-based awards, useful lives of property and equipment, loss contingencies related to litigation and valuation of deferred tax assets. Management determines these estimates and assumptions on historical experience and on various other assumptions that are believed to be reasonable. Actual results could differ significantly from these estimates, and such differences may be material to the consolidated financial statements. |
Foreign Currency | Foreign Currency The functional currency of our foreign subsidiaries is the U.S. dollar. Accordingly, monetary assets and liabilities of our foreign subsidiaries are re-measured into U.S. dollars at the exchange rates in effect at the reporting date, non-monetary assets and liabilities are re-measured at historical rates, revenue and expenses are re-measured at average exchange rates in effect during each reporting period. Foreign currency transaction gains and losses are recorded in other income (expense), net in the consolidated statements of operations. |
Concentration of Risks | Concentration of Risks We generate revenue primarily from sale of subscriptions to access our cloud platform, together with related support services. Our sales team, along with our channel partner network of global telecommunications service providers, system integrators and value-added resellers (collectively "channel partners"), sells our services worldwide to organizations of all sizes. Due to the nature of our services and the terms and conditions of our contracts with our channel partners, our business could be affected unfavorably if we are not able to continue our relationships with them. Our financial instruments that are exposed to concentrations of credit risk consist primarily of cash, cash equivalents, short-term investments and accounts receivable. Although we deposit our cash with multiple financial institutions, the deposits, at times, may exceed federally insured limits. Cash equivalents and short-term investments consist of highly liquid investments in money market funds, U.S. treasury, U.S. agency securities and corporate debt securities, which are invested through financial institutions in the United States. We grant credit to our customers in the normal course of business. We monitor the financial condition of our customers to reduce credit risk. |
Segment Information | Segment Information We operate as one reportable and operating segment. Our chief operating decision maker is our chief executive officer, who reviews financial information presented on a consolidated basis for purposes of making operating decisions, assessing financial performance and allocating resources. |
Revenue Recognition | Contract Balances Contract liabilities consist of deferred revenue and include payments received in advance of performance under the contract. Such amounts are recognized as revenue over the contractual period. In fiscal 2018 , 2017 and 2016 we recognized revenue of $85.3 million, $58.5 million and $40.7 million, respectively, that was included in the corresponding contract liability balance at the beginning of the related fiscal year. We receive payments from customers based upon contractual billing schedules; accounts receivable are recorded when the right to consideration becomes unconditional. Payment terms on invoiced amounts are typically 30 days but it may be up to 90 days for some of our channel partners. Contract assets include amounts related to our contractual right to consideration for both completed and partially completed performance obligations that may not have been invoiced and such amounts have historically not been material. Remaining Performance Obligations The typical subscription and support term is one to three years. Most of our subscription and support contracts are non-cancelable over the contractual term. However, customers typically have the right to terminate their contracts for cause, if we fail to perform. As of July 31, 2018 , the aggregate amount of the transaction price allocated to remaining performance obligations was $397.9 million. We expect to recognize 53% of the transaction price over the next 12 months and 96% of the transaction price over the next three years, with the remainder recognized thereafter. Costs to Obtain and Fulfill a Contract We capitalize sales commission and associated payroll taxes paid to internal sales personnel that are incremental to the acquisition of channel partner and direct customer contracts. These costs are recorded as deferred contract acquisition costs in the consolidated balance sheets. We determine whether costs should be deferred based on our sales compensation plans, if the commissions are in fact incremental and would not have occurred absent the customer contract. Sales commissions for renewal of a contract are not considered commensurate with the commissions paid for the acquisition of the initial contract given the substantive difference in commission rates in proportion to their respective contract values. Commissions paid upon the initial acquisition of a contract are amortized over an estimated period of benefit of five years while commissions paid for renewal contracts are amortized over the contractual term of the renewals. Amortization of deferred contract acquisition costs is recognized on a straight-line basis commensurate with the pattern of revenue recognition and included in sales and marketing expense in the consolidated statements of operations. We determine the period of benefit for commissions paid for the acquisition of the initial contract by taking into consideration the expected subscription term and expected renewals of our customer contracts, the duration of our relationships with our customers, customer retention data, our technology development lifecycle and other factors. We periodically review the carrying amount of deferred contract acquisition costs to determine whether events or changes in circumstances have occurred that could impact the period of benefit of these deferred costs. We did not recognize any impairment losses of deferred contract acquisition costs during the periods presented. Revenue Recognition We have adopted Accounting Standards Codification ("ASC") Topic 606, Revenue From Contracts With Customers ("ASC 606"), effective as of August 1, 2017, using the full retrospective transition method. Under this method, we are presenting the consolidated financial statements for fiscal 2016, as if ASC 606 had been effective for that period as well. In accordance with ASC 606, revenue is recognized when a customer obtains control of promised services. The amount of revenue recognized reflects the consideration that we expect to be entitled to receive in exchange for these services. To achieve the core principle of this standard, we apply the following five steps: 1) Identify the contract with a customer We consider the terms and conditions of the contracts and our customary business practices in identifying our contracts under ASC 606. We determine we have a contract with a customer when the contract is approved, we can identify each party’s rights regarding the services to be transferred, we can identify the payment terms for the services, we have determined the customer has the ability and intent to pay and the contract has commercial substance. We apply judgment in determining the customer’s ability and intent to pay, which is based on a variety of factors, including the customer’s historical payment experience or, in the case of a new customer, credit and financial information pertaining to the customer. 2) Identify the performance obligations in the contract Performance obligations promised in a contract are identified based on the services that will be transferred to the customer that are both capable of being distinct, whereby the customer can benefit from the service either on its own or together with other resources that are readily available from third parties or from us, and are distinct in the context of the contract, whereby the transfer of the services is separately identifiable from other promises in the contract. Our performance obligations consist of (i) our subscription and support services and (ii) professional and other services. 3) Determine the transaction price The transaction price is determined based on the consideration to which we expect to be entitled in exchange for transferring services to the customer. Variable consideration is included in the transaction price if, in our judgment, it is probable that a significant future reversal of cumulative revenue under the contract will not occur. None of our contracts contain a significant financing component. 4) Allocate the transaction price to performance obligations in the contract If the contract contains a single performance obligation, the entire transaction price is allocated to the single performance obligation. Contracts that contain multiple performance obligations require an allocation of the transaction price to each performance obligation based on a relative standalone selling price ("SSP"). 5) Recognize revenue when or as we satisfy a performance obligation Revenue is recognized at the time the related performance obligation is satisfied by transferring the promised service to a customer. Revenue is recognized when control of the services is transferred to our customers, in an amount that reflects the consideration that we expect to receive in exchange for those services. We generate all our revenue from contracts with customers. Subscription and Support Revenue We generate revenue primarily from sales of subscriptions to access our cloud platform, together with related support services to our customers. Arrangements with customers do not provide the customer with the right to take possession of our software operating our cloud platform at any time. Instead, customers are granted continuous access to our cloud platform over the contractual period. A time-elapsed output method is used to measure progress because we transfer control evenly over the contractual period. Accordingly, the fixed consideration related to subscription and support revenue is generally recognized on a straight-line basis over the contract term beginning on the date that our service is made available to the customer. The typical subscription and support term is one to three years. Most of our contracts are non-cancelable over the contractual term. Customers typically have the right to terminate their contracts for cause if we fail to perform in accordance with the contractual terms. Some of our customers have the option to purchase additional subscription and support services at a stated price. These options generally do not provide a material right as they are priced at our SSP. Professional and Other Services Revenue Professional and other services revenue consists of fees associated with providing deployment advisory services that educate and assist our customers on the best use of our solutions, as well as advise customers on best practices as they deploy our solution. These services are distinct from subscription and support services. Professional services do not result in significant customization of the subscription service. Revenue from professional services provided on a time and materials basis is recognized as the services are performed. Total professional and other services revenue has historically not been material. Contracts with Multiple Performance Obligations Most of our contracts with customers contain multiple promised services consisting of: (i) our subscription and support services and (ii) professional and other services that are distinct and accounted for separately. The transaction price is allocated to the separate performance obligations on a relative SSP basis. We determine SSP based on our overall pricing objectives, taking into consideration the type of subscription and support services and professional and other services, the geographical region of the customer and the number of users. Variable Consideration Revenue from sales is recorded at the net sales price, which is the transaction price, and includes estimates of variable consideration. The amount of variable consideration that is included in the transaction price is constrained and is included in the net sales price only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue will not occur when the uncertainty is resolved. If our services do not meet certain service level commitments, our customers are entitled to receive service credits, and in certain cases, refunds, each representing a form of variable consideration. We have historically not experienced any significant incidents affecting the defined levels of reliability and performance as required by our subscription contracts. Accordingly, estimated refunds related to these agreements were not material to the periods presented. We provide rebates and other credits within our contracts with certain customers, which are estimated based on the value expected to be earned or claimed on the related sales transaction. Overall, the transaction price is reduced to reflect our estimate of the amount of consideration to which we are entitled based on the terms of the contract. Estimated rebates and other credits were not material during the periods presented. |
