Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jan. 31, 2019 | Feb. 28, 2019 | |
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-Q | |
Document Period End Date | Jan. 31, 2019 | |
Document Fiscal Year Focus | 2,019 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Shares Outstanding | 124,147,097 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Jan. 31, 2019 | Jul. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 67,467 | $ 135,579 |
Short-term investments | 272,476 | 162,960 |
Accounts receivable, net | 75,470 | 61,611 |
Deferred contract acquisition costs | 18,058 | 16,136 |
Prepaid expenses and other current assets | 12,540 | 10,878 |
Total current assets | 446,011 | 387,164 |
Property and equipment, net | 25,762 | 19,765 |
Deferred contract acquisition costs, noncurrent | 42,543 | 39,774 |
Other noncurrent assets | 3,797 | 1,078 |
Total assets | 518,113 | 447,781 |
Current liabilities: | ||
Accounts payable | 3,459 | 4,895 |
Accrued expenses and other current liabilities | 13,934 | 12,313 |
Accrued compensation | 15,541 | 23,393 |
Liability for early exercise of unvested stock options | 972 | 1,561 |
Deferred revenue | 176,326 | 140,670 |
Total current liabilities | 210,232 | 182,832 |
Deferred revenue, noncurrent | 29,694 | 23,353 |
Other noncurrent liabilities | 1,114 | 1,360 |
Total liabilities | 241,040 | 207,545 |
Commitments and contingencies (Note 6) | ||
Stockholders’ Equity | ||
Preferred stock; $0.001 par value; 200,000 shares authorized as of January 31, 2019 and July 31, 2018; no shares issued and outstanding as of January 31, 2019 and July 31, 2018 | 0 | 0 |
Common stock; $0.001 par value; 1,000,000 shares authorized as of January 31, 2019 and July 31, 2018; 123,897 and 119,764 shares issued and outstanding as of January 31, 2019 and July 31, 2018, respectively | 124 | 119 |
Additional paid-in capital | 483,951 | 438,392 |
Notes receivable from stockholders | 0 | (2,051) |
Accumulated other comprehensive loss | (59) | (124) |
Accumulated deficit | (206,943) | (196,100) |
Total stockholders’ equity | 277,073 | 240,236 |
Total liabilities and stockholders’ equity | $ 518,113 | $ 447,781 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Jan. 31, 2019 | Jul. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 200,000,000 | 200,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued (in shares) | 123,987,000 | 119,764,000 |
Common stock, shares outstanding (in shares) | 123,987,000 | 119,764,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jan. 31, 2019 | Jan. 31, 2018 | Jan. 31, 2019 | Jan. 31, 2018 | |
Income Statement [Abstract] | ||||
Revenue | $ 74,302 | $ 44,976 | $ 137,600 | $ 84,837 |
Cost of revenue | 15,271 | 8,679 | 27,370 | 16,950 |
Gross profit | 59,031 | 36,297 | 110,230 | 67,887 |
Operating expenses: | ||||
Sales and marketing | 38,756 | 27,110 | 75,301 | 54,038 |
Research and development | 15,071 | 9,183 | 28,257 | 17,992 |
General and administrative | 10,386 | 6,403 | 20,517 | 13,533 |
Total operating expenses | 64,213 | 42,696 | 124,075 | 85,563 |
Loss from operations | (5,182) | (6,399) | (13,845) | (17,676) |
Interest income, net | 1,924 | 213 | 3,514 | 408 |
Other income, net | 250 | 28 | 62 | 1 |
Loss before income taxes | (3,008) | (6,158) | (10,269) | (17,267) |
Provision for income taxes | 547 | 357 | 874 | 646 |
Net loss | (3,555) | (6,515) | (11,143) | (17,913) |
Accretion of Series C and D redeemable convertible preferred stock | 0 | (2,579) | 0 | (5,109) |
Net loss attributable to common stockholders | $ (3,555) | $ (9,094) | $ (11,143) | $ (23,022) |
Net loss per share attributable to common stockholders, basic and diluted (in dollars per share) | $ (0.03) | $ (0.29) | $ (0.09) | $ (0.74) |
Weighted-average shares used in computing net loss per share attributable to common stockholders, basic and diluted (in shares) | 122,741 | 31,434 | 121,664 | 31,125 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jan. 31, 2019 | Jan. 31, 2018 | Jan. 31, 2019 | Jan. 31, 2018 | |
Statement of Comprehensive Income [Abstract] | ||||
Net loss | $ (3,555) | $ (6,515) | $ (11,143) | $ (17,913) |
Other comprehensive income, net of tax: | ||||
Unrealized net gains on available-for-sale securities | 258 | 0 | 65 | 0 |
Other comprehensive income | 258 | 0 | 65 | 0 |
Comprehensive loss | $ (3,297) | $ (6,515) | $ (11,078) | $ (17,913) |
Condensed Consolidated Statem_3
Condensed 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 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Cumulative effect of accounting change | $ 0 | $ 438 | $ (438) | |||
Redeemable convertible preferred stock, beginning balance (in shares) at Jul. 31, 2017 | 72,501,000 | |||||
Redeemable convertible preferred stock, beginning balance at Jul. 31, 2017 | $ 200,977 | |||||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||
Accretion of Series C and D redeemable convertible preferred stock | $ 5,109 | |||||
Redeemable convertible preferred stock, ending balance (in shares) at Jan. 31, 2018 | 72,501,000 | |||||
Redeemable convertible preferred stock, ending balance at Jan. 31, 2018 | $ 206,086 | |||||
Common stock, beginning balance (in shares) at Jul. 31, 2017 | 32,359,000 | |||||
Beginning balance at Jul. 31, 2017 | (151,142) | $ 18 | 18,734 | $ (7,878) | $ 0 | (162,016) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of common stock upon exercise of stock options (in shares) | 841,000 | |||||
Issuance of common stock upon exercise of stock options | 2,171 | $ 1 | 2,170 | |||
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 | |||||
Vesting of early exercised stock options | 1,015 | 1,015 | ||||
Stock-based compensation | 3,797 | 3,797 | ||||
Net loss | (17,913) | (17,913) | ||||
Accretion of Series C and D redeemable convertible preferred stock | (5,109) | (5,109) | ||||
Repurchases of unvested common stock (in shares) | (549,000) | |||||
Repurchases of unvested common stock | 214 | 214 | ||||
Accrued interest on notes receivable from stockholders, net of repayments | (91) | (91) | ||||
Common stock, ending balance (in shares) at Jan. 31, 2018 | 32,831,000 | |||||
Ending balance at Jan. 31, 2018 | $ (167,058) | $ 19 | 21,045 | (7,755) | 0 | (180,367) |
Redeemable convertible preferred stock, beginning balance (in shares) at Oct. 31, 2017 | 72,501,000 | |||||
Redeemable convertible preferred stock, beginning balance at Oct. 31, 2017 | $ 203,507 | |||||
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||||
Accretion of Series C and D redeemable convertible preferred stock | $ 2,579 | |||||
Redeemable convertible preferred stock, ending balance (in shares) at Jan. 31, 2018 | 72,501,000 | |||||
Redeemable convertible preferred stock, ending balance at Jan. 31, 2018 | $ 206,086 | |||||
Common stock, beginning balance (in shares) at Oct. 31, 2017 | 32,233,000 | |||||
Beginning balance at Oct. 31, 2017 | (161,410) | $ 19 | 20,133 | (7,710) | 0 | (173,852) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of common stock upon exercise of stock options (in shares) | 418,000 | |||||
Issuance of common stock upon exercise of stock options | 960 | 960 | ||||
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 | |||||
Vesting of early exercised stock options | 467 | 467 | ||||
Stock-based compensation | 2,064 | 2,064 | ||||
Net loss | (6,515) | (6,515) | ||||
Accretion of Series C and D redeemable convertible preferred stock | (2,579) | (2,579) | ||||
Accrued interest on notes receivable from stockholders, net of repayments | (45) | (45) | ||||
Common stock, ending balance (in shares) at Jan. 31, 2018 | 32,831,000 | |||||
Ending balance at Jan. 31, 2018 | $ (167,058) | $ 19 | 21,045 | (7,755) | 0 | (180,367) |
Redeemable convertible preferred stock, beginning balance (in shares) at Jul. 31, 2018 | 0 | |||||
Redeemable convertible preferred stock, beginning balance at Jul. 31, 2018 | $ 0 | |||||
Redeemable convertible preferred stock, ending balance (in shares) at Jan. 31, 2019 | 0 | |||||
Redeemable convertible preferred stock, ending balance at Jan. 31, 2019 | $ 0 | |||||
Common stock, beginning balance (in shares) at Jul. 31, 2018 | 119,764,000 | 119,764,000 | ||||
Beginning balance at Jul. 31, 2018 | $ 240,236 | $ 119 | 438,392 | (2,051) | (124) | (196,100) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of common stock upon exercise of stock options (in shares) | 3,511,000 | 3,511,000 | ||||
Issuance of common stock upon exercise of stock options | $ 15,493 | $ 4 | 15,489 | |||
Issuance of common stock related to early exercised stock options (in shares) | 627,000 | |||||
Issuance of common stock related to early exercised stock options | 8,691 | $ 1 | 8,690 | |||
Vesting of restricted stock units (in shares) | 3,000 | |||||
Vesting of restricted stock units | 0 | |||||
Adjustment to initial public offering costs | 300 | 300 | ||||
Vesting of early exercised stock options | 567 | 567 | ||||
Stock-based compensation | 20,813 | 20,813 | ||||
Other comprehensive income | 65 | 65 | ||||
Net loss | (11,143) | (11,143) | ||||
Repurchases of unvested common stock (in shares) | (8,000) | |||||
Repurchases of unvested common stock | 0 | |||||
Repayments of principal amount on notes receivable from stockholders | 1,905 | 1,905 | ||||
Accrued interest on notes receivable from stockholders, net of repayments | $ 146 | 146 | ||||
Common stock, ending balance (in shares) at Jan. 31, 2019 | 123,987,000 | 123,897,000 | ||||
Ending balance at Jan. 31, 2019 | $ 277,073 | $ 124 | 483,951 | 0 | (59) | (206,943) |
Redeemable convertible preferred stock, beginning balance (in shares) at Oct. 31, 2018 | 0 | |||||
Redeemable convertible preferred stock, beginning balance at Oct. 31, 2018 | $ 0 | |||||
Redeemable convertible preferred stock, ending balance (in shares) at Jan. 31, 2019 | 0 | |||||
Redeemable convertible preferred stock, ending balance at Jan. 31, 2019 | $ 0 | |||||
Common stock, beginning balance (in shares) at Oct. 31, 2018 | 122,106,000 | |||||
Beginning balance at Oct. 31, 2018 | 252,178 | $ 122 | 455,761 | 0 | (317) | (203,388) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of common stock upon exercise of stock options (in shares) | 1,161,000 | |||||
Issuance of common stock upon exercise of stock options | 5,697 | $ 1 | 5,696 | |||
Issuance of common stock related to early exercised stock options (in shares) | 627,000 | |||||
Issuance of common stock related to early exercised stock options | 8,691 | $ 1 | 8,690 | |||
Vesting of restricted stock units (in shares) | 3,000 | |||||
Vesting of restricted stock units | 0 | |||||
Adjustment to initial public offering costs | 300 | 300 | ||||
Vesting of early exercised stock options | 277 | 277 | ||||
Stock-based compensation | 13,227 | 13,227 | ||||
Other comprehensive income | 258 | 258 | ||||
Net loss | $ (3,555) | (3,555) | ||||
Common stock, ending balance (in shares) at Jan. 31, 2019 | 123,987,000 | 123,897,000 | ||||
Ending balance at Jan. 31, 2019 | $ 277,073 | $ 124 | $ 483,951 | $ 0 | $ (59) | $ (206,943) |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | |
Jan. 31, 2019 | Jan. 31, 2018 | |
Cash Flows From Operating Activities | ||
Net loss | $ (11,143) | $ (17,913) |
Adjustments to reconcile net loss to cash provided by operating activities: | ||
Depreciation and amortization expense | 4,662 | 3,910 |
Amortization of acquired intangible assets | 239 | 0 |
Amortization of deferred contract acquisition costs | 8,781 | 5,932 |
Stock-based compensation expense | 20,813 | 3,797 |
Accretion of purchase discounts, net of amortization of investment premiums | (1,125) | 0 |
Other | 202 | (92) |
Changes in operating assets and liabilities: | ||
Accounts receivable | (13,859) | (8,482) |
Deferred contract acquisition costs | (13,472) | (11,213) |
Prepaid expenses and other assets | (2,778) | (1,094) |
Accounts payable | (786) | (2,211) |
Accrued expenses and other liabilities | 1,042 | 445 |
Accrued compensation | (7,852) | (1,185) |
Deferred revenue | 41,997 | 22,638 |
Net cash provided by (used in) operating activities | 26,721 | (5,468) |
Cash Flows From Investing Activities | ||
Purchases of property, equipment and other | (8,607) | (7,045) |
Capitalized internal-use software | (903) | (950) |
Acquired intangible assets | (1,480) | 0 |
Purchases of short-term investments | (179,896) | 0 |
Proceeds from maturities of short-term investments | 71,603 | 0 |
Net cash used in investing activities | (119,283) | (7,995) |
Cash Flows From Financing Activities | ||
Payments of offering costs related to initial public offering | (1,797) | (2,896) |
Proceeds from issuance of common stock upon exercise of stock options | 15,493 | 2,171 |
Proceeds from issuance of common stock related to early exercised stock options | 0 | 869 |
Proceeds from issuance of common stock under the employee stock purchase plan | 8,691 | 0 |
Repurchases of unvested common stock | (22) | (3,090) |
Repayments of notes receivable from stockholders | 1,905 | 0 |
Net cash provided by (used in) financing activities | 24,270 | (2,946) |
Net decrease in cash, cash equivalents and restricted cash | (68,292) | (16,409) |
Cash, cash equivalents and restricted cash at beginning of period | 136,147 | 88,546 |
Cash, cash equivalents and restricted cash at end of period | 67,855 | 72,137 |
