☒
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
|
91-2183967
|
||
(State or Other Jurisdictions of Incorporation)
|
|
(I.R.S. Employer Identification Number)
|
||
|
|
|
|
|
221 Main St.
|
Suite 1550
|
San Francisco
|
California
|
94105
|
(Address of Principal Executive Offices)
|
(Zip Code)
|
Title of each class
|
Trading Symbol
|
Name of each exchange on which registered
|
Common Stock, par value $0.0001 per share
|
DOCU
|
The Nasdaq Stock Market LLC
|
☐
|
Large accelerated filer
|
☐
|
Accelerated filer
|
|
|
|
|
☒
|
Non-accelerated filer
|
☐
|
Smaller reporting company
|
|
|
|
|
☒
|
Emerging growth company
|
|
|
|
|
|
|
||
|
||
|
||
|
||
|
||
|
||
|
|
|
|
||
▪
|
our ability to effectively sustain and manage our growth and future expenses, and our ability to achieve and maintain future profitability;
|
▪
|
our ability to attract new customers and to maintain and expand our existing customer base;
|
▪
|
our ability to scale and update our software suite to respond to customers’ needs and rapid technological change;
|
▪
|
the effects of increased competition on our market and our ability to compete effectively;
|
▪
|
our ability to expand use cases within existing customers and vertical solutions;
|
▪
|
our ability to expand our operations and increase adoption of our software suite internationally;
|
▪
|
our ability to strengthen and foster our relationship with developers;
|
▪
|
our ability to expand our direct sales force, customer success team and strategic partnerships around the world;
|
▪
|
our ability to successfully integrate SpringCM's operations;
|
▪
|
our ability to implement our plans, forecasts and other expectations with respect to SpringCM's business;
|
▪
|
our ability to realize the anticipated benefits of the acquisition of SpringCM, including the possibility that the expected benefits from the acquisition will not be realized or will not be realized within the expected time period;
|
▪
|
our ability to maintain, protect and enhance our brand;
|
▪
|
the sufficiency of our cash and cash equivalents to satisfy our liquidity needs;
|
▪
|
our failure or the failure of our software suite of services to comply with applicable industry standards, laws and regulations;
|
▪
|
our ability to maintain, protect and enhance our intellectual property;
|
▪
|
our ability to successfully defend litigation against us;
|
▪
|
our ability to attract large organizations as users;
|
▪
|
our ability to maintain our corporate culture;
|
▪
|
our ability to offer high-quality customer support;
|
▪
|
our ability to hire, retain and motivate qualified personnel;
|
▪
|
our ability to identify targets for, execute on and realize the benefits of potential acquisitions;
|
▪
|
our ability to estimate the size and potential growth of our target market; and
|
▪
|
our ability to maintain proper and effective internal controls.
|
(in thousands, except per share data)
|
July 31, 2019
|
|
January 31, 2019
|
||||
Assets
|
|
|
|
||||
Current assets
|
|
|
|
||||
Cash and cash equivalents
|
$
|
224,290
|
|
|
$
|
517,811
|
|
Investments—current
|
525,963
|
|
|
251,203
|
|
||
Restricted cash
|
133
|
|
|
367
|
|
||
Accounts receivable
|
138,652
|
|
|
174,548
|
|
||
Contract assets—current
|
15,548
|
|
|
10,616
|
|
||
Prepaid expense and other current assets
|
38,907
|
|
|
29,976
|
|
||
Total current assets
|
943,493
|
|
|
984,521
|
|
||
Investments—noncurrent
|
180,146
|
|
|
164,220
|
|
||
Property and equipment, net
|
92,078
|
|
|
75,832
|
|
||
Operating lease right-of-use assets
|
137,292
|
|
|
—
|
|
||
Goodwill
|
195,427
|
|
|
195,225
|
|
||
Intangible assets, net
|
65,070
|
|
|
74,203
|
|
||
Deferred contract acquisition costs—noncurrent
|
124,434
|
|
|
112,583
|
|
||
Other assets—noncurrent
|
23,896
|
|
|
8,833
|
|
||
Total assets
|
$
|
1,761,836
|
|
|
$
|
1,615,417
|
|
Liabilities and Stockholders' Equity
|
|
|
|
||||
Current liabilities
|
|
|
|
||||
Accounts payable
|
$
|
23,452
|
|
|
$
|
19,590
|
|
Accrued expenses
|
34,227
|
|
|
21,755
|
|
||
Accrued compensation
|
79,980
|
|
|
77,553
|
|
||
Contract liabilities—current
|
402,734
|
|
|
381,060
|
|
||
Operating lease liabilities—current
|
17,193
|
|
|
—
|
|
||
Deferred rent—current
|
—
|
|
|
2,452
|
|
||
Other liabilities—current
|
16,563
|
|
|
13,903
|
|
||
Total current liabilities
|
574,149
|
|
|
516,313
|
|
||
Convertible senior notes, net
|
451,934
|
|
|
438,932
|
|
||
Contract liabilities—noncurrent
|
7,784
|
|
|
7,712
|
|
||
Operating lease liabilities—noncurrent
|
150,493
|
|
|
—
|
|
||
Deferred rent—noncurrent
|
—
|
|
|
24,195
|
|
||
Deferred tax liability—noncurrent
|
4,270
|
|
|
4,207
|
|
||
Other liabilities—noncurrent
|
6,527
|
|
|
9,696
|
|
||
Total liabilities
|
1,195,157
|
|
|
1,001,055
|
|
||
Commitments and contingencies (Note 11)
|
|
|
|
||||
Stockholders' equity
|
|
|
|
||||
Preferred stock, $0.0001 par value; 10,000 shares authorized, 0 shares issued and outstanding as of July 31, 2019 and January 31, 2019
|
—
|
|
|
—
|
|
||
Common stock, $0.0001 par value; 500,000 shares authorized, 175,953 shares outstanding as of July 31, 2019; 500,000 shares authorized, 169,303 shares outstanding as of January 31, 2019
|
18
|
|
|
17
|
|
||
Additional paid-in capital
|
1,612,786
|
|
|
1,545,088
|
|
||
Accumulated other comprehensive loss
|
(2,945
|
)
|
|
(1,965
|
)
|
||
Accumulated deficit
|
(1,043,180
|
)
|
|
(928,778
|
)
|
||
Total stockholders' equity
|
566,679
|
|
|
614,362
|
|
||
Total liabilities and stockholders' equity
|
$
|
1,761,836
|
|
|
$
|
1,615,417
|
|
|
Three Months Ended July 31,
|
|
Six Months Ended July 31,
|
||||||||||||
(in thousands, except per share data)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Revenue:
|
|
|
|
|
|
|
|
||||||||
Subscription
|
$
|
220,811
|
|
|
$
|
158,461
|
|
|
$
|
422,269
|
|
|
$
|
306,659
|
|
Professional services and other
|
14,801
|
|
|
8,583
|
|
|
27,305
|
|
|
16,193
|
|
||||
Total revenue
|
235,612
|
|
|
167,044
|
|
|
449,574
|
|
|
322,852
|
|
||||
Cost of revenue:
|
|
|
|
|
|
|
|
||||||||
Subscription
|
39,472
|
|
|
23,057
|
|
|
72,591
|
|
|
55,495
|
|
||||
Professional services and other
|
21,704
|
|
|
13,304
|
|
|
40,604
|
|
|
39,160
|
|
||||
Total cost of revenue
|
61,176
|
|
|
36,361
|
|
|
113,195
|
|
|
94,655
|
|
||||
Gross profit
|
174,436
|
|
|
130,683
|
|
|
336,379
|
|
|
228,197
|
|
||||
Operating expenses:
|
|
|
|
|
|
|
|
||||||||
Sales and marketing
|
150,886
|
|
|
103,779
|
|
|
280,822
|
|
|
294,864
|
|
||||
Research and development
|
47,517
|
|
|
33,773
|
|
|
84,700
|
|
|
104,643
|
|
||||
General and administrative
|
40,755
|
|
|
30,851
|
|
|
78,016
|
|
|
133,968
|
|
||||
Total expenses
|
239,158
|
|
|
168,403
|
|
|
443,538
|
|
|
533,475
|
|
||||
Loss from operations
|
(64,722
|
)
|
|
(37,720
|
)
|
|
(107,159
|
)
|
|
(305,278
|
)
|
||||
Interest expense
|
(7,273
|
)
|
|
(47
|
)
|
|
(14,429
|
)
|
|
(240
|
)
|
||||
Interest income and other income, net
|
4,531
|
|
|
2,998
|
|
|
9,748
|
|
|
770
|
|
||||
Loss before provision for income taxes
|
(67,464
|
)
|
|
(34,769
|
)
|
|
(111,840
|
)
|
|
(304,748
|
)
|
||||
Provision for income taxes
|
1,168
|
|
|
1,945
|
|
|
2,514
|
|
|
2,653
|
|
||||
Net loss
|
$
|
(68,632
|
)
|
|
$
|
(36,714
|
)
|
|
$
|
(114,354
|
)
|
|
$
|
(307,401
|
)
|
Net loss per share attributable to common stockholders, basic and diluted
|
$
|
(0.39
|
)
|
|
$
|
(0.22
|
)
|
|
$
|
(0.66
|
)
|
|
$
|
(3.01
|
)
|
Weighted-average number of shares used in computing net loss per share attributable to common stockholders, basic and diluted
|
175,389
|
|
|
166,084
|
|
|
173,773
|
|
|
102,284
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
||||||||
Foreign currency translation losses, net of tax
|
$
|
(45
|
)
|
|
$
|
(3,085
|
)
|
|
$
|
(1,676
|
)
|
|
$
|
(5,413