Accounts Receivable and Allowance | Accounts Receivable and Allowance Accounts receivable are recorded at the invoiced amount and are non-interest bearing. Accounts receivable are stated at their net realizable value, net of an allowance for doubtful accounts. We have a well-established collections history from our customers. Credit is extended to customers based on an evaluation of their financial condition and other factors. In determining the necessary allowance for doubtful accounts, management considers the current aging and financial condition of our customers, the amount of receivables in dispute and current payment patterns. |
Cash Equivalents | We classify all highly liquid investments purchased with an original maturity of 90 days or less from the date of purchase as cash equivalents and all highly liquid investments with original maturities beyond 90 days at the time of purchase as short-term investments. Our cash equivalents and short-term investments consist of highly liquid investments in money market funds, U.S. treasury securities, U.S. government agency securities and corporate debt securities. |
Short-Term Investments | We classify our investments as available-for-sale investments and present them within current assets since these investments represent funds available for current operations and we have the ability and intent, if necessary, to liquidate any of these investments in order to meet our liquidity needs within the next 12 months. Our investments are carried at fair value, with unrealized gains and losses, net of tax, reported in accumulated other comprehensive loss within stockholders’ equity (deficit). Our investments are reviewed periodically to determine whether a decline in a security’s fair value below the amortized cost basis is other-than-temporary. If the cost of an individual investment exceeds its fair value, we consider available quantitative and qualitative factors such as the length of time and extent to which the market value has been less than the cost, the financial condition and near-term prospects of the issuer and our intent to sell, or whether it is more likely than not we will be required to sell the investment before recovery of the investment’s amortized cost basis. If we believe that a decline in fair value is determined to be other-than-temporary, we write down these investments to fair value. There were no impairments recognized on our investments during the periods presented. Interest income, amortization of premiums and discounts, realized gains and losses and declines in fair value judged to be other-than-temporary on our available-for-sale securities are included in interest income, net in the consolidated statements of operations. We use the specific identification method to determine the cost in calculating realized gains and losses upon the sale of these investments. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Our financial instruments consist of cash equivalents, short-term investments, accounts receivable, accounts payable and accrued liabilities. Cash equivalents and short-term investments are recorded at fair value. Accounts receivable, accounts payable and accrued liabilities are stated at their carrying value, which approximates fair value due to the short-time to the expected receipt or payment date. Assets recorded at fair value on a recurring basis in the consolidated balance sheets, consisting of cash equivalents and short-term investments, are categorized in accordance with the fair value hierarchy based upon the level of judgment associated with the inputs used to measure their fair values. |
Restricted Cash | Restricted Cash We maintained restricted cash of $0.6 million as of July 31, 2018 and 2017 through a letter of credit. The letter of credit was established according to the requirements under certain lease agreements |
Property and Equipment | Property and Equipment Property and equipment, net are stated at historical cost net of accumulated depreciation. Property and equipment, excluding leasehold improvements, are depreciated using the straight-line method over the estimated useful lives of the respective assets, generally ranging from two to five years. Leasehold improvements are amortized using the straight-line method over the shorter of the estimated useful lives of the respective assets or the lease term. Expenditures for maintenance and repairs are expensed as incurred and significant improvements and betterments that substantially enhance the life of an asset are capitalized. |
Capitalized Internal-Use Software Development Costs | Capitalized Internal-Use Software Development Costs We capitalize certain development costs related to our cloud security platform during the application development stage. Costs related to preliminary project activities are analogous to research and development activities and are expensed as incurred. The preliminary stage includes such activities as conceptual formulation of alternatives, 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 software is substantially complete and ready for its intended use. Capitalized costs are recorded as part of property and equipment, net. Maintenance and training costs are expensed as incurred. Capitalized internal-use software is amortized on a straight-line basis over its estimated useful life, which is generally three years, and is recorded as cost of revenue in the consolidated statements of operations. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets We review our long-lived assets, comprised primarily of our property and equipment, for impairment whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. We measure the recoverability of these assets by comparing the carrying amounts to the future undiscounted cash flows these assets are expected to generate. If the total of the future undiscounted cash flows are less than the carrying amount of an asset, we record an impairment charge for the amount by which the carrying amount of the asset exceeds the fair value. |
Deferred Offering Costs | Deferred Offering Costs Deferred offering costs consisted of fees and expenses incurred in connection with the anticipated sale of our common stock in an IPO, including legal, accounting, printing and other IPO-related costs. |
Leases | Leases We lease our facilities under operating lease agreements and recognize related rent expense on a straight-line basis over the term of the lease. Some of our lease agreements contain rent holidays, scheduled rent increases, lease incentives and renewal options. Rent holidays and scheduled rent increases are included in the determination of rent expense to be recorded over the lease term. Lease incentives are recognized as a reduction of rent expense on a straight-line basis over the term of the lease. Renewals are not assumed in the determination of the lease term unless they are deemed to be reasonably assured at the inception of the lease. We begin recognizing rent expense on the date that we obtain the legal right to use and control of the leased space. |
Stock-Based Compensation | Stock-Based Compensation Stock-based compensation expense for common stock options granted to employees and non-employees is recognized based on the fair value of the awards granted, determined using the Black-Scholes option pricing model and a single option award approach. Stock‐based compensation expense is recognized as expense over the requisite service period, generally four years. Unvested options issued to non-employees are remeasured at fair market value at the end of each reporting period. Stock-based compensation expense related to purchase rights granted under the employee stock purchase plan is based on the Black-Scholes option pricing model fair value of the number of awards estimated as of the beginning of the offering period. Stock-based compensation expense is recognized following the straight-line attribution method over the offering period. Prior to the IPO, the fair value of our common stock for financial reporting purposes was determined considering numerous objective and subjective factors and required judgment to determine the fair value of common stock as of each grant date. Subsequent to the IPO, we determine the fair value using the market closing price of our common stock on the date of grant. Prior to fiscal 2018, we recognized stock-based compensation expense, net of estimated forfeitures. We used historical data to estimate pre-vesting forfeitures and recorded stock-based compensation expense only for those grants that were expected to vest. On August 1, 2017, we adopted Accounting Standard Update ("ASU") No. 2016-09, Compensation—Stock Compensation: Improvements to Employee Share-Based Payment Accounting ("ASU 2016-09"), which simplifies several aspects of the accounting for employee share-based payment transactions. In accordance with ASU 2016-09, we have elected to account for forfeitures as they occur instead of estimating the number of awards expected to be forfeited and adjusting the estimate when it is no longer probable that the employee will fulfill the service condition. We adopted this provision in our first quarter of fiscal 2018 and recorded a cumulative-effect adjustment to accumulated deficit of $0.4 million , net of tax, as of the date of adoption. Additionally, upon adoption of ASU 2016-09, on a modified retrospective basis, the previously unrecognized excess tax benefits of $0.9 million as of July 31, 2017 were recorded as an increase of U.S. federal and state deferred tax assets, which was substantially offset by our valuation allowance. Prospectively, all excess tax benefits and deficiencies will be recognized in the income statement as a component of our income tax expense or benefit. Further, we will present excess tax benefits as an operating activity in the consolidated statements of cash flows on a prospective basis. |
Research and Development | Research and Development Our research and development expenses support our efforts to add new features to our existing offerings and to ensure the reliability, availability and scalability of our solutions. Our cloud platform is software-driven, and our research and development teams employ software engineers in the design and the related development, testing, certification and support of our solutions. Accordingly, the majority of our research and development expenses result from employee-related costs, including salaries, bonuses and benefits and costs associated with technology tools used by our engineers. |
Advertising Expenses | Advertising Expenses Advertising expenses are charged to sales and marketing expense in the consolidated statements of operations as incurred. |