Supplemental Disclosure of Cash Flow Information: | ||
Cash paid for income taxes | 1,121 | 267 |
Supplemental Disclosure of Noncash Investing and Financing Activities: | ||
Net change in purchased equipment included in accounts payable and accrued expenses | 1,544 | (363) |
Accretion of Series C and D redeemable convertible preferred stock | 0 | 5,109 |
Repurchases of unvested common stock by cancellation of indebtedness | 0 | 214 |
Vesting of early exercised common stock options | 567 | 1,015 |
Net change in deferred offering costs accrued | (2,097) | 203 |
Reconciliation of cash, cash equivalents and restricted cash within the condensed consolidated balance sheets to the amounts shown in the statements of cash flows above: | ||
Total cash, cash equivalents and restricted cash | $ 136,147 | $ 88,546 |
Business and Summary of Signifi
Business and Summary of Significant Accounting Policies | 6 Months Ended |
Jan. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Business and Summary of Significant Accounting Policies | Business and Summary of Significant Accounting Policies Description of the 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 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. All issued and outstanding share and per share amounts included in the accompanying condensed 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 $6.2 million which were recorded in stockholders’ equity 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. Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States ("U.S. GAAP") and applicable regulations of the Securities and Exchange Commission ("SEC") regarding interim financial reporting, and include the accounts of the Company and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Certain information and note disclosures normally included in the financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to the applicable required disclosures and regulations of the SEC. Therefore, these unaudited condensed consolidated financial statements and accompanying footnotes should be read in conjunction with the Company's audited consolidated financial statements and related notes in its Annual Report on Form 10-K for the fiscal year ended July 31, 2018 (the "Fiscal 2018 Form 10-K"), as filed with the SEC on September 13, 2018. Interim Unaudited Condensed Consolidated Financial Statements The accompanying condensed balance sheet as of July 31, 2018 was derived from the audited financial statements as of that date. The accompanying interim condensed consolidated financial statements, including the consolidated balance sheets as of January 31, 2019, the consolidated statements of operations for the three and six months ended January 31, 2019 and 2018, the consolidated statements of comprehensive loss for the three and six months ended January 31, 2019 and 2018, the consolidated statements of cash flows for the six months ended January 31, 2019 and 2018, the consolidated statement of redeemable convertible preferred stock and stockholders’ equity (deficit) for the three and six months ended January 31, 2019 and 2018 are unaudited. The related financial data and the other financial information disclosed in the accompanying notes to these condensed consolidated financial statements are also unaudited. These interim unaudited condensed consolidated financial statements have been prepared on a basis consistent with our annual consolidated financial statements and, in our opinion, include all normal recurring adjustments necessary to state fairly our quarterly results. The results of operations for the three and six months ended January 31, 2019 are not necessarily indicative of the results to be expected for the fiscal year ending July 31, 2019 or for any other future fiscal year or interim period. JOBS Act Extended Transition Period We are an emerging growth company ("EGC") as defined in the Jumpstart Our Business Startups Act of 2012 (the "JOBS Act"). As an EGC, the JOBS Act allows us to take advantage of specified reduced reporting requirements that are otherwise generally applicable 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. 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 are subject to the same new or revised accounting standards as other public companies that are not emerging growth companies. As a result of our transition to large accelerated filer status as of July 31, 2019, we will cease to qualify as an emerging growth company and will no longer have the option to take advantage of the extended transition period. Use of Estimates The preparation of condensed 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, valuation of acquired intangible assets, 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, useful lives of acquired intangible assets, loss contingencies related to litigation and valuation of deferred tax assets. Management determines these estimates and assumptions based 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 condensed consolidated financial statements. Fiscal Year Our fiscal year ends on July 31. References to fiscal 2019, for example, refer to our fiscal year ending July 31, 2019. Significant Accounting Policies Our significant accounting policies are discussed in the "Index to Consolidated Financial Statements, Note 1. Business and Summary of Significant Accounting Policies" in the Fiscal 2018 Form 10-K. There have been no significant changes to these policies that have had a material impact on our condensed consolidated financial statements and related notes for the three and six months ended January 31, 2019. The following describes the impact of certain policies. Revenue Recognition We adopted Accounting Standards Codification ("ASC") Topic 606, Revenue From Contracts With Customers ("ASC 606") on August 1, 2017, using the full retrospective transition method. Disaggregation of Revenue Subscription and support revenue is recognized over time and accounted for approximately 97% and 99% of our revenue for the three months ended January 31, 2019 and 2018, respectively, and approximately 98% of our revenue for the six months ended January 31, 2019 and 2018. The following table summarizes the revenue by region based on the shipping address of customers who have contracted to use our cloud platform: Three Months Ended January 31, Six Months Ended January 31, 2019 2018 2019 2018 Amount % Revenue Amount % Revenue Amount % Revenue Amount % Revenue (in thousands, except per percentage data) United States $ 37,626 51 % $ 20,224 45 % $ 67,433 49 % $ 39,985 47 % Europe, Middle East and Africa (*) 29,552 40 % 20,168 45 % 56,946 41 % 37,154 44 % Asia Pacific 5,674 7 % 3,465 8 % 10,463 8 % 6,554 8 % Other 1,450 2 % 1,119 2 % 2,758 2 % 1,144 1 % Total $ 74,302 100 % $ 44,976 100 % $ 137,600 100 % $ 84,837 100 % (*) Revenue from the United Kingdom ("U.K.") represented 10% and 12% of our revenue for the three months ended January 31, 2019 and 2018, respectively, and 10% and 11% for the six months ended January 31, 2019 and 2018, respectively. The following table summarizes the revenue from contracts by type of customer: Three Months Ended January 31, Six Months Ended January 31, 2019 2018 2019 2018 Amount % Revenue Amount % Revenue Amount % Revenue Amount % Revenue (in thousands, except per percentage data) Channel partners $ 71,074 96 % $ 41,258 92 % $ 131,093 95 % $ 77,429 91 % Direct customers 3,228 4 % 3,718 8 % 6,507 5 % 7,408 9 % Total $ 74,302 100 % $ 44,976 100 % $ 137,600 100 % $ 84,837 100 % 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. For the six months ended January 31, 2019 and 2018, we recognized revenue of $68.2 million and $58.6 million, respectively, that was included in the corresponding contract liability balance at the beginning of these periods. 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 January 31, 2019, the aggregate amount of the transaction price allocated to remaining performance obligations was $461.0 million. We expect to recognize 55% of the transaction price over the next 12 months and 98% of the transaction price over the next three years, with the remainder recognized thereafter. Costs to Obtain and Fulfill a Contract We capitalize sales commissions 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 condensed consolidated balance sheets. The following table summarizes the activity of the deferred contract acquisition costs: Three Months Ended January 31, Six Months Ended January 31, 2019 2018 2019 2018 (in thousands) Beginning balance $ 55,978 $ 36,002 $ 55,910 $ 34,662 Capitalization of contract acquisition costs 9,080 7,005 13,472 11,213 Amortization of deferred contract acquisition costs (4,457) (3,064) (8,781) (5,932) Ending balance $ 60,601 $ 39,943 $ 60,601 $ 39,943 As of the end of the period: Deferred contract acquisition costs, current $ 18,058 $ 12,271 $ 18,058 $ 12,271 Deferred contract acquisition costs, noncurrent 42,543 27,672 42,543 27,672 Total deferred contract acquisition costs $ 60,601 $ 39,943 $ 60,601 $ 39,943 Sales commissions accrued but not paid as of January 31, 2019 and July 31, 2018, totaled $4.6 million and $10.0 million, respectively, which are included within accrued compensation in the condensed consolidated balance sheets. Deferred Offering Costs Deferred offering costs consisted of fees and expenses incurred in connection with our IPO, including legal, accounting, printing and other IPO-related costs. Total deferred offering costs of $6.2 million were reclassified to stockholders' equity (deficit) as a reduction of the net proceeds received from the IPO. Recently Adopted Accounting Pronouncements In January 2017, the Financial Accounting Standard Board ("FASB") issued Accounting Standard Update ("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. This standard provides a screen test 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. We adopted this standard as of August 1, 2018, and it did not have a material impact to our consolidated financial statements. 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. We adopted this standard as of August 1, 2018, and it did not 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 eliminates the diversity in practice related to the classification of certain cash receipts and payments for debt prepayment or extinguishment costs, the maturing of a zero-coupon bond, the settlement of contingent liabilities arising from a business combination, proceeds from insurance settlements, distributions from certain equity method investees and beneficial interests obtained in a financial asset securitization. We adopted this standard as of August 1, 2018 using the retrospective transition method, and it did not 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 requires that amounts generally described as restricted cash or restricted cash equivalents be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. We adopted this standard as of August 1, 2018 using the retrospective transition method and we have adjusted our prior period condensed consolidated statement of cash flows to conform to the current presentation. 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 early adopted this standard as of August 1, 2018 using the prospective transition method, which resulted in a cumulative-effect adjustment of $0.3 million recognized within stockholders' equity, as a reduction of additional paid-in capital against accumulated deficit, on the adoption date. In August 2018, the FASB issued ASU No. 2018-15, “Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract ,” which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. The new standard requires capitalized costs to be amortized on a straight-line basis generally over the term of the arrangement, and the financial statement presentation for these capitalized costs would be the same as that of the fees related to the hosting arrangements. For public business entities, this standard is effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. Early adoption is permitted. We early adopted this standard as of August 1, 2018 using the prospective transition method, and it did not have a material impact to our consolidated financial statements. In August 2018, the SEC adopted the final rule under SEC Release No. 33-10532, " Disclosure Update and Simplification ," amending certain disclosure requirements that have become redundant, duplicative, overlapping, outdated or superseded. In addition, the amendments expanded the disclosure requirements on the analysis of stockholders' equity for interim financial statements. Under the amendments, an analysis of changes in each caption of stockholders' equity presented in the balance sheet must be provided in a note or separate statement. The analysis should present a reconciliation of the beginning balance to the ending balance of each period for which a statement of comprehensive income is required to be filed. The final rule is effective November 5, 2018. We early adopted this requirement as of August 1, 2018, presenting the activity of the stockholder's equity accounts in the accompanying condensed statements of redeemable convertible preferred stock and stockholders' equity (deficit) for the periods presented. Recently Issued Accounting Pronouncements Not Yet Adopted In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) ("ASU 2016-02"), which requires lessees to recognize most leases on their balance sheets that do not meet the definition of a short-term lease but recognize the expenses on their statements of operations in a manner similar to current accounting rules. In July 2018, the FASB issued ASU 2018-10, Leases (Topic 842), Codification Improvements ("ASU 2018-10"), which clarifies certain adoption provisions of the new leases standard such as the application of implicit rate, lessee reassessment of lease classification and certain transition adjustments. In addition, in July 2018, the FASB issued ASU 2018-11, Leases (Topic 842), Targeted Improvements ("ASU 2018-11"), which allows for the adoption of ASU 2016-02 to be applied at the beginning of the year of adoption, as opposed to at the beginning of the earliest year presented in the financial statements. These standards are effective for fiscal years beginning after December 15, 2018, with early adoption permitted. We are currently evaluating the effect of these standards; however, we anticipate the most significant effects will relate to the recognition of right-of-use assets and lease liabilities arising from our real estate and data center operating leases that do not meet the definition of a short-term lease on the adoption date and providing qualitative and quantitative disclosures in the notes to the condensed 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. |
