Fiscal Year Ended July 31, | |||||||||||
2016 | 2017 | 2018 | |||||||||
(in thousands) | |||||||||||
Software revenue | $ | 287,603 | $ | 436,981 | $ | 630,675 | |||||
Hardware revenue | 126,307 | 236,316 | 257,314 | ||||||||
Support, entitlements and other services revenue | 89,500 | 172,606 | 267,468 | ||||||||
Total revenue | $ | 503,410 | $ | 845,903 | $ | 1,155,457 |
Three Months Ended | |||||||||||||||||||||||||||||||
October 31, 2016 (1) | January 31, 2017 (1) | April 30, 2017 (1) | July 31, 2017 (1) | October 31, 2017 | January 31, 2018 | April 30, 2018 | July 31, 2018 | ||||||||||||||||||||||||
(unaudited, in thousands, except per share amounts) | |||||||||||||||||||||||||||||||
Revenue: | |||||||||||||||||||||||||||||||
Product | $ | 153,536 | $ | 158,213 | $ | 160,076 | $ | 201,472 | $ | 219,052 | $ | 223,170 | $ | 221,117 | $ | 224,650 | |||||||||||||||
Support, entitlements and other services | 35,025 | 41,001 | 45,594 | 50,986 | 56,500 | 63,574 | 68,296 | 79,098 | |||||||||||||||||||||||
Total revenue | 188,561 | 199,214 | 205,670 | 252,458 | 275,552 | 286,744 | 289,413 | 303,748 | |||||||||||||||||||||||
Cost of revenue: | |||||||||||||||||||||||||||||||
Product (3)(4) | 52,210 | 58,403 | 62,593 | 76,187 | 85,162 | 83,217 | 66,680 | 41,068 | |||||||||||||||||||||||
Support, entitlements and other services (3) | 17,552 | 18,443 | 20,613 | 21,330 | 23,460 | 25,311 | 28,935 | 32,197 | |||||||||||||||||||||||
Total cost of revenue | 69,762 | 76,846 | 83,206 | 97,517 | 108,622 | 108,528 | 95,615 | 73,265 | |||||||||||||||||||||||
Gross profit | 118,799 | 122,368 | 122,464 | 154,941 | 166,930 | 178,216 | 193,798 | 230,483 | |||||||||||||||||||||||
Operating expenses: | |||||||||||||||||||||||||||||||
Sales and marketing (3)(4) | 128,625 | 111,374 | 126,746 | 134,276 | 145,405 | 151,201 | 169,860 | 183,191 | |||||||||||||||||||||||
Research and development (3) | 75,281 | 70,914 | 74,607 | 67,817 | 64,512 | 70,924 | 81,291 | 97,050 | |||||||||||||||||||||||
General and administrative (3) | 29,372 | 15,481 | 15,610 | 16,878 | 16,052 | 15,948 | 24,929 | 29,472 | |||||||||||||||||||||||
Total operating expenses | 233,278 | 197,769 | 216,963 | 218,971 | 225,969 | 238,073 | 276,080 | 309,713 | |||||||||||||||||||||||
Loss from operations | (114,479 | ) | (75,401 | ) | (94,499 | ) | (64,030 | ) | (59,039 | ) | (59,857 | ) | (82,282 | ) | (79,230 | ) | |||||||||||||||
Other income (expense), net | (25,712 | ) | (421 | ) | 303 | (547 | ) | (189 | ) | (861 | ) | (4,235 | ) | (4,021 | ) | ||||||||||||||||
Loss before provision for income taxes | (140,191 | ) | (75,822 | ) | (94,196 | ) | (64,577 | ) | (59,228 | ) | (60,718 | ) | (86,517 | ) | (83,251 | ) | |||||||||||||||
Provision for income taxes | 111 | 547 | 2,639 | 1,555 | 2,259 | 1,913 | (843 | ) | 4,118 | ||||||||||||||||||||||
Net loss | $ | (140,302 | ) | $ | (76,369 | ) | $ | (96,835 | ) | $ | (66,132 | ) | $ | (61,487 | ) | $ | (62,631 | ) | $ | (85,674 | ) | $ | (87,369 | ) | |||||||
Net loss per share attributable to Class A and Class B common stockholders—basic and diluted (2) | $ | (1.89 | ) | $ | (0.54 | ) | $ | (0.67 | ) | $ | (0.43 | ) | $ | (0.39 | ) | $ | (0.39 | ) | $ | (0.51 | ) | $ | (0.51 | ) |
(1) | Adjusted to include the impact of ASC 606. Refer to Note 3 for more details on the impact of the adoption of this standard. |
(2) | Basic and diluted earnings per share are computed independently for each of the quarters presented. Therefore, the sum of quarterly basic and diluted per share amounts may not equal annual basic and diluted per share amounts. |
(3) | Includes stock-based compensation as follows: |
Three Months Ended | |||||||||||||||||||||||||||||||
October 31, 2016 | January 31, 2017 | April 30, 2017 | July 31, 2017 | October 31, 2017 | January 31, 2018 | April 30, 2018 | July 31, 2018 | ||||||||||||||||||||||||
(unaudited, in thousands) | |||||||||||||||||||||||||||||||
Product cost of sales | $ | 966 | $ | 848 | $ | 610 | $ | 642 | $ | 570 | $ | 684 | $ | 634 | $ | 692 | |||||||||||||||
Support, entitlements and other services cost of sales | 3,350 | 2,389 | 2,471 | 2,201 | 2,072 | 2,133 | 1,951 | 2,789 | |||||||||||||||||||||||
Sales and marketing | 33,891 | 15,528 | 15,726 | 12,972 | 13,766 | 15,942 | 18,051 | 17,301 | |||||||||||||||||||||||
Research and development | 34,026 | 28,759 | 27,041 | 19,218 | 15,542 | 17,023 | 16,474 | 25,350 | |||||||||||||||||||||||
General and administrative | 18,495 | 5,083 | 4,503 | 2,772 | 3,565 | 6,229 | 7,836 | 9,264 | |||||||||||||||||||||||
Total | $ | 90,728 | $ | 52,607 | $ | 50,351 | $ | 37,805 | $ | 35,515 | $ | 42,011 | $ | 44,946 | $ | 55,396 |
(4) | Includes amortization of intangible assets as follows: |
Three Months Ended | |||||||||||||||||||||||||||||||
October 31, 2016 | January 31, 2017 | April 30, 2017 | July 31, 2017 | October 31, 2017 | January 31, 2018 | April 30, 2018 | July 31, 2018 | ||||||||||||||||||||||||
(unaudited, in thousands) | |||||||||||||||||||||||||||||||
Product cost of sales | $ | 238 | $ | 360 | $ | 358 | $ | 358 | $ | 895 | $ | 1,164 | $ | 1,447 | $ | 2,135 | |||||||||||||||
Sales and marketing | 167 | 248 | 250 | 250 | 211 | 192 | 222 | 289 | |||||||||||||||||||||||
Total | $ | 405 | $ | 608 | $ | 608 | $ | 608 | $ | 1,106 | $ | 1,356 | $ | 1,669 | $ | 2,424 |
Three Months Ended | |||||||||||||||||||||||||||||||
October 31, 2016 (1) | January 31, 2017 (1) | April 30, 2017 (1) | July 31, 2017 (1) | October 31, 2017 | January 31, 2018 | April 30, 2018 | July 31, 2018 | ||||||||||||||||||||||||
(unaudited, in thousands, except per share amounts) | |||||||||||||||||||||||||||||||
Revenue: | |||||||||||||||||||||||||||||||
Product | $ | 153,536 | $ | 158,213 | $ | 160,076 | $ | 201,472 | $ | 219,052 | $ | 223,170 | $ | 221,117 | $ | 224,650 | |||||||||||||||
Support, entitlements and other services | 35,025 | 41,001 | 45,594 | 50,986 | 56,500 | 63,574 | 68,296 | 79,098 | |||||||||||||||||||||||
Total revenue | 188,561 | 199,214 | 205,670 | 252,458 | 275,552 | 286,744 | 289,413 | 303,748 | |||||||||||||||||||||||
Cost of revenue: | |||||||||||||||||||||||||||||||
Product (3)(4) | 52,210 | 58,403 | 62,593 | 76,187 | 85,162 | 83,217 | 66,680 | 41,068 | |||||||||||||||||||||||
Support, entitlements and other services (3) | 17,552 | 18,443 | 20,613 | 21,330 | 23,460 | 25,311 | 28,935 | 32,197 | |||||||||||||||||||||||
Total cost of revenue | 69,762 | 76,846 | 83,206 | 97,517 | 108,622 | 108,528 | 95,615 | 73,265 | |||||||||||||||||||||||
Gross profit | 118,799 | 122,368 | 122,464 | 154,941 | 166,930 | 178,216 | 193,798 | 230,483 | |||||||||||||||||||||||
Operating expenses: | |||||||||||||||||||||||||||||||
Sales and marketing (3)(4) | 128,625 | 111,374 | 126,746 | 134,276 | 145,405 | 151,201 | 169,860 | 183,191 | |||||||||||||||||||||||
Research and development (3) | 75,281 | 70,914 | 74,607 | 67,817 | 64,512 | 70,924 | 81,291 | 97,050 | |||||||||||||||||||||||
General and administrative (3) | 29,372 | 15,481 | 15,610 | 16,878 | 16,052 | 15,948 | 24,929 | 29,472 | |||||||||||||||||||||||
Total operating expenses | 233,278 | 197,769 | 216,963 | 218,971 | 225,969 | 238,073 | 276,080 | 309,713 | |||||||||||||||||||||||
Loss from operations | (114,479 | ) | (75,401 | ) | (94,499 | ) | (64,030 | ) | (59,039 | ) | (59,857 | ) | (82,282 | ) | (79,230 | ) | |||||||||||||||
Other income (expense), net | (25,712 | ) | (421 | ) | 303 | (547 | ) | (189 | ) | (861 | ) | (4,235 | ) | (4,021 | ) | ||||||||||||||||
Loss before provision for income taxes | (140,191 | ) | (75,822 | ) | (94,196 | ) | (64,577 | ) | (59,228 | ) | (60,718 | ) | (86,517 | ) | (83,251 | ) | |||||||||||||||
Provision for income taxes | 111 | 547 | 2,639 | 1,555 | 2,259 | 1,913 | (843 | ) | 4,118 | ||||||||||||||||||||||
Net loss | $ | (140,302 | ) | $ | (76,369 | ) | $ | (96,835 | ) | $ | (66,132 | ) | $ | (61,487 | ) | $ | (62,631 | ) | $ | (85,674 | ) | $ | (87,369 | ) | |||||||