Warranties and Indemnification | Warranties and Indemnification Our cloud platform is generally warranted to be free of defects under normal use and to perform substantially in accordance with the subscription agreement. Additionally, our contracts generally include provisions for indemnifying customers and channel partners against liabilities if our services infringe or misappropriate a third party’s intellectual property rights. Costs and liabilities incurred as a result of warranties and indemnification obligations were not material during the periods presented. |
Legal Contingencies | Legal Contingencies We may be subject to legal proceedings and litigation arising from time to time. We record a liability when we believe that it is both probable that a loss has been incurred and the amount can be reasonably estimated. We expect to periodically evaluate developments in our legal matters that could affect the amount of liability that we accrue, if any, and adjust, as appropriate. Until the final resolution of any such matter for which we may be required to record a liability, there may be a loss exposure in excess of the liability recorded and such amount could be significant. We expense legal fees as incurred. |
Income Taxes | Income Taxes We account for income taxes using the asset and liability method. Deferred income taxes are recognized by applying the enacted statutory tax rates applicable to future years to differences between the carrying amounts of existing assets and liabilities and their respective tax bases and net operating loss and tax credit carryforwards. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the period that includes the enactment date. The measurement of deferred tax assets is reduced, if necessary, by a valuation allowance to amounts that are more likely than not to be realized. We recognize tax benefits from uncertain tax positions only if we believe that it is more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position. The tax benefits recognized in the financial statements from such positions are then measured based on the largest benefit that has a greater than 50% likelihood of being realized upon settlement. On December 22, 2017, the Tax Cuts and Jobs Act of 2017, or the Tax Act, was enacted. The Tax Act contains several key tax provisions that affect us, including, but not limited to, reducing the U.S. federal corporate tax rate, imposing a one-time mandatory repatriation tax on previously untaxed foreign earnings, and changing rules related to the use of net operating loss carryforwards created in tax years beginning after December 31, 2017. We expect to complete our assessment of the impacts of the Tax Act including the remeasurement of our deferred taxes, the one-time mandatory transition tax, and the policy decision regarding whether to record deferred taxes associated with Global Intangible Low-Taxed Income (“GILTI”) within the measurement period provided by Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act ("SAB 118"). Our assessment of the impact of the Tax Act may differ from our provisional assessment during the measurement period due to, among other things, further refinement in our calculations, changes in interpretations and assumptions we have made, or guidance that may be issued. |
Comprehensive Loss | Comprehensive Loss Our other comprehensive loss consists of unrealized gains and losses on our available-for-sale investments. |
Net Loss Per Share Attributable to Common Stockholders | Net Loss Per Share Attributable to Common Stockholders Prior to the IPO, basic and diluted net loss per share attributable to common stockholders is presented in conformity with the two-class method required for participating securities. We consider all series of our convertible preferred stock to be participating securities. Under the two-class method, the net loss attributable to common stockholders is not allocated to the convertible preferred stock as the holders of our convertible preferred stock do not have a contractual obligation to share in our losses. Under the two-class method, net income is attributed to common stockholders and participating securities based on their participation rights. Under the two-class method, basic net loss per share attributable to common stockholders is computed by dividing the net loss attributable to common stockholders by the weighted-average number of shares of common stock outstanding during the period. Net loss attributable to common stockholders is calculated by adjusting the net loss for the accretion of redeemable convertible preferred stock outstanding during the period. Diluted earnings per share attributable to common stockholders adjusts basic earnings per share for all potentially dilutive common stock equivalents outstanding during the period. Potentially dilutive securities consist of convertible preferred stock, stock options, shares subject to repurchase from early exercised stock options and estimated shares to be issued under the employee stock purchase plan. Since we have reported net losses for all periods presented, we have excluded all potentially dilutive securities from the calculation of the diluted net loss per share attributable to common stockholders as their effect is antidilutive and accordingly, basic and diluted net loss per share attributable to common stockholders is the same for all periods presented. Upon closing of the IPO, all shares of convertible preferred stock then outstanding were automatically converted into an equivalent number of shares of common stock on a one -to-one basis and their carrying amount reclassified into stockholders’ equity (deficit). |
Recently Adopted Accounting Pronouncements; Recently Issued Accounting Pronouncements Not Yet Adopted | Recently Adopted Accounting Pronouncements In March 2016, the Financial Accounting Standard Board ("FASB") issued ASU 2016-09. This ASU simplifies various aspects related to how share-based payments are accounted for and presented in the financial statements, including income taxes, forfeitures, and statutory tax withholding requirements. For public business entities, it is effective for annual periods beginning after December 15, 2016, and interim periods therein. Early adoption is permitted. We adopted ASU 2016-09 as of August 1, 2017, resulting in the impact discussed above, under the caption "Stock-Based Compensation." The adoption of this standard did not have a material impact to our consolidated financial statements. In January 2017, FASB issued ASU No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business . The amendment was issued to clarify the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions of assets or businesses. The amendments in this ASU provide a screen to determine when a set (inputs and processes that produce an output) is not a business. The screen requires that when substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets, the set is not a business. For public business entities, it is effective for fiscal years beginning after December 15, 2017. We adopted this standard as of August 1, 2018; however, we are currently evaluating the impact it will have on our consolidated financial statements in relation to transactions entered after its adoption. In May 2017, the FASB issued ASU No. 2017-09, Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting , which provides clarity in applying the guidance in Topic 718 around modifications of share-based payment awards. For public business entities, it is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. We adopted this standard as of August 1, 2018 and do not expect it to have a material impact to our consolidated financial statements. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments . The new standard will make eight targeted changes to how cash receipts and cash payments are presented and classified in the statement of cash flows with the purpose of decreasing the diversity in practice in how certain cash receipts and payments are classified in the statement of cash flows. For public business entities, it is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. We adopted this standard as of August 1, 2018 and do not expect it to have a material impact to our consolidated financial statements. In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash , which updates the classification of restricted cash in the statement of cash flows. For public business entities, it is effective for fiscal years beginning after December 15, 2017, and interim periods therein. We adopted this standard as of August 1, 2018 and do not expect it to have a material impact to our consolidated financial statements. Recently Issued Accounting Pronouncements Not Yet Adopted In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) ("ASU 2016-02"). The main difference between previous guidance and ASU 2016-02 is the recognition of lease assets and lease liabilities by lessees for those leases classified as operating leases under previous accounting guidance. ASU 2016-02 retains the distinction between finance leases and operating leases. The classification criteria for distinguishing between finance leases and operating leases are substantially similar to the previous leases guidance. In transition, lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. For public business entities, it is effective for annual periods beginning after December 15, 2018, and interim periods therein. Early adoption is permitted. We are currently evaluating the potential impact of this standard on our consolidated financial statements. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments . This ASU amends guidance on reporting credit losses for assets held at amortized cost basis and available-for-sale debt securities to require that credit losses on available-for-sale debt securities be presented as an allowance rather than as a write-down. The measurement of credit losses for newly recognized financial assets and subsequent changes in the allowance for credit losses are recorded in the statements of operations. For public business entities, it is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted. We are currently evaluating the potential impact of this standard on our consolidated financial statements. In June 2018, the FASB issued ASU No. 2018-07, Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting , which simplifies the accounting for equity awards granted to nonemployees. For public business entities, it is effective for fiscal years beginning after December 15, 2018, and interim periods therein. Early adoption is permitted. We are currently evaluating the potential impact of this standard on our consolidated financial statements. |
Business and Summary of Signi24
Business and Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Jul. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Accounts Receivable | The following table summarizes the concentration of 10% or more of the total balance of accounts receivable, net: July 31, 2018 2017 Channel partner A 13 % * Channel partner B 13 % * Channel partner C * 17 % Channel partner D * 10 % Channel partner E * 15 % _____________ * Represents less than 10%. |
Disaggregation of Revenue | The following table summarizes the revenue by region based on the shipping address of customers who have contracted to use our cloud platform: Year Ended July 31, 2018 2017 2016 Amount % Revenue Amount % Revenue Amount % Revenue (in thousands, except for percentage data) United States $ 86,123 45 % $ 57,990 46 % $ 35,794 44 % Europe, Middle East and Africa (*) 84,828 45 56,857 45 37,403 47 Asia Pacific 14,465 8 9,853 8 5,779 7 Other 4,758 2 1,017 1 1,349 2 Total $ 190,174 100 % $ 125,717 100 % $ 80,325 100 % _____ (*) Revenue from the United Kingdom represented 11% , 13% and 12% of the total revenue for fiscal 2018, 2017 and 2016, respectively. The following table summarizes the revenue from contracts by type of customer: Year Ended July 31, 2018 2017 2016 Amount % Revenue Amount % Revenue Amount % Revenue (in thousands, except for percentage data) Channel partners $ 175,798 92 % $ 110,900 88 % $ 67,472 84 % Direct customers 14,376 8 14,817 12 12,853 16 Total $ 190,174 100 % $ 125,717 100 % $ 80,325 100 % |