|
)
|
Unrealized gains on investments, net of tax
|
358
|
|
|
—
|
|
|
696
|
|
|
—
|
|
||||
Other comprehensive income (loss)
|
313
|
|
|
(3,085
|
)
|
|
(980
|
)
|
|
(5,413
|
)
|
||||
Comprehensive loss
|
$
|
(68,319
|
)
|
|
$
|
(39,799
|
)
|
|
$
|
(115,334
|
)
|
|
$
|
(312,814
|
)
|
|
|
|
|
|
|
|
|
||||||||
Stock-based compensation expense included in costs and expenses:
|
|
|
|
|
|
|
|
||||||||
Cost of revenue—subscription
|
$
|
3,115
|
|
|
$
|
1,588
|
|
|
$
|
5,397
|
|
|
$
|
11,543
|
|
Cost of revenue—professional services
|
4,821
|
|
|
2,822
|
|
|
8,261
|
|
|
18,867
|
|
||||
Sales and marketing
|
25,942
|
|
|
16,791
|
|
|
44,044
|
|
|
129,272
|
|
||||
Research and development
|
11,963
|
|
|
7,359
|
|
|
19,280
|
|
|
54,627
|
|
||||
General and administrative
|
9,951
|
|
|
11,605
|
|
|
21,081
|
|
|
95,650
|
|
|
Common Stock
|
|
Additional Paid-In Capital
|
|
Accumulated Other Comprehensive Loss
|
|
Accumulated Deficit
|
|
Total Stockholders’ Equity
|
|||||||||||||
(in thousands)
|
Shares
|
|
Amount
|
|
|
|
|
|||||||||||||||
Balances at April 30, 2019
|
173,628
|
|
|
$
|
17
|
|
|
$
|
1,575,471
|
|
|
$
|
(3,258
|
)
|
|
$
|
(974,548
|
)
|
|
$
|
597,682
|
|
Exercise of stock options
|
1,235
|
|
|
—
|
|
|
10,194
|
|
|
—
|
|
|
—
|
|
|
10,194
|
|
|||||
Settlement of RSUs
|
1,681
|
|
|
1
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Tax withholding on RSU settlement
|
(591
|
)
|
|
—
|
|
|
(29,841
|
)
|
|
—
|
|
|
—
|
|
|
(29,841
|
)
|
|||||
Employee stock-based compensation expense
|
—
|
|
|
—
|
|
|
56,928
|
|
|
—
|
|
|
—
|
|
|
56,928
|
|
|||||
Non-employee stock-based compensation expense
|
—
|
|
|
—
|
|
|
35
|
|
|
—
|
|
|
—
|
|
|
35
|
|
|||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(68,632
|
)
|
|
(68,632
|
)
|
|||||
Other comprehensive income, net
|
—
|
|
|
—
|
|
|
—
|
|
|
313
|
|
|
—
|
|
|
313
|
|
|||||
Balances at July 31, 2019
|
175,953
|
|
|
$
|
18
|
|
|
$
|
1,612,786
|
|
|
$
|
(2,945
|
)
|
|
$
|
(1,043,180
|
)
|
|
$
|
566,679
|
|
|
Redeemable Convertible Preferred Stock
|
|
|
Common Stock
|
|
Additional Paid-In Capital
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Accumulated Deficit
|
|
Total Stockholders’ Equity (Deficit)
|
||||||||||||||||||
(in thousands)
|
Shares
|
|
Amount
|
|
|
Shares
|
|
Amount
|
|
|
|
|
||||||||||||||||||
Balances at April 30, 2018
|
100,226
|
|
|
$
|
547,854
|
|
|
|
36,776
|
|
|
$
|
4
|
|
|
$
|
438,200
|
|
|
$
|
1,075
|
|
|
$
|
(773,007
|
)
|
|
$
|
(333,728
|
)
|
Exercise of stock options
|
—
|
|
|
—
|
|
|
|
324
|
|
|
—
|
|
|
2,503
|
|
|
—
|
|
|
—
|
|
|
2,503
|
|
||||||
Employee stock-based compensation expense
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
40,380
|
|
|
—
|
|
|
—
|
|
|
40,380
|
|
||||||
Non-employee stock-based compensation expense
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
113
|
|
|
—
|
|
|
—
|
|
|
113
|
|
||||||
Issuance of common stock in connection with initial public offering, net of offering costs
|
—
|
|
|
—
|
|
|
|
19,314
|
|
|
2
|
|
|
525,297
|
|
|
—
|
|
|
—
|
|
|
525,299
|
|
||||||
Conversion of redeemable convertible preferred stock to common stock in connection with initial public offering
|
(100,226
|
)
|
|
(547,854
|
)
|
|
|
100,350
|
|
|
10
|
|
|
547,844
|
|
|
—
|
|
|
—
|
|
|
547,854
|
|
||||||
Conversion of preferred stock warrant to common stock warrant in connection with initial public offering
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
848
|
|
|
—
|
|
|
—
|
|
|
848
|
|
||||||
Exercise of warrants
|
—
|
|
|
—
|
|
|
|
22
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Net loss
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(36,714
|
)
|
|
(36,714
|
)
|
||||||
Other comprehensive loss, net
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,085
|
)
|
|
—
|
|
|
(3,085
|
)
|
||||||
Balances at July 31, 2018
|
—
|
|
|
$
|
—
|
|
|
|
156,786
|
|
|
$
|
16
|
|
|
$
|
1,555,185
|
|
|
$
|
(2,010
|
)
|
|
$
|
(809,721
|
)
|
|
$
|
743,470
|
|
|
Common Stock
|
|
Additional Paid-In Capital
|
|
Accumulated Other Comprehensive Loss
|
|
Accumulated Deficit
|
|
Total Stockholders’ Equity
|
|||||||||||||
(in thousands)
|
Shares
|
|
Amount
|
|
|
|
|
|||||||||||||||
Balances at January 31, 2019
|
169,303
|
|
|
$
|
17
|
|
|
$
|
1,545,088
|
|
|
$
|
(1,965
|
)
|
|
$
|
(928,778
|
)
|
|
$
|
614,362
|
|
Exercise of stock options
|
3,869
|
|
|
—
|
|
|
42,448
|
|
|
—
|
|
|
—
|
|
|
42,448
|
|
|||||
Settlement of RSUs
|
4,144
|
|
|
1
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Tax withholding on RSU settlement
|
(1,594
|
)
|
|
—
|
|
|
(85,978
|
)
|
|
—
|
|
|
—
|
|
|
(85,978
|
)
|
|||||
Employee stock purchase plan
|
231
|
|
|
—
|
|
|
10,563
|
|
|
—
|
|
|
—
|
|
|
10,563
|
|
|||||
Employee stock-based compensation expense
|
—
|
|
|
—
|
|
|
100,597
|
|
|
—
|
|
|
—
|
|
|
100,597
|
|
|||||
Non-employee stock-based compensation expense
|
—
|
|
|
—
|
|
|
69
|
|
|
—
|
|
|
—
|
|
|
69
|
|
|||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(114,354
|
)
|
|
(114,354
|
)
|
|||||
Cumulative impact of Topic 842 adoption
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(48
|
)
|
|
(48
|
)
|
|||||
Other comprehensive loss, net
|
—
|
|
|
—
|
|
|
—
|
|
|
(980
|
)
|
|
—
|
|
|
(980
|
)
|
|||||
Balances at July 31, 2019
|
175,953
|
|
|
$
|
18
|
|
|
$
|
1,612,786
|
|
|
$
|
(2,945
|
)
|
|
$
|
(1,043,180
|
)
|
|
$
|
566,679
|
|
|
Redeemable Convertible Preferred Stock
|
|
|
Common Stock
|
|
Additional Paid-In Capital
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Accumulated Deficit
|
|
Total Stockholders’ Equity (Deficit)
|
||||||||||||||||||
(in thousands)
|
Shares
|
|
Amount
|
|
|
Shares
|
|
Amount
|
|
|
|
|
||||||||||||||||||
Balances at January 31, 2018
|
100,226
|
|
|
$
|
547,501
|
|
|
|
35,700
|
|
|
$
|
4
|
|
|
$
|
160,265
|
|
|
$
|
3,403
|
|
|
$
|
(502,320
|
)
|
|
$
|
(338,648
|
)
|
Exercise of stock options
|
—
|
|
|
—
|
|
|
|
1,400
|
|
|
—
|
|
|
10,318
|
|
|
—
|
|
|
—
|
|
|
10,318
|
|
||||||
Employee stock-based compensation expense
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
310,133
|
|
|
—
|
|
|
—
|
|
|
310,133
|
|
||||||
Non-employee stock-based compensation expense
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
833
|
|
|
—
|
|
|
—
|
|
|
833
|
|
||||||
Accretion of preferred stock
|
—
|
|
|
353
|
|
|
|
—
|
|
|
—
|
|
|
(353
|
)
|
|
—
|
|
|
—
|
|
|
(353
|
)
|
||||||
Issuance of common stock in connection with initial public offering, net of offering costs
|
—
|
|
|
—
|
|
|
|
19,314
|
|
|
2
|
|
|
525,297
|
|
|
—
|
|
|
—
|
|
|
525,299
|
|
||||||
Conversion of redeemable convertible preferred stock to common stock in connection with initial public offering
|
(100,226
|
)
|
|
(547,854
|
)
|
|
|
100,350
|
|
|
10
|
|
|
547,844
|
|
|
—
|
|
|
—
|
|
|
547,854
|
|
||||||
Conversion of preferred stock warrant to common stock warrant in connection with initial public offering
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
848
|
|
|
—
|
|
|
—
|
|
|
848
|
|
||||||
Exercise of warrants
|
—
|
|
|
—
|
|
|
|
22
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Net loss
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(307,401
|
)
|
|
(307,401
|
)
|
||||||
Other comprehensive loss, net
|
—
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5,413
|
)
|
|
—
|
|
|
(5,413
|
)
|
||||||
Balances at July 31, 2018
|
—
|
|
|
$
|
—
|
|
|
|
156,786
|
|
|
$
|
16
|
|
|
$
|
1,555,185
|
|
|
$
|
(2,010
|
)
|
|
$
|
(809,721
|
)
|
|
$
|
743,470
|
|
|
Six Months Ended July 31,
|
||||||
(in thousands)
|
2019
|
|
2018
|
||||
Cash flows from operating activities:
|
|
|
|
||||
Net loss
|
$
|
(114,354
|
)
|
|
$
|
(307,401
|
)
|
Adjustments to reconcile net loss to net cash used in operating activities
|
|
|
|
||||
Depreciation and amortization
|
24,261
|
|
|
15,681
|
|
||