Net loss per share attributable to Class A and Class B common stockholders—basic and diluted (2) | $ | (1.89 | ) | $ | (0.54 | ) | $ | (0.67 | ) | $ | (0.43 | ) | $ | (0.39 | ) | $ | (0.39 | ) | $ | (0.51 | ) | $ | (0.51 | ) |
(1) | Adjusted to include the impact of ASC 606. Refer to Note 3 for more details on the impact of the adoption of this standard. |
(2) | Basic and diluted earnings per share are computed independently for each of the quarters presented. Therefore, the sum of quarterly basic and diluted per share amounts may not equal annual basic and diluted per share amounts. |
(3) | Includes stock-based compensation as follows: |
Three Months Ended | |||||||||||||||||||||||||||||||
October 31, 2016 | January 31, 2017 | April 30, 2017 | July 31, 2017 | October 31, 2017 | January 31, 2018 | April 30, 2018 | July 31, 2018 | ||||||||||||||||||||||||
(unaudited, in thousands) | |||||||||||||||||||||||||||||||
Product cost of sales | $ | 966 | $ | 848 | $ | 610 | $ | 642 | $ | 570 | $ | 684 | $ | 634 | $ | 692 | |||||||||||||||
Support, entitlements and other services cost of sales | 3,350 | 2,389 | 2,471 | 2,201 | 2,072 | 2,133 | 1,951 | 2,789 | |||||||||||||||||||||||
Sales and marketing | 33,891 | 15,528 | 15,726 | 12,972 | 13,766 | 15,942 | 18,051 | 17,301 | |||||||||||||||||||||||
Research and development | 34,026 | 28,759 | 27,041 | 19,218 | 15,542 | 17,023 | 16,474 | 25,350 | |||||||||||||||||||||||
General and administrative | 18,495 | 5,083 | 4,503 | 2,772 | 3,565 | 6,229 | 7,836 | 9,264 | |||||||||||||||||||||||
Total | $ | 90,728 | $ | 52,607 | $ | 50,351 | $ | 37,805 | $ | 35,515 | $ | 42,011 | $ | 44,946 | $ | 55,396 |
(4) | Includes amortization of intangible assets as follows: |
Three Months Ended | |||||||||||||||||||||||||||||||
October 31, 2016 | January 31, 2017 | April 30, 2017 | July 31, 2017 | October 31, 2017 | January 31, 2018 | April 30, 2018 | July 31, 2018 | ||||||||||||||||||||||||
(unaudited, in thousands) | |||||||||||||||||||||||||||||||
Product cost of sales | $ | 238 | $ | 360 | $ | 358 | $ | 358 | $ | 895 | $ | 1,164 | $ | 1,447 | $ | 2,135 | |||||||||||||||
Sales and marketing | 167 | 248 | 250 | 250 | 211 | 192 | 222 | 289 | |||||||||||||||||||||||
Total | $ | 405 | $ | 608 | $ | 608 | $ | 608 | $ | 1,106 | $ | 1,356 | $ | 1,669 | $ | 2,424 |
Revenue | Accounts Receivable as of July 31, | ||||||||||||||
Fiscal Year Ended July 31, | |||||||||||||||
Partners | 2016 As Adjusted (2) | 2017 As Adjusted (2) | 2018 | 2017 | 2018 | ||||||||||
Partner A | 14 | % | (1) | 10 | % | (1) | 16 | % | |||||||
Partner B | 18 | % | 19 | % | 20 | % | 12 | % | 13 | % | |||||
Partner C | 13 | % | 16 | % | 18 | % | 14 | % | 15 | % | |||||
Partner D | 11 | % | 10 | % | (1) | 20 | % | (1) | |||||||
Partner E | 10 | % | (1) | (1) | (1) | (1) | |||||||||
Partner F | 15 | % | 14 | % | 13 | % | 18 | % | 12 | % |
(1) | Less than 10% |
(2) | Adjusted to include the impact of ASC 606. Refer to Note 3 for more details on the impact of the adoption of this standard. |
Fiscal Year Ended July 31, | |||||||||||
2016 | 2017 | 2018 | |||||||||
(in thousands) | |||||||||||
Allowance for doubtful accounts—beginning balance | $ | 410 | $ | 132 | $ | 132 | |||||
Charged to provision for doubtful accounts (credit) | (85 | ) | — | 815 | |||||||
Write-offs | (193 | ) | — | (132 | ) | ||||||
Allowance for doubtful accounts—ending balance | $ | 132 | $ | 132 | $ | 815 |
As of July 31, | |||||||
2017 | 2018 | ||||||
(in thousands) | |||||||
Goodwill | $ | 16,672 | $ | 71,087 | |||
Amortizable intangible assets | 28,230 | 25,920 | |||||
Tangible assets acquired | 2,884 | 842 | |||||
Liabilities assumed | (16,988 | ) | (11,041 | ) | |||
Total consideration | $ | 30,798 | $ | 86,808 |
Fiscal Year Ending July 31: | Amount | ||
(in thousands) | |||
2019 | $ | 26,158 | |
2020 | 23,849 | ||
2021 | 21,749 | ||
2022 | 20,739 | ||
2023 | 17,115 | ||
Thereafter | 12,718 | ||
Total | $ | 122,328 |
Amount | |||
(in thousands) | |||
Principal amount | $ | 575,000 | |
Less: initial purchasers' discount | (10,781 | ) | |
Less: cost of the bond hedges | (143,175 | ) | |
Add: proceeds from the sale of warrants | 87,975 | ||
Less: other issuance costs | (707 | ) | |
Net proceeds | $ | 508,312 |
1) | during any fiscal quarter commencing after the fiscal quarter ending on April 30, 2018 (and only during such fiscal quarter), if the last reported sale price of our Class A common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding fiscal quarter, is greater than or equal to 130% of the conversion price on each applicable trading day; |
2) | during the five business day period after any five consecutive trading day period (the \"measurement period\") in which the trading price per $1,000 principal amount of Notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of our Class A common stock and the conversion rate for the Notes on each such trading day; or |
3) | upon the occurrence of certain specified corporate events. |
As of July 31, 2018 | |||
(in thousands) | |||
Principal amounts: | |||
Principal | $ | 575,000 | |
Unamortized debt discount (1) | (137,719 | ) | |
Unamortized debt issuance costs (1) | (7,683 | ) | |
Net carrying amount | $ | 429,598 | |
Carrying amount of equity component (2) | $ | 148,598 |
(1) | Included in the consolidated balance sheets within \"Convertible senior notes, net\" and amortized over the remaining life of the Notes using the effective interest rate method. The effective interest rate is 6.62%. |
(2) | Included in the consolidated balance sheets within additional paid-in capital, net of $3.0 million in equity issuance costs. |
Fiscal Year Ended July 31, 2018 | |||
(in thousands) | |||
Interest expense related to amortization of debt discount | $ | 13,909 | |
Interest expense related to amortization of debt issuance costs | 776 | ||
Total interest expense | $ | 14,685 |
Deferred Revenue | Deferred Commissions | ||||||
(in thousands) | |||||||
Balance as of July 31, 2016 | $ | 218,481 | $ | 49,522 | |||
Additions | 317,170 | 101,152 | |||||
Revenue/commissions recognized | (172,606 | ) | (77,147 | ) | |||
Assumed in a business combination | 6,011 | — | |||||
Balance as of July 31, 2017 (1) | 369,056 | 73,527 | |||||
Additions | 529,495 | 150,122 | |||||
Revenue/commissions recognized | (267,468 | ) | (109,270 | ) | |||
Assumed in a business combination | 124 | — | |||||
Balance as of July 31, 2018 | $ | 631,207 | $ | 114,379 |
(1) | See details above for a summary of adjustments to deferred commissions and deferred revenue as a result of the adoption of ASC 606. |
Fiscal Year Ended July 31, | |||||||||||||
2017 | 2018 | ||||||||||||
Number of Shares | Grant Date Fair Value per Share | Number of Shares | Grant Date Fair Value per Share | ||||||||||
Outstanding at beginning of period | 12,265,369 | $ | 13.23 | 17,376,090 | $ | 18.85 | |||||||
Granted | 12,986,597 | $ | 21.84 | 14,947,403 | $ | 39.44 | |||||||
Released | (6,146,169 | ) | $ | 15.63 | (5,823,800 | ) | $ | 19.96 | |||||
Canceled/forfeited | (1,729,707 | ) | $ | 13.57 | (2,902,194 | ) | $ | 22.34 | |||||
Outstanding at end of period | 17,376,090 | $ | 18.85 | 23,597,499 | $ | 31.20 |
Fiscal Year Ended July 31, | ||||||||||||||||||||||||||
2017 | 2018 | |||||||||||||||||||||||||
Number of Shares | Weighted Average Exercise Price | Weighted Average Remaining Contractual Life | Aggregate Intrinsic Value | Number of Shares | Weighted Average Exercise Price | Weighted Average Remaining Contractual Life | Aggregate Intrinsic Value | |||||||||||||||||||
(in years) | (in thousands) | (in years) | (in thousands) | |||||||||||||||||||||||
Outstanding at beginning of period | 26,166,968 | (1) | $ | 4.39 | 7.5 | $ | 208,101 | 20,334,531 | $ | 4.59 | 6.4 | $ | 338,787 | |||||||||||||
Options granted | 1,047,950 | $ | 12.14 | — | $ | — | ||||||||||||||||||||