Capitalized Contract Cost | The following table summarizes the activity of the deferred contract acquisition costs: Year Ended July 31, 2018 2017 2016 (in thousands) Beginning balance $ 34,662 $ 21,137 $ 13,150 Capitalization of contract acquisition costs 34,429 21,999 13,502 Amortization of deferred contract acquisition costs (13,181 ) (8,474 ) (5,515 ) Ending balance $ 55,910 $ 34,662 $ 21,137 Deferred contract acquisition costs $ 16,136 $ 10,469 $ 6,743 Deferred contract acquisition costs, noncurrent 39,774 24,193 14,394 Total deferred contract acquisition costs $ 55,910 $ 34,662 $ 21,137 |
Cash Equivalents and Short-Te25
Cash Equivalents and Short-Term Investments (Tables) | 12 Months Ended |
Jul. 31, 2018 | |
Cash and Cash Equivalents [Abstract] | |
Schedule of Cash Equivalents and Short-Term Investments | Cash equivalents and short-term investments consisted of the following as of July 31, 2018 : Amortized Unrealized Unrealized (in thousands) Cash equivalents: Money market funds $ 74,408 $ — $ — $ 74,408 U.S. treasury securities 17,488 — — 17,488 U.S. government agency securities 1,999 — — 1,999 Corporate debt securities 11,010 — (1 ) 11,009 Total cash equivalents $ 104,905 $ — $ (1 ) $ 104,904 Short-term investments: U.S. treasury securities $ 55,768 $ — $ (17 ) $ 55,751 U.S. government agency securities 17,953 — (19 ) 17,934 Corporate debt securities 89,362 1 (88 ) 89,275 Total short-term investments $ 163,083 $ 1 $ (124 ) $ 162,960 Total cash equivalents and short-term investments $ 267,988 $ 1 $ (125 ) $ 267,864 Cash equivalents consisted of the following as of July 31, 2017 : Amortized Unrealized Unrealized (in thousands) Cash equivalents: Money market funds $ 72,441 $ — $ — $ 72,441 |
Schedule of Maturities | The amortized cost and fair value of our short-term investments based on their stated maturities consisted of the following as of July 31, 2018 : Amortized Cost Fair Value (in thousands) Due within one year $ 116,897 $ 116,843 Due between one and two years 46,186 46,117 Total short-term investments $ 163,083 $ 162,960 |
Schedule of Unrealized Loss on Investments | that were in an unrealized loss position consisted of the following as of July 31, 2018 : Less than 12 Months Greater than 12 Months Total Fair Unrealized Fair Unrealized Fair Unrealized (in thousands) U.S. treasury securities $ 55,750 $ (17 ) $ — $ — $ 55,750 $ (17 ) U.S. government agency securities 17,934 (19 ) — — 17,934 (19 ) Corporate debt securities 83,332 (88 ) — — 83,332 (88 ) Total investments in a loss position $ 157,016 $ (124 ) $ — $ — $ 157,016 $ (124 ) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Jul. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets Measured on Recurring Basis | Assets that are measured at fair value on a recurring basis consisted of the following as of July 31, 2018 : Level I Level II Level III Total Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs (in thousands) Cash equivalents: Money market funds $ 74,408 $ 74,408 $ — $ — U.S. treasury securities 17,488 — 17,488 — U.S. government agency securities 1,999 — 1,999 — Corporate debt securities 11,009 — 11,009 — Total cash equivalents $ 104,904 $ 74,408 $ 30,496 $ — Short-term investments: U.S. treasury securities $ 55,751 $ — $ 55,751 $ — U.S. government agency securities 17,934 — 17,934 — Corporate debt securities 89,275 — 89,275 — Total short-term investments $ 162,960 $ — $ 162,960 $ — Assets that are measured at fair value on a recurring basis consisted of the following as of July 31, 2017 : Level I Level II Level III Total Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs (in thousands) Cash equivalents: Money market funds $ 72,441 $ 72,441 $ — $ — |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Jul. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Property and equipment consisted of the following: July 31, Estimated Useful Life 2018 2017 (in thousands) Hosting equipment 2-3 years $ 30,743 $ 20,241 Computers and equipment 3-5 years 2,335 1,539 Purchased software 3 years 1,324 1,257 Capitalized internal-use software 3 years 6,163 4,390 Furniture and fixtures 5 years 1,478 1,035 Leasehold improvements Shorter of useful life or lease term 2,123 1,981 Property and equipment, gross 44,166 30,443 Less: Accumulated depreciation and amortization (24,401 ) (17,304 ) Total property and equipment, net $ 19,765 $ 13,139 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Jul. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Rental Payments for Operating Leases | Future minimum payments under non-cancelable operating leases consisted of the following as of July 31, 2018 : Operating (in thousands) Year ending July 31, 2019 $ 2,834 2020 2,274 2021 1,598 Total $ 6,706 |
Schedule of Future Minimum Payments for Other Commitments | Future minimum payments under non-cancelable data center contracts consisted of the following as of July 31, 2018 : Data Center (in thousands) Year ending July 31, 2019 $ 6,280 2020 3,763 2021 1,300 2022 179 Total $ 11,522 |
Convertible Preferred Stock (Ta
Convertible Preferred Stock (Tables) | 12 Months Ended |
Jul. 31, 2018 | |
Temporary Equity Disclosure [Abstract] | |
Schedule of Convertible Preferred Stock | Convertible preferred stock consisted of the following as of July 31, 2017: Shares Authorized Issued and Outstanding Carrying Value Liquidation Preference Issue Price per Share (in thousands, except per share data) Series A 28,000 28,000 $ 5,000 $ 5,000 $ 0.18 Series B 25,000 24,856 30,095 30,200 $ 1.22 Series C 7,500 7,375 37,897 37,980 $ 5.15 Series D 12,600 12,270 127,985 128,196 $ 8.97 Total 73,100 72,501 $ 200,977 $ 201,376 |
Common Stock (Tables)
Common Stock (Tables) | 12 Months Ended |
Jul. 31, 2018 | |
Equity [Abstract] | |
Schedule of Common Stock | The following table summarizes our shares of common stock reserved for future issuance: July 31, 2018 (in thousands) Equity awards outstanding: Stock options 16,175 Unvested restricted stock units 209 Purchase rights committed under the employee stock purchase plan 2,044 Equity awards available for future grants: Equity incentive plans 13,471 Employee stock purchase plan 156 Total reserved shares of common stock for future issuance 32,055 |
Stock Based Compensation (Table
Stock Based Compensation (Tables) | 12 Months Ended |
Jul. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of Stock Options | The activity of stock options consisted of the following: Shares Outstanding Weighted-Average Weighted-Average Aggregate (in thousands, except per share data) Balance as of July 31, 2017 739 15,058 $4.50 5.6 $ 56,717 Increase in 2007 Plan authorized shares 3,333 Increase in 2018 Plan authorized shares 12,700 Shares terminated under 2007 Plan (870 ) RSU activity, net (209 ) Stock options granted (5,021 ) 5,021 $10.02 Stock options exercised — (1,892 ) $3.09 $ 16,688 Repurchases of unvested shares 787 — $5.11 Stock options canceled, forfeited, expired 2,012 (2,012 ) $5.90 Balance as of July 31, 2018 13,471 16,175 $6.20 5.1 $ 470,860 Exercisable and expected to vest as of July 31, 2017 5,907 $3.67 4.9 $ 27,135 Exercisable and expected to vest as of July 31, 2018 5,499 $3.97 4.0 $ 172,317 |
Schedule of Allocation of Stock-based Compensation Expense | The components of stock-based compensation expense recognized in the consolidated statements of operations consisted of the following: Year Ended July 31, 2018 2017 2016 (in thousands) Cost of revenue $ 757 $ 348 $ 189 Sales and marketing 5,044 2,794 1,574 Research and development 3,045 5,574 1,025 General and administrative 2,378 1,203 829 Total stock-based compensation expense $ 11,224 $ 9,919 $ 3,617 |
Schedule of Restricted Stock Units Activity | The activity of RSUs consisted of the following: Number of Shares Weighted-Average Grant Date Fair Value per Share Aggregate Intrinsic Value (in thousands, except per share data) Balance as of July 31, 2017 — — $ — Granted 210 $26.26 Vested — — $ — Canceled, forfeited (1 ) $26.26 Balance as of July 31, 2018 209 $26.26 $ 7,394 |
Employee Stock Option | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of Valuation Assumptions | We estimated the fair value of employee stock options using the Black-Scholes option pricing model with the following assumptions: Year Ended July 31, 2018 2017 2016 Expected term (in years) 4.6 - 5.1 4.6 4.6 Expected stock price volatility 40.3% - 42.3% 41.4% - 43.3% 43.6% - 45.2% Risk-free interest rate 1.7% - 2.8% 1.1% - 2.0% 1.1% - 1.6% Dividend yield 0.0% 0.0% 0.0% |
Employee Stock | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of ESPP Valuation Assumptions | The fair value of the purchase rights granted under the ESPP was estimated on the date of grant using the Black-Scholes option pricing model with the following assumptions: Year Ended July 31, 2018 Expected term (in years) 0.5 - 2.3 Expected stock price volatility 30.7% - 53.2% Risk-free interest rate 2.0% - 2.6% Dividend yield 0.0% |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Jul. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income before Income Tax, Domestic and Foreign | The following table sets forth the geographical breakdown of the income (loss) before the provision for income taxes: Year Ended July 31, 2018 2017 2016 (in thousands) Domestic $ (36,455 ) $ (36,874 ) $ (28,227 ) International 4,146 2,291 1,257 Loss before income taxes $ (32,309 ) $ (34,583 ) $ (26,970 ) |
Schedule of Components of Income Tax Expense (Benefit) | The following table sets forth the components of the provision for income taxes: Year Ended July 31, 2018 2017 2016 Current: (in thousands) Federal $ — $ — $ — State (2 ) 31 16 Foreign 1,480 874 452 Total current tax expense 1,478 905 468 Deferred: Federal — — — State — — — Foreign (141 ) (28 ) — Total deferred tax expense (141 ) (28 ) — Total provision for income taxes $ 1,337 $ 877 $ 468 |
Schedule of Effective Income Tax Rate Reconciliation | The following table presents the reconciliation of the statutory federal income tax rate to our effective tax rate: Year Ended July 31, 2018 2017 2016 Tax at federal statutory rate 21.0 % 34.0 % 34.0 % State taxes — 1.5 1.8 Impact of foreign rate differential 0.3 (1.7 ) 0.1 Meals and entertainment (1.3 ) (0.5 ) (0.5 ) Stock-based compensation (3.8 ) (2.8 ) (4.1 ) Impact of U.S. tax reform (58.6 ) — — Provision to return adjustments 2.8 (0.3 ) — U.S. tax credits 3.7 — — Change in valuation allowance 33.5 (32.4 ) (32.5 ) Other (1.7 ) (0.3 ) (0.5 ) Effective tax rate (4.1 )% (2.5 )% (1.7 )% |
Schedule of Deferred Tax Assets and Liabilities | The following table presents the tax effects of temporary differences that give rise to significant portions of our deferred tax assets and liabilities: July 31, 2018 2017 (in thousands) Deferred tax assets: Net operating losses carryovers $ 41,794 $ 54,130 Accruals and reserves 2,863 2,807 Deferred revenue 6,071 5,436 Tax credits carryovers 6,118 — Stock-based compensation 784 571 Property and equipment 303 339 Other 347 569 Gross deferred tax assets 58,280 63,852 Less: Valuation allowance (45,578 ) (51,493 ) Total deferred tax assets 12,702 12,359 Deferred tax liabilities: Deferred contract acquisition costs (12,561 ) (12,331 ) Total deferred tax liabilities (12,561 ) (12,331 ) Net deferred tax assets $ 141 $ 28 |
Summary of Valuation Allowance | The following table presents the change in the valuation allowance: Year Ended July 31, 2018 2017 2016 (in thousands) Balance as of the beginning of the period $ 51,493 $ 40,299 $ 31,483 Change during the period (5,915 ) 11,194 8,816 Balance as of the end of the period $ 45,578 $ 51,493 $ 40,299 |
Schedule of Unrecognized Tax Benefits Roll Forward | The changes in our gross unrecognized tax benefits for fiscal 2018 consisted of the following: Amount (in thousands) Balance as of July 31, 2017 $ — Gross increase for tax positions of prior fiscal years 1,746 Gross increase for tax positions of current fiscal year 876 Balance as of July 31, 2018 $ 2,622 |
Net Loss Per Share Attributab33
Net Loss Per Share Attributable to Common Stockholders (Tables) | 12 Months Ended |
Jul. 31, 2018 | |
Earnings Per Share [Abstract] | |