Cash Equivalents and Short-Term
Cash Equivalents and Short-Term Investments | 6 Months Ended |
Jan. 31, 2019 | |
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 January 31, 2019: Amortized Unrealized Unrealized (in thousands) Cash equivalents: Money market funds $ 49,405 $ — $ — $ 49,405 U.S. treasury securities 4,993 — (1) 4,992 Total cash equivalents $ 54,398 $ — $ (1) $ 54,397 Short-term investments: U.S. treasury securities $ 130,212 $ 13 $ (15) $ 130,210 U.S. government agency securities 44,399 3 (44) 44,358 Corporate debt securities 97,923 50 (65) 97,908 Total short-term investments $ 272,534 $ 66 $ (124) $ 272,476 Total cash equivalents and short-term investments $ 326,932 $ 66 $ (125) $ 326,873 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 The amortized cost and fair value of our short-term investments based on their stated maturities consisted of the following as of January 31, 2019: Amortized Fair Value (in thousands) Due within one year $ 213,194 $ 213,163 Due between one and two years 59,340 59,313 Total short-term investments $ 272,534 $ 272,476 Short-term investments that were in an unrealized loss position consisted of the following as of January 31, 2019: Less than 12 Months Greater than 12 Months Total Fair Unrealized Fair Unrealized Fair Unrealized (in thousands) U.S. treasury securities $ 83,321 $ (15) $ — $ — $ 83,321 $ (15) U.S. government agency securities 35,588 (44) — — 35,588 (44) Corporate debt securities 72,855 (65) — — 72,855 (65) Total investments in a loss position $ 191,764 $ (124) $ — $ — $ 191,764 $ (124) 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 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 January 31, 2019 and July 31, 2018. |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jan. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements 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. Our money market funds are classified within Level I due to the highly liquid nature of these assets which also 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 debt 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 January 31, 2019: 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 $ 49,405 $ 49,405 $ — $ — U.S. treasury securities 4,992 — 4,992 — Total cash equivalents $ 54,397 $ 49,405 $ 4,992 $ — Short-term investments: U.S. treasury securities $ 130,210 $ — $ 130,210 $ — U.S. government agency securities 44,358 — 44,358 — Corporate debt securities 97,908 — 97,908 — Total short-term investments $ 272,476 $ — $ 272,476 $ — 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 $ — 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 | 6 Months Ended |
Jan. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and Equipment Property and equipment consisted of the following: January 31, 2019 July 31, 2018 (in thousands) Hosting equipment $ 39,960 $ 30,743 Computers and equipment 2,573 2,335 Purchased software 1,314 1,324 Capitalized internal-use software 7,066 6,163 Furniture and fixtures 1,514 1,478 Leasehold improvements 2,123 2,123 Property and equipment, gross 54,550 44,166 Less: Accumulated depreciation and amortization (28,788) (24,401) Total property and equipment, net $ 25,762 $ 19,765 Depreciation and amortization expense on property and equipment was $2.5 million and $2.0 million for the three months ended January 31, 2019 and 2018, respectively, and $4.7 million and $3.9 million for the six months ended January 31, 2019 and 2018, respectively. |
Acquired Intangible Assets, Net
Acquired Intangible Assets, Net | 6 Months Ended |
Jan. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Acquired Intangible Assets, Net | Acquired Intangible Assets, Net Acquired intangible assets consist of developed technology and are included within other noncurrent assets in the condensed consolidated balance sheets. As of January 31, 2019, acquired intangible assets have a weighted-average remaining useful life of 2.6 years and are amortized on a straight-line basis. Amortization expense of acquired intangible assets was $0.1 million for the three months ended January 31, 2019 and $0.2 million for the six months ended January 31, 2019. We did not have acquired intangible assets prior to fiscal 2019. The gross carrying amount and accumulated amortization of acquired intangible assets consisted of the following as of January 31, 2019: Gross Carrying Amount Accumulated Amortization Net Book Value (in thousands) Developed technology $ 1,716 $ (239) $ 1,477 Future amortization expense of acquired intangible assets consisted of the following as of January 31, 2019: Amortization Year ending July 31, (in thousands) 2019 (remaining six months) $ 286 2020 572 2021 572 2022 47 Total $ 1,477 |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jan. 31, 2019 | |
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 August 2021. Future minimum payments under our non-cancelable operating leases consisted of the following as of January 31, 2019: Operating (in thousands) Year ending July 31, 2019 (remaining six months) $ 1,578 2020 2,588 2021 1,604 2022 18 Total $ 5,788 Rent expense was $0.8 million and $0.6 million for the three months ended January 31, 2019 and 2018, respectively, and $1.4 million and $1.1 million for the six months ended January 31, 2019 and 2018, respectively. 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. Future minimum payments under our non-cancelable data center contracts consisted of the following as of January 31, 2019: Data Center Contracts (in thousands) Year ending July 31, 2019 (remaining six months) $ 4,416 2020 6,710 2021 4,131 2022 933 Total $ 16,190 Bandwidth and colocation expenses are recognized as cost of revenue and were $3.4 million and $2.2 million for the three months ended January 31, 2019 and 2018, respectively, and $6.4 million and $4.3 million for the six months ended January 31, 2019 and 2018, respectively. 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 equipment, subscription-based cloud service arrangements, corporate events and consulting services. As of January 31, 2019 and July 31, 2018, we had outstanding non-cancelable purchase obligations with a term of 12 months or longer of $3.7 million and $3.1 million, respectively. |
Legal Matters | 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 ("’658 patent"), 7,360,249 ("’249 patent"), 7,587,488, 8,316,429 ("’429 patent"), 8,316,446 ("’446 patent"), 8,402,540 and 9,525,696 ("’696 patent"). 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. On December 12, 2018, Symantec filed a notice of voluntary dismissal with prejudice of the ’658, ’249, and ’696 Patents asserted 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 January 31, 2019 related to past negotiations with Finjan of which we recognized $0.7 million in fiscal 2018 and $2.5 million in fiscal 2017. We are vigorously defending this lawsuit. 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. |
Preferred Stock
Preferred Stock | 6 Months Ended |
Jan. 31, 2019 | |
Temporary Equity Disclosure [Abstract] | |
Preferred Stock | Preferred Stock Upon completion of our IPO, as further described in Note 1, 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 and their carrying value, totaling $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). Prior to the IPO, we recognized accretion to the redemption price of Series C and D redeemable convertible preferred stock. Accretion was recognized as a reduction of additional paid-in capital with a corresponding increase to the carrying value of Series C and D redeemable convertible preferred stock. Upon completion of the IPO, the accretion rights of Series C |
Common Stock
Common Stock | 6 Months Ended |
Jan. 31, 2019 | |
Equity [Abstract] | |
Common Stock | Common Stock Holders of our common stock are entitled to one vote for each share of common stock held and are not entitled to receive dividends unless declared by our board of directors. Shares of common stock reserved for future issuance consisted of the following as of January 31, 2019: Underlying Shares (in thousands) Equity awards outstanding: Stock options 12,028 Unvested restricted stock units 3,037 Unvested performance stock units, based on the target number of shares granted (*) 1,460 Purchase rights committed under the employee stock purchase plan 1,410 Equity awards available for future grants: Equity incentive plans 15,815 Employee stock purchase plan 1,361 Total reserved shares of common stock for future issuance 35,111 (*) Holders of performance stock units corresponding to fiscal 2019, as further described in Note 9, have the ability to receive up to 150% of the target number of shares granted if the maximum achievement of target performance metrics is attained. |
Stock Based Compensation
Stock Based Compensation | 6 Months Ended |
Jan. 31, 2019 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation Equity Incentive Plans We adopted the Fiscal Year 2018 Equity Incentive Plan (the "2018 Plan") in fiscal 2018 and the 2007 Stock Plan (the "2007 Plan") in fiscal 2008, collectively referred to as the "Plans." Equity incentive awards granted under the Plans may be either restricted stock units, restricted stock, stock options, nonstatutory stock options, stock appreciation rights, performance units and performance shares to our employees, directors, officers and consultants. 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. As of January 31, 2019, we have reserved a total of approximately 18,688,000 shares of common stock for the issuance of equity awards under the 2018 Plan, of which approximately 15,815,000 shares were available for grant on such date. Stock Options Under the Plans, the exercise price of a stock option grant must not be 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. The activity of stock options consisted of the following: Outstanding Weighted-Average Weighted-Average Aggregate (in thousands, except per share amounts) Balance as of July 31, 2018 16,175 $ 6.20 5.1 $ 470,860 Stock options exercised (3,511) $ 4.41 $ 129,596 Stock options canceled, forfeited or expired (636) $ 6.22 Balance as of January 31, 2019 12,028 $ 6.72 4.9 $ 500,853 Exercisable and expected to vest as of July 31, 2018 5,499 $ 3.97 4.0 $ 172,317 Exercisable and expected to vest as of January 31, 2019 4,055 $ 4.52 4.0 $ 177,830 The aggregate intrinsic value of the stock options exercised represents the difference between the fair value of our common stock on the date of exercise and their exercise price. The total intrinsic value of options exercised for the six months ended January 31, 2019 and 2018 was $129.6 million and $5.2 million, respectively. The weighted-average grant-date fair value per share of stock options granted for the six months ended January 31, 2018 was $3.12. Since our IPO, we have not granted additional stock options. We estimated the fair value of employee stock option using the Black-Scholes option pricing model with the following assumptions. Six Months Ended January 31, 2018 Expected term (in years) 4.6 Expected stock price volatility 40.4% - 41.5% Risk-free interest rate 1.7% - 2.6% Dividend yield 0.0% Restricted Stock Units The 2018 Plan allows for the grant of restricted stock units ("RSUs"). 