Options exercised | (4,786,381 | ) | $ | 3.27 | (8,672,623 | ) | $ | 3.81 | ||||||||||||||||||
Options canceled/forfeited | (2,094,006 | ) | $ | 8.89 | (329,354 | ) | $ | 6.63 | ||||||||||||||||||
Outstanding at end of period | 20,334,531 | $ | 4.59 | 6.4 | $ | 338,787 | 11,332,554 | $ | 5.12 | 5.6 | $ | 496,022 | ||||||||||||||
Exercisable at end of period | 19,645,676 | $ | 4.43 | 6.3 | $ | 330,486 | 11,159,045 | $ | 5.01 | 5.5 | $ | 489,682 | ||||||||||||||
Vested and expected to vest at end of period | 20,334,531 | $ | 4.59 | 6.4 | $ | 338,787 | 11,332,554 | $ | 5.12 | 5.6 | $ | 496,022 |
(1) | Includes 455,000 stock options with both service and performance conditions with a weighted average fair value per share of $3.78 (the \"Performance Stock Options\"). Vesting of the Performance Stock Options was subject to continuous service with us (the \"service condition\") and satisfaction of certain liquidity events (the \"performance condition\"). We recognized cumulative stock-based compensation expense related to the Performance Stock Options in the first quarter of fiscal 2017, as the performance condition was met upon the successful completion of our IPO. The cumulative stock-based compensation expense recorded in the first quarter of fiscal 2017 was for the portion of the awards for which the relevant service condition had been satisfied and the remaining expense is being recognized over the remaining service period. |
Fiscal Year Ended July 31, | |||||
2017 | 2018 | ||||
Expected term (in years) | 0.75 | 0.75 | |||
Risk-free interest rate | 0.6 | % | 1.4 | % | |
Volatility | 51.0 | % | 49.8 | % | |
Dividend yield | — | % | — | % |
Fiscal Year Ended July 31, | |||||||||||
2016 | 2017 | 2018 | |||||||||
(in thousands) | |||||||||||
Cost of revenue: | |||||||||||
Product | $ | 391 | $ | 3,066 | $ | 2,580 | |||||
Support, entitlements and other services | 968 | 10,411 | 8,945 | ||||||||
Sales and marketing | 8,006 | 78,117 | 65,060 | ||||||||
Research and development | 6,259 | 109,044 | 74,389 | ||||||||
General and administrative | 4,432 | 30,853 | 26,894 | ||||||||
Total stock-based compensation expense | $ | 20,056 | $ | 231,491 | $ | 177,868 |
Fiscal Year Ended July 31, | |||||||
2016 | 2017 | ||||||
Fair value of common stock | $ | 14.81 | $ | 12.14 | |||
Expected term (in years) | 6.1 | 6.1 | |||||
Risk-free interest rate | 1.6 | % | 1.3 | % | |||
Volatility | 42 | % | 52 | % | |||
Dividend yield | — | % | — | % |
Fiscal Year Ended July 31, | |||||||||||
2016 As Adjusted (1) | 2017 As Adjusted (1) | 2018 | |||||||||
(in thousands, except share and per share data) | |||||||||||
Numerator: | |||||||||||
Net loss | $ | (108,233 | ) | $ | (379,638 | ) | $ | (297,161 | ) | ||
Denominator: | |||||||||||
Weighted average shares—basic and diluted | 43,970,381 | 128,295,563 | 164,091,302 | ||||||||
Net loss per share—basic and diluted | $ | (2.46 | ) | $ | (2.96 | ) | $ | (1.81 | ) |
(1) | Adjusted to include the impact of ASC 606. Refer to Note 3 for more details on the impact of the adoption of this standard. |
As of July 31, | ||||||||
2016 | 2017 | 2018 | ||||||
Convertible preferred stock | 76,319,511 | — | — | |||||
Outstanding stock options and RSUs | 38,432,337 | 37,710,621 | 34,930,053 | |||||
Employee stock purchase plan | — | 1,447,385 | 1,310,653 | |||||
Common stock subject to repurchase | 954,215 | 243,148 | 47,691 | |||||
Contingently issuable shares pursuant to a business combination | — | — | 276,625 | |||||
Common stock warrants | 824,094 | 34,180 | 34,180 | |||||
Total | 116,530,157 | 39,435,334 | 36,599,202 |
• | Level I — Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date; |
• | Level II — Inputs are observable, unadjusted quoted prices in active markets for similar assets or liabilities, unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities; and |
• | Level III — Unobservable inputs that are significant to the measurement of the fair value of the assets or liabilities that are supported by little or no market data. |
As of July 31, 2017 | |||||||||||||||
Level I | Level II | Level III | Total | ||||||||||||
(in thousands) | |||||||||||||||
Financial Assets: | |||||||||||||||
Cash equivalents: | |||||||||||||||
Money market funds | $ | 34,784 | $ | — | $ | — | $ | 34,784 | |||||||
Commercial paper | — | 23,041 | — | 23,041 | |||||||||||
Short-term investments: | |||||||||||||||
Corporate bonds | — | 160,634 | — | 160,634 | |||||||||||
Commercial paper | — | 36,084 | — | 36,084 | |||||||||||
U.S. government securities | — | 13,976 | — | 13,976 | |||||||||||
Total measured at fair value | $ | 34,784 | $ | 233,735 | $ | — | $ | 268,519 | |||||||
Cash | 80,534 | ||||||||||||||
Total cash, cash equivalents and short-term investments | $ | 349,053 | |||||||||||||
Financial Liabilities: | |||||||||||||||
Contingent consideration | $ | — | $ | — | $ | 4,295 | $ | 4,295 |
As of July 31, 2018 | |||||||||||||||
Level I | Level II | Level III | Total | ||||||||||||
(in thousands) | |||||||||||||||
Financial Assets: | |||||||||||||||
Cash equivalents: | |||||||||||||||
Money market funds | $ | 41,763 | $ | — | $ | — | $ | 41,763 | |||||||
Commercial paper | — | 77,818 | — | 77,818 | |||||||||||
U.S. government securities | — | 4,985 | — | 4,985 | |||||||||||
Short-term investments: | |||||||||||||||
Corporate bonds | — | 448,458 | — | 448,458 | |||||||||||
Commercial paper | — | 120,772 | — | 120,772 | |||||||||||
U.S. government securities | — | 59,098 | — | 59,098 | |||||||||||
Total measured at fair value | 41,763 | 711,131 | — | 752,894 | |||||||||||
Cash | 181,409 | ||||||||||||||
Total cash, cash equivalents and short-term investments | $ | 934,303 | |||||||||||||
Financial Liabilities: | |||||||||||||||
Contingent consideration | $ | — | $ | — | $ | 1,872 | $ | 1,872 |
As of July 31, 2017 | As of July 31, 2018 | ||||||||||||||
Carrying Value | Estimated Fair Value | Carrying Value | Estimated Fair Value | ||||||||||||
(in thousands) | |||||||||||||||
Convertible senior notes, net | $ | — | $ | — | $ | 429,598 | $ | 685,527 |
Fiscal Year Ended July 31, | |||||||
2017 | 2018 | ||||||
(in thousands) | |||||||
Contingent consideration—beginning balance | $ | — | $ | 4,295 | |||
Assumed in a business combination | 2,371 | — | |||||
Change in fair value (1) | 1,924 | (2,423 | ) | ||||
Contingent consideration—ending balance | $ | 4,295 | $ | 1,872 |
(1) | Recognized in the consolidated statements of operations within general and administrative expenses. |
Fiscal Year Ended July 31, | |||||||
2017 | 2018 | ||||||
(in thousands) | |||||||
Contingent consideration—beginning balance | $ | — | $ | 4,295 | |||
Assumed in a business combination | 2,371 | — | |||||
Change in fair value (1) | 1,924 | (2,423 | ) | ||||
Contingent consideration—ending balance | $ | 4,295 | $ | 1,872 |
(1) | Recognized in the consolidated statements of operations within general and administrative expenses. |
Fiscal Year Ended July 31, | |||||||||||
2016 As Adjusted (1) | 2017 As Adjusted (1) | 2018 | |||||||||
(in thousands) | |||||||||||
Domestic | $ | (67,776 | ) | $ | (304,363 | ) | $ | (201,666 | ) | ||
Foreign | (38,140 | ) | (70,423 | ) | (88,048 | ) | |||||
Loss before provision for income taxes | $ | (105,916 | ) | $ | (374,786 | ) | $ | (289,714 | ) |
(1) | Adjusted to include the impact of ASC 606. Refer to Note 3 for more details on the impact of the adoption of this standard. |
Fiscal Year Ended July 31, | |||||||||||
2016 As Adjusted (1) | 2017 As Adjusted (1) | 2018 | |||||||||
(in thousands) | |||||||||||
Current: | |||||||||||
U.S. federal | $ | — | $ | — | $ | 2,059 | |||||
State and local | 140 | 193 | 429 | ||||||||
Foreign | 3,172 | 8,196 | 8,541 | ||||||||
Total current taxes | 3,312 | 8,389 | 11,029 | ||||||||
Deferred: | |||||||||||
U.S. federal | — | (1,342 | ) | (3,387 | ) | ||||||
State and local | — | 13 | (718 | ) | |||||||
Foreign | (995 | ) | (2,208 | ) | 523 | ||||||