Schedule of Net Loss Per Share, Basic and Diluted | The following table sets forth the computation of basic and diluted net loss per share attributable to common stockholders: Year Ended July 31, 2018 2017 2016 (in thousands, except per share data) Net loss $ (33,646 ) $ (35,460 ) $ (27,438 ) Accretion of Series C and D redeemable convertible preferred stock (6,332 ) (9,570 ) (8,648 ) Net loss attributable to common stockholders $ (39,978 ) $ (45,030 ) $ (36,086 ) Weighted-average shares used in computing net loss per share attributable to common stockholders, basic and diluted 63,881 29,221 26,521 Net loss per share attributable to common stockholders, basic and diluted $ (0.63 ) $ (1.54 ) $ (1.36 ) |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The following table summarizes the outstanding potentially dilutive securities that were excluded from the computation of diluted net loss per share attributable to common stockholders because the impact of including them would have been antidilutive: July 31, 2018 2017 2016 (in thousands) Convertible preferred stock — 72,501 72,501 Outstanding stock options 16,175 15,058 9,376 Shares subject to repurchase from early exercised stock options 423 1,888 2,367 Purchase rights committed under the ESPP 2,044 — — Unvested RSUs 209 — — Total 18,851 89,447 84,244 |
Segment and Geographic Inform34
Segment and Geographic Information (Tables) | 12 Months Ended |
Jul. 31, 2018 | |
Risks and Uncertainties [Abstract] | |
Schedule of Long-Lived Assets | Our long-lived assets are composed of property and equipment, net, and are summarized by geographic area as follows: July 31, 2018 2017 (in thousands) United States $ 14,742 $ 9,372 Rest of the world 5,023 3,767 Total property and equipment, net $ 19,765 $ 13,139 |
Business and Summary of Signi35
Business and Summary of Significant Accounting Policies - Narrative (Details) | Apr. 01, 2018 | Mar. 31, 2018USD ($)$ / sharesshares | Mar. 31, 2018USD ($)$ / sharesshares | Jul. 31, 2018USD ($)shares | Oct. 31, 2017USD ($) | Jul. 31, 2018USD ($)segmentshares | Jul. 31, 2017USD ($)shares | Jul. 31, 2016USD ($) |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Reverse stock split, ratio | 0.6667 | |||||||
Sale of stock, number of shares issued in transaction (in shares) | shares | 13,800,000 | |||||||
Sale of stock, price per share (in dollars per share) | $ / shares | $ 16 | $ 16 | ||||||
Sale of stock, net proceeds | $ 205,300,000 | |||||||
Payments of stock issuance costs | $ 15,500,000 | $ 4,336,000 | $ 31,000 | $ 0 | ||||
Offering costs | $ 6,500,000 | 6,500,000 | $ 1,200,000 | |||||
Conversion of redeemable convertible preferred stock to common stock upon initial public offering (in shares) | shares | 72,500,750 | |||||||
Conversion ratio | 1 | 1 | 1 | |||||
Foreign currency loss | $ 100,000 | $ 100,000 | 300,000 | |||||
Number of reportable segments | segment | 1 | |||||||
Number of operating segments | segment | 1 | |||||||
Contract with customer, liability, revenue recognized | $ 85,300,000 | 58,500,000 | 40,700,000 | |||||
Revenue, remaining performance obligation | $ 397,900,000 | 397,900,000 | ||||||
Capitalized contract cost, amortization period | 5 years | |||||||
Accrued sales commission | $ 10,000,000 | 10,000,000 | 5,400,000 | |||||
Investment impairment | 0 | 0 | ||||||
Restricted cash | 600,000 | 600,000 | 600,000 | |||||
Capitalized software costs | 1,800,000 | 1,800,000 | 400,000 | 800,000 | ||||
Capitalized software, amortization expense | $ 900,000 | $ 900,000 | 1,200,000 | 1,000,000 | ||||
Leasehold improvements | 1,500,000 | |||||||
Requisite service period | 4 years | |||||||
Cumulative effect of new accounting principle | 0 | |||||||
Share-based compensation, excess tax benefit, amount | $ 900,000 | |||||||
Advertising expense | $ 3,400,000 | $ 1,800,000 | $ 1,800,000 | |||||
Preferred stock, shares issued (in shares) | shares | 0 | 0 | 0 | |||||
Redeemable convertible preferred stock, shares outstanding (in shares) | shares | 0 | 0 | 0 | |||||
Subscription and Support | Transferred over Time | Sales Revenue, Net | Product Concentration Risk | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Concentration risk percentage | 99.00% | 99.00% | 99.00% | |||||
Accumulated Deficit | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Cumulative effect of new accounting principle | $ 438,000 | |||||||
Minimum | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Contract with customer, term of contract | 1 year | |||||||
Contracts with customers, payment terms | 30 days | |||||||
Estimated Useful Life | 2 years | |||||||
Maximum | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Contract with customer, term of contract | 3 years | |||||||
Estimated Useful Life | 5 years | |||||||
ASU 2016-09 | Accumulated Deficit | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Cumulative effect of new accounting principle | $ 400,000 | |||||||
Capitalized internal-use software | ||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||
Estimated Useful Life | 3 years |
Business and Summary of Signi36
Business and Summary of Significant Accounting Policies - Schedule of Accounts Receivable (Details) - Accounts Receivable - Customer Concentration Risk | 12 Months Ended | |
Jul. 31, 2018 | Jul. 31, 2017 | |
Channel partner A | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 13.00% | |
Channel partner B | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 13.00% | |
Channel partner C | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 17.00% | |
Channel partner D | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 10.00% | |
Channel partner E | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 15.00% |
Business and Summary of Signi37
Business and Summary of Significant Accounting Policies - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jul. 31, 2018 | Jul. 31, 2017 | Jul. 31, 2016 | |
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 190,174 | $ 125,717 | $ 80,325 |
Channel partners | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 175,798 | 110,900 | 67,472 |
Direct customers | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 14,376 | $ 14,817 | $ 12,853 |
Geographic Concentration Risk | Sales Revenue, Net | |||
Disaggregation of Revenue [Line Items] | |||
Concentration risk percentage | 100.00% | 100.00% | 100.00% |
Customer Concentration Risk | Sales Revenue, Net | |||
Disaggregation of Revenue [Line Items] | |||
Concentration risk percentage | 100.00% | 100.00% | 100.00% |
Customer Concentration Risk | Sales Revenue, Net | Channel partners | |||
Disaggregation of Revenue [Line Items] | |||
Concentration risk percentage | 92.00% | 88.00% | 84.00% |
Customer Concentration Risk | Sales Revenue, Net | Direct customers | |||
Disaggregation of Revenue [Line Items] | |||
Concentration risk percentage | 8.00% | 12.00% | 16.00% |
United States | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 86,123 | $ 57,990 | $ 35,794 |
United States | Geographic Concentration Risk | Sales Revenue, Net | |||
Disaggregation of Revenue [Line Items] | |||
Concentration risk percentage | 45.00% | 46.00% | 44.00% |
Europe, Middle East and Africa | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 84,828 | $ 56,857 | $ 37,403 |
Europe, Middle East and Africa | Geographic Concentration Risk | Sales Revenue, Net | |||
Disaggregation of Revenue [Line Items] | |||
Concentration risk percentage | 45.00% | 45.00% | 47.00% |
Asia Pacific | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 14,465 | $ 9,853 | $ 5,779 |
Asia Pacific | Geographic Concentration Risk | Sales Revenue, Net | |||
Disaggregation of Revenue [Line Items] | |||
Concentration risk percentage | 8.00% | 8.00% | 7.00% |
Other | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 4,758 | $ 1,017 | $ 1,349 |
Other | Geographic Concentration Risk | Sales Revenue, Net | |||
Disaggregation of Revenue [Line Items] | |||
Concentration risk percentage | 2.00% | 1.00% | 2.00% |
United Kingdom | Geographic Concentration Risk | Sales Revenue, Net | |||
Disaggregation of Revenue [Line Items] | |||
Concentration risk percentage | 11.00% | 13.00% | 12.00% |
Business and Summary of Signi38
Business and Summary of Significant Accounting Policies - Summary of Deferred Contract Acquisition Costs (Details) - USD ($) $ in Thousands | 12 Months Ended | |||||
Jul. 31, 2018 | Jul. 31, 2017 | Jul. 31, 2016 | Jul. 31, 2018 | Jul. 31, 2017 | Jul. 31, 2016 | |
Changes in Capitalized Contract Cost [Roll Forward] | ||||||
Beginning balance | $ 34,662 | $ 21,137 | $ 13,150 | |||
Capitalization of contract acquisition costs | 34,429 | 21,999 | 13,502 | |||
Amortization of deferred contract acquisition costs | (13,181) | (8,474) | (5,515) | |||
Ending balance | 55,910 | 34,662 | 21,137 | |||
Deferred contract acquisition costs | $ 16,136 | $ 10,469 | $ 6,743 | |||
Deferred contract acquisition costs, noncurrent | 39,774 | 24,193 | 14,394 | |||
Total deferred contract acquisition costs | $ 34,662 | $ 21,137 | $ 13,150 | $ 55,910 | $ 34,662 | $ 21,137 |
Business and Summary of Signi39
Business and Summary of Significant Accounting Policies - Remaining Performance Obligation (Details) | 3 Months Ended |
Jul. 31, 2018 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2018-08-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, percentage | 53.00% |
Recognized transaction price period | 12 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-08-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, percentage | 96.00% |
Recognized transaction price period | 3 years |
Cash Equivalents and Short-Te40
Cash Equivalents and Short-Term Investments - Schedule of Cash Equivalents and Short-term Investments (Details) - USD ($) $ in Thousands | Jul. 31, 2018 | Jul. 31, 2017 |
Debt Securities, Available-for-sale [Line Items] | ||
Cash equivalents, amortized cost | $ 104,905 | |
Cash equivalents, unrealized gains | 0 | |
Cash equivalents, unrealized losses | (1) | |
Total cash equivalents | 104,904 | |
Short-term investments, amortized cost basis | 163,083 | |
Short-term investment, unrealized gains | 1 | |
Short-term investments, unrealized losses | (124) | |
Total short-term investments | 162,960 | $ 0 |
Cash equivalents and short-term investments, amortized cost | 267,988 | |
Cash equivalents and short-term investments, unrealized gains | 1 | |
Cash equivalents and short-term investments, unrealized losses | (125) | |
Cash equivalents and short-term investments, estimated fair value | 267,864 | |
Money market funds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Cash equivalents, amortized cost | 74,408 | 72,441 |
Cash equivalents, unrealized gains | 0 | 0 |
Cash equivalents, unrealized losses | 0 | 0 |
Total cash equivalents | 74,408 | $ 72,441 |
U.S. treasury securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Cash equivalents, amortized cost | 17,488 | |
Cash equivalents, unrealized gains | 0 | |
Cash equivalents, unrealized losses | 0 | |
Total cash equivalents | 17,488 | |
Short-term investments, amortized cost basis | 55,768 | |
Short-term investment, unrealized gains | 0 | |
Short-term investments, unrealized losses | (17) | |
Total short-term investments | 55,751 | |
U.S. government agency securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Cash equivalents, amortized cost | 1,999 | |
Cash equivalents, unrealized gains | 0 | |
Cash equivalents, unrealized losses | 0 | |
Total cash equivalents | 1,999 | |
Short-term investments, amortized cost basis | 17,953 | |
Short-term investment, unrealized gains | 0 | |
Short-term investments, unrealized losses | (19) | |
Total short-term investments | 17,934 | |
Corporate debt securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Cash equivalents, amortized cost | 11,010 | |
Cash equivalents, unrealized gains | 0 | |
Cash equivalents, unrealized losses | (1) | |
Total cash equivalents | 11,009 | |
Short-term investments, amortized cost basis | 89,362 | |
Short-term investment, unrealized gains | 1 | |
Short-term investments, unrealized losses | (88) | |
Total short-term investments | $ 89,275 |