Amortization of deferred contract acquisition and fulfillment costs
|
31,149
|
|
|
19,146
|
|
||
Amortization of debt discount and transaction costs
|
13,002
|
|
|
—
|
|
||
Non-cash operating lease costs
|
8,863
|
|
|
—
|
|
||
Stock-based compensation expense
|
98,063
|
|
|
309,959
|
|
||
Deferred income taxes
|
28
|
|
|
(12
|
)
|
||
Other
|
(2,371
|
)
|
|
(875
|
)
|
||
Changes in operating assets and liabilities
|
|
|
|
||||
Accounts receivable
|
35,896
|
|
|
15,385
|
|
||
Contract assets
|
(4,905
|
)
|
|
1,149
|
|
||
Prepaid expenses and other current assets
|
(3,157
|
)
|
|
(3,406
|
)
|
||
Deferred contract acquisition and fulfillment costs
|
(48,439
|
)
|
|
(30,339
|
)
|
||
Other assets
|
959
|
|
|
1,335
|
|
||
Accounts payable
|
1,588
|
|
|
(5,034
|
)
|
||
Accrued expenses
|
12,439
|
|
|
2,306
|
|
||
Accrued compensation
|
2,427
|
|
|
360
|
|
||
Contract liabilities
|
21,746
|
|
|
19,503
|
|
||
Operating lease liabilities
|
(7,198
|
)
|
|
—
|
|
||
Other liabilities
|
2,063
|
|
|
(69
|
)
|
||
Net cash provided by operating activities
|
72,060
|
|
|
37,688
|
|
||
Cash flows from investing activities:
|
|
|
|
||||
Purchases of marketable securities
|
(530,886
|
)
|
|
—
|
|
||
Maturities of marketable securities
|
244,449
|
|
|
—
|
|
||
Purchases of strategic investments
|
(15,500
|
)
|
|
—
|
|
||
Purchases of property and equipment
|
(29,791
|
)
|
|
(10,520
|
)
|
||
Net cash used in investing activities
|
(331,728
|
)
|
|
(10,520
|
)
|
||
Cash flows from financing activities:
|
|
|
|
||||
Proceeds from issuance of common stock in initial public offering, net of underwriting commissions
|
—
|
|
|
529,305
|
|
||
Payment of tax withholding obligation on RSU settlement
|
(85,978
|
)
|
|
—
|
|
||
Proceeds from exercise of stock options
|
42,448
|
|
|
10,318
|
|
||
Proceeds from employee stock purchase plan
|
10,563
|
|
|
—
|
|
||
Payment of deferred offering costs
|
—
|
|
|
(3,522
|
)
|
||
Net cash provided by (used in) financing activities
|
(32,967
|
)
|
|
536,101
|
|
||
Effect of foreign exchange on cash, cash equivalents and restricted cash
|
(1,120
|
)
|
|
(1,543
|
)
|
||
Net increase (decrease) in cash, cash equivalents and restricted cash
|
(293,755
|
)
|
|
561,726
|
|
||
Cash, cash equivalents and restricted cash at beginning of period
|
518,178
|
|
|
257,436
|
|
||
Cash, cash equivalents and restricted cash at end of period
|
$
|
224,423
|
|
|
$
|
819,162
|
|
|
Six Months Ended July 31,
|
||||||
(in thousands)
|
2019
|
|
2018
|
||||
Supplemental disclosure:
|
|
|
|
||||
Cash paid for interest
|
$
|
1,414
|
|
|
$
|
204
|
|
Cash paid for operating lease liabilities
|
10,984
|
|
|
—
|
|
||
Cash paid for taxes
|
1,109
|
|
|
2,001
|
|
||
Non-cash investing and financing activities:
|
|
|
|
||||
Property and equipment in accounts payable and other accrued liabilities
|
$
|
4,046
|
|
|
$
|
2,100
|
|
Conversion of redeemable convertible preferred stock to common stock in connection with initial public offering
|
—
|
|
|
547,854
|
|
||
Conversion of preferred stock warrant to common stock warrant in connection with initial public offering
|
—
|
|
|
848
|
|
||
Preferred stock accretion
|
—
|
|
|
353
|
|
||
Deferred offering costs accrued and unpaid
|
—
|
|
|
169
|
|
||
Operating lease right-of-use assets exchanged for lease obligations
|
53,754
|
|
|
—
|
|
||
Derecognition of build-to-suit lease
|
2,479
|
|
|
—
|
|
Level 1
|
Quoted prices in active markets for identical assets or liabilities;
|
Level 2
|
Observable inputs other than the quoted prices in active markets for identical assets and liabilities; and
|
Level 3
|
Unobservable inputs for which there is little or no market data, which require us to develop assumptions of what market participants would use in pricing the asset or liability.
|
|
July 31, 2019
|
||||||||||||||
(in thousands)
|
Amortized Cost
|
|
Gross Unrealized Gains
|
|
Gross Unrealized Losses
|
|
Estimated Fair Value
|
||||||||
Level 1:
|
|
|
|
|
|
|
|
||||||||
Cash equivalents
|
|
|
|
|
|
|
|
||||||||
Money market funds
|
$
|
95,787
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
95,787
|
|
Level 2:
|
|
|
|
|
|
|
|
||||||||
Available-for-sale securities
|
|
|
|
|
|
|
|
||||||||
Commercial paper
|
41,197
|
|
|
45
|
|
|
(2
|
)
|
|
41,240
|
|
||||
Corporate notes and bonds
|
351,691
|
|
|
835
|
|
|
(68
|
)
|
|
352,458
|
|
||||
U.S. Treasury securities
|
174,897
|
|
|
172
|
|
|
(31
|
)
|
|
175,038
|
|
||||
U.S. government agency securities
|
137,369
|
|
|
63
|
|
|
(59
|
)
|
|
137,373
|
|
||||
Level 2 total
|
705,154
|
|
|
1,115
|
|
|
(160
|
)
|
|
706,109
|
|
||||
Total
|
$
|
800,941
|
|
|
$
|
1,115
|
|
|
$
|
(160
|
)
|
|
$
|
801,896
|
|
|
|
|
|
|
|
|
|
||||||||
|
January 31, 2019
|
||||||||||||||
(in thousands)
|
Amortized Cost
|
|
Gross Unrealized Gains
|
|
Gross Unrealized Losses
|
|
Estimated Fair Value
|
||||||||
Level 1:
|
|
|
|
|
|
|
|
||||||||
Cash equivalents
|
|
|
|
|
|
|
|
||||||||
Money market funds
|
$
|
350,063
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
350,063
|
|
Level 2:
|
|
|
|
|
|
|
|
||||||||
Cash equivalents
|
|
|
|
|
|
|
|
||||||||
Commercial paper
|
76,828
|
|
|
—
|
|
|
(11
|
)
|
|
76,817
|
|
||||
Corporate notes and bonds
|
2,998
|
|
|
—
|
|
|
—
|
|
|
2,998
|
|
||||
U.S. government agency securities
|
6,491
|
|
|
—
|
|
|
—
|
|
|
6,491
|
|
||||
Available-for-sale securities
|
|
|
|
|
|
|
|
||||||||
Commercial paper
|
86,655
|
|
|
4
|
|
|
(21
|
)
|
|
86,638
|
|
||||
Corporate notes and bonds
|
287,496
|
|
|
389
|
|
|
(105
|
)
|
|
287,780
|
|
||||
U.S. Treasury securities
|
4,982
|
|
|
—
|
|
|
(1
|
)
|
|
4,981
|
|
||||
U.S. government agency securities
|
36,021
|
|
|
7
|
|
|
(4
|
)
|
|
36,024
|
|
||||
Level 2 total
|
501,471
|
|
|
400
|
|
|
(142
|
)
|
|
501,729
|
|
||||
Total
|
$
|
851,534
|
|
|
$
|
400
|
|
|
$
|
(142
|
)
|
|
$
|
851,792
|
|
Due in one year or less
|
$
|
525,963
|
|
Due in one to two years
|
180,146
|
|
|
|
$
|
706,109
|
|
(in thousands)
|
July 31, 2019
|
|
January 31, 2019
|
||||
Computer and network equipment
|
$
|
62,751
|
|
|
$
|
55,233
|
|
Software, including capitalized software development costs
|
31,435
|
|
|
27,959
|
|
||
Furniture and office equipment
|
11,982
|
|
|
9,511
|
|
||
Leasehold improvements
|
48,109
|
|
|
41,464
|
|
||
|
154,277
|
|
|
134,167
|
|
||
Less: Accumulated depreciation
|
(73,942
|
)
|
|
(66,479
|
)
|
||
|
80,335
|
|
|
67,688
|
|
||
Work in progress
|
11,743
|
|
|
8,144
|
|
||
|
$
|
92,078
|
|
|
$
|
75,832
|
|
(in thousands)
|
September 4, 2018
|
||
Cash and cash equivalents
|
$
|
6,950
|
|
Accounts receivable and other assets
|
10,542
|
|
|
Property and equipment
|
6,108
|
|
|
Goodwill
|
159,097
|
|
|
Intangible assets
|
73,000
|
|
|
Contract liabilities
|
(9,973
|
)
|
|
Other liabilities
|
(12,948
|
)
|
|
Deferred tax liability
|
(7,047
|
)
|
|
|
$
|
225,729
|
|
(in thousands, except years)
|
Estimated Fair Value
|
|
Expected Useful Life
|
||
Existing technology
|
$
|
11,900
|
|
|
3 years
|
Customer relationships—subscription
|
54,200
|
|
|
9 years
|
|
Backlog—subscription
|
6,400
|
|
|
2 years
|
|
Tradenames / trademarks
|
500
|
|
|
1 year
|
|
Total preliminary intangible assets
|
$
|
73,000
|
|
|
|
(in thousands, except per share data)
|
Three Months Ended
July 31, 2018 |
|
Six Months Ended
July 31, 2018 |
||||
Revenue
|
$
|
175,066
|
|
|
$
|
337,710
|
|
Net loss
|
(44,448
|
)
|
|
(325,090
|
)
|
||
Net loss per share attributable to common stockholders, basic and diluted
|
(0.27
|
)
|
|
(3.18
|
)
|
Balance at January 31, 2019
|
$
|
195,225
|
|
Cumulative translation adjustment
|
202
|
|
|
Balance at July 31, 2019
|
$
|
195,427
|
|
|
|
|
As of July 31, 2019
|
|
As of January 31, 2019
|
||||||||||||||||||||
(in thousands)
|
Weighted-average Remaining Useful Life (Years)
|
|
Estimated Fair Value