Total deferred taxes | (995 | ) | (3,537 | ) | (3,582 | ) | |||||
Provision for income taxes | $ | 2,317 | $ | 4,852 | $ | 7,447 |
(1) | Adjusted to include the impact of ASC 606. Refer to Note 3 for more details on the impact of the adoption of this standard. |
Fiscal Year Ended July 31, | |||||||||||
2016 As Adjusted (1) | 2017 As Adjusted (1) | 2018 | |||||||||
(in thousands) | |||||||||||
U.S. tax reform impact | $ | — | $ | — | $ | 93,352 | |||||
U.S. federal income tax at statutory rate | (36,011 | ) | (127,427 | ) | (75,779 | ) | |||||
Stock-based compensation | 3,655 | 6,701 | (73,631 | ) | |||||||
Effect of foreign operations | 15,144 | 16,891 | 26,117 | ||||||||
Change in valuation allowance | 19,268 | 86,941 | 25,274 | ||||||||
Transfer pricing adjustments | — | 11,822 | 4,584 | ||||||||
Intangible asset migration | — | — | 4,461 | ||||||||
Non-deductible expenses | 802 | 1,693 | 2,115 | ||||||||
State income taxes | 140 | 206 | (290 | ) | |||||||
Warrant revaluation | (681 | ) | 7,185 | — | |||||||
Other | — | 840 | 1,244 | ||||||||
Total | $ | 2,317 | $ | 4,852 | $ | 7,447 |
(1) | Adjusted to include the impact of ASC 606. Refer to Note 3 for more details on the impact of the adoption of this standard. |
As of July 31, | |||||||
2017 As Adjusted (1) | 2018 | ||||||
(in thousands) | |||||||
Deferred tax assets: | |||||||
Net operating loss carryforward | $ | 135,929 | $ | 162,914 | |||
Tax credit carryforward | 13,100 | 47,839 | |||||
Deferred revenue | 2,378 | 27,577 | |||||
Stock-based compensation expense | 27,512 | 21,252 | |||||
Accruals and reserves | 7,427 | 8,370 | |||||
Property and equipment | 1,118 | — | |||||
Total deferred tax assets | 187,464 | 267,952 | |||||
Deferred tax liabilities: | |||||||
Deferred commission expense | (22,535 | ) | (27,829 | ) | |||
Goodwill and intangible assets | (483 | ) | (5,909 | ) | |||
Property and equipment | — | (3,870 | ) | ||||
Other | (75 | ) | (497 | ) | |||
Total deferred tax liabilities | (23,093 | ) | (38,105 | ) | |||
Valuation allowance | (161,195 | ) | (226,987 | ) | |||
Net deferred tax assets | $ | 3,176 | $ | 2,860 |
(1) | Adjusted to include the impact of ASC 606. Refer to Note 3 for more details on the impact of the adoption of this standard. |
Fiscal Year Ended July 31, | |||||||
2017 | 2018 | ||||||
(in thousands) | |||||||
Balance at the beginning of the year | $ | 19,711 | $ | 42,655 | |||
Increases related to current year tax positions | 22,571 | 58,727 | |||||
Increases related to prior year tax positions | 373 | 4,893 | |||||
Decreases related to prior year tax positions | — | (14,559 | ) | ||||
Balance at the end of the year | $ | 42,655 | $ | 91,716 |
Fiscal Year Ended July 31, 2018 | |||
(in thousands) | |||
Interest expense related to amortization of debt discount | $ | 13,909 | |
Interest expense related to amortization of debt issuance costs | 776 | ||
Total interest expense | $ | 14,685 |
As of July 31, 2018 | |||
(in thousands) | |||
Due within one year | $ | 463,940 | |
Due in one year through three years | 164,388 | ||
Total | $ | 628,328 |
Fiscal Year Ending July 31: | Amount | ||
(in thousands) | |||
2019 | $ | 26,158 | |
2020 | 23,849 | ||
2021 | 21,749 | ||
2022 | 20,739 | ||
2023 | 17,115 | ||
Thereafter | 12,718 | ||
Total | $ | 122,328 |
Estimated Useful Life | As of July 31, | ||||||||
2017 | 2018 | ||||||||
(in months) | (in thousands) | ||||||||
Computer, production, engineering, and other equipment | 36 | $ | 85,280 | $ | 131,805 | ||||
Demonstration units | 12 | 46,387 | 53,547 | ||||||
Leasehold improvements | (1) | 10,562 | 19,916 | ||||||
Furniture and fixtures | 60 | 4,744 | 7,636 | ||||||
Total property and equipment, gross | 146,973 | 212,904 | |||||||
Less: Accumulated depreciation and amortization | (88,901 | ) | (127,793 | ) | |||||
Total property and equipment, net | $ | 58,072 | $ | 85,111 |
(1) | Leasehold improvements are amortized over the shorter of the estimated useful lives of the improvements or the remaining lease term. |
As of July 31, 2017 | |||||||||||
As Previously Reported | Impact of Adoption | As Adjusted | |||||||||
(in thousands) | |||||||||||
Assets | |||||||||||
Deferred commissions—current | $ | 27,679 | $ | (3,836 | ) | (1) | $ | 23,843 | |||
Deferred commissions—non-current | 33,709 | 15,975 | (1) | 49,684 | |||||||
Total deferred commissions | $ | 61,388 | $ | 12,139 | $ | 73,527 | |||||
Liabilities | |||||||||||
Deferred revenue—current | $ | 233,498 | $ | (63,375 | ) | (2) | $ | 170,123 | |||
Deferred revenue—non-current | 292,573 | (93,640 | ) | (2) | 198,933 | ||||||
Total deferred revenue | $ | 526,071 | $ | (157,015 | ) | $ | 369,056 | ||||
Accrued expenses and other current liabilities | $ | 9,414 | $ | 293 | (3) | $ | 9,707 | ||||
Stockholders' Equity | $ | 48,202 | $ | 168,861 | $ | 217,063 |
(1) | Impact of cumulative change in commissions expense |
(2) | Impact of cumulative change in revenue |
(3) | Impact of cumulative change in provision for income taxes |
Fiscal Year Ended July 31, 2016 | |||||||||||
As Previously Reported | Impact of Adoption | As Adjusted | |||||||||
(in thousands, except per share data) | |||||||||||
Revenue | |||||||||||
Product | $ | 350,798 | $ | 63,112 | $ | 413,910 | |||||
Support, entitlements and other services | 94,130 | (4,630 | ) | 89,500 | |||||||
Total revenue | $ | 444,928 | $ | 58,482 | $ | 503,410 | |||||
Gross profit | $ | 274,141 | $ | 58,482 | $ | 332,623 | |||||
Operating expenses | |||||||||||
Sales and marketing expenses | $ | 288,493 | $ | (1,909 | ) | $ | 286,584 | ||||
Loss from operations | $ | (165,017 | ) | $ | 60,391 | $ | (104,626 | ) | |||
Net loss | $ | (168,499 | ) | $ | 60,266 | $ | (108,233 | ) | |||
Basic and diluted net loss per share | $ | (3.83 | ) | $ | 1.37 | $ | (2.46 | ) |
Fiscal Year Ended July 31, 2017 | |||||||||||
As Previously Reported | Impact of Adoption | As Adjusted | |||||||||
(in thousands, except per share data) | |||||||||||
Revenue | |||||||||||
Product | $ | 583,011 | $ | 90,286 | $ | 673,297 | |||||
Support, entitlements and other services | 183,858 | (11,252 | ) | 172,606 | |||||||
Total revenue | $ | 766,869 | $ | 79,034 | $ | 845,903 | |||||
Gross profit | $ | 439,538 | $ | 79,034 | $ | 518,572 | |||||
Operating expenses | |||||||||||
Sales and marketing expenses | $ | 500,529 | $ | 492 | $ | 501,021 | |||||
Loss from operations | $ | (426,951 | ) | $ | 78,542 | $ | (348,409 | ) | |||
Net loss | $ | (458,011 | ) | $ | 78,373 | $ | (379,638 | ) | |||
Basic and diluted net loss per share | $ | (3.57 | ) | $ | 0.61 | $ | (2.96 | ) |
Fiscal Year Ended July 31, 2016 | |||||||||||
As Previously Reported | Impact of Adoption | As Adjusted | |||||||||
(in thousands) | |||||||||||
U.S. | $ | 280,800 | $ | 38,496 | $ | 319,296 | |||||
Europe, the Middle East and Africa | 81,320 | (15,721 | ) | 65,599 | |||||||
Asia Pacific | 63,610 | 33,113 | 96,723 | ||||||||
Other Americas | 19,198 | 2,594 | 21,792 | ||||||||
Total revenue | $ | 444,928 | $ | 58,482 | $ | 503,410 |
Fiscal Year Ended July 31, 2017 | |||||||||||
As Previously Reported | Impact of Adoption | As Adjusted | |||||||||
(in thousands) | |||||||||||
U.S. | $ | 462,770 | $ | 25,309 | $ | 488,079 | |||||
Europe, the Middle East and Africa | 139,170 | (355 | ) | 138,815 | |||||||
Asia Pacific | 131,921 | 54,943 | 186,864 | ||||||||
Other Americas | 33,008 | (863 | ) | 32,145 | |||||||
Total revenue | $ | 766,869 | $ | 79,034 | $ | 845,903 |
Fiscal Year Ended July 31, 2016 | |||||||||||
As Previously Reported | Impact of Adoption | As Adjusted | |||||||||
(in thousands) | |||||||||||
Cash flows from operating activities: | |||||||||||
Net loss | $ | (168,499 | ) | $ | 60,266 | $ | (108,233 | ) | |||
Adjustments to reconcile net loss to net cash provided by operating activities: | |||||||||||
Deferred commissions | $ | (19,813 | ) | $ | (1,911 | ) | $ | (21,724 | ) | ||