Cash Equivalents and Short-Te41
Cash Equivalents and Short-Term Investments - Schedule of Maturities (Details) - USD ($) $ in Thousands | Jul. 31, 2018 | Jul. 31, 2017 |
Cash and Cash Equivalents [Abstract] | ||
Due within one year, cost basis | $ 116,897 | |
Due within one year, fair value | 116,843 | |
Due between one and two years, cost basis | 46,186 | |
Due between one and two years, fair value | 46,117 | |
Short-term investments, amortized cost basis | 163,083 | |
Total short-term investments, fair value | $ 162,960 | $ 0 |
Cash Equivalents and Short-Te42
Cash Equivalents and Short-Term Investments - Schedule of Unrealized Position (Details) $ in Thousands | Jul. 31, 2018USD ($) |
Debt Securities, Available-for-sale [Line Items] | |
Less than 12 months, fair value | $ 157,016 |
Less than 12 months, unrealized losses | (124) |
Greater than 12 months, fair value | 0 |
Greater than 12 months, unrealized losses | 0 |
Total fair value | 157,016 |
Total unrealized losses | (124) |
U.S. treasury securities | |
Debt Securities, Available-for-sale [Line Items] | |
Less than 12 months, fair value | 55,750 |
Less than 12 months, unrealized losses | (17) |
Greater than 12 months, fair value | 0 |
Greater than 12 months, unrealized losses | 0 |
Total fair value | 55,750 |
Total unrealized losses | (17) |
U.S. government agency securities | |
Debt Securities, Available-for-sale [Line Items] | |
Less than 12 months, fair value | 17,934 |
Less than 12 months, unrealized losses | (19) |
Greater than 12 months, fair value | 0 |
Greater than 12 months, unrealized losses | 0 |
Total fair value | 17,934 |
Total unrealized losses | (19) |
Corporate debt securities | |
Debt Securities, Available-for-sale [Line Items] | |
Less than 12 months, fair value | 83,332 |
Less than 12 months, unrealized losses | (88) |
Greater than 12 months, fair value | 0 |
Greater than 12 months, unrealized losses | 0 |
Total fair value | 83,332 |
Total unrealized losses | $ (88) |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Thousands | Jul. 31, 2018 | Jul. 31, 2017 |
Cash equivalents: | ||
Total cash equivalents | $ 104,904 | |
Short-term investments: | ||
Total short-term investments | 162,960 | $ 0 |
Fair Value, Measurements, Recurring | ||
Cash equivalents: | ||
Total cash equivalents | 104,904 | |
Short-term investments: | ||
Total short-term investments | 162,960 | |
Fair Value, Measurements, Recurring | Level I | ||
Cash equivalents: | ||
Total cash equivalents | 74,408 | |
Short-term investments: | ||
Total short-term investments | 0 | |
Fair Value, Measurements, Recurring | Level II | ||
Cash equivalents: | ||
Total cash equivalents | 30,496 | |
Short-term investments: | ||
Total short-term investments | 162,960 | |
Fair Value, Measurements, Recurring | Level III | ||
Cash equivalents: | ||
Total cash equivalents | 0 | |
Short-term investments: | ||
Total short-term investments | 0 | |
Money market funds | ||
Cash equivalents: | ||
Total cash equivalents | 74,408 | 72,441 |
Money market funds | Fair Value, Measurements, Recurring | ||
Cash equivalents: | ||
Total cash equivalents | 74,408 | 72,441 |
Money market funds | Fair Value, Measurements, Recurring | Level I | ||
Cash equivalents: | ||
Total cash equivalents | 74,408 | 72,441 |
Money market funds | Fair Value, Measurements, Recurring | Level II | ||
Cash equivalents: | ||
Total cash equivalents | 0 | 0 |
Money market funds | Fair Value, Measurements, Recurring | Level III | ||
Cash equivalents: | ||
Total cash equivalents | 0 | $ 0 |
U.S. treasury securities | ||
Cash equivalents: | ||
Total cash equivalents | 17,488 | |
Short-term investments: | ||
Total short-term investments | 55,751 | |
U.S. treasury securities | Fair Value, Measurements, Recurring | ||
Cash equivalents: | ||
Total cash equivalents | 17,488 | |
Short-term investments: | ||
Total short-term investments | 55,751 | |
U.S. treasury securities | Fair Value, Measurements, Recurring | Level I | ||
Cash equivalents: | ||
Total cash equivalents | 0 | |
Short-term investments: | ||
Total short-term investments | 0 | |
U.S. treasury securities | Fair Value, Measurements, Recurring | Level II | ||
Cash equivalents: | ||
Total cash equivalents | 17,488 | |
Short-term investments: | ||
Total short-term investments | 55,751 | |
U.S. treasury securities | Fair Value, Measurements, Recurring | Level III | ||
Cash equivalents: | ||
Total cash equivalents | 0 | |
Short-term investments: | ||
Total short-term investments | 0 | |
U.S. government agency securities | ||
Cash equivalents: | ||
Total cash equivalents | 1,999 | |
Short-term investments: | ||
Total short-term investments | 17,934 | |
U.S. government agency securities | Fair Value, Measurements, Recurring | ||
Cash equivalents: | ||
Total cash equivalents | 1,999 | |
Short-term investments: | ||
Total short-term investments | 17,934 | |
U.S. government agency securities | Fair Value, Measurements, Recurring | Level I | ||
Cash equivalents: | ||
Total cash equivalents | 0 | |
Short-term investments: | ||
Total short-term investments | 0 | |
U.S. government agency securities | Fair Value, Measurements, Recurring | Level II | ||
Cash equivalents: | ||
Total cash equivalents | 1,999 | |
Short-term investments: | ||
Total short-term investments | 17,934 | |
U.S. government agency securities | Fair Value, Measurements, Recurring | Level III | ||
Cash equivalents: | ||
Total cash equivalents | 0 | |
Short-term investments: | ||
Total short-term investments | 0 | |
Corporate debt securities | ||
Cash equivalents: | ||
Total cash equivalents | 11,009 | |
Short-term investments: | ||
Total short-term investments | 89,275 | |
Corporate debt securities | Fair Value, Measurements, Recurring | ||
Cash equivalents: | ||
Total cash equivalents | 11,009 | |
Short-term investments: | ||
Total short-term investments | 89,275 | |
Corporate debt securities | Fair Value, Measurements, Recurring | Level I | ||
Cash equivalents: | ||
Total cash equivalents | 0 | |
Short-term investments: | ||
Total short-term investments | 0 | |
Corporate debt securities | Fair Value, Measurements, Recurring | Level II | ||
Cash equivalents: | ||
Total cash equivalents | 11,009 | |
Short-term investments: | ||
Total short-term investments | 89,275 | |
Corporate debt securities | Fair Value, Measurements, Recurring | Level III | ||
Cash equivalents: | ||
Total cash equivalents | 0 | |
Short-term investments: | ||
Total short-term investments | $ 0 |
Property and Equipment - Schedu
Property and Equipment - Schedule of Property and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jul. 31, 2018 | Jul. 31, 2017 | |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 44,166 | $ 30,443 |
Less: Accumulated depreciation and amortization | (24,401) | (17,304) |
Total property and equipment, net | 19,765 | 13,139 |
Hosting equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 30,743 | 20,241 |
Computers and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 2,335 | 1,539 |
Purchased software | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 1,324 | 1,257 |
Estimated Useful Life | 3 years | |
Capitalized internal-use software | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 6,163 | 4,390 |
Estimated Useful Life | 3 years | |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 1,478 | 1,035 |
Estimated Useful Life | 5 years | |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 2,123 | $ 1,981 |
Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 2 years | |
Minimum | Hosting equipment | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 2 years | |
Minimum | Computers and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 3 years | |
Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 5 years | |
Maximum | Hosting equipment | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 3 years | |
Maximum | Computers and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 5 years |
Property and Equipment - Narrat
Property and Equipment - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jul. 31, 2018 | Jul. 31, 2017 | Jul. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation and amortization expense | $ 7,988 | $ 6,840 | $ 4,872 |
Commitments and Contingencies -
Commitments and Contingencies - Summary of Future Minimum Payments Under Operating Leases (Details) $ in Thousands | Jul. 31, 2018USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2,019 | $ 2,834 |
2,020 | 2,274 |
2,021 | 1,598 |
Total | $ 6,706 |
Commitments and Contingencies47
Commitments and Contingencies - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jul. 31, 2018 | Jul. 31, 2017 | Jul. 31, 2016 | |
Loss Contingencies [Line Items] | |||
Rent expense | $ 2.5 | $ 1.7 | $ 1.4 |
Bandwidth and colocation costs | 9.4 | 6.9 | $ 5.6 |
Purchase obligation | 3.1 | 2.2 | |
Finjan Litigation | |||
Loss Contingencies [Line Items] | |||
Accrued liability for potential lawsuit loss | 3.2 | ||
Accrued liability for potential lawsuit loss, current | $ 0.7 | $ 2.5 |
Commitments and Contingencies48
Commitments and Contingencies - Future Minimum Payments Due Under Data Center Contracts (Details) $ in Thousands | Jul. 31, 2018USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2,019 | $ 6,280 |
2,020 | 3,763 |
2,021 | 1,300 |
2,022 | 179 |
Total | $ 11,522 |
Convertible Preferred Stock (De
Convertible Preferred Stock (Details) $ / shares in Units, $ in Thousands | Apr. 01, 2018 | Mar. 31, 2018USD ($)$ / sharesshares | Mar. 31, 2018USD ($)$ / sharesshares | Sep. 30, 2015USD ($)$ / sharesshares | Jul. 31, 2018USD ($)$ / sharesshares | Jul. 31, 2017USD ($)$ / sharesshares | Jul. 31, 2016USD ($) | Jul. 31, 2015USD ($) |
Temporary Equity [Line Items] | ||||||||
Conversion of redeemable convertible preferred stock to common stock upon initial public offering (in shares) | shares | 72,500,750 | |||||||
Conversion ratio | 1 | 1 | 1 | |||||
Temporary equity, carrying value | $ | $ 207,300 | $ 207,300 | $ 0 | $ 200,977 | $ 191,407 | $ 157,802 | ||
Temporary equity, accretion value | $ | $ 24,700 | |||||||
Preferred stock, shares authorized (in shares) | shares | 200,000,000 | 200,000,000 | 200,000,000 | 73,100,000 | ||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | $ 0.001 | $ 0.001 | ||||
Redeemable convertible preferred stock, shares authorized (in shares) | shares | 0 | 73,100,000 | ||||||
Sale of stock, price per share (in dollars per share) | $ / shares | $ 16 | $ 16 | ||||||
Sale of stock, net proceeds | $ | $ 205,300 | |||||||
Accretion of Series C and D redeemable convertible preferred stock | $ | $ (6,332) | $ (9,570) | $ (8,648) | |||||
Series A Convertible Preferred Stock | ||||||||
Temporary Equity [Line Items] | ||||||||
Temporary equity, carrying value | $ | $ 5,000 | |||||||
Redeemable convertible preferred stock, shares authorized (in shares) | shares | 28,000,000 | |||||||
Preferred Stock, dividend rate (in dollars per share) | $ / shares | $ 0.0142875 | |||||||
Liquidation preference per share (in dollars per share) | $ / shares | $ 0.178575 | $ 0.18 | ||||||
Redeemable convertible preferred stock, shares outstanding (in shares) | shares | 1,333,333 | |||||||
Series B Convertible Preferred Stock | ||||||||
Temporary Equity [Line Items] | ||||||||
Temporary equity, carrying value | $ | $ 30,095 | |||||||
Redeemable convertible preferred stock, shares authorized (in shares) | shares | 25,000,000 | |||||||
Preferred Stock, dividend rate (in dollars per share) | $ / shares | $ 0.0972 | |||||||
Liquidation preference per share (in dollars per share) | $ / shares | $ 1.215 | $ 1.22 | ||||||
Redeemable convertible preferred stock, shares outstanding (in shares) | shares | 1,333,333 | |||||||
Series C Convertible Preferred Stock | ||||||||
Temporary Equity [Line Items] | ||||||||
Temporary equity, carrying value | $ | $ 37,897 | |||||||
Redeemable convertible preferred stock, shares authorized (in shares) | shares | 7,500,000 | |||||||
Preferred Stock, dividend rate (in dollars per share) | $ / shares | $ 0.412305 | |||||||
Liquidation preference per share (in dollars per share) | $ / shares | $ 5.14965 | $ 5.15 | ||||||