|
|
Accumulated Amortization
|
|
Acquisition-related Intangibles, Net
|
|
Estimated Fair Value
|
|
Accumulated Amortization
|
|
Acquisition-related Intangibles, Net
|
||||||||||||
Existing technology
|
2.1
|
|
$
|
31,594
|
|
|
$
|
(23,112
|
)
|
|
$
|
8,482
|
|
|
$
|
31,594
|
|
|
$
|
(20,747
|
)
|
|
$
|
10,847
|
|
Tradenames / trademarks
|
0.6
|
|
2,419
|
|
|
(2,223
|
)
|
|
196
|
|
|
2,419
|
|
|
(1,858
|
)
|
|
561
|
|
||||||
Customer contracts & related relationships
|
7.9
|
|
65,782
|
|
|
(15,148
|
)
|
|
50,634
|
|
|
65,782
|
|
|
(11,168
|
)
|
|
54,614
|
|
||||||
Certifications
|
1.1
|
|
6,917
|
|
|
(5,538
|
)
|
|
1,379
|
|
|
6,917
|
|
|
(4,846
|
)
|
|
2,071
|
|
||||||
Maintenance contracts & related relationships
|
0.9
|
|
1,498
|
|
|
(1,254
|
)
|
|
244
|
|
|
1,498
|
|
|
(1,104
|
)
|
|
394
|
|
||||||
Backlog—Subscription
|
1.2
|
|
6,400
|
|
|
(2,905
|
)
|
|
3,495
|
|
|
6,400
|
|
|
(1,304
|
)
|
|
5,096
|
|
||||||
|
6.6
|
|
$
|
114,610
|
|
|
$
|
(50,180
|
)
|
|
64,430
|
|
|
$
|
114,610
|
|
|
$
|
(41,027
|
)
|
|
73,583
|
|
||
Cumulative translation adjustment
|
|
|
|
|
|
|
640
|
|
|
|
|
|
|
620
|
|
||||||||||
Total
|
|
|
|
|
|
|
$
|
65,070
|
|
|
|
|
|
|
$
|
74,203
|
|
|
Three Months Ended July 31,
|
|
Six Months Ended July 31,
|
||||||||||||
(in thousands)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Cost of subscription revenue
|
$
|
1,381
|
|
|
$
|
1,003
|
|
|
$
|
3,008
|
|
|
$
|
2,671
|
|
Sales and marketing
|
3,039
|
|
|
765
|
|
|
6,145
|
|
|
1,530
|
|
||||
Total
|
$
|
4,420
|
|
|
$
|
1,768
|
|
|
$
|
9,153
|
|
|
$
|
4,201
|
|
Fiscal 2020, remainder
|
$
|
8,564
|
|
Fiscal 2021
|
13,818
|
|
|
Fiscal 2022
|
8,370
|
|
|
Fiscal 2023
|
6,023
|
|
|
Fiscal 2024
|
6,023
|
|
|
Thereafter
|
21,632
|
|
|
Total
|
$
|
64,430
|
|
|
Six Months Ended July 31,
|
||||||
(in thousands)
|
2019
|
|
2018
|
||||
Beginning balance
|
$
|
115,985
|
|
|
$
|
77,344
|
|
Additions to deferred contract acquisition costs
|
39,879
|
|
|
29,662
|
|
||
Amortization of deferred contract acquisition costs
|
(26,929
|
)
|
|
(18,223
|
)
|
||
Cumulative translation adjustment
|
(1,394
|
)
|
|
—
|
|
||
Ending balance
|
$
|
127,541
|
|
|
$
|
88,783
|
|
|
July 31,
|
||||||
(in thousands)
|
2019
|
|
2018
|
||||
Deferred contract acquisition costs, current
|
$
|
3,107
|
|
|
$
|
2,584
|
|
Deferred contract acquisitions costs, noncurrent
|
124,434
|
|
|
86,199
|
|
||
Total
|
$
|
127,541
|
|
|
$
|
88,783
|
|
|
Six Months Ended July 31,
|
||||||
(in thousands)
|
2019
|
|
2018
|
||||
Beginning balance
|
$
|
3,432
|
|
|
$
|
3,316
|
|
Additions to deferred contract fulfillment costs
|
8,560
|
|
|
677
|
|
||
Amortization of deferred contract fulfillment costs
|
(4,220
|
)
|
|
(923
|
)
|
||
Ending balance
|
$
|
7,772
|
|
|
$
|
3,070
|
|
|
July 31,
|
||||||
(in thousands)
|
2019
|
|
2018
|
||||
Deferred contract fulfillment costs, current
|
$
|
4,600
|
|
|
$
|
913
|
|
Deferred contract fulfillment costs, noncurrent
|
3,172
|
|
|
2,157
|
|
||
Total
|
$
|
7,772
|
|
|
$
|
3,070
|
|
•
|
During any fiscal quarter commencing after the fiscal quarter ending on January 31, 2019 (and only during such fiscal quarter), if the last reported sale price of our 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;
|
•
|
During the 5-business day period after any 10 consecutive trading day period (the “measurement period”) in which the trading price as defined in the Indenture 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 common stock and the conversion rate on each such trading day;
|
•
|
If we call any or all of the notes for redemption, at any time prior to the close of business on the scheduled trading day immediately preceding the redemption date; or
|
•
|
Upon the occurrence of specified corporate events described in the Indenture.
|
(in thousands)
|
July 31, 2019
|
||
Principal
|
$
|
575,000
|
|
Less: unamortized debt discount
|
(113,845
|
)
|
|
Less: unamortized transaction costs
|
(9,221
|
)
|
|
Net carrying amount
|
$
|
451,934
|
|
(in thousands)
|
July 31, 2019
|
||
Proceeds allocated to the conversion option (debt discount)
|
$
|
134,667
|
|
Less: transaction costs
|
(3,336
|
)
|
|
Net carrying amount
|
$
|
131,331
|
|
(in thousands)
|
Three Months Ended July 31, 2019
|
|
Six Months Ended July 31, 2019
|
||||
Contractual interest expense
|
$
|
719
|
|
|
$
|
1,429
|
|
Amortization of debt discount
|
6,058
|
|
|
12,028
|
|
||
Amortization of transaction costs
|
490
|
|
|
974
|
|
||
Total
|
$
|
7,267
|
|
|
$
|
14,431
|
|
|
Three Months Ended
July 31, 2019 |
|
Six Months Ended
July 31, 2019 |
||||
Operating lease cost
|
$
|
6,625
|
|
|
$
|
12,331
|
|
Short-term lease cost
|
172
|
|
|
441
|
|
||
Variable lease cost and other, net
|
138
|
|
|
187
|
|
||
Total lease cost
|
$
|
6,935
|
|
|
$
|
12,959
|
|
Fiscal 2020, remainder
|
$
|
11,227
|
|
Fiscal 2021
|
26,340
|
|
|
Fiscal 2022
|
27,291
|
|
|
Fiscal 2023
|
27,697
|
|
|
Fiscal 2024
|
27,784
|
|
|
Thereafter
|
79,339
|
|
|
Total undiscounted cash flows
|
$
|
199,678
|
|
Less imputed interest
|
(31,992
|
)
|
|
Present value of lease liabilities
|
$
|
167,686
|
|
Weighted average remaining term (years)
|
8.2
|
|
|
Weighted average discount rate
|
4.4
|
%
|
Fiscal 2020
|
$
|
22,198
|
|
Fiscal 2021
|
22,617
|
|
|
Fiscal 2022
|
22,556
|
|
|
Fiscal 2023
|
23,173
|
|
|
Fiscal 2024
|
23,373
|
|
|
Thereafter
|
34,634
|
|
|
Total minimum lease payments
|
$
|
148,551
|
|
Fiscal 2020, remainder
|
$
|
4,322
|
|
Fiscal 2021
|
10,987
|
|
|
Fiscal 2022
|
9,379
|
|
|
Fiscal 2023
|
898
|
|
|
Fiscal 2024
|
943
|
|
|
Thereafter
|
4,555
|
|
|
Total
|
$
|
31,084
|
|
(in thousands, except per share and years data)
|
Number of Options Outstanding
|
|
Weighted-Average Exercise Price Per Share
|
|
Weighted-Average Remaining Contractual Term (Years)
|
|
Aggregate Intrinsic Value
|
|||||
Outstanding at January 31, 2019
|
13,648
|
|
|
$
|
12.27
|
|
|
5.38
|
|
$
|
507,371
|
|
Options exercised
|
(3,869
|
)
|
|
9.86
|
|
|
|
|
|
|||
Options canceled/expired
|
(27
|
)
|
|
17.67
|
|
|
|
|
|
|||
Outstanding at July 31, 2019
|
9,752
|
|
|
$
|
13.22
|
|
|
5.28
|
|
$
|
375,487
|
|
Vested and expected to vest at July 31, 2019
|
9,653
|
|
|
$
|
13.17
|
|
|
5.26
|
|
$
|
372,090
|
|
Exercisable at July 31, 2019
|
8,518
|
|
|
$
|
12.57
|
|
|
4.97
|
|
$
|
333,456
|
|
(in thousands, except per share data)
|
Number of Units
|
|
Weighted-Average Grant Date Fair Value
|
|||
Unvested at January 31, 2019
|
17,142
|
|
|
$
|
34.56
|
|
Granted
|
4,760
|
|
|
52.91
|
|
|
Vested
|
(4,180
|
)
|
|
26.07
|
|
|
Canceled
|
(1,283
|
)
|
|
37.52
|
|
|
Unvested at July 31, 2019
|
16,439
|
|
|
$
|
41.78
|
|
|
Three Months Ended July 31,
|
|
Six Months Ended July 31,
|
||||||||||||
(in thousands, except per share data)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Numerator:
|
|
|
|
|
|
|
|
||||||||
Net loss
|
$
|
(68,632
|
)
|
|
$
|
(36,714
|
)
|
|
$
|
(114,354
|
)
|
|
$
|
(307,401
|
)
|
Less: preferred stock accretion
|
—
|
|
|
—
|
|
|
—
|
|
|
(353
|
)
|
||||
Net loss attributable to common stockholders
|
$
|
(68,632
|
)
|
|
$
|
(36,714
|
)
|
|
$
|
(114,354
|
)
|
|
$
|
(307,754
|
)
|
Denominator:
|
|
|
|
|
|
|
|
||||||||
Weighted-average common shares outstanding
|
175,389
|
|
|
166,084
|
|
|
173,773
|
|
|
102,284
|
|
||||
Net loss per share attributable to common stockholders:
|
|
|
|
|
|
|
|
||||||||
Basic and diluted
|
$
|
(0.39
|
)
|
|
$
|
(0.22
|
)
|
|
$
|
(0.66
|
)
|
|
$
|
(3.01
|
)
|
|
July 31,
|
||||
(in thousands)
|
2019
|
|
2018
|
||
Stock options
|
9,752
|
|
|
18,122
|
|
RSUs
|
15,893
|
|
|
18,908
|
|
ESPP
|
288
|
|
|
—
|
|
Total antidilutive securities
|
25,933
|
|
|
37,030
|
|
|
Three Months Ended July 31,
|
|
Six Months Ended July 31,
|
||||||||||||
(in thousands)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
U.S.