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. We began granting RSUs in the fourth quarter of fiscal 2018. The activity of RSUs consisted of the following: RSUs Outstanding Weighted-Average Grant Date Fair Value per Share Aggregate (in thousands, except per share amounts) Balance as of July 31, 2018 209 $ 26.26 $ 7,394 Granted 2,888 $ 40.20 Vested (3) $ 44.26 $ 111 Canceled, forfeited (57) $ 40.36 Balance as of January 31, 2019 3,037 $ 39.23 $ 146,897 Performance Stock Units The 2018 Plan allows for the grant of performance stock units ("PSUs"). During the six months ended January 31, 2019, the compensation committee of our board of directors approved the grant of PSUs to certain members of our executive team corresponding to the performance periods of fiscal 2019, 2020, 2021 and 2022. In addition, the compensation committee determined and approved the corporate performance metrics for fiscal 2019. The corporate performance metrics corresponding to future fiscal years will be determined and approved in the future for each corresponding fiscal year. Holders of PSUs corresponding to the performance period of fiscal 2019 have the ability to receive up to 150% of the target number of shares granted if maximum achievement of target performance metrics is achieved. The right to receive such awards is subject to achievement of the defined corporate performance metrics corresponding for each fiscal year and continuous service by the employee. Any earned awards are subject to additional time-based vesting in accordance with the respective award agreement. Since the performance conditions of future fiscal years have not been established as of January 31, 2019, these awards are not considered granted for accounting purposes. Therefore, we have not recognized stock-based compensation expense for PSUs corresponding to fiscal years beyond 2019. The number of unvested PSUs outstanding based on the target number of shares granted consisted of the following as of January 31, 2019: Underlying Shares Performance periods (in thousands) Fiscal 2019 464 Fiscal 2020 464 Fiscal 2021 150 Fiscal 2022 150 Total 1,228 The activity of PSUs for which performance conditions have been established and are expected to be earned consisted of the following: Underlying Shares Weighted-Average Grant Date Fair Value per Share Aggregate (in thousands, except for share amounts) Balance as of July 31, 2018 — — $ — Granted 464 $ 36.90 Vested — — $ — Canceled, forfeited — — Balance as of January 31, 2019 464 $ 36.90 $ 22,456 Employee Stock Purchase Plan We adopted the Fiscal Year 2018 Employee Stock Purchase Plan (the "ESPP") in the third quarter of fiscal 2018. As of January 31, 2019, a total of 3,397,643 shares of common stock were reserved for issuance 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. 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. 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 ESPP employee payroll contributions accrued at January 31, 2019 and July 31, 2018, totaled $2.2 million and $4.6 million, respectively, and are included within accrued compensation in the condensed consolidated balance sheets. Employee payroll contributions ultimately used to purchase shares under the ESPP will be reclassified to stockholders' equity on the purchase date. The fair value of the purchase right for the ESPP is estimated on the date of grant using the Black-Scholes model with the following assumptions: Six Months Ended January 31, 2019 Expected term (in years) 0.5 - 2.0 Expected stock price volatility 44.0% - 61.9% Risk-free interest rate 2.5% - 2.7% Dividend yield 0.0% Early Exercise of Employee Options The 2007 Plan allowed for the early exercise of stock options for certain individuals as determined by the board of directors. The consideration received for an early exercise of an option is considered to be a deposit of the exercise price and is reflected as liability in the condensed consolidated balance sheets 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. During the six months ended January 31, 2019 and 2018, we reclassified to additional paid-in capital $0.6 million and $1.0 million, respectively, related to awards vested during these periods. As of January 31, 2019 and July 31, 2018, the number of shares of common stock subject to repurchase was 238,662 shares and 422,528 shares with an aggregate purchase price of $1.0 million and $1.6 million, respectively. Notes Receivable from Stockholders Prior to fiscal 2017, 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. The outstanding principal amount and related accrued interest on the notes are presented as contra-equity in the condensed consolidated balance sheets until the notes are fully settled. As of July 31, 2018, the carrying amount of the outstanding notes receivable, inclusive of accrued interest of $0.1 million, was $2.1 million. During the six months ended January 31, 2019, the principal amount and accrued interest of the outstanding notes were fully repaid, resulting in cash proceeds of $2.1 million. Stock-based Compensation Expense The components of stock-based compensation expense recognized in the condensed consolidated statements of operations consisted of the following: Three Months Ended January 31, Six Months Ended January 31, 2019 2018 2019 2018 (in thousands) Cost of revenue $ 619 $ 126 1,122 $ 235 Sales and marketing 5,517 985 8,318 1,770 Research and development 4,398 494 7,193 892 General and administrative 2,693 459 4,180 900 Total stock-based compensation expense $ 13,227 $ 2,064 $ 20,813 $ 3,797 As of January 31, 2019, the unrecognized stock-based compensation cost was $148.5 million, which we expect to amortize over a weighted-average period of 3.5 years. |
Income Taxes
Income Taxes | 6 Months Ended |
Jan. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Our tax provision for interim periods is determined using an estimate of our annual effective tax rate, adjusted for discrete items, if any, that arise during the period. Each quarter, we update our estimate of the annual effective tax rate, and if the estimated annual effective tax rate changes, we make a cumulative adjustment in such period. Our quarterly tax provision, and estimate of our annual effective tax rate, is subject to variation due to several factors, including variability in pre-tax income (or loss), the mix of jurisdictions to which such income relates, changes in how we do business, and tax law developments. Our estimated annual effective tax rate for the year differs from the U.S. statutory rate of 21% primarily due to the earnings of our foreign subsidiaries being taxed at rates higher than the U.S. statutory rate. We recorded a provision for income taxes of $0.5 million and $0.4 million for the three months ended January 31, 2019 and 2018, respectively, and $0.9 million and $0.6 million for the six months ended January 31, 2019 and 2018, respectively. We are subject to income tax in the U.S. as well as other tax jurisdictions in which we conduct business. Earnings from our non-U.S. operations are subject to income taxes in the countries in which we operate. Our provision for income taxes consists primarily of both income and withholding taxes in the foreign jurisdictions in which we conduct business. The realization of deferred tax assets is dependent upon the generation of sufficient taxable income of the appropriate character in future periods. We assess our ability to realize the deferred tax assets on a quarterly basis and we 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 in certain jurisdictions, we believe that it is more likely than not that our U.S. federal and state deferred tax assets will not be realized. Accordingly, we have maintained a valuation allowance on our U.S. federal and state deferred tax assets. During the three months ended October 31, 2018, we determined that due to the weight of objectively verifiable negative evidence, our U.K. deferred tax assets are no longer more likely than not to be realized in the future and a full valuation allowance was recorded. We have maintained the valuation allowance for the period ended January 31, 2019. 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% imposing a one-time mandatory transition 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. In December 2017, the SEC staff issued Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act (“SAB 118”), which allows us to record provisional amounts during a measurement period not to extend beyond one year past the enactment date. |
Net Loss Per Share Attributable
Net Loss Per Share Attributable to Common Stockholders | 6 Months Ended |
Jan. 31, 2019 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share Attributable to Common Stockholders | Net Loss Per Share Attributable to Common Stockholders The following table sets forth the computation of basic and diluted net loss per share attributable to common stockholders: Three Months Ended Six months ended 2019 2018 2019 2018 (in thousands) Net loss $ (3,555) $ (6,515) $ (11,143) $ (17,913) Accretion of Series C and D redeemable convertible preferred stock — (2,579) — (5,109) Net loss attributable to common stockholders $ (3,555) $ (9,094) $ (11,143) $ (23,022) Weighted-average shares used in computing net loss per share attributable to common stockholders, basic and diluted 122,741 31,434 121,664 31,125 Net loss per share attributable to common stockholders, basic and diluted $ (0.03) $ (0.29) $ (0.09) $ (0.74) 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 summarizes the unweighted outstanding potentially dilutive securities that were excluded from the computation of the diluted net loss per share attributable to common stockholders because the impact of including them would have been antidilutive: January 31, 2019 2018 (in thousands) Convertible preferred stock — 72,501 Outstanding stock options 12,028 14,949 Shares subject to repurchase from early exercised stock options 239 1,171 Purchase rights committed under the ESPP 1,410 — Unvested RSUs 3,037 — Unvested PSUs (*) 464 — Total 17,178 88,621 (*) The number of unvested PSUs is based on the target number of shares granted and excludes unvested PSUs for which performance conditions have not been established as of January 31, 2019, as they are not considered outstanding for accounting purposes. Refer to Note 9 for further information. |
Significant Customers and Geogr
Significant Customers and Geographic Information | 6 Months Ended |
Jan. 31, 2019 | |
Risks and Uncertainties [Abstract] | |
Significant Customers and Geographic Information | Significant Customers and Geographic Information No single customer accounted for 10% or more of our revenue for the three and six months ended January 31, 2019 and 2018. Refer to Note 1 to our condensed consolidated financial statements for revenue by geography information. The following table summarizes 10% or more of the total balance of accounts receivable, net: January 31, 2019 July 31, 2018 Channel partner A 13% * Channel partner B * 13% Channel partner C * 13% (*) Represents less than 10%. Our long-lived assets consist of property, equipment and intangible assets, which are summarized by geographic area as follows: January 31, 2019 July 31, 2018 (in thousands) United States $ 20,336 $ 14,742 Rest of the world 7,559 5,023 Total long-lived assets $ 27,895 $ 19,765 |
Related Party Transactions
Related Party Transactions | 6 Months Ended |
Jan. 31, 2019 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions We previously entered into notes receivable agreements with certain of our current and former executives and employees in connection with the exercise of their stock options. Outstanding notes receivable were fully repaid during the six months ended January 31, 2019. Refer to Note 9 to our condensed consolidated financial statements for further information. |
Business and Summary of Signi_2
Business and Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jan. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States ("U.S. GAAP") and applicable regulations of the Securities and Exchange Commission ("SEC") regarding interim financial reporting, and include the accounts of the Company and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Certain information and note disclosures normally included in the financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to the applicable required disclosures and regulations of the SEC. Therefore, these unaudited condensed consolidated financial statements and accompanying footnotes should be read in conjunction with the Company's audited consolidated financial statements and related notes in its Annual Report on Form 10-K for the fiscal year ended July 31, 2018 (the "Fiscal 2018 Form 10-K"), as filed with the SEC on September 13, 2018. |
Use of Estimates | Use of Estimates The preparation of condensed 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, valuation of acquired intangible assets, 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, useful lives of acquired intangible assets, loss contingencies related to litigation and valuation of deferred tax assets. Management determines these estimates and assumptions based 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 condensed consolidated financial statements. |