Accrued expenses and other liabilities | $ | (1,336 | ) | $ | 127 | $ | (1,209 | ) | |||
Deferred revenue | $ | 192,867 | $ | (58,482 | ) | $ | 134,385 |
Fiscal Year Ended July 31, 2017 | |||||||||||
As Previously Reported | Impact of Adoption | As Adjusted | |||||||||
(in thousands) | |||||||||||
Cash flows from operating activities: | |||||||||||
Net loss | $ | (458,011 | ) | $ | 78,373 | $ | (379,638 | ) | |||
Adjustments to reconcile net loss to net cash provided by operating activities: | |||||||||||
Deferred commissions | $ | (24,495 | ) | $ | 489 | $ | (24,006 | ) | |||
Accrued expenses and other liabilities | $ | 4,944 | $ | 172 | $ | 5,116 | |||||
Deferred revenue | $ | 223,598 | $ | (79,034 | ) | $ | 144,564 |
• | Identification of the contract, or contracts, with a customer — A contract with a customer exists when (i) we enter into an enforceable contract with a customer that defines each party’s rights regarding the goods or services to be transferred and identifies the payment terms related to these goods or services, (ii) the contract has commercial substance and (iii) we determine that collection of substantially all consideration for goods or services that are transferred is probable based on the customer’s intent and ability to pay the promised consideration. We apply judgment in determining the customer’s ability and intention to pay, which is based on a variety of factors, including the customer’s historical payment experience or, in the case of a new customer, published credit and financial information pertaining to the customer. |
• | Identification of the performance obligations in the contract — Performance obligations promised in a contract are identified based on the goods or services that will be transferred to the customer that are both capable of being distinct, whereby the customer can benefit from the goods or services either on their own or together with other resources that are readily available from third parties or from us, and are distinct in the context of the contract, whereby the transfer of the goods or services is separately identifiable from other promises in the contract. To the extent a contract includes multiple promised goods or services, we apply judgment to determine whether promised goods or services are capable of being distinct and distinct in the context of the contract. If these criteria are not met, the promised goods or services are accounted for as a combined performance obligation. |
• | Determination of the transaction price — The transaction price is determined based on the consideration to which we will be entitled in exchange for transferring goods or services to the customer. |
• | Allocation of the transaction price to the performance obligations in the contract — If the contract contains a single performance obligation, the entire transaction price is allocated to the single performance obligation. Contracts that contain multiple performance obligations require an allocation of the transaction price to each performance obligation based on a relative standalone selling price (\"SSP\"). We determine SSP based on the price at which the performance obligation is sold separately. If the SSP is not observable through past transactions, we estimate the SSP, taking into account available information such as market conditions and internally approved pricing guidelines related to the performance obligations. |
• | Recognition of revenue when, or as, performance obligations are satisfied — We satisfy performance obligations either over time or at a point in time, as discussed in further detail below. Revenue is recognized at the time the related performance obligation is satisfied with the transfer of a promised good or service to a customer. |
Fiscal Year Ended July 31, | |||||||||||
2016 | 2017 | 2018 | |||||||||
(in thousands) | |||||||||||
Software revenue | $ | 287,603 | $ | 436,981 | $ | 630,675 | |||||
Hardware revenue | 126,307 | 236,316 | 257,314 | ||||||||
Support, entitlements and other services revenue | 89,500 | 172,606 | 267,468 | ||||||||
Total revenue | $ | 503,410 | $ | 845,903 | $ | 1,155,457 |
Deferred Revenue | Deferred Commissions | ||||||
(in thousands) | |||||||
Balance as of July 31, 2016 | $ | 218,481 | $ | 49,522 | |||
Additions | 317,170 | 101,152 | |||||
Revenue/commissions recognized | (172,606 | ) | (77,147 | ) | |||
Assumed in a business combination | 6,011 | — | |||||
Balance as of July 31, 2017 (1) | 369,056 | 73,527 | |||||
Additions | 529,495 | 150,122 | |||||
Revenue/commissions recognized | (267,468 | ) | (109,270 | ) | |||
Assumed in a business combination | 124 | — | |||||
Balance as of July 31, 2018 | $ | 631,207 | $ | 114,379 |
(1) | See details above for a summary of adjustments to deferred commissions and deferred revenue as a result of the adoption of ASC 606. |
Fiscal Year Ended July 31, | |||||||||||
2016 As Adjusted (1) | 2017 As Adjusted (1) | 2018 | |||||||||
(in thousands) | |||||||||||
U.S. | $ | 319,296 | $ | 488,079 | $ | 648,805 | |||||
Europe, the Middle East and Africa | 65,599 | 138,815 | 224,392 | ||||||||
Asia Pacific | 96,723 | 186,864 | 240,247 | ||||||||
Other Americas | 21,792 | 32,145 | 42,013 | ||||||||
Total revenue | $ | 503,410 | $ | 845,903 | $ | 1,155,457 |
(1) | Adjusted to include the impact of ASC 606. Refer to Note 3 for more details on the impact of the adoption of this standard. |
Fiscal Year Ended July 31, | |||||||||||
2016 | 2017 | 2018 | |||||||||
(in thousands) | |||||||||||
Allowance for doubtful accounts—beginning balance | $ | 410 | $ | 132 | $ | 132 | |||||
Charged to provision for doubtful accounts (credit) | (85 | ) | — | 815 | |||||||
Write-offs | (193 | ) | — | (132 | ) | ||||||
Allowance for doubtful accounts—ending balance | $ | 132 | $ | 132 | $ | 815 |
As of July 31, | |||||||
2017 | 2018 | ||||||
(in thousands) | |||||||
Contributions to ESPP withheld | $ | 14,371 | $ | 21,931 | |||
Accrued commissions | 20,388 | 21,660 | |||||
Accrued bonus | 7,342 | 12,129 | |||||
Accrued vacation | 6,286 | 10,548 | |||||
Payroll taxes payable | 3,434 | 9,563 | |||||
Other | 5,700 | 9,567 | |||||
Total accrued compensation and benefits | $ | 57,521 | $ | 85,398 |
As of July 31, | |||||||
2017 | 2018 | ||||||
(in thousands) | |||||||
Income taxes payable (1)(2) | $ | 3,873 | $ | 20,863 | |||
Accrued professional services | 4,167 | 5,838 | |||||
Other | 1,667 | 4,981 | |||||
Total accrued expenses and other current liabilities | $ | 9,707 | $ | 31,682 |
(1) | Balance as of July 31, 2017 was adjusted to reflect the impact of the adoption of ASC 606 on income taxes. See Note 3 for a summary of adjustments. |
(2) | The increase in income taxes payable during the fiscal year ended July 31, 2018 was due primarily to a payable related to the alternative minimum tax associated with the migration of certain intangible assets. For additional details, refer to Note 11. |
As of July 31, | ||||||||
2016 | 2017 | 2018 | ||||||
Convertible preferred stock | 76,319,511 | — | — | |||||
Outstanding stock options and RSUs | 38,432,337 | 37,710,621 | 34,930,053 | |||||
Employee stock purchase plan | — | 1,447,385 | 1,310,653 | |||||
Common stock subject to repurchase | 954,215 | 243,148 | 47,691 | |||||
Contingently issuable shares pursuant to a business combination | — | — | 276,625 | |||||
Common stock warrants | 824,094 | 34,180 | 34,180 | |||||
Total | 116,530,157 | 39,435,334 | 36,599,202 |
Fiscal Year Ended July 31, | |||||||||||
2016 As Adjusted (1) | 2017 As Adjusted (1) | 2018 | |||||||||
(in thousands) | |||||||||||
Current: | |||||||||||
U.S. federal | $ | — | $ | — | $ | 2,059 | |||||
State and local | 140 | 193 | 429 | ||||||||
Foreign | 3,172 | 8,196 | 8,541 | ||||||||
Total current taxes | 3,312 | 8,389 | 11,029 | ||||||||
Deferred: | |||||||||||
U.S. federal | — | (1,342 | ) | (3,387 | ) | ||||||
State and local | — | 13 | (718 | ) | |||||||