|
$
|
193,736
|
|
|
$
|
138,543
|
|
|
$
|
370,002
|
|
|
$
|
268,357
|
|
International
|
41,876
|
|
|
28,501
|
|
|
79,572
|
|
|
54,495
|
|
||||
Total revenue
|
$
|
235,612
|
|
|
$
|
167,044
|
|
|
$
|
449,574
|
|
|
$
|
322,852
|
|
(in thousands)
|
July 31, 2019
|
|
January 31, 2019
|
||||
U.S.
|
$
|
76,349
|
|
|
$
|
60,625
|
|
International
|
15,729
|
|
|
15,207
|
|
||
Total property and equipment
|
$
|
92,078
|
|
|
$
|
75,832
|
|
|
Three Months Ended July 31,
|
Six Months Ended July 31,
|
||||||||||||
(in thousands)
|
2019
|
|
2018
|
2019
|
|
2018
|
||||||||
Total revenue
|
$
|
235,612
|
|
|
$
|
167,044
|
|
$
|
449,574
|
|
|
$
|
322,852
|
|
Total costs and expenses
|
300,334
|
|
|
204,764
|
|
556,733
|
|
|
628,130
|
|
||||
Total stock-based compensation expense
|
55,792
|
|
|
40,165
|
|
98,063
|
|
|
309,959
|
|
||||
Loss from operations
|
(64,722
|
)
|
|
(37,720
|
)
|
(107,159
|
)
|
|
(305,278
|
)
|
||||
Net loss
|
(68,632
|
)
|
|
(36,714
|
)
|
(114,354
|
)
|
|
(307,401
|
)
|
||||
Cash provided by operating activities
|
26,405
|
|
|
22,695
|
|
72,060
|
|
|
37,688
|
|
||||
Capital expenditures
|
(14,554
|
)
|
|
(4,336
|
)
|
(29,791
|
)
|
|
(10,520
|
)
|
|
Three Months Ended July 31,
|
|
Six Months Ended July 31,
|
||||||||||||
(in thousands)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Revenue:
|
|
|
|
|
|
|
|
||||||||
Subscription
|
$
|
220,811
|
|
|
$
|
158,461
|
|
|
$
|
422,269
|
|
|
$
|
306,659
|
|
Professional services and other
|
14,801
|
|
|
8,583
|
|
|
27,305
|
|
|
16,193
|
|
||||
Total revenue
|
235,612
|
|
|
167,044
|
|
|
449,574
|
|
|
322,852
|
|
||||
Cost of revenue:
|
|
|
|
|
|
|
|
||||||||
Subscription
|
39,472
|
|
|
23,057
|
|
|
72,591
|
|
|
55,495
|
|
||||
Professional services and other
|
21,704
|
|
|
13,304
|
|
|
40,604
|
|
|
39,160
|
|
||||
Total cost of revenue
|
61,176
|
|
|
36,361
|
|
|
113,195
|
|
|
94,655
|
|
||||
Gross profit
|
174,436
|
|
|
130,683
|
|
|
336,379
|
|
|
228,197
|
|
||||
Operating expenses:
|
|
|
|
|
|
|
|
||||||||
Sales and marketing
|
150,886
|
|
|
103,779
|
|
|
280,822
|
|
|
294,864
|
|
||||
Research and development
|
47,517
|
|
|
33,773
|
|
|
84,700
|
|
|
104,643
|
|
||||
General and administrative
|
40,755
|
|
|
30,851
|
|
|
78,016
|
|
|
133,968
|
|
||||
Total expenses
|
239,158
|
|
|
168,403
|
|
|
443,538
|
|
|
533,475
|
|
||||
Loss from operations
|
(64,722
|
)
|
|
(37,720
|
)
|
|
(107,159
|
)
|
|
(305,278
|
)
|
||||
Interest expense
|
(7,273
|
)
|
|
(47
|
)
|
|
(14,429
|
)
|
|
(240
|
)
|
||||
Interest income and other income, net
|
4,531
|
|
|
2,998
|
|
|
9,748
|
|
|
770
|
|
||||
Loss before provision for income taxes
|
(67,464
|
)
|
|
(34,769
|
)
|
|
(111,840
|
)
|
|
(304,748
|
)
|
||||
Provision for income taxes
|
1,168
|
|
|
1,945
|
|
|
2,514
|
|
|
2,653
|
|
||||
Net loss
|
$
|
(68,632
|
)
|
|
$
|
(36,714
|
)
|
|
$
|
(114,354
|
)
|
|
$
|
(307,401
|
)
|
|
Three Months Ended July 31,
|
|
|
|
Six Months Ended July 31,
|
|
|
||||||||||||||
(in thousands, except for percentages)
|
2019
|
|
2018
|
|
% Change
|
|
2019
|
|
2018
|
|
% Change
|
||||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Subscription
|
$
|
220,811
|
|
|
$
|
158,461
|
|
|
39
|
%
|
|
$
|
422,269
|
|
|
$
|
306,659
|
|
|
38
|
%
|
Professional services and other
|
14,801
|
|
|
8,583
|
|
|
72
|
%
|
|
27,305
|
|
|
16,193
|
|
|
69
|
%
|
||||
Total revenue
|
$
|
235,612
|
|
|
$
|
167,044
|
|
|
41
|
%
|
|
$
|
449,574
|
|
|
$
|
322,852
|
|
|
39
|
%
|
|
Three Months Ended July 31,
|
|
|
|
Six Months Ended July 31,
|
|
|
||||||||||||||
(in thousands, except for percentages)
|
2019
|
|
2018
|
|
% Change
|
|
2019
|
|
2018
|
|
% Change
|
||||||||||
Cost of revenue:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Subscription
|
$
|
39,472
|
|
|
$
|
23,057
|
|
|
71
|
%
|
|
$
|
72,591
|
|
|
$
|
55,495
|
|
|
31
|
%
|
Professional services and other
|
21,704
|
|
|
13,304
|
|
|
63
|
%
|
|
40,604
|
|
|
39,160
|
|
|
4
|
%
|
||||
Total cost of revenue
|
$
|
61,176
|
|
|
$
|
36,361
|
|
|
68
|
%
|
|
$
|
113,195
|
|
|
$
|
94,655
|
|
|
20
|
%
|
Gross margin:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Subscription
|
82
|
%
|
|
85
|
%
|
|
(3
|
)pts
|
|
83
|
%
|
|
82
|
%
|
|
1
|
pts
|
||||
Professional services and other
|
(47
|
)%
|
|
(55
|
)%
|
|
8
|
pts
|
|
(49
|
)%
|
|
(142
|
)%
|
|
93
|
pts
|
||||
Total gross margin
|
74
|
%
|
|
78
|
%
|
|
(4
|
)pts
|
|
75
|
%
|
|
71
|
%
|
|
4
|
pts
|
▪
|
An increase of $8.8 million in operating costs to support our platform, the addition of SpringCM and higher data center costs; and
|
▪
|
An increase of $4.2 million in personnel costs primarily driven by increases in headcount and the addition of SpringCM employees.
|
▪
|
An increase of $12.3 million in operating costs to support our platform and the addition of SpringCM; and
|
▪
|
An increase of $7.3 million in personnel costs primarily driven by increases in headcount.
|
▪
|
An increase of $3.4 million in personnel costs primarily related to the increased headcount in our professional services organization and the addition of SpringCM employees; and
|
▪
|
An increase of $2.0 million in stock-based compensation expense due to higher headcount.
|
▪
|
An increase of $6.8 million in personnel costs primarily related to increased headcount in our professional services organization and the addition of SpringCM employees; and
|
▪
|
An increase of $2.7 million primarily related to the impact of the acquisition of SpringCM.
