Basis of Presentation and Significant Accounting Policies |
3 Months Ended |
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Apr. 30, 2026 | |
| Accounting Policies [Abstract] | |
| Basis of Presentation and Significant Accounting Policies |
Basis of Presentation and Significant Accounting Policies Basis of Presentation
The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (the “SEC”) regarding interim financial reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by U.S. GAAP have been condensed or omitted. These unaudited condensed consolidated financial statements have been prepared on the same basis as the Company’s annual consolidated financial statements and, in the opinion of management, reflect all adjustments (consisting only of normal recurring adjustments) that are necessary for the fair presentation of the Company’s condensed consolidated financial information. The results of operations for the three months ended April 30, 2026 are not necessarily indicative of the results to be expected for the year ending January 31, 2027 or for any other interim period or for any other future year. During May 2026, the Company completed an asset acquisition, primarily to acquire technology and intellectual property. The aggregate consideration paid is not considered material to the Company’s consolidated financial statements.
The accompanying interim unaudited condensed consolidated financial statements and related financial information should be read in conjunction with the audited consolidated financial statements and the related notes thereto for the year ended January 31, 2026 in the Company’s Annual Report on Form 10-K (the “2026 10-K”) filed with the SEC on March 19, 2026.
Principles of Consolidation
The condensed consolidated financial statements include the Company and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.
Reclassifications
Certain prior-period amounts have been reclassified to conform to the current-period presentation, as described below:
•During the first quarter of fiscal year 2027, the Company changed the presentation of its share repurchase activity within stockholders’ equity from accumulated deficit to additional paid‑in capital. Prior-period balances have been recast to conform to the current-period presentation. This change represents a reclassification within equity only and does not affect total stockholders’ equity, net income, or cash flows.
•In the condensed consolidated statements of cash flows, prepaid expenses and other current assets have been combined with other non-current assets, and accrued expenses and other current liabilities have been combined with other liabilities to conform to current-period presentation.
Use of Estimates
The preparation of the condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, including contingent assets and liabilities, as of the balance sheet date. Estimates and assumptions also affect the reported amounts of revenue and expenses during the reporting periods. Significant estimates and assumptions in the accompanying condensed consolidated financial statements include, but are not limited to, those related to the determination of principal versus agent and variable consideration in our revenue contracts, fair value assumptions for stock-based compensation, capitalization of internal-use software costs, period of benefit for capitalized costs to obtain customer contracts, useful lives of long-lived assets, valuation of intangible assets, and allowance for credit losses, among others. The Company evaluates its estimates and assumptions on an ongoing basis, using historical experience and other factors that it
believes are reasonable, and adjusts them when facts and circumstances dictate. Actual results could differ materially from those estimates and assumptions.
Summary of Significant Accounting Policies
There have been no significant changes to the Company’s significant accounting policies, other than the update described below, as of and for the three months ended April 30, 2026, as compared to those described in the 2026 10-K.
Costs to Obtain Customer Contracts
Incremental and recoverable costs to obtain customer contracts, including sales commissions and fees paid to third parties, are capitalized when they are expected to be recovered. These costs are amortized on a straight-line basis over the estimated period of benefit, which is determined based on factors such as contract duration, customer relationship trends, technology lifecycle, and other relevant factors. We assess the expected period of benefit annually, considering such factors. As a result of our most recent assessment, which reflected improved customer retention, the expected period of benefit for incremental costs to acquire new and upsell agreements increased from five years to six years. This change in accounting estimate was effective February 1, 2026 and is accounted for prospectively. As a result of this change, amortization expense, which is reported in sales and marketing expenses, was lower by $0.5 million for the three months ended April 30, 2026. The period of benefit for contract renewals continues to be based on the renewal contract’s duration.
We periodically evaluate deferred contract costs for impairment. Such impairments were immaterial for each of the three months ended April 30, 2026 and 2025.
Concentration of Risk and Significant Customers
The Company’s financial instruments that are potentially subject to credit risk consist primarily of cash, cash equivalents, and accounts receivable. Although the Company deposits its cash with multiple financial institutions, its deposits generally exceed federally insured limits.
To manage credit risk related to accounts receivable, the Company maintains an allowance for credit losses, which is estimated on a pooled basis for receivables that share similar risk characteristics. The Company determines its allowance using a loss-rate method based on historical experience, current conditions, and reasonable and supportable forecasts. Receivables that do not share similar risk characteristics with a pool are evaluated individually. The allowance is reviewed at each reporting date and adjusted as necessary. Receivables are written off when collection efforts are exhausted and amounts are deemed uncollectible. Recoveries of amounts previously written off are recorded as a reduction of the allowance. Changes in the allowance are recognized in the provision for credit losses and reported in sales and marketing expenses in the consolidated statements of operations.
The Company’s accounts receivable at April 30, 2026 are derived from customers located primarily in North America and Asia (which includes the Middle East). A large multinational customer represented 10.4% of consolidated revenue for the three months ended April 30, 2026 as a result of the timing of revenue recognition. No other customer accounted for more than 10% of total revenue during the three months ended April 30, 2026 and 2025.
In addition, the Company relies upon third-party hosted infrastructure partners globally to serve customers and operate certain aspects of its services, such as environments for development testing, training, sales demonstrations, and production usage. Given this, any disruption of or interference at the Company’s hosted infrastructure partners would impact the Company’s operations and could adversely impact its business.
Recently Issued Accounting Pronouncements Pending Adoption
In November 2024 and January 2025, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures: Disaggregation of Income Statement Expenses (“ASU 2024-03”), and ASU 2025-01, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures: Clarifying the Effective Date (“ASU 2025-01”), respectively. These ASUs require new financial statement disclosures disaggregating prescribed expense categories within relevant income statement expense captions. ASU 2024-03 and ASU 2025-01 will be effective for fiscal years beginning after December 15, 2026, and interim periods beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating the impact of these standards on its disclosures in the consolidated financial statements.
In July 2025, the FASB issued ASU 2025-05, Financial Instruments—Credit Losses: Measurement of Credit Losses for Accounts Receivable and Contract Assets (“ASU 2025-05”), introducing a practical expedient whereby, when developing reasonable and supportable forecasts as part of estimating expected credit losses, entities may elect to assume that current conditions as of the balance sheet date do not change for the remaining life of the asset. ASU 2025-05 is effective for the Company’s annual period beginning
fiscal year 2027, on a prospective basis, and early adoption is permitted. The Company is currently evaluating the impact that ASU 2025-05 will have on its consolidated financial statements and disclosures therein.
In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software (“ASU 2025-06”), removing all references to prescriptive and sequential software development stages throughout Subtopic 350-40 and requiring certain disclosures for capitalized internal-use software, regardless of how those costs are presented in the financial statements. ASU 2025-06 is effective for the Company’s annual period beginning fiscal year 2029, on a prospective, modified transition or retrospective transition basis, and early adoption is permitted. The Company is currently evaluating the impact that ASU 2025-06 will have on its consolidated financial statements and disclosures therein.
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