Foreign | (995 | ) | (2,208 | ) | 523 | ||||||
Total deferred taxes | (995 | ) | (3,537 | ) | (3,582 | ) | |||||
Provision for income taxes | $ | 2,317 | $ | 4,852 | $ | 7,447 |
(1) | Adjusted to include the impact of ASC 606. Refer to Note 3 for more details on the impact of the adoption of this standard. |
Amount | |||
(in thousands) | |||
Principal amount | $ | 575,000 | |
Less: initial purchasers' discount | (10,781 | ) | |
Less: cost of the bond hedges | (143,175 | ) | |
Add: proceeds from the sale of warrants | 87,975 | ||
Less: other issuance costs | (707 | ) | |
Net proceeds | $ | 508,312 |
As of July 31, 2018 | |||
(in thousands) | |||
Principal amounts: | |||
Principal | $ | 575,000 | |
Unamortized debt discount (1) | (137,719 | ) | |
Unamortized debt issuance costs (1) | (7,683 | ) | |
Net carrying amount | $ | 429,598 | |
Carrying amount of equity component (2) | $ | 148,598 |
(1) | Included in the consolidated balance sheets within \"Convertible senior notes, net\" and amortized over the remaining life of the Notes using the effective interest rate method. The effective interest rate is 6.62%. |
(2) | Included in the consolidated balance sheets within additional paid-in capital, net of $3.0 million in equity issuance costs. |
As of July 31, | |||||||
2017 As Adjusted (1) | 2018 | ||||||
(in thousands) | |||||||
Deferred tax assets: | |||||||
Net operating loss carryforward | $ | 135,929 | $ | 162,914 | |||
Tax credit carryforward | 13,100 | 47,839 | |||||
Deferred revenue | 2,378 | 27,577 | |||||
Stock-based compensation expense | 27,512 | 21,252 | |||||
Accruals and reserves | 7,427 | 8,370 | |||||
Property and equipment | 1,118 | — | |||||
Total deferred tax assets | 187,464 | 267,952 | |||||
Deferred tax liabilities: | |||||||
Deferred commission expense | (22,535 | ) | (27,829 | ) | |||
Goodwill and intangible assets | (483 | ) | (5,909 | ) | |||
Property and equipment | — | (3,870 | ) | ||||
Other | (75 | ) | (497 | ) | |||
Total deferred tax liabilities | (23,093 | ) | (38,105 | ) | |||
Valuation allowance | (161,195 | ) | (226,987 | ) | |||
Net deferred tax assets | $ | 3,176 | $ | 2,860 |
Fiscal Year Ended July 31, | |||||||||||
2016 As Adjusted (1) | 2017 As Adjusted (1) | 2018 | |||||||||
(in thousands, except share and per share data) | |||||||||||
Numerator: | |||||||||||
Net loss | $ | (108,233 | ) | $ | (379,638 | ) | $ | (297,161 | ) | ||
Denominator: | |||||||||||
Weighted average shares—basic and diluted | 43,970,381 | 128,295,563 | 164,091,302 | ||||||||
Net loss per share—basic and diluted | $ | (2.46 | ) | $ | (2.96 | ) | $ | (1.81 | ) |
(1) | Adjusted to include the impact of ASC 606. Refer to Note 3 for more details on the impact of the adoption of this standard. |
Fiscal Year Ended July 31, | |||||||||||
2016 As Adjusted (1) | 2017 As Adjusted (1) | 2018 | |||||||||
(in thousands) | |||||||||||
U.S. tax reform impact | $ | — | $ | — | $ | 93,352 | |||||
U.S. federal income tax at statutory rate | (36,011 | ) | (127,427 | ) | (75,779 | ) | |||||
Stock-based compensation | 3,655 | 6,701 | (73,631 | ) | |||||||
Effect of foreign operations | 15,144 | 16,891 | 26,117 | ||||||||
Change in valuation allowance | 19,268 | 86,941 | 25,274 | ||||||||
Transfer pricing adjustments | — | 11,822 | 4,584 | ||||||||
Intangible asset migration | — | — | 4,461 | ||||||||
Non-deductible expenses | 802 | 1,693 | 2,115 | ||||||||
State income taxes | 140 | 206 | (290 | ) | |||||||
Warrant revaluation | (681 | ) | 7,185 | — | |||||||
Other | — | 840 | 1,244 | ||||||||
Total | $ | 2,317 | $ | 4,852 | $ | 7,447 |
(1) | Adjusted to include the impact of ASC 606. Refer to Note 3 for more details on the impact of the adoption of this standard. |
Fiscal Year Ended July 31, | |||||||||||
2016 | 2017 | 2018 | |||||||||
(in thousands) | |||||||||||
Cost of revenue: | |||||||||||
Product | $ | 391 | $ | 3,066 | $ | 2,580 | |||||
Support, entitlements and other services | 968 | 10,411 | 8,945 | ||||||||
Sales and marketing | 8,006 | 78,117 | 65,060 | ||||||||
Research and development | 6,259 | 109,044 | 74,389 | ||||||||
General and administrative | 4,432 | 30,853 | 26,894 | ||||||||
Total stock-based compensation expense | $ | 20,056 | $ | 231,491 | $ | 177,868 |
As of July 31, 2017 | |||||||||||||||
Level I | Level II | Level III | Total | ||||||||||||
(in thousands) | |||||||||||||||
Financial Assets: | |||||||||||||||
Cash equivalents: | |||||||||||||||
Money market funds | $ | 34,784 | $ | — | $ | — | $ | 34,784 | |||||||
Commercial paper | — | 23,041 | — | 23,041 | |||||||||||
Short-term investments: | |||||||||||||||
Corporate bonds | — | 160,634 | — | 160,634 | |||||||||||
Commercial paper | — | 36,084 | — | 36,084 | |||||||||||
U.S. government securities | — | 13,976 | — | 13,976 | |||||||||||
Total measured at fair value | $ | 34,784 | $ | 233,735 | $ | — | $ | 268,519 | |||||||
Cash | 80,534 | ||||||||||||||
Total cash, cash equivalents and short-term investments | $ | 349,053 | |||||||||||||
Financial Liabilities: | |||||||||||||||
Contingent consideration | $ | — | $ | — | $ | 4,295 | $ | 4,295 |
As of July 31, 2018 | |||||||||||||||
Level I | Level II | Level III | Total | ||||||||||||
(in thousands) | |||||||||||||||
Financial Assets: | |||||||||||||||
Cash equivalents: | |||||||||||||||
Money market funds | $ | 41,763 | $ | — | $ | — | $ | 41,763 | |||||||
Commercial paper | — | 77,818 | — | 77,818 | |||||||||||
U.S. government securities | — | 4,985 | — | 4,985 | |||||||||||
Short-term investments: | |||||||||||||||
Corporate bonds | — | 448,458 | — | 448,458 | |||||||||||
Commercial paper | — | 120,772 | — | 120,772 | |||||||||||
U.S. government securities | — | 59,098 | — | 59,098 | |||||||||||
Total measured at fair value | 41,763 | 711,131 | — | 752,894 | |||||||||||
Cash | 181,409 | ||||||||||||||
Total cash, cash equivalents and short-term investments | $ | 934,303 | |||||||||||||
Financial Liabilities: | |||||||||||||||
Contingent consideration | $ | — | $ | — | $ | 1,872 | $ | 1,872 |
As of July 31, 2017 | As of July 31, 2018 | ||||||||||||||
Carrying Value | Estimated Fair Value | Carrying Value | Estimated Fair Value | ||||||||||||
(in thousands) | |||||||||||||||
Convertible senior notes, net | $ | — | $ | — | $ | 429,598 | $ | 685,527 |
As of July 31, | |||||||
2017 | 2018 | ||||||
(in thousands) | |||||||
Indefinite-lived intangible asset: | |||||||
In-process R&D (1) | $ | 16,100 | $ | — | |||
Finite-lived intangible assets: | |||||||
Developed technology (1) | 7,300 | 47,500 | |||||
Customer relationships | 4,830 | 6,650 | |||||
Total finite-lived intangible assets, gross | 12,130 | 54,150 | |||||
Total intangible assets, gross | 28,230 | 54,150 | |||||
Less: | |||||||
Accumulated amortization of developed technology | (1,314 | ) | (6,956 | ) | |||
Accumulated amortization of customer relationships | (915 | ) | (1,828 | ) | |||
Total accumulated amortization | (2,229 | ) | (8,784 | ) | |||
Intangible assets, net | $ | 26,001 | $ | 45,366 |
(1) | We started amortizing in-process R&D during the first quarter of fiscal 2018, as the related technology was completed and made generally available in the first quarter of fiscal 2018. We are amortizing developed technology using the straight-line method over a useful life of five years. Based on the foregoing, the balance of in-process R&D is now presented as part of developed technology as of July 31, 2018. |
Fiscal Year Ended July 31, | |||||||||||
2016 As Adjusted (1) | 2017 As Adjusted (1) | 2018 | |||||||||
(in thousands) | |||||||||||
Domestic | $ | (67,776 | ) | $ | (304,363 | ) | $ | (201,666 | ) | ||
Foreign | (38,140 | ) | (70,423 | ) | (88,048 | ) | |||||
Loss before provision for income taxes | $ | (105,916 | ) | $ | (374,786 | ) | $ | (289,714 | ) |
(1) | Adjusted to include the impact of ASC 606. Refer to Note 3 for more details on the impact of the adoption of this standard. |