|
|
Three Months Ended July 31,
|
|
|
|
Six Months Ended July 31,
|
|
|
||||||||||||
(in thousands, except for percentages)
|
2019
|
|
2018
|
|
% Change
|
|
2019
|
|
2018
|
|
% Change
|
||||||||
Sales and marketing
|
$
|
150,886
|
|
|
$
|
103,779
|
|
|
45
|
%
|
|
280,822
|
|
|
294,864
|
|
|
(5
|
)%
|
Percentage of revenue
|
64
|
%
|
|
62
|
%
|
|
|
|
62
|
%
|
|
91
|
%
|
|
|
▪
|
An increase of $21.7 million in personnel costs driven by increased headcount, addition of SpringCM employees and higher commissions from higher sales;
|
▪
|
An increase of $9.2 million in stock-based compensation expense due to higher headcount;
|
▪
|
An increase of $5.7 million in allocated overhead due to higher allocated IT and facility costs;
|
▪
|
An increase of $4.2 million in marketing and advertising expense, primarily due to higher spend for online advertising campaigns; and
|
▪
|
An increase of $3.2 million in depreciation and amortization due to the amortization of certain intangible assets acquired in the SpringCM acquisition on September 4, 2018.
|
▪
|
An increase of $40.3 million in personnel costs driven by increased headcount, addition of SpringCM employees, higher commissions in line with higher sales and headcount, as well as the employer portion of payroll taxes related to restricted stock unit ("RSU") settlements with no such expense in the prior year;
|
▪
|
An increase of $10.0 million in allocated overhead due to higher allocated IT and facility costs;
|
▪
|
An increase of $6.8 million in marketing and advertising expense, primarily due to higher spend for online advertising campaigns;
|
▪
|
An increase of $5.8 million in depreciation and amortization due to the amortization of the intangible assets acquired in the SpringCM acquisition on September 4, 2018; and
|
▪
|
An increase of $4.0 million in other expenses primarily due to higher spend on employee-related costs.
|
|
Three Months Ended July 31,
|
|
|
|
Six Months Ended July 31,
|
|
|
||||||||||||
(in thousands, except for percentages)
|
2019
|
|
2018
|
|
% Change
|
|
2019
|
|
2018
|
|
% Change
|
||||||||
Research and development
|
$
|
47,517
|
|
|
$
|
33,773
|
|
|
41
|
%
|
|
84,700
|
|
|
104,643
|
|
|
(19
|
)%
|
Percentage of revenue
|
20
|
%
|
|
20
|
%
|
|
|
|
19
|
%
|
|
33
|
%
|
|
|
▪
|
An increase of $6.0 million in personnel costs due to increased headcount and the addition of SpringCM employees; and
|
▪
|
An increase of $4.6 million in stock-based compensation expense due to higher headcount.
|
▪
|
An increase of $9.7 million in personnel costs due to higher headcount and the addition of SpringCM employees; and
|
▪
|
An increase of $2.1 million in allocated overhead due to increased allocated IT and facility costs.
|
|
Three Months Ended July 31,
|
|
|
|
Six Months Ended July 31,
|
|
|
||||||||||||
(in thousands, except for percentages)
|
2019
|
|
2018
|
|
% Change
|
|
2019
|
|
2018
|
|
% Change
|
||||||||
General and administrative
|
$
|
40,755
|
|
|
$
|
30,851
|
|
|
32
|
%
|
|
78,016
|
|
|
133,968
|
|
|
(42
|
)%
|
Percentage of revenue
|
17
|
%
|
|
19
|
%
|
|
|
|
18
|
%
|
|
42
|
%
|
|
|
▪
|
An increase of $4.6 million in professional fees, driven by RPost litigation and settlement expenses, partially offset by higher professional fees incurred in prior year as a newly public company; and
|
▪
|
An increase of $3.9 million in personnel costs due to higher headcount.
|
▪
|
An increase of $7.6 million in personnel costs due to higher headcount and the employer portion of payroll taxes related to RSU settlements with no such expense in the prior year; and
|
▪
|
An increase of $5.5 million in litigation costs.
|
|
Three Months Ended July 31,
|
|
|
|
Six Months Ended July 31,
|
|
|
||||||||||
(in thousands, except for percentages)
|
2019
|
|
2018
|
|
% Change
|
|
2019
|
|
2018
|
|
% Change
|
||||||
Interest expense
|
$
|
(7,273
|
)
|
|
$
|
(47
|
)
|
|
NM
|
|
(14,429
|
)
|
|
(240
|
)
|
|
NM
|
Percentage of revenue
|
(3
|
)%
|
|
—
|
%
|
|
|
|
(3
|
)%
|
|
—
|
%
|
|
|
|
Three Months Ended July 31,
|
|
|
|
Six Months Ended July 31,
|
|
|
||||||||||||||
(in thousands, except for percentages)
|
2019
|
|
2018
|
|
% Change
|
|
2019
|
|
2018
|
|
% Change
|
||||||||||
Interest income
|
$
|
3,940
|
|
|
$
|
2,936
|
|
|
34
|
%
|
|
7,618
|
|
|
3,384
|
|
|
125
|
%
|
||
Foreign currency gain (loss)
|
(837
|
)
|
|
159
|
|
|
NM
|
|
|
(1,261
|
)
|
|
2,338
|
|
|
NM
|
|
||||
Other
|
1,428
|
|
|
(97
|
)
|
|
NM
|
|
|
3,391
|
|
|
(4,952
|
)
|
|
NM
|
|
||||
Interest income and other income, net
|
$
|
4,531
|
|
|
$
|
2,998
|
|
|
51
|
%
|
|
$
|
9,748
|
|
|
$
|
770
|
|
|
NM
|
|
Percentage of revenue
|
1
|
%
|
|
2
|
%
|
|
|
|
2
|
%
|
|
1
|
%
|
|
|
|
Three Months Ended July 31,
|
|
|
|
Six Months Ended July 31,
|
|
|
||||||||||||
(in thousands, except for percentages)
|
2019
|
|
2018
|
|
% Change
|
|
2019
|
|
2018
|
|
% Change
|
||||||||
Provision for income taxes
|
$
|
1,168
|
|
|
$
|
1,945
|
|
|
(40
|
)%
|
|
2,514
|
|
|
2,653
|
|
|
(5
|
)%
|
Percentage of revenue
|
—
|
%
|
|
1
|
%
|
|
|
|
—
|
%
|
|
1
|
%
|
|
|
|
Six Months Ended July 31,
|
|
|
||||||||
(in thousands)
|
2019
|
|
2018
|
|
$ Change
|
||||||
Net cash provided by (used in):
|
|
|
|
|
|
||||||
Operating activities
|
$
|
72,060
|
|
|
$
|
37,688
|
|
|
$
|
34,372
|
|
Investing activities
|
(331,728
|
)
|
|
(10,520
|
)
|
|
(321,208
|
)
|
|||
Financing activities
|
(32,967
|
)
|
|
536,101
|
|
|
(569,068
|
)
|
|||
Effect of foreign exchange on cash and cash equivalents
|
(1,120
|
)
|
|
(1,543
|
)
|
|
423
|
|
|||
Net change in cash, cash equivalents and restricted cash
|
$
|
(293,755
|
)
|
|
$
|
561,726
|
|
|
$
|
(855,481
|
)
|
|
Three Months Ended July 31,
|
|
Six Months Ended July 31,
|
||||||||||||
(in thousands)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
GAAP gross profit
|
$
|
174,436
|
|
|
$
|
130,683
|
|
|
$
|
336,379
|
|
|
$
|
228,197
|
|
Add: Stock-based compensation
|
7,936
|
|
|
4,410
|
|
|
13,658
|
|
|
30,410
|
|
||||
Add: Amortization of acquisition-related intangibles
|
1,381
|
|
|
1,003
|
|
|
3,008
|
|
|
2,671
|
|
||||
Add: Employer payroll tax on employee stock transactions
|
541
|
|
|
—
|
|
|
1,193
|
|
|
—
|
|
||||
Non-GAAP gross profit
|
$
|
184,294
|
|
|
$
|
136,096
|
|
|
$
|
354,238
|
|
|
$
|
261,278
|
|
GAAP gross margin
|
74
|
%
|
|
78
|
%
|
|
75
|
%
|
|
71
|
%
|
||||
Non-GAAP adjustments
|
4
|
%
|
|
3
|
%
|
|
4
|
%
|
|
10
|
%
|
||||
Non-GAAP gross margin
|
78
|
%
|
|
81
|
%
|
|
79
|
%
|
|
81
|
%
|
||||
|
|
|
|
|
|
|
|
||||||||
GAAP subscription gross profit
|
$
|
181,339
|
|
|
$
|
135,404
|
|
|
$
|
349,678
|
|
|
$
|
251,164
|
|
Add: Stock-based compensation
|
3,115
|
|
|
1,588
|
|
|
5,397
|
|
|
11,543
|
|
||||
Add: Amortization of acquisition-related intangibles
|
1,381
|
|
|
1,003
|
|
|
3,008
|
|
|
2,671
|
|
||||
Add: Employer payroll tax on employee stock transactions
|
211
|
|
|
—
|
|
|
432
|
|
|
—
|
|
||||
Non-GAAP subscription gross profit
|
$
|
186,046
|
|
|
$
|
137,995
|
|
|
$
|
358,515
|
|
|
$
|
265,378
|
|
GAAP subscription gross margin
|
82
|
%
|
|
85
|
%
|
|
83
|
%
|
|
82
|
%
|
||||
Non-GAAP adjustments
|
2
|
%
|
|
2
|
%
|
|
2
|
%
|
|
5
|
%
|
||||
Non-GAAP subscription gross margin
|
84
|
%
|
|
87
|
%
|
|
85
|
%
|
|
87
|
%
|
||||
|
|
|
|
|
|
|
|
||||||||
GAAP professional services and other gross loss
|
$
|
(6,903
|
)
|
|
$
|
(4,721
|
)
|
|
$
|
(13,299
|
)
|
|
$
|
(22,967
|
)
|
Add: Stock-based compensation
|
4,821
|
|
|
2,822
|
|
|
8,261
|
|
|
18,867
|
|
||||
Add: Employer payroll tax on employee stock transactions
|
330
|
|
|
—
|
|
|
761
|
|
|
—
|
|
||||
Non-GAAP professional services and other gross loss
|
$
|
(1,752
|
)
|
|
$
|
(1,899
|
)
|
|
$
|
(4,277
|
)
|
|
$
|
(4,100
|
)
|
GAAP professional services and other gross margin
|
(47
|
)%
|
|
(55
|
)%
|
|
(49
|
)%
|
|
(142
|
)%
|
||||
Non-GAAP adjustments
|
35
|
%
|
|
33
|
%
|
|
33
|
%
|
|
117
|
%
|
||||
Non-GAAP professional services and other gross margin
|
(12
|
)%
|
|
(22
|
)%
|
|
(16
|
)%
|
|
(25
|
)%
|
|
Three Months Ended July 31,
|
|
Six Months Ended July 31,
|
||||||||||||
(in thousands)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
GAAP operating loss
|
$
|
(64,722