Redeemable convertible preferred stock, shares outstanding (in shares) | shares | 1,333,333 | |||||||
Redemption price per share (in dollars per share) | $ / shares | $ 5.14965 | |||||||
Series D Convertible Preferred Stock | ||||||||
Temporary Equity [Line Items] | ||||||||
Temporary equity, carrying value | $ | $ 127,985 | |||||||
Redeemable convertible preferred stock, shares authorized (in shares) | shares | 12,600,000 | |||||||
Preferred Stock, dividend rate (in dollars per share) | $ / shares | 0.71721 | |||||||
Liquidation preference per share (in dollars per share) | $ / shares | $ 8.9652 | $ 8.97 | ||||||
Liquidation preference, percentage | 8.00% | |||||||
Redeemable convertible preferred stock, shares outstanding (in shares) | shares | 1,333,333 | |||||||
Redemption price per share (in dollars per share) | $ / shares | $ 8.9652 | |||||||
Amended and Restated Certificate of Incorporation | ||||||||
Temporary Equity [Line Items] | ||||||||
Redeemable convertible preferred stock, shares authorized (in shares) | shares | 12,492,749 | |||||||
Preferred Stock Purchase Agreement | ||||||||
Temporary Equity [Line Items] | ||||||||
Redeemable convertible preferred stock, shares authorized (in shares) | shares | 2,788,560 | |||||||
Sale of stock, price per share (in dollars per share) | $ / shares | $ 8.9652 | |||||||
Sale of stock, net proceeds | $ | $ 25,000 |
Convertible Preferred Stock - S
Convertible Preferred Stock - Scheduled of Convertible Preferred Stock (Details) - USD ($) $ / shares in Units, $ in Thousands | Jul. 31, 2018 | Mar. 31, 2018 | Jul. 31, 2017 | Jul. 31, 2016 | Jul. 31, 2015 |
Temporary Equity [Line Items] | |||||
Shares authorized (in shares) | 0 | 73,100,000 | |||
Shares issued (in shares) | 0 | 72,501,000 | |||
Shares outstanding (in shares) | 0 | 72,501,000 | 72,501,000 | 69,712,000 | |
Redeemable convertible preferred stock; $0.001 par value; no shares and 73,100 shares authorized as of July 31, 2018 and 2017, respectively; no shares and 72,501 shares issued and outstanding as of July 31, 2018 and 2017, respectively; aggregate liquidation preference of $0 and $201,376 as of July 31, 2018 and 2017, respectively | $ 0 | $ 207,300 | $ 200,977 | $ 191,407 | $ 157,802 |
Liquidation preference | $ 0 | $ 201,376 | |||
Series A Convertible Preferred Stock | |||||
Temporary Equity [Line Items] | |||||
Shares authorized (in shares) | 28,000,000 | ||||
Shares issued (in shares) | 28,000,000 | ||||
Shares outstanding (in shares) | 28,000,000 | ||||
Redeemable convertible preferred stock; $0.001 par value; no shares and 73,100 shares authorized as of July 31, 2018 and 2017, respectively; no shares and 72,501 shares issued and outstanding as of July 31, 2018 and 2017, respectively; aggregate liquidation preference of $0 and $201,376 as of July 31, 2018 and 2017, respectively | $ 5,000 | ||||
Liquidation preference | $ 5,000 | ||||
Issue price per share (in dollars per share) | $ 0.178575 | $ 0.18 | |||
Series B Convertible Preferred Stock | |||||
Temporary Equity [Line Items] | |||||
Shares authorized (in shares) | 25,000,000 | ||||
Shares issued (in shares) | 24,856,000 | ||||
Shares outstanding (in shares) | 24,856,000 | ||||
Redeemable convertible preferred stock; $0.001 par value; no shares and 73,100 shares authorized as of July 31, 2018 and 2017, respectively; no shares and 72,501 shares issued and outstanding as of July 31, 2018 and 2017, respectively; aggregate liquidation preference of $0 and $201,376 as of July 31, 2018 and 2017, respectively | $ 30,095 | ||||
Liquidation preference | $ 30,200 | ||||
Issue price per share (in dollars per share) | 1.215 | $ 1.22 | |||
Series C Convertible Preferred Stock | |||||
Temporary Equity [Line Items] | |||||
Shares authorized (in shares) | 7,500,000 | ||||
Shares issued (in shares) | 7,375,000 | ||||
Shares outstanding (in shares) | 7,375,000 | ||||
Redeemable convertible preferred stock; $0.001 par value; no shares and 73,100 shares authorized as of July 31, 2018 and 2017, respectively; no shares and 72,501 shares issued and outstanding as of July 31, 2018 and 2017, respectively; aggregate liquidation preference of $0 and $201,376 as of July 31, 2018 and 2017, respectively | $ 37,897 | ||||
Liquidation preference | $ 37,980 | ||||
Issue price per share (in dollars per share) | 5.14965 | $ 5.15 | |||
Series D Convertible Preferred Stock | |||||
Temporary Equity [Line Items] | |||||
Shares authorized (in shares) | 12,600,000 | ||||
Shares issued (in shares) | 12,270,000 | ||||
Shares outstanding (in shares) | 12,270,000 | ||||
Redeemable convertible preferred stock; $0.001 par value; no shares and 73,100 shares authorized as of July 31, 2018 and 2017, respectively; no shares and 72,501 shares issued and outstanding as of July 31, 2018 and 2017, respectively; aggregate liquidation preference of $0 and $201,376 as of July 31, 2018 and 2017, respectively | $ 127,985 | ||||
Liquidation preference | $ 128,196 | ||||
Issue price per share (in dollars per share) | $ 8.9652 | $ 8.97 |
Common Stock (Details)
Common Stock (Details) $ / shares in Units, $ in Thousands | Mar. 31, 2018USD ($)vote$ / sharesshares | Mar. 31, 2018USD ($)vote$ / sharesshares | Jul. 31, 2018USD ($)$ / sharesshares | Jul. 31, 2017USD ($)$ / sharesshares | Jul. 31, 2016USD ($) |
Subsidiary, Sale of Stock [Line Items] | |||||
Sale of stock, number of shares issued in transaction (in shares) | shares | 13,800,000 | ||||
Sale of stock, price per share (in dollars per share) | $ / shares | $ 16 | $ 16 | |||
Sale of stock, net proceeds | $ 205,300 | ||||
Payments of stock issuance costs | $ 15,500 | $ 4,336 | $ 31 | $ 0 | |
Capitalized offering costs | $ 6,500 | $ 6,500 | $ 1,200 | ||
Common stock, shares issued (in shares) | shares | 1,000,000,000 | 1,000,000,000 | 1,000,000,000 | 130,000,000 | |
Common stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | $ 0.001 | $ 0.001 | |
Common stock, number of votes per share | vote | 1 | 1 | |||
IPO | |||||
Subsidiary, Sale of Stock [Line Items] | |||||
Sale of stock, number of shares issued in transaction (in shares) | shares | 13,800,000 | ||||
Sale of stock, price per share (in dollars per share) | $ / shares | $ 16 | $ 16 | |||
Capitalized offering costs | $ 6,500 |
Common Stock - Schedule of Comm
Common Stock - Schedule of Common Stock (Details) - shares | Jul. 31, 2018 | Jul. 31, 2017 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Equity awards outstanding: | 16,175,000 | 15,058,000 |
Equity awards available for future grants: | 32,055,000 | |
Employee Stock Option | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Equity awards outstanding: | 16,175,000 | |
RSUs | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Equity awards outstanding: | 209,000 | |
Equity Incentive Plans | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Equity awards available for future grants: | 13,471,000 | |
Employee Stock Purchase Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Equity awards outstanding: | 2,044,000 | |
Equity awards available for future grants: | 156,000 |
Stock Based Compensation - Narr
Stock Based Compensation - Narrative (Details) $ / shares in Units, $ in Thousands | Mar. 31, 2018shares | Mar. 31, 2018shares | Jul. 31, 2018USD ($)period$ / sharesshares | Jul. 31, 2017USD ($)$ / sharesshares | Jul. 31, 2016USD ($)$ / sharesshares | Jul. 31, 2015USD ($)shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Options exercised, aggregate intrinsic value | $ 16,688 | $ 4,500 | $ 3,000 | |||
Weighted average grant date fair value (in dollars per share) | $ / shares | $ 3.77 | $ 2.10 | $ 1.68 | |||
Issuance of common stock related to early exercised stock options | $ 0 | $ 0 | $ 0 | |||
Issuance of common stock, exercise of unvested stock options | $ 4,400 | $ 6,600 | ||||
Notes receivable, carrying value | 2,100 | 7,900 | ||||
Accrued interest | $ 100 | $ 400 | ||||
Repurchases of unvested shares (in shares) | shares | 787,000 | |||||
Repurchase price of stock | $ 4,000 | |||||
Repurchases of unvested shares (in dollars per share) | $ / shares | $ 5.11 | |||||
Stock repurchased, cash paid | $ 3,800 | |||||
Stock repurchased, decrease in notes receivable | 200 | |||||
Repayment of loans | $ 5,700 | |||||
Unvested RSUs | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting period | 4 years | |||||
Unrecognized compensation cost, stock options | $ 5,300 | |||||
Unrecognized compensation cost, weighted-average | 3 years 10 months 25 days | |||||
Outstanding stock options | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting period | 4 years | |||||
Unrecognized compensation cost, stock options | $ 27,000 | |||||
Unrecognized compensation cost, weighted-average | 2 years 10 months 25 days | |||||
Outstanding stock options | 2018 Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Expiration term | 10 years | |||||
Outstanding stock options | 2007 Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Expiration term | 7 years | |||||
Employee Stock | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Unrecognized compensation cost, stock options | $ 8,900 | |||||
Unrecognized compensation cost, weighted-average | 1 year 2 months 12 days | |||||
Employee Stock | 2018 Employee Stock Purchase Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Shares available for issuance (in shares) | shares | 2,200,000 | 2,200,000 | ||||
Percentage of outstanding common stock | 1.00% | |||||
Duration of offering period | 24 months | |||||
Number of purchases periods | period | 4 | |||||
Duration of purchase periods | 6 months | |||||
Employee subscription rate, maximum | 15.00% | |||||
Maximum number of shares per employee (in shares) | shares | 3,000 | |||||
Purchase price of common stock, percent | 85.00% | |||||
One year anniversary | Unvested RSUs | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting rights, percentage | 25.00% | |||||
One year anniversary | Outstanding stock options | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting rights, percentage | 25.00% | |||||
Minimum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Notes receivable, interest rate | 1.15% | |||||
Maximum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Notes receivable, interest rate | 2.85% | |||||
Common Stock | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Issuance of common stock related to early exercised stock options (in shares) | shares | 180,000 | 781,000 | 1,260,000 | |||
Issuance of common stock, exercise of unvested stock options (in shares) | shares | 1,076,666 | 2,733,333 | ||||
Repurchases of unvested shares (in shares) | shares | 787,479 | |||||
Common Stock | 2018 Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Shares available for issuance (in shares) | shares | 12,700,000 | 12,700,000 | ||||
Percentage of outstanding common stock | 5.00% | |||||
Common Stock | 2007 Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Issuance of common stock related to early exercised stock options (in shares) | shares | 179,861 | 781,320 | 1,260,000 | |||
Issuance of common stock related to early exercised stock options | $ 900 | $ 4,700 | $ 5,200 | |||
Common stock subject to repurchase (in shares) | shares | 422,528 | 1,887,638 | ||||
Shares subject to repurchase, value | $ 1,600 | $ 8,000 |
Stock Based Compensation - Sche
Stock Based Compensation - Schedule of Stock Options (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Jul. 31, 2018 | Jul. 31, 2017 | Jul. 31, 2016 | |
Shares Available For Grant | |||
Beginning balance (in shares) | 739,000 | ||
Stock options granted (in shares) | (5,021,000) | ||
Repurchases of unvested shares (in shares) | 787,000 | ||
Stock options canceled, forfeited, expired (in shares) | (2,012,000) | ||
Ending balance (in shares) | 13,471,000 | 739,000 | |
Outstanding Stock Options | |||
Balance (in shares) | 15,058,000 | ||
Stock options granted (in shares) | (5,021,000) | ||
Stock options exercised (in shares) | (1,892,000) | ||
Stock options canceled, forfeited, expired (in shares) | (2,012,000) | ||
Balance (in shares) | 16,175,000 | 15,058,000 | |