As of July 31, | |||||||
2017 | 2018 | ||||||
(in thousands) | |||||||
Intangible assets, net—beginning balance | $ | — | $ | 26,001 | |||
Acquired intangible assets | 28,230 | 25,920 | |||||
Amortization of intangible assets (1) | (2,229 | ) | (6,555 | ) | |||
Intangible assets, net—ending balance | $ | 26,001 | $ | 45,366 |
(1) | Represents amortization expense related to finite-lived intangible assets recognized during the year in the consolidated statements of operations, within product cost of revenue and sales and marketing expenses. |
As of July 31, 2017 | |||||||||||
As Previously Reported | Impact of Adoption | As Adjusted | |||||||||
(in thousands) | |||||||||||
Assets | |||||||||||
Deferred commissions—current | $ | 27,679 | $ | (3,836 | ) | (1) | $ | 23,843 | |||
Deferred commissions—non-current | 33,709 | 15,975 | (1) | 49,684 | |||||||
Total deferred commissions | $ | 61,388 | $ | 12,139 | $ | 73,527 | |||||
Liabilities | |||||||||||
Deferred revenue—current | $ | 233,498 | $ | (63,375 | ) | (2) | $ | 170,123 | |||
Deferred revenue—non-current | 292,573 | (93,640 | ) | (2) | 198,933 | ||||||
Total deferred revenue | $ | 526,071 | $ | (157,015 | ) | $ | 369,056 | ||||
Accrued expenses and other current liabilities | $ | 9,414 | $ | 293 | (3) | $ | 9,707 | ||||
Stockholders' Equity | $ | 48,202 | $ | 168,861 | $ | 217,063 |
(1) | Impact of cumulative change in commissions expense |
(2) | Impact of cumulative change in revenue |
(3) | Impact of cumulative change in provision for income taxes |
Fiscal Year Ended July 31, 2016 | |||||||||||
As Previously Reported | Impact of Adoption | As Adjusted | |||||||||
(in thousands, except per share data) | |||||||||||
Revenue | |||||||||||
Product | $ | 350,798 | $ | 63,112 | $ | 413,910 | |||||
Support, entitlements and other services | 94,130 | (4,630 | ) | 89,500 | |||||||
Total revenue | $ | 444,928 | $ | 58,482 | $ | 503,410 | |||||
Gross profit | $ | 274,141 | $ | 58,482 | $ | 332,623 | |||||
Operating expenses | |||||||||||
Sales and marketing expenses | $ | 288,493 | $ | (1,909 | ) | $ | 286,584 | ||||
Loss from operations | $ | (165,017 | ) | $ | 60,391 | $ | (104,626 | ) | |||
Net loss | $ | (168,499 | ) | $ | 60,266 | $ | (108,233 | ) | |||
Basic and diluted net loss per share | $ | (3.83 | ) | $ | 1.37 | $ | (2.46 | ) |
Fiscal Year Ended July 31, 2017 | |||||||||||
As Previously Reported | Impact of Adoption | As Adjusted | |||||||||
(in thousands, except per share data) | |||||||||||
Revenue | |||||||||||
Product | $ | 583,011 | $ | 90,286 | $ | 673,297 | |||||
Support, entitlements and other services | 183,858 | (11,252 | ) | 172,606 | |||||||
Total revenue | $ | 766,869 | $ | 79,034 | $ | 845,903 | |||||
Gross profit | $ | 439,538 | $ | 79,034 | $ | 518,572 | |||||
Operating expenses | |||||||||||
Sales and marketing expenses | $ | 500,529 | $ | 492 | $ | 501,021 | |||||
Loss from operations | $ | (426,951 | ) | $ | 78,542 | $ | (348,409 | ) | |||
Net loss | $ | (458,011 | ) | $ | 78,373 | $ | (379,638 | ) | |||
Basic and diluted net loss per share | $ | (3.57 | ) | $ | 0.61 | $ | (2.96 | ) |
Fiscal Year Ended July 31, 2016 | |||||||||||
As Previously Reported | Impact of Adoption | As Adjusted | |||||||||
(in thousands) | |||||||||||
U.S. | $ | 280,800 | $ | 38,496 | $ | 319,296 | |||||
Europe, the Middle East and Africa | 81,320 | (15,721 | ) | 65,599 | |||||||
Asia Pacific | 63,610 | 33,113 | 96,723 | ||||||||
Other Americas | 19,198 | 2,594 | 21,792 | ||||||||
Total revenue | $ | 444,928 | $ | 58,482 | $ | 503,410 |
Fiscal Year Ended July 31, 2017 | |||||||||||
As Previously Reported | Impact of Adoption | As Adjusted | |||||||||
(in thousands) | |||||||||||
U.S. | $ | 462,770 | $ | 25,309 | $ | 488,079 | |||||
Europe, the Middle East and Africa | 139,170 | (355 | ) | 138,815 | |||||||
Asia Pacific | 131,921 | 54,943 | 186,864 | ||||||||
Other Americas | 33,008 | (863 | ) | 32,145 | |||||||
Total revenue | $ | 766,869 | $ | 79,034 | $ | 845,903 |
Fiscal Year Ended July 31, 2016 | |||||||||||
As Previously Reported | Impact of Adoption | As Adjusted | |||||||||
(in thousands) | |||||||||||
Cash flows from operating activities: | |||||||||||
Net loss | $ | (168,499 | ) | $ | 60,266 | $ | (108,233 | ) | |||
Adjustments to reconcile net loss to net cash provided by operating activities: | |||||||||||
Deferred commissions | $ | (19,813 | ) | $ | (1,911 | ) | $ | (21,724 | ) | ||
Accrued expenses and other liabilities | $ | (1,336 | ) | $ | 127 | $ | (1,209 | ) | |||
Deferred revenue | $ | 192,867 | $ | (58,482 | ) | $ | 134,385 |
Fiscal Year Ended July 31, 2017 | |||||||||||
As Previously Reported | Impact of Adoption | As Adjusted | |||||||||
(in thousands) | |||||||||||
Cash flows from operating activities: | |||||||||||
Net loss | $ | (458,011 | ) | $ | 78,373 | $ | (379,638 | ) | |||
Adjustments to reconcile net loss to net cash provided by operating activities: | |||||||||||
Deferred commissions | $ | (24,495 | ) | $ | 489 | $ | (24,006 | ) | |||
Accrued expenses and other liabilities | $ | 4,944 | $ | 172 | $ | 5,116 | |||||
Deferred revenue | $ | 223,598 | $ | (79,034 | ) | $ | 144,564 |
Fiscal Year Ended July 31, | |||||||||||||
2017 | 2018 | ||||||||||||
Number of Shares | Grant Date Fair Value per Share | Number of Shares | Grant Date Fair Value per Share | ||||||||||
Outstanding at beginning of period | 12,265,369 | $ | 13.23 | 17,376,090 | $ | 18.85 | |||||||
Granted | 12,986,597 | $ | 21.84 | 14,947,403 | $ | 39.44 | |||||||
Released | (6,146,169 | ) | $ | 15.63 | (5,823,800 | ) | $ | 19.96 | |||||
Canceled/forfeited | (1,729,707 | ) | $ | 13.57 | (2,902,194 | ) | $ | 22.34 | |||||
Outstanding at end of period | 17,376,090 | $ | 18.85 | 23,597,499 | $ | 31.20 |
As of July 31, | |||||||
2017 | 2018 | ||||||
(in thousands) | |||||||
Other tax assets—non-current | $ | — | $ | 30,927 | |||
Deferred tax assets—non-current | 3,420 | 2,860 | |||||
Other | 4,229 | 4,068 | |||||
Total other assets—non-current | $ | 7,649 | $ | 37,855 |
Fiscal Year Ended July 31, | ||||||||||||||||||||||||||
2017 | 2018 | |||||||||||||||||||||||||
Number of Shares | Weighted Average Exercise Price | Weighted Average Remaining Contractual Life | Aggregate Intrinsic Value | Number of Shares | Weighted Average Exercise Price | Weighted Average Remaining Contractual Life | Aggregate Intrinsic Value | |||||||||||||||||||
(in years) | (in thousands) | (in years) | (in thousands) | |||||||||||||||||||||||
Outstanding at beginning of period | 26,166,968 | (1) | $ | 4.39 | 7.5 | $ | 208,101 | 20,334,531 | $ | 4.59 | 6.4 | $ | 338,787 | |||||||||||||
Options granted | 1,047,950 | $ | 12.14 | — | $ | — | ||||||||||||||||||||
Options exercised | (4,786,381 | ) | $ | 3.27 | (8,672,623 | ) | $ | 3.81 | ||||||||||||||||||
Options canceled/forfeited | (2,094,006 | ) | $ | 8.89 | (329,354 | ) | $ | 6.63 | ||||||||||||||||||
Outstanding at end of period | 20,334,531 | $ | 4.59 | 6.4 | $ | 338,787 | 11,332,554 | $ | 5.12 | 5.6 | $ | 496,022 | ||||||||||||||
Exercisable at end of period | 19,645,676 | $ | 4.43 | 6.3 | $ | 330,486 | 11,159,045 | $ | 5.01 | 5.5 | $ | 489,682 | ||||||||||||||
Vested and expected to vest at end of period | 20,334,531 | $ | 4.59 | 6.4 | $ | 338,787 | 11,332,554 | $ | 5.12 | 5.6 | $ | 496,022 |
(1) | Includes 455,000 stock options with both service and performance conditions with a weighted average fair value per share of $3.78 (the \"Performance Stock Options\"). Vesting of the Performance Stock Options was subject to continuous service with us (the \"service condition\") and satisfaction of certain liquidity events (the \"performance condition\"). We recognized cumulative stock-based compensation expense related to the Performance Stock Options in the first quarter of fiscal 2017, as the performance condition was met upon the successful completion of our IPO. The cumulative stock-based compensation expense recorded in the first quarter of fiscal 2017 was for the portion of the awards for which the relevant service condition had been satisfied and the remaining expense is being recognized over the remaining service period. |