|
)
|
|
$
|
(37,720
|
)
|
|
$
|
(107,159
|
)
|
|
$
|
(305,278
|
)
|
Add: Stock-based compensation
|
55,792
|
|
|
40,165
|
|
|
98,063
|
|
|
309,959
|
|
||||
Add: Amortization of acquisition-related intangibles
|
4,420
|
|
|
1,768
|
|
|
9,153
|
|
|
4,201
|
|
||||
Add: Employer payroll tax on employee stock transactions
|
3,864
|
|
|
—
|
|
|
9,619
|
|
|
—
|
|
||||
Non-GAAP operating income (loss)
|
$
|
(646
|
)
|
|
$
|
4,213
|
|
|
$
|
9,676
|
|
|
$
|
8,882
|
|
GAAP operating margin
|
(27
|
)%
|
|
(23
|
)%
|
|
(24
|
)%
|
|
(95
|
)%
|
||||
Non-GAAP adjustments
|
27
|
%
|
|
26
|
%
|
|
26
|
%
|
|
98
|
%
|
||||
Non-GAAP operating margin
|
—
|
%
|
|
3
|
%
|
|
2
|
%
|
|
3
|
%
|
|
Three Months Ended July 31,
|
|
Six Months Ended July 31,
|
||||||||||||
(in thousands, except per share data)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
GAAP net loss
|
$
|
(68,632
|
)
|
|
$
|
(36,714
|
)
|
|
$
|
(114,354
|
)
|
|
$
|
(307,401
|
)
|
Add: Stock-based compensation
|
55,792
|
|
|
40,165
|
|
|
98,063
|
|
|
309,959
|
|
||||
Add: Amortization of acquisition-related intangibles
|
4,420
|
|
|
1,768
|
|
|
9,153
|
|
|
4,201
|
|
||||
Add: Employer payroll tax on employee stock transactions
|
3,864
|
|
|
—
|
|
|
9,619
|
|
|
—
|
|
||||
Add: Amortization of debt discount and issuance costs
|
6,548
|
|
|
—
|
|
|
13,002
|
|
|
—
|
|
||||
Non-GAAP net income
|
$
|
1,992
|
|
|
$
|
5,219
|
|
|
$
|
15,483
|
|
|
$
|
6,759
|
|
|
Three Months Ended July 31,
|
|
Six Months Ended July 31,
|
||||||||||||
(in thousands)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Net cash provided by operating activities
|
$
|
26,405
|
|
|
$
|
22,695
|
|
|
$
|
72,060
|
|
|
$
|
37,688
|
|
Less: purchase of property and equipment
|
(14,554
|
)
|
|
(4,336
|
)
|
|
(29,791
|
)
|
|
(10,520
|
)
|
||||
Non-GAAP free cash flow
|
$
|
11,851
|
|
|
$
|
18,359
|
|
|
$
|
42,269
|
|
|
$
|
27,168
|
|
Net cash used in investing activities
|
$
|
(18,237
|
)
|
|
$
|
(4,336
|
)
|
|
$
|
(331,728
|
)
|
|
$
|
(10,520
|
)
|
Net cash provided by (used in) financing activities
|
$
|
(19,647
|
)
|
|
$
|
530,480
|
|
|
$
|
(32,967
|
)
|
|
$
|
536,101
|
|
|
Three Months Ended July 31,
|
|
Six Months Ended July 31,
|
||||||||||||
(in thousands)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Revenue
|
$
|
235,612
|
|
|
$
|
167,044
|
|
|
$
|
449,574
|
|
|
$
|
322,852
|
|
Add: Contract liabilities and refund liability, end of period
|
412,953
|
|
|
300,426
|
|
|
412,953
|
|
|
300,426
|
|
||||
Less: Contract liabilities and refund liability, beginning of period
|
(395,254
|
)
|
|
(293,667
|
)
|
|
(390,887
|
)
|
|
(282,943
|
)
|
||||
Add: Contract assets and unbilled accounts receivable, beginning of period
|
16,810
|
|
|
14,555
|
|
|
13,436
|
|
|
16,899
|
|
||||
Less: Contract assets and unbilled accounts receivable, end of period
|
(17,757
|
)
|
|
(16,196
|
)
|
|
(17,757
|
)
|
|
(16,196
|
)
|
||||
Non-GAAP billings
|
$
|
252,364
|
|
|
$
|
172,162
|
|
|
$
|
467,319
|
|
|
$
|
341,038
|
|
▪
|
any decline in demand for our e-signature solution;
|
▪
|
the failure of our e-signature solution to achieve continued market acceptance;
|
▪
|
the market for electronic signatures not continuing to grow, or growing more slowly than we expect;
|
▪
|
the introduction of products and technologies that serve as a replacement or substitute for, or represent an improvement over, our e-signature solution;
|
▪
|
technological innovations or new standards that our e-signature solution does not address;
|
▪
|
changes in regulatory requirements;
|
▪
|
sensitivity to current or future prices offered by us or competing e-signature solutions; and
|
▪
|
our inability to release enhanced versions of our e-signature solution on a timely basis.
|
▪
|
price our e-signature solutions effectively so that we are able to attract and retain customers without compromising our profitability;
|
▪
|
attract new customers, increase our existing customers’ use of our solutions and provide our customers with excellent customer support;
|
▪
|
expand our software suite to support “System of Agreement” for our customers;
|
▪
|
continue to introduce our e-signature solutions to new markets outside of the U.S.;
|
▪
|
successfully identify and acquire or invest in businesses, products or technologies that we believe could complement or expand our solutions; and
|
▪
|
increase awareness of our brand on a global basis.
|
▪
|
sales and marketing, including a significant expansion of our sales organization, particularly in the U.S.;
|
▪
|
our technology infrastructure, including systems architecture, management tools, scalability, availability, performance and security, as well as disaster recovery measures;
|
▪
|
product development, including investments in our product development team and the development of new products and new functionality for our existing solutions;
|
▪
|
acquisitions or strategic investments;
|
▪
|
international expansion; and
|
▪
|
general administration, including legal and accounting expenses.
|
▪
|
fluctuations in demand for or pricing of our solutions;
|
▪
|
our ability to attract and retain customers;
|
▪
|
our ability to retain our existing customers at existing levels and expand of their usage of our solutions;
|
▪
|
customer expansion rates and the pricing and quantity of user subscriptions renewed;
|
▪
|
timing of new subscriptions and payments;
|
▪
|
fluctuations in customer delays in purchasing decisions in anticipation of new products or product enhancements by us or our competitors;
|
▪
|
changes in customers’ budgets and in the timing of their budget cycles and purchasing decisions;
|
▪
|
potential and existing customers choosing our competitors’ products or developing their own e-signature solution in-house, or opting to use only the free version of our products;
|
▪
|
timing of new products, new product functionality and new customers;
|
▪
|
the collectability of receivables from customers and resellers, which may be hindered or delayed if these customers or resellers experience financial distress;
|
▪
|
delays in closing sales, including the timing of renewals, which may result in revenue being pushed into the next quarter, particularly because a large portion of our sales occur toward the end of each quarter;
|
▪
|
our ability to control costs, including our operating expenses;
|
▪
|
potential accelerations of prepaid expenses and deferred costs;
|
▪
|
the amount and timing of payment for operating expenses, particularly research and development and sales and marketing expenses (including commissions and bonuses associated with performance);
|
▪
|
the amount and timing of non-cash expenses, including stock-based compensation, goodwill impairments and other non-cash charges;
|
▪
|
the amount and timing of costs associated with recruiting, training and integrating new employees;
|
▪
|
impacts of acquisitions;
|
▪
|
issues relating to partnerships with third parties, product and geographic mix;
|
▪
|
general economic conditions, both domestically and internationally, as well as economic conditions specifically affecting industries in which our customers participate;
|
▪
|
the impact of new accounting pronouncements;
|
▪
|
changes in the competitive dynamics of our market, including consolidation among competitors or customers;
|
▪
|
significant security breaches of, technical difficulties with, or interruptions to, the delivery and use of our solutions; and
|
▪
|
awareness of our brand on a global basis.
|
▪
|
the effectiveness of our sales force, in particular new sales people as we increase the size of our sales force and train our new sales people to sell to enterprise customers that require more training;
|
▪
|
the discretionary nature of purchasing and budget cycles and decisions;
|
▪
|
the obstacles placed by customers’ procurement process;
|
▪
|
economic conditions and other factors impacting customer budgets;
|
▪
|
the customer’s integration complexity;
|
▪
|
the customer’s familiarity with the e-signature process;
|
▪
|
customer evaluation of competing products during the purchasing process; and
|
▪
|
evolving customer demands.
