Commitments and Contingencies |
9 Months Ended |
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Oct. 31, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Letters of Credit
In April 2023, the Company terminated its credit facility with Silicon Valley Bank (“SVB”), while keeping its existing letters of credit in lieu of deposits on certain leases. As the Company no longer has a credit facility with SVB, it was required to collateralize these letters of credit with cash, totaling approximately $1.3 million outstanding as of October 31, 2024 and January 31, 2024, which the Company has therefore classified within restricted cash. As of October 31, 2024, $0.6 million of this restricted cash is recorded within prepaid expenses and other current assets and $0.7 million is recorded within other non-current assets on the condensed consolidated balance sheets. As of January 31, 2024, all of the restricted cash was recorded within other non-current assets on the condensed consolidated balance sheets, due to its long-term nature.
During 2023, the Company entered into cash collateral agreements with J.P. Morgan Bank in lieu of a letter of credit facility, through which approximately $6.9 million and $5.4 million is outstanding as of October 31, 2024 and January 31, 2024, respectively. As of October 31, 2024, $0.9 million of this restricted cash is recorded within prepaid expenses and other current assets and $6.0 million is recorded within other non-current assets on the condensed consolidated balance sheets. As of January 31, 2024, all of the restricted cash was recorded within other non-current assets on the condensed consolidated balance sheets, due to its long-term nature.
Legal Matters
From time to time, the Company, various subsidiaries, and certain current and former officers may be named as defendants in various lawsuits, claims, investigations and proceedings arising from the normal course of business. The Company also may become involved with contract issues and disputes with customers. With respect to litigation in general, based on the Company’s experience, management believes that the amount of damages claimed in a case are not a meaningful indicator of the potential liability. Claims, suits, investigations and proceedings are inherently uncertain and it is not possible to predict the ultimate outcome of cases.
The Company makes a provision for a liability relating to legal matters when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. These provisions are reviewed at least quarterly and adjusted to reflect the impacts of negotiations, estimated settlements, legal rulings, advice of legal counsel and other information and events pertaining to a particular matter. In management’s opinion, resolution of all current matters is not expected to have a material adverse impact on the Company’s condensed consolidated results of operations, cash flows or financial position. However, if an unfavorable ruling were to occur in any specific period, there exists the possibility of a material adverse impact on the results of operations for that period.
On August 13, 2024, a putative securities class action (the “Action”) was filed in the U.S. District Court for the Southern District of New York, captioned Boshart v. Sprinklr, Inc. et al, Case No. 1:24-cv-06132, naming the Company and certain of its officers as defendants. The plaintiff purports to bring suit on behalf of those who purchased or otherwise acquired the Company’s securities between March 29, 2023 and June 5, 2024 (the “Class Period”). The complaint asserts claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, as amended, and Rule 10b-5 promulgated thereunder, for alleged false and misleading statements during the putative Class Period about the Company’s business, operations and management, and primarily seeks compensatory damages for all affected members of the putative class. On November 22, 2024, the Court appointed a lead plaintiff for the putative class, changed the case title to In re Sprinklr, Inc. Securities Litigation, and directed the lead plaintiff to inform the Court by December 3, 2024 whether he seeks leave to file a superseding amended complaint and if so by what date he proposes to do so. The Company
intends to vigorously defend this lawsuit. Given the nature of the case, including that the proceedings are in their early stages, the Company is unable to predict the ultimate outcome of the case or estimate the range of potential loss, if any.
Other Contractual Commitments
Other contractual commitments consist primarily of non-cancelable minimum guaranteed purchase commitments for various data, hosting and software services, which the Company may renew as part of the normal course of business. During the nine months ended October 31, 2024, the lease for the new corporate headquarters located in New York, NY commenced, which impacts the Company’s cash requirements. See Note 7 Leases for additional information. There were no other significant changes in the Company’s material cash requirements as compared to the material cash requirements from known contractual and other obligations described in the 2024 10-K.
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