Revenue Recognition | Revenue Recognition We adopted Accounting Standards Codification ("ASC") Topic 606, Revenue From Contracts With Customers ("ASC 606") on August 1, 2017, using the full retrospective transition method. Disaggregation of Revenue Subscription and support revenue is recognized over time and accounted for approximately 97% and 99% of our revenue for the three months ended January 31, 2019 and 2018, respectively, and approximately 98% of our revenue for the six months ended January 31, 2019 and 2018. The following table summarizes the revenue by region based on the shipping address of customers who have contracted to use our cloud platform: Three Months Ended January 31, Six Months Ended January 31, 2019 2018 2019 2018 Amount % Revenue Amount % Revenue Amount % Revenue Amount % Revenue (in thousands, except per percentage data) United States $ 37,626 51 % $ 20,224 45 % $ 67,433 49 % $ 39,985 47 % Europe, Middle East and Africa (*) 29,552 40 % 20,168 45 % 56,946 41 % 37,154 44 % Asia Pacific 5,674 7 % 3,465 8 % 10,463 8 % 6,554 8 % Other 1,450 2 % 1,119 2 % 2,758 2 % 1,144 1 % Total $ 74,302 100 % $ 44,976 100 % $ 137,600 100 % $ 84,837 100 % (*) Revenue from the United Kingdom ("U.K.") represented 10% and 12% of our revenue for the three months ended January 31, 2019 and 2018, respectively, and 10% and 11% for the six months ended January 31, 2019 and 2018, respectively. The following table summarizes the revenue from contracts by type of customer: Three Months Ended January 31, Six Months Ended January 31, 2019 2018 2019 2018 Amount % Revenue Amount % Revenue Amount % Revenue Amount % Revenue (in thousands, except per percentage data) Channel partners $ 71,074 96 % $ 41,258 92 % $ 131,093 95 % $ 77,429 91 % Direct customers 3,228 4 % 3,718 8 % 6,507 5 % 7,408 9 % Total $ 74,302 100 % $ 44,976 100 % $ 137,600 100 % $ 84,837 100 % 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. For the six months ended January 31, 2019 and 2018, we recognized revenue of $68.2 million and $58.6 million, respectively, that was included in the corresponding contract liability balance at the beginning of these periods. 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 January 31, 2019, the aggregate amount of the transaction price allocated to remaining performance obligations was $461.0 million. We expect to recognize 55% of the transaction price over the next 12 months and 98% of the transaction price over the next three years, with the remainder recognized thereafter. Costs to Obtain and Fulfill a Contract We capitalize sales commissions 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 condensed consolidated balance sheets. |
Deferred Offering Costs | Deferred Offering CostsDeferred offering costs consisted of fees and expenses incurred in connection with our IPO, including legal, accounting, printing and other IPO-related costs. |
Recently Adopted Accounting Pronouncements; Recently Issued Accounting Pronouncements Not Yet Adopted | Recently Adopted Accounting Pronouncements In January 2017, the Financial Accounting Standard Board ("FASB") issued Accounting Standard Update ("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. This standard provides a screen test 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. We adopted this standard as of August 1, 2018, and it did not have a material impact to our consolidated financial statements. 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. We adopted this standard as of August 1, 2018, and it did not 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 eliminates the diversity in practice related to the classification of certain cash receipts and payments for debt prepayment or extinguishment costs, the maturing of a zero-coupon bond, the settlement of contingent liabilities arising from a business combination, proceeds from insurance settlements, distributions from certain equity method investees and beneficial interests obtained in a financial asset securitization. We adopted this standard as of August 1, 2018 using the retrospective transition method, and it did not 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 requires that amounts generally described as restricted cash or restricted cash equivalents be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. We adopted this standard as of August 1, 2018 using the retrospective transition method and we have adjusted our prior period condensed consolidated statement of cash flows to conform to the current presentation. 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 early adopted this standard as of August 1, 2018 using the prospective transition method, which resulted in a cumulative-effect adjustment of $0.3 million recognized within stockholders' equity, as a reduction of additional paid-in capital against accumulated deficit, on the adoption date. In August 2018, the FASB issued ASU No. 2018-15, “Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract ,” which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. The new standard requires capitalized costs to be amortized on a straight-line basis generally over the term of the arrangement, and the financial statement presentation for these capitalized costs would be the same as that of the fees related to the hosting arrangements. For public business entities, this standard is effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. Early adoption is permitted. We early adopted this standard as of August 1, 2018 using the prospective transition method, and it did not have a material impact to our consolidated financial statements. In August 2018, the SEC adopted the final rule under SEC Release No. 33-10532, " Disclosure Update and Simplification ," amending certain disclosure requirements that have become redundant, duplicative, overlapping, outdated or superseded. In addition, the amendments expanded the disclosure requirements on the analysis of stockholders' equity for interim financial statements. Under the amendments, an analysis of changes in each caption of stockholders' equity presented in the balance sheet must be provided in a note or separate statement. The analysis should present a reconciliation of the beginning balance to the ending balance of each period for which a statement of comprehensive income is required to be filed. The final rule is effective November 5, 2018. We early adopted this requirement as of August 1, 2018, presenting the activity of the stockholder's equity accounts in the accompanying condensed statements of redeemable convertible preferred stock and stockholders' equity (deficit) for the periods presented. Recently Issued Accounting Pronouncements Not Yet Adopted In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) ("ASU 2016-02"), which requires lessees to recognize most leases on their balance sheets that do not meet the definition of a short-term lease but recognize the expenses on their statements of operations in a manner similar to current accounting rules. In July 2018, the FASB issued ASU 2018-10, Leases (Topic 842), Codification Improvements ("ASU 2018-10"), which clarifies certain adoption provisions of the new leases standard such as the application of implicit rate, lessee reassessment of lease classification and certain transition adjustments. In addition, in July 2018, the FASB issued ASU 2018-11, Leases (Topic 842), Targeted Improvements ("ASU 2018-11"), which allows for the adoption of ASU 2016-02 to be applied at the beginning of the year of adoption, as opposed to at the beginning of the earliest year presented in the financial statements. These standards are effective for fiscal years beginning after December 15, 2018, with early adoption permitted. We are currently evaluating the effect of these standards; however, we anticipate the most significant effects will relate to the recognition of right-of-use assets and lease liabilities arising from our real estate and data center operating leases that do not meet the definition of a short-term lease on the adoption date and providing qualitative and quantitative disclosures in the notes to the condensed 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. |
Business and Summary of Signi_3
Business and Summary of Significant Accounting Policies (Tables) | 6 Months Ended |
Jan. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
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: Three Months Ended January 31, Six Months Ended January 31, 2019 2018 2019 2018 Amount % Revenue Amount % Revenue Amount % Revenue Amount % Revenue (in thousands, except per percentage data) United States $ 37,626 51 % $ 20,224 45 % $ 67,433 49 % $ 39,985 47 % Europe, Middle East and Africa (*) 29,552 40 % 20,168 45 % 56,946 41 % 37,154 44 % Asia Pacific 5,674 7 % 3,465 8 % 10,463 8 % 6,554 8 % Other 1,450 2 % 1,119 2 % 2,758 2 % 1,144 1 % Total $ 74,302 100 % $ 44,976 100 % $ 137,600 100 % $ 84,837 100 % (*) Revenue from the United Kingdom ("U.K.") represented 10% and 12% of our revenue for the three months ended January 31, 2019 and 2018, respectively, and 10% and 11% for the six months ended January 31, 2019 and 2018, respectively. The following table summarizes the revenue from contracts by type of customer: Three Months Ended January 31, Six Months Ended January 31, 2019 2018 2019 2018 Amount % Revenue Amount % Revenue Amount % Revenue Amount % Revenue (in thousands, except per percentage data) Channel partners $ 71,074 96 % $ 41,258 92 % $ 131,093 95 % $ 77,429 91 % Direct customers 3,228 4 % 3,718 8 % 6,507 5 % 7,408 9 % Total $ 74,302 100 % $ 44,976 100 % $ 137,600 100 % $ 84,837 100 % |
Capitalized Contract Cost | The following table summarizes the activity of the deferred contract acquisition costs: Three Months Ended January 31, Six Months Ended January 31, 2019 2018 2019 2018 (in thousands) Beginning balance $ 55,978 $ 36,002 $ 55,910 $ 34,662 Capitalization of contract acquisition costs 9,080 7,005 13,472 11,213 Amortization of deferred contract acquisition costs (4,457) (3,064) (8,781) (5,932) Ending balance $ 60,601 $ 39,943 $ 60,601 $ 39,943 As of the end of the period: Deferred contract acquisition costs, current $ 18,058 $ 12,271 $ 18,058 $ 12,271 Deferred contract acquisition costs, noncurrent 42,543 27,672 42,543 27,672 Total deferred contract acquisition costs $ 60,601 $ 39,943 $ 60,601 $ 39,943 |
Cash Equivalents and Short-Te_2
Cash Equivalents and Short-Term Investments (Tables) | 6 Months Ended |
Jan. 31, 2019 | |
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 January 31, 2019: Amortized Unrealized Unrealized (in thousands) Cash equivalents: Money market funds $ 49,405 $ — $ — $ 49,405 U.S. treasury securities 4,993 — (1) 4,992 Total cash equivalents $ 54,398 $ — $ (1) $ 54,397 Short-term investments: U.S. treasury securities $ 130,212 $ 13 $ (15) $ 130,210 U.S. government agency securities 44,399 3 (44) 44,358 Corporate debt securities 97,923 50 (65) 97,908 Total short-term investments $ 272,534 $ 66 $ (124) $ 272,476 Total cash equivalents and short-term investments $ 326,932 $ 66 $ (125) $ 326,873 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 |
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 January 31, 2019: Amortized Fair Value (in thousands) Due within one year $ 213,194 $ 213,163 Due between one and two years 59,340 59,313 Total short-term investments $ 272,534 $ 272,476 |
Schedule of Unrealized Loss on Investments | Short-term investments that were in an unrealized loss position consisted of the following as of January 31, 2019: Less than 12 Months Greater than 12 Months Total Fair Unrealized Fair Unrealized Fair Unrealized (in thousands) U.S. treasury securities $ 83,321 $ (15) $ — $ — $ 83,321 $ (15) U.S. government agency securities 35,588 (44) — — 35,588 (44) Corporate debt securities 72,855 (65) — — 72,855 (65) Total investments in a loss position $ 191,764 $ (124) $ — $ — $ 191,764 $ (124) 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) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jan. 31, 2019 | |
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 January 31, 2019: 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 $ 49,405 $ 49,405 $ — $ — U.S. treasury securities 4,992 — 4,992 — Total cash equivalents $ 54,397 $ 49,405 $ 4,992 $ — Short-term investments: U.S. treasury securities $ 130,210 $ — $ 130,210 $ — U.S. government agency securities 44,358 — 44,358 — Corporate debt securities 97,908 — 97,908 — Total short-term investments $ 272,476 $ — $ 272,476 $ — 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 $ — |
Property and Equipment (Tables)
Property and Equipment (Tables) | 6 Months Ended |
Jan. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Property and equipment consisted of the following: January 31, 2019 July 31, 2018 (in thousands) Hosting equipment $ 39,960 $ 30,743 Computers and equipment 2,573 2,335 Purchased software 1,314 1,324 Capitalized internal-use software 7,066 6,163 Furniture and fixtures 1,514 1,478 Leasehold improvements 2,123 2,123 Property and equipment, gross 54,550 44,166 Less: Accumulated depreciation and amortization (28,788) (24,401) Total property and equipment, net $ 25,762 $ 19,765 |
Acquired Intangible Assets, N_2
Acquired Intangible Assets, Net (Tables) | 6 Months Ended |
Jan. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Acquired Intangible Assets | The gross carrying amount and accumulated amortization of acquired intangible assets consisted of the following as of January 31, 2019: Gross Carrying Amount Accumulated Amortization Net Book Value (in thousands) Developed technology $ 1,716 $ (239) $ 1,477 |