Exercisable and expected to vest as of July 31, 2017 (in shares) | 5,907,000 | ||
Exercisable and expected to vest as of July 31, 2018 (in shares) | 5,499,000 | 5,907,000 | |
Weighted-Average Exercise Price | |||
Beginning balance (in dollars per share) | $ 4.50 | ||
Stock options granted (in dollars per share) | 10.02 | ||
Stock options exercised (in dollars per share) | 3.09 | ||
Repurchases of unvested shares (in dollars per share) | 5.11 | ||
Stock options canceled, forfeited, expired (in dollars per share) | 5.90 | ||
Ending balance (in dollars per share) | 6.20 | $ 4.50 | |
Exercisable and expected to vest as of July 31, 2017 (in dollars per share) | 3.67 | ||
Exercisable and expected to vest as of July 31, 2018 (in dollars per share) | $ 3.97 | $ 3.67 | |
Additional Disclosures | |||
Options outstanding, weighted average remaining contractual term | 5 years 1 month 6 days | 5 years 7 months 6 days | |
Exercisable, weighted average remaining contractual term | 4 years | 4 years 10 months 25 days | |
Options outstanding, aggregate intrinsic value | $ 470,860 | $ 56,717 | |
Options exercised, aggregate intrinsic value | 16,688 | 4,500 | $ 3,000 |
Exercisable and expected to vest, aggregate intrinsic value | $ 172,317 | $ 27,135 | |
2007 Plan | |||
Shares Available For Grant | |||
Increase in authorized shares (in shares) | 3,333,000 | ||
Shares terminated under 2007 plan (in shares) | (870,000) | ||
2018 Plan | |||
Shares Available For Grant | |||
Increase in authorized shares (in shares) | 12,700,000 | ||
RSUs | |||
Shares Available For Grant | |||
RSU activity, net (in shares) | (209,000) | ||
Outstanding Stock Options | |||
Balance (in shares) | 209,000 |
Stock Based Compensation - Valu
Stock Based Compensation - Valuation Assumptions (Details) | 12 Months Ended | ||
Jul. 31, 2018 | Jul. 31, 2017 | Jul. 31, 2016 | |
2018 Employee Stock Purchase Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected stock price volatility, minimum | 30.70% | ||
Expected stock price volatility, maximum | 53.20% | ||
Risk-free interest rate, minimum | 2.00% | ||
Risk-free interest rate, maximum | 2.60% | ||
Dividend rate | 0.00% | ||
Minimum | 2018 Employee Stock Purchase Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected term (in years) | 6 months | ||
Maximum | 2018 Employee Stock Purchase Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected term (in years) | 2 years 3 months 19 days | ||
Outstanding stock options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected term (in years) | 4 years 7 months 6 days | 4 years 7 months 6 days | |
Expected stock price volatility, minimum | 40.30% | 41.40% | 43.60% |
Expected stock price volatility, maximum | 42.30% | 43.30% | 45.20% |
Risk-free interest rate, minimum | 1.70% | 1.10% | 1.10% |
Risk-free interest rate, maximum | 2.80% | 2.00% | 1.60% |
Dividend rate | 0.00% | 0.00% | 0.00% |
Outstanding stock options | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected term (in years) | 4 years 7 months 6 days | ||
Outstanding stock options | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected term (in years) | 5 years 1 month 6 days |
Stock Based Compensation - RSU
Stock Based Compensation - RSU Activity (Details) - RSUs $ / shares in Units, $ in Thousands | 12 Months Ended |
Jul. 31, 2018USD ($)$ / sharesshares | |
Number of Shares | |
Balance (in shares) | shares | 0 |
Stock options granted (in shares) | shares | 210,000 |
Released (in shares) | shares | 0 |
Stock options canceled, forfeited, expired (in shares) | shares | (1,000) |
Balance (in shares) | shares | 209,000 |
Weighted-Average Grant Date Fair Value per Share | |
Balance as of July 31, 2017 (in shares) | $ / shares | $ 0 |
Granted (in dollars per share) | $ / shares | 26.26 |
Released (in shares) | $ / shares | 0 |
Canceled, forfeited (in shares) | $ / shares | 26.26 |
Balance as of July 31, 2018 (in shares) | $ / shares | $ 26.26 |
Additional Disclosures [Abstract] | |
Aggregate Intrinsic Value | $ | $ 0 |
Aggregate Intrinsic Value, vested | $ | 0 |
Aggregate Intrinsic Value | $ | $ 7,394 |
Stock Based Compensation - Stoc
Stock Based Compensation - Stock-based Compensation Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jul. 31, 2018 | Jul. 31, 2017 | Jul. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total stock-based compensation expense | $ 11,224 | $ 9,919 | $ 3,617 |
Cost of revenue | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total stock-based compensation expense | 757 | 348 | 189 |
Sales and marketing | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total stock-based compensation expense | 5,044 | 2,794 | 1,574 |
Research and development | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total stock-based compensation expense | 3,045 | 5,574 | 1,025 |
General and administrative | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total stock-based compensation expense | $ 2,378 | $ 1,203 | $ 829 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 12 Months Ended | ||
Jul. 31, 2018 | Jul. 31, 2017 | Jul. 31, 2016 | |
Operating Loss Carryforwards [Line Items] | |||
Remeasurement of deferred tax assets | $ 19,700,000 | ||
Change in valuation allowance | 19,700,000 | ||
One-time repatriation tax | 1,000,000 | ||
Adjustments to additional paid in capital | 900,000 | ||
Change during the period | (5,915,000) | $ 11,194,000 | $ 8,800,000 |
Unrecognized tax benefits | 2,622,000 | 0 | |
Federal Jurisdiction | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforward | 173,600,000 | 150,000,000 | |
State Jurisdiction | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforward | 62,400,000 | $ 68,300,000 | |
Research Tax Credit Carryforward | Federal Jurisdiction | |||
Operating Loss Carryforwards [Line Items] | |||
Tax credit carryforward | 4,500,000 | ||
Research Tax Credit Carryforward | State Jurisdiction | |||
Operating Loss Carryforwards [Line Items] | |||
Tax credit carryforward | $ 4,200,000 |
Income Taxes - Schedule of Inco
Income Taxes - Schedule of Income before Income Tax (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jul. 31, 2018 | Jul. 31, 2017 | Jul. 31, 2016 | |
Income Tax Disclosure [Abstract] | |||
Domestic | $ (36,455) | $ (36,874) | $ (28,227) |
International | 4,146 | 2,291 | 1,257 |
Loss before income taxes | $ (32,309) | $ (34,583) | $ (26,970) |
Income Taxes - Schedule of Comp
Income Taxes - Schedule of Components of Provision of Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jul. 31, 2018 | Jul. 31, 2017 | Jul. 31, 2016 | |
Current: | |||
Federal | $ 0 | $ 0 | $ 0 |
State | (2) | 31 | 16 |
Foreign | 1,480 | 874 | 452 |
Total current tax expense | 1,478 | 905 | 468 |
Deferred: | |||
Federal | 0 | 0 | 0 |
State | 0 | 0 | 0 |
Foreign | (141) | (28) | 0 |
Total deferred tax expense | (141) | (28) | 0 |
Income Tax Expense (Benefit) | $ 1,337 | $ 877 | $ 468 |
Income Taxes - Schedule of Reco
Income Taxes - Schedule of Reconciliation of Effective Income Tax Rate (Details) | 12 Months Ended | ||
Jul. 31, 2018 | Jul. 31, 2017 | Jul. 31, 2016 | |
Income Tax Disclosure [Abstract] | |||
Tax at federal statutory rate | 21.00% | 34.00% | 34.00% |
State taxes | 0.00% | 1.50% | 1.80% |
Impact of foreign rate differential | 0.30% | (1.70%) | 0.10% |
Meals and entertainment | (1.30%) | (0.50%) | (0.50%) |
Stock-based compensation | (3.80%) | (2.80%) | (4.10%) |
Impact of U.S. tax reform | (58.60%) | 0.00% | 0.00% |
Provision to return adjustments | 2.80% | (0.30%) | 0.00% |
U.S. tax credits | 3.70% | (0.00%) | (0.00%) |
Change in valuation allowance | 33.50% | (32.40%) | (32.50%) |
Other | (1.70%) | (0.30%) | (0.50%) |
Effective tax rate | (4.10%) | (2.50%) | (1.70%) |
Income Taxes - Schedule of Co62
Income Taxes - Schedule of Components of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Jul. 31, 2018 | Jul. 31, 2017 | Jul. 31, 2016 | Jul. 31, 2015 |
Deferred tax assets: | ||||
Net operating losses carryovers | $ 41,794 | $ 54,130 | ||
Accruals and reserves | 2,863 | 2,807 | ||
Deferred revenue | 6,071 | 5,436 | ||
Tax credits carryovers | 6,118 | 0 | ||
Stock-based compensation | 784 | 571 | ||
Property and equipment | 303 | 339 | ||
Other | 347 | 569 | ||
Gross deferred tax assets | 58,280 | 63,852 | ||
Less: Valuation allowance | (45,578) | (51,493) | $ (40,299) | $ (31,483) |
Total deferred tax assets | 12,702 | 12,359 | ||
Deferred tax liabilities: | ||||
Deferred contract acquisition costs | (12,561) | (12,331) | ||
Total deferred tax liabilities | (12,561) | (12,331) | ||
Net deferred tax assets | $ 141 | $ 28 |
Income Taxes - Schedule of Valu
Income Taxes - Schedule of Valuation Allowance (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jul. 31, 2018 | Jul. 31, 2017 | Jul. 31, 2016 | |
Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Beginning balance | $ 51,493 | $ 40,299 | $ 31,483 |
Change during the period | (5,915) | 11,194 | 8,800 |
Ending balance | $ 45,578 | $ 51,493 | $ 40,299 |
Income Taxes - Schedule of Unre
Income Taxes - Schedule of Unrecognized Tax Benefits (Details) | 12 Months Ended |
Jul. 31, 2018USD ($) | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |
Balance as of July 31, 2017 | $ 0 |
Gross increase for tax positions of prior fiscal years | 1,746,000 |
Gross increase for tax positions of current fiscal year | 876,000 |
Balance as of July 31, 2018 | $ 2,622,000 |
Net Loss Per Share Attributab65
Net Loss Per Share Attributable to Common Stockholders - Narrative (Details) | Apr. 01, 2018 | Mar. 31, 2018 | Jul. 31, 2017 |
Earnings Per Share [Abstract] | |||
Conversion ratio | 1 | 1 | 1 |
Net Loss Per Share (Details)
Net Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Jul. 31, 2018 | Jul. 31, 2017 | Jul. 31, 2016 | |
Earnings Per Share [Abstract] | |||
Net loss | $ (33,646) | $ (35,460) | $ (27,438) |
Accretion of Series C and D redeemable convertible preferred stock | (6,332) | (9,570) | (8,648) |
Net loss attributable to common stockholders | $ (39,978) | $ (45,030) | $ (36,086) |
Weighted-average shares used in computing net loss per share attributable to common stockholders, basic and diluted (in shares) | 63,881,000 | 29,221,000 | 26,521,000 |
Net loss per share attributable to common stockholders, basic and diluted (in dollars per share) | $ (0.63) | $ (1.54) | $ (1.36) |
Net Loss Per Share Attributab67
Net Loss Per Share Attributable to Common Stockholders - Antidilutive Securities Excluded from Computation (Details) - shares | 12 Months Ended | ||
Jul. 31, 2018 | Jul. 31, 2017 | Jul. 31, 2016 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities (in shares) | 18,851 | 89,447 | 84,244 |
Convertible preferred stock | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities (in shares) | 0 | 72,501 | 72,501 |
Outstanding stock options | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities (in shares) | 16,175 | 15,058 | 9,376 |
Shares subject to repurchase from early exercised stock options | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities (in shares) | 423 | 1,888 | 2,367 |
Purchase rights committed under the ESPP | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities (in shares) | 2,044 | 0 | 0 |
Unvested RSUs | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities (in shares) | 209 | 0 | 0 |
Segment and Geographic Inform68
Segment and Geographic Information (Details) | 12 Months Ended |
Jul. 31, 2018segment | |
Risks and Uncertainties [Abstract] | |
Number of operating segments | 1 |
Segment and Geographic Inform69
Segment and Geographic Information - Schedule of Long-lived Assets (Details) - USD ($) $ in Thousands | Jul. 31, 2018 | Jul. 31, 2017 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property and equipment, net | $ 19,765 | $ 13,139 |
United States | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property and equipment, net | 14,742 | 9,372 |
Rest of the world | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property and equipment, net | $ 5,023 | $ 3,767 |
Related Party Transactions (Det
Related Party Transactions (Details) $ in Millions | 1 Months Ended |
Nov. 30, 2016USD ($) | |
Related Party Transactions [Abstract] | |
Stock-based compensation expense | $ 4.4 |