Fiscal Year Ended July 31, | |||||
2017 | 2018 | ||||
Expected term (in years) | 0.75 | 0.75 | |||
Risk-free interest rate | 0.6 | % | 1.4 | % | |
Volatility | 51.0 | % | 49.8 | % | |
Dividend yield | — | % | — | % |
Fiscal Year Ended July 31, | |||||||
2016 | 2017 | ||||||
Fair value of common stock | $ | 14.81 | $ | 12.14 | |||
Expected term (in years) | 6.1 | 6.1 | |||||
Risk-free interest rate | 1.6 | % | 1.3 | % | |||
Volatility | 42 | % | 52 | % | |||
Dividend yield | — | % | — | % |
As of July 31, 2018 | ||
Shares reserved for future equity grants | 11,169,061 | |
Shares underlying outstanding stock options | 11,332,554 | |
Shares underlying outstanding restricted stock units | 23,597,499 | |
Shares reserved for future employee stock purchase plan awards | 1,682,461 | |
Shares underlying outstanding common stock warrants | 34,180 | |
Total | 47,815,755 |
Fiscal Year Ended July 31, | |||||||
2017 | 2018 | ||||||
(in thousands) | |||||||
Balance at the beginning of the year | $ | 19,711 | $ | 42,655 | |||
Increases related to current year tax positions | 22,571 | 58,727 | |||||
Increases related to prior year tax positions | 373 | 4,893 | |||||
Decreases related to prior year tax positions | — | (14,559 | ) | ||||
Balance at the end of the year | $ | 42,655 | $ | 91,716 |
Fiscal Year Ending July 31: | Amount | ||
(in thousands) | |||
2019 | $ | 9,551 | |
2020 | 9,511 | ||
2021 | 9,511 | ||
2022 | 8,314 | ||
2023 | 3,971 | ||
Thereafter | 4,508 | ||
Total | $ | 45,366 |
Revenue | Accounts Receivable as of July 31, | ||||||||||||||
Fiscal Year Ended July 31, | |||||||||||||||
Partners | 2016 As Adjusted (2) | 2017 As Adjusted (2) | 2018 | 2017 | 2018 | ||||||||||
Partner A | 14 | % | (1) | 10 | % | (1) | 16 | % | |||||||
Partner B | 18 | % | 19 | % | 20 | % | 12 | % | 13 | % | |||||
Partner C | 13 | % | 16 | % | 18 | % | 14 | % | 15 | % | |||||
Partner D | 11 | % | 10 | % | (1) | 20 | % | (1) | |||||||
Partner E | 10 | % | (1) | (1) | (1) | (1) | |||||||||
Partner F | 15 | % | 14 | % | 13 | % | 18 | % | 12 | % |
(1) | Less than 10% |
(2) | Adjusted to include the impact of ASC 606. Refer to Note 3 for more details on the impact of the adoption of this standard. |
Fiscal Year Ended July 31, | |||||||||||
2016 As Adjusted (1) | 2017 As Adjusted (1) | 2018 | |||||||||
(in thousands) | |||||||||||
U.S. | $ | 319,296 | $ | 488,079 | $ | 648,805 | |||||
Europe, the Middle East and Africa | 65,599 | 138,815 | 224,392 | ||||||||
Asia Pacific | 96,723 | 186,864 | 240,247 | ||||||||
Other Americas | 21,792 | 32,145 | 42,013 | ||||||||
Total revenue | $ | 503,410 | $ | 845,903 | $ | 1,155,457 |
(1) | Adjusted to include the impact of ASC 606. Refer to Note 3 for more details on the impact of the adoption of this standard. |
As of July 31, 2018 | ||
Shares reserved for future equity grants | 11,169,061 | |
Shares underlying outstanding stock options | 11,332,554 | |
Shares underlying outstanding restricted stock units | 23,597,499 | |
Shares reserved for future employee stock purchase plan awards | 1,682,461 | |
Shares underlying outstanding common stock warrants | 34,180 | |
Total | 47,815,755 |
As of July 31, 2018 | |||
(in thousands) | |||
Due within one year | $ | 463,940 | |
Due in one year through three years | 164,388 | ||
Total | $ | 628,328 |
Estimated Useful Life | As of July 31, | ||||||||
2017 | 2018 | ||||||||
(in months) | (in thousands) | ||||||||
Computer, production, engineering, and other equipment | 36 | $ | 85,280 | $ | 131,805 | ||||
Demonstration units | 12 | 46,387 | 53,547 | ||||||
Leasehold improvements | (1) | 10,562 | 19,916 | ||||||
Furniture and fixtures | 60 | 4,744 | 7,636 | ||||||
Total property and equipment, gross | 146,973 | 212,904 | |||||||
Less: Accumulated depreciation and amortization | (88,901 | ) | (127,793 | ) | |||||
Total property and equipment, net | $ | 58,072 | $ | 85,111 |
(1) | Leasehold improvements are amortized over the shorter of the estimated useful lives of the improvements or the remaining lease term. |
As of July 31, | |||||||
2017 | 2018 | ||||||
(in thousands) | |||||||
Indefinite-lived intangible asset: | |||||||
In-process R&D (1) | $ | 16,100 | $ | — | |||
Finite-lived intangible assets: | |||||||
Developed technology (1) | 7,300 | 47,500 | |||||
Customer relationships | 4,830 | 6,650 | |||||
Total finite-lived intangible assets, gross | 12,130 | 54,150 | |||||
Total intangible assets, gross | 28,230 | 54,150 | |||||
Less: | |||||||
Accumulated amortization of developed technology | (1,314 | ) | (6,956 | ) | |||
Accumulated amortization of customer relationships | (915 | ) | (1,828 | ) | |||
Total accumulated amortization | (2,229 | ) | (8,784 | ) | |||
Intangible assets, net | $ | 26,001 | $ | 45,366 |
(1) | We started amortizing in-process R&D during the first quarter of fiscal 2018, as the related technology was completed and made generally available in the first quarter of fiscal 2018. We are amortizing developed technology using the straight-line method over a useful life of five years. Based on the foregoing, the balance of in-process R&D is now presented as part of developed technology as of July 31, 2018. |
As of July 31, | |||||||
2017 | 2018 | ||||||
(in thousands) | |||||||
Intangible assets, net—beginning balance | $ | — | $ | 26,001 | |||
Acquired intangible assets | 28,230 | 25,920 | |||||
Amortization of intangible assets (1) | (2,229 | ) | (6,555 | ) | |||
Intangible assets, net—ending balance | $ | 26,001 | $ | 45,366 |
(1) | Represents amortization expense related to finite-lived intangible assets recognized during the year in the consolidated statements of operations, within product cost of revenue and sales and marketing expenses. |
Fiscal Year Ending July 31: | Amount | ||
(in thousands) | |||
2019 | $ | 9,551 | |
2020 | 9,511 | ||
2021 | 9,511 | ||
2022 | 8,314 | ||
2023 | 3,971 | ||
Thereafter | 4,508 | ||
Total | $ | 45,366 |
Carrying Amount | |||
(in thousands) | |||
Balance at July 31, 2016 | $ | — | |
Acquired in Calm Acquisition | 4,819 | ||
Acquired in PernixData Acquisition | 11,853 | ||
Balance at July 31, 2017 | 16,672 | ||
Acquired in Netsil Acquisition | 53,085 | ||
Acquired in Minjar Acquisition | 18,002 | ||
Balance at July 31, 2018 | $ | 87,759 |
As of July 31, | |||||||
2017 | 2018 | ||||||
(in thousands) | |||||||
Other tax assets—non-current | $ | — | $ | 30,927 | |||
Deferred tax assets—non-current | 3,420 | 2,860 | |||||
Other | 4,229 | 4,068 | |||||
Total other assets—non-current | $ | 7,649 | $ | 37,855 |
As of July 31, | |||||||
2017 | 2018 | ||||||
(in thousands) | |||||||
Contributions to ESPP withheld | $ | 14,371 | $ | 21,931 | |||
Accrued commissions | 20,388 | 21,660 | |||||
Accrued bonus | 7,342 | 12,129 | |||||
Accrued vacation | 6,286 | 10,548 | |||||
Payroll taxes payable | 3,434 | 9,563 | |||||
Other | 5,700 | 9,567 | |||||
Total accrued compensation and benefits | $ | 57,521 | $ | 85,398 |
As of July 31, | |||||||
2017 | 2018 | ||||||
(in thousands) | |||||||
Income taxes payable (1)(2) | $ | 3,873 | $ | 20,863 | |||
Accrued professional services | 4,167 | 5,838 | |||||
Other | 1,667 | 4,981 | |||||
Total accrued expenses and other current liabilities | $ | 9,707 | $ | 31,682 |
(1) | Balance as of July 31, 2017 was adjusted to reflect the impact of the adoption of ASC 606 on income taxes. See Note 3 for a summary of adjustments. |
(2) | The increase in income taxes payable during the fiscal year ended July 31, 2018 was due primarily to a payable related to the alternative minimum tax associated with the migration of certain intangible assets. For additional details, refer to Note 11. |