Schedule of Future Amortization Expense | Future amortization expense of acquired intangible assets consisted of the following as of January 31, 2019: Amortization Year ending July 31, (in thousands) 2019 (remaining six months) $ 286 2020 572 2021 572 2022 47 Total $ 1,477 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 6 Months Ended |
Jan. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Rental Payments for Operating Leases | Future minimum payments under our non-cancelable operating leases consisted of the following as of January 31, 2019: Operating (in thousands) Year ending July 31, 2019 (remaining six months) $ 1,578 2020 2,588 2021 1,604 2022 18 Total $ 5,788 |
Schedule of Future Minimum Payments for Other Commitments | Future minimum payments under our non-cancelable data center contracts consisted of the following as of January 31, 2019: Data Center Contracts (in thousands) Year ending July 31, 2019 (remaining six months) $ 4,416 2020 6,710 2021 4,131 2022 933 Total $ 16,190 Bandwidth and colocation expenses are recognized as cost of revenue and were $3.4 million and $2.2 million for the three months ended January 31, 2019 and 2018, respectively, and $6.4 million and $4.3 million for the six months ended January 31, 2019 and 2018, respectively. |
Common Stock (Tables)
Common Stock (Tables) | 6 Months Ended |
Jan. 31, 2019 | |
Equity [Abstract] | |
Schedule of Common Stock Reserved for Future Issuance | Shares of common stock reserved for future issuance consisted of the following as of January 31, 2019: Underlying Shares (in thousands) Equity awards outstanding: Stock options 12,028 Unvested restricted stock units 3,037 Unvested performance stock units, based on the target number of shares granted (*) 1,460 Purchase rights committed under the employee stock purchase plan 1,410 Equity awards available for future grants: Equity incentive plans 15,815 Employee stock purchase plan 1,361 Total reserved shares of common stock for future issuance 35,111 (*) Holders of performance stock units corresponding to fiscal 2019, as further described in Note 9, have the ability to receive up to 150% of the target number of shares granted if the maximum achievement of target performance metrics is attained. |
Stock Based Compensation (Table
Stock Based Compensation (Tables) | 6 Months Ended |
Jan. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of Stock Options | The activity of stock options consisted of the following: Outstanding Weighted-Average Weighted-Average Aggregate (in thousands, except per share amounts) Balance as of July 31, 2018 16,175 $ 6.20 5.1 $ 470,860 Stock options exercised (3,511) $ 4.41 $ 129,596 Stock options canceled, forfeited or expired (636) $ 6.22 Balance as of January 31, 2019 12,028 $ 6.72 4.9 $ 500,853 Exercisable and expected to vest as of July 31, 2018 5,499 $ 3.97 4.0 $ 172,317 Exercisable and expected to vest as of January 31, 2019 4,055 $ 4.52 4.0 $ 177,830 |
Schedule of Restricted Stock Units Activity | The activity of RSUs consisted of the following: RSUs Outstanding Weighted-Average Grant Date Fair Value per Share Aggregate (in thousands, except per share amounts) Balance as of July 31, 2018 209 $ 26.26 $ 7,394 Granted 2,888 $ 40.20 Vested (3) $ 44.26 $ 111 Canceled, forfeited (57) $ 40.36 Balance as of January 31, 2019 3,037 $ 39.23 $ 146,897 |
Schedule of Unvested Performance Stock Units | The number of unvested PSUs outstanding based on the target number of shares granted consisted of the following as of January 31, 2019: Underlying Shares Performance periods (in thousands) Fiscal 2019 464 Fiscal 2020 464 Fiscal 2021 150 Fiscal 2022 150 Total 1,228 |
Schedule of Performance Stock Units Activity | The activity of PSUs for which performance conditions have been established and are expected to be earned consisted of the following: Underlying Shares Weighted-Average Grant Date Fair Value per Share Aggregate (in thousands, except for share amounts) Balance as of July 31, 2018 — — $ — Granted 464 $ 36.90 Vested — — $ — Canceled, forfeited — — Balance as of January 31, 2019 464 $ 36.90 $ 22,456 |
Schedule of ESPP Valuation Assumptions | The fair value of the purchase right for the ESPP is estimated on the date of grant using the Black-Scholes model with the following assumptions: Six Months Ended January 31, 2019 Expected term (in years) 0.5 - 2.0 Expected stock price volatility 44.0% - 61.9% Risk-free interest rate 2.5% - 2.7% Dividend yield 0.0% |
Schedule of Allocation of Stock-based Compensation Expense | The components of stock-based compensation expense recognized in the condensed consolidated statements of operations consisted of the following: Three Months Ended January 31, Six Months Ended January 31, 2019 2018 2019 2018 (in thousands) Cost of revenue $ 619 $ 126 1,122 $ 235 Sales and marketing 5,517 985 8,318 1,770 Research and development 4,398 494 7,193 892 General and administrative 2,693 459 4,180 900 Total stock-based compensation expense $ 13,227 $ 2,064 $ 20,813 $ 3,797 |
Outstanding stock options | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of Valuation Assumptions | We estimated the fair value of employee stock option using the Black-Scholes option pricing model with the following assumptions. Six Months Ended January 31, 2018 Expected term (in years) 4.6 Expected stock price volatility 40.4% - 41.5% Risk-free interest rate 1.7% - 2.6% Dividend yield 0.0% |
Net Loss Per Share Attributab_2
Net Loss Per Share Attributable to Common Stockholders (Tables) | 6 Months Ended |
Jan. 31, 2019 | |
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: Three Months Ended Six months ended 2019 2018 2019 2018 (in thousands) Net loss $ (3,555) $ (6,515) $ (11,143) $ (17,913) Accretion of Series C and D redeemable convertible preferred stock — (2,579) — (5,109) Net loss attributable to common stockholders $ (3,555) $ (9,094) $ (11,143) $ (23,022) Weighted-average shares used in computing net loss per share attributable to common stockholders, basic and diluted 122,741 31,434 121,664 31,125 Net loss per share attributable to common stockholders, basic and diluted $ (0.03) $ (0.29) $ (0.09) $ (0.74) |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The following table summarizes the unweighted outstanding potentially dilutive securities that were excluded from the computation of the diluted net loss per share attributable to common stockholders because the impact of including them would have been antidilutive: January 31, 2019 2018 (in thousands) Convertible preferred stock — 72,501 Outstanding stock options 12,028 14,949 Shares subject to repurchase from early exercised stock options 239 1,171 Purchase rights committed under the ESPP 1,410 — Unvested RSUs 3,037 — Unvested PSUs (*) 464 — Total 17,178 88,621 (*) The number of unvested PSUs is based on the target number of shares granted and excludes unvested PSUs for which performance conditions have not been established as of January 31, 2019, as they are not considered outstanding for accounting purposes. Refer to Note 9 for further information. |
Significant Customers and Geo_2
Significant Customers and Geographic Information (Tables) | 6 Months Ended |
Jan. 31, 2019 | |
Risks and Uncertainties [Abstract] | |
Schedule of Accounts Receivable | The following table summarizes 10% or more of the total balance of accounts receivable, net: January 31, 2019 July 31, 2018 Channel partner A 13% * Channel partner B * 13% Channel partner C * 13% (*) Represents less than 10%. |
Schedule of Long-Lived Assets | Our long-lived assets consist of property, equipment and intangible assets, which are summarized by geographic area as follows: January 31, 2019 July 31, 2018 (in thousands) United States $ 20,336 $ 14,742 Rest of the world 7,559 5,023 Total long-lived assets $ 27,895 $ 19,765 |
Business and Summary of Signi_4
Business and Summary of Significant Accounting Policies - Narrative (Details) $ / shares in Units, $ in Thousands | Mar. 31, 2018USD ($)$ / shares | Mar. 31, 2018USD ($)$ / sharesshares | Jan. 31, 2019USD ($) | Jan. 31, 2018 | Jan. 31, 2019USD ($) | Jan. 31, 2018USD ($) | Aug. 01, 2018USD ($) | Jul. 31, 2018USD ($) | Jul. 31, 2017USD ($) |
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 | |||||||
Net proceeds from shares sold | $ 205,300 | ||||||||
Payments of costs related to initial public offering | $ 15,500 | $ 1,797 | $ 2,896 | ||||||
Offering costs | $ 6,200 | ||||||||
Conversion of redeemable convertible preferred stock to common stock upon initial public offering (in shares) | shares | 72,500,750 | ||||||||
Conversion ratio | 1 | ||||||||
Contract with customer, liability, revenue recognized | 68,200 | $ 58,600 | |||||||
Revenue, remaining performance obligation | $ 461,000 | 461,000 | |||||||
Accrued sales commissions | $ 4,600 | $ 4,600 | $ 10,000 | ||||||
Cumulative effect of new accounting principle | $ 0 | $ 0 | |||||||
Sales Revenue, Net | Geographic Concentration Risk | |||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||
Concentration risk percentage | 100.00% | 100.00% | 100.00% | 100.00% | |||||
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 | 97.00% | 99.00% | 98.00% | 98.00% | |||||
Retained Earnings | |||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||
Cumulative effect of new accounting principle | 300 | (438) | |||||||
Additional Paid-In Capital | |||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||
Cumulative effect of new accounting principle | $ (300) | $ 438 | |||||||
Minimum | |||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||
Contract with customer, term of contract | 1 year | ||||||||
Maximum | |||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||
Contract with customer, term of contract | 3 years | ||||||||
ASU 2018-07 | Retained Earnings | |||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||
Cumulative effect of new accounting principle | 300 | ||||||||
ASU 2018-07 | Additional Paid-In Capital | |||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||
Cumulative effect of new accounting principle | $ (300) | ||||||||
United Kingdom | Sales Revenue, Net | Geographic Concentration Risk | |||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||
Concentration risk percentage | 10.00% | 12.00% | 10.00% | 11.00% |
Business and Summary of Signi_5
Business and Summary of Significant Accounting Policies - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jan. 31, 2019 | Jan. 31, 2018 | Jan. 31, 2019 | Jan. 31, 2018 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 74,302 | $ 44,976 | $ 137,600 | $ 84,837 |
Channel partners | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 71,074 | 41,258 | 131,093 | 77,429 |
Direct customers | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 3,228 | $ 3,718 | $ 6,507 | $ 7,408 |
Geographic Concentration Risk | Sales Revenue, Net | ||||
Disaggregation of Revenue [Line Items] | ||||
Concentration risk percentage | 100.00% | 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% | 100.00% |
Customer Concentration Risk | Sales Revenue, Net | Channel partners | ||||
Disaggregation of Revenue [Line Items] | ||||
Concentration risk percentage | 96.00% | 92.00% | 95.00% | 91.00% |
Customer Concentration Risk | Sales Revenue, Net | Direct customers | ||||
Disaggregation of Revenue [Line Items] | ||||
Concentration risk percentage | 4.00% | 8.00% | 5.00% | 9.00% |
United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 37,626 | $ 20,224 | $ 67,433 | $ 39,985 |
United States | Geographic Concentration Risk | Sales Revenue, Net | ||||
Disaggregation of Revenue [Line Items] | ||||
Concentration risk percentage | 51.00% | 45.00% | 49.00% | 47.00% |
Europe, Middle East and Africa | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 29,552 | $ 20,168 | $ 56,946 | $ 37,154 |
Europe, Middle East and Africa | Geographic Concentration Risk | Sales Revenue, Net | ||||
Disaggregation of Revenue [Line Items] | ||||
Concentration risk percentage | 40.00% | 45.00% | 41.00% | 44.00% |
Asia Pacific | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 5,674 | $ 3,465 | $ 10,463 | $ 6,554 |
Asia Pacific | Geographic Concentration Risk | Sales Revenue, Net | ||||
Disaggregation of Revenue [Line Items] | ||||
Concentration risk percentage | 7.00% | 8.00% | 8.00% | 8.00% |
Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 1,450 | $ 1,119 | $ 2,758 | $ 1,144 |
Other | Geographic Concentration Risk | Sales Revenue, Net | ||||
Disaggregation of Revenue [Line Items] | ||||
Concentration risk percentage | 2.00% | 2.00% | 2.00% | 1.00% |
Business and Summary of Signi_6
Business and Summary of Significant Accounting Policies - Summary of Deferred Contract Acquisition Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||||
Jan. 31, 2019 | Jan. 31, 2018 | Jan. 31, 2019 | Jan. 31, 2018 | Jan. 31, 2019 | Jul. 31, 2018 | Jan. 31, 2018 | |
Changes in Capitalized Contract Cost [Roll Forward] | |||||||
Beginning balance | $ 55,978 | $ 36,002 | $ 55,910 | $ 34,662 | |||
Capitalization of contract acquisition costs | 9,080 | 7,005 | 13,472 | 11,213 | |||
Amortization of deferred contract acquisition costs | (4,457) | (3,064) | (8,781) | (5,932) | |||
Ending balance | 60,601 | 39,943 | 60,601 | 39,943 | |||
Deferred contract acquisition costs, current | $ 18,058 | $ 16,136 | $ 12,271 | ||||