|
▪
|
failure to predict market demand accurately in terms of functionality and to supply solutions that meet this demand in a timely fashion;
|
▪
|
defects, errors or failures;
|
▪
|
negative publicity about their performance or effectiveness;
|
▪
|
changes in the legal or regulatory requirements, or increased legal or regulatory scrutiny, adversely affecting our solutions;
|
▪
|
delays in releasing our new solutions or enhancements to the market; and
|
▪
|
introduction or anticipated introduction of competing products by our competitors.
|
▪
|
loss of customers;
|
▪
|
lost or delayed market acceptance and sales of our solutions;
|
▪
|
delays in payment to us by customers;
|
▪
|
injury to our reputation and brand;
|
▪
|
legal claims, including warranty and service claims, against us;
|
▪
|
diversion of our resources, including through increased service and warranty expenses or financial concessions; and increased insurance costs.
|
▪
|
changes in a specific country’s or region’s political or economic conditions;
|
▪
|
the need to adapt and localize our products for specific countries;
|
▪
|
greater difficulty collecting accounts receivable and longer payment cycles;
|
▪
|
potential changes in trade relations arising from policy initiatives implemented by the Trump administration, which has been critical of existing and proposed trade agreements;
|
▪
|
unexpected changes in laws, regulatory requirements, taxes or trade laws;
|
▪
|
more stringent regulations relating to privacy and data security and the unauthorized use of, or access to, commercial and personal information, particularly in Europe;
|
▪
|
differing labor regulations, especially in Europe, where labor laws are generally more advantageous to employees as compared to the U.S., including deemed hourly wage and overtime regulations in these locations;
|
▪
|
challenges inherent in efficiently managing an increased number of employees over large geographic distances, including the need to implement appropriate systems, policies, benefits and compliance programs;
|
▪
|
difficulties in managing a business in new markets with diverse cultures, languages, customs, legal systems, alternative dispute systems and regulatory systems;
|
▪
|
increased travel, real estate, infrastructure and legal compliance costs associated with international operations;
|
▪
|
currency exchange rate fluctuations and the resulting effect on our revenue and expenses, and the cost and risk of entering into hedging transactions if we chose to do so in the future;
|
▪
|
limitations on our ability to reinvest earnings from operations in one country to fund the capital needs of our operations in other countries;
|
▪
|
laws and business practices favoring local competitors or general preferences for local vendors;
|
▪
|
limited or insufficient intellectual property protection or difficulties enforcing our intellectual property;
|
▪
|
political instability or terrorist activities;
|
▪
|
exposure to liabilities under anti-corruption and anti-money laundering laws, including the U.S. Foreign Corrupt Practices Act of 1977, as amended, (the "FCPA"), the U.S. domestic bribery statute contained in 18 U.S.C. § 201, the U.S. Travel Act, the U.K. Bribery Act, and similar laws and regulations in other jurisdictions; and
|
▪
|
adverse tax burdens and foreign exchange controls that could make it difficult to repatriate earnings and cash.
|
•
|
limit our ability to borrow additional funds for working capital, capital expenditures, acquisitions or other general business purposes;
|
•
|
limit our ability to use our cash flow or obtain additional financing for future working capital, capital expenditures, acquisitions or other general business purposes;
|
•
|
require us to use a substantial portion of our cash flow from operations to make debt service payments;
|
•
|
limit our flexibility to plan for, or react to, changes in our business and industry;
|
•
|
place us at a competitive disadvantage compared to our less leveraged competitors; and
|
•
|
increase our vulnerability to the impact of adverse economic and industry conditions.
|
▪
|
actual or anticipated fluctuations in our financial condition and operating results;
|
▪
|
variance in our financial performance from expectations of securities analysts;
|
▪
|
changes in the prices of subscriptions to our solutions;
|
▪
|
changes in our projected operating and financial results;
|
▪
|
changes in laws or regulations applicable to our solutions;
|
▪
|
announcements by us or our competitors of significant business developments, acquisitions or new offerings;
|
▪
|
our involvement in any litigation;
|
▪
|
future sales of our common stock or other securities, by us or our stockholders, as well as the anticipation of lock-up releases;
|
▪
|
changes in senior management or key personnel;
|
▪
|
the trading volume of our common stock;
|
▪
|
changes in the anticipated future size and growth rate of our market; and
|
▪
|
general economic, regulatory and market conditions.
|
▪
|
authorize our board of directors to issue, without further action by the stockholders, shares of undesignated preferred stock with terms, rights and preferences determined by our board of directors that may be senior to our common stock;
|
▪
|
require that any action to be taken by our stockholders be effected at a duly called annual or special meeting and not by written consent;
|
▪
|
specify that special meetings of our stockholders can be called only by our board of directors, the chairperson of our board of directors, or our chief executive officer;
|
▪
|
establish an advance notice procedure for stockholder proposals to be brought before an annual meeting, including proposed nominations of persons for election to our board of directors;
|
▪
|
establish that our board of directors is divided into three classes, with each class serving three-year staggered terms;
|
▪
|
prohibit cumulative voting in the election of directors;
|
▪
|
provide that our directors may be removed for cause only upon the vote of sixty-six and two-thirds percent (66 2/3%) of our outstanding shares of common stock;
|
▪
|
provide that vacancies on our board of directors may be filled only by a majority of directors then in office, even though less than a quorum; and
|
▪
|
require the approval of our board of directors or the holders of at least sixty-six and two-thirds percent (66 2/3%) of our outstanding shares of common stock to amend our bylaws and certain provisions of our certificate of incorporation.
|
Exhibit Number
|
|
Description
|
|
Form
|
|
File No.
|
|
Incorporated by Reference Exhibit
|
|
Filing Date
|
10.1#
|
|
|
|
|
|
|
|
|
|
|
10.2#
|
|
|
|
|
|
|
|
|
|
|
31.1
|
|
|
|
|
|
|
|
|
|
|
31.2
|
|
|
|
|
|
|
|
|
|
|
32.1*
|
|
|
|
|
|
|
|
|
|
|
101.INS
|
|
XBRL Instance Document.
|
|
|
|
|
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document.
|
|
|
|
|
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document.
|
|
|
|
|
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Definition Linkbase Document.
|
|
|
|
|
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Labels Linkbase Document.
|
|
|
|
|
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document.
|
|
|
|
|
|
|
|
|
#
|
Indicates management contract or compensatory plan, contract or agreement
|
*
|
The certifications furnished in Exhibit 32.1 hereto are deemed to accompany this Quarterly Report on Form 10-Q and will not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, except to the extent that the registrant specifically incorporates it by reference.
|
|
DOCUSIGN, INC.
|
|
|
|
|
|
By:
|
/s/ Daniel D. Springer
|
|
|
Daniel D. Springer
|
|
|
Chief Executive Officer
|
|
|
(Principal Executive Officer)
|
|
|
|
|
By:
|
/s/ Michael J. Sheridan
|
|
|
Michael J. Sheridan
|
|
|
Chief Financial Officer
|
|
|
(Principal Accounting and Financial Officer)
|
Participant:
|
|
Date of Grant:
|
|
Vesting Commencement Date:
|
|
Target Number of PSUs Subject to Award:
|
|
Maximum Number of PSUs Subject to Award:
|
|
Vesting Schedule:
|
As provided in the Performance Goals and Vesting Criteria set forth on Attachment I.
|
Issuance Schedule:
|
If a PSU vests, the Company will deliver one share of Common Stock in settlement of each vested PSU as set forth in Section 6 of the PSU Terms and Conditions.
|
•
|
Copies of this Award Agreement, the Plan, and the prospectus for the Plan are available on the Company’s internal or hosted web site, and may be viewed and printed by Participant.
|
•
|
Participant is familiar with the terms and conditions of the Plan and this Award Agreement (including all attachments and exhibits) and has had an opportunity to obtain the advice of counsel prior to executing this Award Agreement and accepting the Award.
|
•
|
With respect to the Award, the terms of the Award as set forth in this Award Agreement supersede any individually negotiated agreement you have with Company or an Affiliate and any generally applicable severance or change-in-control plan, policy, or practice, whether written or unwritten, of the Company or an Affiliate that would otherwise apply to the Award (“Separate Agreement”). As a condition to accepting your Award, you acknowledge that your Award is not subject to the terms of any Separate Agreement and is governed solely by this Award Agreement and the Plan.
|
•
|
This Award Agreement and the Plan set forth the entire understanding between Participant and the Company regarding the acquisition of Common Stock pursuant to the Award and supersede all other oral and written agreements on that subject (including the terms of any Separate Agreement).
|
•
|
All decisions or interpretations of the Board or the Stock Plan Administrator upon any questions arising under the Plan or this Award are binding, conclusive and final on Participant.
|
DocuSign, Inc.
|
|
By: ___ __
|
Signature
|
|
Title: _______ _ _________
|
|
Date:
|
Attachment I:
|
Performance Goals and Vesting Criteria
|
Attachment II:
|
PSU Terms and Conditions
|
Company TSR%
|
% Multiplier*
|
Payout Level
|
= < - 25 points versus Index TSR%
|
0%
|
0%
|
= - 25 points versus Index TSR%
|
50%
|
Threshold
|
= Index TSR%
|
100%
|
Target
|
= + 25 points versus Index TSR%
|
150%
|
150% Target
|
= or > + 50 points versus Index TSR%
|
200%
|
Maximum
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of DocuSign, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(c)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
|
By:
|
/s/ Daniel D. Springer
|
|
|
Daniel D. Springer
|
|
|
Chief Executive Officer
|
|
|
(Principal Executive Officer)
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of DocuSign, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(c)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
|
By:
|
/s/ Michael J. Sheridan
|
|
|
Michael J. Sheridan
|
|
|
Chief Financial Officer
|
|
|
(Principal Accounting and Financial Officer)
|
|
By:
|
/s/ Daniel D. Springer
|
|
|
Daniel D. Springer
|
|
|
Chief Executive Officer
|
|
|
(Principal Executive Officer)
|
|
By:
|
/s/ Michael J. Sheridan
|
|
|
Michael J. Sheridan
|
|
|
Chief Financial Officer
|
|
|
(Principal Accounting and Financial Officer)
|