Deferred contract acquisition costs, noncurrent | 42,543 | 39,774 | 27,672 | ||||
Total deferred contract acquisition costs | $ 55,978 | $ 36,002 | $ 55,910 | $ 34,662 | $ 60,601 | $ 55,910 | $ 39,943 |
Business and Summary of Signi_7
Business and Summary of Significant Accounting Policies - Remaining Performance Obligation (Details) | 3 Months Ended |
Jan. 31, 2019 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-01-31 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, percentage | 55.00% |
Recognized transaction price period | 12 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-01-31 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, percentage | 98.00% |
Recognized transaction price period | 3 years |
Cash Equivalents and Short-Te_3
Cash Equivalents and Short-Term Investments - Schedule of Cash Equivalents and Short-term Investments (Details) - USD ($) $ in Thousands | Jan. 31, 2019 | Jul. 31, 2018 |
Debt Securities, Available-for-sale [Line Items] | ||
Cash equivalents, amortized cost | $ 54,398 | $ 104,905 |
Cash equivalents, unrealized gains | 0 | 0 |
Cash equivalents, unrealized losses | (1) | (1) |
Cash equivalents | 54,397 | 104,904 |
Short-term investments, amortized cost basis | 272,534 | 163,083 |
Short-term investment, unrealized gains | 66 | 1 |
Short-term investments, unrealized losses | (124) | (124) |
Short-term investments | 272,476 | 162,960 |
Cash equivalents and short-term investments, amortized cost | 326,932 | 267,988 |
Cash equivalents and short-term investments, unrealized gains | 66 | 1 |
Cash equivalents and short-term investments, unrealized losses | (125) | (125) |
Cash equivalents and short-term investments, estimated fair value | 326,873 | 267,864 |
Money market funds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Cash equivalents, amortized cost | 49,405 | 74,408 |
Cash equivalents, unrealized gains | 0 | 0 |
Cash equivalents, unrealized losses | 0 | 0 |
Cash equivalents | 49,405 | 74,408 |
U.S. treasury securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Cash equivalents, amortized cost | 4,993 | 17,488 |
Cash equivalents, unrealized gains | 0 | 0 |
Cash equivalents, unrealized losses | (1) | 0 |
Cash equivalents | 4,992 | 17,488 |
Short-term investments, amortized cost basis | 130,212 | 55,768 |
Short-term investment, unrealized gains | 13 | 0 |
Short-term investments, unrealized losses | (15) | (17) |
Short-term investments | 130,210 | 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 | |
Cash equivalents | 1,999 | |
Short-term investments, amortized cost basis | 44,399 | 17,953 |
Short-term investment, unrealized gains | 3 | 0 |
Short-term investments, unrealized losses | (44) | (19) |
Short-term investments | 44,358 | 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) | |
Cash equivalents | 11,009 | |
Short-term investments, amortized cost basis | 97,923 | 89,362 |
Short-term investment, unrealized gains | 50 | 1 |
Short-term investments, unrealized losses | (65) | (88) |
Short-term investments | $ 97,908 | $ 89,275 |
Cash Equivalents and Short-Te_4
Cash Equivalents and Short-Term Investments - Schedule of Maturities (Details) - USD ($) $ in Thousands | Jan. 31, 2019 | Jul. 31, 2018 |
Amortized Cost | ||
Due within one year, cost basis | $ 213,194 | |
Due between one and two years, cost basis | 59,340 | |
Short-term investments, amortized cost basis | 272,534 | $ 163,083 |
Fair Value | ||
Due within one year, fair value | 213,163 | |
Due between one and two years, fair value | 59,313 | |
Total short-term investments, fair value | $ 272,476 | $ 162,960 |
Cash Equivalents and Short-Te_5
Cash Equivalents and Short-Term Investments - Schedule of Unrealized Position (Details) - USD ($) $ in Thousands | Jan. 31, 2019 | Jul. 31, 2018 |
Debt Securities, Available-for-sale [Line Items] | ||
Less than 12 months, fair value | $ 191,764 | $ 157,016 |
Less than 12 months, unrealized losses | (124) | (124) |
Greater than 12 months, fair value | 0 | 0 |
Greater than 12 months, unrealized losses | 0 | 0 |
Total fair value | 191,764 | 157,016 |
Total unrealized losses | (124) | (124) |
U.S. treasury securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Less than 12 months, fair value | 83,321 | 55,750 |
Less than 12 months, unrealized losses | (15) | (17) |
Greater than 12 months, fair value | 0 | 0 |
Greater than 12 months, unrealized losses | 0 | 0 |
Total fair value | 83,321 | 55,750 |
Total unrealized losses | (15) | (17) |
U.S. government agency securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Less than 12 months, fair value | 35,588 | 17,934 |
Less than 12 months, unrealized losses | (44) | (19) |
Greater than 12 months, fair value | 0 | 0 |
Greater than 12 months, unrealized losses | 0 | 0 |
Total fair value | 35,588 | 17,934 |
Total unrealized losses | (44) | (19) |
Corporate debt securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Less than 12 months, fair value | 72,855 | 83,332 |
Less than 12 months, unrealized losses | (65) | (88) |
Greater than 12 months, fair value | 0 | 0 |
Greater than 12 months, unrealized losses | 0 | 0 |
Total fair value | 72,855 | 83,332 |
Total unrealized losses | $ (65) | $ (88) |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Thousands | Jan. 31, 2019 | Jul. 31, 2018 |
Cash equivalents: | ||
Cash equivalents | $ 54,397 | $ 104,904 |
Short-term investments | 272,476 | 162,960 |
Fair Value, Measurements, Recurring | ||
Cash equivalents: | ||
Cash equivalents | 54,397 | 104,904 |
Short-term investments | 272,476 | 162,960 |
Fair Value, Measurements, Recurring | Level I | ||
Cash equivalents: | ||
Cash equivalents | 49,405 | 74,408 |
Short-term investments | 0 | 0 |
Fair Value, Measurements, Recurring | Level II | ||
Cash equivalents: | ||
Cash equivalents | 4,992 | 30,496 |
Short-term investments | 272,476 | 162,960 |
Fair Value, Measurements, Recurring | Level III | ||
Cash equivalents: | ||
Cash equivalents | 0 | 0 |
Short-term investments | 0 | 0 |
Money market funds | ||
Cash equivalents: | ||
Cash equivalents | 49,405 | 74,408 |
Money market funds | Fair Value, Measurements, Recurring | ||
Cash equivalents: | ||
Cash equivalents | 49,405 | 74,408 |
Money market funds | Fair Value, Measurements, Recurring | Level I | ||
Cash equivalents: | ||
Cash equivalents | 49,405 | 74,408 |
Money market funds | Fair Value, Measurements, Recurring | Level II | ||
Cash equivalents: | ||
Cash equivalents | 0 | 0 |
Money market funds | Fair Value, Measurements, Recurring | Level III | ||
Cash equivalents: | ||
Cash equivalents | 0 | 0 |
U.S. treasury securities | ||
Cash equivalents: | ||
Cash equivalents | 4,992 | 17,488 |
Short-term investments | 130,210 | 55,751 |
U.S. treasury securities | Fair Value, Measurements, Recurring | ||
Cash equivalents: | ||
Cash equivalents | 4,992 | 17,488 |
Short-term investments | 130,210 | 55,751 |
U.S. treasury securities | Fair Value, Measurements, Recurring | Level I | ||
Cash equivalents: | ||
Cash equivalents | 0 | 0 |
Short-term investments | 0 | 0 |
U.S. treasury securities | Fair Value, Measurements, Recurring | Level II | ||
Cash equivalents: | ||
Cash equivalents | 4,992 | 17,488 |
Short-term investments | 130,210 | 55,751 |
U.S. treasury securities | Fair Value, Measurements, Recurring | Level III | ||
Cash equivalents: | ||
Cash equivalents | 0 | 0 |
Short-term investments | 0 | 0 |
U.S. government agency securities | ||
Cash equivalents: | ||
Cash equivalents | 1,999 | |
Short-term investments | 44,358 | 17,934 |
U.S. government agency securities | Fair Value, Measurements, Recurring | ||
Cash equivalents: | ||
Cash equivalents | 1,999 | |
Short-term investments | 44,358 | 17,934 |
U.S. government agency securities | Fair Value, Measurements, Recurring | Level I | ||
Cash equivalents: | ||
Cash equivalents | 0 | |
Short-term investments | 0 | 0 |
U.S. government agency securities | Fair Value, Measurements, Recurring | Level II | ||
Cash equivalents: | ||
Cash equivalents | 1,999 | |
Short-term investments | 44,358 | 17,934 |
U.S. government agency securities | Fair Value, Measurements, Recurring | Level III | ||
Cash equivalents: | ||
Cash equivalents | 0 | |
Short-term investments | 0 | 0 |
Corporate debt securities | ||
Cash equivalents: | ||
Cash equivalents | 11,009 | |
Short-term investments | 97,908 | 89,275 |
Corporate debt securities | Fair Value, Measurements, Recurring | ||
Cash equivalents: | ||
Cash equivalents | 11,009 | |
Short-term investments | 97,908 | 89,275 |
Corporate debt securities | Fair Value, Measurements, Recurring | Level I | ||
Cash equivalents: | ||
Cash equivalents | 0 | |
Short-term investments | 0 | 0 |
Corporate debt securities | Fair Value, Measurements, Recurring | Level II | ||
Cash equivalents: | ||
Cash equivalents | 11,009 | |
Short-term investments | 97,908 | 89,275 |
Corporate debt securities | Fair Value, Measurements, Recurring | Level III | ||
Cash equivalents: | ||
Cash equivalents | 0 | |
Short-term investments | $ 0 | $ 0 |
Property and Equipment - Schedu
Property and Equipment - Schedule of Property and Equipment (Details) - USD ($) $ in Thousands | Jan. 31, 2019 | Jul. 31, 2018 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 54,550 | $ 44,166 |
Less: Accumulated depreciation and amortization | (28,788) | (24,401) |
Total property and equipment, net | 25,762 | 19,765 |
Hosting equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 39,960 | 30,743 |
Computers and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 2,573 | 2,335 |
Purchased software | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 1,314 | 1,324 |
Capitalized internal-use software | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 7,066 | 6,163 |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 1,514 | 1,478 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 2,123 | $ 2,123 |
Property and Equipment - Narrat
Property and Equipment - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jan. 31, 2019 | Jan. 31, 2018 | Jan. 31, 2019 | Jan. 31, 2018 | |
Property, Plant and Equipment [Abstract] | ||||
Depreciation and amortization expense | $ 2,500 | $ 2,000 | $ 4,662 | $ 3,910 |
Acquired Intangible Assets, N_3
Acquired Intangible Assets, Net (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |
Jan. 31, 2019 | Jan. 31, 2019 | Jan. 31, 2018 | |
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Amortization of acquired intangible assets | $ 239 | $ 0 | |
Developed technology | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Weighted average useful lives | 2 years 7 months 6 days | ||
Amortization of acquired intangible assets | $ 100 | $ 200 |
Acquired Intangible Assets, N_4
Acquired Intangible Assets, Net - Schedule of Acquired Intangible Assets (Details) $ in Thousands | Jan. 31, 2019USD ($) |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Gross Carrying Amount | $ 1,477 |
Developed technology | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Gross Carrying Amount | 1,716 |
Accumulated Amortization | (239) |
Net Book Value | $ 1,477 |
Acquired Intangible Assets, N_5
Acquired Intangible Assets, Net - Schedule of Future Amortization Expense (Details) $ in Thousands | Jan. 31, 2019USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2019 (remaining six months) | $ 286 |
2,020 | 572 |
2,021 | 572 |
2,022 | 47 |
Total | $ 1,477 |
Commitments and Contingencies -
Commitments and Contingencies - Summary of Future Minimum Payments Under Operating Leases (Details) $ in Thousands | Jan. 31, 2019USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2019 (remaining six months) | $ 1,578 |
2,020 | 2,588 |
2,021 | 1,604 |
2,022 | 18 |
Total | $ 5,788 |
Commitments and Contingencies_2
Commitments and Contingencies - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jan. 31, 2019 | Jan. 31, 2018 | Jan. 31, 2019 | Jan. 31, 2018 | Jul. 31, 2018 | Jul. 31, 2017 | |
Loss Contingencies [Line Items] | ||||||
Rent expense | $ 0.8 | $ 0.6 | $ 1.4 | $ 1.1 | ||
Bandwidth and colocation costs | 3.4 | $ 2.2 | 6.4 | $ 4.3 | ||
Purchase obligation | 3.7 | 3.7 | $ 3.1 | |||
Finjan Litigation | ||||||
Loss Contingencies [Line Items] | ||||||
Accrued liability for potential lawsuit loss | $ 3.2 | $ 3.2 | ||||
Loss recognized | $ 0.7 | $ 2.5 |
Commitments and Contingencies_3
Commitments and Contingencies - Future Minimum Payments Due Under Data Center Contracts (Details) $ in Thousands | Jan. 31, 2019USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2019 (remaining six months) | $ 4,416 |
2,020 | 6,710 |
2,021 | 4,131 |
2,022 | 933 |
Total | $ 16,190 |
Preferred Stock (Details)
Preferred Stock (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||||
Mar. 31, 2018USD ($)shares | Jan. 31, 2018USD ($) | Jan. 31, 2018USD ($) | Jan. 31, 2019USD ($) | Oct. 31, 2018USD ($) | Jul. 31, 2018USD ($) | Oct. 31, 2017USD ($) | Jul. 31, 2017USD ($) | |
Temporary Equity Disclosure [Abstract] | ||||||||
Conversion of redeemable convertible preferred stock to common stock upon initial public offering (in shares) | shares | 72,500,750 | |||||||
Conversion ratio | 1 | |||||||
Temporary equity, carrying value | $ 207,300 | $ 206,086 | $ 206,086 | $ 0 | $ 0 | $ 0 | $ 203,507 | $ 200,977 |
Temporary equity, accretion value | $ 24,700 | |||||||
Accretion of Series C and D redeemable convertible preferred stock | $ 2,579 | $ 5,109 |
Common Stock (Details)
Common Stock (Details) | Jan. 31, 2019vote |
Equity [Abstract] | |
Common stock, number of votes per share | 1 |
Common Stock - Schedule of Comm
Common Stock - Schedule of Common Stock Reserved for Future Issuance (Details) - shares | 6 Months Ended | |
Jan. 31, 2019 | Jul. 31, 2018 | |
Subsidiary, Sale of Stock [Line Items] | ||
Equity awards outstanding (in shares) | 12,028,000 | 16,175,000 |
Equity awards available for future grants (in shares) | 35,111,000 | |
Outstanding stock options | ||
Subsidiary, Sale of Stock [Line Items] | ||
Equity awards outstanding (in shares) | 12,028,000 | |
Unvested RSUs | ||
Subsidiary, Sale of Stock [Line Items] | ||
Equity awards outstanding (in shares) | 3,037,000 | |
Unvested performance stock units, based on the target number of shares originally granted | ||
Subsidiary, Sale of Stock [Line Items] | ||
Equity awards outstanding (in shares) | 1,460,000 | |
Percentage of shares originally granted | 150.00% | |
Equity incentive plans | ||
Subsidiary, Sale of Stock [Line Items] | ||
Equity awards available for future grants (in shares) | 15,815,000 | |
Employee stock purchase plan | ||
Subsidiary, Sale of Stock [Line Items] | ||
Equity awards outstanding (in shares) | 1,410,000 | |
Equity awards available for future grants (in shares) | 1,361,000 |
Stock Based Compensation - Narr
Stock Based Compensation - Narrative (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jan. 31, 2019USD ($)$ / sharesshares | Jan. 31, 2018USD ($) | Jan. 31, 2019USD ($)vote$ / sharesshares | Jan. 31, 2018USD ($) | Jul. 31, 2018USD ($)shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Shares available for issuance (in shares) | shares | 18,688,000 | 18,688,000 | |||
Shares available for grant (in shares) | shares | 15,815,000 | 15,815,000 | |||
Options exercised, aggregate intrinsic value | $ 129,596 | $ 5,200 | |||
Weighted average grant date fair value (in dollars per share) | $ / shares | $ 3.12 | ||||
Vesting of early exercised stock options | $ 277 | $ 467 | $ 567 | 1,015 | |
Interest receivable | $ 100 | ||||
Outstanding notes receivable, carrying amount | 2,100 | ||||
Repayment of loans | 2,100 | ||||
Unrecognized compensation cost | $ 148,500 | $ 148,500 | |||
Unrecognized compensation cost, weighted-average | 3 years 6 months | ||||
Unvested RSUs | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting period | 4 years | ||||
Unvested performance stock units | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Percentage of shares originally granted | 150.00% | ||||
Outstanding stock options | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting period | 4 years | ||||
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 | 2018 Employee Stock Purchase Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Shares available for issuance (in shares) | shares | 3,397,643 | 3,397,643 | |||
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% | ||||
Duration of offering period | 24 months | ||||
Number of purchases periods | vote | 4 | ||||
Duration of purchase periods | 6 months | ||||
Shares issued (in shares) | shares | 627,000 | ||||
Weighted-average purchase price per share (in dollars per share) | $ / shares | $ 13.86 | $ 13.86 | |||
Cash proceeds from the issuance of common stock | $ 8,700 | ||||
Accrued compensation | $ 2,200 | $ 2,200 | $ 4,600 | ||
Fiscal 2019 | Unvested RSUs | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting rights, percentage | 25.00% | ||||
Fiscal 2019 | Outstanding stock options | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting rights, percentage | 25.00% | ||||
Common Stock | 2007 Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Common stock subject to repurchase (in shares) | shares | 238,662 | 238,662 | 422,528 | ||
Shares subject to repurchase, value | $ 1,000 | $ 1,000 | $ 1,600 | ||
Additional Paid-In Capital | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting of early exercised stock options | $ 277 | $ 467 | $ 567 | $ 1,015 |
Stock Based Compensation - Sche
Stock Based Compensation - Schedule of Stock Options (Details) - USD ($) $ / shares in Units, $ in Thousands | 6 Months Ended | 12 Months Ended | |
Jan. 31, 2019 | Jan. 31, 2018 | Jul. 31, 2018 | |
Outstanding Stock Options | |||
Balance (in shares) | 16,175,000 | ||
Stock options exercised (in shares) | (3,511,000) | ||
Stock options canceled, forfeited, expired (in shares) | (636,000) | ||
Balance (in shares) | 12,028,000 | 16,175,000 | |
Exercisable and expected to vest as of July 31, 2018 (in shares) | 5,499,000 | ||
Exercisable and expected to vest as of January 31, 2019 (in shares) | 4,055,000 | 5,499,000 | |
Weighted-Average Exercise Price | |||
Beginning balance (in dollars per share) | $ 6.20 | ||
Stock options exercised (in dollars per share) | 4.41 | ||
Stock options canceled, forfeited, expired (in dollars per share) | 6.22 | ||
Ending balance (in dollars per share) | 6.72 | $ 6.20 | |
Exercisable and expected to vest as of July 31, 2018 (in dollars per share) | 3.97 | ||
Exercisable and expected to vest as of January 31, 2019 (in dollars per share) | $ 4.52 | $ 3.97 | |
Additional Disclosures | |||
Options outstanding, weighted average remaining contractual term | 4 years 10 months 24 days | 5 years 1 month 6 days | |
Exercisable and expected to vest, weighted average remaining contractual term | 4 years | 4 years | |
Options outstanding, aggregate intrinsic value | $ 500,853 | $ 470,860 | |
Options exercised, aggregate intrinsic value | 129,596 | $ 5,200 | |
Exercisable and expected to vest, aggregate intrinsic value | $ 177,830 | $ 172,317 |
Stock Based Compensation - Valu
Stock Based Compensation - Valuation Assumptions (Details) | 6 Months Ended |
Jan. 31, 2019 | |
Outstanding stock options | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected term (in years) | 4 years 7 months 6 days |
Dividend yield | 0.00% |
Employee Stock | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Dividend yield | 0.00% |
Minimum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected term (in years) | 6 months |
Expected stock price volatility | 44.00% |
Risk-free interest rate | 2.50% |
Minimum | Outstanding stock options | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected stock price volatility | 40.40% |
Risk-free interest rate | 1.70% |
Maximum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected term (in years) | 2 years |
Expected stock price volatility | 69.10% |
Risk-free interest rate | 2.70% |
Maximum | Outstanding stock options | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected stock price volatility | 41.50% |
Risk-free interest rate | 2.60% |
Stock Based Compensation - Sc_2
Stock Based Compensation - Schedule of RSU Activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 6 Months Ended | |
Jan. 31, 2019 | Jul. 31, 2018 | |
Aggregate Intrinsic Value | ||
Balance | $ 22,456 | |
Vested | $ 0 | |
Unvested RSUs | ||
Number of Shares | ||
Beginning balance (in shares) | 209 | |
Granted (in shares) | 2,888 | |
Vested (in shares) | (3) | |
Canceled, forfeited (in shares) | (57) | |
Ending balance (in shares) | 3,037 | |
Weighted-Average Grant Date Fair Value per Share | ||
Balance (in dollars per share) | $ 39.23 | $ 26.26 |
Granted (in dollars per share) | 40.20 | |
Vested (in dollars per share) | 44.26 | |
Canceled, forfeited (in shares) | $ 40.36 | |
Aggregate Intrinsic Value | ||
Balance | $ 146,897 | $ 7,394 |
Vested | $ 111 |
Stock Based Compensation - Sc_3
Stock Based Compensation - Schedule of Unvested PSUs (Details) | Jan. 31, 2019shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Target Shares (in shares) | 1,228,000 |
Fiscal 2,019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Target Shares (in shares) | 464,000 |
Fiscal 2,020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Target Shares (in shares) | 464,000 |
Fiscal 2,021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Target Shares (in shares) | 150,000 |
Fiscal 2,022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Target Shares (in shares) | 150,000 |
Stock Based Compensation - Sc_4
Stock Based Compensation - Schedule of PSU Activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 6 Months Ended | |
Jan. 31, 2019 | Jul. 31, 2018 | |
Aggregate Intrinsic Value | ||
Balance | $ 22,456 | |
Vested | $ 0 | |
Unvested performance stock units | ||
Number of Shares | ||
Beginning balance (in shares) | 0 | |
Granted (in shares) | 464 | |
Vested (in shares) | 0 | |
Canceled, forfeited (in shares) | 0 | |
Ending balance (in shares) | 464 | |
Weighted-Average Grant Date Fair Value per Share | ||
Balance (in dollars per share) | $ 36.90 | $ 0 |
Granted (in dollars per share) | 36.90 | |
Vested (in dollars per share) | 0 | |
Canceled, forfeited (in shares) | $ 0 | |
Aggregate Intrinsic Value | ||
Balance | $ 0 |
Stock Based Compensation - Stoc
Stock Based Compensation - Stock-based Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jan. 31, 2019 | Jan. 31, 2018 | Jan. 31, 2019 | Jan. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Total stock-based compensation expense | $ 13,227 | $ 2,064 | $ 20,813 | $ 3,797 |
Cost of revenue | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Total stock-based compensation expense | 619 | 126 | 1,122 | 235 |
Sales and marketing | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Total stock-based compensation expense | 5,517 | 985 | 8,318 | 1,770 |
Research and development | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Total stock-based compensation expense | 4,398 | 494 | 7,193 | 892 |
General and administrative | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Total stock-based compensation expense | $ 2,693 | $ 459 | $ 4,180 | $ 900 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jan. 31, 2019 | Jan. 31, 2018 | Jan. 31, 2019 | Jan. 31, 2018 | |
Income Tax Disclosure [Abstract] | ||||
Provision for income taxes | $ 547 | $ 357 | $ 874 | $ 646 |
Net Loss Per Share (Details)
Net Loss Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jan. 31, 2019 | Jan. 31, 2018 | Jan. 31, 2019 | Jan. 31, 2018 | |
Earnings Per Share [Abstract] | ||||
Net loss | $ (3,555) | $ (6,515) | $ (11,143) | $ (17,913) |
Accretion of Series C and D redeemable convertible preferred stock | 0 | (2,579) | 0 | (5,109) |
Net loss attributable to common stockholders | $ (3,555) | $ (9,094) | $ (11,143) | $ (23,022) |
Weighted-average shares used in computing net loss per share attributable to common stockholders, basic and diluted (in shares) | 122,741 | 31,434 | 121,664 | 31,125 |
Net loss per share attributable to common stockholders, basic and diluted (in dollars per share) | $ (0.03) | $ (0.29) | $ (0.09) | $ (0.74) |
Net Loss Per Share Attributab_3
Net Loss Per Share Attributable to Common Stockholders - Antidilutive Securities Excluded from Computation (Details) - shares shares in Thousands | 6 Months Ended | |
Jan. 31, 2019 | Jan. 31, 2018 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 17,178 | 88,621 |
Convertible preferred stock | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 0 | 72,501 |
Outstanding stock options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 12,028 | 14,949 |
Shares subject to repurchase from early exercised stock options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 239 | 1,171 |
Purchase rights committed under the ESPP | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 1,410 | 0 |
Unvested RSUs | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 3,037 | 0 |
Unvested performance stock units | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 464 | 0 |
Significant Customers and Geo_3
Significant Customers and Geographic Information - Schedule of Accounts Receivable (Details) - Customer Concentration Risk - Accounts Receivable | 6 Months Ended | 12 Months Ended | |
Jan. 31, 2019 | Jul. 31, 2018 | ||
Channel partner A | |||
Concentration Risk [Line Items] | |||
Accounts receivable, net | 13.00% | ||
Channel partner B | |||
Concentration Risk [Line Items] | |||
Accounts receivable, net | [1] | 13.00% | |
Channel partner C | |||
Concentration Risk [Line Items] | |||
Accounts receivable, net | [1] | 13.00% | |
[1] | less than 10% |
Significant Customers and Geo_4
Significant Customers and Geographic Information - Schedule of Long-lived Assets (Details) - USD ($) $ in Thousands | Jan. 31, 2019 | Jul. 31, 2018 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total long-lived assets | $ 27,895 | $ 19,765 |
United States | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total long-lived assets | 20,336 | 14,742 |
Rest of the world | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total long-lived assets | $ 7,559 | $ 5,023 |
Uncategorized Items - zs-201901
Label | Element | Value |
Restricted Cash and Cash Equivalents, Current | us-gaap_RestrictedCashAndCashEquivalentsAtCarryingValue | $ 180,000 |
Restricted Cash and Cash Equivalents, Current | us-gaap_RestrictedCashAndCashEquivalentsAtCarryingValue | 96,000 |
Restricted Cash and Cash Equivalents, Noncurrent | us-gaap_RestrictedCashAndCashEquivalentsNoncurrent | 388,000 |
Restricted Cash and Cash Equivalents, Noncurrent | us-gaap_RestrictedCashAndCashEquivalentsNoncurrent | $ 292,000 |